Skip to content
AI-generated case briefs sourced from Kenya Law · Not legal advice
AI-generated case brief
Case Brief · caselaw.co.ke
Court of AppealAllowedCivil Appeal No 146 of 2014· [2017] KECA 700 (KLR)

Mungai (Attorney of Francis Muroki Mwaura v Attorney General & 4 others (Civil Appeal 146 of 2014) [2017] KECA 700 (KLR)

Court of Appeal of Kenya
10 March 2017
2,508 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~10 min to read original · ~4 min brief

The bottom line

#

Kenya's Court of Appeal cancelled land titles bought from a fraudster because the buyers failed to prove they were genuinely innocent purchasers.

What this practically means

#

Executive summary

#
The appellant, acting under a power of attorney for Professor Francis Muroki Mwaura, sued to cancel titles issued to the 3rd, 4th and 5th respondents over L.R. Ruiru/Ruiru 7/13 after discovering that the 2nd respondent had fraudulently procured registration of the suit property and then sold it to the respondents. The Environment & Land Court dismissed the suit, holding that the respondents, having purchased from the then-registered owner after an official search, were innocent purchasers for value whose title was absolute and indefeasible under sections 26(1) and 80 of the Land Registration Act, and ordered each party to bear its own costs. On appeal, the Court of Appeal (Musinga, Gatembu Kairu and Murgor, JJ.A) reversed. It found that the 3rd respondent's conduct - no written sale agreement contrary to section 3 of the Law of Contract Act, no verification of the vendor's identity, no stamp duty receipt, no copy of the transfer, and failure to call the advocate who allegedly witnessed the transaction - fell far short of the diligence required of a bona fide purchaser as defined in Katende v Haridar & Company Limited. The trial judge had also failed to apply section 26(1)(b) and section 80 of the Land Registration Act, which permit challenge to titles acquired illegally, unprocedurally or through a corrupt scheme and empower rectification of the register obtained by fraud or mistake. Relying further on the principle that a property cannot have two valid titles and that the first in time prevails, the Court allowed the appeal, set aside the decree of 10th May 2013, entered judgment for the appellant as prayed in the amended plaint, and ordered the 2nd to 5th respondents jointly and severally to bear costs of the appeal and the trial court.

Key legal issues

#
01

Whether the 3rd, 4th and 5th respondents were innocent purchasers for value without notice entitled to protection under sections 26(1) and 80(2) of the Land Registration Act

Holding

The Court of Appeal held that they were not innocent purchasers for value; their conduct fell short of the diligence required of a bona fide purchaser and their title was therefore challengeable and liable to rectification.

Reasoning

The 3rd respondent did not enter into a written sale agreement, did not verify the vendor's identity, made no effort to ascertain the vendor after suit commenced, produced no receipt for stamp duty and did not have a copy of the transfer. He was a Director of a Tea Factory who knew or ought to have known the requirements of a land transaction. His advocate, who allegedly witnessed the oral agreement and payment, was not called as a witness. Such conduct was negligent and inconsistent with bona fide purchaser status.

p. 5
02

Whether the trial judge erred in failing to apply section 26(1)(b) and section 80 of the Land Registration Act

Holding

Yes; the trial judge failed to consider whether the Title Deed had been acquired procedurally or through a corrupt scheme, and failed to apply section 80 which empowers rectification of the register where a registration was obtained by fraud or mistake.

Reasoning

The appellant had established that the 2nd respondent fraudulently obtained title. Section 26(1)(b) permits challenge to a certificate of title acquired illegally, unprocedurally or through a corrupt scheme. Section 80(1) empowers the court to order rectification where registration was obtained by fraud or mistake, subject only to the protection of a proprietor in possession for valuable consideration without knowledge of the fraud. Since the respondents did not qualify for that protection, rectification should have been ordered.

p. 5
03

Whether a property can have two valid title deeds

Holding

No. Where a property has two titles, the first in time prevails even if the second was issued by mistake.

Reasoning

The appellant still held a valid Title Deed issued in 1992 while the 2nd respondent was allegedly issued a Title Deed for the same property in 1996. The court invoked Gitwany Investment Limited v Tajmal Limited to affirm that the earlier title prevails over a later one, even one issued by mistake.

p. 5

Legal principles established

#
  • A purchaser cannot rely on indefeasibility of title where his own acquisition was irregular; the court may order rectification of the register where a registration was obtained by fraud or mistake even against a subsequent purchaser who fails to demonstrate bona fides.
  • A property cannot have two valid title deeds; where two titles exist, the first in time prevails even if the second was issued by mistake.

Court orders

#
  1. 1.Appeal allowed
  2. 2.Decree made on 10th May, 2013 set aside
  3. 3.Judgment entered for the appellant as prayed in the Amended Plaint dated 18th August, 2008
  4. 4.2nd, 3rd, 4th and 5th respondents to jointly and severally bear the costs of the appeal as well as the costs in the trial court

Authorities

#

Legislation

  • Land Registration Actsection 26(1)
  • Land Registration Actsection 26(1)(a)
  • Land Registration Actsection 26(1)(b)
  • Land Registration Actsection 80(1)
  • Land Registration Actsection 80(2)
  • Law of Contract Actsection 3

Cases cited (2)

  • Katende v Haridar & Company Limited
    [2008] 2 E.A. 173
  • Gitwany Investment Limited v Tajmal Limited & 3 Others
    [2006] eKLR
On appeal from
Environment & Land Court
Not stated in the judgment
Jurisdiction invoked
First appeal to the Court of Appeal under the applicable appellate statute (not expressly cited in the judgment)

Key timeline

#

Practical implications

#

Frequently asked questions

#

Cite this brief

#

Cite this brief

Caselaw, "Mungai (Attorney of Francis Muroki Mwaura v Attorney General & 4 others (Civil Appeal 146 of 2014) [2017] KECA 700 (KLR)", Case Analysis (2017). Civil Appeal No 146 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2017/700/eng@2017-03-10

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