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ELCAllowedEnvironment & Land Case 419 of 2017· [2023] KEELC 19045 (KLR)

Scott & another v Kihara & 4 others

Environment and Land Court
28 July 2023
AOA O Ombwayo
3,812 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~15 min to read original · ~4 min brief

The bottom line

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A Kenyan court ruled that a caretaker given power of attorney could not secretly sell his employers' land, restoring full ownership to the family.

What this practically means

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Executive summary

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The Plaintiffs, a married couple resident in Georgia, USA, sued the 1st Defendant, their former caretaker and donee of a power of attorney dated 25th February 2015, together with four others, alleging that the 1st Defendant abused the power of attorney by selling their Naivasha/Maraigushu parcels (Blocks 18/1814-18/1817, formerly 18/406, and 18/398) to the 2nd, 3rd and 4th Defendants without their knowledge or consent, in breach of trust and fraudulently. They sought declarations of ownership, a finding of breach of trust, surrender of the original title deeds, a declaration that the agreement of 16th December 2015 was not binding, a permanent injunction, and alternatively payment of the current purchase price, plus costs. The Defendants never entered appearance; service was effected by substituted advertisement in the Daily Nation, and the suit proceeded ex parte before A O Ombwayo J. The Court, citing Propwa Company Limited, held it was still obliged to interrogate the unchallenged evidence. Applying the strict-proof standard for fraud from Vijay Morjaria, Koinange and Kinyanjui Kamau, and the agency principles in CCB v MIB, the Court found the general and ambiguous power of attorney did not authorise an undisclosed sale; the 1st Defendant breached trust, and the Plaintiffs discharged the burden of proving the transactions fraudulent. All principal reliefs were granted, including declarations of ownership, surrender of title deeds, invalidity of the 2015 agreement, and a permanent injunction, with costs to the Plaintiffs.

Key legal issues

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01

Whether the ex parte claim, including allegations of fraud, was proved

Holding

The Court found that the Plaintiffs discharged the burden of proving that the transactions in respect of the suit property were fraudulent and that the 1st Defendant breached trust by acting contrary to their wishes.

Reasoning

The Court noted that despite the Defendants' non-appearance after substituted service, it retained an obligation to interrogate the Plaintiffs' evidence, since ex parte evidence is not automatic proof. Fraud must be specifically pleaded and strictly proved to a standard above a balance of probabilities. The power of attorney was general and ambiguous, and the 1st Defendant sold without the Plaintiffs' consent or knowledge, denying the sale in emails.

p. 7
02

Scope of authority under a general power of attorney

Holding

The 1st Defendant acted contrary to the wishes of the Plaintiffs; the general power of attorney did not justify an undisclosed sale, amounting to breach of trust.

Reasoning

Relying on CCB v MIB and Halsbury's Laws, the Court held that where an agent's instructions are ambiguous he must act in good faith in the principal's best interest. The donee sold the land without communicating with the donors and denied the sale, breaching trust and good faith.

p. 7

Legal principles established

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  • A claim based on fraud must be specifically pleaded and strictly proved; ex parte evidence is not automatic proof of a case.
  • An agent acting under an ambiguous power of attorney must act in good faith and place a reasonable construction on his authority.

Court orders

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  1. 1.A declaration that LR. Nos Naivasha/Maraigushu Block 18/1814, 18/1815, 18/1816, 18/1817 (formerly 18/406) and 18/398 belonged to the Plaintiffs
  2. 2.A finding that the 1st Defendant breached a duty of trust by purporting to sell the suit land without due process
  3. 3.An order that the 1st Defendant surrender to the Plaintiffs the Original Title Deed for Naivasha/Maraigushu Block 18/406
  4. 4.An order that the 1st Defendant surrender the original Title Deed for Naivasha/Maraigushu Block 18/398 in the name of Scott and a declaration that the Agreement dated 16th December, 2015 between Jonathan Maina & Esther Karanja and/or any other agreement by Jonathan Maina in respect of the properties in dispute is not binding on the Plaintiffs
  5. 5.A permanent injunction restraining the defendants, their agents, servants and any person claiming through them from trespassing, laying claim and/or proceeding with the purported sale of the suit parcels
  6. 6.Costs of the suit to the Plaintiffs

Authorities

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Legislation

  • Registration of Documents ActRegister of powers of attorney

Cases cited (9)

  • CBM v MIB & Another
    (2014) EKLr

    Duty of an agent under an ambiguous instrument to act in good faith

  • Mjasiri v Joshi
    (1990-1994) 1 EA 372

    Quoted within CBM v MIB on agency/authority

  • Agri Ltd v Christine Chepchirchir Baig & another
    (2019)

    Fraud demonstrated by denial of a sale already concluded

  • Vijay Morjaria v Nansingh Madhusingh Darbar & another
    [2000] eKLR

    Fraud must be specifically pleaded and distinctly proved

  • Suraj Lamp & Industries vs State of Haryana & Another
    (2011)

    Powers of attorney and property transactions

  • Propwa Company Limited Vs Justus Nyamo Gatondo & another
    [2020] Eklr

    Court's duty to interrogate ex parte evidence

  • Koinange & 13 others vs Charles Karuga Koinange
    1986 KLR

    Strict proof of fraud; standard above balance of probabilities

  • Kinyanjui Kamau v George Kamau
    [2015] eKLR

    Allegations of fraud must be pleaded and strictly proved

  • Ndolo vs Ndolo
    [2008] 1 KLR (G & F) 742

    Higher standard of proof for serious charges like forgery or fraud

Jurisdiction invoked
Original jurisdiction of the Environment and Land Court over disputes relating to land (Article 162(2)(b) Constitution / ELC Act) - not expressly stated in the judgment

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, "Scott & another v Kihara & 4 others", Case Analysis (2023). Environment & Land Case 419 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2023/19045/eng@2023-07-28

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