Mukhongo & 8 others v Mbevo Investment Limited & 6 others (Enviromental and Land Originating Summons E037 of 2024) [2025] KEELC 4574 (KLR)

JUDGMENT The pleadings 1. The Plaintifis filed suit by way of originating summons dated the 3/6/24 seeking the following orders; a. That the directors of the 1st Defendant are hereby ordered to execute a transfer of the reversionary leasehold interest in Land Reference Number 209/11342 (Original Number 209/10505/3) I. R No. 57798 in favour of the 9th Plaintifi and to cause the said transfer to be registered in the name of the 9th Plaintifi within 14 days of this order. b. That in default of execution of the said transfer, by the directors of the 1st Defendant, the Deputy Registrar of the Environment and Land Court at Nairobi to execute all documents required to efiect successful transfer of reversionary leasehold interest in Land Reference Number 209/11342 (Original Number 209/10505/3) I. R No. 57798 to the 9th Plaintifi. c. That in the event the Directors of the 1st Defendant fail to avail the Original Certificate of title; the Land Registrar is hereby directed to register the revisionary interest in Land Reference Number 209/11342 (Original Number 209/10505/3) I. R No. 57798 in favour of the 9th Plaintifi without requiring the production of the Original Certificate of Title and to make such other entries in the Register as would give efiect to the Court’s orders herein. d. That the Directors of the 1st Defendants are hereby ordered to surrender the Original Certificate for Land Reference Number 209/11342 (Original Number 209/10505/3) I. R No. 57798 with reversionary interest registered in favour of the 9th Plaintifi to the Plaintifis’ Advocates. e. That in the event the Directors of the 1st Defendant fail to avail the Original Certificate of title; the Land Registrar is ordered to issue a provisional Certificate of Title for Land Reference Number 209/11342 (Original Number 209/10505/3) I. R No. 57798 with reversionary interest registered in favour of the 9th Plaintifi. f. Costs of Application to be provided for. 2. The summons is based on the grounds annexed thereto and the supporting afidavit of Christian Dominic Alukwe Witila, the 8th Plaintifi sworn on the 3/6/24. He deponed that he has authority to swear the afidavit on his own behalf and that of the rest of the Applicants/Plaintifis. 3. It is the 1st -8th Plaintifis case that they own the 1st -8th fiats erected on land Reference Number 209/11342 (original number 209/10505/3 IR No 57798 in South C Nairobi County forming a gated community. 4. That the 2nd -5th Defendants are directors of the 1st Defendant, the original owner and developer of the suit land. The 1st Defendant constructed 8 fiats and sold them to the Plaintifis by way of assigning leases for the remainder period of the mother title. 5. The 6th defendant is a company created by the 1st Defendant with the intention of serving as a management company to hold the reversionary interest in the suit land upon which the fiats sit and also to manage the common areas and provide commons services on behalf of the fiat owners. However, it was averred that the 6th defendant has never been operationalized and or the shares issued in favour of the Plaintifis and therefore the Plaintifis are yet to acquire shares two decades later. It is for that reason https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/4574/eng@2025-04-24 2

page 2 of 6

that the 1st -8th Plaintifis have formed the 9th Plaintifi Company to manage the common areas and hold the reversionary interest in the suit title on their behalf. 6. That after the sale of the last fiat in 2004, the 1st Defendant lost interest in the suit land with respect to the transfer of shares and the operationalization of the 6th Defendant and the attendant transfer and registration of the reversionary interest in favour of the fiat owners. That said, the Plaintifis have continued in occupation while meeting their obligations in respect to payment of the land rent and other outgoings for the suit property. 7. That according to the sale agreement between the plaintifis and the 1st Defendant, the purchasers paid for the reversionary interest and the 1st Defendant was obligated to transfer the said reversionary interest to the 6th Defendant Company to hold on behalf of the Plaintifis. Secondly the plaintifis were to pay to the management company their share of the management expenses for the common areas and services. Further to the sale agreement, the 1st and 6th Defendants and the purchasers entered into a sublease agreement which stipulated that the manager (6th Defendant) had been incorporated for the purpose of holding the reversionary interest as well as manage the estate on behalf of the Plaintifis. The Plaintifis paid the sum of Kshs 1000/- each being their apportioned share of the reversionary interest as well as subscription for one ordinary share of Kshs 100/- fully paid in the 6th Defendant. The membership and ownership of the share was to remain inseparable portion of the lease. 8. That in total breach of the terms of the agreement for sale and the sublease the directors of the 1st and 6th Defendant have refused and or neglected to transfer both the shares in the management company and the reversionary interest in the suit title to the management company to hold for the benefit of the Plaintifis. 9. As a consequence of the said breach of the agreement of sale and the sub lease, the 1st -8th Plaintifis are unable to efiectively manage, tend to and carry out general up keep of the areas and grounds forming part of the common areas and or own the reversionary interest in the title. The title for the suit land still remains in the name of the 1st Defendant despite all the fiats, shares and the reversionary interest having been sold to the Plaintifis. Also, he contends that the whereabouts of the original title for the suit land is unknown. 10. In addition, he averred that the whereabouts of the directors of the 1st and 6th Defendants remain unknown despite efiorts to trace them including service of the summons herein through substituted services. 11. That it is just and proper that the court allows the summons to enable the Plaintifis to own the reversionary interest and manage their property through the 9th Plaintifi which is jointly owned by the plaintifis. 12. Save for the 7th Defendant, the rest of the defendants despite service failed to enter appearance and or file defences. The evidence 13. At the hearing of the suit, the evidence of the plaintifis was adduced by Christian Dominic Alukwe Witila who relied entirely on the supporting afidavit on record along with the documents annexed thereto and marked LML1-9 on pages 11-55 of the plaintifis’ trial bundle. 14. He stated that the Plaintifis are apartment owners having purchased the said fiats from the 1st Defendant. That save for the shares in the would-be management company (6th Defendant) and the https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/4574/eng@2025-04-24 3

page 3 of 6

reversionary interest in the title, all the fiats were transferred to each of the Plaintifis, the last being in 2004. 15. That arising from the breach of the agreement of sale and the sublease by the 1st Defendant, they incorporated a company, the 9th Defendant owned by all the 1st -8th Plaintifis for the purpose of managing the common areas and providing common services to the Plaintifis. It is this company that they want to hold the shares and the reversionary interest in the title. 16. With that the Plaintifis closed their case 17. As alluded earlier the defendants failed to enter appearance nor file defenses. The submissions 18. The Plaintifis have filed written submissions which I have read and considered and form part of the Judgement Analysis and determination 19. Having considered the summons, the evidence adduced at the hearing and the written submissions the key issue for determination is whether the Plaintifis are entitled to the reliefs sought. 20. It is not in dispute that the suit is undefended. Despite service none of the defendants entered appearance nor filed defence. That said the plaintifis bear the burden of proving their case however undefended it may be. 21. It has not been refuted that the 1st Defendant being the registered owner of the suit land developed 8 fiats in the 1990s and sold to the 1st -8th Plaintifis, the last having been sold in 2004. The 1st Defendant incorporated the 6th Defendant with the intention that it would be the management company that would manage the common areas in the suit property and hold the reversionary interest in the land upon which the fiats are situate. The 2nd -5th Defendants are the directors of the 2nd Defendant while the 2nd and the 4th defendants are directors of the 6th Defendants. 22. It is not in dispute that the Plaintifis entered into sale agreements and sublease agreements with the 1st Defendant for the sale of the fiats, reversionary interest and the subscription of shares in the management company. The court has perused one of such lease agreements and the sale agreements on pages 25 – 42 and 48-53 of the trial bundles respectively and will highlight some of the relevant clauses. For example, Para F of the sale agreement provided that the purchaser shall pay transfer fee for the reversionary interest to the management company in the sum of Kshs 4000/- 23. It was a term of the agreement under clause G thereof that the vendor shall execute a transfer of its reversionary interest of the last seven days to the management called Savannah Court Limited in which each of the purchasers of the 8 fiats on the said piece of land shall have an equal share upon completion of the sale of the 8 fiats. It was acknowledged that the purchaser has paid a consideration of Kshs 1000/to J M Njage & Company Advocates being the proportionate share for the purchase of the reversionary interest to hold the same as stakeholder pending the registration the transfer of the reversionary. 24. Under clause I of the said agreement it was agreed by the parties that the purchasers shall pay to the management company which shall be formed by the owners of all the fiats and shall share all expenses incurred by the management company in the upkeep and maintenance of the grounds and buildings forming part of the said piece of land together with the proportionate share of all expenses in respect of the common services thereto as more specifically detailed in the lease. https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/4574/eng@2025-04-24 4

page 4 of 6

25. The corresponding clauses in the lease agreement are found in clause 4 which stipulates that the 1st Defendant has incorporated a management company for purposes of holding the reversionary interest in the land on behalf of the fiat owners and for managing the estate and that the payment of Kshs 1000/- had been paid for one ordinary share in the said management company. 26. Under cause 4 ( e) of the special conditions of the lease, the 6th Defendant would receive the reversionary interest within 60 days of the registration of transfer of all the 8 fiats. According to the copy of the title adduced by PW1, the last lease was registered on 19/5/2004 and therefore in accordance with the said special condition the reversionary interest was to be transferred to the management company by 20/8/2004. The plaintifis have led unchallenged evidence that the 1st Defendant is yet to comply with the provisions of the lease which bound the parties. 27. The court has also perused the copy of the search dated the 27/2/25 in form of the certified copy of the title and it is evident that the reversionary interest is yet to be transferred to either the 6th Defendant or the plaintifis for that matter. It is still in the name of the 1st Defendant. 28. PW1 confirmed that all the fiats have been sold and each of the lessees has paid for the reversionary interest as well as the shares in line with the terms of the lease and the sale agreement. He further confirmed that none of the defendants have any other interest in the suit property having received the full purchase price as per the purchase/sale agreements aforestated. The Plaintifis are desirous to have the reversionary interest be transferred to the 9th Plaintifi, a company owned by each of the fiat owners. In the circumstances, there is no valid reason why the Defendants should continue to hold the reversionary interest in the suit property. It is therefore the finding of this court that the 1st – 8th defendants are entitled to the reversionary interest and the defendants are obligated to transfer the same to the 9th defendant forthwith. 29. I agree with the plaintifis that absent the reversionary interest in their favour their rights to property will be afiected in that their ownership of the fiats will be incomplete. Without the reversionary interest the plaintifis right to own the suit property including the fiats and fulfil their rights under the head lease to the head lessor will be curtailed. 30. It is for the foregoing reasons that I find that, on a balance of probabilities, the plaintifis have proved their case. 31. Costs follow the event. In this case the suit was undefended and therefore I make no orders as to costs. Final orders for disposal 32. In the end the Plaintifis’ suit is meritorious and I enter judgment in their favour as follows; a. The directors of the 1st Defendant be and are hereby ordered to execute a transfer of the reversionary leasehold interest in Land Reference Number 209/11342 (Original Number 209/10505/3) I. R No. 57798 in favour of the 9th Plaintifi and to cause the said transfer to be registered in the name of the 9th Plaintifi within 30 days of this order. b. In default of execution of the said transfer, by the directors of the 1st Defendant, the Deputy Registrar of the Environment and Land Court at Nairobi be and is hereby ordered to execute all documents required to efiect successful transfer of reversionary leasehold interest in Land Reference Number 209/11342 (Original Number 209/10505/3) I. R No. 57798 to the 9th Plaintifi. https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/4574/eng@2025-04-24 5

page 5 of 6

33. c. In the event the Directors of the 1st Defendant fail to avail the Original Certificate of title; the Land Registrar is be and is hereby ordered to register the revisionary interest in Land Reference Number 209/11342 (Original Number 209/10505/3) I. R No. 57798 in favour of the 9th Plaintifi without requiring the production of the Original Certificate of Title and to make such other entries in the Register as would give efiect to the Court’s orders herein. d. The Directors of the 1st Defendant are hereby ordered to surrender the Original Certificate for Land Reference Number 209/11342 (Original Number 209/10505/3) I. R No. 57798 with reversionary interest registered in favour of the 9th Plaintifi to the Plaintifi’s Advocates. e. In the event the Directors of the 1st Defendant fail to avail the Original Certificate of title; the Land Registrar is hereby ordered to issue a provisional Certificate of Title for Land Reference Number 209/11342 (Original Number 209/10505/3) I. R No. 57798 with reversionary interest registered in favour of the 9th Plaintifi. f. I make no orders as to costs. Orders accordingly DELIVERED, DATED AND SIGNED AT NAIROBI THIS 24TH DAY OF APRIL 2025 VIA MICROSOFT TEAMS. J. G. KEMEI JUDGE Delivered Online in the presence of: Ms Wahito HB for Mr Muturi NA for the 1st -6th Defendants Ms Nyawira for the 7th Defendant CA- Ms Catherine https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/4574/eng@2025-04-24 6

page 6 of 6