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Court of AppealPartially AllowedCivil Appeal 6, 26 & 27 of 2011 (Consolidated)· [2014] KECA 880 (KLR)

Macharia Mwangi Maina & 87 Others v Davidson Mwangi Kagiri

Court of Appeal
22 January 2014
Martha Karambu KoomeMartha KoomePhilomena Mbete MwiluPhilomena MwiluJOJ. Otieno-Odek
6,766 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~27 min to read original · ~4 min brief

The bottom line

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Kenya's Court of Appeal ruled that plot buyers who paid in full and occupied the land keep it, even without Land Control Board consent.

What this practically means

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Executive summary

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This consolidated appeal (Civil Appeals 6, 26 and 27 of 2011) challenged a High Court judgment (Kasango, J) which granted the Respondent, Davidson Mwangi Kagiri, a permanent injunction and eviction order against 88 purchasers of plots subdivided from LR No 6324/8 at Nanyuki. The Respondent sold 240 one-acre plots between 1983 and 1990, received the full purchase price, and put the purchasers in possession, but never obtained Land Control Board consent for the transactions; after disputes over survey and title fees he rescinded the agreements. The High Court held the agreements void for want of consent and unenforceable against the registered proprietor. The Court of Appeal, as a first appeal, re-evaluated the evidence and allowed the appeal. It held that the purchasers, having been put in possession by the Respondent himself, enjoyed an overriding interest under section 30(g) of the repealed Registered Land Act which defeated indefeasibility of the Respondent's title to LR No 6324/10. It further held that the Respondent's receipt of the purchase price and delivery of possession created an implied and constructive trust in favour of the purchasers; a constructive trust over land subject to the Land Control Act is enforceable, and creating a trust is not a 'disposal' requiring Board consent. Guided by Article 159(2) of the Constitution and the overriding objective, the court held the Respondent could not renege, and that the suit property existed as LR No 6324/10 notwithstanding subdivision. The High Court judgment was set aside, the Respondent's plaint dismissed, judgment entered on the Appellants' counterclaim, with the 1983 Kamwere and Associates plan governing allocation, 16 acres retained by the Respondent, and the Respondent bearing all costs.

Key legal issues

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01

Indefeasibility of title versus overriding interests of persons in possession

Holding

The Appellants, put in possession by the Respondent as purchasers, came within the protection of section 30(g) of the Registered Land Act, creating an overriding interest that defeats the registered proprietor's title

Reasoning

Sections 27, 28 and 30 of the repealed Registered Land Act provide exceptions to indefeasibility. Section 30(g) protects rights of persons in actual occupation. The Respondent himself put the Appellants in possession pending transfer, so they were neither trespassers nor licensees. The trial judge erred in failing to consider that the Appellants were in possession before the title issued to the Respondent.

p. 7
02

Effect of lack of Land Control Board consent on sale agreements over agricultural land

Holding

Although lack of consent would ordinarily render the agreements void, the Respondent created an implied and constructive trust in favour of the purchasers, and a constructive trust over agricultural land is enforceable without Land Control Board consent

Reasoning

The Respondent received the full purchase price and put the purchasers in possession with the intention of transferring the plots. The creation of a trust is not an 'other disposal or dealing' under section 6(1) of the Land Control Act, so consent is not required. The court invoked Article 159(2) and the overriding objective to dispense substantive rather than technical justice, holding the Respondent could not renege.

p. 8
03

Existence of the suit property after subdivision

Holding

The suit property existed as LR No 6324/8, which upon subdivision became LR No 6324/10; the Respondent could not rely on the change he himself effected as a defence

Reasoning

The physical land was in existence throughout; subdivision merely changed its title description. The Respondent had actual knowledge of the Appellants' claims when the new title issued. Tracing is an equitable remedy, and all orders were declared to relate to LR No 6324/10. The Respondent, by supporting the High Court judgment, admitted the suit property was LR No 6324/10.

p. 3
04

Obligation to pay survey fees, stamp duty and other completion costs

Holding

Some sale agreements expressly placed these costs on the purchasers and others were silent; the court ordered each Appellant to bear the costs of surveying their plot, stamp duty and title fees

Reasoning

The court examined the sale agreements and noted that none of the charges were payable to the Respondent, only the purchase price was. Having found a constructive trust in favour of the purchasers, the court nonetheless directed each purchaser to meet the costs of surveying, stamp duty and obtaining individual titles.

p. 9

Legal principles established

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  • Possession and occupation by purchasers put in possession by the registered proprietor constitutes an overriding interest under section 30(g) of the Registered Land Act that binds the registered proprietor
  • A constructive trust relating to land subject to the Land Control Act is enforceable, and creation of a trust over agricultural land in a land control area does not require Land Control Board consent
  • A party cannot change the nature and character of the suit property and then plead the change as a defence to an action in relation to that property
  • On a first appeal, the Court of Appeal must analyze and re-assess the evidence and reach its own conclusions

Court orders

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  1. 1.Judgment and decree of the High Court (Kasango, J) set aside in its entirety
  2. 2.Judgment entered dismissing the Respondent's Plaint dated 16th August, 1993
  3. 3.Judgment entered in favour of the Appellants as per the Counterclaim in the Statement of Defence dated 1st September, 1993
  4. 4.The plan prepared by Kamwere and Associates in 1983 to be used to identify and allocate the individual plots
  5. 5.Each Appellant to pay the costs of surveying his/her respective plot, the requisite stamp duty and any fees necessary to secure and obtain individual title deeds
  6. 6.16 acres of land where the Respondent's house is situated to remain the property of the Respondent and be registered in his name
  7. 7.All orders declared to be in respect of the property now known as LR No 6324/10 in the name of the Respondent
  8. 8.Respondent to bear the costs of the suit before the High Court and the costs of the Appeal

Authorities

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Legislation

  • Registered Land Act (cap 300) (repealed)section 28
  • Registered Land Act (cap 300) (repealed)section 30(g)
  • Registered Land Act (cap 300) (repealed)section 27
  • Registered Land Act (cap 300) (repealed)section 126(1)
  • Registered Land Act (cap 300) (repealed)section 163
  • Land Control Act (cap 302)section 6(1)
  • Land Control Act (cap 302)section 7
  • Constitution of Kenya 2010article 159(2)(a)
  • Constitution of Kenya 2010article 159(2)(b)
  • Constitution of Kenya 2010article 159(2)(g)
  • Appellate Jurisdiction Act (cap 8)Overriding Objective principles

Cases cited (20)

  • Selle & another v Associated Motor Boat Co Ltd
    [1968] EA 123

    Duties of a first appellate court to re-evaluate evidence and draw its own conclusions

  • Michael Githinji Kimotho v Nicholas Muratha Mugo
    Civil Appeal No 53 of 1995

    Section 28 rights of a proprietor cannot be defeated except as provided in the Act, certainly not at the instance of a trespasser

  • Mwangi & another v Mwangi
    (1986) KLR 328

    Rights of persons in possession are equitable rights binding on land; reference to a trustee under section 126(1) is permissive; trust creation over land-control land needs no consent

  • Mutsonga v Nyati
    (1984) KLR 425

    Implied, constructive and resulting trusts apply to registered land via section 163 of the Registered Land Act

  • Kanyi v Muthiora
    (1984) KLR 712

    Equitable doctrines of implied, constructive and resulting trusts applicable to registered land

  • Yaxley v Gotts & another
    (2000) Ch D 162

    Oral agreement for sale of property enforceable on basis of constructive trust or proprietary estoppel despite being void as a contract

  • Llyods Bank Plc v Rosset
    [1991] 1 AC 107, 132

    Constructive trust based on common intention relied on and acted on by the claimant

  • Steadman v Steadman
    [1976] AC 536, 540

    Party who lets another incur expense on the faith of an agreement cannot later assert it is unenforceable

  • Gatimu Kinguru v Muya Gathangi
    [1976] KLR 253

    Creation of a trust over agricultural land in a land control area is not an 'other disposal or dealing' requiring Land Control Board consent

  • Hussey v Palmer
    [1972] 3 All ER 744

    Constructive trust imposed by law whenever justice and good conscience require it; equitable remedy enabling restitution

  • Chase International Investment Corporation and Another v Laxman Keshra and others
    [1978] KLR 143; [1976-80] 1 KLR 891

    Madan JA's dicta: where circumstances raise equity in favour of the plaintiff, the plaintiff is entitled to succeed

  • Kariuki v Kariuki
    1983 KLR 226

    Remedy of recovering purchase price under section 7 of the Land Control Act (cited by Respondent)

  • Njamunyu v Nyaga
    (1983) KLR 282

    Land Control Board consent does not make an agreement binding; not enforceable until consent given

  • Hirani Ngaithe Githire v Wanjiku Munge
    (1979) KLR 50

    Failure to obtain consent makes sale agreement void for all intents and purposes; no equity can soften the mandatory provision

  • Githu v Katibi
    (1990) KLR 634

    Transaction null and void for want of Land Control Board consent (cited by Respondent)

  • Kahia v Nganga
    (2004) 1 EA 75

    Cited by Respondent on voidness for want of consent

  • Jacob Gichuki Minjire v Agricultural Finance Corporation
    Civil Appeal No 61 of 1982

    Cited by Respondent on voidness for want of consent

  • Richard Satia & Partners & another v Samson Sichangi
    Civil Appeal No 164 of 1995

    Cited by Respondent on voidness for want of consent

  • Simiyu v Watambamala
    (1985) KLR 852

    Cited by Respondent on voidness for want of consent

  • Abdul Hameed Saif v Ali Mohamed Sholan
    (1955), 22 EACA 270

    Appellate court not bound to follow trial judge's findings of fact where he failed to take account of material circumstances

On appeal from
High Court at Meru
Plaint dated 16th August, 1993 (High Court suit)
Jurisdiction invoked
First appeal to the Court of Appeal under the Appellate Jurisdiction Act (Cap 8); constitutional values of Article 159(2) of the Constitution of Kenya 2010 invoked

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (25)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Macharia Mwangi Maina & 87 Others v Davidson Mwangi Kagiri", Case Analysis (2014). Civil Appeal 6, 26 & 27 of 2011 (Consolidated). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2014/880/eng@2014-01-22

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.