Majestic Security Systems Limited v Magnate Ventures Limited & 4 others [2020] KEELC 345 (KLR)
The bottom line
#A Nairobi land court froze all dealings with a disputed Nairobi property and refused to throw out either side's case, meaning ownership will be decided at a full trial.
What this practically means
#Executive summary
#Key legal issues
#Whether the Preliminary Objection raised a pure point of law
Grounds 1, 2 and 4 failed the Mukisa Biscuit test as they required ascertainment of facts; res judicata also failed as the JR case did not decide ownership of the suit property
The court applied the Mukisa Biscuit definition and held that grounds requiring factual ascertainment cannot ground a preliminary objection. On res judicata, the High Court in JR No. 424 of 2016 only dealt with the NLC's jurisdiction over ownership disputes between private entities, and left ownership of the suit property to the Environment and Land Court, so the issues in this suit were not previously decided.
Whether a temporary injunction should issue over the suit property
Injunction as prayed refused; status quo to be maintained pending hearing and determination
The suit property is registered in and possessed by the 1st Defendant, but there are serious contested facts as to how ownership passed from the Plaintiff via the 2nd and 3rd Defendants' alleged fraudulent directorship and power of attorney. With such contested facts, the court limited itself to preserving the status quo: no development, sale, charging or alteration of the property's character until determination.
Whether the defences and counterclaims should be struck out
Application dismissed; defences and counterclaims raise triable issues
Striking out of pleadings should be done sparingly. This is contested litigation over how property changed ownership, with allegations of fraudulent directorship. The 1st Defendant's defence and counterclaim against the Land Registrar are not hopeless; the fact that the Plaintiff cannot answer a counterclaim not directed at it is no ground for striking it out. The 2nd and 3rd Defendants' counterclaim for restoration as directors is likewise meritorious.
Whether the Plaintiff's suit should be struck out for want of capacity, board resolution and instructions
Application dismissed with no order as to costs
The suit is not hopeless; weighty issues fall for determination. The Plaintiff demonstrated a board resolution authorizing the suit and the advocate demonstrated by affidavit that he had instructions, defeating the claims of backdating and lack of authority.
Legal principles established
#- A preliminary objection must raise a pure point of law and cannot be raised where facts must be ascertained or judicial discretion exercised
- A party cannot compel another to seek a relief against it where such relief cannot properly be directed at it
Court orders
#- 1.The Preliminary Objection by the 2nd and 3rd Defendants is dismissed with costs to the Plaintiff
- 2.An order of maintenance of status quo granted in respect of the Notice of Motion dated 3rd May 2018: the 1st Defendant remains in possession of L.R. No. 21069; no development, sale, charging or any act altering the status of the suit property by any party until hearing and determination of the suit
- 3.Costs of the Notice of Motion dated 3rd May 2018 shall be costs in the cause
- 4.The Notice of Motion dated 22nd October 2018 is dismissed with costs to the 1st, 2nd and 3rd Defendants
- 5.The Notice of Motion dated 13th March 2019 is dismissed with no order as to costs
- Jurisdiction invoked
- Environment and Land Court jurisdiction over ownership of the suit property (issue left to the ELC by the High Court in JR No. 424 of 2016)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Majestic Security Systems Limited v Magnate Ventures Limited & 4 others [2020] KEELC 345 (KLR)", Case Analysis (2020). (not stated in extract). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2020/345/eng@2020-11-11
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.