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ELCAllowedNot stated in judgment (plaint filed 25 March 2018)· [2018] KEELC 2943 (KLR)

James Mogunde Mogunde (Suing on behalf of and as Donee of Power of Attorney from Edward Sakawa Nyasaka) v Faulu Micro Finance Bank Limited [2018] KEELC 2943 (KLR)

Environment & Land Court
8 May 2018
MSMunyao Sila
1,283 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~5 min to read original · ~4 min brief

The bottom line

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A Nakuru court blocked the sale of a man's land after proving he was abroad when a Kshs 10 million charge was fraudulently registered against it.

What this practically means

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Executive summary

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The plaintiff, a resident of the USA suing through his attorney James Mogunde Mogunde, is the registered owner of land parcel Kiambogo/Kiambogo Block 2/15863, purchased in November 2006, on which he built 16 two-bedroom family units valued at about Kshs. 30,000,000/=. In October 2017 strangers came to value the property, and a search revealed a charge of Kshs. 10,000,000/= registered in favour of the defendant with one Esther Njeri Ngigi as borrower and the plaintiff as chargor. The plaintiff pleaded the charge was fraudulently registered on forged documents, since he was out of the country between 13 January 2017 and later dates and could not have signed the charge dated 31 March 2017. The original title deed remained with his attorney. An auctioneer dropped a 45-day redemption notice in March 2018. The plaintiff sought declarations that the charge was fraudulent and illegal, discharge and restoration of the register, an order that the intended sale is unlawful, a permanent injunction, general damages and costs. Together with the plaint he filed an interlocutory application for an injunction pending the hearing of the suit. The defendant was served but entered no appearance and filed nothing. Applying the Giella vs Cassman Brown principles, the court found the passport evidence established a prima facie case with a probability of success, that a sale would cause irreparable loss, and that the balance of convenience favoured maintaining the suit property. The application was allowed with costs to the plaintiff, with an injunction and an order of inhibition issued pending the hearing and determination of the suit.

Key legal issues

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01

Whether a prima facie case was established against the allegedly fraudulent charge

Holding

Yes. The plaintiff showed by passport evidence that he was out of the country when the charge was executed, making it probable the charge instrument is a forgery.

Reasoning

The plaintiff's passport showed he flew out on 13 January 2017, before the charge dated 31 March 2017, so he could not have signed it. The addresses on the charge were not his and the ID photograph was not of him. The original title remained with the plaintiff's attorney. The defendant entered no appearance, so the uncontroverted material satisfied the first Giella criterion, warranting the injunction and inhibition.

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02

Whether irreparable loss and the balance of convenience favoured the injunction

Holding

Yes. A sale in exercise of the statutory power of sale would cause irreparable loss, and in any event the balance of convenience lies in maintaining the suit property.

Reasoning

If the defendant exercised its statutory power of sale over property the plaintiff says he never charged, the loss would be irreparable. The court stated it was not in doubt, but even if it were, the balance of convenience favours preserving the suit property until the suit is heard and determined, supporting both the injunction and the order of inhibition.

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Legal principles established

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  • To succeed in an application for injunction, the applicant must display a prima facie case with a probability of success, demonstrate irreparable loss, and where the court is in doubt, the application is determined on a balance of convenience (Giella vs Cassman Brown).

Court orders

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  1. 1.Order of injunction restraining the defendant from offering for sale, selling, further charging, leasing, taking over, or in any other way dealing or entering into any dispositions over the land parcel Kiambogo/Kiambogo Block 2/15863 (Mwariki) pending hearing and determination of the suit
  2. 2.Order of inhibition restricting the registration of any disposition in the register of the land parcel Kiambogo/Kiambogo Block 2/15863 (Mwariki) pending hearing and determination of the suit
  3. 3.Costs of the application to the plaintiff

Authorities

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Cases cited (1)

  • Giella vs Cassman Brown
    (1973) EA 358
Jurisdiction invoked
Original civil jurisdiction of the Environment and Land Court over the land parcel Kiambogo/Kiambogo Block 2/15863; specific provision not stated

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, "James Mogunde Mogunde (Suing on behalf of and as Donee of Power of Attorney from Edward Sakawa Nyasaka) v Faulu Micro Finance Bank Limited [2018] KEELC 2943 (KLR)", Case Analysis (2018). Not stated in judgment (plaint filed 25 March 2018). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2018/2943/eng@2018-05-08

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