Conflicts between tenants and landlords are inevitable. The disagreement many times raises issues that more often than not find themselves before seats of justice. In particular, the tenancies that are not controlled. Where then can such conflicts, if and when they arise, be taken to a court of the first instance? That is the single most important question that this paper will delve right into it. Following the recent judgment by D.A. Majanja J, stakeholders need to know the new development so that they can apply accordingly.
BRIEF FACTS OF THE CASE.
The case was an appeal from the judgment and decree by RM/Adjudicator delivered sometime in February 2022. The Appellant claimed Kshs. 1, 000,000.00 as rent arrears in which the Respondent has rented the Appellant’s house for 6 months with rent payment of Kshs. 150, 000 per month. She defaulted to pay rent of Kshs. 900,000.00. The adjudicator at trial concluded that the Appellant had failed to prove that there was a contract for rental services between her and the Respondent as the correspondence did not prove or support the case.
JURISDICTION OF THE SMALL CLAIMS COURT.
It is long held dicta that jurisdiction is everything and that without it, a body cannot purport to do anything – Owners of the Motor Vessel “Lillian S” Vs Caltex Oil (Kenya) ltd (1989) KLR 1. The jurisdiction of the SCC is enshrined in the Small Claims Court Act of 2016, in particular section 12. It provides for the nature and pecuniary jurisdiction of the court as:
(a) a contract for the sale and supply of goods or services;
(b) a contract relating to money held and received;
(c) liability in tort in respect of loss or damage caused to any property or for the delivery or recovery of movable property;
(d) compensation for personal injuries; and
(e) set-off and counterclaim under any contract.
It is also important to note that the pecuniary jurisdiction of the court is limited to Kshs. 1, 000,000.00. From the express reading of provisions of the SCCA, we cannot see the conferment of rent and rent arrears jurisdiction to the court.
WHERE THERE IS NO SUBSISTING TENANCY.
At times rent default extent beyond the period of the tenancy agreement. That the tenant is in default of rent for a certain amount but by that time, the tenancy would have been terminated or has ended according to the tenancy agreement. What the court has held on this is that rent arrears can be collected as debt. This was the holding in the case of Charles Kakai Manyungu Channan Vs David Mukwanja (2019). From the above upshot, it is important for the court to first satisfy itself as to the existence of a tenancy agreement or lack of the same. This is one of the factors that will determine the jurisdiction of a particular matter. If it is on rent and/or rent arrears, it will fall under Magistrate courts subject to pecuniary consideration.
DOES SECTION 12 OF THE SCCA APPLY TO ‘RENT OR RENT ARREARS?
Section 12 of the SCCA gives the jurisdiction of the Small Claims Court and the categories that fall within it. The court pointed out that rent has a specific known connotation that does not extend to the contract of services. The Appellant coiled its argument as one for rental services. It was the court’s view that trying to augment the scope of the meaning of the “contract of service” to include rent is tantamount to expanding the jurisdiction of the court by craft or innovation. In other words, it will amount to a court of law or litigants arrogating jurisdiction to a court. This goes against the principle that jurisdiction emanates either from, the Constitution or legislation or both – case of Samuel Kamau Macharia Vs Kenya Commercial Bank and Others SCK Application No. 2 of 2011 (2011) eKLR.
The learned judge also noted that a claim for rent does not fall within the armpits of; ‘money held and received’, the landlord in a claim for rent arrears does not hold any money that is due to a tenant nor does the claim for rent give rise to tortious liability or a claim for compensation. The court, therefore, proceeded to declare that the Small Claims Court does not have jurisdiction to hear and determine matters of the claim for rent.
It, therefore, seems that claims for rent or rent arrears fall in the Magistrates’ courts. Section 7 of the Magistrate’s Court Act, 2015 provides for the jurisdiction of the Magistrate court which is pecuniary in nature. Any matter whose pecuniary nature does not exceed 20 Million Kshs is taken to the Magistrate court. For the matter at hand, the best forum would have been to be launched before the Magistrate court presided over by a Resident Magistrate in accordance with section 7(1) (e) of the Magistrates Court’s Act, 2015.
An appeal from such a court shall be taken to the Environment and Land Court in line with Article 162(2)(b) of the Constitution of Kenya as read together with section 13 of the Environment and Land Court Act, 2011. Section 13 (4) of the ELC Act in particular provides that “In addition to the matters referred to in subsections (1) and (2), the Court shall exercise appellate jurisdiction over the decisions of subordinate courts or local tribunals in respect of matters falling within the jurisdiction of the Court”.
In conclusion, the Small Claims Court does not have jurisdiction to hear and determine issues to do with rent and/or rent arrears. This is the preserve of the Magistrates Court and an appeal is to be taken to the Environmental and Land Court. Until the decision is overturned on appeal, it seems that all matters on the claim of rent will now be going to the Magistrate court. This jurisdiction, however, must not be confused with the jurisdiction that the Business Premises Rent Tribunal has over controlled Tenancies. This jurisdiction is covered by section 12 of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act of 2015.