Robert Muthama Kiamba & another v Francis Mutuku & 11 others [2018] KEELC 2107 (KLR)
The bottom line
#The Environment and Land Court in Makueni dismissed both injunction applications, ruling that buyers in loan default and vendors without a contract with the lender cannot stop a chargee from enforcing its security.
What this practically means
#Executive summary
#Key legal issues
#Whether the plaintiffs/applicants established a prima facie case against the 11th respondent
They did not; there was no privity of contract between the applicants and the 11th respondent, which was not a party to or mentioned in the sale agreements
The sale agreements were between the plaintiffs and the 1st to 10th defendants only, and contained no reference to the 11th respondent. Though counsel alleged an understanding that the 11th respondent would finance the purchases, no evidence of compliance with the agreements' provisions was adduced. The court found the issue of privity of contract fatal to the applicants' prima facie case and declined to proceed to the other Giella conditions, guided by the sequential approach in Kenya Commercial Finance Co. Ltd v Afrala Education Society.
Whether a mandatory injunction to discharge the suit properties should issue
No; an unusually strong and clear case was not established
Applying the Halsbury and Locabail principles as restated by Kenyan courts, an interlocutory mandatory injunction requires special circumstances and a higher degree of assurance than a prohibitory injunction. The applicants did not demonstrate a clear case warranting such an order, particularly given the absence of privity of contract with the chargee.
Whether the 1st to 10th defendants were entitled to injunctions protecting their emoluments and property MAKUENI/KAKO/928
No; they are admittedly indebted and in default of the mortgage facilities
The court found it undisputed that the suit properties were charged to the 11th respondent and that the 1st to 10th defendants were in arrears. Aligning itself with the dictum in Benjamin Kamuruci Kaburi v Stanbic Bank, the court held that a defaulting chargor cannot excite the tenderness of equity and thus lacks a prima facie case with probability of success under the Giella test.
Legal principles established
#- The enquiry into whether to grant an interlocutory injunction is sequential, so the second and third Giella conditions only arise if a prima facie case is established
- A party in admitted default of a charge cannot establish a prima facie case for an injunction restraining realization of security
- A loss that is quantifiable and compensable by damages does not justify an interlocutory injunction
Court orders
#- 1.The plaintiffs/applicants' notice of motion dated 5th September, 2017 is dismissed with costs to the respondents
- 2.The application by the first to tenth respondents dated 20th September, 2017 is dismissed with costs to the eleventh respondent
- Jurisdiction invoked
- First-instance interlocutory jurisdiction of the Environment and Land Court; no constitutional or statutory basis expressly invoked in the judgment
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Robert Muthama Kiamba & another v Francis Mutuku & 11 others [2018] KEELC 2107 (KLR)", Case Analysis (2018). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2018/2107/eng@2018-07-06
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.