Stella Kavutha Muthoka & another v Kenya Women Microfinance Bank Ltd [2021] KEELC 2816 (KLR)
The bottom line
#A Kenyan landowner's suit to stop a bank from auctioning charged land was struck out because it was filed in the wrong court.
What this practically means
#Executive summary
#Key legal issues
#Jurisdiction of the ELC over disputes on exercise of statutory power of sale
The ELC lacks jurisdiction where the predominant issue is the chargee's exercise of statutory power of sale and issuance of statutory notices; such disputes fall within the High Court's civil jurisdiction.
The court adopted the Court of Appeal's binding decision in Co-operative Bank of Kenya Ltd v Patrick Kangethe Njuguna, which held that charging land does not constitute 'use of land' under Article 162(2)(b). A charge is merely a disposition securing repayment; the cause of action was the tabulation of sums owing and whether statutory notices issued, which are accounting/civil matters for the High Court. Since the Plaintiffs did not challenge the validity of the charge or allege fraud, the suit fell outside section 13 of the ELC Act.
Transfer of a suit filed without jurisdiction
A suit filed in a court without jurisdiction is a nullity, dead on arrival, and cannot be transferred to a competent court even by consent of the parties.
Relying on the Supreme Court's decision in Albert Chaurembo Mumba, which invoked Kagenyi v Musiramo, the court held that an order transferring a suit cannot be made unless the suit was first brought to a court with jurisdiction. This was reinforced by the Court of Appeal in Phoenix of E.A. Assurance v S.M. Thiga and Equity Bank v Bruce Mutie Mutuku. The only remedies are withdrawal of the suit or striking out with costs.
Legal principles established
#- Where the predominant issue in a suit involves mortgages, charges, collection of dues and rents, and the issuance of statutory notices in respect of charges, it is the High Court, and not the Environment and Land Court, that has jurisdiction.
- A suit filed before a court without jurisdiction is a nullity ab initio and cannot be transferred to another court; it can only be withdrawn or struck out with costs.
Court orders
#- 1.The Plaintiffs' suit is struck out with costs
- 2.The Plaintiffs to pay the costs of the Application dated 9th October 2020
- Jurisdiction invoked
- Article 162(2)(b) of the Constitution and Section 13 of the Environment and Land Court Act
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Stella Kavutha Muthoka & another v Kenya Women Microfinance Bank Ltd [2021] KEELC 2816 (KLR)", Case Analysis (2021). Not stated in judgment (suit filed 16th February 2017). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2021/2816/eng@2021-06-18
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.