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ELCAllowedEnvironment & Land Case E344 of 2022· [2023] KEELC 17492 (KLR)

ARC Packaging Limited & another v Sundries Bargains (Nairobi) Limited & another

Environment and Land Court
25 May 2023
OAO. A. Angote
3,645 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~15 min to read original · ~4 min brief

The bottom line

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A Kenyan court threw out emergency orders against a landlord because the tenants had already taken their rent dispute to the rent tribunal, not the court.

What this practically means

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Executive summary

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The 1st Defendant applied by notice of motion dated 28th February 2023 to vacate ex parte injunctive orders issued on 18th October 2022 restraining it from levying distress against the 2nd Plaintiff's manufacturing plant and from re-entering the suit premises, and to vacate directions issued on the Plaintiffs' contempt application dated 26th October 2022. The 1st Defendant argued the orders were open-ended, that the licence agreement had expired by effluxion of time on 5th September 2022 leaving no subsisting legal relationship, and that the orders created a free tenancy contrary to its Article 40 property rights. The Plaintiffs opposed, contending the licence created an 18-month controlled tenancy, that the 1st Defendant refused to issue ETR invoices as a condition precedent to rent payment, and that rent disputes in a controlled tenancy fall to the BPRT, which had already been seised of the dispute in Nrb BPRT/E863/2022. The court framed two issues: its jurisdiction and whether the orders should be vacated. It reviewed the law that ex parte orders are provisional and may be set aside for material non-disclosure, lack of jurisdiction or misleading of the court. Finding the orders were not open-ended but pending inter-parties hearing, the court nonetheless held that the Plaintiffs, having invoked the BPRT's jurisdiction, ought to have chosen one forum; the ex parte orders usurped the Tribunal's role. The application was allowed: the ex parte orders were set aside, the directions on the contempt application were vacated, and the Plaintiffs were ordered to pay the 1st Defendant's costs.

Key legal issues

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01

Whether the ELC had jurisdiction to entertain the suit given the pending BPRT proceedings over the tenancy

Holding

The court held that having filed a dispute before the BPRT and asserted that the Tribunal has jurisdiction over the tenancy, the Plaintiffs ought to allow the Tribunal to determine the issues; the ex parte orders usurped the Tribunal's role.

Reasoning

The Plaintiffs themselves asserted that the BPRT is empowered under Section 12(1)(e) of the Landlord and Tenant Act to determine rent disputes in a controlled tenancy, and had filed BPRT E863/2022. The court noted that the BPRT, being a subordinate court under Article 169(1)(a) of the Constitution, can issue injunctive and conservatory orders under Section 3A of the Civil Procedure Act and Order 40. The reliefs in the Plaint made no reference to the BPRT, yet the Plaintiffs had chosen that forum for the tenancy dispute.

p. 7
02

Whether the ex parte orders of 18th October 2022 should be vacated

Holding

The orders were set aside. They were not open-ended but issued pending inter-parties hearing; however, since the Plaintiffs ought to have pursued the BPRT forum, the orders were discharged.

Reasoning

The court reviewed the law on setting aside ex parte orders, noting they are provisional and may be discharged on material non-disclosure, abuse of process, or lack of jurisdiction. It found the orders subsisted due to the 1st Defendant's own conduct regarding the contempt application and consent of 16th November 2022, but ultimately allowed the application because the Plaintiffs had elected the BPRT forum for the tenancy dispute.

p. 6

Legal principles established

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  • Ex parte injunctive orders are provisional and may be set aside on material non-disclosure, lack of jurisdiction, or where the court was misled in fact or law.
  • A party who invokes the jurisdiction of the BPRT and files a dispute there should allow the Tribunal to determine the tenancy issues; a parallel suit in the ELC usurps the Tribunal's role.
  • The BPRT, as a subordinate court under Article 169(1)(a), has jurisdiction to issue injunctive or conservatory orders where properly seized of a dispute.

Court orders

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  1. 1.The ex-parte order issued on 18th October 2022 and variously extended by the Court be and is hereby set aside.
  2. 2.All directions issued on the hearing and determination of the Plaintiffs' Notice of Motion dated 26th October 2022 are vacated.
  3. 3.The Plaintiffs do pay the costs of the application to the 1st Defendant.

Authorities

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Legislation

  • Civil Procedure ActSection 1B(1)(a)-(d)
  • Civil Procedure ActSection 3A
  • Civil Procedure RulesOrder 40
  • Value Added Tax (Electronic Tax Invoices) Regulations
  • Value Added Tax ActSection 63
  • Landlord and Tenant (Shops, Hotels and Catering Establishments) ActSection 12(1)(e)
  • Law of Contract ActSection 3(3)
  • Constitution of Kenya 2010Article 169(1)(a)
  • Constitution of Kenya 2010Article 40

Cases cited (5)

  • Aga Khan Education Service Kenya vs Republic Exparte Ali Seif & 3 Others
    [2004] eKLR

    Jurisdiction to set aside ex parte orders is limited and exercised sparingly on clear cut cases.

  • Esther Muthoni Passaris vs Charles Kanyuga & 2 Others
    [2015] eKLR

    Court may vacate ex parte orders where a party failed to disclose material facts.

  • Judicial Commission of Inquiry to the Goldenberg Affair & Others vs Job Kilach
    [2003] eKLR

    Ex parte orders are essentially provisional; judge may review them on inter partes argument without hearing an appeal from himself.

  • John Mugo Ngunga vs Margaret M Murangi
    [2014] eKLR

    BPRT has jurisdiction to grant injunctions as provided by the Act.

  • Republic vs Chairman Business Premises Rent Tribunal; Audio Corner Limited (Interested Party) Ex parte Thande Holdings Limited
    [2020] eKLR

    Where the Tribunal is properly seized of a dispute, it can issue injunctive or conservatory orders.

Jurisdiction invoked
Environment and Land Court jurisdiction under the Environment and Land Court Act over disputes relating to land and tenancies; Article 169(1)(a) of the Constitution discussed on status of tribunals

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, "ARC Packaging Limited & another v Sundries Bargains (Nairobi) Limited & another", Case Analysis (2023). Environment & Land Case E344 of 2022. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2023/17492/eng@2023-05-25

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