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ELCAllowedELC Case (Notice of Motion dated 15th August 2019, Kajiado)· [2020] KEELC 1300 (KLR)

Vimit Converters Limited v Aima Enterprises Limited [2020] KEELC 1300 (KLR)

Environment and Land Court
24 September 2020
1,804 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
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The bottom line

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The Kajiado Environment and Land Court barred a former landowner from interfering with property it had lost through a bank sale, protecting the new owner's rights.

What this practically means

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Executive summary

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This was a ruling on the Plaintiff's Notice of Motion dated 15th August 2019 seeking a temporary injunction over land parcel Kajiado/Kaputiei North/14774 (2.02 hectares), plus police-assisted access to the property, pending the hearing of the suit. The Plaintiff, through its director Mahendra Haria, deponed that it was the registered proprietor of the suit land, having purchased it at a private sale by African Banking Corporation Limited in exercise of its statutory power of sale after the Defendant defaulted on a charge; registration and issuance of title occurred on 25th February 2019. The Plaintiff alleged that on 9th August 2019 the Defendant, without colour of right, invaded the land through auctioneers and attached goods worth over twenty million belonging to the Plaintiff's tenant, Surge Limited, via distress for rent. The Defendant, through director Mohamed Abukar, opposed the application, asserting it remained the registered proprietor since 2012, that the bank did not comply with proper legal process in the sale, that there were two competing titles, and that the transfer document was defective. Only the Plaintiff filed submissions. Applying the Giella v Cassman Brown principles, the court found the Plaintiff had established a prima facie case with probability of success, that its injuries were actual and not compensable by damages, and that the balance of convenience favoured it. The application was allowed with costs to the Plaintiff, with temporary injunction and security orders granted.

Key legal issues

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01

Prima facie case with probability of success

Holding

The Plaintiff, as current registered proprietor following the bank's exercise of statutory power of sale, established a prima facie case; the Defendant's distress of the Plaintiff's tenant over land it no longer owned infringed the Plaintiff's rights

Reasoning

The court noted the Defendant did not deny charging the suit land to ABC Bank, and that the land was registered in the Plaintiff's name in February 2019 with the Plaintiff taking occupation and leasing to a tenant. The Defendant nonetheless distressed the Plaintiff's tenant for rent although the land had ceased to belong to it. The Plaint raised triable issues, and on the facts and authorities the Plaintiff demonstrated a prima facie case with probability of success.

p. 2
02

Irreparable harm not compensable by damages

Holding

The Plaintiff's alleged injuries were actual, not speculative, given the Defendant's interference with land and distress against the Plaintiff's tenant despite knowing it was no longer the registered proprietor

Reasoning

Applying Nguruman Ltd v Jan Bonde Nielsen, the court held the Plaintiff bore the burden of demonstrating actual, substantial and demonstrable injury incapable of adequate compensation in damages. The Plaintiff had taken occupation, and the Defendant interfered with the land and distressed the Plaintiff's tenant knowing it was not the registered proprietor; therefore the harm was not speculative and the threshold was met.

p. 2
03

Balance of convenience

Holding

The balance of convenience tilts in favour of the Plaintiff

Reasoning

On the evidence presented by the parties, the court found the balance of convenience favoured the Plaintiff, who had demonstrated how it acquired the suit land and how the Defendant had trespassed thereon, while the Defendant's remedy, if any, lay in a claim against the bank over the exercise of the statutory power of sale.

p. 2

Legal principles established

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  • A party dissatisfied with the manner in which a chargee exercises its statutory power of sale should pursue the chargee, not interfere with the title of a bona fide purchaser from the sale
  • The Giella v Cassman Brown principles govern the grant of temporary injunctions: prima facie case, irreparable harm not compensable by damages, and balance of convenience

Court orders

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  1. 1.Temporary injunction granted against the Defendant in respect of land parcel Kajiado/Kaputiei North/14774 pending the hearing and determination of the suit
  2. 2.Order that the OCPD Kajiado/OCS Isinya Police Station provide security to the Plaintiff's representative and/or directors to access the property and exercise their right of enjoyment
  3. 3.Costs of the application awarded to the Plaintiff

Authorities

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Legislation

  • Civil Procedure ActSection 1A
  • Civil Procedure ActSection 1B
  • Civil Procedure ActSection 3A
  • Civil Procedure ActSection 63(e)
  • Civil Procedure RulesOrder 40 Rule 1
  • Civil Procedure RulesOrder 51 Rules 1 & 3

Cases cited (4)

  • Simon Njoroge Mburu V Consolidated Bank of Kenya Ltd
    (2014) eKLR
  • Mrao Limited Vs First American Bank Limited & 2 Others
    (2003) KLR 125
  • Nguruman Limited Vs Jan Bonde Nielsen & 2 Others
    (2014) eKLR
  • Giella Vs Cassman Brown and Co. Ltd
    (1973) EA 358
Jurisdiction invoked
Sections 1A, 1B, 3A and 63(e) of the Civil Procedure Act; Order 40 Rule 1 and Order 51 Rules 1 & 3 of the Civil Procedure Rules

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Vimit Converters Limited v Aima Enterprises Limited [2020] KEELC 1300 (KLR)", Case Analysis (2020). ELC Case (Notice of Motion dated 15th August 2019, Kajiado). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2020/1300/eng@2020-09-24

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