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ELCStruck OutPlaint dated 21st May 2024· [2024] KEELC 6439 (KLR)

Yurub Investments Limited v Diamond Trust Bank Kenya Limited & another (Environment and Land Case Civil Suit E203 of 2024) [2024] KEELC 6439 (KLR)

Environment and Land Court
3 October 2024
6,818 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~27 min to read original · ~4 min brief

The bottom line

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Kenya's Environment and Land Court struck out a suit challenging a bank's property sale, ruling such disputes belong in the High Court.

What this practically means

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Executive summary

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The Plaintiff sued by Plaint dated 21st May 2024 seeking a declaration that the sale of L.R No. 209/1063 - L.R 84749 by the 1st Defendant (a bank) to the 2nd Defendant was null and void, rectification of the register, delivery of the certificate of title, injunctions, general damages and costs. The 1st Defendant filed a notice of preliminary objection and a notice of motion dated 13th June 2024 seeking striking out of the suit for want of jurisdiction, res sub-judice contrary to Section 6 of the Civil Procedure Act, and abuse of process. The court framed three issues: jurisdiction, res sub-judice, and abuse of process. On jurisdiction, relying principally on Co-operative Bank of Kenya Ltd v Patrick Kang'ethe Njuguna and Bank of Africa Kenya Ltd v TSS Investment Ltd, the court held that the dispute arose from the exercise of the chargee's statutory power of sale, which falls within the civil jurisdiction of the High Court and not the Environment and Land Court, since charges and mortgages do not constitute 'use' of land under Article 162. On res sub-judice, the court found the same issues were live before the High Court in Nairobi HCC No. 139 of 2018 consolidated with HCC No. 451 of 2017. On abuse of process, the court found the suit was filed to circumvent High Court orders whose conditions the Plaintiff had failed to comply with, conferring a collateral advantage. All three grounds succeeded. The court allowed the application, struck out the Plaint, and awarded the 1st Defendant costs of the preliminary objection, the application and the suit, to be borne by the Plaintiff/Respondent.

Key legal issues

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01

Jurisdiction of the ELC over challenges to a chargee's statutory power of sale

Holding

The ELC lacks jurisdiction; the dispute stems from the exercise of statutory power of sale which belongs to the High Court

Reasoning

The court found the crux of the dispute concerned whether the chargee complied with the charge instrument in exercising its statutory power of sale. Relying on Co-operative Bank of Kenya Ltd v Patrick Kang'ethe Njuguna and Bank of Africa Kenya Ltd v TSS Investment Ltd, it held that charges and their realization do not amount to 'use' of land under Article 162, and thus fall outside ELC jurisdiction. The plaintiff was accordingly non-suited.

p. 8
02

Res sub-judice under Section 6 of the Civil Procedure Act

Holding

The suit is prohibited as res sub-judice since the same issues are live before the High Court in Nairobi HCC No. 139 of 2018 consolidated with HCC No. 451 of 2017

Reasoning

The court found the issues of the propriety of the statutory power of sale, validity of the sale and the transfer to the 2nd Defendant were live before the High Court, with related applications pending and stayed by the Court of Appeal. Applying the Supreme Court's enunciation of the sub-judice rule in KNCHR v Attorney General, it held the later suit should be stayed/struck out as the cause of action was substantially the same.

p. 10
03

Abuse of the due process of the court

Holding

Filing the suit amounted to an abuse of court process intended to circumvent orders the plaintiff had failed to comply with

Reasoning

The court found the plaintiff, having failed to comply with conditions attached to injunction orders in the High Court, filed this suit to circumvent those orders and obtain collateral advantage, creating a situation where the ELC would superintend High Court orders. Relying on Satya Bhama Gandhi and Rutongot Farm Ltd, it held the suit was a gross misuse of court process warranting intervention.

p. 12

Legal principles established

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  • Disputes concerning the exercise of a chargee's statutory power of sale fall within the civil jurisdiction of the High Court, not the Environment and Land Court
  • A court divested of jurisdiction must down its tools at the onset; proceedings conducted without jurisdiction are a nullity

Court orders

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  1. 1.The application dated the 13th June 2024 be and is hereby allowed.
  2. 2.The Plaintiff's suit vide Plaint dated the 21st May 2024 be and is hereby struck out.
  3. 3.The 1st Defendant/Applicant be and is hereby awarded costs of the preliminary objection; costs of the application and costs of the suit. Same to be borne by the Plaintiff/Respondent.

Authorities

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Legislation

  • Civil Procedure Act, Chapter 21 Laws of KenyaSections 6 and 7
  • Environment and Land Court ActSection 13(2)
  • Land ActSections 2, 80, 99, 150
  • Constitution of KenyaArticle 162
  • Employment and Labour Relations Court ActSection 12

Cases cited (15)

  • Co-operative Bank of Kenya Ltd v Patrick Kang'ethe Njuguna & 7 Others
    [2017] eKLR
  • Diamond Trust Bank Ltd v Fatuma Hasan Hadi
    Malindi Court of Appeal Civil Appeal No. 18 of 2020 [UR]
  • Bank of Africa Kenya Ltd & Another v TSS Investment Ltd & 2 Others
    (Civil Appeal E055 of 2022) [2024] KECA 410 (KLR)
  • Gladys Nthuku Nthuki v Lesshego Kenya Ltd; Mueni Charlse Maingi [Intended Plaintiff]
    [2022] eKLR
  • John Florence Maritime Ltd v The Cabinet Secretary Transport, & Infrastructure & 3 Others
    [2021] KESC 39
  • Mukisa Biscuit Ltd v Westend Distributors Ltd
    [1969] EA 696
  • Paramount Bank Limited v Vaqvi Syed Qamara & another
    [2017] eKLR
  • Phoenix of E.A. Assurance Company Limited v S. M. Thiga t/a Newspaper Service
    [2019] eKLR
  • In the Matter of the Interim Independent Electoral Commission (Applicant)
    (Constitutional Application 2 of 2011) [2011] KESC 1 (KLR)
  • Owners of Motor Vessel 'Lillian S' v Caltex Oil (Kenya) Limited
    [1989] KLR 1
  • Kakuta Maimai Hamisi v Peris Pesi Tobiko and Others
    [2014] eKLR
  • Kenya National Commission on Human Rights v Attorney General; Independent Electoral & Boundaries Commission & 16 others (Interested Parties)
  • Satya Bhama Gandhi v Director of Public Prosecutions & 3 others
    [2018] eKLR
  • Rutongot Farm Ltd v Kenya Forest Service & 3 others
    (Petition 2 of 2016) [2018] KESC 27 (KLR)
  • Kenya Section of the International Commission of Jurists v Attorney General & 2 Others
    Criminal Appeal No. 1 of 2012; [2012] eKLR
Jurisdiction invoked
Environment and Land Court Act, Section 13(2); Article 162 of the Constitution (as canvassed by the parties)

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, "Yurub Investments Limited v Diamond Trust Bank Kenya Limited & another (Environment and Land Case Civil Suit E203 of 2024) [2024] KEELC 6439 (KLR)", Case Analysis (2024). Plaint dated 21st May 2024. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/6439/eng@2024-10-03

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