Maganjo & Company Limited & 3 others v Maregwa & 4 others (Environment and Land Appeal E041 of 2022) [2025] KEELC 7207 (KLR)

2. 3. Aggrieved by this decision, the Appellant filed a Memorandum of Appeal dated 19th September 2022 seeking that the said judgement be set aside, this Appeal be allowed and the suit at the Lower Court dismissed with costs on grounds that: 1. The Learned trial Magistrate erred in both law and in fact by relying on hearsay evidence to enter judgement in favour of the Plaintifis. 2. The Learned trial Magistrate erred in both law and in fact by entering judgement in favour of the Plaintifis (Respondents herein) based on matters that had not been pleaded or tendered in evidence. 3. The Learned trial Magistrate erred in both law and in fact by ignoring evidence tendered by the Defendants (Appellants herein) and solely relying on evidence tendered by the Plaintifis. 4. The Learned trial Magistrate erred in both law and in fact by being biased in favour of the Plaintifis instead of applying the law to all parties equally. 5. The Learned trial Magistrate erred in both law and in fact in entertaining extraneous matters that were not relevant to the case. 6. The Learned trial Magistrate erred in both law and in fact in disregarding and or failing to accord the necessary consideration to the evidence by the Appellants. This Appeal was canvassed by way of written submissions. The Appellant’s Submissions. 4. On whether the learned Trial Magistrate erred in entering judgement in favour of the Respondents on matters that had not been pleaded, counsel submitted that the issue of validity of contract was not raised in the Further Amended Plaint but the trial court made a determination on it. It was argued that parties were not given an opportunity to litigate on the issue of the validity of contract therefore disadvantaging the Appellants. It was an error for the learned Trial Magistrate to base the judgement on an issue that was not ventilated, and the suit should be remitted back to the lower Court for re-trial. 5. On whether the learned Trial Magistrate disregarded evidence tendered by the Appellants and solely relied on evidence tendered by the Respondents, counsel submitted that the Appellants accused the Respondents of fraud and submitted evidence to this efiect such as the letter dated 8th December 2011 from the Town Clerk addressed to Maganjo & company, the letter dated 16th March 2012 from the DCI Kajiado in response to the letter dated 20th January 2012. It was submitted that the 3rd Respondent gave the 4th Appellant documents for both Maganjo & Company as well as Maganjo & Company Limited and to a lay person, there was no difierence in the two names. Therefore, evidence tendered at the lower Court showed that the 4th Appellant was an innocent purchaser as defined in Lawrence Mukiri vs Attorney General and 4 others [2013] eKLR. It was also their submission that the 4th Appellant was very familiar with Magu Rutere and his children since he was a young boy and after he purchased the property, Magu introduced him to the tenants and he started collecting rent. The issue of the difierence in identity card number, was also submitted to have been an erroneous mistake on the part of 4th Appellant. As such, the 4th Appellant was not involved in any fraud in the purchase of the suit property and none was proven as per the standards held in Evans Kidero vs Speaker Nairobi County Assembly and another (2018) eKLR 6. They urged that Appeal should therefore be allowed as prayed together with costs. https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/7207/eng@2025-10-16 2

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Submissions of the Respondents 7. The Respondent claims that they were the registered owners of plot No. 14 Majengo A Kajiado Township and put up a temporary house which was generating Kshs. 24,000 each month. However, sometime in 2011 they were stopped by the 4th Appellant who claimed ownership of the suit plot having purchased it from the 1st, 2nd and 3rd Appellants, and later stated that he purchased it from one Magu Rutere. The Respondents claim that the owner of the land is Maganjo & Company and not Maganjo & Company Limited (the 1st Appellant). Therefore, any transaction from the 1st Appellant was fraudulent. It was also their submission that the rates clearance certificate issued to the 1st Appellant on 27th March 2006 was erroneous because it was issued before the 1st Appellant became a registered entity. It was also their submission that the 2nd and 3rd Appellants were charged at Kibera Law Courts Criminal Case No. 40 of 2013 for charges on conspiracy to defraud, giving false information to a person employed in the public ofice and stealing. 8. It was further submitted that one Magu Rutere of ID No. 0088126, the one the 4th Appellant claims to have paid Kshs. 450,000 was difierent from Magu Rutere, father to Samuel Githinji one of the Respondents whose ID No. was 0088128. Counsel also submitted that the 4th Appellant did acknowledge that there was a difierence between Maganjo & Company Ltd and Maganjo & Company, and that had he known this, he would not have been involved in the transaction. As such, the Appellants fraudulently used the Respondent’s documents to efiect a transfer to the 4th Defendant. Counsel went on to submit that the purported agreement between the Appellants was not attested and questioned whether one of the parties who signed the agreement using his thumbprint was aware of its content. 9. From the above, counsel submitted that the Appellants did not prove their validity of the suit property and the learned Trial Magistrate correctly entered judgement in favour of the Respondents because the suit property was never the . Reference was made to the cases of CMC Aviation Ltd. vs. Cruisair Ltd. (No. 1) [1978] KLR 103; [1976 80] 1 KLR 835; Robert Ngande Kathathi v Francis Kivuva Kitonde [2020] eKLR and Kenya Refuse Handlers Limited v City Council of Nairobi [2019] eKLR. Analysis and Determination 10. 11. The Appellants, raised six grounds of Appeal. Which can be compressed into the following issues; i. Whether the Learned trial Magistrate erred in both law and in fact by relying on hearsay evidence to enter judgement in favour of the Plaintifis. ii. Whether the Learned trial Magistrate erred in both law and in fact by entering judgement in favour of the Plaintifis (Respondents herein) based on matters that had not been pleaded or tendered in evidence. iii. Whether the Learned trial Magistrate erred in both law and in fact in entertaining extraneous matters that were not relevant to the case. iv. What orders should issue? v. Who should bear costs of this Appeal?. This being a first Appeal, the court must conduct a fresh and independent evaluation of the entire evidence adduced before the trial court while bearing in mind, that it did not hear or observe the witnesses. https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/7207/eng@2025-10-16 3

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See Richard Wefwafwa Songoi Vs. Ben Munifwa Songoi (2020) KECA 942 (KLR) where it was stated thus; In Selle Vs. Associated Motor Boat co. (1968) EA 123, it was stated thus; --------Briefiy put they are that this court must reconsider the evidence, evaluate it itself and draw its own conclusions though it should always bear in mind that it has neither seen nor heard the witnesses and should make due allowance in this respect…..” 12. Through the Further Amended Plaint dated 22nd October 2021, the Respondents claim that plot No. 14 Majengo A Kajiado Township was duly allotted to them through Maganjo and Company. The Letter of Allotment which was in possession of the 3rd Respondent (Magu Rutere) got lost and a report was made at Upper Hill Police Station in the year 2009. In 2011 as they were erecting a fence on the suit property, they were stopped by police oficers on the claim that the plot belonged to the 4th Appellant having purchased it from the 1st, 2nd and 3rd Appellants. It was their claim that they had not sold the plot to anyone and they filed a report at the Land Fraud Investigation department at the Directorate of Criminal Investigations. 13. These investigations revealed that the 2nd Appellant while employed by the Respondents stole the documents relating to the suit property and conspired with the 3rd Appellant to incorporate the 1st Appellant which was trading in a name similar to the 1st Respondent. It is their case that this was fraudulently done because the Registrar of Companies should not have approved the name for registration. 14. Further that the transfer and allotment of plot No. 14 was illegally done and the 4th Appellant did not have legal claim over it. They sought a declaration that as the bonafide owners and the letter of allotment issued to the 4th Defendant to be cancelled. They also sought that the Appellants be restrained from interfering with the suit property in any manner. They also sought general damages as well as special damages for Kshs. 650,000 as rental income of Kshs. 24,000 per month from the year 2011. 15. The Appellants in their Statement of Defence denied the allegations stating that the 4th defendant purchased the suit property on 18th December 2008 and the purchase price paid to the 3rd Respondent in presence of the 2nd and 3rd Appellants. Therefore the claim that Letter of Allotment was lost was false because the original Letter of Allotment was surrendered to OlKejuado Town Council and the suit transferred to the 4th Appellant. They urged the court to dismiss the suit. 16. One of the witnesses, was Corporal Samuel Kamau, attached at the Directorate of Criminal Investigations who stated that he carried out investigations into the alleged fraud and later charged the 2nd and 3rd Appellants with a criminal ofience. He stated that the 4th Appellant was innocent because he was duped into buying the plot. 17. PW2 in her testimony stated that their company was Maganjo and Company while the company that sold the suit property was Maganjo and Company Limited. It was her testimony that the 2nd and 3rd Appellant’s father and husband respectively were partners in Maganjo and Company. PW3 Samuel Githinji acknowledged that his father the late Magu Rutere was the custodian of the 1st Respondent’s documents (Maganjo & Co) which got lost at some point. He stated that the late Magu Rutere could neither read nor write and therefore was not aware of the sale agreement with the 4th defendant. It was his testimony that the 2nd Appellant and his father- Magu Rutere were close friends. https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/7207/eng@2025-10-16 4

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18. The 4th Appellant in his testimony stated that the documents in his possession for the suit property were given to him by the 2nd Appellant with authority from one Magu Rutere. He further stated that upon purchase of the suit property, the said Magu Rutere handed over the tenants residing thereon to him before relocating to his rural home. On cross examination it was his testimony that he believed the 4th Respondent and the 1st Appellant were the same entity and since Magu Rutere referred him to the 2nd and 3rd Appellants, he had no reason to doubt the transaction. He also confirmed that the receipt dated 27th March 2006 was in the name of the 1st Appellant although the Certificate of Incorporation showed that the company was incorporated on 13th November 2007. It is on record that he stated, “Yes, letter of allotment issued to the 4th plaintifi was on 13th May 1992 but I didn’t notice that I was equally duped by the 2nd Defendant…” 19. The Learned Trial Magistrate in her judgement found that the Plaintifis (the Respondents herein) were the bona fide owners of plot No. 14 Majengo A Kajiado Township and that the letter of allotment issued to the 4th Defendant (the 4th Appellant herein) be recalled and cancelled. 20. Having reviewed the evidence on record as well as witness statements, it is not in contention that the 1st Appellant and the 4th Respondent are two difierent entities. That is Maganjo and Company Limited vis a vis Maganjo and Company. It is on record that the suit property Plot No. 14 Majengo A Kajiado Township was first allotted to Maganjo and Company on 13th May 1992. However on 30th December 2006, Maganjo and Company Limited applied for a transfer of the suit property. There is no evidence showing how the suit property changed hands from Maganjo and Company to Maganjo and Company Limited. It is also on record that the said Maganjo and Company Limited was incorporated on 13th November 2007. It is therefore not clear how the plot was registered in favour of a company that was non-existent at the time of registration. 21. It is also on record that investigations were conducted into the sale and transfer of the suit plot to the 4th Appellant and criminal charges preferred against the 2nd and 3rd Appellants. 22. It is now well settled that the end result in land transactions is as good as the process. If the process is fiawed, then the end result would be equally fiawed. This was the Court of Appeal’s holding in Munyu Maina v Hiram Gathiha Maina [2013] KECA 94 (KLR): “ … when a registered proprietor’s root of title is under challenge, it is not suficient to dangle the instrument of title as proof of ownership. It is this instrument of title that is in challenge and the registered proprietor must go beyond the instrument and prove the legality of how he acquired the title and show that the acquisition was legal, formal and free from any encumbrances including any and all interests which need not be noted on the register…” 23. It is clear that the 1st, 2nd, 3rd Appellants impersonated the Plaintifis’ business name and its partners by selling, receiving money for sale and authorizing money for sale and authorizing the transfer of the suit property purporting it is the 1st Appellant’s Company name knowing very well they were not lawfully and legally entitled to do so. They held themselves out as the lawful owners of the suit property whereas it was allocated to the 1st Respondent. 24. The Learned Trial Magistrate rightly found that fraud had been proved against the 1st, 2nd, 3rd Appellants. The Learned Trial Magistrate also correctly held that 2nd, 3rd Appellants being the sole directors of the 1st Appellant decided to dispose of the suit property barely one year after the 1st Appellant had been registered. https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/7207/eng@2025-10-16 5

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25. I am of the view that the Learned Trial Magistrate exercised her discretion properly by finding in favour of the Respondents herein. 26. I find that the Learned Trial Magistrate considered all the evidence and arguments of the parties and applied the relevant law properly before reaching her conclusion. I find no basis to interfere with the said Judgement. 27. In conclusion, the Appeal is found to be without merit. The same is dismissed with costs to the Respondents. DATED, SIGNED AND DELIVERED VIRTUALLY AT KAJIADO THIS 16TH DAY OF OCTOBER, 2025. L. KOMINGOI JUDGE. In the presence of. Mr. Ibrahim Mwangi for the Appellants. Mr. Mugo for the Respondents. Peter – Court Assistant. https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/7207/eng@2025-10-16 6

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