Techno Holdings Limited & 4 others v National Social Security Fund Board of Trustees [2018] KECA 378 (KLR)
The bottom line
#The Court of Appeal refused to stop NSSF from seizing goods for over Kshs.46 million in unpaid rent, because the tenants hadn't even paid what they admitted they owed.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the intended appeal is arguable
- 2.Whether the intended appeal would be rendered nugatory if the injunction is not granted
Key legal issues
#Test for grant of an injunction pending appeal under Rule 5(2)(b)
The applicant must demonstrate an arguable appeal and that the appeal will be rendered nugatory if the orders are not granted; both limbs must be satisfied.
The court restated the settled Rule 5(2)(b) principles from Reliance Bank vs Norlake Investments, as reinforced in Peter Paul Mburu Ndururi vs James Macharia Njore. Both conditions are conjunctive. Since the applicants admitted that the 1st applicant had not paid even the rent it admitted was owing, the landlord was entitled to levy distress, and the intended appeal could not be said to be arguable. Having failed the first limb, the court did not consider the second.
Entitlement to levy distress for unpaid rent
A landlord is entitled to levy distress to recover outstanding rent where the tenant has not paid even the amount admitted as owing.
It was common ground that the 1st applicant had made no payments towards rent, which stood at Kshs.46,980,000 inclusive of VAT as at June 2018. Counsel for the applicants admitted non-payment. The court held that the respondent, as landlord, was within its rights to levy distress for the outstanding rent, which defeated the claim that the distress was irregular or illegal.
Legal principles established
#- An applicant under Rule 5(2)(b) must satisfy both the arguability and the nugatory-ness principles; satisfying only one is insufficient.
Court orders
#- 1.The application under Rule 5(2)(b) is dismissed with costs
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- Environment and Land Court at Mombasa
- E.L.C No. 377 of 2017
- Jurisdiction invoked
- Rule 5(2)(b) of the Court of Appeal Rules
Relief refused
#Injunction restraining the respondent from levying distress or interfering with the applicants' possession of L.R No. Mombasa/Block XX/328/329 pending the intended appeal
The applicants failed to demonstrate an arguable appeal, having not even paid the rent they admitted was owing; both Rule 5(2)(b) principles must be established
Costs
The application is dismissed with costs to the respondent.
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
The applicants are obliged to satisfy both of those principles; it is not enough to satisfy only one of them.
Having failed to satisfy the first principle, we find that there is no need to delve into the second principle since both principles have to be established for an order under Rule 5(2)(b) to issue.
The upshot of the foregoing is that this application lacks merit and is hereby dismissed with costs.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Techno Holdings Limited & 4 others v National Social Security Fund Board of Trustees [2018] KECA 378 (KLR)", Case Analysis (2018). Civil Application No. 49 of 2018. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2018/378/eng@2018-07-12
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.