Lakeview Development Limited v Belgo Holdings Limited & another [2021] KEELC 213 (KLR)
The bottom line
#A Nairobi land court froze two disputed properties pending trial and refused to pause the case while an appeal runs, citing the need for expeditious justice.
What this practically means
#Executive summary
#Key legal issues
#Prima facie case with a chance of success
The Plaintiff established a prima facie case with overwhelming chances of success
The sale agreement of 29 May 1995 and non-payment of the Kshs. 20 million consideration were in serious dispute; the 1st Defendant's own pleading that no Land Control Board consent was applied for under Sections 6 and 8 of the Land Control Act raised a triable legality issue; the plea of implied, resulting and constructive trust raised further triable issues. Res judicata and limitation objections were unavailable, having been dealt with in the Ruling of 10th May 2021 by a court of concurrent jurisdiction. The court, on an interlocutory application, made no final findings of fact.
Irreparable loss
Irreparable loss was proven since the registered 1st Defendant could alienate or charge the suit properties, destroying the substratum of the suit
Sections 24 and 25 of the Land Registration Act, 2012 vest absolute ownership in the registered proprietor, enabling alienation. Any sale, alienation or charge would substantially destroy the foundation of the suit, and such loss could not adequately be compensated in damages.
Balance of convenience
The balance of convenience tilts in favour of the Plaintiff, as preservation of the suit properties serves both parties and the doctrine of lis pendens favours conservation of the substratum of the dispute
Both parties rival claims over the properties; preserving them ensures the ultimate winner takes the properties without auxiliary proceedings. Lis pendens, applicable upon active prosecution, goes hand in hand with the balance of convenience.
Stay of proceedings pending appeal
Sufficient cause was shown for a stay of proceedings, as filing a Notice of Appeal suffices to constitute an appeal under Order 42 Rule 6(4) of the Civil Procedure Rules
Applying the Ringera J test in Re Global Tours & Travel Ltd, stay of proceedings is a discretionary remedy exercised in the interest of justice. The pendency of Civil Appeal E345 of 2021 against the Ruling of 10th May 2021, in which striking out of the suit was dismissed, constituted sufficient cause.
Nugatory appeal test
The 1st Defendant's appeal would not be rendered nugatory if stay of proceedings were not granted; accordingly the stay application was dismissed
If the appeal succeeds, the suit will stand struck out at whatever stage of hearing, and costs can be remedied by the Court of Appeal. Granting stay would hold the subject matter in abeyance and defeat Article 159(2)(b) of the Constitution on expeditious disposal.
Legal principles established
#- A Torrens/RLA title is defeasible on proof of mistake, misrepresentation, fraud, illegality or total failure of consideration; indefeasibility is not established by merely waving a title document
- Parties are bound by their pleadings; a court cannot adjudicate on claims or defences not raised by the parties
- A constructive trust relating to land subject to the Land Control Act is enforceable
- In interlocutory applications the court must not make final findings of fact on disputed affidavits but weigh the relative strength of each side's propositions
- Definition of a prima facie case in civil applications
- Irreparable injury is injury that cannot adequately be compensated by damages; speculative injury will not suffice
- Lis pendens applies upon active prosecution of proceedings, not merely upon filing of suit
- For purposes of a stay of proceedings pending appeal, a Notice of Appeal suffices to constitute an appeal
- Stay of proceedings is a discretionary remedy exercised in the interest of justice, weighing expeditious disposal, arguability of the appeal and expeditiousness of the application
Court orders
#- 1.The Notice of Motion Application dated the 10th August 2020 (Plaintiff's application for temporary injunction) is merited and is allowed.
- 2.The Notice of Motion Application dated the 5th July 2021 (1st Defendant's application for stay of proceedings pending appeal) is devoid of merit and is dismissed.
- 3.Costs of the application dated 10th August 2020 shall abide the cause; costs of the application dated 5th July 2021 shall abide the appeal before the Court of Appeal.
- Jurisdiction invoked
- Original civil jurisdiction of the Environment and Land Court (interlocutory applications within a pending suit)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Lakeview Development Limited v Belgo Holdings Limited & another [2021] KEELC 213 (KLR)", Case Analysis (2021). Notice of Motion dated 10th August 2020 and Notice of Motion dated 5th July 2021 (ELC suit, Milimani). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2021/213/eng@2021-12-09
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.