Lawrence Ojiambo Mugeni v Family Bank Ltd [2018] KEELC 4178 (KLR)
The bottom line
#A Kenyan court allowed Family Bank to proceed with selling a borrower's land because he proved neither that he had paid nor that the bank's claim was wrong.
What this practically means
#Executive summary
#Key legal issues
#Whether failure to serve statutory notice of sale was established
The court found the notices were served by registered post to the Applicant's given address and inferred receipt
The Respondent annexed the requisite notices (LAO-4, LAO-5 and LAO-6) to its replying affidavit and showed they were sent by registered post to the address the Applicant gave when borrowing. Nothing suggested the notices were returned to sender, so the court drew the inference that the Applicant received them, undermining the premise of the application.
Whether the Applicant was in default of the loan
The statement of account availed by the Respondent showed the Applicant in default, contradicting his claim of servicing the loan
The Applicant pleaded he had been servicing the loan, but the Respondent's supplementary affidavit availed a statement of the loan account (LAO-1) demonstrating default and indebtedness. The Applicant did not file submissions or address these issues, and the court treated his averments as hollow or misleading.
Whether the Applicant met the threshold for a temporary injunction
The Applicant failed to establish a prima facie case, irreparable harm or balance of convenience, so injunctive relief was refused
Applying the Giella v Cassman Brown principles and the Halsbury law quoted in Mrao Ltd v First American Bank, the court held that a defaulting mortgagor cannot obtain an injunction unless he pays the amount owed into court or demonstrates the mortgagee's claim is excessive. The Applicant did neither, and his failure to respond to the replying affidavit compounded his position.
Legal principles established
#- An injunction to restrain a mortgagee's sale will not issue merely because the amount due is disputed, a redemption action has been commenced, or the mortgagor objects to the manner of sale; the mortgagor must pay the sum owed into court or demonstrate that the mortgagee's claim is excessive
- The principles for granting a temporary injunction are establishment of a prima facie case with a probability of success, irreparable harm not compensable by damages, and, in doubt, the balance of convenience
Court orders
#- 1.The Notice of Motion dated 31/1/2017 (prayers 3 and 4) is dismissed
- 2.Costs of the application awarded to the Respondent
- Jurisdiction invoked
- Order 40 Rules 1, 3 and 4 of the Civil Procedure Rules and Sections 3A and 1A of the Civil Procedure Act (cap 21)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Lawrence Ojiambo Mugeni v Family Bank Ltd [2018] KEELC 4178 (KLR)", Case Analysis (2018). (suit contemporaneously filed with Notice of Motion dated 31/1/2017 - number not stated in judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2018/4178/eng@2018-03-14
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.