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ELCDismissedEnvironment and Land Case Civil Suit E65 of 2022· [2023] KEELC 19960 (KLR)

Telkom Kenya Limited v Roka Trading Company Limited & 5 others

Environment and Land Court
21 September 2023
6,620 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~26 min to read original · ~4 min brief

The bottom line

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Kenya's Environment and Land Court dismissed a bid to throw out Telkom Kenya's rent suit, confirming that objections based on disputed facts fail.

What this practically means

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Executive summary

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This ruling by L. A. Omollo, J of the Environment and Land Court at Nakuru determined the Defendants' Notice of Preliminary Objection dated 16th January 2023 in a suit by Telkom Kenya Limited seeking a permanent injunction, rent arrears of Kshs 39,401,462.26, specific performance and damages over property known as Nakuru/Municipality/Block 5/19, pursuant to a lease dated 4th December 2017 for a ten-year term. The Defendants objected on six grounds: lack of jurisdiction (contending the tenancy was a controlled tenancy triable by the Business Premises Rent Tribunal under Cap 301), fatal incompetence, misjoinder of the 2nd to 6th Defendants as mere shareholders, breach of separate corporate personality per Salomon v Salomon, want of authority/resolution to file suit, and absence of a cause of action against the 2nd to 6th Defendants. The Plaintiff countered that the lease was for ten years, contained no termination provision within five years other than for breach of covenant, and that as a state corporation wholly owned by government the tenancy fell outside the controlled tenancy definition; further, that misjoinder cannot defeat a suit under Order 1 Rule 9, and that a resolution authorising suit may be filed any time before hearing. Applying Mukisa Biscuit Manufacturing Co Ltd v West End Distributors and Oraro v Mbaja, the court held the objection raised disputed factual issues - whether the tenancy was controlled, its termination provisions, and the Plaintiff's legal status - requiring evidence. Misjoinder was a matter of defence, and the resolution filed before hearing cured any defect in authority. The preliminary objection was dismissed with costs to the Plaintiff. The substantive suit and the interlocutory injunction application remain pending.

Key legal issues

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01

Whether the preliminary objection met the Mukisa Biscuits threshold of a pure point of law

Holding

It did not; the grounds raised disputed factual questions on the nature of the tenancy, the plaintiff's status and joinder

Reasoning

The court found it unclear whether the tenancy was controlled, whether it contained a termination provision within five years, and what the plaintiff's legal status is. These are contested factual matters requiring evidence and interpretation, so they cannot be resolved on a preliminary objection.

p. 12
02

Whether misjoinder of the 2nd to 6th Defendants and breach of separate corporate personality justify striking out the suit

Holding

No; misjoinder is a matter of defence and a suit cannot be defeated by misjoinder or non-joinder

Reasoning

The court held that the objection on joinder of shareholders of the 1st Defendant should be considered as a defence rather than a preliminary objection, and reiterated the statutory position under Order 1 Rule 9 that misjoinder or non-joinder cannot defeat a suit.

p. 12
03

Whether want of authority/resolution at filing invalidated the suit

Holding

No; the resolution filed before the suit is set down for hearing cures the defect

Reasoning

Relying on Raymark Limited v John Lokorio citing Leo Investments, the court held that failure to file a resolution authorising filing of suit does not invalidate the suit, as the defect can be rectified by filing the resolution before hearing, consistent with Article 159(2)(d).

p. 13

Legal principles established

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  • A preliminary objection must not deal with disputed facts or derive its foundation from factual information to be tested by rules of evidence
  • A suit shall not be defeated by misjoinder or non-joinder of parties; misjoinder is a matter for defence, not a preliminary objection
  • A resolution authorising a corporation to file suit may be filed at any time before the suit is set down for hearing and cures any defect

Court orders

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  1. 1.The Preliminary Objection dated 16th January 2023 is dismissed with costs to the Plaintiff

Authorities

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Legislation

  • Constitution of KenyaArticle 162(2)(b); Article 159(2)(d)
  • Environment and Land Court ActSection 13; Section 19(1)
  • Landlord and Tenant (Shops, Hotels and Catering Establishments) ActSection 2(1); Section 15
  • Civil Procedure Rules, 2010Order 1 Rule 9
  • State Corporations ActSection 2
  • Interpretation and General Provisions ActSection 3
  • Companies Actgeneral

Cases cited (24)

  • Salomon vs Salomon
    (1897) AC 78

    Separate legal personality of a company and its shareholders

  • Al-Riaz International Limited Vs Ganjoni Properties Ltd
    [2015] eKLR

    Controlled tenancies governed by Cap 301

  • Speaker of the National Assembly Vs Karume
    (2008) 1 KLR 425

    Where a specific procedure is provided it must be followed

  • Samuel Kamau Macharia & Another Vs KCB & 2 Others
    Supreme Court Civil Application No 2 of 2011; [2012] eKLR

    Jurisdiction flows from the Constitution or legislation or both

  • Motor vessel M.V. Lillians vs Caltex Oil (Kenya) Limited
    (1989) LLR 1653

    A court without jurisdiction down its tools

  • Victor Mabachi & Another Vs Nurturn Bates Ltd
    Civil Appeal No 247 of 2005 [2013] eKLR

    Separate legal identities of company and shareholders

  • Fubeco China Fushun Vs Naiposha Company Limited & 11 others
    [2014] eKLR

    Requirement of authority/resolution for filing suit

  • Bugerere Coffee Growers Ltd Vs Sebaduka & Another
    [1970] E.A 147

    Authority to institute suit

  • Golden Mile Park Management Limited v Dreyan Investment Limited
    [2021] eKLR

    Authority/resolution requirement

  • Mukisa Biscuit Manufacturing Co Ltd v West End Distributors
    (1969) EA 696

    Definition and threshold of a preliminary objection

  • Cotton Roots Fashions Ltd v Veeral Shah & another
    [2021] eKLR

    Section 2(1)(b)(ii) is time based, not event based

  • Sunil Vinayk v Santokh Singh Mool Singh & 2 others
    [2017] eKLR

    Lease exceeding five years falls outside controlled tenancy

  • Maureen Onsongo v EOH Limited an EOH/Copy Cat Limited Company
    [2021] eKLR

    Misjoinder cannot defeat a suit

  • Pamela Ogalo Oguta National Bank of Kenya
    [2021] eKLR

    Nature of preliminary objections

  • Oraro V. Mbaja
    (2005) 1 KLR 141; 2005 eKLR

    Preliminary objection must not deal with disputed facts

  • Samuel Waweru v Geoffrey Muhoro Mwangi
    [2014] eKLR

    Preliminary objection threshold

  • Leo Investments Ltd v Trident Insurance Company Ltd
    (2014) eKLR

    Resolution may be filed any time before hearing

  • Raymark Limited v John Lokorio
    [2021] eKLR

    Defect of want of resolution curable before hearing

  • Republic v Registrar General & 13 Others
    (2005) eKLR

    Authority to institute proceedings

  • Khalif Jele Mohamed & another v Republic & another
    [2019] eKLR

    Blanket termination provision rendering tenancy controlled

  • Power General Contractors Limited v Pharmacy and Poisons Board
    [2021] eKLR

    Whether a state agency is Government under Cap 301

  • Kolaba Enterprise Ltd Vs Shamsudin Hussein Varvani & Anor
    (2014) eKLR

    Separate corporate personality as a question of law

  • Nitin Properties Ltd v. Singh Kalsi & another
    [1995] eKLR

    Preliminary objection raises a pure point of law

  • Hassan Ali Joho & another -Vs- Suleiman Said Shabal & 2 Others
    SCK Petition No. 10 of 2013 [2014] eKLR

    Definition of a preliminary objection

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, "Telkom Kenya Limited v Roka Trading Company Limited & 5 others", Case Analysis (2023). Environment and Land Case Civil Suit E65 of 2022. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2023/19960/eng@2023-09-21

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