Automated Summary
Key Facts
The case involves a dispute between tenants Edwin Thagana Wahome and Florence Njambi (Applicants) and landlord Denis Mbugua (1st Defendant) over the termination of a sublease agreement for Booth 7 at Kimathi House. The sublease, signed on 26 March 2018, was initially set to expire on 1 March 2023 but the landlord issued a termination notice on 20 December 2022. The tenants paid Kshs. 105,000 in rent for March-May 2023 as ordered by the Tribunal. The landlord claimed arrears of Kshs. 159,000, but the Tribunal found no valid notice of rent increase and ruled the tenants were not in arrears. The Tribunal ordered the landlord to provide new lease terms within 14 days and allowed the tenants to remain in the premises while paying Kshs. 45,000 monthly rent from October 2023 pending resolution.
Issues
- Whether the Court should grant the orders sought by the Tenant, including an injunction against eviction and renewal of the sublease agreement, considering the Landlord's failure to respond to the renewal request and the creation of a periodic tenancy through continued rent acceptance.
- Whether the tenant was in rent arrears, including the dispute over the rent increase from Kshs. 35,000 to Kshs. 45,000 and the Landlord's failure to provide a notice of the alleged increase as stipulated in section 4 of the Act.
- Whether this Honourable Tribunal has jurisdiction to determine this Reference, considering the Landlord-Tenancy Relationship and the provisions of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, Cap 301 Laws of Kenya.
Holdings
- The Tribunal partially allowed the Tenant's application, ordering the Tenant to pay rent at KShs. 45,000 from October 2023 pending lease renewal negotiations. The Landlord was directed to provide new lease terms within 14 days, and the reference was set for hearing on 30th October 2023.
- The Tribunal found that it has jurisdiction to determine the matter as the continued acceptance of rent by the Landlord after the lease expiry created a controlled periodic tenancy of month-to-month, which falls under the purview of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act.
- The Tribunal determined that the Tenant was not in rent arrears as the Landlord failed to provide proper notice of the rent increase from KShs. 35,000 to KShs. 45,000, as required by Section 4 of the Act. The rent for March to May 2023 was confirmed at KShs. 35,000 per month.
Remedies
- The landlord shall provide new terms of the lease in 14 days. The tenant shall respond in 14 days as well.
- The reference shall be fixed for hearing of the new terms of the lease on 30th October 2023.
- Tenant shall remain in the premises and keep paying rent at the rate of Kshs. 45,000.00 from the month of October 2023 on or before the 5th of every month pending the hearing and determination of the reference on the new term of the lease.
Legal Principles
- The ruling applied the notice period requirements under Section 4 of the Act, confirming that a 2-month notice was validly served but superseded by the landlord's subsequent acceptance of rent, creating a month-to-month periodic tenancy.
- The court determined jurisdiction based on the definition of a controlled tenancy under the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act, Cap 301, emphasizing that a landlord-tenancy relationship qualifies for tribunal jurisdiction even after lease expiration if rent is accepted.
Precedent Name
- Owners of the Motor Vessel 'Lillian S' Vs Caltex Oil (Kenya) Limited
- Samuel Kamau Macharia & another v Kenya Commercial Bank Limited & 2 others
- Nancy Njeri Gitau & another v James Muchone Njuga & another
Cited Statute
- Landlord and Tenant (Shops, Hotels and Catering Establishments) Act
- Land Act, 2012
Judge Name
Andrew Muma
Passage Text
- 45. From the foregoing, we find that the rent payable for the period of March to May 2023 was KShs.35,000 being the rent payable before the alleged increment. 46. In the premise therefore, I find that the Tenant had no rent arrears.
- From the foregoing, it is my finding that a Landlord-Tenancy Relationship exists between the Tenants/Applicants and the 2nd Defendant/Landlord and the said relationship qualifies as a controlled relationship despite the expiry of the lease agreement. This relationship also falls within the purview of Section 2 of the Act which defines controlled tenancy as one which has not been reduced into writing.
- b. The Tenant shall remain in the premises and keep paying rent at the rate of Kshs. 45,000.00 from the month of October 2023 on or before the 5th of every month pending the hearing and determination of the reference on the new term of the lease. c. The landlord shall provide new terms of the lease in 14 days. The tenant shall respond in 14 days as well.