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ELCStruck OutEnvironment & Land Case E090 of 2022· [2023] KEELC 17667 (KLR)

Wakabu v Kiambu Unity Savings and Credit Co-operative Society Limited & another

Environment and Land Court
25 May 2023
BEB M Eboso
721 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~3 min to read original · ~4 min brief

The bottom line

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A landowner's bid to stop a Sacco auction failed because charge disputes belong in the High Court, not the Environment and Land Court.

What this practically means

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Executive summary

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Edward Waweru Wakabu sued Kiambu Unity Savings and Credit Co-operative Society Limited and the Land Registrar-Kiambu by plaint dated 29 July 2022, seeking among other reliefs an interlocutory injunction restraining the 1st defendant from auctioning land parcel Kabete/Nyathuna/2006 in exercise of the chargee's statutory power of sale. The 1st defendant in turn sought striking out of the suit by a motion dated 16 September 2022. Both motions were reserved for ruling and canvassed by written submissions. Before delivering the ruling, the court noticed that the dispute revolved around a legal charge over the suit property, and that a discharge-of-charge entry in the register had been judicially declared fraudulently procured. The court therefore invited the parties to address it on jurisdiction. The plaintiff did not attend; counsel for the 1st defendant conceded that the court lacked jurisdiction. Relying on the Court of Appeal's decision in Diamond Trust Bank Kenya Limited v FHH, which held that restraining a chargee's statutory power of sale is a commercial matter for the High Court, and applying the Owners of Motor Vessel 'Lillian S' principle, the court held that the dominant issue - the charge and the discharge of the discharge - fell outside its jurisdiction. The suit was struck out for want of jurisdiction. No costs were awarded, the court attributing the situation partly to the current definition of 'court' in the Land Act, 2012. The ruling was delivered virtually at Thika on 25 May 2023 by B M Eboso, J.

Key legal issues

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01

Jurisdiction of the ELC over charge/mortgage disputes

Holding

The ELC lacks jurisdiction where the dominant issue is a legal charge and the chargee's statutory power of sale; such disputes belong to the High Court

Reasoning

The court observed that the dispute revolved around a legal charge created over the suit property, with a discharge of charge entry later declared fraudulently procured. Relying on Diamond Trust Bank Kenya Limited v FHH, the Court of Appeal had held that restraining exercise of statutory power of sale is a commercial matter for the High Court. The dominant issue in the pleadings related to the charge and discharge of the discharge, placing the matter outside ELC jurisdiction.

p. 2
02

Consequence of lack of jurisdiction

Holding

The suit must be struck out; the court cannot make any other proposal on the plaintiff's behalf

Reasoning

Applying the Owners of Motor Vessel 'Lillian S' principle, once jurisdiction is absent the court must down its tools. Since the plaintiff did not attend to make submissions or propose an alternative forum, the only available course was to strike out the suit for want of jurisdiction rather than transfer it.

p. 2

Legal principles established

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  • Disputes relating to charges, including restraining a chargee from exercising its statutory power of sale, are commercial matters for the High Court and outside the jurisdiction of the Environment and Land Court
  • Where a court lacks jurisdiction, it must down its tools and cannot proceed on the merits

Court orders

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  1. 1.The plaintiff's suit is struck out for want of jurisdiction
  2. 2.No award of costs - each party to bear own costs (no costs awarded in the suit)

Authorities

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Legislation

  • Land Actdefinition of "court"

Cases cited (3)

  • Diamond Trust Bank Kenya Limited v FHH
    Civil Appeal 18 of 2020 [2022] KECA 769 (KLR)

    Restraining exercise of statutory power of sale under a charge is a commercial matter for the High Court, not the ELC

  • Co-operative Bank of Kenya Limited v Patrick Kangethe Njuguna & 5 others

    Authority followed in Diamond Trust Bank that charge-related disputes are commercial matters for the High Court

  • Owners of Motor Vessel "Lillian S" v Caltex Oil (Kenya) Ltd
    [1989] eKLR

    A court without jurisdiction must down its tools

Jurisdiction invoked
Article 162(2)(b) of the Constitution (Environment and Land Court) - jurisdiction found wanting; dispute held to be a commercial matter for the High Court

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, "Wakabu v Kiambu Unity Savings and Credit Co-operative Society Limited & another", Case Analysis (2023). Environment & Land Case E090 of 2022. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2023/17667/eng@2023-05-25

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