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ELCOtherKapsabet ELCA (MCELC No. 53 of 2018)· [2023] KEELC 933 (KLR)

Equity Bank Limited v Chepkwony & 4 others (Environment and Land Appeal 14 of 2021) [2023] KEELC 933 (KLR)

Environment and Land Court
16 February 2023
MMM. N. Mwanyale
947 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Environment and Land Court in Kapsabet ruled it cannot hear mortgage charge disputes, transferring this land appeal to the High Court.

What this practically means

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Executive summary

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In a suo moto ruling, the Environment and Land Court at Kapsabet considered whether it had jurisdiction over an appeal filed on July 13, 2021 against the entire judgment and decree in Kapsabet MCELC No. 53 of 2018. Directions had been issued on October 24, 2022 for the appeal to be determined by written submissions, with judgment scheduled for February 16, 2023. The Court, drawing on the Lilian's case and the Samuel Kamau Macharia decision, held that jurisdiction must be founded on the Constitution or statute, and that the ELC's jurisdiction under Article 162(2)(b) and Section 13 of the ELC Act covers environment and land-use and title disputes. Relying on Co-operative Bank of Kenya Limited v Patrick Kangethe Njuguna, the Court noted that mortgage and charge disputes do not concern land use and fall within the civil jurisdiction of the High Court. Examining the record of appeal, the Court found that the dispute concerned the validity of a legal charge over property Nandi/chepkongony/317 and the charge amount outstanding, with the plaintiff invoking the in duplum rule under section 44 of the Banking Act - a commercial banker-lender dispute. The Court therefore transferred the appeal to the High Court at Kapsabet and directed the Deputy Registrar to facilitate the transfer, with costs to await the outcome in the High Court.

Key legal issues

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01

Whether the ELC has jurisdiction over an appeal concerning the validity of a charge and the amount recoverable under it

Holding

The ELC lacks jurisdiction; the dispute is commercial and belongs to the High Court, and the appeal was transferred to the High Court at Kapsabet.

Reasoning

The Court adopted the Court of Appeal's decision in Co-operative Bank v Kangethe Njuguna, which held that a charge is a disposition, not a use of land, and that mortgage and charge disputes fall within the High Court's civil jurisdiction. Examining the plaint, the dispute was over the validity of the charge and the outstanding amount, raising the in duplum rule under section 44 of the Banking Act - a contractual banker-lender dispute, not a land-use dispute under Article 162(2)(b).

p. 3

Legal principles established

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  • Jurisdiction is everything; a court without jurisdiction must stop proceedings
  • The ELC lacks jurisdiction over mortgage and charge disputes; such disputes fall within the civil jurisdiction of the High Court

Court orders

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  1. 1.The appeal is transferred to the High Court at Kapsabet for hearing and determination
  2. 2.The Deputy Registrar to take necessary steps to facilitate the transfer to the High Court at Kapsabet
  3. 3.Costs of the appeal to await its outcome before the High Court

Authorities

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Legislation

  • Constitution of KenyaArticle 162(2)(b)
  • Environment and Land Court ActSection 13
  • Banking ActSection 44

Cases cited (3)

  • The Owners of the Motor Vessel “Lilians” -vs- Clatex Oil (Kenya) Limited
    (1989) eKLR
  • Samuel Kamau Macharia and Another –vs- Kenya Commercial Bank Limited and 2 others
  • Co-operative Bank of Kenya Limited –vs- Patrick Kangethe Njuguna and 5 others
    (2017) eKLR
On appeal from
Principal Magistrates' Court, Kapsabet
MCELC No. 53 of 2018
Jurisdiction invoked
Article 162(2)(b) of the Constitution and Section 13 of the Environment and Land Court 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, "Equity Bank Limited v Chepkwony & 4 others (Environment and Land Appeal 14 of 2021) [2023] KEELC 933 (KLR)", Case Analysis (2023). Kapsabet ELCA (MCELC No. 53 of 2018). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2023/933/eng@2023-02-16

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