Terer v Jepchirchir

e. That this Honourable Court be pleased to grant any other or further orders it may deem t and expedient in best interest of justice. f. That the Respondent be condemned to pay the cost of this Application. 2. The application is based on the grounds on its face and supported by the Plainti’s Adavit sworn on 25th June, 2024. According to the Plainti, he was the legal owner of the parcels known as Eldoret Municipality Block 12/621 & 622 (the suit properties) and has always been in possession thereof. By an Agreement dated 9th July, 2022 he sold the suit properties to the Respondent for KShs.27,500,000/-. She paid KShs.17,500,000/- leaving a balance of KShs.10,000,000/- to be paid on or before the completion date, which was within 90 days from the date of the Agreement. He deponed that they subsequently agreed that he transfers the property to the Respondent to enable her acquire a loan to clear the balance of the purchase price before the completion date. The Respondent however failed to acquire the loan and has also failed to clear the balance to date. 3. The Plainti deponed that on 12th December, 2022 he issued a completion notice, but the Respondent did not comply with it. He then issued a rescission notice dated 10th January, 2023 pursuant to the Agreement. The Respondent has however neglected or refused to comply with the demands set out in the rescission notice. Instead, the Respondent has attempted to gain entry into the suit property, in an attempt to dispossess him of the property the rescission notwithstanding. Further, that the Plainti avers that he has information that the Respondent has illegally oered the suit properties for sale and is also fraudulently attempting to charge the property even after the rescission has crystallised. He deponed that any action taken by the Respondent over the suit properties after crystallisation of the rescission is invalid, null and void. The Plainti is apprehensive that the Respondent will proceed to dispose of the land, occasioning him irreparable loss and damage. He prayed that the court grant all the orders stated in the Application. 4. In response to the application, the Defendant led a Replying Adavit dated 17th July, 2024 where she denied the Plainti’s allegation and asserted that he had not met the threshold for grant of the orders sought and therefore Application ought to be dismissed. She deponed that she has paid the amounts agreed under the contract but the Plainti has refused to undertake a reconciliation of the accounts. That she has complied with the condition of payment of the contractor, which payment is part of the instalment amounts. It is her case that the Application is meant to hoodwink the court into granting the orders despite completion of developments, yet the Defendant is in occupation. The Plainti, she said, had not demonstrated what prejudice he would suer if she occupied the land and developments. She deponed that under the Law Society Conditions of Sale, 2015 one cannot rescind an agreement when the other party has paid over 70% of the amount. She asked for a dismissal of the Application with costs. 5. The Plainti responded vide his Supplementary Adavit sworn on 8th August, 2024. He denied the Defendant’s claims, pointing out that the Cheques allegedly drawn in the name of Terer Kibii & Company Advocates were deposited by one Mathew K. Kemboi, a stranger to these proceedings, without notice to him or his Advocates. He deponed that there is nothing to link the said deposits to the transaction which subject matter of this suit. Further, that the amounts allegedly deposited did not cover the full balance of the purchase price. He added that they were done after breach of the sale and also after issuance of the completion and rescission notices. He also deponed that vacant possession was to be given after full payment of the purchase price. The Defendant therefore had colluded with his contractor to carry out un-authorised, invasive, illegal construction work that was prejudicial to his interests without rst complying with terms of the sale agreement. https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/14197/eng@2024-10-16 2

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6. He deponed that the sale agreement did not provide for payment to the contractor as part of the terms of the purchase price and he is thus stranger to any arrangement between the Defendant and 3rd parties. It is his contention the Defendant’s said actions are therefore in bad faith and she should not be allowed to benet from them. He further deponed that he has established that despite the notices issued herein on 31st January, 2023, the Defendant used one of the plots being Title No. Eldoret Municipality Block 12/622 as security to obtain a loan from one Luke Kipkemoi Chemweno, and instead of using the funds to clear the balance she has continued with the developments on the suit property. He reiterated that he will suer irreparable loss and damage as he already transferred the properties to the Defendant who has failed to pay the balance. He deponed that he has a strong case with high chances of success hence the need to allow the instant application as prayed. Applicant’s Submissions 7. The Application was canvassed by way of written submissions. In the Plainti’s submissions dated 15th August, 2024 Counsel cited Order 40(1) (a) & (b) as the law on temporary injunctions. Counsel submitted that the guiding principles on temporary injunctions are set out in the case of Giella vs Cassman Brown (1973) EA 358 and reiterated in Nguruman Limited vs Jan Bonde Nielsen & 2 Others CA No. 77 of 2012 (2014) eKLR these principles are that the Applicant must demonstrate that he has a prima facie case. Secondly, that he will suer irreparable injury if the order is not granted. Lastly, if the court is in doubt it shall determine the application on a balance of convenience. 8. On prima facie case, it was submitted that the Plainti had through the evidence on record established a strong case against the Defendant with high chances of success. He relied on the case of Mrao Ltd vs First American Bank of Kenya Limited & 2 Others (2003) eKLR. 9. Among other cases, Counsel cited Abu Chiaba Mohammed vs Mohammed Bwana Bakari & 2 Others (2005) eKLR for the contention that a party ought not be allowed to benet from their own breach of contract. 10. Counsel submitted that the Plainti stands to suer irreparably if the orders are not granted. It was his contention that being the case, the balance of convenience tilts in favour of the Plainti. It was also submitted that under Section 68(1) of the Land Registration Act, the court may issue an order of inhibition. Going by the Defendant’s actions regarding the suit property, Counsel urged that the order of inhibition is necessary to maintain the status quo until the suit is heard and determined. Counsel submitted that under Section 27 of the Civil Procedure Act, costs are discretionary and are awarded to the successful party. He asked that the Applicant be awarded costs of this Application. He relied on Party of Independent Candidate of Kenya & Another vs Mutula Kilonzo & 2 Others (2013) eKLR. Respondent’s Submissions 11. On her part, the Respondent led her submissions dated 8th August, 2024 contending that an injunction is a discretionary remedy, which discretion is to be exercised judiciously. It was urged that the Plainti had not satised the principles for grant of a temporary injunction as set out in Giella vs Cassman Brown (Supra) et al. That the Plainti had not established a prima facie case because the Respondent legally purchased the property, has already paid the agreed amount and is in actual possession. That the Plainti had not demonstrated the irreparable harm he will suer if the application is not allowed. 12. It was Counsel’s submissions that the land having already been sold at KShs.17,500,000/-, has a known value and the Applicant can be compensated by way of damages. Counsel relied on Mrao vs First American Bank (Supra), Pius Kipchirchir Kogo vs Frank Kimeli Tenai (2018) eKLR. https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/14197/eng@2024-10-16 3

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Counsel submitted that the suit land is the Defendant’s matrimonial home which her children and grandchildren have known as home. She argued that having developed the land, she is the one who stands to suer irreparable loss if the prayers are granted. Counsel pointed out that the Plainti’s title was in question, and that the Respondent has in fact been in possession of the suit property since before 9th July, 2022 when she purchased the same. Counsel added that the Plainti wanted to unjustly enrich himself by keeping the money paid and keeping the land, therefore he had come to court with unclean hands. 13. Counsel asserted that the Plainti had failed to prove that the balance of convenience tilts in his favour, instead it tilts in the Defendant’s favour as she is in possession. He added that allowing the application would amount to evicting her from the suit properties and her properties would be destroyed and put in a position where they would not be restored to the state they are in. Reliance was placed on Paul Gitonga Wanjau vs Gathuthis Tea Factory Compant Ltd & 2 Others (2016) eKLR and Amir Suleiman vs Amboseli Resort Limited (2004) eKLR. On costs, Counsel submitted that the Application lacks merit and should be dismissed with costs to the Respondent (Robert Mugo Wa Karanja vs Eco Bank (Kenya ) Limited & Another (2019) eKLR). Analysis and Determination 14. I have carefully considered the Motion herein, the two adavit led in support thereof and the Replying Adavit together with the accompanying annexures. I have also considered and weighed the rival submissions in this application. The issues for determination are: i. Whether the Plainti has met the requirements for the grant of an order of temporary injunction pending the hearing and determination of this suit; ii. Whether the court should issue an order of inhibition over the titles to the suit property; and iii. Who shall bear the costs of the application? i. Whether the Plainti has met the requirements for the grant of an order of temporary injunction pending the hearing and determination of this suit; 15. The principles guiding the grant of interlocutory injunction are now well settled. Those principles have been set out in numerous cases. One such case is that of Nguruman Limited vs Jan Bonde Nielsen & 2 others (2014) eKLR where the Court of Appeal held that: “ …these are the three pillars on which rest the foundation of any order of injunction, interlocutory or permanent. It is established that all the above three conditions and stages are to be applied as separate, distinct and logical hurdles which the applicant is expected to surmount sequentially… if the applicant establishes a prima facie case that alone is not sucient basis to grant an interlocutory injunction, the court must further be satised that the injury the respondent will suer, in the event the injunction is not granted will be irreparable. In other words, if damages recoverable in law are an adequate remedy and the respondent is capable of paying, no interlocutory order of injunction should normally be granted, however strong the applicant’s claim may appear at that stage. If prima facie case is not established, then irreparable injury and balance of convenience need no consideration.” https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/14197/eng@2024-10-16 4

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16. To answer the question what constitutes a prima facie case, the Court of Appeal in the above case held that: “ The party on whom the burden of proving a prima facie case lies must show a clear and unmistakable right to be protected which is directly threatened by an act sought to be restrained, the invasion of the right has to be material and substantive and there must be an urgent necessity to prevent the irreparable damage that may result from the invasion. We reiterate that in considering whether or not a prima facie case has been established, the court does not hold a mini trial and must not examine the merits of the case closely. All that the court is to see is that on the face of it the person applying for an injunction has a right which has been or is threatened with violation. Positions of the parties are not to be proved in such a manner as to give a nal decision in discharging a prima facie case. The applicant need not establish title it is enough if he can show that he has a fair and bona de question to raise as to the existence of the right which he alleges. The standard of proof of that prima facie case is on a balance or, as otherwise put, on a preponderance of probabilities. This means no more than that the Court takes the view that on the face of it the applicant’s case is more likely than not to ultimately succeed.” 17. It is the Plainti’s case that the Defendant purchased the suit property but has failed to complete the payment of the balance of the purchase price despite the land having now been transferred to her. The Defendant denied this allegation, deposing that she has in fact performed her part of the contract and paid the purchase price in full. As proof of the alleged payment, she annexed cheques and a letter from a contractor alleging to acknowledge receipt of a certain amount. The Defendant alleged that it was a term of the contract that the said payment to the contractor would form part of the purchase price. 18. The cheques annexed by the Respondent were drawn in the name of Terer Kibii & Company who started acting for the Plainti after the breach. Under the Agreement however, the balance of the purchase price was to be made to the Plainti’s Advocates in the transaction, that is Kipkoror Cheruiyot & Kigen Advocates. Notably also, the cheques are both dated 26th May, 2023 yet the Plainti has indicated that the Completion Notice was issued on 12th December, 2022 and the Rescission Notice was dated 10th January, 2023. This contention the Defendant has not even bothered to deny, thus at this, stage and without any evidence to the contrary, I am compelled to believe it. The eectiveness of such payments which were made after crystallisation of the rescission notice is in doubt. 19. Moreover, the documents annexed by the Defendant indicate that the amounts were deposited by one Mathew K. Kemboi, yet no link has been established between the Defendant and the said individual who as the Plainti indicated is a stranger to the transaction. I have perused the Agreement for Sale and note that there is nothing directing the Defendant to make any payments to a contractor. And if the contractor was building a residence for the Defendant, I fail to understand how payments to that contractor could be counted towards the balance of the purchase price to the Plainti who was the Vendor. At this interlocutory stage, I am convinced that from the above summary obtained from the evidence submitted in this Application, the Plainti has indeed established a prima facie case. 20. The second factor that the Plainti must establish is that he stands to suer irreparable injury which cannot be adequately remedied by damages in the absence of an injunction. The Halsbury’s Laws of England 3rd Edition, Volume 21, paragraph 739, page 352 explains what irreparable injury is in the following words:“ By the term irreparable injury is meant injury which is substantial and could never be adequately remedied or atoned for by damages, not injury which cannot possibly be repaired https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/14197/eng@2024-10-16 5

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and the fact that the plainti may have a right to recover damages is no objection to the exercise of the jurisdiction by injunction, if his rights cannot be adequately protected or vindicated by damages. Even where the injury is capable of compensation in damages an injunction may be granted, if the act in respect of which relief is sought is likely to destroy the subject matter in question. In order to show irreparable harm, the moving party must demonstrate that it is a harm that cannot be quantied in monetary terms or which cannot be cured. But what exactly is "irreparable harm"? Robert Sharpe, in ‘Injunctions and Specic Performance,’ [Robert Sharpe, Injunctions and Specic Performance, looseleaf, (Aura, On: Cananda Law Book, 1992), P 2-27] states that ‘irreparable harm has not been given a denition of universal application: its meaning takes shape in the context of each particular case’.” 21. The Plainti deponed that he stands to suer because he has already transferred the land to the Defendant yet she has refused and/or neglected to pay the balance. The Defendant denied the Plainti’s allegations of irreparable injury. It is her case that the land has a known value since it was valued at KShs.17,500,000/- at the point of sale, that it has a known value and the alleged irreparable injury can be compensated by way of damages. It must be noted that the said price was xed in the year 2022 when the land was being sold, the value has since appreciated and the Plainti may need to obtain the services of a valuer to ascertain the current market price. Therefore, this argument may have been plausible if the Defendant could have shown even at this interlocutory stage that she had indeed paid the sum as agreed in 2022, however her failure to prove compliance with the contract renders her argument untenable. 22. Since it appears that the rescission notice was served and had crystallised, a fact the Defendant has not denied or rebutted, the Plainti stands to be dispossessed of the property before the matter is heard and determined, which to my mind, is a loss that cannot be compensated by way of damages. On this, the court nds guidance in the case of Joseph Siro Mosioma vs Housing Finance Company of Kenya Limited & 3 Others (2008) eKLR, where it was held that:“ …damages is not automatic remedy when deciding whether to grant an injunction or not. Damages is not and cannot be substituted for the loss which is occasioned by a clear breach of the law, in any case, the nancial strength of a party is not always a factor to refuse an injunction. More so a party cannot be condemned to take damages in lieu of his crystalized right which can be protected by an order of injunction.” 23. I nd it unbelievable that the Respondent who purchased the property in the second half of the year 2022 can now claim that the suit properties are the place that her children and grandchildren have known as home. To be clear, no evidence has been exhibited of the said matrimonial home or that the Defendant is in possession of the suit property as alleged. In any event, this court was informed that the developments that she is referring to as her matrimonial home were undertaken illegally. Thus her allegation that there is a residence thereon that constitutes her matrimonial home is an admission that she undertook developments on the property before completion of the purchase price. It follows therefore that the Plainti has also satised the limb of irreparable harm and that the Defendant may continue to act in a manner detrimental to the interests of the Plainti. 24. The law is that if the court is in doubt over the rst two tests, the it has to be satised that the balance of convenience tilts in favour of granting the injunction. Since the court is not in doubt over the rst two tests discussed above, it goes without saying that the balance of convenience automatically tilts in favour of granting the temporary injunctive orders sought. https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/14197/eng@2024-10-16 6

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ii. Whether the court should issue an order of inhibition over the titles to the suit property; 25. The Plainti also prayed for an order of inhibition pending hearing and determination of the Application or until further orders of this court. For this reason, this court is at liberty to consider the said prayer at this stage and make any further orders relating thereto pending hearing and determination of this suit. Like an interlocutory injunction, an order of inhibition preserves the property in dispute pending its hearing and determination. The legal basis for issuance of an order of inhibition is to be found at Section 68(1) of the Land Registration Act which provides that:“ The Court may make an order (hereinafter referred to as an inhibition) inhibiting for a particular time, or until the occurrence of a particular event, generally until a further order, the registration of any land lease or charge.” 26. This provision gives the court discretion to inhibit registered dealings on land for a particular time or until the occurrence of a particular event, which in this case would be the hearing and determination of the suit. See the case of M’murithi & another vs Kigia (Environment & Land Case E014 of 2022) [2023] KEELC 17760 (KLR), where the Court explained that:“ 17. The order of inhibition is provided for under Section 68 (1) of the Land Registration Act. This section gives the court discretion to inhibit registered dealings on land for a particular time or until the occurrence of a particular event. As such, an inhibition order is an order which is in the nature of a prohibitory injunction restraining dealings on land pending further orders of the court. The purpose of the said order is to preserve the property in question from acts that would otherwise render a court order incapable of being executed and or to give an opportunity to hear and decide the matter. In an application for orders of inhibition, in my understanding, the applicant has to satisfy the following conditions; that the suit property is at the risk of being disposed of or alienated or transferred to the detriment of the applicant unless preservatory orders of inhibition are issued, that the refusal to grant orders of inhibition would render the applicant’s suit nugatory, and that the applicant has an arguable case.” 27. But before a Court issues an order of inhibition, it must satisfy itself that the applicant has good grounds to warrant the issuance of such an order, that the property is at risk of being disposed and that he has an arguable case which will be rendered nugatory by refusal to grant the order. In the instant case, the court has already determined that the Applicant has demonstrated that he has a prima facie case. 28. As to the impending risk of disposal of the property if the order is not issued, the Plainti has explained that he already transferred the suit property before the balance of the purchase price was paid, and now the Respondent has defaulted. Despite the default and the fact that the completion as well as rescission notices were served and have since crystallised, the Defendant went ahead to obtain a loan using one of the properties as security. From the “Addendum of Friendly Loan Agreement” of 30th January, 2023 annexed to the Plainti’s Supplementary Adavit, it appears that the Defendant has so far obtained KShs.9,250,000/-. This document was clearly done after the Plainti had issued the notice to rescind the Sale Agreement. 29. It is also apparent from the said document that the initial amount advanced was on 17th December, 2022 after the Completion Notice had been issued and received. The Addendum document clearly states that should the Defendant default in repaying the amounts advanced, she would transfer the https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/14197/eng@2024-10-16 7

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parcel known as Eldoret Municipality Block 12/622, to the Luke Kipkemoi Chemweno who advanced the loan. It is clear therefore that the Plainti indeed stands to lose the suit properties to a total stranger if the orders are not granted. Also going by the said actions of charging the property to a third party prior to completing payment of the balance of the purchase price, it becomes clear that the Plainti’s apprehension that the Defendant may proceed to charge or otherwise dispose of the suit property is not unfounded. This satises the twin requirements of risk of disposal of the property, which will render the suit nugatory. 30. The Plainti has therefore established good grounds why the order of inhibition should be issued. I nd that it is in the interest of justice to preserve the subject matter of this suit pending hearing and determination hereof. Having taken into account all relevant factors and the circumstances of this case, this court will exercise its discretion and grant an order of inhibition to be registered against suit properties restricting/restraining any dealings whatsoever on their registers pending the hearing and determination of this suit. iii. Who shall bear the costs of the application? 31. Section 27 of the Civil Procedure Act grants the Court the discretion to award costs. Under the proviso thereto, costs usually follow the event, unless special circumstances present themselves why such costs should not be awarded. In the instant Application, the Court nds that the Plainti/Applicant has succeeded. This court sees no justiable reason why the successful party should be denied the costs of this Application. For that reason, the Defendant herein shall be condemned to bear the costs of this Application. 32. Consequently, the Plainti’s Application dated 25th June, 2024 succeeds. The court allows the said application in the following terms:a. Pending hearing and determination of this suit, an order of temporary injunction be and is hereby issued restraining the Defendant/Respondent either by herself, her servants and/or agents from disposing o, charging, transferring or trespassing upon, gaining entry, taking possession or in any other way interfering with Land Title Nos. Eldoret Municipality Block 12/621 & 622. b. Pending hearing and determination of this suit an order of inhibition be and is hereby issued to be registered against suit properties restricting/restraining any dealings whatsoever on the registers of Land Title Nos. Eldoret Municipality Block 12/621 & 622. c. The Defendant/Respondent shall pay the costs of this Application. DATED, SIGNED AND DELIVERED AT ELDORET THIS 16TH DAY OF OCTOBER 2024 ………………… J.M ONYANGO JUDGE In the presence of; 1. Mr. Matekwa for Mr. Mwinamo for the Plainti/Applicant 2. No appearance for the Defendant/Respondent Court Assistant: Brian https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/14197/eng@2024-10-16 8

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