Hadija Zuber Bakari v Rafiki Microfinance Bank Limited [2018] KEELC 3202 (KLR)

Environment and Land Court

30 May 2018

AOA. Omollo

779 words in judgment

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The bottom line

Once you fully repay a loan secured on your land, the Kenyan lender must hand back your title and sign the discharge — or pay your legal costs.

What this practically means

Executive summary

This was an undefended claim before the Environment and Land Court at Mombasa in which Hadija Zuber Bakari, the plaintiff, sought an order compelling Rafiki Microfinance Bank Limited, the defendant, to furnish documents enabling discharge of a charge dated 2nd December 2015 over plot number 4610/III/MN, title number CR 40945/1. The plaintiff had stood guarantor to Vitalis Mwangima, who obtained a loan of Kshs 1,000,000 from the defendant secured by her title. After the borrower defaulted, the plaintiff deposited Kshs 1,112,000 by two bankers' cheques with the defendant's advocates on 29th August 2016 in settlement of the loan, and also paid the bank's advocates' fee note of Kshs 80,000. Despite a promise to discharge the security, the defendant failed to release the title documents or execute the discharge of charge forms it had prepared. The defendant did not enter appearance, and the plaintiff's uncontroverted evidence comprised her written statement, the cheques, deposit slips, the charge document and the provisional title. Relying on the authorities cited by the plaintiff's counsel, the court found the claim proved on a balance of probabilities. It allowed the prayers in prayer (1) of the plaint for release of the title documents and related records, and awarded the plaintiff costs of the suit, holding she was justified in litigating after the defendant ignored her demand. Judgment was delivered at Mombasa on 30th May 2018 by A. Omollo, J.

Key legal issues

Entitlement to discharge of charge and release of title documents upon full settlement of the guaranteed debt

Holding

The plaintiff proved on a balance of probabilities that she settled the loan sum of Kshs 1,112,000 plus legal expenses of Kshs 80,000, and was entitled to the release of her title documents and a duly executed discharge of charge.

Reasoning

The claim proceeded undefended and the plaintiff's uncontroverted evidence showed the charge securing Kshs 1,000,000 advanced to Vitalis Mwangima Allen. Following demand, the plaintiff's advocate forwarded two bankers' cheques totalling Kshs 1,112,000 and later paid the bank's advocates' fee note of Kshs 80,000. The defendant prepared but did not execute the discharge of charge. Following the decisions in the Nancy Njoki Kinyanjui and Jane Wangui Kinuthia cases, the court held the plaintiff entitled to the prayers.

p. 2

Legal principles established

Where a plaintiff demonstrates that the guaranteed sum has been fully repaid, the bank is bound to release the title documents together with a duly executed discharge of charge.

Court orders

1.Allowed the plaintiff's prayers seeking release of her title documents as set out in prayer (1) of the plaint, including the discharge of charge, original provisional certificate of title, original deed plan, attorneys'/agents' certified ID and PIN copies, certified copy of the defendant's certificate of incorporation and PIN certificate
2.Costs of the suit to the plaintiff

Authorities

Cases cited (2)

Nancy Njoki Kinyanjui vs Equity Bank Ltd
(2017) eKLR
Jane Wangui Kinuthia vs Barclays Bank Ltd
(2007) eKLR

Jurisdiction invoked: Environment and Land Court jurisdiction over charges and title documents relating to land (original civil suit by plaint)

Key timeline

Practical implications

Frequently asked questions

Cite this brief

Caselaw, "Hadija Zuber Bakari v Rafiki Microfinance Bank Limited [2018] KEELC 3202 (KLR)", Case Analysis (2018). ELC Land Case No. 202 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2018/3202/eng@2018-05-30

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