The application dated 30/9/2024 has been filed by Bank of Africa, the proposed interested party. It seeks the following orders:
a. That the applicant be joined as an interested party;
b. That it be granted leave to file pleadings or responses;
c. That the interim orders issued be reviewed to permit the registration of the surrender of the freehold title, closure of the freehold register, registration of lease in favour of the 1st defendant, opening of a leasehold register, and registration, subject to the interests of the plaintiff, of a charge in the leasehold register once opened.
The grounds relied on for the application are that the applicant financed construction of housing units on the suit land; the 1st defendant charged the suit land to the applicant vide a charge dated 19/9/2012; the plaintiffs having sued for failure to transfer units to them after purchase, the applicant is directly affected by the orders that may issue as it has a financial interest in the suit property, and they need secure it on the leasehold title once it issues. These grounds are further elaborated in the supporting affidavit of Felix Muhato annexed to the motion. The additional facts that come to fore in the affidavit are that there have been several cases –ELC 355/16, ELC 207/15, HCCC NO 2/18 all relating to the suit land, and in at least two of the cases the buyers, who are just like the present plaintiffs, who have paid in full were granted orders in their favour against the 1st defendant. In ELC 355/16 the 1st defendant has already been ordered in a final judgment to surrender the freehold title and execute a legal discharge in favour of the applicant. It has also emerged that there is an inhibition order issued on 13/11/2025 which has been noted in the register for the suit land.
The plaintiffs opposed the motion vide their grounds of opposition dated 11/11/2024. Those grounds state that the applicant does not meet the threshold for joinder; the application is an abuse of process; that no revelation is made of when the applicant got to know of this suit hence the application is a ploy to delay the determination of the present suit; that there is no privity of contract between the applicant and the plaintiffs with regard to the purchase of their housing units; that the applicant’s issue is commercial in nature and this court lacks jurisdiction and the proper forum for the application is the high court; that pleadings in the mentioned suits have not been exhibited and it is not possible to determine the relation of the matters therein to those in the present suit; that no prior leave for joinder has been sought; that the applicant has its own suit and in any event has failed to demonstrate that it has a stake or legal interest in the suit land.
In opposition to the present motion, the 1st defendant filed a replying affidavit of one Osman Erdinc Elsek, a director of the 1st defendant dated 23/10/2024. It is deponed therein that as the issue concerns the registration of a charge over the suit property which is not within the purview of use of land as envisaged in Section 13 of the ELC Act, this court lacks jurisdiction over the application; that the proper forum for the application is the High Court; that from case law an interested party is only a person whose presence is crucial for the effectual and complete adjudication of all the questions involved in the suit; that from the rules of this court there is no definition of an interested party; that in any event and drawing from the rule 7 of the Constitution Of Kenya (Protection Of Rights And Fundamental Freedoms) Practice And Procedure Rules 2013 seeking of prior leave of court to be joined as an interested party is necessary yet no leave has been sought in the present application and so a vital procedural step has been skipped which is not a mere procedural technicality, and which omission is fatal to the motion; that at the present moment the applicant is not a party and hence the substantive Prayers Nos 2 And 3 of the application can not be delved into or granted; further, that the applicant has not demonstrated that it would be prejudiced as it has admitted that it has its own suit against the 1st defendant in which it has already obtained a judgment in its favour.
SUBMISSIONS.
The applicant and the 1st defendant filed their submissions. I have taken consideration of the filed submissions in the preparation of this ruling. Both submissions follow and elaborate on the main points raised in the supporting and opposing documents in respect of the present application as set out herein above.
Applicant’s Submissions
The applicant’s submissions are to the effect that there is an agreement between it and the 1st respondent under which the latter voluntarily undertook to surrender the freehold title and complete the title conversion process and that this commitment is central to the ongoing proceedings and compliance with that agreement is central to resolving the dispute; that the predominant issue is conversion of title without which the plaintiffs cannot obtain sub-leases; that reliance on Mutunga Rules is misplaced as the only apply to petitions; that failure to seek leave is not fatal since order 1 rule 10 CPR does not demand prior obtainance of leave before joinder application is made. The other contents of the submissions relate mostly to what happened between the parties and has been addressed in the analysis of the supporting affidavits herein above.
1st Defendant’s Submissions
The 1st defendant emphasized that this court lacks jurisdiction and cited Owners of Motor Vessel Lillian S Vs Caltex Oil Kenya Ltd 1989 eklr and Co-Operative Bank Ltd Vs Patrick Njuguna Kangethe2017 KECA. It also focused on the defects in the application and cited Order 1 Rule 10(2) of the Civil Procedure Rules and Marigat Group Ranch & 3 others vs Chepkoimet & 19 others 2014 eklr for the proposal that the applicant seeks to have the interim orders overturned hence it wants to agitate over its rights in respect of the subject matter suit, against the caution given by the court in the Marigat Case (supra) that it is necessary for a court to ensure that no person cloaked as an interested party enters the arena of litigation and agitates rights of his own in respect of the subject matter of the suit. It is submitted that contrary to Order 45 and the holding in Otieno Ragot & Co Advocates V National Bank of Kenya Ltd 2020 eklr the applicant had knowledge of all the matters in its supporting affidavit and the proposed review should hence not be allowed. It was further submitted that since there is no procedure for joining an interested party in the CPR the holding of the court in Florence Nafula Ayodi & Others V Jonathan Ayodi Ligure & Others should apply and Section 7(1) of the Mutunga Rules should then be used. It is urged that that provision provided that leave had to be sought before the application for joinder was made.
DETERMINATION
The issues for determination in the application before me are as follows:
a. Is failure to seek leave prior to the application for joinder fatal?
b. Does this court have jurisdiction to hear and determine the application?
c. Are the orders sought merited?
The argument of the 1st defendant and of the plaintiff in respect of the first issue have been set out above. It is the correct position that the Civil Procedure Rules do not include a procedure for joinder of an interested party. Were the applicant seeking joinder as a substantive party, say, defendant the matter would have been relatively easier, for Order 1 Rule 10(2) of the Civil Procedure Rules states as follows: -
“The court may at any stage of the proceedings, either upon, or without the application of either party, and on such terms as may appear to the court to be just, order that the name of any party improperly joined, whether as Plaintiff or Defendant be struck out, and that the name of any person who ought to have been joined, whether as Plaintiff or Defendant or whose presence before the court may be necessary in order to enable the court effectually and completely to adjudicate upon or settle all questions involved in the suit, be added.”
In the Supreme Court of Kenya decision in Communications Commission of Kenya and 4 Others -v- Royal Media Services Limited & 7 Others Petition No. 15 OF [2014] eKLR the definition of an Interested Party is as follows: -
“An interested party is one who has a stake in the proceedings, though he or she was not party to the cause ab initio. He or she is one who will be affected by the decision of the Court when it is made, either way. Such a person feels that his or her interest will not be well articulated unless he himself or she herself appears in the proceedings, and champions his or her cause.”
In ELC NO. 231 Of 2017 Nicholas Mkoma Mkali & 253 Others V Yahya Mohamed Suleiman & 28 Others and Leonard Kurgat (DCIO Mtwapa) this court addressed the issue of who an interested party is and held as follows:
“13. The questions that follow therefore is who is an interested party? And does the Intended Interested Party herein fall within that category? Rule 2 of the Constitution of Kenya (Protection of Rights and Fundamental Freedoms) Practice and Procedure Rules, 2013 provides as follows:
“interested party” means a person or entity that has an identifiable stake or legal interest or duty in the proceedings before the court but is not a party to the proceedings or may not be directly involved in the litigation.””
I agree with the respondents that there being no specific procedure provided for under the CPR, rule 7 of the Constitution of Kenya (Protection of Rights and Fundamental Freedoms) Practice and Procedure Rules, 2013 is applicable to civil suits as well where joinder of an interested party is sought. Rule 7 provides as follows:
“7. Interested party
(1) A person, with leave of the Court, may make an oral or written application to be joined as an interested party.”
In that regard leave in civil matters for joinder needs to be sought as per rule 7. It appears that only the application of that rule that can maintain uniformity or predictability in matters joinder of interested parties.
The 1st defendant’s argument that the requirement of seeking prior leave is informed by the fact that the court requires to focus its mind on the nature of the claims by the intended interested party in order for it to determine if the application can pass muster. In an oral application a submission outlining the facts and the grounds relied on would suffice. In the present case nothing shows that Mr McCourt for the applicant herein orally applied for leave when he first appeared before this court on 9/10/2024.
The application before me does not have any prayer for leave preceding all the other prayers. It is therefore the case as submitted by the respondents that in the present application the applicant has no leave and secondly, it is attempting to obtain substantive orders of review of orders in an application seeking joinder, while it has not been joined to the suit.
In my view the appropriate procedure would have been first, the securing of leave, and then an application for joinder and thirdly the application for the substantive orders. It may appear to be a piecemeal approach to resolving the applicant’s issue but it is one that is supported by the only rules there are to rely on. But is the applicant’s omission to secure prior leave before seeking to be made an interested party or seeking the other substantive orders fatal to its case?
Pleadings and other documents are prepared by counsel where there is representation. Numerous cases have come up in the past where parties represented by advocates walked into procedural mishaps and the courts, upon assessing and finding little or no prejudice would be occasioned to the respondents, were inclined to overlook such mistakes in the interests of substantive justice. A famous case quoted every other day is the Philip Keipto Chemwolo & another v Augustine Kubende [1986] eklr.
In the case of Alexander Vincent Mabonga (Suing as the legal representative of Joseph Wekesa Tulula (Deceased) v Hilda Wanjiru Tulula & another [2020] eKLR it was stated as follows:
“Mistakes of counsel are common and in certain deserving cases this court is inclined to overlook those mistakes if only to do substantive justice to an applicant. In the case of Sheikh T/A Hasa Hauliers v Highway Carriers Ltd [1988] eKLR the Court of Appeal (Gachuhi, JA) observed as follows:
“It must be clear that the court is to administer justice through the procedure laid down. It is important in administering justice that the suit in court is between two litigants and the counsel is merely putting the case for his client forward. The litigant, may not be aware of the failure of his advocates in complying with rules. He is at the mercy of his advocate. It is the law of agency that the principal is bound by the acts of his agent. Yet in administering justice, why should the litigant suffer due to the mistakes and errors of his advocate.
If the court should be inclined to punish the advocate, it should state so and choose the appropriate punishment without injuring the litigant’s rights. Mr. Maosa relied on Pithon Waweru Maina v Thuki Mugiria (ibid) as an authority that a litigant should not be punished through the mistake of his counsel. This is what was referred to by Harris J in Shah v Mbogo, (ibid) so as to avoid miscarriage of justice. The judge misdirected himself in importing matters which caused miscarriage of justice.”
Here is an applicant who has explained that he was abroad by the time the crucial events and omissions in this case happened. It is clear that the judgment was delivered in the absence of the plaintiff and his counsel on 6/5/2019. The applicant was required to file a notice of appeal within 14 days of that date that is by 20/5/2019. He did not do so; it is evident that he tried to file a notice of appeal out of time on 13/6/2019 which he alleges was rejected by the court registry for being out of time; a request for certified copies of proceeding and judgment was also filed on the same date. Thereafter he filed the instant application on 30/7/2019, a period of 70 days from the delivery of judgment… Whether the applicant’s advocate is to blame for the mistake that led to the non-filing of the notice of appeal in time, that now does not matter; that the applicant, who relied on the services of his counsel who could have advised him appropriately but failed to do so, did not know of the new judgment date and that he was abroad by that time this court are sufficient reasons and on that account this court is inclined to extend the time for filing a notice of appeal as sought.”
The alternative to a joinder by application in Rule 7(a) is in Rule 7(b) and it is joinder by court suo moto. In that case the court considers a party’s interest in absentia by way of perusal of existing documents before it, which may not even include the absent party’s papers, and determines whether or not they ought to be joined to a suit despite no application having been made before it, and if it orders they are so joined. The question arising is: how just would it be to decline a joinder application on the basis of lack of a prior application for leave while this same court can order joinder to a suit of any party it considers suitable suo moto?
In this court’s view there would be no just reason why a person who, as the applicant herein, has given a detailed narrative justifying why they should be joined in this matter, should fail to secure joinder by application while a person who never applied can be joined suo moto by court. The reasoning behind the foregoing holding is that first, Order 1 Rule 10(2) into which Rule 7 is sought to be extrapolated demands no prior application for leave. Secondly, while Article 50 of the Constitution provides for the inalienable right of every person having a dispute that can be settled by application of law to be heard before an impartial court or tribunal or other body, the Constitution at Article 159(2) (d) provides that, to paraphrase, substantive justice shall not be hindered by technicalities. Article 50, in my view, focused on substantive disputes to determine rights in rem and rights in persona and not inter-party disputes regarding technicalities.
As the respondents responded to the application and raised this issue of lack of leave, I noted that they never submitted on how admitting the application for hearing even when no leave has been sought would occasion them substantive prejudice. In Philip Keipto Chemwolo & another v Augustine Kubende [1986] eklr it was stated as follows:
“True, there was some delay in entering appearance but I cannot accept it was an unreasonable delay, or it was the type that disables a plaintiff from relief in equity. At all events, such delay was satisfactorily explained. When I asked counsel for the respondent what loss or damage would result to him if this suit were admitted to a hearing on the merits, he said nothing that I think should inhibit the court from allowing this suit to be heard on its merits. I recorded counsel as saying that a court’s discretion should not be exercised in favour of a negligent applicant. I think the charge that the appellants were negligent is one that can be questioned. But counsel seems to think the defendants are deserving of punishment and must be shut out for their negligence.
I think a distinguished equity judge has said:
“Blunders will continue to be made from time to time and it does not follow that because a mistake has been made that a party should suffer the penalty of not having his case determined on its merits.”
I think the broad equity approach to this matter is that unless there is fraud or intention to overreach, there is no error or default that cannot be put right by payment of costs. The court, as is often said, exists for the purpose of deciding the rights of the parties and not for the purpose of imposing discipline. In this case, the appellants offered to pay the costs. The respondent will not agree.
I am unwilling to believe that in opposing the application for setting the judgment aside and allowing a hearing on the merits, the object of the respondent was to snap at the judgment in a case in which if the defendants were permitted a hearing, the quantum of the liability to pay damages may be much less.”
I am aware that the respondents’ counsel are inclined to follow their clients’ instructions and oppose the motion at hand and that is in order. That draws attention to the other side where Mr. McCourt is also simply arguing his client’s case and nothing more, save that in a misstep he failed to apply for leave as required by Rule 7. Without excusing sloppiness in legal practice regarding procedure, I am also not certain in how many cases counsel appearing for their clients in joinder applications have in circumstances of extreme urgency had time to extrapolate the provisions of Rule 7 of the Constitution of Kenya (Protection of Rights and Fundamental Freedoms) Practice and Procedure Rules, 2013 into the Civil Procedure Rules regime and use it, and in the absence of clear CPR provisions, this application may be just one among many where leave has not been sought. In the current constitutional dispensation that promotes substantive justice above procedure, I would be amiss to ignore the material the applicant has presented to attempt to justify joinder as in the final analysis even if I reverse his progress to the making of an application for leave, it will be still that material that matters; hence the procedural omission of securing of leave should not bar the court from assessing the merits of the proposed joinder. I hereby dismiss the objection based on the claim that the applicant lacks leave.
The second issue is jurisdiction. The issue of jurisdiction is crucial for without jurisdiction a court would have to down its tools in this matter. The basis for the claim of lack of jurisdiction is that the matter the applicant is concerned with relates not to use or occupation of land but to a charge which the Court of Appeal in the Co-Operative Bank Ltd Vs Patrick Njuguna Kangethe & 5 Others 2017 eKLR held to be a commercial transaction and thus not deserving to be handled in the Environment and Land Court. In that case the Court of Appeal held as follows:
“Accordingly, for land use to occur, the land must be utilized for the purpose for which the surface of the land, air above it or ground below it is adapted. To the law therefore, land use entails the application or employment of the surface of the land and/or the air above it and/ or ground below it according to the purpose for which that land is adapted. Neither the cujus doctrine nor Article 260 whether expressly or by implication recognizes charging land as connoting land use….
By definition, a charge is an interest in land securing the payment of money or money’s worth or the fulfillment of any condition (see Section 2 of the Land Act). As such, it gives rise to a relationship where one person acquires rights over the land of another as security in exchange for money or money’s worth. The rights so acquired are limited to the realization of the security so advanced (see Section 80 of the Land Act). The creation of that relationship therefore, has nothing to do with use of the land (as defined above). Indeed, that relationship is simply limited to ensuring that the chargee is assured of the repayment of the money he has advanced the chargor….
Furthermore, the jurisdiction of the ELC to deal with disputes relating to contracts under Section 13 of the ELC Act ought to be understood within the context of the court’s jurisdiction to deal with disputes connected to ‘use’ of land as discussed herein above. Such contracts, in our view, ought to be incidental to the ‘use’ of land; they do not include mortgages, charges, collection of dues and rents which fall within the civil jurisdiction of the High Court.”
In its submissions, the applicant avers that the predominant issue in its application is conversion of title. In the application the applicant seeks to have interim orders given by this court reviewed to accommodate the registration of a surrender and issuance of a lease over the suit land but that is not the end; its ultimate target is to secure the registration of a charge over that lease once issued. In this court’s view, first, not all the parties in the present suit are positively anxious that the charge be registered over the lease. Secondly, it is not a matter privy between the plaintiffs and the applicant; whether or not the ultimate registration of that lease, perchance it was permitted, would be prejudicial to the plaintiffs herein can not be deciphered at the moment but the notable thing is that even the plaintiffs are resisting it, and it would go beyond the scope of the present suit, even with the applicant joined as an interested party (if that were to happen) to delve into that issue.
All this court can say is that it is not correct as the applicant submits that the predominant issue in both the suit and the application is simply title conversion. The applicant seeks to enforce a contract regarding security for its credit advances to the 1st respondent by way of registration of a charge over the suit property in this case and that is a matter totally diverse from the claim of the plaintiffs that despite having paid the 1st defendant in full no transfer to them of their entitlement in terms of housing units has been accomplished. It is the issue for another forum as to whether those two are issues that can be tried in the same suit and not this application as this court is inclined to down its tools on jurisdictional grounds since it is not within the jurisdiction of this court to deal with matters concerning charges and mortgages as seen in Co-Operative Bank Ltd case (supra). For those reasons the motion ought to fail.
As the last preliminary point that this court has addressed herein above is sufficient to dispose of the motion before me, I therefore decline to grant any of the orders sought in the motion dated 30/9/2024 and the same is hereby dismissed with costs to the plaintiffs and the defendants. This suit shall be mentioned on 22/1/2014 for fixing of a hearing date.