Gordon Otieno Muna v Dennis Ongeso Ojany & 4 others [2021] KEELC 250 (KLR)
The bottom line
#Kenya's Environment and Land Court cancelled land transfers made over a registered caution, protecting a 1986 buyer's rights while refusing his late specific performance claim.
What this practically means
#Executive summary
#Key legal issues
#Validity of transfers effected while a caution was registered
The registration of the 1st, 2nd and 3rd respondents while the appellant's caution was registered was highly irregular, illegal, null and void.
Sections 71, 72 and 73 of the Land Registration Act protect a cautioner's registered interest. Section 72(2) bars registration of dispositions inconsistent with a caution except with the cautioner's consent or by court order. The green card showed no removal of the caution; the respondents argued the transfer flowed from a court order in the succession cause, but the court found the transactions effected while the caution was still registered and therefore void.
Limitation of actions
The suit was not statute barred because the cause of action arose on the fraudulent registrations of 27/6/2016 and 24/8/2016, and a fraud-based action carries a 3-year limitation period.
The trial magistrate had applied section 7 of the Limitation of Actions Act (12 years) from the 1986 agreement. On appeal, the court recharacterised the claim as one based on fraud and irregularity, holding the cause of action accrued upon registration of the respondents as owners in 2016. The suit filed on 3/8/2017 was within the 3-year period for fraud.
Innocent purchaser for value without notice
The 3rd respondent was not an innocent purchaser for value because the green card showed an existing, unremoved caution, which constituted notice.
Due diligence requires a purchaser to inspect the register. The green card revealed the caution on its face; failure to peruse it amounted to a failure of due diligence. The caution operated as notice of the appellant's interest, defeating the claim of title free of encumbrances.
Fraud by the respondents and the Land Registrar
Registering the property in the names of the 1st and 2nd respondents while the caution existed constituted fraud on the part of those respondents and the Land Registrar.
The court found the registrations were made despite the subsisting caution, with no evidence of its lawful removal. This amounted to fraud attributable to the 1st and 2nd respondents and the Land Registrar.
Constructive trust and proprietary estoppel
The appellant acquired rights and interests in the suit land attracting the equitable doctrines of constructive trust and proprietary estoppel.
The appellant established purchase from the deceased, payment of Kshs. 8,300/-, and possession and cultivation from the date of purchase, corroborated by PW2, a neighbouring landowner. The 1st and 2nd respondents never lived on or utilised the land, and their evidence on third-party occupation was unsupported as no such persons were called to testify.
Specific performance
Specific performance was not available because the relief was sought more than 30 years after the 1986 agreement, well beyond the 6-year period.
Although the appellant's equitable interest was recognised, the discretionary remedy of specific performance could not issue in respect of a 1986 agreement when sought in 2017. The appellant's remedy on that head was thus time-barred.
Legal principles established
#- A disposition inconsistent with a registered caution cannot be registered while the caution is in place except with the cautioner's consent or by court order.
- A registered caution constitutes notice to a prospective purchaser, who must peruse the register (green card) as part of due diligence.
- Time under section 7 of the Limitation of Actions Act in a claim founded on fraud runs from the registration giving rise to the fraudulent transaction, with a 3-year limitation period for fraud-based actions.
- A purchaser in possession who has paid the purchase price acquires rights protected by the equitable doctrines of constructive trust and proprietary estoppel.
Court orders
#- 1.Appeal allowed with costs.
- 2.Declaration that all entries in the register of land parcel KISUMU/KADERO-GOT NYABONDO/3556 entered after registration of a caution are null and void and are hereby cancelled.
- 3.Permanent injunction restraining the 1st, 2nd and 3rd respondents, their agents, employees or anybody acting on their behalf from trespassing upon parcel No. KISUMU/KADERO-GOT NYABONDO/3556, transferring or in any way alienating the land.
- 4.Costs of the appeal and costs in the lower court awarded to the appellant.
- On appeal from
- Principal Magistrate's Court, Kisumu
- Kisumu CMC ELC No. 138 of 2018
- Jurisdiction invoked
- First appellate jurisdiction of the Environment and Land Court over appeals from the magistrates' courts (appeal from Kisumu CMC ELC No. 138 of 2018)
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (1)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Chemitei v Yano & 2 others[2023] KEELC 16950 (KLR)20 Apr 2023applied
Cite this brief
#Cite this brief
Caselaw, "Gordon Otieno Muna v Dennis Ongeso Ojany & 4 others [2021] KEELC 250 (KLR)", Case Analysis (2021). ELCA Case No. 8 of 2019. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2021/250/eng@2021-12-17
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.