Salim Awadh & 34 Others v Registered Trustees of Teleposta Pension Scheme

c. A declaration that the decision of the Defendant not to oer the Plaintis the rst priority or no oer at all to purchase the ats situated within Jogoo Road is unlawful, discrimination and is ultra vires the Defendants terms and/or conditions of oer of its houses and the same is for rescinding. A declaration that the Defendant is estopped through the doctrine of equitable estoppel from alienating the Plaintis priority to purchase their respective houses. d. An order of permanent injunction restraining the Defendants, its servants and/or agents from threatening to evict and/or otherwise interfere with the Plaintis quiet and peaceful possession of the suit premises situated at Jogoo Road. e. An order of specic performance compelling the Defendant to issue a letter of oer to the Plaintis in respect of the suit premises within Jogoo Road. f. Costs of the suit to be borne by the Defendant. g. Any other relief that this Honourable Court may deem t to grant. 2. This suit was instituted by 35 Plaintis whose case was that at all material times, the 1st -25th Plaintis are and have been tenants in the Defendants’ houses located along Jogoo Road while the 26th to 35th Plaintis are and have been tenants in the Defendant’s houses located along Elgeyo Marakwet Road (herein known as the suit properties). 3. The Plaintis averred in the Plaint that vide the letters of 26th April, 2002 and 25th October, 2002, the Defendant oered its various houses for sale to members of its scheme, including the Plaintis, in which the right to purchase the houses was rst allocated to the sta occupying the premises on the terms therein. 4. It was averred by the Plaintis that upon receipt of the letters of oer, they lled the prescribed form A and duly forwarded it to the management of the Defendant anticipating a response on the same; that the decision to oer the houses for sale to the Plaintis was arrived at after serious deliberation and that it was an express condition that the houses be disposed o and the occupants be given priority over other purchasers. 5. The Plaintis averred that contrary to their expectations and in breach of the contract, the Defendant decided to oer the subject houses for sale to other persons and that the Defendant has unilaterally increased the rent. 6. Other particulars of breach by the Defendant include purporting to alienate the Plaintis’ priority right of purchasing their respective houses and oering them for sale to other persons and refusing to accept rent from the Plaintis. It was averred by the Plaintis that their families have been living in the houses and have no alternatives and that they are willing to make payments to secure the rst opportunity to purchase the suit properties. 7. Vide its Defence of 10th February, 2009, the Defendant denied the Plaintis’ averments stating that its letter of 25th October, 2003 was merely an expression of interest by the Defendant to the occupants of its houses requesting them to conrm interest in purchasing the houses and that the letter did not create any binding relationship. 8. It was averred by the Defendant that Form A merely conrmed the occupants’ interest in purchasing the houses; that the Defendant is entitled by law to charge rent for its premises at market rates; that the Defendant did not coerce the Plaintis to sign tenancy agreements and that the Plaintis sought in HCC 969 of 2005 an order to stop the Defendant from charging monthly rent of Kshs 17,000. https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/13631/eng@2022-10-13 2

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9. It is the Defendant’s case that the court in HCCC No. 969 of 2005 found that the Plaintis are bound by the Scheme’s decision to increase rent and required them to sign new tenancy agreements and further that the Plaintis have no vested right in the houses occupied and/or other houses of the scheme and that the decision of the court remains unchallenged and is binding on the Plaintis. Hearing & Evidence 10. The matter proceeded for hearing on 20th January, 2021. Plainti number 21, PW1, informed the court that she was representing the Plaintis in this case; that she was employed by the then Kenya Posts and Telecommunication Corporation in 1986 as a typist and that when Kenya Posts and Telecommunication Corporation split in to three entities in 1999, she was assigned to work for Telkom Kenya where she continued working until her retrenchment in 2008. 11. PW1 informed the court that during her employment, she was allocated a two bedroomed house at Jogoo Road, being house number MC3 which she occupies to date; that the Defendant would automatically deduct rent from her salary through a check-o system and that sometime in 2003, the Defendant issued her and the other Plaintis a letter in which it requested them to express interest in buying the houses they occupied. 12. According to PW1, they lled the relevant documentation indicating their interest in the houses they were occupying and awaited oer letters which they did not receive prompting them to seek legal advice. 13. According to PW1, they proceeded to le a case in court; that the Court issued injunctive orders restraining the Defendant from selling the houses until the matter was determined; that whereas prior to their retrenchment they paid rent through the check-o system, after retrenchment they were asked to pay the rent at GPO Teleposta which declined to receive the rent and that they began paying rent to a company known as JIMCO but no receipts were issued to them. 14. PW1 testied that despite Court orders barring the Defendant from distressing for rent, the Defendant engaged auctioneers who distressed for rent and carried away their goods; that the Defendant later on issued them with a tenancy agreement which they declined to sign and that she is not a tenant and should be given priority as a purchaser to purchase the suit property. 15. In cross-examination, PW1 stated that she does not have a letter of allocation of the house from the Kenya Posts and telecommunication corporation; that she was allocated house no C3; that she does not have a letter of authority to represent the 34 Plaintis; that she duly lled Form A expressing interest to purchase the houses; that the Court did not prohibit them from paying rent and that the sample form A does not indicate that they should have been given priority to purchase the houses they were occupying. 16. Plainti number 18, PW2, informed the court that he was an employee of Kenya Posts and Telecommunication Corporation; that when it split, he was taken by Telkom Kenya where he retired on 8th February, 2008 and that he was allocated house C6 and paid rent by way of the check-o system. 17. According to PW2, after being retrenched in 2008, they were given letters of expression of interest to purchase the houses they occupied; that he signed form A which was attached to the letter and lled it in; that he took a copy of Form A before lling it and that he was never given an oer letter due to discrimination leading to the ling of this suit. 18. It was the evidence of PW2 that the court granted orders stopping the sale of the houses until determination of the suit; that he is entitled to purchase the house he stays in because he is a scheme https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/13631/eng@2022-10-13 3

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member and was an employee of Telkom Kenya and that the Defendant has been harassing them by sending auctioneers to distress for rent. According to PW2, he was testifying on behalf of Salim Awadha who was unable to get permission to attend court. 19. In cross-examination, PW2 testied that he is still a member of the pension scheme; that he occupies house no C6 on Jogoo Road which belongs to the Defendant; that he does not know when he stopped paying rent; that he does not know to whom he should pay rent and that he does not have a copy of the Form A which he lled. 20. PW2 informed the court that the Court Order did not stop them from paying rent; that the letter advertising the properties for sale was done while he was still living on the property; that he never signed the tenancy agreement neither did he pay rent nor surrender the house keys as advised and that he was unaware that some of the Plaintis signed tenancy agreements and were given oer letters. 21. DW1 testied that he has been with the pension scheme since 1999 and has been the administrator and Trust Secretary for 12 years; that the pension scheme pays pension benets to former employees; that the Plaintis were tenants in the Defendant’s premises and that they were issued with an expression of interest letter to buy the property by lling Form A if interested and return the same to the Defendant after which letters of oer would be issued. 22. It was the evidence of DW1 that the Plaintis did not return the lled Form A to the Defendant; that the lling of Form A did not create a contract; that vide the letter of 15th April, 2005, the Plaintis were informed that the Defendant had appointed a managing agent who would handle all matters and that rent was increased by the landlord and with eect from 1st July, 2005 and the Plaintis were to individually sign tenancy agreements and remit the rent directly to the Defendant. 23. According to DW1, the Plaintis have not been paying rent and attempts by the Defendant to distress for rent have been unsuccessful and that in total, the Defendant is owed the sum of Kshs 103,000,000 by the Plaintis. 24. During cross-examination, DW1 stated that the issue of rent has been determined; that the Plaintis had a priority because they were tenants and that they were to express interest in the purchase of the houses they were occupying by lling Form A if interested and Form B if not interested. 25. It was the evidence of DW1 that the Plaintis were to express interest in the houses in writing; that after July, 2005, each tenant was to clear the outstanding rent and pay 10% of the purchase price and the balance to be cleared within 90 days and that none of the Plaintis complied with these requirements. Submissions 26. The Plaintis’ advocate submitted that the Plaintis were allocated their houses by Kenya Posts and Telecommunication Corporation by virtue of being its employees, majority of whom have occupied the houses since the early 1990’s and that the Plaintis had legitimate expectation with respect to the purchase of the houses. 27. It was submitted by Counsel that the Plaintis were discriminated against by the Defendant; that the Plaintis as former employees of Teleposta have the same status as other members of the scheme who were given letters of oer to purchase their houses and that there is no justication for the unfair treatment. 28. It was submitted that the prayer for rent having been made during oral testimony is unwarranted as the same was never specically sought by way of a counter-claim as expressed in Order 7 Rule 7 of the Civil Procedure Rules. Reliance was placed on the case of W.W.W. vs P.M.M [2015] eKLR. https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/13631/eng@2022-10-13 4

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29. The Defendant’s advocate submitted that Order 1 Rule 13 of the Civil Procedure Rules requires that where a Plainti intends to act in a representative capacity, he must be authorized to do so in writing by other Plaintis; that having failed to adduce evidence of written authority, PW1 & PW2’s evidence was tendered in their personal capacity and that the Court should dismiss the suit as against the other Plaintis. 30. It was submitted that the suit against the Plaintis, other than PW1 & 2, should be dismissed for lack of evidence; that neither PW1 nor PW2 submitted the Form A’s purportedly signed and submitted to the Defendant demonstrating their interest in purchasing the properties and that in any event, the submission of Form A did not create any contractual obligation but was merely an expression of interest. 31. According to Counsel, the Plaintis are not entitled to permanent injunctive orders because they have failed to demonstrate that they had a rst priority to purchase the suit properties and that the prayers for injunction have equally been made in bad faith to prevent the Defendant from collecting rent due from the Plaintis since 2005. 32. Counsel for the Defendant submitted that specic performance is based on the existence of a valid enforceable contract; that the expression of interest was a mere invitation to treat and not a letter of oer creating legal obligations and that as such, it was not capable of being enforced. Analysis & Determination 33. Having considered the pleadings, testimonies and submissions by the parties herein, the following issues arise for determination; i. Whether PW1 & PW2 have the requisite locus to testify on behalf of the other Plaintis? ii. Whether the Plaintis were entitled to be given rst priority to purchase the suit properties? iii. Whether the Plaintis are entitled to the orders sought? 34. It is the Defendant’s case that PW1 and PW2 do not have the requisite locus standi to tender evidence as representatives of the other Plaintis for want of written authority pursuant to Order 1 Rule 13 of the Civil Procedure Rules and that subsequently, the testimonies by PW1 and PW2 were rendered in their personal capacities and should be considered as such. 35. The Plaint led herein relates to 35 Plaintis. It is not indicated in the Plaint that it is a representative suit. Where there are several Plaintis and/or Defendants, Order 1 Rule 13 of the Civil Procedure Rules, 2010 allows a single Plainti to be authorized and/or mandated to appear, plead or act on behalf of the rest of the Plaintis. It provides as follows: “ (1) Where there are more Plaintis than one, any one or more of them may be authorized by any other of them to appear, plead or act for such other in any proceeding, and in like manner, where there are more defendants than one, any one or more of them may be authorized by any other of them to appear, plead or act for such other in any proceeding. (2) The authority shall be in writing signed by the party giving it and shall be led in the case.” https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/13631/eng@2022-10-13 5

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36. The Court of Appeal in Chalicha Farmers Co-operative Society Limited vs George Odhiambo & 9 Others [1987] eKLR had occasion to consider a similar issue and stated thus; “ This suit raises some points to be considered in law. The rst is that when the summonses were served, only four entered appearances and led defences. At the time of the hearing two of those who led joint defences attended and participated in the hearing. One of those who neither entered appearance nor led defence attended and participated in cross-examining the plainti’s witnesses. Others never entered appearances or led defences or attended the hearing. Their claim is that they had appointed the rst respondent, George Odhiambo, as their spokesman. The question is, is that the proper procedure? If George Odhiambo was to represent them then, either Order 1 rule 8 or rule 12 of the Civil Procedure Rules should have been followed. It was not proper in that respect and the trial judge should not have allowed George Odhiambo to represent and proceed with the suit as he did. The appearance and defence of defendants (respondents) 1, 2 5 and 7 were prepared and led by an advocate and if the defences were on the basis of representative action, then the advocate should have stated so. The trial judge in allowing the suit to proceed as a representative suit caused miscarriage of justice in that the suit should have proceeded on formal proof and judgment entered for the plainti against those who did not enter appearance and/or led defences, and against those who did not attend at the trial. Judgment should have been entered against defendants 3 to 10…. George Odhiambo could not have been allowed to represent other defendants without written authority. This caused miscarriage of justice.” 37. In Stephen lolo Tathi & Others vs Mahahm Musa Kioko Ziwani Mosque & School Association[2003] eKLR, the High Court posited thus; “ Order 1 rule 12(1) stipulates that where there are more than one plainti any one or more than may be authorized by any other of them to appeal plead or act for such other in any proceeding. Order 1 rule 12(2) stipulates that the authority shall be in writing signed by the party giving it and shall be led in the case.” 38. More recently, the Court in Noor Ahmed Noor & 158 others vs Kenya Railways & another [2016] eKLR persuasively expressed itself as follows: “ From the foregoing, the salient requirements of an appearance of one of several Plaintis or Defendants, are to have a (i) written document (ii) signed by Plaintis or Defendants authorizing one of them to (iii) appear, plead or act, which must be (iv) led in the case. On perusal of the Plaintis’ bundle of documents in the Court record, there is a document titled “Authority to Act (Under Order 1 Rule 12 of the Civil Procedure Rules). The contents therein are very clear, that: the undersigned from the date thereof until the determination of the suit authorize Noor Ahmed Noor the 1st Plainti, to act, appear, execute/sign documents/pleadings relating to the suit and to instruct counsel/advocate on their behalf to prosecute the suit. The Authority is accompanied by a list of all the Plaintis who appended their signatures. Whilst it is not an express requirement, the Authority also has the descriptions of the rm from which it is drawn and led and whom to be served upon. I am satised that the provisions of Order 1 Rule 13 have been met and consequently nd that the point of objection fails.” https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/13631/eng@2022-10-13 6

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39. In the present circumstances, the Plaint was accompanied by the Verifying Adavit of the 1st and 25th Plaintis, sworn with the authority of the 2nd to 24th Plaintis. The written authority of the other Plaintis was not exhibited. 40. It therefore follows that the evidence by PW1 & PW2 is with respect to their individual cases and the cases of the other 23 Plaintis. What then happens to the rest of the Plaintis? It is a cardinal principle of law that he who alleges must prove. The failure by the other Plaintis to testify essentially means that their case was unprosecuted. As such, the only recourse open to this Court is to dismiss the same which it proceeds to do. The merit of the 1st to 25th Plaintis will be considered under the next head. 41. The Plaintis herein (PW1 & PW2) instituted this suit seeking inter-alia, for a declaration that the Defendant’s decision not to oer the Plaintis the rst priority or any oer to purchase the suit properties is unlawful and discriminatory and a declaration that the Defendant is estopped through the doctrine of equitable estoppel from alienating the suit properties without giving the Plaintis the rst priority. 42. It is the case of the Plaintis that they were employees of Kenya Posts and Telecommunication Corporation and later on Telkom Kenya; that during their tenure of employment, they were allocated houses whose rent they paid through a check-o system where it was automatically deducted from their salaries and that sometime in October 2003, they were issued with a request for expression of interest to purchase the houses they occupied, which they duly lled and submitted. 43. According to the Plainti, the above notwithstanding, the Defendant failed and/or refused to issue them with letters of oer, which action was discriminatory, and that as former employees and members of the pension scheme, they are entitled to be given the rst option of purchase. It is the Plainti’s case that the Defendant’s actions in refusing to oer them the houses to sale breached their legitimate expectation. 44. In response, the Defendant maintains that the letters of expression of interest did not create legal obligations, the same being merely an invitation to treat; that in any event, neither PW1 nor PW2 produced in evidence Form A that they lled and purportedly sent to the Defendant and that its failure to issue letters of oer to the Plaintis did not breach any contractual obligations. 45. According to the Defendant, the Plaintis are not entitled to any injunctive orders, the said prayer having been made in bad faith and the Plaintis having come to court with unclean hands by virtue of not having been paying rent. 46. The principle of legitimate expectation has been the subject of court discourse. The Supreme Court of Kenya in Petition No. 14 of 2014, Communications Commission of Kenya & 5 others vs Royal Media Services Limited & 5 others pronounced itself on the principle as follows:“ Legitimate expectation” is a doctrine well recognized within the realm of administrative law, as is clear from the English case, In re South African Veterinary Council vs Szymanski: “…the courts have developed a relatively novel doctrine in public law that a duty of consultation may arise from a legitimate expectation of consultation aroused either by a promise or by an established practice of consultation.” 47. The Court of Appeal in Attorney General & 2 others vs Muthuuri & 4 others (Civil Appeal 352 of 2019) [2021] KECA 41 (KLR) stated thus; “ The concept of “legitimate expectation” was more succinctly propounded in the South African case, South African Veterinary Council vs Szymanski 2003 (4) S.A. 42 (SCA) at https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/13631/eng@2022-10-13 7

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[paragraph 28]: the Court held expressed itself follows:-“The law does not protect every expectation but only those which are 'legitimate'. The requirements for legitimacy of the expectation include the following: (i) The representation underlying the expectation must be 'clear, unambiguous and devoid of relevant qualication': De Smith, Woolf and Jowell (op cit [Judicial Review of Administrative Action 5th ed] at 425 para 8-055). The requirement is a sensible one. It accords with the principle of fairness in public administration, fairness both to the administration and the subject. It protects public ocials against the risk that their unwitting ambiguous statements may create legitimate expectations. It is also not unfair to those who choose to rely on such statements. It is always open to them to seek clarication before they do so, failing which they act at their peril. (ii)The expectation must be reasonable: Administrator, Transvaal v. Traub (supra [1989 (4) SA 731 (A)] at 756I - 757B); De Smith, Woolf and Jowell (supra at 417 para 8-037).ii.The representation must have been induced by the decision- maker: De Smith, Woolf and Jowell (op cit at 422 para 8-050); Attorney- General of Hong Kong v. Ng Yuen Shiu [1983] 2 All ER 346 (PC) at 350h - j.iii.The representation must be one which it was competent and lawful for the decision-maker to make without which the reliance cannot be legitimate: Haupteisch v. Caledon Divisional Council 1963 (4) SA 53 (C) at 59E - G.” 48. The Court went on to summarize the principle of legitimate expectation thus; “ From the foregoing decisions the germane principles that emerge can be succinctly summarized as follows:-(a) there must be an express, clear and unambiguous promise given by a public authority; (b) the expectation itself must be reasonable; (c) the representation must be one which it was competent and lawful for the decision-maker to make; and there cannot be a legitimate expectation against clear provisions of the law or the Constitution.” 49. According to the evidence of PW1 and PW2, they were promised by the Defendant that they will be given rst priority in the intended sale of their houses and that to this end they were issued with letters of expression of interest which they duly completed by lling Form A which they sent to the Defendant. The Plaintis’ basis for this claim is founded on the letter of 25th October, 2003 titled; “ Request for Expression of Interest to purchase scheme properties-Jogoo Road Flats. The Board of Trustees is in the process of considering the possibility of selling House No. ...located at Jogoo Road. The provisional sale price is Kshs. 1, 300,000/= to be paid within Ninety (90) days on receipt of a sale oer and execution of a sale agreement. In addition, the Purchaser is expected to meet the legal fees and relevant statutory charges. Our records show that you currently occupy the above house. In case you currently occupy the house and are interested in purchasing the same and able to do so, please ll FORM A and return to Scheme Oces within one (1) month of the date of this letter. In case you are not able to purchase the house, please ll FORM B and return to Scheme Oces within one (1) month of the date of this letter. It is emphasized that:- a) The above indicated sale price is provisional and the actual price will be conrmed at the time of sale in case the latter place. b) The lling and returning of the attached form to the Scheme is merely an expression of interest and does not constitute a sale contract between the scheme and yourself.” 50. In response, the Plaintis assert that they duly lled Form A indicating their acceptance. A sample of Form A states as follows; “ Possible sale of Jogoo Road Flats-Nairobi Flat number …. https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/13631/eng@2022-10-13 8

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I refer to your letter Ref No……dated……..on the above subject. I hereby conrm currently the above house and interested in buying the same. I further conrm that I am able to pay the total price of the house which is provisionally stated at Kshs ……../= within 90 days on receipt of the sale together with legal fees and any statutory charges. I request the board to consider me in case the house is being sold. 51. The Court has considered the aforesaid letters vis a vis the principles of legitimate expectation discussed above. Clause b of the letter of request states as follows: “ The ling and returning of the attached form to the scheme is merely an expression of interest and does not constitute a sale contract between the scheme and yourself.” 52. The perusal of Form A which the Plaintis purportedly lled and returned to the Defendant does not point to a clear and unambiguous, promise by the Defendant to sale the houses to the Plainti. According to the sample of Form ‘A’, the same was a mere request to the board of trustees to consider the Plaintis in case the houses were being sold. 53. In any event, even if the Court were persuaded to have a dierent opinion of the letters, the said Form A which both PW1 and PW2 assert that they lled in response to the letters of 25th October, 2003 have not been adduced into evidence contrary to the provisions of Section 107 of the Evidence Act. 54. Section 107 of the Evidence Act provides that whoever desires any court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts must prove the existence of those facts. The burden of proving that indeed they lled Form A and submitted it to the Defendant for consideration was upon the Plaintis, a burden that they failed to discharge. 55. As to whether the Plaintis, being former employees of Telkom Kenya and members of the Teleposta Pension Scheme, had a priority over everyone else over the suit properties, the court thinks not. Having considered the documents produced by the Plaintis, including the letters of allocation and the members information booklet, there does not appear to be any undertaking that was given by their former employers and/or the Defendant to accord them the rst priority to purchase the suit properties. In the end, the court is unable to make a nding that the Plaintis were entitled to the suit properties. 56. Having found that there was no undertaking by the Defendant to oer the Plaintis the rst priority in purchasing the suit premises, it follows that the failure to issue them with letters of oer was not discriminatory in light of the admission that they did not sign the tenancy agreements which was a precondition for one to be given the letter of oer to sign. 57. Having failed to prove that they had any priority rights to purchase the suit premises and that the Defendant’s decision not to oer them oer letters was discriminatory and/or unlawful, it follows that the Plaintis are not entitled to any of the orders sought in the Plaint. That being the case, it is the nding of this Court that the Plaintis have not proved their case on a balance of probabilities. 58. For the reasons I have given above, I dismiss the Plaintis’ suit with costs. DATED, SIGNED AND DELIVERED VIRTUALLY IN NAIROBI THIS 13TH DAY OF OCTOBER, 2022. O. A. ANGOTE JUDGE https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/13631/eng@2022-10-13 9

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In the presence of; Ms Beatrice Nduta for the Plaintis Ms Nyabenge & Ms. Mutinda for Defendant Court Assistant: June 9 https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/13631/eng@2022-10-13 10

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