Turbo Highway Eldoret Limited & another v Bank of Africa Kenya Limited; Kenol Kobil Ltd (Applicant) (Environment & Land Case 364 of 2015) [2017] KEELC 3868 (KLR) (7 March 2017) (Ruling)

Summary at a glance

Facts

The applicant, Kenol Kobil Ltd, sought a temporary injunction to prevent the defendant, Bank of Africa Kenya Limited, from exercising its statutory power of sale over a leased property. The lease was registered first in time and had a first option of purchase.

Issues

• Whether the lessor needed the lessee's consent before charging the property.
• Priority of registered instruments.

Reasoning

The lease was registered first in time and had a first option of purchase, which is more favorable to the lessee. The court directed the Bank to first offer the property to the lessee before proceeding with the sale.

Outcome

The application was granted, and the Bank was directed to first offer the property to the lessee.

Orders

• The Bank in disposing of the property in exercise of its statutory power of sale, do first offer to the applicant the land parcel Eldoret Municipality/Block 12/131, in the same terms as provided for in clause 6 of the lease.
• In the event that the applicant does not exercise its right of purchase within the time stipulated in Clause 6 of the Lease agreement, then the Bank be at liberty to offer the suit property for sale in the manner stipulated by law in exercise of its statutory power of sale.
• Each party to bear his/her own costs.

Remedies

• Temporary injunction restraining the Bank from harassing, evicting, encroaching into, selling, auctioning, transferring, alienating, or interfering with the quiet possession and enjoyment of the leased property by the applicant.

Authorities cited