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ELCDismissedNotice of motion dated April 23, 2021 (main suit number not stated in judgment)· [2022] KEELC 3823 (KLR)

Kariuki v Ringsview Apartments Limited & another (Environment & Land Case E140 of 2021) [2022] KEELC 3823 (KLR)

Environment and Land Court of Kenya
28 April 2022
2,854 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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A Nairobi buyer couldn't stop his apartment being sold because he couldn't prove he paid the full purchase price.

What this practically means

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Executive summary

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This is a ruling of the Environment and Land Court at Nairobi (L. Komingoi J) delivered on April 28, 2022 on a notice of motion dated April 23, 2021 by the plaintiff, Macharia Kariuki, seeking a temporary injunction pending trial restraining the defendants from selling or interfering with Apartment C6 on LR No 4858/11. The plaintiff had contracted in October 2013 to buy the apartment from the 1st defendant for Kshs 11,500,000, paying a deposit of Kshs 5,000,000, and was in occupation through a tenant. The 1st defendant, which had charged the parent title to secure a Kshs 90,000,000 facility from the 2nd defendant, was facing realization of that security. The 1st defendant opposed, contending the purchase price was unpaid, the applicant's occupation was unlawful, and raising the arbitration clause in the sale agreement and unstamping of the agreement. The 2nd defendant contended the applicant was a stranger to the charge and that its statutory power of sale was properly exercisable. The court framed two issues: whether the application met the threshold for a temporary injunction, and costs. Applying Giella vs Cassman Brown, Mrao and Kenleb Cons, the judge found the applicant failed to prove payment of the full purchase price, did not disclose why he failed to complete, had no crystallized rights, and therefore no prima facie case; failed to show irreparable harm not compensable in damages; and the balance of convenience favoured the 2nd defendant chargee. The application was dismissed with costs to abide the outcome of the main suit.

Key legal issues

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01

Whether the applicant established a prima facie case with a probability of success

Holding

No. The applicant failed to prove payment of the full purchase price and did not disclose why he failed to complete the purchase; his rights over the suit property had not crystallized.

Reasoning

The sale agreement dated October 31, 2013 shows staged payments. The applicant asserted in his supplementary affidavit that the purchase price was paid in full but attached no deposit slips or proof. The 1st defendant's averments that he failed to pay the full purchase price and took possession without authority were unchallenged. The court thus found no prima facie case per the Mrao test.

p. 6
02

Whether the applicant demonstrated irreparable harm not compensable by damages

Holding

No. The applicant failed to show he would suffer substantial loss incapable of being compensated by an award of damages.

Reasoning

The court found the applicant had not demonstrated substantial loss. It noted instead the 1st defendant's claim of mesne profits from the applicant's occupation, and agreed with the 2nd defendant that the applicant was not privy to the loan/charge arrangement and had not shown irregularity, illegality or fraud in the charge or the exercise of the statutory power of sale.

p. 6
03

Where the balance of convenience lies

Holding

The balance of convenience tilts in favour of the 2nd defendant/respondent chargee.

Reasoning

Applying Paul Gitonga Wanjau vs Gathuthi Tea Factory, the court weighed the greater harm. The 2nd defendant holds a registered charge and is realising its security; the applicant was not party to the charge arrangements and had not shown the charge was created irregularly, illegally or fraudulently.

p. 6

Legal principles established

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  • In an application for injunction the onus is on the applicant to satisfy the court that it should grant an injunction, on the Giella vs Cassman Brown principles
  • An applicant for injunction must make a full and frank disclosure of all relevant facts and show a right, legal or equitable, requiring protection

Court orders

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  1. 1.The notice of motion dated April 23, 2021 is dismissed
  2. 2.The costs of the application do abide the outcome of the main suit

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 40
  • Constitution of Kenya, 2010Article 159(1)
  • Civil Procedure Act (Laws of Kenya)Sections 3, 3A and 63(e)
  • Civil Procedure RulesOrder 40 Rules 1 and 2
  • Arbitration Act, No 4 of 1995Section 10
  • Stamp Duty ActSection 19(1)

Cases cited (18)

  • Nguruman Ltd vs Jan Bonde Nelsen & 2 Others
    [2014] eKLR
  • Mrao Ltd vs First American Bank of Kenya Ltd & 2 Others
    [2003] KLR 125
  • Marple Brooks Project Company Ltd & Another vs I & M Bank Ltd
    [2019] eKLR
  • Royal Mabati Factory Ltd vs Imarisha Mabati Ltd
    [2018] eKLR
  • Nyutu Agrovet Limited vs Airtel Networks Kenya Limited & another; Ann Mumbi Hinga vs Victoria Njoki Gathara
    [2009] eKLR
  • Safaricom Ltd vs Ocean View Beach Hotel Ltd & 2 Others
    [2010] eKLR
  • Maxam Ltd vs Heineken East Africa Import Co Ltd & Another
    [2019] eKLR
  • Giella vs Cassman Brown & Co Ltd
    [1973] EA 358
  • American Cynamid Co Ltd vs Ethicon Limited
  • Mbuthia vs Jimba Credit Corporation Ltd
  • Moses C Muhia Njoroge & 2 Others vs Janes W Lesalai & 5 Others
  • Kenleb Cons Ltd vs New Gatitu Service Station Ltd & Another
    [1990] KLR 557
  • Maltex Commercial Supplies Ltd & Another vs Euro Bank (in liquidation)
    [2007] eKLR
  • Bii vs Kenya Commercial Bank Ltd
    [2001] KLR 458
  • Kenya Shell Ltd vs Kibiru
    [1986] KLR 410
  • Socfinac Company Limited vs Nephat Kimotho Muturi
    [2013] eKLR
  • Equatorial Commercial Bank Ltd & 2 Others vs Retreat Villas Ltd
  • Paul Gitonga Wanjau vs Gathuthi Tea Factory Co. Ltd & 2 Others
    [2016] eKLR
Jurisdiction invoked
Article 40 of the Constitution of Kenya, 2010; Order 40 Rules 1 and 2; Sections 3, 3A and 63(e) of the Civil Procedure Act

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, "Kariuki v Ringsview Apartments Limited & another (Environment & Land Case E140 of 2021) [2022] KEELC 3823 (KLR)", Case Analysis (2022). Notice of motion dated April 23, 2021 (main suit number not stated in judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/3823/eng@2022-04-28

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