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ELCOtherEnvironment & Land Case E005 of 2021 (Formerly Eldoret ELC No. 719 of 2012)· [2023] KEELC 16581 (KLR)

Muyuka & another v Barclays Bank of Kenya & 2 others

Environment and Land Court of Kenya
29 March 2023
MMM. N. MWANYALE
1,210 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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What this practically means

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Executive summary

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This ruling arose from a jurisdictional question the court raised suo moto on 20 February 2023: whether the Environment and Land Court at Kapsabet had jurisdiction over a suit involving a legal charge registered by Barclays Bank of Kenya (1st Defendant), who exercised statutory power of sale, and a claim against Pan African Life/Sanlam (3rd Defendant) for payment of an outstanding balance under an insurance cover. Parties filed submissions: the Plaintiffs and 3rd Defendant maintained the ELC was properly seized since the dispute involved an instrument in land (with the Plaintiffs alternatively seeking transfer to the High Court); the 1st Defendant submitted the High Court was the proper forum, relying on Co-operative Bank of Kenya Ltd v Patrick Kangethe Njuguna. Applying that Court of Appeal authority, MWANYALE J 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 under Article 165(3). The insurance claim likewise required probing the insurer-insured relationship and policy terms, a commercial matter outside ELC jurisdiction. Invoking Article 159 of the Constitution and Sections 1A and 1B of the Civil Procedure Act, and noting the matter's age (originally Eldoret High Court Civil Case No. 90 of 2011), the court directed transfer of the suit to the High Court at Kapsabet for final determination, with the Deputy Registrar to facilitate the transfer and costs to await the outcome before the High Court.

Key legal issues

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01

Whether the ELC has jurisdiction over a dispute arising from a legal charge and statutory power of sale

Holding

It does not; charge disputes fall within the High Court's civil jurisdiction per Co-operative Bank v Kangethe Njuguna

Reasoning

The court relied on the Court of Appeal's holding that a charge is a disposition in land, not a use of land, and that contracts within section 13 of the ELC Act must be incidental to the use of land, excluding mortgages, charges, collection of dues and rents. The amended pleadings showed the dispute emanates from a charge under which the 1st Defendant exercised statutory power of sale.

p. 3
02

Whether the claim against the 3rd Defendant under an insurance cover is within ELC jurisdiction

Holding

It is not; probing the insurer-insured relationship and policy terms is a commercial dispute for the High Court under Article 165(3)

Reasoning

The court held that determining whether an insurer-insured relationship existed and the terms of the policy was not contemplated by the Constitution or the ELC Act to fall within ELC jurisdiction. Article 165(3) donates unlimited original jurisdiction in civil matters to the High Court, making it the proper forum for such commercial disputes.

p. 3
03

Whether, lacking jurisdiction, the matter should be transferred rather than struck out

Holding

Transferred to the High Court at Kapsabet in the interest of substantive justice, invoking Article 159 and Sections 1A and 1B of the Civil Procedure Act

Reasoning

Given the age of the matter, originally filed as Eldoret High Court Civil Case No. 90 of 2011 and transferred to the ELC before the 2017 Co-operative Bank decision, the court invoked the overriding objective and Article 159 to direct transfer to the High Court rather than defeat the suit for want of jurisdiction.

p. 3

Legal principles established

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  • Without jurisdiction, a court acts in vain and its engagements are a nullity
  • A court only exercises jurisdiction conferred by the Constitution or legislation
  • Mortgage and charge disputes fall within the civil jurisdiction of the High Court, not the ELC

Court orders

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  1. 1.The matter be transferred to the High Court at Kapsabet for final determination
  2. 2.The Deputy Registrar to take necessary steps to facilitate the transfer
  3. 3.Costs shall await the outcome before the High Court

Authorities

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Legislation

  • Constitution of KenyaArticle 162(2)(b)
  • Constitution of KenyaArticle 165(3)
  • Constitution of KenyaArticle 159
  • Environment and Land Court ActSection 13
  • Civil Procedure ActSections 1A and 1B

Cases cited (2)

  • Co-operative Bank of Kenya Limited Vs Patrick Kangethe Njuguna & 5 others
    (2017) eKLR

    ELC lacks jurisdiction over mortgage/charge disputes; such disputes fall within the High Court's civil jurisdiction

  • The Owners of the Motor Vessle “Lilian S” Vs Caltex Oil (Kenya) Limited
    (1989) eKLR

    Locus classicus that without jurisdiction a court acts in vain and its engagements are a nullity

Jurisdiction invoked
Article 162(2)(b) of the Constitution and section 13 of the Environment and Land Court Act; transfer jurisdiction under Article 159 and Sections 1A and 1B of the Civil Procedure Act

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (2)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Muyuka & another v Barclays Bank of Kenya & 2 others", Case Analysis (2023). Environment & Land Case E005 of 2021 (Formerly Eldoret ELC No. 719 of 2012). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2023/16581/eng@2023-03-29

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