Julius John Malaba t/a Abdallah Hardware Store v My Credit Limited (Civil Miscellaneous E196 of 2026) [2026] KEMC 314 (KLR)

9). (Repetition of prayer (8) above). 2. In those grounds, the plaintifi explained that he was ofiered a loan of Kshs. 1,000,000/- by the defendant. The same was secured by motor vehicle registration No. KCF 247L lorry/truck. 3. That he has since repaid over Kshs. 450,000/-. This was through one Roseline Akula Yengo who bought ofi the loan the defendant has proceeded to illegally attach the same without serving any statutory notices upon him prior to the same. 4. That redemption notice was equally not served upon her thereby frustrating his right to redemption of the suit motor vehicle registration No. KCF 247L lorry/truck. That he stands to sufier irreparable loss if orders sought are not granted or sale is allowed to go on by auction and transfer of the said motor vehicle to a 3rd party. 5. In his supporting afidavit, he deposed that upon him experiencing financial challenges, he sold ofi the loan to one Roseline Akula Yengo who continued to service the same. 6. The defendant opposed this application vide a replying afidavit sworn by David Kage, their debt recovery manager on 29/6/2026. The contents of the same were essentially that; i. That a loan of Kshs. 1,000,000/= was indeed ofiered and disbursed to the plaintifi pursuant to the letter of ofier dated 20/1/2025. ii. That the said loan was indeed secured by motor vehicle registration No. KCF 247L pursuant to a movable property securing rights agreement in respect of which the said motor vehicle was registered in their joint names. iii. The term of the loan was 24 months and payable in monthly installments of Kshs. 55,000/=. iv. That the plaintifi has from time to time defaulted on the repayments and even paid below per and so the arrears now stand at kshs. 1,840,797.82. v. In view of persistent defaults, the plaintifi was issued with several reminders but failed/neglected to regularize the accounts prompting issuance by the auctioneer of the proclamation notice dated 26/5/2026 followed thereafter. vi. That the allegations that one Miss Roselyne Akula Yengo bought ofi the loan from the plaintifi and had been repaying it in strange to them because the war was between the parties herein and not her. vii. That it would be unjust to restrain them from selling of the suit motor vehicle yet the plaintifi has been in persistent default. Issues for Determination 7. These relate mainly to principles applicable to grant of temporary injunctions. They are; a. Whether the plaintifi has established a prima facie case. b. Whether the defendant stands to sufier irreparable loss/harm that cannot be adequately compensated by an award of damages if orders sought are not granted. c. Whether the balance of convenience tilts in favour of the plaintifi. https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/314/eng@2026-07-13 2

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d. Whether orders sought should be allowed. Analysis for Determination 8. The court has considered matters raised in this application by the parties and submissions filed. It is trite that grant of a temporary injunction is pegged on three principles that were outlined in the case of Giella -VS- Cassman Brown & Co. Ltd [1978] EA 358. The relevant holding is as follows; “ First, an applicant must show a prima facie case with a probability of success. Secondly, an interlocutory injunction will not normally be granted unless the applicant might otherwise sufier irreparable harm which would not adequately be compensated by an award of damages. Thirdly, if the court is in doubt, it will decide an application on a balance of convenience”. 9. These principles were indeed reafirmed in Nguruman Limited -V- Jan Bondo Nielsen & 2 others [2014] eKLR. 10. The court added that the above principles are legal burden which the applicant must surmount distinctly and sequentially. It held on this as follows; “ 27. These are the three pillars on which rests 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. See Kenya Commercial Finance Co. Ltd V. Afraha Education Society [2001] Vol. 1 EA 86. If the applicant establishes a prima facie case that alone is not suficient basis to grant an interlocutory injunction, the court must further be satisfied that the injury the respondent will sufier, in the event the injunction is not granted, will be irreparable. In other words, if damages recoverable in law is 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. The existence of a prima facie case does not permit “leap-frogging” by the applicant to injunction directly without crossing the other hurdles in between. 11. Concerning the test of prima facie case, the case of Mrao Ltd -V- First American Bank of Kenya Ltd & 2 others [2013] eKLR as well as Nguruma Limited (supra) state that it means a more than arguable case. This requires the applicant not to merely raise issues but to show also that his right has been infringed upon as to call for an explanation from the opposing party. 12. Concerning proof of irreparable injury, loss or damage, it was held in the case of Barclays Bank -VSKenneth Kiruani Wanjohi & 2 others [2020] eKLR that; “ An injury is irreparable where there is no standard by which the amount of compensation can be measured with reasonable accuracy or where damages cannot be a suficient or adequate remedy”. 13. Lastly, the test regarding the requirement that the applicant has to establish that the balance of convenient tilts in favor of the is also crucial. https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/314/eng@2026-07-13 3

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14. The court in the case of American Cyanamid Co. -VS- Ethicon Ltd [1975] (396) held that the balance of convenience weighing the risk of injustice to both parties of an injunction is denied. 15. Parties held difierent views on whether these principles were met by the plaintifi in this application. This was both in their averments in this application itself and the submissions they filed. 16. But the starting point is that the loan is not disputed and neither was the nature of security which was ofiered by the plaintifi for the same. 17. It is a common ground that the suit motor vehicle was used on security for the loan pursuant to a movable property security right agreement that was executed between parties. 18. In terms of the issue of prima facie case, the plaintifi submitted that he had demonstrated by evidence that he entered into an agreement by which he sold ofi the loan to one Roseline Akula Yengo who then allegedly continued repaying the same. 19. By that agreement, she agreed to purchase the suit motor vehicle and undertook to service the loan. It was further submitted that the said agreement was witnessed by the defendant’s branch manager, one Purity Shitakwa. On that ground, the Plaintifi argued that the defendant cannot be seen to approbate and reprobate at the same time. 20. But on the contrary, the defendant submitted that the loan was between them and the defendant meaning that the said person is a stranger to them. They were emphatic that if the plaintifi had alternative arrangements on the repayments, they are not privy to the same. 21. Annexed to the plaintifi’s supporting afidavit were on Mpesa statements for payments made by the said person to the defendant. 22. However, the defendant whilst acknowledging these statements, submitted that the same had nothing to do with this case. 23. In the court’s view, the payments made by the said 3rd party cannot be overlooked. Although the defendant maintains that no privity exists or arises between them and the said 3rd party, a look at the sale agreement annexed shows that indeed their employee by the name of Purity Shitakwa signed the it in her capacity as their Branch Manager, Kitale branch. 24. Therefore, they were aware of the arrangement between the said 3rd party and the plaintifi over the repayments which the latter made on the loan account and even endorsed the same. 25. That means, that all the payments which she made on the plaintifi’s loan account with the defendant pursuant to the agreement are prima facie valid. The same ought to have been factored into the into the repayments on that particular account. 26. Hence, the plaintifi has not only demonstrated a prima facie case against the defendant but also gone ahead to show that there is need for rendering of accounts by the defendant with regard to all the monies repaid thereon. 27. Failure on their part to acknowledge those payments and discount them appropriately is an infringement of the plaintifi’s right to fairness as far as relates to the administration of his loan account. Without factoring in those payments, it would be dificult to give a true account of what is in actual arrears. 28. In terms of irreparable loss or damage, the court’s view is that whereas the defendant is right to maintain that they are in a position to compensate the plaintifi in any event (if the suit were to eventually succeed) https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/314/eng@2026-07-13 4

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as the value of the suit motor vehicle is known, that can only be the case where they have acted with fairness by considering all the repayments made but which is not the case. 29. Secondly, the Defendant has alleged that they issued the plaintifi with several reminders about his default on the loan repayments. However, court has upon perusal of the Defendant’s annextures noted that none exist on record. That means that they are yet to demonstrate that they issued any statutory notice or Notification of the default to the Plaintifi independent or difierent from that which was served upon him by the Auctioneer before repossession. The one issued by the Auctioneer pursuant to Rule 15 of the Auctioneers Rules is also mandatory but it only comes into play when the former has been complied with. The latter serves to enable the loanee or mortgagor/ chargor to know the date of the sale so he can exercise his right of redemption prior or during the sale. The same should have been served upon him by the Defendant first prior to commencement of the repossession process. This is a statutory requirement under section 67 of Movable Property Security Rights Act and Its absence this far puts the entire repossession process in jeopardy. 30. Lastly, the court is to consider the balance of convenience and see if the same tilts in favour of the plaintifi or not. 31. As already seen from the case law cited, the issue is to be determined by weighing the risk of injustice to both parties, if an injunction is not granted. 32. Given my finding on the other two tests above, it follows that the plaintifi has duly surmounted this test too. It is prima facie clear that the risk of injustice weighs heavily against the plaintifi as opposed to the defendant if the court were to decline to grant the injunction. 33. In the circumstances, I would find merit in this application and allow prayers (3), (4), (5) and 6 thereof as prayed. 34. However, I find no merit in prayer (7) because the court cannot rewrite a contract for parties – Wanyama -V- Malava Financial Services Association ( Employment & Labour Relations Appeal E008 of 2023) [2024] KEELRC 1014 (KLR) (Judgement). 35. On costs, the same shall be in the cause because actual proof of the matters herein will depend on merits of the upon trial. RULING DELIVERED IN OPEN COURT THIS 13TH DAY OF JULY, 2026 R.B.N MALOBA SPM In the presence of; Mr. Moshe for Mr. Mutunga for defendant. No appearance for MS. Kiplai for plaintifi. https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/314/eng@2026-07-13 5

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