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ELCDismissedOriginating Summons dated 22nd March 2016, filed 23rd March 2016· [2021] KEELC 3949 (KLR)

Mumbu Holdings Limited v National Social Security Fund & another [2021] KEELC 3949 (KLR)

Environment and Land Court of Kenya
18 March 2021
5,593 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~22 min to read original · ~4 min brief

The bottom line

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Kenya's Environment and Land Court ruled that NSSF land cannot be claimed through adverse possession, and buyers must survey property before purchase.

What this practically means

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Executive summary

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The Plaintiff filed an Originating Summons on 23rd March 2016 seeking a declaration that it had acquired 0.3521 of a hectare of L.R No. 12948/178 Mountain View, Nairobi by adverse possession under section 7 of the Limitation of Actions Act, an order vesting that portion in it, and substitution in the register under section 125 of the Registered Land Act. The Plaintiff, which entered in 1995 under a sale agreement with Elijah Koskei (an allottee under an illegal subdivision by the Commissioner of Lands), built seven houses and occupied openly and continuously until 2015, when it learned the 1st Defendant had sold the property to the 2nd Defendant in December 2013. The 1st Defendant (NSSF) contended the allotment was cancelled, that it had negotiated a purchase price of Kshs. 6,325,149.60 which the Plaintiff never paid, and that its land was Government-enjoyed and immune from adverse possession. The 2nd Defendant, a purchaser for value who charged the property to Chase Bank, contended its title was indefeasible and the 12-year period had not run against it. The court first held that NSSF is a Government agency whose land is shielded from adverse possession by section 41(a)(1) of the Limitation of Actions Act, declining to follow Tsuma Lewa Deche and adopting the reasoning in Kimoi Ruto and ICDC v Simotwo. It held that although the Plaintiff would have proved adverse possession as at 23rd December 2013, the claim against the 1st Defendant failed for bar by section 41(a)(1), and the claim against the 2nd Defendant was premature, the suit having been filed barely 3 years after registration. The suit was dismissed with each party bearing its own costs, the Defendants being denied costs because of their own inaction and lack of due diligence.

Key legal issues

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01

Whether land held by the NSSF is excluded from adverse possession claims under section 41(a)(1) of the Limitation of Actions Act

Holding

Yes. The NSSF is a Government agency/entity whose land is enjoyed by the Government for purposes of section 41(a)(1), so its land cannot be acquired by adverse possession.

Reasoning

The court examined the objectives of the NSSF under the NSSF Act, the level of Government control over its operations and management, and its public connotation. It declined to follow Tsuma Lewa Deche, holding that decision only considered whether NSSF was a corporation under section 2 of the Act, and instead adopted the opinions of Munyao J and Ohungo J in Kimoi Ruto and ICDC v Simotwo, noting the court was not bound by a decision of a court of equal status.

p. 5
02

Whether the Plaintiff proved adverse possession against the 1st Defendant

Holding

On the facts it would have succeeded as at 23rd December 2013, but the claim is barred by section 41(a)(1) and therefore fails.

Reasoning

It was common ground that the Plaintiff entered in 1995, occupied openly, exclusively and without permission until 2013, and that the portion was identifiable. Had section 41(a)(1) not applied, adverse possession would have crystallized by 23rd December 2013. However, since the limitation provisions do not apply to the 1st Defendant's land, no right to sue by adverse possession accrued against it.

p. 5
03

Whether the Plaintiff proved adverse possession against the 2nd Defendant

Holding

No. The suit was filed barely 3 years after the 2nd Defendant acquired the property, so the 12-year period had not run and the claim was premature.

Reasoning

The 2nd Defendant was registered as owner on 23rd December 2013 and the suit was filed on 24th March 2016. Time had therefore run for only about 2 years 3 months, far short of the statutory 12 years required under section 7 of the Limitation of Actions Act.

p. 6
04

Costs of the suit

Holding

Although the Plaintiff lost, the Defendants were denied costs because their own inaction and lack of due diligence occasioned the Plaintiff's loss.

Reasoning

Under section 27 of the Civil Procedure Act costs are discretionary. The 1st Defendant failed to assert its rights promptly after the 1996 demand letters and sold the property with full knowledge of the Plaintiff's occupation. The 2nd Defendant, spending Kshs. 35,000,000, ought to have surveyed the property before tendering. The court accordingly denied the Defendants costs.

p. 6

Legal principles established

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  • Land held by the National Social Security Fund is land enjoyed by the Government and is shielded from adverse possession claims under section 41(a)(1) of the Limitation of Actions Act
  • The period during which a state corporation holds land as registered proprietor is excluded when computing limitation for adverse possession
  • A claim filed before expiry of the 12-year limitation period against a subsequent registered owner is premature and untenable

Court orders

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  1. 1.The Plaintiff's Originating Summons is dismissed
  2. 2.Each party to bear its own costs

Authorities

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Legislation

  • Limitation of Actions Actsection 7
  • Limitation of Actions Actsections 17 and 38
  • Limitation of Actions Actsection 41(a)(1)
  • Limitation of Actions Actsection 2
  • Registered Land Actsection 125
  • Civil Procedure Actsection 27
  • National Social Security Fund Actsections 4, 5, 6 and 70
  • Constitution of KenyaArticles 61, 227 and 260

Cases cited (11)

  • Gabriel Mbui v Mukindia Maranya
    [1993] eKLR
  • Kimani Ruchine & Another v Swift, Rutherford Co. Ltd. & another
    [1977] KLR 10
  • Wambugu v Njuguna
    [1983] KLR 172
  • Githu v Ndeete
    [1984] KLR 776
  • Joseph Ndungu Kamau v John Njihia
    [2020] eKLR
  • Peter Ndungunya Ole Sono & 2 others v Lands Limited & another
    [2019] eKLR
  • Kimoi Ruto & Another v Samwel Kipkosgey Keitany & Another
    [2014] eKLR
  • Industrial & Commercial Development Co-operation v Reuben Arap Simotwo & 20 others
    [2019] eKLR
  • R.D.Shetty v The International Airport Authority of India & others
    [1979] AIR 1628, 1979 SCR(3) 1014
  • Association of Retirement Benfits Schemes v Attorney General and 3 others
    [2017] eKLR
  • Tsuma Lewa Deche & Another v Board of Trustees National Social Security Fund
    [2009] eKLR
Jurisdiction invoked
Original jurisdiction under sections 7, 17, 37 and 38 of the Limitation of Actions Act (Cap. 22) to register title by adverse possession; costs under section 27 of the Civil Procedure Act (Cap. 21)

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, "Mumbu Holdings Limited v National Social Security Fund & another [2021] KEELC 3949 (KLR)", Case Analysis (2021). Originating Summons dated 22nd March 2016, filed 23rd March 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2021/3949/eng@2021-03-18

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