Gichuhi & another v Progressive Credit & another

Environment and Land Court

18 September 2023

BEB M Eboso

676 words in judgment

View original judgment Read on Kenya Law Watch case

AI-assisted case brief

·~3 min to read original · ~4 min brief

The bottom line

The Environment and Land Court struck out a suit seeking to stop a property auction because mortgage disputes belong in the High Court, not the ELC.

What this practically means

Executive summary

The plaintiffs sued by plaint dated August 28, 2023, challenging Progressive Credit's exercise of the chargee's statutory power of sale over Dagoretti/Thogoto/1817, a residential property in Kiambu County registered in the name of the 1st plaintiff. They sought a permanent injunction restraining the 1st and 2nd defendants (Progressive Credit and Rising Sun Auctioneers) from auctioning, advertising or disposing of the property, a declaration that the threatened sale violated their rights, costs, and any other suitable relief. Together with the plaint they filed a notice of motion seeking interlocutory injunctive orders. On August 30, 2023 the court directed the parties to address it on its jurisdiction to adjudicate mortgage/charge disputes, and rival oral submissions were made: plaintiffs' counsel relied on Article 162(2)(b) of the Constitution, Section 13 of the Environment and Land Court Act and Section 78 of the Land Act; the defendants' counsel relied on Section 13 and the Court of Appeal decision in Co-operative Bank of Kenya Ltd v Kangethe. Holding that the suit challenged the statutory power of sale and not title to land, and that the Court of Appeal had twice held (Kangethe (2017) and Diamond Trust Bank v FHH (2022)) that charge/mortgage disputes fall outside the ELC's jurisdiction, Eboso J held himself bound by stare decisis, invoked the Lillian S principle, struck out the suit for want of jurisdiction and ordered the plaintiffs to bear the costs of the suit.

Key legal issues

Jurisdiction of the Environment and Land Court over charge/mortgage disputes

Holding

The court lacks jurisdiction to entertain a suit that principally challenges the chargee's exercise of the statutory power of sale where title to the suit property is not challenged.

Reasoning

Counsel for the plaintiffs relied on Article 162(2)(b), Section 13 of the Environment and Land Court Act and Section 78 of the Land Act; defence counsel relied on Section 13 and the Court of Appeal decisions in Kangethe and Diamond Trust Bank. The court held those Court of Appeal decisions binding: since the suit challenges the statutory power of sale and not title, the ELC has no jurisdiction and must down its tools per Owners of Motor Vessel 'Lillian S'.

p. 2

Legal principles established

Disputes relating to charges/mortgages fall outside the jurisdiction of the Environment and Land Court.
Superior courts below the Court of Appeal are bound by Court of Appeal pronouncements under the doctrine of stare decisis.

Court orders

1.The suit is struck out on the ground of want of jurisdiction.
2.The plaintiffs shall bear costs of the suit.

Authorities

Legislation

Constitution of KenyaArticle 162(2)(b)
Environment and Land Court ActSection 13
Land ActSection 78

Cases cited (3)

Co-operative Bank of Kenya Limited V Patrick Kangethe Njuguna & 5 others
(2017) eKLR
Disputes relating to charges/mortgages fall outside the jurisdiction of the Environment and Land Court.
Diamond Trust Bank Kenya Limited v FHH
[2022] KECA 769 [KLR]
Reiterated that charge/mortgage disputes fall outside the ELC's jurisdiction.
Owners of Motor Vessel “Lillian S” Vs Caltex Oil (Kenya) Ltd
[1989] eKLR
A court without jurisdiction must down its tools.

Jurisdiction invoked: Article 162(2)(b) of the Constitution and Section 13 of the Environment and Land Court Act (jurisdiction challenged; court held it lacked jurisdiction)

Key timeline

Practical implications

Frequently asked questions

Cite this brief

Caselaw, "Gichuhi & another v Progressive Credit & another", Case Analysis (2023). Environment & Land Case E030 of 2023. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2023/20203/eng@2023-09-18

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