Kihiu & 3 others v Muungano wa Wanavijiji Akiba Mashinani Trust; Waweru & 4 others (Interested Parties) (Environment & Land Case 1112 of 2013) [2022] KEELC 2416 (KLR)
The bottom line
#Nairobi court ordered Akiba Mashinani Trust to unconditionally transfer two Mukuru land parcels to community trustees within 30 days, but dismissed their interest claim.
What this practically means
#Executive summary
#Key legal issues
#Locus standi of officials of an unincorporated trust to sue
The Plaintiffs, as executive officers of the Trust duly authorized by a resolution of the Board of Trustees, had locus to institute the suit; the claim that locus was res judicata was rejected, but capacity was upheld on the merits.
The Trust, though registered under the Registration of Documents Act, was not incorporated under the Trustees (Perpetual Succession) Act and could only act through its trustees. Clause 9 of the Trust Deed vested day-to-day management in executive officers, and the Board of Trustees meeting of 16th August 2013 unanimously resolved to file the suit against the Defendant. The prior Ruling of 14th November 2014 had not determined the locus question, so it was not res judicata.
Whether the Plaintiffs discharged their obligations under the informal purchase agreement
Yes. The Defendant failed to prove the alleged outstanding debt of about Kshs 23-29 million; its accounts were unaudited, inconsistent, and the mortgage accounts were never produced, attracting an adverse inference.
The Defendant bore the burden of proving the sums allegedly owed. Its own auditor conceded he lacked evidence for stamp duty, perimeter wall, the alleged Kshs 1.5 million loan and the deposit of Kshs 72 million; DW1 admitted the amounts could not be ascertained for want of audited accounts. Failure to tender the mortgage account justified an adverse inference, and the court found the Plaintiffs had paid the sums due.
Whether the Defendant could impose conditions precedent to transfer of the suit properties
No. Having purchased the properties in trust for the Group (now the Trust) and been fully paid, the Defendant had no reasonable or lawful excuse to refuse transfer or dictate how the Trust manages the properties.
The Defendant admitted holding the title in trust for the beneficiaries and DW3 conceded the Defendant was not entitled to interfere with the Trust's management. Internal disputes within the Trust over beneficiary lists and unpaid members were not the subject of the suit and could be resolved by the Trust's board after transfer. Any voting right the Defendant holds is exercisable only within the Trust's constitution.
Claim for interest earned on the fixed deposit of Kshs 27,212,450
Claim not proved; the Plaintiffs neither produced the fixed deposit account statement nor summoned a bank official.
Although the Plaintiffs alleged interest of about Kshs 10 million, no documentary or oral evidence from the bank established the interest earned. The evidential burden lay on the Plaintiffs, and having failed to discharge it on a balance of probabilities, prayer (b) failed.
Legal principles established
#- An unincorporated trust has no separate legal existence from its trustees and can only institute a suit through its trustees and/or recognized officials.
- Where a party fails to produce crucial documents in its possession without reasonable explanation, the court may draw an adverse inference that the documents would be prejudicial to it.
- A party whose obligations under an agreement are proved on a balance of probabilities cannot have the counterparty impose unilateral conditions precedent to performance.
Court orders
#- 1.The Defendant be and is hereby ordered to unconditionally transfer L.R No. 7109/88 and L.R No. 7109/89, Nairobi to the Plaintiffs to hold them in trust for the members of Mukuru Makao Bora Trust within 30 days.
- 2.The Defendant to pay the costs of the suit.
- Jurisdiction invoked
- Original civil jurisdiction of the Environment and Land Court over land parcels L.R 7109/88 and L.R 7109/89, Nairobi
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.
- Trustees, Kenya Ports Authority Pension Scheme v Nairobi City Council & another[2023] KEELC 17455 (KLR)18 May 2023followed
Cite this brief
#Cite this brief
Caselaw, "Kihiu & 3 others v Muungano wa Wanavijiji Akiba Mashinani Trust; Waweru & 4 others (Interested Parties) (Environment & Land Case 1112 of 2013) [2022] KEELC 2416 (KLR)", Case Analysis (2022). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/2416/eng@2022-05-05
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.