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ELCAllowedNot stated in the judgment as provided· [2015] KEELC 461 (KLR)

Francis K. Baya & 2 others v Sammy Mutile & another [2015] KEELC 461 (KLR)

Environment and Land Court
12 June 2015
5,863 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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A Kenyan court ordered officials who registered donor-bought land in their own names to transfer it back to the community organisation that paid for it.

What this practically means

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Executive summary

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The Plaintiffs, suing as Chairman, Secretary and Treasurer of Rainbow Community Care Kibokoni, a registered Community Based Organization, sought an order compelling the Defendants to transfer two parcels of land, Kilifi/Kibokoni/Block M 13D/113 and 114, on which an orphanage home and clinic stand, to the organization. The 2nd Defendant was struck out of the suit and testified for the Plaintiffs. The Plaintiffs' case was that the properties were purchased with donor funds remitted from Italy and channelled through the organization's bank accounts, but registered in the Defendants' personal names. The 1st Defendant claimed the plots were bought with his own money and that he only permitted community developments on them as a founder. The court found the Plaintiffs had locus standi, the 1st Defendant having admitted their official status in his Defence under Order 2 Rule 11(1) of the Civil Procedure Rules. Financial statements, bank statements and purchase agreements produced by PW5 showed the purchase cheques issued from the organization's accounts, while the 1st Defendant, unemployed since 1996, adduced no evidence of independent income. The Defendants' own written agreements of 8th May 2010, 6th October 2010 and 21st October 2010 acknowledged donor purchase. Applying the constructive and resulting trust principles in Hussey v Palmer, Gissing v Gissing and Stephen Mkare Mulewa v Linda Newman, and Section 28 of the Registered Land Act, the court held the Defendants hold the properties in trust for the organization. The Plaint dated 17th November 2010 was allowed: the Defendants were ordered to sign transfer documents within seven days, the Deputy Registrar to execute transfer on default, a permanent injunction issued against the 1st Defendant, and the 1st Defendant ordered to pay the Plaintiffs' costs.

Key legal issues

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01

Locus standi of the Plaintiffs

Holding

The Plaintiffs, as admitted officials of the CBO, had locus standi; the 1st Defendant admitted their status in the Defence and could not resile in submissions

Reasoning

Being a community based organization or self-help group, it can only sue or be sued through its officials. The Plaint described themselves as Chairman, Secretary and Treasurer. The 1st Defendant admitted paragraphs 1, 2 and 3 of the Plaint in his Defence, and under Order 2 Rule 11(1) such allegations are deemed admitted unless traversed. The locus standi objection in submissions therefore had no basis.

p. 5
02

Source of purchase funds for the suit properties

Holding

The suit properties were purchased with donor funds remitted to the Plaintiffs' organization; the 1st Defendant contributed nothing of his own

Reasoning

PW5's unchallenged evidence of financial statements and bank statements showed the purchase cheques issued from Rainbow Community Care's accounts. The 1st Defendant, unemployed since 1996, adduced no evidence of personal income. His claim that school-fee donations bought the plots was improbable since he never registered a private school or issued fee structures. The three written agreements signed by the Defendants also acknowledged donor purchase.

p. 9
03

Whether Defendants hold the suit properties in trust for the Plaintiffs' organization

Holding

Yes; registration in the Defendants' names gave rise to a resulting trust, and they must transfer the properties

Reasoning

Applying Hussey v Palmer and Stephen Mkare Mulewa v Linda Newman, property purchased with another's money is held on constructive/resulting trust proportionate to the contribution. Section 28 of the Registered Land Act recognizes trusteeship without noting it on the register. The donors had no intention of gifting land to the 1st Defendant. The Defendants, as trustees, must transfer the plots to the Plaintiffs.

p. 9

Legal principles established

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  • A party who contributes to the purchase of land is entitled to a share proportionate to his contribution notwithstanding non-registration
  • Registration of land purchased with another's money gives rise to a resulting trust in favour of the person whose funds were used
  • Facts not traversed in pleadings are deemed admitted under Order 2 Rule 11(1) of the Civil Procedure Rules

Court orders

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  1. 1.The 1st Defendant and Denise Knot Mtile ordered to sign transfer documents within seven (7) days transferring Kilifi/Kibokoni/Block M 13D/113 and Kilifi/Kibokoni/Block M/13D/114 to the Plaintiffs
  2. 2.The Deputy Registrar of the court to sign the transfer documents in the event the 1st Defendant and Denise Knot Mutile decline, and the District Land Registrar to effect the transfer and issue Title Deeds to the Plaintiffs
  3. 3.Permanent injunction restraining the 1st Defendant, his agents, servants or nominees from trespassing on or interfering with the day-to-day running of the institutions on Kilifi/Kibokoni/BM/13D/113 and 114
  4. 4.The 1st Defendant to pay the Plaintiffs the costs of the suit

Authorities

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Legislation

  • Civil Procedure RulesOrder 2 Rule 11(1)
  • Registered Land ActSection 28

Cases cited (4)

  • Hussey Vs Palmer
    (1972) ALLER
  • Stephene Mkare Mulewa Vs Linda Newman
    Malindi Civil Appeal No. 32 of 2013
  • Gissing Vs Gissing
    (1970) 2ALLER 780
  • Hamm Helmut Vs Farida Riziki
    (2011) e KLR
Jurisdiction invoked
Original civil jurisdiction; suit transferred from the Chief Magistrate's Court by consent on 4th March 2014

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Francis K. Baya & 2 others v Sammy Mutile & another [2015] KEELC 461 (KLR)", Case Analysis (2015). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2015/461/eng@2015-06-12

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