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ELCDismissed· [2018] KEELC 4755 (KLR)

Patrick Gitonga Muguku v Gilbert Maina Ngei & 3 others [2018] KEELC 4755 (KLR)

Environment and Land Court
25 January 2018
COChristine Ochieng
1,856 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court refused to preserve land a buyer partly paid for, because it had been validly resold to an innocent purchaser; his remedy is a refund, not the land itself.

What this practically means

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Executive summary

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The Plaintiff moved the court by Notice of Motion dated 1st September 2017 seeking injunctive orders preserving land parcel LR NGONG/NTASHART/5033, carved out of LR NGONG/NGONG/755, pending the hearing of the main suit. He had contracted on 19th December 2011 to purchase 28.33 hectares from the 1st to 3rd Defendants for Kshs 13,000,000, paying Kshs 10,680,000, with the balance payable upon subdivision and issuance of title. The vendors rescinded the agreement by notice dated 25th November 2014 for non-payment, and sold the entire parcel to the 4th Defendant for Kshs 48,650,000, with registration on 12th September 2017. The vendors argued the agreement stood rescinded, the Plaintiff's remedy was a refund less Kshs 1,320,000 liquidated damages, and the transaction lacked Land Control Board consent. The 4th Defendant asserted it conducted due diligence, found no adverse interest, took possession, subdivided the land, and held indefeasible title as a bona fide purchaser for value without notice. Applying the Giella v Cassman Brown principles, the court held the Plaintiff failed to demonstrate a prima facie case because the suit land no longer existed, having been transferred to the 4th Defendant whose title is protected by sections 24(a) and 25 of the Land Registration Act. The Plaintiff could also be adequately compensated in damages. The application was dismissed with costs in the cause, the court indicating the Plaintiff's remedy is to sue the 1st to 3rd Defendants for a refund of the purchase price.

Key legal issues

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01

Whether the Plaintiff established a prima facie case with probability of success

Holding

No prima facie case established as the suit land had been sold to and registered in favour of the 4th Defendant, a purchaser for value

Reasoning

The agreement of 19th December 2011 was validly rescinded after the Plaintiff defaulted on payment, following the contractual notice procedure. The vendors sold the whole parcel to the 4th Defendant for Kshs 48,650,000 and title issued on 12th September 2017. The 4th Defendant's title is protected by sections 24(a) and 25 of the Land Registration Act, so the Plaintiff's remedy lies in a refund of the purchase price.

p. 3
02

Whether the Plaintiff would suffer irreparable loss not compensable by damages

Holding

No, damages are adequate compensation because the suit property no longer exists

Reasoning

The court found the suit land had been subdivided and fresh titles issued to third parties, so an injunction could not restore the position. Since the vendor defendants can compensate the Plaintiff monetarily for the purchase price paid, damages are an adequate remedy and the second Giella ground also fails.

p. 4

Legal principles established

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  • A registered proprietor's title is protected under sections 24(a) and 25 of the Land Registration Act and cannot be defeated except as provided in the Act
  • Where a purchaser's suit property has been validly transferred to an innocent purchaser for value, the remedy is a refund of the purchase price, not injunctive relief

Court orders

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  1. 1.The Plaintiff's Notice of Motion dated 1st September 2017 is dismissed
  2. 2.Costs in the cause

Authorities

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Legislation

  • High Court Vacation RulesRule 3(2)
  • Civil Procedure RulesOrder 37
  • Land Registration ActSections 24(a) and 25

Cases cited (1)

  • Giella Vs. Cassman Brown & Co. Ltd
    (1973) EA 358
Jurisdiction invoked
High Court Vacation Rules Rule 3(2) and Order 37 of the Civil Procedure Rules

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, "Patrick Gitonga Muguku v Gilbert Maina Ngei & 3 others [2018] KEELC 4755 (KLR)", Case Analysis (2018). . Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2018/4755/eng@2018-01-25

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