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ELCDismissedNot stated in the excerpt (ELC, Thika)· [2020] KEELC 961 (KLR)

Celine Wambui Kigwe v National Bank of Kenya & 2 others [2020] KEELC 961 (KLR)

Environment and Land Court
22 October 2020
7,075 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~28 min to read original · ~4 min brief

The bottom line

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A Kenyan landowner who lost her property at a bank auction failed to stop eviction because her rights ended when the hammer fell.

What this practically means

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Executive summary

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The Plaintiff, Celine Wambui Kigwe, charged land parcel No. 10823/423 (I.R No. 121737) to the 1st Defendant, National Bank of Kenya Limited, to secure a loan of Kshs. 4 million taken in 2016. She alleged the bank made unauthorised debits to her loan account and then fraudulently sold the property by public auction on 12th February 2019 to the 3rd Defendant, Madonna Realtors Limited, for Kshs. 12,750,000 against a 2016 valuation of Kshs. 45,000,000, without proper statutory notices and while earlier litigation over the property was pending. She moved the Court by Notice of Motion dated 1st July 2020 seeking an injunction against eviction and, alternatively, reinstatement to the property pending trial. The 1st and 3rd Defendants filed preliminary objections contending the suit was sub judice and res judicata given Milimani CMCC No. 7493 of 2018 and Milimani ELC Misc No. 172 of 2019, and that the suit was vexatious and an abuse of process. The Court (L. Gacheru, J) dismissed the preliminary objections, holding that res judicata and sub judice require ascertainment of facts and cannot be raised as pure preliminary objections, and that the plaint's fraud allegations disclosed a reasonable cause of action unsuitable for summary dismissal. On the application, applying Giella v Cassman Brown, the Court found the Plaintiff had no prima facie case because her equity of redemption was extinguished at the fall of the hammer; damages under Section 99(4) of the Land Act were an adequate remedy; the 3rd Defendant was a purchaser protected under Section 99 of the Land Act; and the balance of convenience favoured the 3rd Defendant. Both the preliminary objections and the application were dismissed with costs to the Defendants, the preliminary objection costs being in the cause.

Key legal issues

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01

Whether res judicata/sub judice may be determined on a preliminary objection

Holding

No - such issues require probing of evidence and ascertainment of facts

Reasoning

Applying Mukisa Biscuits, Oraro v Mbaja, Khaemba and Kimani, the court held that determining whether issues were directly and substantially in issue in prior suits requires examination of facts and pleadings, which is beyond the limited scope of a preliminary objection; the proper route is a Notice of Motion or the main trial.

p. 6
02

Whether the suit should be struck out as vexatious and an abuse of process

Holding

No - the plaint raises allegations of fraud and illegality amounting to a reasonable cause of action

Reasoning

Applying D.T. Dobie v Muchina and Francis Kamande v Vanguard Electrical, the court held a suit may be summarily dismissed only where it is plainly hopeless and discloses no cause of action. The plaint's fraud allegations required ventilation at trial.

p. 6
03

Whether the Plaintiff established a prima facie case for injunction

Holding

No - equity of redemption extinguished upon the fall of the hammer at the public auction

Reasoning

The property was validly charged and the chargee exercised its statutory power of sale under Section 96 of the Land Act; the property was sold to the 3rd Defendant by public auction with no injunctive orders in place; post-sale the chargor's remedy is damages, so the injunction application fails the Giella test.

p. 7
04

Whether damages would be an adequate remedy and where the balance of convenience lies

Holding

Damages adequate under Section 99(4) of the Land Act; balance of convenience favours the 3rd Defendant as a protected purchaser

Reasoning

The Plaintiff valued the property and sought damages as an alternative prayer; Section 99(2)(c) protects purchasers from inquiry into the regularity of the sale, so the 3rd Defendant is protected and the balance of convenience does not favour the Plaintiff.

Legal principles established

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  • Issues of sub judice and res judicata require ascertainment of facts and cannot be raised as pure preliminary objections
  • Once property is sold at public auction in exercise of statutory power of sale, the chargor's equity of redemption is extinguished and the only remedy is damages
  • A charged property becomes a commodity for sale and sentimental attachment does not bar exercise of statutory power of sale

Court orders

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  1. 1.The two Notices of Preliminary Objections by the 1st and 3rd Defendants are dismissed entirely with costs in the cause
  2. 2.The Notice of Motion Application dated 1st July 2020 is dismissed entirely with costs to the Defendants/Respondents

Authorities

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Legislation

  • Civil Procedure Actsections 6, 7
  • Land Actsections 90(1), 96(1), 96(2), 97(1), 99(1)(a), 99(2)(c), 99(4)
  • Civil Procedure RulesOrder 21 rule 1

Cases cited (20)

  • Giella vs Cassman Brown Co Ltd
    (1973) EA 358
  • Thiba Min. Hydro Co. Ltd vs Josphat Karu Ndwiga
    [2013] eKLR
  • Francis J. K. Ichatha vs Housing Finance Co. of Kenya
    (2005) eKLR
  • Kofinaf Company Ltd & Another vs Nahashon Ngige Nyagah & 2 others
    (2017) eKLR
  • Christopher Orina Kenyariri T/A Kenyariri & Associates Advocates vs Salama Beach Hotel Ltd & 3 Others
    (2017) eKLR
  • Arthi Highway Developers Ltd vs West End Butchery Ltd & 6 Others
    [2015] eKLR
  • Bomet Beer Distributors Ltd & Another vs Kenya Commercial Bank Ltd & 4 others
    [2005] eKLR
  • Quick Enterprises Ltd vs Kenya Railways Corporation
    Kisumu HCCC No. 22 of 1999
  • Mukisa Biscuits Manufacturing Co. Ltd vs West End Distributors Ltd
    (1969) EA 696
  • Oraro vs Mbaja
    (2005) 1 KLR 141
  • Henry Wanyama Khaemba vs Standard Chartered Bank Ltd & Another
    (2014) eKLR
  • George Kamau Kimani & 4 Others vs County Government of Trans Nzoia & Another
    (2014) eKLR
  • D.T Dobie & Company Ltd vs Muchina & Another
    (1982) KLR 1
  • Francis Kamande vs Vanguard Electrical Services Ltd
    (1998) eKLR
  • Nyutu & Others vs Gatheru & Others
    (1990) KLR 554
  • E.A Industries vs Trufoods
    (1972) EA 420
  • Agip (K) Ltd vs Maheshchandra Himatlal Vora & Others
    Civil Appeal No. 213 of 1999 (2000) 2 EA 285
  • Habib Bank Attorney General Zurich vs Eugene Marion Yakub
    Civil Appeal No. 43 of 1982
  • East African Breweries Ltd vs Castle Brewing (K) Ltd
    Nairobi High Court Civil Case No. 848 of 1998 (1998) LLR 7408
  • Daniel Ndonge Ndirangu vs Barclays Bank of Kenya Ltd & Another
    Nakuru HCCC No. 8 of 2012
Jurisdiction invoked
Original jurisdiction of the Environment and Land Court under the Environment and Land Court Act

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (2)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Celine Wambui Kigwe v National Bank of Kenya & 2 others [2020] KEELC 961 (KLR)", Case Analysis (2020). Not stated in the excerpt (ELC, Thika). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2020/961/eng@2020-10-22

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.