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Court of AppealAllowedCivil Appeal No. 127 of 2014· [2017] KECA 712 (KLR)

Margaret Wairimu Warima v Phylis Wanjiru Thairu & 2 others [2017] KECA 712 (KLR)

Court of Appeal of Kenya
10 March 2017
PWP. N. WakiWKW. KaranjaPKP. O. Kiage
5,772 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~23 min to read original · ~4 min brief

The bottom line

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Kenya's Court of Appeal cancelled a fraud-tainted land lease, confirming that unchallenged fraud allegations in a plaint count as admitted.

What this practically means

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Executive summary

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This first appeal concerned Umoja plot Nairobi/Umoja Block 107/1/CU/999. The appellant, Margaret, bought the plot from the first respondent Phylis in 1989, paid the price and the City Council loan, took possession and developed it. After falling out with her cohabitee (the deceased), the deceased obtained a second sale agreement from Phylis in 1997 and a power of attorney, paid off the loan and began processing transfer. Margaret sued, and status quo orders were issued, but after the deceased's death his customary widow Grace obtained a certificate of lease from the City Council in 2001 despite the pending suit. Sitati, J. dismissed Margaret's suit in 2010, holding Grace's registered title protected under the Registered Land Act and Margaret's agreement null and void. The Court of Appeal, exercising its Rule 29(1)(a) first-appeal powers, reversed on four issues. First, the respondents' failure to file amended defences to the particularised fraud allegations amounted to deemed admission under Order VI rule 9(3). Second, the 1989 agreement was valid - section 3(3) of the Law of Contract Act as then in force required no advocate-drawn or typed document, and part performance was proved. Third, the transfer to Grace was vitiated by fraud and breach of status quo orders and lis pendens; because this was not a first registration, section 143 RLA allowed rectification, and Grace, lacking possession and consideration, fell outside the protective proviso. The appeal was allowed, the High Court judgment set aside, judgment entered in terms of prayers (a), (ai), (b) and (bi) of the Re-Amended plaint, the certificate of lease cancelled, and costs awarded to the appellant both here and below.

Key legal issues

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01

Whether untraversed particulars of fraud are deemed admitted

Holding

Yes. The respondents filed defences to the original plaint but filed no amended defences after fraud was particularised in the Re-Amended plaint; under Order VI rule 9(3) CPR the untraversed particulars were admitted.

Reasoning

Rule 9(3) requires every allegation of fact in a plaint intended to be resisted to be specifically traversed; a general denial is insufficient. Although the original defences traversed the fraud generally, no particulars were pleaded there, making them bad in law, and nothing was filed after the amendment. Authorities including Pharmaceutical Manufacturing Co support this construction of the rule.

p. 6
02

Validity of the 1989 agreement between Margaret and Phylis

Holding

Valid and enforceable. It satisfied section 3(3) of the Law of Contract Act as then in force; there was no requirement of advocate-drawn or typed documents, and part performance (possession, developments, loan repayments) was proved.

Reasoning

The High Court struck down the agreement because it was not drawn by an advocate and names were handwritten, but section 3(3) as it existed in 1989 only required writing and signature, with a proviso saving part performance. Margaret proved payment, possession, and developments through independent witnesses, and the seller never refuted the payment evidence.

p. 7
03

Whether the transfer to Grace was vitiated by fraud and open to rectification despite the Registered Land Act

Holding

Yes. Fraud was proved to a standard above balance of probability; the transfer breached status quo orders and lis pendens, and being a derivative (not first) registration, section 143 RLA permitted rectification.

Reasoning

The High Court erred in treating the title as indefeasible because this was not a first registration - the NCC was first registered head lessee. Grace was aware of the pending suit, was not in possession and gave no consideration, so the section 143(2) proviso did not protect her. The NCC expert confirmed transfer procedures were not followed.

p. 9

Legal principles established

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  • Failure to traverse or sufficiently traverse specific averments of fact in a plaint, including particulars of fraud, amounts to admission of those facts under Order VI rule 9(3) of the Civil Procedure Rules.
  • Section 3(3) of the Law of Contract Act as it stood before amendment did not require a contract for the disposition of an interest in land to be drawn or typed by an advocate; part performance by taking possession saves an unwritten contract.
  • Section 143 of the (repealed) Registered Land Act empowers a court to order rectification of a registration (other than a first registration) obtained by fraud or mistake, and the proviso protecting a proprietor in possession for value does not shield one without possession or consideration.
  • The doctrine of lis pendens, as a rule of common law and statute, renders an alienation of property in litigation pendente lite subject to the judgment in that suit, even against a purchaser without notice.

Court orders

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  1. 1.The orders issued by the High Court are set aside
  2. 2.Judgment entered in favour of the plaintiff in terms of prayers (a), (ai), (b) and (bi) of the Re-Amended plaint dated 25th September, 2003
  3. 3.The certificate of lease issued to Grace be cancelled
  4. 4.The appellant shall have the costs of this appeal and of the suit before the High Court

Authorities

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Legislation

  • Civil Procedure RulesOrder VI rule 9 (now Order 2 rule 11)
  • Law of Contract Act, Cap 23Section 3(3)
  • Registered Land Act, Cap 300 (now repealed)Sections 27, 28, 30, 143(1), 143(2)
  • Advocates Actnull
  • Court of Appeal Rules, 2010Rule 29(1)(a)

Cases cited (7)

  • Pharmaceutical Manufacturing Co vs. Novelty Manufacturing Ltd
    [2001] eKLR
  • Koinange & 13 Others vs. Koinange
    [1986] KLR 23
  • Naftali Ruthi Kinyua vs. Patrick Thuita Gachure & Another
    [2015] eKLR
  • Festus Ogada vs. Hans Mollin
    [2009] eKLR
  • Bellamy vs. Sabine
    [1857] 1 De J 566
  • Mawji vs. US International University & Another
    [1976] KLR 185
  • Mutete Ndonye vs. Muli Munyao & 4 Others
    [2012] EKLR
On appeal from
High Court of Kenya at Nairobi
H.C.C.C. No. 2670 of 1998
Jurisdiction invoked
First appeal under Rule 29(1)(a) of the Court of Appeal Rules, 2010

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (10)

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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, "Margaret Wairimu Warima v Phylis Wanjiru Thairu & 2 others [2017] KECA 712 (KLR)", Case Analysis (2017). Civil Appeal No. 127 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2017/712/eng@2017-03-10

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