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ELCOtherNot stated in the judgment· [2024] KEELC 6835 (KLR)

Patel & another v Limuru Hills Limited & another (Environment & Land Case E027 of 2021) [2024] KEELC 6835 (KLR)

Environment and Land Court
15 October 2024
JKJ G Kemei
2,182 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Environment and Land Court confirmed it can hear a land sale dispute even after the bank sold the property during the case.

What this practically means

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Executive summary

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By a Plaint dated 25/2/2021, the Plaintiffs sued for a permanent injunction restraining the Defendants from selling, transferring or disposing of Log Home No. 19 (on L.Rs 4967/37 and 4967/38) and for specific performance of a sale agreement dated 26/5/2017, requiring completion of the unit sold off-plan and partial discharge by the 2nd Defendant, a chargee. The Plaintiffs' interim injunction was dismissed on 9/2/2022 and the suit suffered multiple adjournments; on 19/2/2024 the parties agreed the suit property had been sold by the 2nd Defendant in October 2023, and the Plaintiffs filed an application to amend their Plaint. Sua moto, the Court directed the parties to address jurisdiction before hearing that application. The Plaintiffs submitted the Court had jurisdiction under section 12(2) of the ELC Act, or alternatively should transfer the suit under section 18 of the Civil Procedure Act since the amended claim would be for refund of deposit and loss of bargain. The 2nd Defendant contended the substratum was lost on the sale and that ELC jurisdiction excludes mortgage and charge matters, relying on Co-operative Bank v Kangethe. The Court distinguished that authority: the Plaintiffs raised no accounting questions and did not challenge the statutory power of sale; their claim was for completion of the sale agreement with the 1st Defendant. Holding that jurisdiction exists or not ab initio and cannot be conferred by consent, the Court found it has jurisdiction over the suit as currently filed, declined to consider the draft amended Plaint, and made no orders as to costs. The jurisdictional question was decided without disturbing any other interlocutory application.

Key legal issues

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01

Whether the ELC's jurisdiction is ousted because the suit property was sold by the chargee in exercise of statutory power of sale and the prayers are said to be commercial in nature

Holding

The Court held it has jurisdiction because the plaintiffs' cause of action is completion of the sale agreement with the 1st Defendant and partial discharge of the suit unit, not an accounting question or a challenge to the statutory power of sale

Reasoning

The Court distinguished Co-operative Bank v Kangethe, noting that in that case the dispute involved accounting questions over charges and a challenge to the exercise of statutory power of sale. Here, the plaintiffs neither raised accounting questions over the 2nd Defendant's charges nor challenged the statutory sale; their claim is for completion of the sale agreement dated 26/5/2017 with the 1st Defendant and an order compelling partial discharge, a dispute relating to contracts granting enforceable interests in land under section 13 of the ELC Act.

p. 5
02

Whether the proposed amendment of the Plaint affects the jurisdictional analysis

Holding

The Court declined to consider the draft amended Plaint, confining itself to the suit as currently filed

Reasoning

There is a pending application dated 15/2/2024 seeking leave to amend the Plaint, which has not been heard and determined. The Court therefore declined the 2nd Defendant's submissions premised on the draft amended Plaint and determined jurisdiction solely on the Plaint dated 25/2/2021.

p. 4

Legal principles established

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  • Jurisdiction is a pure question of law that goes to the root of a matter and must be resolved on a priority basis
  • Jurisdiction either exists or it does not; it cannot be conferred by consent of the parties and may be raised at any stage of the proceedings

Court orders

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  1. 1.A declaration that the Court has requisite jurisdiction over the suit as currently filed
  2. 2.No orders as to costs

Authorities

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Legislation

  • Constitution of KenyaArticle 162
  • Environment and Land Court ActSection 12(2)
  • Environment and Land Court ActSection 13
  • Civil Procedure ActSection 18
  • Land ActSection 150

Cases cited (6)

  • Co-operative Bank of Kenya Ltd v Patrick Kangethe Njuguna & 5 Others
    [2017] eKLR
  • Equity Bank Limited vs Bruce Mutuku T/A Diani Tour & Travel
    [2016] eKLR
  • Mary Wambui Munene v Peter Gichuki Kingara and Six Others
    Petition No. 7 of 2013 [2014] eKLR
  • Owners of Motor Vessel ‘Lilian S’ v Caltex Oil Kenya Ltd
    [1989] eKLR
  • Jamal Salim v Yusuf Abdulahi Abdi & Another
    Civil Appeal No. 103 of 2016 [2018] eKLR
  • Adero & Another v Ulinzi Sacco Society Limited
    [2002] 1 KLR 577
Jurisdiction invoked
Article 162(2)(b) of the Constitution of Kenya 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, "Patel & another v Limuru Hills Limited & another (Environment & Land Case E027 of 2021) [2024] KEELC 6835 (KLR)", Case Analysis (2024). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/6835/eng@2024-10-15

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