Central Watch Company Limited & another v Embu Gaturi Housing Co-op Society Limited (Environment and Land Appeal E029 of 2023) [2024] KEELC 1251 (KLR)
The bottom line
#A Nairobi court upheld a tribunal's decision to raise commercial rents, ruling tenants could not rely on a consent their landlord's authorized organs never approved.
What this practically means
#Executive summary
#Key legal issues
#Effect and validity of the alleged consent of 6th October 2022
The consent was disregarded properly: it was an afterthought contrary to the parties' agreed position adopted by the tribunal, was not conceded by the Respondent, and was not executed with the authority of the cooperative society's recognized organ
The parties' advocates had agreed before the tribunal to dispose of the reference by valuation reports and submissions, and the tribunal adopted that position. Having taken that position, the Appellants could not claim a consent was ignored; if they believed there was a compromise, they ought to have applied to vary the directions. Further, the purported consent was not sanctioned by the authorized organ of the Respondent society, and the Appellants bore and failed to discharge the burden of proving such authority under Sections 107-109 of the Evidence Act.
Whether the tribunal's assessment of rents was based on lawful and credible material
Yes - the chairperson applied Section 9(2) of Cap 301, considered the applicable principles, and properly preferred the Respondent's comprehensive valuation report by M/s Danco Ltd over the Appellants' contradictory and scanty report
The court independently reviewed the Appellants' valuation report and found it lacking: comparables in the appendix had no stated locations or nature of business, and the report contradicted the references by placing the suit property on Tubman Lane rather than Biashara Street. The Respondent's Danco report provided comparables with exact locations. The tribunal was therefore entitled to rely on it and adopt the adjusted rents.
Whether grounds existed to interfere with the tribunal's exercise of discretion
No - rent assessment under Section 9(2) is a discretionary exercise, and the Appellants established no mistake of law, disregard of principle or misapprehension of fact warranting interference
Applying Karibu House v Travel Bureau Ltd and Mbogo v Shah, interference with a first-instance discretionary decision requires demonstration that it was clearly wrong or reached on improper principles. The chairperson was abreast of Section 9(2), evaluated the competing valuation reports, and gave well-explained, legally sound findings. No infraction was discerned.
Legal principles established
#- A company/body corporate can only act through its organs and make decisions by resolutions; acts not sanctioned by the authorized organ cannot bind it
- An appellate court may interfere with a tribunal's rent assessment only on limited grounds such as mistake of law, disregard of principle, misapprehension of fact or consideration of irrelevant matters
- A party who takes a position before a tribunal and has it adopted cannot later resile from it; they are estopped from canvassing an inconsistent position
Court orders
#- 1.The appeal is dismissed with costs to the Respondent
- On appeal from
- Business Premises Rent Tribunal (Honourable Tribunal)
- BPRT E466 of 2022 and E467 of 2022 (consolidated; E467 lead file)
- Jurisdiction invoked
- First appeal from the tribunal; jurisdiction to interfere with tribunal's discretionary rent assessment under Sections 9(2) and 12(1)(b) of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, Chapter 301
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Central Watch Company Limited & another v Embu Gaturi Housing Co-op Society Limited (Environment and Land Appeal E029 of 2023) [2024] KEELC 1251 (KLR)", Case Analysis (2024). Memorandum of Appeal dated 28th March 2023 (Business Premises Rent Tribunal Appeal, Nairobi). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/1251/eng@2024-03-07
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.