Nairobi City Council v Jeremiah O. Eshitemi & another [2018] KEELC 3649 (KLR)
The bottom line
#Nairobi City Council lost its appeal because defective court service meant the auction buyer never got valid title and must be refunded.
What this practically means
#Executive summary
#Key legal issues
#Properness of service of summons under the Rating Act
Service by affixing must be on a conspicuous part of the rateable property; affixing on an outer door of a multi-unit premises without showing it was conspicuous to the defendant is not proper service.
Section 17(4) of the Rating Act permits service by post, by affixing on some conspicuous part of the land, or by any mode authorised by the Civil Procedure Rules. The return of service by Michael Kiganya showed affixing on the outer door of a house, but the premises had several units occupied by tenants, an averment not challenged, and it was not specified that the door chosen was conspicuous to the defendant. Process on an inconspicuous part is insufficient.
Compliance with preconditions to rates recovery proceedings
The rating authority must publish the Section 15 notice and serve a Section 17 demand before instituting proceedings; the Appellant attached no evidence of the Section 15 notice or of service of the demand.
Section 15 requires at least 30 days' notice of rates payable; Section 16 makes payment a duty after that notice; Section 17(2) permits proceedings only where a demand has been served on the defaulter. The certificate of assessment alone was insufficient because the Appellant did not annex evidence of service of the notice contemplated by Section 15 or prove service of the demand under Section 17 before filing suit.
Whether good title passed to the auction purchaser
No good title passed to the 2nd Respondent because the decree was founded on proceedings without proper service; Section 26 protection of the Land Registration Act does not apply where title is acquired illegally, unprocedurally or through a corrupt scheme.
The auction flowed from a decree in proceedings where service was defective. The 2nd Respondent's reliance on Captain Patrick Kanyagia was distinguished because that case concerned a mortgagee's power of sale, not rates recovery under the Rating Act. A title flowing from defective proceedings cannot attract indefeasibility under Section 26 of the Land Registration Act.
Reimbursement of the auction purchaser
The 2nd Respondent is entitled to reimbursement of the purchase price with interest at court rates from the date of payment, but only upon proving it paid the full Kshs. 500,000, as it was unclear whether the balance beyond the Kshs. 125,000 deposit was paid.
The memorandum of sale shows a purchase price of Kshs. 500,000 with a deposit of Kshs. 125,000. It is not clear whether the balance was paid or whether the Appellant refunded any surplus to the 1st Respondent. Under Order 42 Rule 32 the appellate court may pass any decree which ought to have been made, and it would be unconscionable for the Appellant to retain the sale proceeds without restoring the purchase price.
Legal principles established
#- Where the mode of service by affixing is chosen under Section 17(4) of the Rating Act, the summons must be affixed on some conspicuous part of the land; affixing on an inconspicuous part is improper service
- A rating authority must serve a demand under Section 17 before taking proceedings to recover rates, and must show the notice under Section 15 preceded liability
- Title acquired through proceedings conducted without proper service is not protected by the indefeasibility provisions of the Land Registration Act
Court orders
#- 1.Appeal dismissed
- 2.Appellant to reimburse the 2nd Respondent the purchase price paid for the Suit Property at the auction together with interest at court rates from the date of payment until payment in full, subject to the 2nd Respondent proving payment of the full Kshs. 500,000
- 3.Appellant to pay costs of the appeal to the 2nd Respondent
- On appeal from
- Chief Magistrate's Court (RMCC No. 131 of 1990 ruling)
- Civil Appeal No. 402 of 2002
- Jurisdiction invoked
- Appellate jurisdiction under Order 42 of the Civil Procedure Rules over Civil Appeal No. 402 of 2002, transferred to the Environment and Land Court as ELC Case No. 538 of 2017
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Nairobi City Council v Jeremiah O. Eshitemi & another [2018] KEELC 3649 (KLR)", Case Analysis (2018). E.L.C. Case No. 538 of 2017 (Formerly Civil Appeal No. 402 of 2002). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2018/3649/eng@2018-04-12
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.