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Court of AppealDismissedCivil Appeal No. 185 of 2009· [2016] KECA 765 (KLR)

Seraphine Ndinda Kitaka & 2 others v Praxedes Nzisa Wambua & 6 others [2016] KECA 765 (KLR)

Court of Appeal of Kenya
22 February 2016
3,286 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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The Court of Appeal ruled that Kenyans who withdraw from a group and get their money back lose any claim to the group's land or assets.

What this practically means

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Executive summary

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This was a first appeal against the judgment and decree of Lenaola J in H.C.C.C No. 7 of 2003 at Machakos, by which the High Court declared the respondents the lawful owners of Plot No. Makueni/Unoa/11, declared that the appellants had ceased to be members of Wote Township Women Group, and granted a permanent injunction restraining the appellants from trespassing on the plot. The respondents and appellants were at one time members of the same women's group, and the appellants counter-claimed that having contributed Ksh.4,000 each towards purchase of the plot, they were joint owners entitled to occupy it, claiming refunds of extra contributions. In a single joint judgment, the Court of Appeal re-evaluated the evidence, as it was obliged to do on a first appeal. It upheld the trial court's findings that members who withdrew and were refunded their contributions have no claim to any asset of the group including the land. The 1st appellant, who expressed willingness to withdraw and had accounts taken, could not approbate and reprobate; her claim was extinguished and converted to a right to account, with any monies owed to the Group set off against her contributions. The 2nd appellant, never refunded, was entitled only to accounts and refund, not a share of the land, a finding of the trial court the court declined to disturb. The letters of administration argument failed as the dispute was not a succession dispute and the point would defeat the appellants' own claim. A 'merry go round' was held to create no enforceable legal relationship, and partnership was neither pleaded nor particularized. The appeal was dismissed with costs to the respondents.

Key legal issues

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01

Effect of withdrawal and refund of contributions on a member's claim to group assets

Holding

Members who withdrew and were refunded their contributions have no claim to the suit property or any asset of the group.

Reasoning

Exhibits recording refunds and withdrawal, including the 3rd appellant's signed acknowledgement, were never challenged. The court held that refund of contributions and cessation of membership extinguish any entitlement to the group's land. The 1st appellant, having expressed willingness to withdraw and having had accounts taken, could not approbate and reprobate by claiming ownership while owing the group monies.

p. 5
02

Rights of members who withdrew but were never refunded

Holding

Their right is a right to accounts and refund of contributions, not a share of the land; the trial court's finding to this effect was sound in law and not disturbed.

Reasoning

The 2nd appellant ceased making contributions; what remained was only a refund of her contribution. The court agreed with the trial judge that the claim of members not refunded lies in an order of accounts, not a share of the land. Even if the relationship were a partnership, on dissolution individual partners are entitled to accounts rather than ownership of specific assets.

p. 5
03

Whether the sale was void for want of letters of administration

Holding

The issue was not raised in the pleadings, and in any event the dispute was not a succession dispute; the argument would also destroy the appellants' own claim of ownership.

Reasoning

The 1st appellant's own testimony identified Julius Mutua Kioko as the seller with whom she signed the sale agreement, so raising letters of administration was prevarication. If the sale were void, the appellants would equally have acquired no proprietary interest, leaving no basis for their claim of ownership.

p. 5
04

Whether a 'merry go round' or an unpleaded partnership confers rights over the land

Holding

A merry go round creates no enforceable legal relationship, and partnership was neither pleaded nor particularized; even if it were a partnership, the remedy would be accounts.

Reasoning

Neither the plaint nor the defence and counterclaim pleaded partnership, and the facts determining its existence were not particularized. The court characterised the merry go round as a voluntary, informal, nebulous association whose obligations are enforced through moral and compassionate values rather than law.

p. 5

Legal principles established

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  • A member of a group or association who withdraws and is refunded her contribution has no further claim to any asset of the group, including land purchased by the group.
  • A member who expressed willingness to withdraw and whose accounts were taken, but was not refunded, has only a right to accounts or refund of her contribution, not a proprietary claim to the group's land; a party cannot approbate and reprobate.
  • A 'merry go round' arrangement as practised in Kenya creates no legal relationship and is not a legal person, partnership or society.
  • On a first appeal, the Court of Appeal is obliged to re-evaluate the evidence on record and arrive at its own conclusions.
  • Business records and minutes whose veracity was never challenged at trial remain intact and admissible as evidence of the transactions they record.

Court orders

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  1. 1.The appeal is dismissed in its entirety
  2. 2.The appellants to pay the respondents' costs of the appeal

Authorities

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Legislation

  • Partnership ActSection 18
  • Partnership ActSection 27
  • Succession Act (Cap 160 Laws of Kenya)Section 45(1)
  • Evidence ActSection 15
  • Evidence ActSection 16

Cases cited (4)

  • Gitau & 2 others -v- Wandai & 5 Others
    (1989) KLR 23
  • William Muthee -v- Bank of Baroda
    Civil Appeal No. 21 of 2006 [2014] eKLR
  • Selle -vs- Associated Motor Boat Co.
    [1968] EA 123
  • Abdul Hameed Saif vs. Ali Mohamed Sholan
    (1955) 22 E. A. C. A. 270
On appeal from
High Court of Kenya at Machakos
H.C.C.C No. 7 of 2003
Jurisdiction invoked
First appeal to the Court of Appeal under the Court of Appeal's appellate jurisdiction

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (2)

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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, "Seraphine Ndinda Kitaka & 2 others v Praxedes Nzisa Wambua & 6 others [2016] KECA 765 (KLR)", Case Analysis (2016). Civil Appeal No. 185 of 2009. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2016/765/eng@2016-02-02

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