Seborga Leisure Limited v The Board of Trustees National Social Security Fund (Civil Suit 117 of 2015) [2022] KEHC 16426 (KLR) (Civ) (8 December 2022) (Judgment)
Neutral citation:
[2022] KEHC 16426 (KLR)
Republic of Kenya
Civil Suit 117 of 2015
CW Meoli, J
December 8, 2022
Between
Seborga Leisure Limited
Plaintiff
and
The Board of Trustees National Social Security Fund
Defendant
Judgment
1.Seborga Leisure Limited, (hereafter the plaintiff) sued The Board of Trustees National Social Security Fund (hereafter the defendant) seeking various reliefs. The reliefs include a declaration that the defendant’s action of forcefully, abruptly and without notice or service of any court order, evicting the plaintiff from ‘part b’ of its rented premises on March 21, 2014 was illegal; an order and declaration that the forceful and abrupt eviction of the plaintiff from ‘part a’ of its rented premises without any due process was illegal and malicious; a declaration that the plaintiff is entitled to restitution and compensation for the loss and damages occasioned by the defendants’ illegal actions; compensation to the plaintiff in the total sum of Kshs 25,400,000/- for losses and damage incurred as a result of the illegal eviction; general damages for breach of contract in respect of ‘part a’ tenancy; and damages on account of defamation and public embarrassment resulting from the illegal eviction.
2.It was averred that the at all material times to the suit the defendant was the owner of all the premises known as Hazina Plaza (hereafter the suit premises) located in Mombasa’s Central Business District and erected on LR No Mombasa Block XX/328 and 329. That the plaintiff had leased from the defendant two different sections of the suit premises known as part a whose lease was to expire on September 30, 2013 but continued after its expiry, and part b whose lease was to run until September 2009 which also continued after its expiry; that the two adjoining sections were on the ground floor of the suit premises in which two different sets of businesses were operated by the plaintiff.
3.It was further averred that on March 21, 2014 the defendant’s representatives without warning or prior notice descended upon and broke into the plaintiff’s leased business premises being part a & part b and threw on to the street all movable items, fixtures, and consumables before locking up the premises. That the said illegal and malicious action led to the immediate and total collapse of the hitherto thriving bar and restaurant business in part b as well as the Casino, Bar and Restaurant Business in part a. The plaintiff further avowed that the defendant’s actions exposed it to ridicule and embarrassment in the eyes of their clientele, other businesses and general public, in addition to occasioning loss of the plaintiff’s investment in excess of Kshs 50,000,000/-.
4.On April 14, 2015 the defendant filed a statement of defence denying the key averments in the plaint and liability. The defendant averred that notice to terminate tenancy was issued to the plaintiff and that the local authorities having declared the entire building unfit for continued occupation, a court order was obtained directing the plaintiff to vacate the suit premises and therefore the plaintiff’s claim against the defendant was unfounded.
5.During the trial, Lucy Muraguri testified on behalf plaintiff as PW1. She identified herself as one of the directors of the plaintiff and working primarily in the plaintiff’s bar and restaurant business in ‘part b’ of the premises. It was her evidence that the defendant on March 23, 2014 evicted the plaintiff without notice despite the subsisting lease agreement and that prior to the eviction, the defendant had on occasion visited the said premises and sent letters claiming that the lease had expired. That part a lease was current at the time and at the expiry of the lease in respect of part b, the plaintiff had continued to operate the bar and restaurant under a controlled tenancy. It was her further evidence that the eviction notice served was in respect of part b.
6.The witness adopted her witness statement dated March 20, 2015 as part of her evidence in chief, the gist thereof repeating almost verbatim the averments in the plaint. PW1 produced the plaintiff’s bundle of documents as PExh1A (letter dated July 9, 2008 from counsel, notice dated June 30, 2010 from defendant, letter dated July 15, 2010 & October 11, 2011 from counsel) and PExh1B (photos of suit premises). She asserted that prior to the eviction on March 14, 2014, no order was issued for eviction in respect of part a of the leased premises.
7.Under cross-examination, she confirmed that the lease for part a of the suit premises was to run until September 2013 and had expired by the date of eviction. It was her evidence further that the plaintiff was earning about 2,000,000/- per month but admitted that she had not tendered any statements of accounts, bank records, receipts or KRA remittances in proof of the foregoing. Ditto for the plaintiff’s further claim for Kshs 24,500,000. She asserted that the Public Health Department of Mombasa did not serve the plaintiff with the statutory notice to the effect that the building had been declared as unfit for habitation. She confirmed being present when the eviction was carried out.
8.She confirmed that as indicated in the letter dated November 1, 2012 from the Business Premises Rent Tribunal (BPRT) the plaintiff did not file any reference in the BPRT in opposition to the defendant’s notice to terminate the tenancy in respect of part b. She reiterated that the defendant’s actions defamed the plaintiff admitting however that at the time of eviction, one of the leases had expired while the other was subsisting. In re-examination she reiterated that the eviction occurred on March 21, 2014 and that the eviction order was in respect of part b of the lease and that she had not seen an order of eviction in respect of part a. She further reiterated her defamation claims and non-service of the statutory notice declaring the premises unfit for habitation.
9.John Wasike testified on behalf of the defendant as DW1. He identified himself as an employee of the defendant for over 15 years and previously based at the defendant’s Property Development Department at Mombasa. He proceeded to adopt his witness statement dated April 13, 2015 as his evidence in chief. The gist of his evidence was that on March 21, 2014 he accompanied the court bailiff and the police to execute a warrant of eviction in respect of the suit premises. He denied that goons were deployed in the eviction exercise. He asserted that on arrival at the premises, the court bailiff recorded the names of the plaintiff’s witnesses to the eviction as had been ordered in Mombasa ELC No 29 of 2013 which was a suit filed by the defendant against the plaintiff. It was his evidence that part a & b leases were for premises in Hazina Towers and that the entire building was condemned as unfit for human occupation by the National Environment Management Authority (NEMA) in conjunction with the County Government of Mombasa. He stated that the eviction was lawful and that none of the plaintiff’s goods were destroyed as the eviction was conducted under the supervision of the court bailiff. He asserted that the statutory notice by the local government concerning the building was served upon the plaintiff through its counsel in Mombasa ELC No 29 of 2013.
10.The witness proceeded to produce the bundle of documents attached to the defendant’s list of documents dated April 13, 2015 as DExh1 (notice from Public Health Department), DExh2 (notice terminating tenancy), DExh3 (letter to BPRT dated October 23, 2012), DExh4 (letter from BPRT dated November 1, 2012), DExh5 (plaint in Mombasa ELC No 29 of 2013), DExh6 (motion dated January 21, 2013 in Mombasa ELC No 29 of 2013), DExh7 ( defence in Mombasa ELC No 29 of 2013), DExh8 (ruling in Mombasa ELC No 29 of 2013), DExh9 (order in Mombasa ELC No 29 of 2013 dated February 28, 2014), DExh10 (notice of appeal dated March 12, 2014), DExh11 (motion dated April 3, 2014 in Mombasa ELC No 29 of 2013) and DExh12 (ruling on motion dated April 3, 2014 in Mombasa ELC No 29 of 2013) and documents in the supplementary list of documents dated March 30, 2021 as DExh.13A (warrants dated March 19, 2014 in Mombasa ELC No 29 of 2013) and DExh13B (order issued on March 17, 2014 in Mombasa ELC No 29 of 2013).
11.Under cross-examination DW1 asserted that the eviction of the plaintiff resulted from the notice condemning the suit premises that was issued by the Mombasa Public Health Department. He further confirmed that there was at the time no existing lease in respect of part a while admitting that the letter from the BPRT (DExh4) and the plaint in the ELC suit (DExh5) related to part b and not part a of the demised premises. That although DExh5 was not amended to include part a, the eviction could not be affected on part b alone as the eviction order referred to the plaintiff who was in occupation of both part a & b of the suit premises. He stated that although the eviction order (DExh13B) was not amended prior to the eviction, the plaintiff was evicted from the entire premises it occupied.
12.Upon being shown the photographs of the suit property (PExh1B) he explained that a tenant who subsequently attempted to occupy the suit premises had since been evicted and that the premises remained vacant. That the approval of the board of directors to renovate the building had not issued hence the suit premises were yet to be renovated and are currently not fit for occupation.
13.During re-examination he reiterated that the suit premises are vacant and unsuitable for occupation and that the eviction warrant was in respect of both premises in occupation by the plaintiff; that the entire building had been condemned and piecemeal eviction was not possible. He further reiterated that both leases had expired at the time of eviction and that the business known as Baig Motors reflected in the photographs PExh1B had unlawfully occupied the premises after it was sealed off for renovation but were subsequently evicted from the said premises. He concluded by stating that the eviction was lawful and supervised by the court bailiff. He therefore urged the court to dismiss the plaintiff’s suit.
14.The parties filed written submissions pursuant to directions issued at the close of the trial. Counsel for the plaintiff opened his submissions by contending that the defendant had confirmed during hearing that the tenancies herein had converted into controlled tenancies and hence a court order was necessary to terminate the leases and to pave way for the eviction of the plaintiff tenant. Counsel further submitted that the defendant did not obtain a court order for eviction in respect of part a not having amended the pleadings to include the part a tenancy in the suit before the Mombasa Environment and Land Court. Hence the eviction of the plaintiff from part a tenancy was an act of impunity and misuse of the court process by the landlord which the court ought not to countenance.
15.Counsel asserted that as a consequence of the defendant’s actions the plaintiff’s business reputation was tarnished and the business irredeemably ruined.
16.Concerning general damages for breach of the tenancy in respect of part a of the suit premises the plaintiff cited the decisions in Munaver N. Alibhai t/a Diani Gallery v South Coast Holdings Limited [2020] eKLR, Francis Githuku Kabue v Kimani Chege & another [2009] eKLR and Mureu v Karuga [2004] eKLR to urge an award of Kshs 5,000,000/-. It was further submitted that the plaintiff was also entitled to aggravated and exemplary damages for defamation and public embarrassment. He urged an award of Kshs 5,000,000/- in that regard, relying on decisions in Monica Hardware Limited v Diamond Trust bank [2021] eKLR and Pius Kinyua t/a Salambo Proprietary Club v Nation Media Group Limited [2019] eKLR. In conclusion the court was urged to allow the suit as prayed.
17.The defendant failed to file submissions despite being given ample opportunity to do so.
18.The court has considered the pleadings, evidence as well as the submissions filed by the respective parties. In Wareham t/a A.F Wareham & 2 others Kenya Post Office Savings Bank [2004] 2 KLR 91, the Court of Appeal stated in this regard that: -
19.The plaintiff’s claim is founded on alleged breach of the tenancy agreement and unlawful eviction. At the hearing, PW1 adopted her witness statement whose key assertions were that:-
20.It is trite that the onus was on the plaintiff to prove the allegations of breach of the lease agreement, hence unlawful eviction, and resultant loss as a result of breach of the lease agreement and defamation as pleaded in the plaint. The applicable law as to the burden of proof is found in section 107, 108 and 109 of the Evidence Act which provides that:-
21.In Karugi & another v Kabiya & 3 others [1987] KLR 347 the Court of Appeal stated that:
22.It is not disputed that prior to the eviction, a tenancy lease in part a and part b was executed between the parties in respect of two premises in Hazina Plaza, Mombasa. It was further not in dispute that the lease expired on September 30, 2013 and 30.08.2009, respectively. None of the parties herein produced the lease document as exhibit before the court. PW1 also averred that two separate businesses were operated by or for the plaintiff’s gain in the suit property; premises under part a being a casino bar and restaurant and premises under part b being a bar and restaurant. It was the plaintiff’s contention that the eviction in respect of both part a and b was without notice, illegal and malicious. and that it occasioned grave losses to the plaintiff.
23.The thrust of the defendant’s case was that pursuant to notice issued under the Public Health Act and Local Government by-laws (hereafter the statutory notice) to the defendants, the entire suit premises, namely, Hazina Towers was effectively condemned and declared unfit for human occupation. And that upon receipt of the said notice the defendant wrote to the plaintiff indicating the intention to terminate the lease in respect of part b, to facilitate renovation in compliance with the statutory notice. That the renovation could not be carried out while the plaintiff and other tenants were in occupation.
24.The plaintiff objected to the notice as evidenced by the DExh4, prompting the defendant to move the Environment and Land Court (ELC) vide a suit (DExh5) seeking to evict the plaintiff from part b of the demised premises. in that cause the statutory notices and notice of termination of lease were cited in the plaint and annexed to the supporting affidavit to the motion dated January 21, 2013, resulting in the orders for eviction of the plaintiff.
25.Evidently, the lease in respect of part b had expired in 2009 but the plaintiff had remained in occupation. The plaintiff participated in the proceedings in the ELC cause by filing a statement of defence (DExh7) and contested the motion referred to above. In the ruling delivered by Mukunya J (as he then was), in respect of the defendant’s motion, the court entered judgment against the plaintiff, paving way for the eviction of the plaintiff from part b of the suit premises.
26.Consequently, the plaintiff’s eviction from part b of the suit premises was done pursuant to a court order and the allegation by the plaintiff that it was illegal as no notice was served cannot stand. Moreover, the plaintiff’s claim of breach of the part b lease by the defendant cannot arise; the plaintiff’s lease in respect of part b became a controlled tenancy upon expiry of the lease agreement in 2009. Regarding the execution of the eviction order, beyond oral assertions by PW1 no evidence was tendered before the court by the plaintiff to demonstrate that it was unlawful and/or that any goods were damaged in the exercise. For his part, DW1 has testified that the exercise was carried out under the supervision of the court bailiff and in the presence of police.
27.Moving on to the part a lease, the court must consider whether there was breach of the lease agreement entitling the plaintiff to damages for the loss and defamation pleaded. The Court of Appeal in Palace Investment Ltd v Geoffrey Kariuki Mwenda & Another [2015] eKLR, in discussing the burden and degree of proof in civil cases stated that:
28.There can be no dispute that the suit in the ELC and culminating order of eviction related to part b and not part a of the suit premises. Although the entire building known as Hazina Plaza was affected by the statutory notice, the plaintiff who remained in occupation under a controlled tenancy at the expiry of the part a lease was nevertheless entitled to the requisite notice under the law. It is therefore not a good answer for the defendants to assert as they have done that the eviction order by the court also related to part a because the order was addressed against the plaintiff and that the whole building stood condemned pursuant to the statutory notice.
29.Section 2 of the Landlord and Tenant (Shops Hotels and Catering Establishment) Act describes as controlled tenancy as:-
30.Consequently, notwithstanding the statutory notice and ELC proceedings in respect of the suit premises and in particular part b thereof, the defendant was obligated to comply with the provisions of the Landlord and Tenant (Shops Hotels and Catering Establishment) Act in evicting the plaintiff from part a.
31.Section 4 (1), (2), (5) & (6) of the above Act provides that: -(1)Notwithstanding the provisions of any other written law or anything contained in the terms and conditions of a controlled tenancy, no such tenancy shall terminate or be terminated, and no term or condition in, or right or service enjoyed by the tenant of, any such tenancy shall be altered, otherwise than in accordance with the following provisions of this Act.(2)A landlord who wishes to terminate a controlled tenancy, or to alter, to the detriment of the tenant, any term or condition in, or right or service enjoyed by the tenant under, such a tenancy, shall give notice in that behalf to the tenant in the prescribed form.(3)…………….(4)……………(5)A tenancy notice shall not be effective for any of the purposes of this Act unless it specifies the grounds upon which the requesting party seeks the termination, alteration or reassessment concerned and requires the receiving party to notify the requesting party in writing, within one month after the date of receipt of the notice, whether or not he agrees to comply with the notice.(6)A tenancy notice may be given to the receiving party by delivering it to him personally, or to an adult member of his family, or to any other servant residing within or employed in the premises concerned, or to his employer, or by sending it by prepaid registered post to his last known address, and any such notice shall be deemed to have been given on the date on which it was so delivered, or on the date of the postal receipt given by a person receiving the letter from the postal authorities, as the case may be.”
32.The Court of Appeal in South C Fruit Shop Limited V Housing Finance Company of Kenya Limited [2013] eKLR stated that:-
33.The defendant failed to comply with the legal requirement for notice, and or an eviction order in respect of part a but nevertheless proceeded to evict the plaintiff from part a after eviction in respect of part b. The Court of Appeal addressing a similar situation in Gusii Mwalimu Investment Co Ltd v Muahimu Hotel Kisii Ltd, [1996] eKLR observed that: -
34.The plaintiff’s eviction from part a of the suit premises was therefore illegal and unlawful and the plaintiff is entitled to damages. However, prayer (e) of the plaint sought general damages for breach of contract. While it is doubtful that general damages are available for breach of contract, the tenancy agreement herein had admittedly expired in 2013 way before the date of the eviction.
35.Special damages sought in prayer (d) of the plaint were in the sum of Kshs 25,400,000/- in respect of losses and damage resulting from the illegal eviction as pleaded in paragraph 17 of the plaint. The Court of Appeal in Nkuene Dairy Farmers Co-op Society Ltd & another v Ngacha Ndeiya [2010] eKLR said concerning special damages stated that:-
36.The plaintiff herein did not tender any evidence in support of its pleaded special damages amounting to Kshs 25,400,000/-. This court concurs with Madan, J (as he then was) in CMC Aviation Ltd v Cruisair Ltd (No 1) [1978] KLR 103; [1976-80] 1 KLR 835, where he observed regarding pleadings that :-
37.The plaintiff was illegally evicted from part a. although no proof of the actual losses pleaded in paragraph 17 of the plaint was tendered, it seems plausible that the eviction and closure of the business resulted in some form of loss or at least disruption of the business. In my view given the facts surrounding the eviction, prior notice by the defendants concerning part a would really have been a formality as the plaintiffs were already aware from the proceedings in the ELC cause that the entire building had been condemned as unfit for occupation. That said, the illegal action of the defendant should not be allowed to go without some sort of remedy. Having looked at the authorities cited by the plaintiff, the court finds none that is on all fours with the instant matter, but some guidance can be gleaned therefrom. Considering all the foregoing, the court is persuaded to award a nominal damages in the sum of Kshs 150,000/- (one hundred and fifty thousand) under prayer (d) of the plaint, to the plaintiff.
38.Regarding the claim based on defamation, it is difficult to tell whether this was related to the entire eviction process or part thereof. Part of the eviction carried out in respect of part b was lawful. Unlike the norm in defamation claims, the claim herein was not based on published words, and the onus was on the plaintiff to show how the actions of the defendants amounted to defamation. No evidence was led on that score, or witness called to demonstrate that the eviction lowered the estimation of the plaintiff in the eyes of right-thinking members of society. Words or actions that cause embarrassment to the subject may not necessarily amount to defamation of the person. A claim for defamation cannot succeed without such evidence and the plaintiff’s claim for damages for defamation must therefore fail.
39.In SMW v ZWM (2015) eKLR, the Court of Appeal observed:
40.The plaintiff’s suit has only succeeded in part, and judgment is entered for the plaintiff against the defendant for nominal damages under prayer (d) of the plaint, in the sum of Kshs 150,000/- (one hundred and fifty thousand). The plaintiff is awarded half the costs of the suit and interest from the date of this judgment.
DELIVERED AND SIGNED ELECTRONICALLY AT NAIROBI ON THIS 8TH DAY OF DECEMBER 2022.C.MEOLIJUDGEIn the presence of:Ms. Adhiambo for the PlaintiffMr. Awino for the DefendantC/A: Adika