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ELCAllowedOriginating Summons No 394 of 2017· [2017] KEELC 1023 (KLR)

In re P M K & 2 others [2017] KEELC 1023 (KLR)

Environment and Land Court
17 November 2017
2,127 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan trustee who wants to sell family land held for children must first get court approval, which courts grant if children benefit.

What this practically means

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Executive summary

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By an Originating Summons dated 27th March 2017 brought under Order 37 Rule 1 of the Civil Procedure Rules 2010, P M K, the registered owner of Ruiru/Ruiru East Block 7/[particulars withheld], sought the court's approval to dispose of the suit parcel. She held the land as trustee for herself and her two children, W N N (then aged 19, a university student) and C W G N (a minor). She proposed to sell the land for Kshs.800,000/= to Monica Waitherero Wanjiru, apply part of the proceeds to W N N's university fees, purchase an alternative parcel in Kajiado/Kipeto for Kshs.400,000/= to be registered jointly in her and W N N's names to hold in trust for the minor, and place the balance in an interest-earning account. W N N swore a supporting affidavit consenting to the sale, stating she was not unduly influenced. The court, per L. Gacheru J, held that as trustee the Applicant could not sell the trust land without court approval but had locus standi to bring the summons. Relying on Sections 13, 17(1) and 56 of the Trustees Act, the court found the application merited and allowed the sale, directing the application of proceeds to the children's education, the purchase of the replacement land to continue the trust, and the deposit of the balance in an interest-earning fund. Judgment was delivered at Thika on 17th November 2017. No costs order was recorded.

Key legal issues

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01

Locus standi of a trustee to seek court approval for sale of trust property

Holding

The Applicant, being the registered owner and trustee of the suit property, has locus standi to bring the Originating Summons.

Reasoning

The official search dated 14th April 2010 showed the Applicant holding the land as trustee for herself and her two children. Because a trustee cannot dispose of trust land without court approval, the Applicant had a legitimate interest requiring judicial sanction, which conferred standing to bring the summons under Order 37 Rule 1.

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02

Court's discretion under Section 56 of the Trustees Act to authorise dealings with trust property

Holding

The court has discretion under Section 56 of the Trustees Act to allow a disposition of trust property where it is expedient but cannot be effected for absence of power, and may impose terms and conditions.

Reasoning

The court considered Section 17(1) allowing trustees to raise capital money by sale of trust property, and Section 56 which grants discretion to permit transactions otherwise outside the trustees' powers. Combined with Order 37 Rule 1, which permits approval of a sale, purchase, compromise or other transaction, the Applicant's proposed sale for the benefit of the beneficiaries fell squarely within the court's power to sanction.

p. 3
03

Whether the intended sale was for the benefit of the trust beneficiaries

Holding

The court was satisfied that the Applicant intended to utilise the sale proceeds well and for the benefit of the children named in the certificate of title, and that the adult beneficiary W N N had consented without coercion.

Reasoning

W N N, now an adult, swore a supporting affidavit confirming she was informed of the sale, had no objection, and was not unduly influenced. The sale agreements for the suit property and the proposed Kajiado/Kipeto purchase were before the court, and the proposed continuation of the trust over the replacement parcel assured protection of the minor beneficiary's interest.

p. 3

Legal principles established

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  • A registered owner holding land as a trustee cannot sell the trust property without the approval of the court.

Court orders

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  1. 1.Allowed the Exparte Applicant to sell land parcel No. Ruiru/Ruiru East Block 7/[particulars withheld]
  2. 2.Directed that proceeds be applied to payment of school fees towards University Education of her daughter W N N
  3. 3.Directed payment of school fees for the second child who is a minor, C W G N
  4. 4.Directed purchase of land parcel No. Kajiado/Kipeto/[particulars withheld] to be registered in the name of the Applicant and W N N to hold in trust for C W G N
  5. 5.Directed establishment of an interest earning fund and deposit of the remainder of the balance of the purchase price to secure the children's school fees and upkeep

Authorities

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Legislation

  • Trustees ActSection 13
  • Trustees ActSection 17(1)
  • Trustees ActSection 56
  • Civil Procedure Rules 2010Order 37 Rule 1
Jurisdiction invoked
Order 37 Rule 1 of the Civil Procedure Rules 2010; Sections 17(1) and 56 of the Trustees Act

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, "In re P M K & 2 others [2017] KEELC 1023 (KLR)", Case Analysis (2017). Originating Summons No 394 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2017/1023/eng@2017-11-17

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