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ELCDismissedNotice of Motion dated 16th November 2020 (suit filed at Nakuru)· [2021] KEELC 4549 (KLR)

Jomo Kenyatta University of Agriculture and Technology v Kwanza Estates Limited [2021] KEELC 4549 (KLR)

Environment and Land Court of Kenya
28 January 2021
2,644 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~11 min to read original · ~4 min brief

The bottom line

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The Environment and Land Court in Nakuru dismissed Egerton University's bid to escape its lease early, confirming tenants cannot terminate fixed-term leases without a break clause.

What this practically means

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Executive summary

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The plaintiff, Egerton University, moved the court by Notice of Motion dated 16th November 2020 seeking interlocutory injunctions to restrain the defendant, its landlord at Kwanza House, Nakuru, from levying distress, attaching or selling its goods, and from preventing it from vacating the premises, with ancillary orders directing the OCS Nakuru Central Police Station to enforce the orders. The parties had leased the premises under fixed six-year leases running to 30th April 2022. The applicant contended that reduced enrolment of self-sponsored students and the Covid-19 closure directive frustrated the lease; it issued three months' notice of termination on 10th July 2020, stopped paying rent, and was met with an invoice for KShs 15,776,973, a proclamation of distress dated 6th November 2020, and security guards preventing removal of goods. The defendant, through its Managing Director Geoffrey Makana Asanyo, opposed the application, asserting the lease had no break clause, that early exit had been conditional on payment of outstanding rent which was never made, that restoration costs of about KShs 64,652,250 were claimed, and that guards had been placed only to secure distrained goods. Applying the Giella v Cassman Brown test as restated in Nguruman Limited v Jan Bonde Nielsen, and the Mrao definition of a prima facie case, the court held that midterm termination of a lease without a break clause is invalid, that the applicant's financial hardship was no basis for rewriting the contract, and that the applicant had no prima facie case. It further held damages, being ascertainable rent, were an adequate remedy. The application was dismissed with costs to the defendant on 28th January 2021.

Key legal issues

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01

Whether the applicant established a prima facie case for an interlocutory injunction

Holding

No prima facie case was established; the applicant does not dispute the lease terms or the unpaid rent, and its termination notice was of doubtful validity against settled law on leases without break clauses

Reasoning

The parties' tenant-landlord relationship and fixed-term lease were not in dispute. The applicant admitted unpaid rent, making the distress lawful. Whether the July 2020 termination notice could validly terminate a lease without a break clause was doubtful in light of KCB v Popatlal Madhavji, and granting exit would risk rewriting the contract.

p. 3
02

Whether damages are an adequate remedy

Holding

Damages would be adequate since the dispute ultimately reduces to a quantifiable claim for rent

Reasoning

Even had a prima facie case been shown, the second Giella limb failed. The rent payable was not in dispute, so damages could be ascertained with a good degree of precision; an injunction is not granted where damages are an adequate remedy.

p. 3
03

Whether the applicant was being unlawfully detained in the premises

Holding

The submission that the applicant was detained in the premises was unlikely to succeed at trial

Reasoning

The court found there was no suggestion the respondent would prevent exit if due rent were paid; the guards were positioned to secure distrained goods. A lease without a break clause binds the tenant for its term, so the applicant could not unilaterally exit while rent remained unpaid.

p. 3

Legal principles established

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  • Midterm termination of a lease without a break clause is not available; a notice of termination cannot validly terminate such a lease midstream
  • The three sequential limbs of the interlocutory injunction test are separate and distinct hurdles; failure on the first disposes of the application
  • A court will not rewrite or vary the express terms of a contract between parties, even where one party faces financial hardship
  • Where rent is unpaid, distress for rent is a lawful consequence and the obligation not to remove distrained goods is a legal one

Court orders

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  1. 1.Notice of Motion dated 16th November 2020 dismissed with costs to the defendant

Authorities

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Cases cited (8)

  • Chimanlal Meghji Naya Shah & another v Oxford University Press (EA) Limited
    [2007] eKLR
  • Panafrican News Agency v Teleposta Pension Scheme & 2 others
    [2006] eKLR
  • Kenya Commercial Bank Limited v Popatlal Madhavji & another
    [2019] eKLR
  • Nginyo Investment Limited v Mobile Pay Limited
    [2020] eKLR
  • Nguruman Limited v Jan Bonde Nielsen & 2 Others
    [2014] eKLR
  • Mrao Ltd vs First American Bank of Kenya Ltd & 2 Others
    (2003) KLR 125
  • National Bank of Kenya Ltd v Pipeplastic Samkolit (K) Ltd & another
    [2001] eKLR
  • Giella –vs- Cassman Brown & Co. Ltd
    [1973] E.A 358
Jurisdiction invoked
Inherent civil jurisdiction over lease/dispute and interlocutory injunction application (no specific constitutional/statutory provision stated in the judgment)

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, "Jomo Kenyatta University of Agriculture and Technology v Kwanza Estates Limited [2021] KEELC 4549 (KLR)", Case Analysis (2021). Notice of Motion dated 16th November 2020 (suit filed at Nakuru). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2021/4549/eng@2021-01-28

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