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ELCPartially AllowedMiscellaneous suit (commenced by Plaint dated 3rd March 2022); file bearing abbreviation of a Miscellaneous suit [Application], a misnomer

Oyolla v Awange & 2 others (Environment & Land Miscellaneous Case E035 of 2022) [2024] KEELC 4015 (KLR)

Environment and Land Court
6 May 2024
12,882 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~52 min to read original · ~4 min brief

The bottom line

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The Land Court confirmed that if you pay most of the purchase price, you own most of the property — even after it is sold to someone else.

What this practically means

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Executive summary

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The Plaintiff, son-in-law of the 1st Defendant, sued over L.R No. 209/14990/16 (I.R No. 90324), which the 1st Defendant purchased from Teleposta Pension Scheme for Kes.4,340,000 and later transferred to the 2nd Defendant and then to the 3rd Defendant, who developed it under a joint venture. The Plaintiff claimed a 72.78% beneficial interest by way of resulting/constructive trust, alleging he financed Kes.3,159,000 of the purchase price, and sought injunction, declarations, cancellation of entries and alternative monetary judgment. The Defendants denied his contribution, contended the funds were matrimonial property of the Plaintiff and his wife, and the 3rd Defendant claimed to be a bona fide purchaser for value without notice. The court framed three issues: trust, bona fide purchase, and reliefs. On the evidence, DW1 admitted paying only Kes.500,000, the balance cheques having come from her daughter without inquiry into their source; the Plaintiff's payments (Kes.2,159,000 and Kes.900,000) to the vendor were uncontroverted. Matrimonial-property objections failed for want of evidence and because only spouses may raise them. DW2's evidence on consideration was contradictory, defeating the bona fide purchaser claim; in any event a trust overrides under section 25 of the Land Registration Act. Judgment was entered for the Plaintiff: declarations of trust and a 70% share, cancellation of the impugned transfers, fresh registration in the ratio 30% (1st Defendant and Lucy Awange) to 70% (Plaintiff), a permanent injunction, and costs against the Defendants jointly and severally. An indemnity claim by the 3rd Defendant was not entertained absent a notice of indemnity. Tags: trust, land, bona fide purchaser, cancellation of title.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether the Plaintiff herein has tendered and placed before the court sufficient evidence to demonstrate the existence of trust [resulting or constructive trust].
  2. 2.Whether the 3rd Defendant was indeed a Bona fide purchaser for value or better still, whether the 3rd Defendant has placed before the court sufficient evidence to warrant such a declaration/finding.
  3. 3.What reliefs, if any, ought to be granted.

Key legal issues

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01

Existence of resulting or constructive trust in favour of the Plaintiff

Holding

Proved; the Plaintiff made substantial, uncontroverted contributions towards the purchase price and holds 70% beneficial share

Reasoning

DW1 admitted paying only Kes.500,000 of the Kes.4,340,000 purchase price; the balance cheques were handed over by her daughter, the Plaintiff's wife, without inquiry into their source. The Plaintiff proved payments of Kes.2,159,000 from Maisha Bora Sacco and a further Kes.900,000 cheque paid directly to the vendor, confirmed by PW2 of Teleposta Pension Scheme. The matrimonial-property objection failed for want of evidence and because only spouses may raise it.

02

Whether the 3rd Defendant is a bona fide purchaser for value without notice

Holding

Not established; consideration was not credibly proved and in any event trust overrides

Reasoning

DW2's evidence was contradictory - first confirming consideration, then denying any monies were paid, then claiming Kes.11,000,000 plus 9 apartments under a joint venture. No sale agreement existed between the 2nd and 3rd Defendants. Even a valid transfer would not extinguish a trust, an overriding interest under section 25 of the Land Registration Act.

p. 22
03

Effect of the impugned transfers on the Plaintiff's beneficial interest

Holding

All transfers and entries divesting the 1st Defendant of registration were illegal, unlawful and invalid and were cancelled

Reasoning

Since the 1st Defendant held the property on trust for herself, Lucy Awange and the Plaintiff, she could not lawfully deal with it without regard to the Plaintiff's 70% interest. Relying on sections 25(2) and 28 of the Land Registration Act, the court nullified the transfers to the 2nd and 3rd Defendants and ordered fresh registration reflecting the 70:30 split.

p. 23

Legal principles established

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  • Submissions cannot take the place of evidence
  • A transfer of property subject to a trust does not defeat or extinguish the trust, which is an overriding interest under section 25 of the Land Registration Act
  • A party claiming bona fide purchaser status must prove valuable consideration among other ingredients
  • A matrimonial property claim can only be canvassed by the spouses themselves, not by third parties

Court orders

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  1. 1.Declaration that the 1st Defendant held the suit property L.R No 209/14990/16 (I.R No. 90324) on trust for herself, Lucy Oyola Awange and the Plaintiff
  2. 2.Declaration that the Plaintiff's share in the suit property is 70%
  3. 3.Declaration that all transactions by the 1st Defendant, including the transfers to the 2nd and 3rd Defendants, were illegal, unlawful and invalid
  4. 4.Revocation, cancellation and nullification of the entries transferring the suit property to the 2nd and 3rd Defendants
  5. 5.Order that the 3rd Defendant surrender the certificate of title [lease] to the Chief Land Registrar for cancellation within 60 days
  6. 6.Revocation of the transfer and registration in favour of the 1st Defendant, with a certificate of title [lease] to issue reflecting ownership by the 1st Defendant, Lucy Awange and the Plaintiff in the ratio 30% to 70% respectively
  7. 7.Permanent injunction restraining the Defendants from dealing with or interfering with the Plaintiff's 70% share/stake in the suit property
  8. 8.Costs awarded to the Plaintiff against the Defendants jointly and/or severally

The bench

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One judgment of the whole court — no separate or dissenting opinions.

majority

Wrote the judgment

Jurisdiction invoked
Original jurisdiction over a land dispute commenced by Plaint; trust and title cancellation claims under the Land Registration Act, 2012

Relief refused

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Alternative prayer for judgment equivalent to 72.78% of the current value of the property

Court decreed a 70% share in the property itself rather than the pleaded 72.78% monetary alternative

p. 23

Indemnity in favour of the 3rd Defendant for monies spent on the project

No Notice of Indemnity was filed; the Doctrine of Departure under Order 2 of the Civil Procedure Rules prohibits it

p. 24

Costs

Costs awarded to the Plaintiff as against the Defendants jointly and/or severally, having considered the principles in Jasbir Singh Rai and 3 Others v Tarlochan Singh Rai and 4 others [2014] eKLR

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

Simply put, the Plaintiff herein has espoused and demonstrated the requisite ingredient[s] underpinning a claim for both resulting and constructing trust.
Trust established on uncontroverted evidence of contribution
the submissions by and on behalf of learned counsel for the 1st Defendant, is not anchored on any evidence or at all. Instructively, no amount of submission[s] can take the place of Evidence.
p. 16Submissions are no substitute for evidence
even if the 3rd Defendant had placed such evidence [which is not the case], it sufices to point out that the sale and/or transfer of a property that is subject to trust [like the one beforehand] does not defeat, supersede and/or extinguish the trust or at all.
p. 22Trust overrides transfer; bona fide purchaser fails
A declaration be and is hereby made that the Plaintiff's share in respect of the suit property known as L.R No 209/14990/16, registered as I.R No. 90324 is 70% thereof.
p. 23Final orders - declaration of 70% share
Consequently, the entries afiecting and impacting upon the suit property and in particular the entries relating to the transfer of the suit property in favor of the 2nd Defendant and thereafter in favor of the 3rd Defendant, be and are hereby revoked, canceled and nullified.
p. 24Final orders - cancellation of impugned transfers
There be and is hereby issued an order of permanent injunction to restrain the Defendants either by themselves, agents, servants and/or employees from dealing with and/or interfering with the Plaintiff's 70% share/stake in the suit property, in any manner whatsoever.
p. 24Final orders - permanent injunction

Issues in the judgment

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minor

Title of the suit wrongly bears the abbreviation of a Miscellaneous suit although commenced by Plaint; the court attributes the error to the registry

minor

Plaintiff's pleaded share (72.78%) differs from the 71.4% computed from the evidence and the 70% decreed

minor

Date of the Kes.500,000 cheque variously stated as 22nd April 2024 and 22nd April 2004 in the record

minor

Reference to the court order said to have been breached is inconsistent - transfer effected in 2016 (also stated as December 2020) yet the order was issued on 23rd November 2021

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, "Oyolla v Awange & 2 others (Environment & Land Miscellaneous Case E035 of 2022) [2024] KEELC 4015 (KLR)", Case Analysis (2024). Miscellaneous suit (commenced by Plaint dated 3rd March 2022); file bearing abbreviation of a Miscellaneous suit [Application], a misnomer. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/4015/eng@2024-05-06

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