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ELCDismissedELC Case No. 454 of 2013· [2021] KEELC 2367 (KLR)

Kigwe Limited v Violet Wacuka Ngugi & 2 others; Susan Wanjiru Muriti (Interested Party) [2021] KEELC 2367 (KLR)

Environment and Land Court
22 July 2021
LKL. Komingoi
8,430 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~34 min to read original · ~4 min brief

The bottom line

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The court confirmed that a buyer who does proper due diligence keeps the land, and vague fraud allegations without hard evidence will fail.

What this practically means

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Executive summary

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Kigwe Limited sued for a permanent injunction, cancellation of entries and a declaration that it owns LR No 10823/13, alleging the 1st defendant, Violet Wacuka Ngugi, fraudulently transferred the land to herself in November 2012 and then to Muhasibu Housing Limited in January 2013, with the Attorney General's registry validating the fraud. Muhasibu Housing counterclaimed for a declaration of ownership as bona fide purchaser, a permanent injunction and mesne profits, having bought the land for Kshs. 95 million from the 1st defendant, then the registered proprietor. The interested party, Susan Wanjiru Muriti, supported the plaintiff, contending the 1st defendant lacked capacity and the 2nd defendant had notice of a CID complaint. The court framed six issues. It found PW1 David Waiganjo Kigwe failed to prove his signature on the transfer was forged, since no CID investigation report was produced and he admitted transferring properties to siblings. The 2nd defendant carried out due diligence, paid valuable consideration, obtained completion documents and took possession; the Land Registrar found no collusion or fraud. Applying the higher standard of proof for fraud, the court held the plaintiff failed to prove its case and dismissed the suit with costs. It held the 2nd defendant was a bona fide purchaser for value with an indefeasible title, allowed the counterclaim except the mesne profits prayer, on which no evidence of quantum was led, and entered judgment for the 2nd defendant with costs and interest.

Key legal issues

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01

Whether the transfer of the suit property to the 1st defendant was fraudulent

Holding

Not fraudulent; the transfer signed by PW1 as director was genuine and the plaintiff failed to prove forgery

Reasoning

PW1 denied signing the transfer and alleged forgery, reporting the matter to CID Kiambu, but produced no investigation report. His claim was therefore his word against the 1st defendant's. He admitted on cross-examination having transferred several properties to his siblings. Without corroborating evidence, forgery was not proved and the registration of 27th November 2012 stands.

p. 9
02

Whether the transfer to the 2nd defendant was fraudulent and whether its title is indefeasible

Holding

The 2nd defendant obtained a good title as a bona fide purchaser for value without notice of fraud; its title is upheld

Reasoning

The 2nd defendant carried out due diligence, confirmed the 1st defendant was the registered proprietor without encumbrances, bought by written agreement for valuable consideration, obtained completion documents and took possession. No collusion with registry officers was proved, and the Land Registrar testified there was no evidence of fraud. It explained the root of its title and is entitled to indefeasibility under sections 25 and 26 of the Land Registration Act.

p. 10
03

Authority of PW1 to institute the suit for the corporate plaintiff

Holding

PW1 admitted he had no authority from the plaintiff to file the suit, contrary to Order 4 rule 4 of the Civil Procedure Rules

Reasoning

Under Order 4 rule 4, where the plaintiff is a corporation the verifying affidavit must be sworn by an officer duly authorised under the company's seal. PW1 conceded under cross-examination that he lacked such authority. Despite this, the court's substantive determination was on the merits, dismissing the suit and allowing the counterclaim.

p. 10
04

Standard of proof for allegations of fraud

Holding

Fraud must be strictly pleaded and proved to a standard higher than the ordinary balance of probabilities

Reasoning

Relying on Central Bank of Kenya Ltd v Trust Bank Ltd and Christopher Ndaru Kagina v Esther Mbandi Kagima, the court reaffirmed that allegations of fraud are serious, must be pleaded with particulars and proved with evidence above the ordinary civil standard. The plaintiff's allegations remained mere allegations unsupported by reports, documents or witnesses.

p. 9

Legal principles established

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  • The party alleging fraud bears the onus of providing evidence meeting a standard higher than in ordinary civil cases
  • Where a corporate plaintiff's suit is filed without a resolution or authority of the company, the verifying affidavit requirements under Order 4 rule 4 of the Civil Procedure Rules are contravened
  • A certificate of title is conclusive and indefeasible evidence of ownership, challengeable only on fraud or misrepresentation to which the proprietor is a party

Court orders

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  1. 1.A declaration that the 2nd defendant is the legal and bonafide registered proprietor as lessee from the Government of Kenya for the remainder of the term of 943 years from 1st June 1964 of LR NO 10823/13, IR NO 140285 measuring 40.52 Ha
  2. 2.A permanent injunction restraining the plaintiff from interfering with the 2nd defendant's quiet possession and enjoyment of the suit land
  3. 3.Costs of the suit and interest to the 2nd defendant
  4. 4.Dismissal of the plaintiff's suit with costs to the defendants
  5. 5.Decline to award mesne profits under prayer (c) of the counterclaim

Authorities

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Legislation

  • Land Control ActSection 6(1)
  • Law of Contract Act (Cap 23 Laws of Kenya)Section 3(3)
  • Land Registration Act, No 3 of 2012Sections 24, 25, 26(1)(a) and (b), 44, 80
  • Registered Land Act (repealed)Section 143(1) and (2)
  • Registration of Titles Act (repealed)Section 23
  • Civil Procedure RulesOrder 4 rule 4
  • Constitution of KenyaArticle 40

Cases cited (22)

  • Arthi Highway Developers Ltd vs West End Butchery Limited & 6 Others
    [2015] eKLR
  • David Sironga Ole Tukai vs Francis Arap Muge & 2 Others
    Civ. Appeal No 76 of 2014
  • Joseph Kangethe Irungu vs Peter Ng’ang’a Muchoki
    [2018] eKLR
  • David Kiptugen vs Commissioner of Lands & 4 Others
    [2015] eKLR
  • Ketende vs Haridar & Co. Ltd
    [2008] 2 EA 173
  • Lawrence Muriuki vs A.G.
  • Elijah Makeri Nyangwaru vs Stephen Mungai Njuguna & Another
    [2013] eKLR
  • Vijay Morjoria vs Nansingh Madhu Singh Darbar & Another
    [2000] eKLR
  • Central Bank of Kenya Ltd vs Trust Bank Ltd & Others
    [1996] eKLR
  • Elizabeth Kamene Ndolo vs George Matata Ndolo
    Civil Appeal No 28 of 1995
  • Kinyanjui Kamau vs George Kamau
    [2015] eKLR
  • Chief Land Registrar & 4 Others vs Nathan Tirop Koech & 4 Others
    [2018] eKLR
  • Chiristopher Ndaru Kagina vs Esther Mbandi Kagima & Another
    [2016] eKLR
  • Ahmed Ibarahim Suleiman & Another vs Noor Khamisi Surur
    [2013] eKLR
  • Urmila w/o Mahendra Shah vs Barclays Bank International Ltd & Another
    [1979] eKLR
  • Vijay Morjoria vs Nansingh Madhusingh Darbar
    [2000] eKLR
  • Mbuthia Macharia vs Annah Mutua Ndwiga & Another
    [2017] eKLR
  • Vivo Energy Kenya Ltd vs Maloba Petrol Station Ltd & 3 Others
    [2015] eKLR
  • Embakasi Properties Ltd & Another vs Commissioner of Lands & Another
    [2019] eKLR
  • Samuel Odhiambo Oludhe & 2 Others vs Jubilee Jumbo Hardware Ltd
    Kisumu ELC 417 of 2015
  • Gichinga Kibutha vs Caroline Nduku
    [2018] eKLR
  • Belmont Finance Corporation Ltd vs Williams Furniture Ltd
Jurisdiction invoked
Environment and Land Court jurisdiction under the Environment and Land Court Act over ownership and title to land

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, "Kigwe Limited v Violet Wacuka Ngugi & 2 others; Susan Wanjiru Muriti (Interested Party) [2021] KEELC 2367 (KLR)", Case Analysis (2021). ELC Case No. 454 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2021/2367/eng@2021-07-22

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