Kitsao & another v TSS Investment Limited & 2 others (Environment & Land Case 51 of 2022) [2022] KEELC 3058 (KLR)
The bottom line
#Kenya's Environment and Land Court in Mombasa confirmed tenants can sue to stop a bank auction if not given proper notice, and paused the sale.
What this practically means
#Executive summary
#Key legal issues
#Whether the preliminary objection met the Mukisa Biscuits threshold
The objection was held properly filed as raising serious and pure issues of law, though on the res judicata limb the court noted factual matters required a full record
Applying Mukisa Biscuits and related authorities, the court found the issues raised were not fanciful or remote and constituted matters properly determinable at the preliminary stage. The court nonetheless accepted that where facts must be ascertained or discretion exercised, a preliminary objection fails, which informed its treatment of the res judicata and locus grounds.
Whether the ELC has jurisdiction over a claim by tenants challenging a chargee's statutory power of sale
The ELC has original and unlimited jurisdiction; the objection that only the High Court could hear the matter was dismissed
Article 162(2)(b) and section 13 of the ELC Act confer jurisdiction over disputes relating to the use, occupation and title to land. Distinguishing Co-operative Bank v Patrick Kangethe, the court held that where the legality of the charge or the manner of disposal of charged land is in issue, the dispute is land-related and falls to the ELC; only matters purely of accounts would go to the High Court.
Whether tenants have locus standi to challenge the exercise of statutory power of sale
Tenants have locus standi under the expanded scheme of section 96(3)(e) of the Land Act 2012, which entitles lessees and sub-lessees to notice to sell
The court distinguished Venture Capital, Nairobi Mamba Village and Caneland Limited, holding their force had waned with the Land Act 2012, which expanded the category of persons entitled to notice and thus to complain of non-service. Adopting Ashite Chandrakant Patel v Diamond Trust Bank, it held tenants must be given notice of an intended sale and the right of notice belongs to the tenant.
Whether the suit was res judicata
The plea of res judicata failed because the defendants did not demonstrate determination of the matter by a court of competent jurisdiction involving the same parties and issues
Applying section 7 of the Civil Procedure Act and John Florence Maritime Services, the court held that a plea of res judicata requires examination of the entire pleadings and record of the former suit. The defendants admitted the plaintiffs were different parties, and no prior case had addressed the tenants' rights under section 96(3)(e). The defendants should have filed a replying affidavit alongside the objection.
Legal principles established
#- A preliminary objection must raise a pure point of law and cannot be raised if any fact has to be ascertained or if the exercise of judicial discretion is sought (Mukisa Biscuits threshold)
- Jurisdiction is everything; a court without jurisdiction must down its tools
- The ELC has jurisdiction over disputes relating to the exercise of a chargee's statutory power of sale over land, including where the legality of the charge or the manner of disposal of charged land is questioned
- Under section 96(3)(e) of the Land Act 2012, tenants and sub-tenants of charged property are entitled to notice of an intended sale and have locus standi to challenge non-compliance
- Res judicata requires identical parties, subject matter and cause of action, and must be assessed against the entire pleadings and record of the former suit
- It is permissible to challenge the same transaction on different grounds without offending res judicata
Court orders
#- 1.The Notice of Preliminary Objection dated 18th May 2022 by the 2nd and 3rd Defendants/Respondents is dismissed for lack of merit
- 2.Declaration that the Court has original and unlimited jurisdiction under Article 162(2)(b) of the Constitution, Sections 3 & 13 of the ELC Act, Section 101 of the Land Registration Act and Section 150 of the Land Act to hear and determine the issues raised in the suit
- 3.The Notice of Motion application dated May 12, 2022 by the Plaintiffs/Applicants, being unopposed, is allowed in terms of Prayers 3 and 4 (interim injunction pending hearing and determination of the suit)
- 4.Suit to be fixed for hearing within 90 days; defendants granted 7 days to file and serve statements of defence and/or counterclaim and comply with Order 11 case management
- 5.Plaintiffs granted 3 days leave to file replies to statements of defence/counterclaim and further documents/witness statements
- 6.Mention on July 30, 2022 for compliance, pre-trial conference and fixing a hearing date
- 7.Costs of the application to be in the cause
- Jurisdiction invoked
- Article 162(2)(b) of the Constitution; Sections 3 & 13 of the Environment and Land Court Act, No. 19 of 2011; Section 101 of the Land Registration Act, No. 3 of 2012; Section 150 of the Land Act, No. 6 of 2012
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kitsao & another v TSS Investment Limited & 2 others (Environment & Land Case 51 of 2022) [2022] KEELC 3058 (KLR)", Case Analysis (2022). ELC Case of 2022 (Mombasa) - suit filed 13th May 2022; Notice of Preliminary Objection dated 18th May 2022. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/3058/eng@2022-05-24
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.