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ELCPartially AllowedELC Case No. 204 of 2017 (formerly Machakos HCCC No. 243 of 2012)· [2018] KEELC 3934 (KLR)

Peter Njoroge Ng’ang’a v Kenya Reinsurance Corporation Limited (Statutory Manager for United Insurance Company) & another [2018] KEELC 3934 (KLR)

Environment and Land Court
5 March 2018
6,370 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~25 min to read original · ~4 min brief

The bottom line

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A Kenyan court cancelled a land buyer's title because his seller had no valid title to give, even though the buyer was innocent.

What this practically means

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Executive summary

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The Plaintiff sued the Kenya Reinsurance Corporation Limited (statutory manager for United Insurance Company Limited) and United Insurance Company Limited, seeking a permanent injunction against interference with, and aggravated damages over, land parcel Kajiado/Kaputiei-North/4243, which he bought in 2011 from Martin Karumba Koiyet for Kshs. 21.5 million. The Defendants filed a joint defence and counterclaim seeking declarations that the Plaintiff's title was null and void, cancellation of his title deed, rectification of the register, an injunction and damages. The Plaintiff pleaded due diligence, an official search showing Koiyet as proprietor, full payment through Co-operative Bank financing, Land Control Board consent and registration in 2012. The court framed four issues: legitimate proprietorship, entitlement to the prayers in the Plaint and counterclaim, and costs. Evidence showed United Insurance held a 1999 title captured in the Presentation Book, while the 2011 reissuance of a title to Koiyet was unrecorded, unsupported by any gazette notice or statutory declaration, and marred by collusion with the then Land Registrar, Koskei. The court found Koiyet, having already transferred the land to United Insurance and never refunded the monies, was a fraudster with no good title to pass. Although the Plaintiff was innocent of fraud, his derivative title was unprotected under section 26(1) of the Land Registration Act. The Plaintiff's suit was dismissed. The counterclaim succeeded save that aggravated damages were refused for want of proof of loss. Declarations issued vesting ownership in United Insurance, the Plaintiff's title was nullified, rectification and a permanent injunction were ordered, and costs were awarded to the Defendants. The Plaintiff was left to seek remedies from Koiyet.

Key legal issues

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01

Legitimate proprietorship of suit land LR No. Kajiado/Kaputiei-North/4243

Holding

United Insurance Company Limited, registered in 1999 with a title captured in the Presentation Book, is the legitimate holder; the reissued title to PW1 and the derivative title to the Plaintiff were invalid.

Reasoning

Both parties held titles over the same parcel. The reissuance of the title to PW1 in 2011 was not captured in the Presentation Book, no gazette notice or statutory declaration was produced, and the court found collusion between PW1 and the then Land Registrar Koskei. PW1 had already transferred the land to the 1st Defendant in 1999 and no cancellation of that title was proved. PW1 therefore had no good title to pass to the Plaintiff.

p. 5
02

Whether the Plaintiff's registered title is protected under section 26(1) of the Land Registration Act

Holding

The Plaintiff's title is not protected because it derives from a vendor without good title, notwithstanding that the Plaintiff was not party to the fraud.

Reasoning

Relying on section 26(1) and the Alice Chemutai Too authority, the court held that where title is impeached on the ground of illegality or unprocedural acquisition it is unnecessary to prove the title holder's complicity in fraud. Since PW1 lacked good title and the 1st Defendant's title was never cancelled, the Plaintiff's derivative title could not stand. The court distinguished the protection of an innocent purchaser from the root-of-title defect.

p. 6
03

Entitlement to relief under the Plaint and counterclaim

Holding

The Plaintiff's suit fails entirely; the counterclaim succeeds except for aggravated damages, which were unproved.

Reasoning

Having found the 1st Defendant the legitimate owner, the Plaintiff could not obtain an injunction or damages and was directed to seek remedies from PW1. The Defendants were entitled to the declarations, rectification and injunction sought. However, no evidence of loss was canvassed to justify aggravated damages despite the Plaintiff's undertaking as to damages, so none was awarded.

p. 7

Legal principles established

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  • A title procured from a vendor who had no good title to pass is not protected by section 26(1) of the Land Registration Act even where the purchaser was innocent of fraud
  • A vendor who sells land twice, holding on to monies paid and concealing prior dealings, is a fraudster whose derivative title cannot stand

Court orders

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  1. 1.The Plaintiff's suit be and is hereby dismissed.
  2. 2.A declaration be and is hereby issued that United Insurance Company Limited is the legal owner of Land Parcel Title No. KAJIADO/KAPUTIEI NORTH/4243
  3. 3.A declaration be and is hereby issued that the transfer of the title deed over all that piece of land known as LR Number Kajiado/Kaputiei – North/4243 to the Plaintiff is invalid, null and void ab initio.
  4. 4.The Land Registrar Kajiado be and is hereby directed to recall, revoke, cancel and or nullify the Title Deed issued to Peter Nganga Njoroge on the 14th March, 2012 for land parcel number Kajiado/Kaputiei – North/4243.
  5. 5.The Land Registrar Kajiado be and is hereby directed to rectify the records and or register at the Lands Registry, Kajiado and or any such successor land registry so as to reflect and/or read United Insurance Company Limited as the registered proprietor of Land Parcel Number Kajiado/Kaputiei – North/4243.
  6. 6.A permanent injunction is hereby issued restraining the Plaintiff by himself, servants, agents employees and or any other person howsoever from trespassing, encroaching onto, remaining on and or in any other way whatsoever interfering with all that parcel of land known as LR Number, Kajiado/Kaputiei – North/4243.
  7. 7.The costs of the suit are awarded to the 1st and 2nd Defendants.

Authorities

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Legislation

  • Land Registration ActSection 33
  • Land Registration ActSection 26(1)
  • Land Registration ActSection 80(2)

Cases cited (6)

  • Arthi Highway Developers Limited Vs West End Butchery Limited & 6 others
    Civil Appeal No. 246 of 2013
  • Esther Ndegi Njiru & 2 Another Vs. Leonard Gatei
    ELC Civil Suit No. 128 of 2011
  • Lawrence Mukiri Vs Attorney General & 4 others
    ELC Suit No. 169 of 2008
  • Alice Chemutai Too Vs Nickson Kipkurui Korir & 2 others
    [2015] eKLR; ELC Civil Suit No. 51 of 2014 (O.S)
  • Agnes Naipanoi Pasha Vs Stephen K. Wangombe & 2 others
    High Court Civil Suit No. 123 of 2011
  • Elijah Makeri Nyangwara vs Stephen Mungai Njuguna & Another
    ELC Case No. 609 B of 2012
Jurisdiction invoked
Original jurisdiction of the Environment and Land Court under Article 162(2) of the Constitution and the Environment and Land Court 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, "Peter Njoroge Ng’ang’a v Kenya Reinsurance Corporation Limited (Statutory Manager for United Insurance Company) & another [2018] KEELC 3934 (KLR)", Case Analysis (2018). ELC Case No. 204 of 2017 (formerly Machakos HCCC No. 243 of 2012). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2018/3934/eng@2018-03-05

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