Wanjala & another v Branch Microfinance Ltd (Formerly Century Microfinance Bank Ltd) (Civil Suit E503 of 2025) [2026] KEMC 733 (KLR)

4. That this Honourable Court be pleased to issue a temporary order of injunction restraining the Defendant/Respondent from selling and/or disposing by way of public auction the Plaintiffs/Applicants’ land parcels East Bukusu/South Kanduyi/13695 and East Bukusu/South Kanduyi/1232 pending the hearing and determination of the main suit 5. That the Honourable Court be pleased to order the Defendant/Respondent to supply the Plaintiffs/Applicants with their loan account statements 6. That costs of this application be provided for by the Defendant/Respondent 3. The instant Application was grounded on the grounds set out on its face and further grounds set out in the Supporting Affidavits sworn by the Applicants on 11th November 2024. 4. The 1st Applicant admitted receiving a building and construction loan of Kshs. 1,000,000/= in 2022 from Century Microfinance Bank Limited while the 2nd Applicant admitted receiving a loan of Kshs. 800,000/= in 2021 from Century Microfinance Bank Limited, using land parcel numbers East Bukusu/South Kanduyi/13695 and East Bukusu/South Kanduyi/1232 (jointly referred to as ‘the suit properties’) as security loan. 5. The Applicants averred that they fell into arrears in servicing the said loans advanced to them in August 2022 when they realized that Century Microfinance Bank Limited (‘Century’) had been changed to Branch Microfinance Bank Limited (‘Branch’), and thus feared losing their money and the suit properties.

page 2 of 14

6. They further averred that they visited Century offices in Bungoma only to find the offices closed. This prompted them to visit the Century offices in Nairobi, only to be told that Century had been acquired by Branch. 7. It was their case that they demanded the merger and acquisition documents as well as their loan statements from the Defendant/Respondent, but the same were not supplied to them. 8. They added that they resumed repaying the loans thereafter, and that at the time of filing this suit, the 1st Applicant had repaid Kshs. 795,350/= leaving a balance of Kshs. 1,148,650/= while the 2nd Applicant had reportedly paid Kshs. 865,058/= leaving a balance of Kshs. 324,942/=. 9. They further averred that if the orders sought are not granted, they were at risk of losing their fully developed plots, which their families depended on. 10.They termed the Kshs: 1,145.642.46/= and Kshs. 1,020,822.11/=, which the Respondent was demanding from the 1st and 2nd Applicant, respectively, as unrealistic and unjustifiable. 11.The Respondent opposed the instant Application through a Replying Affidavit sworn by Stephen Karanja; the Respondent’s debt recovery associate, on 04th December 2025. 12.Mr. Karanja urged this court to dismiss the instant Application with costs for being frivolous, vexatious, and an abuse of the court process. 13.He further averred that Century advanced loan facilities to the 1 st Applicant on diverse dates between 10th August 2021 and 15th June 2022, with the 1st Applicant using land parcel number East Bukusu/South Kanduyi/13695 as security. He added that Century advanced to the 2 nd Applicant a loan facility of Kshs. 800,000/= on 08th August 2021 with the 2nd Applicant’s land parcel number East Bukusu/South Kanduyi/1232 being used as security.

page 3 of 14

14.The Respondent denied closing their Bungoma offices. They took the position that and that they informed the Applicants about the acquisition of Century by Branch through a Central Bank of Kenya notice issued on 08 th February 2022, which acquisition was effected by a special resolution on 08th June 2022 (see annexure J). 15.The Respondent added that at the time of filing this suit, the 1 st Applicant owed the Respondent Kshs. 1,284,104.80/= having repaid Kshs. 129,847.66/= while the 2nd Applicant owed the Respondent Kshs. 595,704.60/= having repaid Kshs. 500,398.99/=. 16.The Respondent further averred that they had only served upon the Applicants the 90 days’ statutory notice, and had not commenced the auctioning the suit property, hence the Applicants were hell-bent on frustrating the Respondent’s efforts to recover their money. Parties Written Submissions 17.On 04th December 2025, this court gave directions on the filing of written submissions by the parties herein. Whereas the Respondent filed their written submissions, the Applicants did not. 18.The Respondent submitted at length on the three limbs/conditions set out in the Giella vs. Cassman Brown & Co. Ltd [1973] EA case, which a party must satisfy before a temporary injunction is issued in their favour. 19.It was the Respondent’s case that the Applicants had not established a prima facie case with a probability of success, since they had not led any evidence on any illegality, mischief, or void of the contract; therefore, the Applicants must be called upon to honour the terms of their loan agreements. 20.On whether the Applicants would suffer irreparable loss if the orders sought are not granted, the Respondent submitted that the instant Application was

page 4 of 14

premature, given that the Respondent had only issued the 90-day statutory notice. They added that the Applicants cannot lay claim to the charged property, given that their default in servicing the loans advanced to them allowed the Respondent to exercise their statutory power of sale. 21.The Respondent averred that any injury occasioned to the Applicants if the orders sought by the Applicants are not granted could be compensated by way of damages since the value of the suit property could be computed for the purposes of awarding damages. 22.Further, the Respondent relied on Kitur & Another Vs. Standard Chartered Bank & 2 Others (2002) KEHC 1181 (KLR) for the position that the Respondent, being a financial institution, was capable of paying damages to the Applicants if the injunctive orders sought are not granted, and the Applicants ultimately succeed in pursuing this case. 23.On balance of inconvenience, the Respondent submitted that the Respondent was going to be greatly inconvenienced compared to the Applicants if the injunctive orders sought are granted, given that the loans would continue to accrue interest and that the said orders would unreasonably or unjustifiably deny them the right to recover the loans advanced to the Applicants. ANALYSIS & DETERMINATION 24.This court has duly considered the parties’ pleadings, submissions, annexures, and authorities relied upon by each party. The only issue for determination is whether the instant Application is merited. Whether the Application and the Orders sought are merited 25.Before determining whether this Application and the Orders sought are merited, this court warns itself of the dangers of making definitive findings

page 5 of 14

of fact or law at this interlocutory stage as eloquently stated in Lucy Nungari Ngigi & 4 Others -vs- National Bank of Kenya Limited & Anor (eKLR), where it was stated: “....I am also aware that the 1 st Defendant has raised issues in respect of the mortgage herein, their right to exercise the statutory power of sale, breach of the addendum, default of repayment of the loan etc. They have also raised some accountability issues from the 2nd Defendant on the purchase price. But even these queries should be reserved for and determined at the trial. These issues are in direct conflict with issues raised by the Plaintiffs and the 2 nd Defendant. At this stage I should not make any comments or findings, or express opinions on the substantive issues in controversy in order to avoid hurting the trial herein...” (Emphasis added) 26.Similarly, in Mrao Ltd v First American Bank of Kenya Ltd & 2 Others [2003] KLR 125, the Court of Appeal stated that: “…..It is true that the Court is not required at that stage to decide finally whether the evidence is worthy of credit, or whether if believed it is weighty enough to prove the case conclusively: that final determination can only properly be made when the case for the defence has been heard…” 27.The Applicants seek injunctive orders. The principles guiding the grant of an interlocutory injunction in this jurisdiction were set out in East African Industries vs. Trufoods [1972] EA 420 and Giella vs. Cassman Brown & Co. Ltd [1973] EA 358. Those principles were restated in Nguruman

page 6 of 14

Limited vs. Jan Bonde Nielsen & 2 Others [2014] eKLR , where the court rendered itself thus: “In an interlocutory injunction application, the applicant has to satisfy the triple requirements to; (a) establish his case only at a prima facie level, (b) demonstrate irreparable injury if a temporary injunction is not granted, and (c) ally any doubts as to (b) by showing that the balance of convenience is in his favour. 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 sufficient basis to grant an interlocutory injunction, the court must further be satisfied that the injury the respondent will suffer, 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-

page 7 of 14

frogging” by the applicant to injunction directly without crossing the other hurdles in between. It is where there is doubt as to the adequacy of the respective remedies in damages available to either party or both that the question of balance of convenience would arise. The inconvenience to the applicant if interlocutory injunction is refused would be balanced and compared with that of the respondent, if it is granted.” 28.This court will now proceed to determine whether the Applicant has satisfied the principles for the grant of injunctive orders. 29.On whether the Applicants have established a prima facie case, the Respondent took the position that the Applicants, having failed to lead any evidence on any illegality, mischief, or void of the contract, had not established a prima facie case for the granting of a restraining injunction against them. 30.The Applicants took the view that they were not served with the merger and acquisitions documents and notice of the merger or the acquisition of Century by Branch. They also took issue with the Respondent’s computation of the money they had repaid and the outstanding loan amount. They described the money claimed by the Respondent as unrealistic and unjustifiable claims of money 31.In the Mrao Ltd Case (supra) the Court of Appeal defined a prima facie case as follows: ‘…It may not be easy to define what is meant by “prima facie case”, but at least it must mean one on which a reasonable tribunal, properly directing its mind to the law and the evidence could convict if no explanation is offered by the defence...The terms “prima facie” case,

page 8 of 14

and “genuine and arguable” case do not necessarily mean the same thing, for in using another term, namely a sustainable cause of action, the words “prima facie” are frequently used to refer to a case which shifts the evidential burden of proof, rather than as giving rise to a legal burden of proof in the manner of considering, which was in relation to the pleadings that had been put forward in the case…In civil cases a prima facie case is a case in which on the material presented to the Court a tribunal properly directing itself will conclude that there exists a right which has apparently been infringed by the opposite party to call for an explanation or rebuttal from the latter. A prima facie case is more than an arguable case. It is not sufficient to raise issues but the evidence must show an infringement of a right, and the probability of success of the applicant’s case upon trial. That is clearly a standard, which is higher than an arguable case.’ 32.The question that abounds at this stage is whether the Applicants have demonstrated at that there exists a right which has been apparently infringed by the Respondent to call for an explanation from the latter. 33.It is evident that the parties herein took a different position on the loan amount repaid by the Applicants and outstanding as at the time of filing this suit. The Applicants also alleged that they failed to dutifully service the loans advanced to them on the ground that they were not given sufficient notice by the Respondent on the acquisition of Century by Branch. 34.This court takes the view that by the Applicant’s raising the two issues above, the evidential burden shifted to the Respondent to prove on a balance of probabilities whether the notice issued by the Central Bank of Kenya on

page 9 of 14

Century’s acquisition by Branch was sufficient, and whether the computation of the loan amount repaid and outstanding was proper. 35.The parties herein invited this court to resolve the two issues above based on the conflicting Affidavit evidence on record. This court is of the considered view that the issues above can only be resolved with finality after either party has cross-examined the other party’s evidence during a full trial. 36.Considering the issues above and the finding by this court that those issues cannot be settled at this interlocutory stage, it follows that the Applicants have established a prima facie case that can only be dislodged or proved with finality after a full trial. 37.As regards proof of irreparable injury, the Applicants averred that if the orders sought are not granted, the Respondent will proceed to exercise their statutory power of sale, thereby causing them to lose the suit property. 38.It was the Respondent’s position on this issue that the Applicants were not going to suffer irreparable loss since the Respondent had only served the 90day statutory notice. The Respondent also stated that the Applicants had defaulted in servicing the loans advanced to them, thus they cannot purport to lay claim to the suit property. 39.The Respondent submitted that they would suffer irreparable loss since the loan will remain unpaid and continue to accrue interest. They added that in any event, if the injunctive orders are not granted, any damage occasioned to the Applicants could be compensated by way of damages. 40.Halsbury’s Laws of England, 3rd Edition Volume 21, Paragraph 739 page 352 defines irreparable injury as; ‘injury which is substantial and could never be adequately remedied or atoned for by damages, not injury which cannot possibly be

page 10 of 14

repaired and the fact that the plaintiff may have a right to recover damages is no objection to the exercise of the jurisdiction by grant of 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 injury in respect of which relief is sought is likely to destroy the subject matter in question.’(Emphasis added) 41.It is given that if the injunctive orders sought herein are not granted, the Respondent will proceed to conclude issuance of relevant notices to the Applicants, leading to the exercise of their statutory power of sale over the suit property. 42.Therefore, if the Respondent is not stopped in their tracks at this stage, the Applicants will lose the suit property. If it ultimately turns out after hearing of the main suit that the Respondent was wrong in commencing the process of exercising their statutory power of sale over the suit property, it will be an academic exercise for this court to issue an injunctive order at that stage to save the suit property from sale, since by that time the suit property may have changed ownership. The net effect of this will inevitably be this court’s sanctioning of the infringement of the Applicants’ right to property protected under Article 40 of the Constitution. 43.Be that as it may, it is not lost to this court that even if the Applicants lose the suit property at this stage, their loss can be computed through the valuation of the lost land. The valuation can inform the award of damages to the Applicants if they ultimately succeed in proving the main suit on a balance of probabilities.

page 11 of 14

44.This court is also well aware of pronouncements in various High Court decisions including the Kitur case, relied upon by the Respondent to the effect that where damage to be suffered by a party can be compensated by way of damages, the court should not grant an injunctive order. 45.Whereas that argument may sound attractive, this court associates itself with the holding in Joseph Siro Mosioma vs. Housing Finance Company of Kenya Limited & 3 Others [2008] eKLR, where it was stated as follows by Warsame J (as he was then): “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 financial 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.” (Emphasis added) 46.The passage from Halsbury’s Laws of England, 3rd Edition Volume 21, reproduced above, also warns against a court failing to grant injunctive orders on the basis that damages can adequately compensate for the loss suffered by a party denied an injunctive order. 47.Each land is unique in its own way. When one loses their land, damages awarded to compensate them for the loss of that land may never be adequate to compensate such a party for land similar to the lost land. 48.The foregoing shows that the mere fact that one can be awarded damages for denial of an injunction does not deny an Applicant the necessary protection by way of an interim injunction.

page 12 of 14

49.In any event, it will lead to absurd consequences if this court holds that a financial entity is at liberty to trample on people’s rights just because it is a financial behemoth capable of paying any damages that they may be ordered to pay to a party that was denied an injunctive order. 50.In the circumstances, this court holds and finds that if the main suit is ultimately determined in favour of the Applicants, failing to preserve the suit property at this stage may cause irreparable damage to the Applicants. 51.Turning to the ingredient of balance of convenience, this court has already made findings that the Applicants have established to the required standards the first two limbs for the grant of an injunctive order. Therefore, it inevitably follows that the balance of convenience tilts in their favour. 52.To this end, this court draws inspiration from Paul Gitonga Wanjau vs. Gathuthis Tea Factor Company Ltd & 2 Others [2016] eKLR, where the Court expressed itself thus on this issue:"…If applicant has a strong case on the merits or there is significant irreparable harm, it may influence the balance in favour of granting an injunction. The court will seek to maintain the status quo in determining where the balance on convenience lies.”(Emphasis added) DETERMINATION 53.For the reasons above, the following orders commend to this court:a) The Defendant/Respondent is restrained from selling and/or disposing by way of public auction the Plaintiffs/Applicants’ land parcels East Bukusu/South Kanduyi/13695 and East Bukusu/South Kanduyi/1232 pending the hearing and determination of this suit

page 13 of 14

b) The Defendant/Respondent is ordered to supply the Plaintiffs/Applicants with their loan account statements forthwith c) The Plaintiffs/Applicants are restrained from dealing with land parcels East Bukusu/South Kanduyi/13695 and East Bukusu/South Kanduyi/1232 in any manner inimical to the Defendant/Respondent’s statutory power of sale d) For expeditious disposal of this matter, the parties herein are ordered to comply with Order 11 of the Civil Procedure Rules within 30 days from the date hereof e) To avoid abuse of the injunctive order herein issued in favour of the Plaintiffs/Applicants, this court will not entertain any adjournments during the hearing of this matter f) Costs of this Application shall abide the outcome of the main suit Read, signed, and delivered in open Court at Bungoma this 29 th day of January 2026 T.O. OMONO SENIOR RESIDENT MAGISTRATE In the presence of: Mr. Khaemba for the Defendant/Respondent C/A: Mr. Rioba

page 14 of 14