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ELCDismissedNot stated in the judgment· [2016] KEELC 979 (KLR)

George Ted Osewe Odero & 3 others v Pauline Adhiambo Raget & 5 others [2016] KEELC 979 (KLR)

Environment and Land Court
13 April 2016
SKS.M. Kibunja
2,955 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court dismissed land buyers' bid to stop a property transfer, confirming that rescinded contracts and registered titles defeat injunction claims.

What this practically means

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Executive summary

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The Plaintiffs, suing as office bearers of Lakeland Welfare Club, moved the Environment and Land Court by notice of motion dated 3rd February 2015 seeking an injunction and inhibition over Kisumu/Fortternan/516 pending hearing, and alternatively an injunction over Kisumu/Fortternan/1129 and transfer to court of Kshs.4,905,000 deposited by the 1st Defendant. They alleged they had purchased parcels 516 and 518 from the 1st Defendant, paid the full purchase price of Kshs.4,950,000 and taken possession, only for the 1st Defendant to transfer the parcels to the 2nd and 3rd Defendants, who were consolidating titles and charging them to the 6th Defendant. The 1st Defendant countered that the Plaintiffs breached the 29th September 2010 sale agreement by failing to complete payment within 90 days, whereupon she rescinded the contract and refunded Kshs.4,905,000. The 2nd and 3rd Defendants asserted they bought for value after due diligence, and the 6th Defendant opposed on the grounds that rescission destroyed any prima facie case and damages would suffice. Applying the Giella v Cassman Brown principles, the court held the 1st Defendant remained the registered proprietor capable of passing good title notwithstanding rescission; that no evidence showed her registration was procured illegally, unprocedurally or through a corrupt scheme so as to impeach the third parties' titles under Section 26(1)(b) of the Land Registration Act; and that any claim was adequately compensable in damages. The motion was dismissed with costs and the interim orders vacated on 13th April 2016.

Key legal issues

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01

Prima facie case for interlocutory injunction

Holding

The Plaintiffs failed to establish a prima facie case with a probability of success because their sale contract had been rescinded and they showed no basis to defeat the registered titles

Reasoning

The court found the 1st Defendant was the registered proprietor and retained capacity to transfer good title notwithstanding rescission of the sale agreement with the Plaintiffs. The Plaintiffs' payments were made after the contractual 90-day completion period, and the court held it could not pronounce finally on contested facts at the interlocutory stage. The claim, if successful, was adequately addressed by damages, and the balance of convenience favoured maintaining the status quo.

p. 5
02

Impeachability of third-party titles under Section 26(1)(b) Land Registration Act

Holding

The 2nd and 3rd Defendants' titles were not impeachable as no evidence showed the 1st Defendant procured registration illegally, unprocedurally or through a corrupt scheme

Reasoning

The Plaintiffs relied on authority that titles acquired illegally or through corrupt schemes are impeachable even against innocent purchasers. However, the court found no evidence of fraud or forgery in the 1st Defendant's obtaining of a provisional title for parcel 516 and her subsequent transfer to the 2nd and 3rd Defendants, who carried out due diligence and obtained Land Control Board consent. The Plaintiffs offered no evidence to the contrary.

p. 5

Legal principles established

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  • A registered proprietor is the absolute and indefeasible owner of land until successfully challenged under Section 26(1)(a) or (b) of the Land Registration Act
  • Where a rescinded contract is the basis of the claim, the court may find damages an adequate remedy and the balance of convenience may favour maintaining the status quo

Court orders

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  1. 1.The Plaintiffs' notice of motion dated 3rd February 2015 is dismissed with costs
  2. 2.The interim orders are vacated

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 159(2)(d); Article 40
  • Civil Procedure ActSections 1A, 1B and 3A
  • Civil Procedure RulesOrder 40 Rules 1 and 2
  • Environment and Land Court ActSections 3 and 13
  • Land Registration Act No. 3 of 2012Sections 26(1), 26(1)(a), 26(1)(b) and 76

Cases cited (18)

  • Giella -v- Cassman Brown & Co. Ltd
    (1973) E.A 358
  • Suleiman -v- Amboseli Resort Ltd
    2004 2 KLR 289
  • Elijah Makori Nyangwira -v- Stephen Mugai Njuguna & another
    (2003) eKLR
  • Paskal Ouma Mudaki & 3 others -v- Habil Ndisi & 10 others
    [2014] eKLR
  • Esther Ndegi Njiru & Another -v- Leonard Gateri
    (2004) eKLR
  • Kenya Industrial Estate Ltd -v- Ann Chepsiter & 5 others
    (2015) eKLR
  • Kenya Anti-Corruption Commission -v- Ahmed Karama said & 2 others
  • Alberta Mao Gachie -v- 4 others
    (2006) eKLR
  • Mohamed -v- Commissioner of Land & 4 Others
    KLR
  • Purity Wanjiku Nderitu & Another -v- Humphrey Wangombe Kahariri & Another
    2013
  • Jai Super Power Cash & Carry Ltd -v- Nairobi County Council
    Civil Appeal No.111 of 2002
  • Juddy Matetai -v- James Charo
    [2015] eKLR
  • Leonard Nzioka Mweke – Edward Mutula & 2 others
    [2015] eKLR
  • Mrao Ltd -v- First American Bank of Kenya & 2 others
    (2003) KLR 123
  • Mitimitu M'mwitithirwa -v- Diocese of Meru & Another
    (2009) eKLR
  • R.G. Patel -v- Lalji Makanji
    (1957) E A
  • Lucy Wangari Njogu -v- Peter Leonard Mwangi & Another
    [2012] eKLR
  • Chatur Radio Services – v- Phonogram Ltd
    [1994] KLR 114
Jurisdiction invoked
Sections 3 and 13 of the Environment and Land Court Act; Article 159(2)(d) of the Constitution

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, "George Ted Osewe Odero & 3 others v Pauline Adhiambo Raget & 5 others [2016] KEELC 979 (KLR)", Case Analysis (2016). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2016/979/eng@2016-04-13

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