Oundo v Ondiek (Environment and Land Case E013 of 2023) [2024] KEELC 592 (KLR)

The court traced the Plaintiff's chain: purchase at auction as highest bidder, full payment, transfer and issuance of title deed. The Defendant claimed non-service of notices, undervalue and bad faith but placed no evidence before the court, producing neither the Loan Agreement nor the Charge to establish his contractual postal address, nor a valuation report, nor communications with Equity. The Defendant's contentions were therefore unrebutted and the Plaintiff's good-faith purchase for value stood. Damages would not suffice as the Defendant had defaulted on the loan, might not make good waste, and collected rent he could not refund.

The Defendant claimed notices were sent to wrong postal addresses, but the Loan Agreement and Charge, in the possession of the Defendant and Equity, would have shown his contractual address for service. He produced neither those documents nor any communication through his claimed P.O. Box 1 Miwani address, despite alleging pre-sale negotiations. Without evidence, the court could not find on a prima facie basis that he was not served, that the property was valued at Kshs. 10,000,000/-, or that negotiations occurred. Even if irregularity existed, the remedy lay in damages against Equity, not against the innocent purchaser.

Relying on section 99 of the Land Act and the cited authorities, the court held that a purchaser of charged land sold in exercise of the statutory power of sale is not answerable for misapplication of purchase money, need not inquire into default, notice or regularity, and is protected even with actual notice of irregularity except in cases of fraud. No wrongdoing was alleged against the Plaintiff, and his good-faith purchase for valuable consideration was unrebutted. The Defendant's equity of redemption was extinguished at the fall of the hammer.