Hatayan & another v Al-Heidy & 5 others (Civil Appeal 51 of 2014) [2015] KECA 713 (KLR)

The court traced the doctrine of trusts from Black's Law Dictionary, the Trustee Act and Halsbury's, distinguishing constructive from resulting trusts. Because the purchase price came from the 1st appellant's wife and she never testified, her intention could not be established and no automatic resulting trust in the appellants' favour could be presumed. The appellants never met the respondents, were never privy to the trust agreement, and their evidence without the wife's was hearsay; the divergence between evidence and pleadings was fatal to their claim.

Quoting Rose v Inland Revenue Commissioners and Snell's Equity, the court held that in equity a gift is complete when the donee has within his control all things necessary to complete his title. The respondents bought the suit premises and constructed a madrassa, fulfilling the purpose of the donation. No condition prohibited sale of the premises, and the trust deed empowered trustees in their absolute discretion to sell trust property. The appellants could therefore neither recall the donation nor stop the intended sale to the third party.

The court affirmed that it is normal for a court to dispose of a suit on a central issue where it is dispositive, rejecting the appellants' complaint that the trial judge failed to evaluate all facts and issues. The core issue was whether a fulfilled donation was recallable, and the trial court was entitled to confine itself to it.

While a trust beneficiary may sue a trustee despite not being party to the trust contract, the appellants sued in their own right although they neither met the respondents nor knew of the trust; the proper plaintiff was the 1st appellant's wife as settlor. The court characterised the appellants as strangers and busybodies to the transaction.