Suraj Plaza Limited & 3 others v Tabitha Wangeci Nderitu [2017] KECA 241 (KLR)
The bottom line
#The Court of Appeal confirmed that fraudulent property and share transfers can be undone in Kenya when documents lack genuine signatures and proper formalities.
What this practically means
#Executive summary
#Key legal issues
#Standard and burden of proof in civil claims
The respondent bore the burden of proving fraud on a balance of probabilities, which she discharged
The court adopted Selle v Associates Motor Boat Company on the retrial nature of first appeals and Palace Investments/Miller v Minister of Pensions on the balance-of-probabilities standard. Section 107 of the Evidence Act places the burden on the one who alleges. The court found the respondent had demonstrated, through the irregularities in the registration, that the indenture of 7th September 2001 was fraudulent and that Simon never transferred his 45 shares.
Authenticity of the indenture transferring the suit property
The indenture dated 7th September 2001, not the one dated 7th January 1998, was presented for registration by the appellants and conveyed the suit property fraudulently
Entry No. 24 on the title recorded an assignment dated 7th September 2001; no penalty for late registration was paid, which would have been payable had the 1998 indenture been the one registered; the appellants disowned the September 2001 indenture; V.M. Patel died in 2001 and Simon was incapacitated from 1998, so neither could have signed it. The corroborating correspondence from Riunga Raiji never alleged purchase of the suit property.
Transfer of Simon's 45 shares in the 1st appellant
The respondent proved that Simon never transferred his 45 shares; the transfer was fraught with irregularities
The company secretary was not called as a witness and did not sign the transfer deed; the witness to the transferees' signatures was a brother of the transferees; no notice in writing of intention to transfer was given as required by the Articles of Association; no resignation by Simon was filed at the Companies Registry; the registry file was missing; and no stamp duty was paid on the share transfer.
Conduct of parties as evidence against the alleged sale
The appellants' own correspondence in 2001 never alleged that they had purchased the suit property, undermining their claim of a 1998 sale
Letters of April 2001 from Riunga Raiji & Co asserted the 1st appellant was collecting rent as Simon's agent and was owed Ksh.1,542,057.60, offering to stop collecting rent if repaid. In none of the letters was a purchase of the suit property alleged, nor was this debt counterclaimed. The respondent also constructed a one-storeyed building on the property without objection from the appellants.
Legal principles established
#- A first appellate court must re-analyse and re-evaluate the evidence tendered at trial while bearing in mind it did not hear or observe the demeanour of the witnesses
- An appellate court will not interfere with a finding of fact by a trial court unless it is based on no evidence or the judge demonstrably acted on wrong principles
- Civil claims are proved on a balance of probabilities, and the burden of proof lies on the party who alleges
Court orders
#- 1.Appeal dismissed
- 2.Appellants to pay costs of the appeal
- On appeal from
- High Court of Kenya at Nairobi
- H.C.C.C. No. 414 of 2003 consolidated with H.C.C.C. 1261 of 2002
- Jurisdiction invoked
- First appellate jurisdiction over appeals from the High Court (Court of Appeal hearing appeal against judgment of the High Court)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Suraj Plaza Limited & 3 others v Tabitha Wangeci Nderitu [2017] KECA 241 (KLR)", Case Analysis (2017). Civil Appeal No. 270 of 2011. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2017/241/eng@2017-09-29
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.