Automated Summary
Key Facts
Ideal Locations Limited sued Nakumatt Holdings Limited and Atul Shah for breach of a 2014 sub-lease agreement, seeking Kshs.27,812,108.52 in unpaid rent/service charges and eviction from the 'City Mall' premises in Mombasa. The court ruled the Environment and Land Court had jurisdiction over the dispute despite ongoing insolvency proceedings against Nakumatt, granting summary judgment for the plaintiff due to the defendant's failure to contest the claims.
Issues
- The court considered whether it had jurisdiction to hear the case involving a landlord-tenant dispute over non-payment of rent for premises, despite pending insolvency proceedings against the tenant. The plaintiff argued that the dispute related to land use and occupation, falling under the Environment and Land Court's jurisdiction, while the defendants contended it should be heard in the High Court under the Insolvency Act.
- The court evaluated the plaintiff's application for summary judgment, as the defendants had not filed a defense or evidence to dispute the claims of unpaid rent and breaches of the lease agreement. The plaintiff demonstrated that the defendants had not raised a bona fide triable issue, leading the court to grant the summary judgment.
Holdings
- The court granted the plaintiff's application for summary judgment as the defendants failed to contest the factual claims of unpaid rent and lease breaches, having only raised jurisdictional objections which were dismissed. The ruling emphasized that unchallenged claims and lack of evidence for a bona fide defense justified the summary judgment.
- The court determined it has jurisdiction under Article 162(2)(b) of the Constitution and Section 13 of the Environment and Land Court Act to handle the landlord/tenant dispute involving non-payment of rent and use of land, despite the pending insolvency proceedings against the defendant. The ruling clarified that the Environment and Land Court can adjudicate such matters without contravening the Insolvency Act.
Remedies
- Kshs.27,812,108.52 being outstanding rent, service charge and promotion fund as at 1st November, 2017.
- Costs of this suit awarded to the Plaintiff.
- An order directed at the Defendants jointly and severally to pay all outstanding rents, service charge, promotion fund and payments accrued to the Plaintiff at the date of vacating the premises.
- A declaration that the 1st Defendant is in breach of the sub-lease Agreement dated 9th June, 2014 between the 1st Defendant and the Plaintiff.
- Summary judgment granted in favor of the Plaintiff for all reliefs pleaded in the amended plaint.
- A declaration that the 2nd Defendant is liable to meet and satisfy the 1st Defendant's debts and liabilities under the sub-lease Agreement dated 9th June, 2014.
- Approval to the Plaintiff to exercise its right of forfeiture and peaceable re-entry into the premises occupied by the 1st Defendant at the City Mall.
- An order directed at the 1st Defendant to immediately vacate the premises at the City Mall and in any event not later than 7 days of this order.
Legal Principles
The Environment and Land Court has jurisdiction to hear disputes relating to the use and occupation of land under Article 162(2)(b) of the Constitution and Section 13 of the Environment and Land Court Act, even when an insolvency proceeding involving a party is pending in another court. The High Court is excluded from jurisdiction in such matters under Article 165(5)(b).
Precedent Name
- Maganlal Motichand Chandaria & 6 Others -v- Paresh Kumar Dodhia
- Continental Butchery Ltd –v- Nthiwa
- Mugunga General Store –v- Pepco Distributors Ltd
- Owners of Motor Vessel 'S'-v- Caltex Oil (K) Ltd
- Samuel Kamau Macharia & Another -v- Kenya Commercial Bank Ltd & 2 Others
- Fredrick Okoth Owino -v- T.S.S. Grain Millers
- Job Kilach -V- Nation Media Group Ltd & 2 Others
- Aden Noor Ali -v- IEBC & 2 Others
- Gupta –v- Continental Builders Ltd
- Daniel Chitwa Chegenye -V- Vihiga Clerk County Assembly and Another
Cited Statute
- Insolvency Act, 2017
- Constitution of Kenya
- Environment and Land Court Act
- Insolvency Act, 2015
- Civil Procedure Rules
Judge Name
C. YANO
Passage Text
- I do find that the Notice of Motion dated 23rd November 2017 is merited and the same is hereby allowed as prayed.
- The dispute herein is about landlord/tenant relationship. It relates to non-payment of rent for the premises that 1st Defendant leased from the Plaintiff. The same clearly relates to use and occupation of land.