Dr. George Gitau Wainaina v Kenya Commercial Bank Ltd, Ephraim Wambu Miano & A.M Macharia

and/or agents from interfering, parting with, selling or in any other way dealing in all the pieces of land known as L.R KAJIADO/KAPUTIEINORTH/4302 c. A declaration that the plaintiff herein is the bona fide purchaser of the property namely L.R KAJIADO/KAPUTIEI-NORTH/4302 2. It is the Plaintiff’s case that by a loan Agreement made between the 1st Defendant and 2nd Defendant, the 1st Defendant agreed to grant the 2 nd Defendant money against charges on two parcels of land; Kajiado/KaputieiNorth/4302 and Kajiado/Kaputiei North /4303 in favour of 1st Defendant. 3. The 2nd Defendant subsequently defaulted on the required payments to the 1st Defendant. To recover the funds towards the 2nd Defendant/borrower 1st Defendant to consented to the 2nd Defendant to sell the charged properties by private treaty. 4. The 2nd Defendant found a buyer, the plaintiff herein. The two properties were sold for Kshs5,000,000/=. It is his case that the 2nd Defendant failed to remit the amount owed to the 1st Defendant, who released only the title for Kajiado/Kaputiei North /4302 but not for Kajiado/KaputieiNorth/4302. ELC E009 OF 2022 2

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It is his case that the 1st Defendant went ahead to issue a statutory notice of sale of Kajiado/Kaputiei North/4302 despite the consent to sell by private treaty. 5. The particulars of fraud against the 1 st Defendant are given in paragraph 17 a-b as follows:(a) Seeking to exercise Chargee's right of Power of Sale in default of payments of borrowings against a charge knowing full well that a sale of Kajiado/Kaputiei North/ 4302 had already taken place after it the 1st Defendant consented to sale by way of private treaty. That the 1st Defendant on the 19th day of January 2009 purported to issue a statutory Notice of Sale to the 2nd Defendant as the Chargor of L.R. Kajiado/Kaputiei - North/4302. (b) (i) Failing to act honestly; (ii) Making a demand with a calculated intent of putting pressure on the 2nd Defendant to succumb to payments which are not due; (iii) Purporting to issue statutory notice as provided for under provisions of Section 74(b) of the Registered Land Act Cap 300 ELC E009 OF 2022 3

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Laws of Kenya on a property already sold at its own behest; (iv) Ignoring its own express covenant with the 2nd Defendant for sale by private treaty and therefore imposing a greater liability on the Plaintiff contrary to acceptable business practice. (v) Attempting to recover moneys that are allegedly due from the 2nd Defendant by a course that would subject the Plaintiff to double jeopardy in regard to purchase of C.R. Kajiado/Kaputie1-North/4302 through threat of sale of the Plaintiff's property. 6. The particulars of fraud against the 2 nd Defendant are given as follows:a. Failing to remit the full amount of money required to the 1st Defendant as per the consent Agreement between himself and the Chargee/Bank. b. Failing to discharge his Vendor's obligation of divulging all defects of the property to be sold, in this case full disclosure of amount owing to the bank in regard to L.R. Kajiado/Kaputiei-North/4302 And 4303 Kajiado/Kaputiei-North/4303 thus causing the Plaintiff to suffer deprivation of what is due to ELC E009 OF 2022 4

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him after paying full purchase price on the subject properties. c. Executing Transfer documents in favour of the Plaintiff for L.R. Kajiado/Kaputiei North/ 4302 knowing well that the certificate of title to that parcel of land was still held by the 1st Defendant d. Failing to inform the Purchaser/Plaintiff that a statutory notice of sale had been served to him for sale of the Plaintiff's property, that is to say L.R. Kajiado/Kaputiei North/ 4302. e. Misrepresenting to the Plaintiff on the amount of money owed. 7. The particulars of fraud against the 3 rd Defendant are given as follows: a) Failing to act in good faith and with due diligence while acting for the Plaintiff/Purchaser in the transaction of sale herein referred to. b) Failing to divulge to the Plaintiff as his advocate in the transaction, the amount owed to the 1 st Defendant in order to ensure that the Purchaser Plaintiff was informed of the full amount that the 2nd Defendant owed the bank 1st Defendant in regard to the transaction ELC E009 OF 2022 5

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c) Aiding and favouring the Vendor being the 2nd Defendant herein in his cause of misrepresentation to the Plaintiff/Purchaser. d) Failing to exercise due diligence in acting as the Plaintiff's Advocate to inform him of the full extent of debt due to the 1st Defendant herein, 8. Upon being served with the plaint, and summons to enter appearance, the 1st Defendant filed a statement of Defence dated 6th April 2010 denying each and every allegation in the Amended plaint. 9. The 2nd Defendant filed a statement dated 22 nd March 2010. It is his case that the agreement with the Plaintiff was vitiated with fraud, duress and misrepresentation, and incapable of being enforced. 10. The 3rd Defendant filed a statement of Defence dated 23/3/2010. It is his case that his role was limited to drawing a sale agreement between the Plaintiff and the 2nd Defendant. He was to forwarded titles once released by the 1st Defendant. He prays that the suit against him be dismissed. EVIDENCE OF THE PLAINTIFF ELC E009 OF 2022 6

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11. PW1, George Gitau Wainaina the Plaintiff, testified on the 4th March 2024. He told the court that in the year 2007, he was looking for land to buy in Kitengela, Korompoi area. He stated that he got in touch with one Mr. Munyao who referred him to an estate agent by the name Joseph Ndegwa who informed him of two parcels that were being auctioned by a bank. They were; Kajiado/Kaputiei North /4302 and 4303 respectively. He was able to meet the registered owner, who is the 2nd Defendant in this suit. It appeared to the Plaintiff that the 1 st Defendant (the bank) had given the 2nd Defendant consent to sell the land by private treaty as the amount owing was Kshs1,400,000. 12. The Plaintiff told the court that a sale agreement was executed between himself and the 2nd Defendant. The purchase price for the two properties was Kshs5,000,000/= which he paid in full. The sale agreement was reduced into writing by the 3 rd Defendant, who acted for both the plaintiff and the 2 nd defendant. The 3rd Defendant forwarded the Kshs1,400,000/= to the Bank (1st Defendant) but only the title for Kajiado/Kaputiei North /4303 was released. The 1st Defendant informed the 3rd Defendant that the other title could only be released upon payment of Kshs3.150,000/=. As the 2nd Defendant could not pay this amount, the 1 st Defendant advertised the parcel; Kajiado/Kaputiei North /4302 for auction. ELC E009 OF 2022 7

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13. The Plaintiff adopted his witness statement dated 6 th May 2013 as his evidence in chief. He also produced the documents in the Bundle of Documents dated 21 st September 2015 as exhibits P1. He urged the court to find that the purported notice of sale dated 19 th January 2009 is null and void as the 1st Defendant had consented to the sale by private treaty. 14. When cross examined by Ms Amimo, counsel for the 1 st Defendant, he admitted that Kajiado/Kaputiei North /4303 was transferred to him. He also stated that the 1st Defendant was not a party to the sale agreement dated 15th November 2007 between himself and the 2nd Defendant. He was aware that the suit properties were charged to the 1 st Defendant (bank) and that he did not inquire of the outstanding loan from the bank. He stated that he paid Kshs5,000,000/= for the two parcels out of which Kshs1,400,000 was paid directly to the bank . 15. He told the court that the bank demanded Kshs1,700,000/= more which he offered to pay but the bank declined to accept He admitted that the bank had a right to exercise it’s statutory power of sale. 16. When cross examined by Mr. Wainaina for the 2 nd Defendant, he admitted that he knew the suit properties were charged to the bank. He stated that the 2 nd ELC E009 OF 2022 8

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Defendant signed the Application for consent to the Land Control Board in respect of Kajiado/Kaputiei North /4303. He also stated that the 2nd Defendant was acquitted of the criminal charge of obtaining money by false pretences. He denied that Mary Wanjohi his wife obtained some documents from the bank’s lawyers to enable him defraud the 2nd Defendant, He however admitted that she participated in drafting the transfer documents. 17. When cross examined by Mr Nderitu for the 3 rd Defendant, he stated that his claim against the 3 rd Defendant was costs. That this is because the 3 rd Defendant was to ensure he (Plaintiff) got transfer s of the parcels to his favour. He stated that he knew the parcels were up for auction from one Joseph Ndegwa and not the bank. He said he could not obtain consent from the bank as he was not the seller. He stated that the 3rd Defendant colluded with the 1st and 2nd Defendants to deny him the two parcels though he had no evidence of the collusion. He maintained that the 3rd Defendant was to ensure he got the titles in his name. 18. On re-examination, he confirmed that Kshs1.4 million was forwarded to the bank and the same acknowledged. He maintained that the 3rd Defendant had all the information. He later learnt that the bank was demanding Kshs3,150,000 more in order to release the two titles. He ELC E009 OF 2022 9

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stated that the 3rd Defendant’s mandate was extended to secure the discharge of charges. He said he had not interacted with the bank before the sale. He maintained that the 2nd Defendant applied for consent to the Land Control Board and executed all the documents in respect of Kajiado/Kaputiei North/4303. He stated that he did not appeal against the acquittal of the 2 nd Defendant as the case was prosecuted by the Office of Director of Public Prosecution. 19. PW2, Joseph Ndegwa Kamau, an estate agent adopted his witness statement dated 6th May 2013 as his evidence in chief. He confirmed that the Plaintiff and the 2 nd Defendant agreed on the sale of the two parcels for the purchase price of Kshs5 million. He stated that though the plaintiff paid the full purchase price he only got a title for one parcel. 20. When he was cross examined by Ms. Amimo for the 1 st Defendant, he stated that he knew the suit properties were for auction from M/s Garam Auctioneers . The same were to be sold by Public Auction. He stated that the 2 nd Defendant decided to sell by private treaty. He said KSHS1.4 million was owing to the bank though he did not visit the bank to get more information. He was paid Kshs575,000 as commission for the two parcels. He stated that the sale agreement was between the Plaintiff and the ELC E009 OF 2022 10

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2nd Defendant. He said the bank was also aware but he had no evidence. 21. When cross examined by Mr Wainaina for the 2 nd Defendant, he confirmed he got verbal instructions from the 2nd Defendant to market the suit properties in the year 2005. He stated that the 2nd Defendant was aware he had found a buyer while he (2nd Defendant) was in Congo. He said he showed them plaintiff the two parcels in the presence of Mr. Mc Donald Maina and that the 2 nd Defendant later came and showed then to the Plaintiff. He stated that they got some documents from M/s Garam Auctioneers but the 2nd Defendant confirmed that he owed the bank Kshs1.4 million. He stated that it was the plaintiff and the 2 nd Defendant ought to have confirmed the loan outstanding. He said he believed Ksh14 million was forwarded to the bank but declined to release the other title. He could not confirm if the sale agreement was stamped by the bank. 22. When cross examined by Mr Nderitu for the 3 rd Defendant, he stated that there was no representative from the bank when the sale agreement was drawn. He stated that they relied on the 3 rd Defendant and went ahead with the sale agreement. 23. On re-examination, he stated that he was not present when the 2nd Defendant took the Plaintiff to the land. ELC E009 OF 2022 11

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24. PW3, Mary Wanjohi Mungai adopted her witness statement dated 6th May 2012 as her evidence in chief. She stated that she has known the Plaintiff for many years and that he showed her the documents relating to the transaction. 25. When cross examined by Mr. Wainaina for the 2 nd Defendant, she stated that the Plaintiff consulted her on the documents. She said she took the transfers to the 2 nd Defendant for signing. She witnessed the 2 nd Defendant Sign the said documents. She admitted that in 2008, she worked with M/s Cheptumo & Co Advocates who were the bank’s lawyers at the time. She furthers stated that she was not an employee but would be paid commission on the clients she brought to the firm. She stated that she did not handle the files from the law firm but once held brief for an associate in Machakos Court. She stated that she got married to the plaintiff in the year 2011. She admitted that the consent from the Land Control Board was for the two parcels which she took for registration. She however stated that the Plaintiff did not consult her before he bought the suit properties. 26. When cross examined by Mr Nderitu for the 3 rd Defendant, She stated that she witnessed the transfers and effected registration of Kajiado/Kaputiei-North/4303. She stated that she did not know what the instructions of the 3 rd Defendant were. She was not present when the sale ELC E009 OF 2022 12

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agreement was drawn. At this juncture the plaintiff closed his case. EVIDENCE OF THE DEFENDANTS 27. DW1 Nelly Musau, a Credit Administrator Manager with the 1st Defendant, adopted her witness statement dated 25th February 2022 as her evidence in chief. She also produced the documents in the Bundle of Documents dated 25th February 2022 as exhibits D1 to D4 respectively. It was her testimony that the 1st Defendant was not a party to the sale agreement dated 15 th November 2007. She was not aware of the said sale Agreement. 28. She further stated that the suit property is still charged to the bank and the amount owing as at 28 th February 2014 is Kshs4,959,823/66. The 2nd Defendant is yet to clear the arrears hence it is not possible to discharge the charge in the Plaintiff’s favour. 29. She also stated that the borrower (2nd Defendant) was required to seek consent and authority from the bank in order to sell by private treaty. It was only then the bank would give conditions and the monies would be deposited directly to the bank. She maintained that the 2nd Defendant did not write to the bank prior to the sale agreement. 30. Where cross examined by Ms. Wadegu for the plaintiff, she stated that the bank did not allow the 2 nd Defendant to sell ELC E009 OF 2022 13

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by private treaty. She also confirmed that the 2 nd Defendant paid Kshs1,400,000 and the title for Kajiado/Kaputiei North /4303 was released to him. She denied that the plaintiff offered to clear the outstanding amount. 31. When cross for the 2 nd examined by Mr Wainaina Defendant, she denied that the bank arrangement with the 2nd Defendant was in any to sell by private treaty. She maintained that the bank was not aware of the sale agreement dated 15th November 2007 and that it became aware after the suit was filed. She confirmed that only one title was released. 32. On re-examination she stated that the title for Kajiado/Kaputiei North /4303 was released to the 2 nd Defendant. 33. DW2 Ephraim Wambu Miano, the 2nd Defendant testified on the 13th October 2025. He adopted his witness statement dated 8th March 2022 as his evidence in chief. He also produced the documents in the Bundle of Documents dated 8th March 2022 as exhibits D1 to D6 respectively. 34. When cross examined by Ms. Wadegu for the Plaintiff, he admitted that he signed the sale agreement dated 15 th November 2007. He stated that he was aware that the outstanding loan was more than Kshs1.4 million. He also confirmed that he released the title for Kajiado/Kaputiei ELC E009 OF 2022 14

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North /4303 to the Plaintiff. He stated that he received Kshs2.5 Million but he released Kshs1.4 Million to the bank. It was his testimony that the bank had authorized him to sell by private treaty. He stated that he negotiated with the bank who released only one title. He admitted that the Kshs5 million was for the two parcels. 35. When cross examined by Ms. Akonga for the bank he confirmed that he had no written consent from the bank to sell by private treaty. He also stated that the Plaintiff was aware the suit property was charged to the bank. He admitted that he owes the bank monies. 36. When cross examined by Mr. Nderitu for the 3 rd Defendant, he admitted that Mr. K Macharia Advocate acted on instructions from him and the Plaintiff. 37. On re-examination he stated that he requested the bank to sell the two parcels so that the amount could be realized. He reiterated that the sale agreement dated 15/11/2007 was subject to the charge by the bank. He also stated that he had not sought consent from the bank. He stated that the Plaintiff had all the details of the charge. He also stated that he has filed a suit against the Plaintiff as Kajiado/Kaputiei North /4303 was obtained fraudulently. 38. Mr. Nderitu for the 3rd Defendant told the court his client could not attend court. He then closed the 3 rd Defendants’ case. ELC E009 OF 2022 15

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39. At the close of the oral testimonies, parties tendered final written submissions THE PLAINTIFF’S SUBMISSIONS 40. They are dated 1st December 2025. Counsel submitted that the 1st Defendant having learnt that the 2nd defendant has already sold the two parcels of land to the Plaintiff, it was obvious that the person with an interest to redeem on the land was the Plaintiff and not the 2nd Defendant. 41. It is further submitted that the bank knew that a right of redemption accrued to the owner of the land and that the 2nd Defendant had ceased to be the owner of the land, the subject matter of this suit. Reliance is placed on the case of David Bundotich Vs Housing Finance Company of Kenya Limited HCCC No.24 of 2021 where the court stated thus;“ A sale destroys the equity of redemption in the mortgage’s property and constitutes the mortgagee’s exercising the power of sale as a trustee of the surplus proceeds of sale, if any, for the persons, interested according to priorities” 42. It is submitted that the bank could have transferred the charge upon the land Kajiado/Kaputiei North/4302 to the Plaintiff so that the Plaintiff would settle the default upon his land to enable the discharge of charge on the land by ELC E009 OF 2022 16

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the 1st Defendant and transfer the suit property to the Plaintiff. 43. Counsel also submitted that the 1st Defendant continued to plead privity of contract with the 2 nd Defendant when such privity had already ceased upon the 2 nd Defendant entering into the sale Agreement with the Plaintiff. That in essence the bank was colluding with the 2 nd Defendant to defraud the Plaintiff. 44. It is submitted that the Plaintiff purchased the suit property for valuable consideration, in good faith and without any defect in title. Reliance is placed on the case of Katende Vs Haridar & Co Ltd (2008); Sehmi & Another Vs Tarabana Co Ltd & 5 others. Further that the 1st Defendant as a financial institution, owed a duty of candour to ensure transparency in dealings involving charged property. 45. It is submitted that the Plaintiff had fulfilled his contractual obligation in full and remains’ ready to complete the transaction. Reliance is placed on the cases of Reliable Electrical Engineers Ltd Vs Mantrac Kenya Ltd (2006) eKLR; Peter Gitonga Vs Francis Mburu & Another (2014) eKLR. 46. Counsel submitted that the Plaintiff has demonstrated a prima facie case founded on a valid sale agreement and unlawful deprivation. The harm being the loss of ownership of land, cannot be adequately compensated by ELC E009 OF 2022 17

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damages. Reliance is placed on the cases of Giella Vs Cassman & Brown Nguruman Ltd Vs Co. Jan Ltd (1973) EA 358; Bonde Nielsen & 2 Others (2014) eKLR 47. It is submitted that the 1st Defendant’s threat to sell the Plaintiff’s property without authority is an act of unlawful interference akin to trespass. Reliance is placed on the case of Park Towers Ltd Vs Moses Chege & Others (2014) eKLR. 48. It is submitted that the 1st Defendants’ unlawful interference deprived the Plaintiff of possession and enjoyment of his property hence he had suffered prolonged loss and inconvenience due to the bank’s unjust actions. He is entitled to damages. Reliance is placed on the case of Moses Muriithi Vs National Bank of Kenya (2018) eKLR. He prays that the prayers in the Amended plaint be allowed. THE 1ST DEFENDANT’S SUBMISSIONS 49. As at the time of writing this judgment, the 1 st Defendant had not filed any written submissions. THE 2ND DEFENDANT’S SUBMISSIONS 50. They are dated 5th March 2026. They raise four issues for determination: (i) Whether the Plaintiff is entitled to the orders for injunction. ELC E009 OF 2022 18

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(ii) Whether the Plaintiff is the bona fide purchaser of the suit property. (iii) Whether the Plaintiff is entitled to orders for extension of time within which to make an application to the Land Control Board. (iv) Whether the Plaintiff is entitled to the orders for transfer of the suit property. 51. Counsel submitted that the 2nd Defendant is the owner of the suit property, the same remains charged to the 1 st Defendant the Plaintiff’s claims are subservient to those of the 1st Defendant. The Plaintiff is therefore not entitled to any order of injunction. 52. It is also submitted that the Plaintiff was aware that the suit property was charged to the 1 st Defendant. The Plaintiff did not write to the bank to get a formal communication regarding the sale and only lodged several complaints after the bank refused to release and discharge the title. Further that the plaintiff did not perform due diligence before the sale and therefore cannot be said to be a bonafide purchaser for value without notice. Reliance is placed on the case of Samuel Kamere Vs Land Registrar Kajiado (2015) eKLR. 53. It is submitted that the prayer for extension of time within which to make an application to the Land Control Board cannot be granted as the suit property is still charged to ELC E009 OF 2022 19

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the 1st Defendant and as such the intended or desired transfer would not be feasible. Reliance is placed on the case of Tendereni Vs Kiptoo & Another (2022) KEELC 4800 ( KLR). 54. Counsel also submitted that the Plaintiff is not entitled to the order sought as the suit property is still charged to the 1st Defendant. Further that the Particulars of fraud have not been proved. Reliance is placed on the case of Koinange & 13 Others Vs Charles Karuga Koinange (1986) eKLR; Vijay Morjaria Vs Nansingh Madhusingh Darbar & Another (2000) eKLR. 55. It is submitted that the Plaintiff cannot benefit from his own actions which were not only illegal but unlawful. He prays that the Plaintiff’s suit be dismissed with costs. THE 3RD DEFENDANT’S SUBMISSIONS They are dated 5th March 2026. They raise one issue for determination; whether the plaintiff is entitled to any orders against the 3rd Defendant. 56. Counsel submitted that the role of the 3 rd Defendant was to prepare the sale agreement between the Plaintiff and the 2nd Defendant dated 15th November 2007. That the said sale Agreement was subject to the balances due to the 1 st Defendant to be paid and a discharge of charge be executed prior to the completion date. ELC E009 OF 2022 20

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57. It is also submitted that the doctrine of innocent purchaser for value without notice applies to equitable interests and cannot displace legal interests, like the charge over the property by the 1st Defendant. Reliance is placed on the case of Sehmi & Another Vs Tarabana Company Limited & 5 others KESC 21 (KLR). 58. It is submitted that the 3 rd Defendant was not acting for the 1st Defendant in the transaction and that the Plaintiff would be required to liase with 1 st Defendant to ensure the full loan was paid and that the discharge of charge was executed. 59. It is submitted that as a purchaser, the Plaintiff was obligated by law to carry out through and comprehensive due diligence on the property subject to the sale transaction including written confirmation from the 1 st Defendant that it had authorized the sale of the property. 60. It is submitted that the 3rd Defendant’s role was to prepare the agreement on the terms agreed by the Plaintiff and the 2nd Defendant and to witness the same. He was not instructed by the Plaintiff and the 2nd Defendant to establish the correct balance’s due to the 1 st Defendant which inquiry would logically have preceded the preparation of the agreement for sale. 61. It is further submitted that the 3 rd Defendant executed his professional duties diligently as instructed by the Plaintiff ELC E009 OF 2022 21

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and the 2nd Defendant. He prays that the Plaintiffs suit be dismissed. ANALYSIS AND DETERMINATION 62. I have considered the pleadings, the evidence on record, the written submissions and the authorities cited. The issues for determination are:(i) Whether the Plaintiff is a bonafide purchaser for value without any notice (ii) Is he entitled to the reliefs sought on the Amended Plaint? (iii) Is he entitled to any orders against the 3 rd Defendant? (iv) Who should bear costs of the suit? 63. The undisputed facts are that the suit properties Kajiado/Kaputiei North/4302 & 4303 were charged to the 1st Defendant (hereinafter referred to as the “the bank” for some overdraft facility. 64. That by the sale agreement dated 15 th November 2007, the 2nd Defendant agreed to sell to the Plaintiff the two parcels for Kshs5,000,000/=. 65. The sale was subject to the charge held by the bank. This was as per clause 1(b) of the Agreement. As per the Distribution Agreement attached to the sale Agreement Kshs1,400,000/= was paid to the Bank (1st Defendant) ELC E009 OF 2022 22

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Kshs2,500,000 to the 2nd Defendant and Kshs 275,000 to Mr Macharia Advocate. The rest of the monies also went to the Agents. 66. The bank upon recovering the money discharged a charge over Kajiado/Kaputiei -North/4303 and released the title. The Plaintiff confirms he is the registered owner of this particular parcel. His issue is the other parcel Kajiado/Kaputiei -North /4302. 67. It is the Plaintiff’s case that the bank colluded with the 2 nd Defendant to deprive him of this parcel. The particulars of fraud against the 1st and 2nd Defendant are given in paragraph 17 of the Amended Plaint. In his testimony, he admitted that he was aware the suit property was charged to the bank. The onus was on him to prove that the bank was aware and or had consented to the sale by private treaty. 68. In my view the plaintiff has failed to demonstrate any collusion between the bank and the 2nd Defendant. In the case of Koinange & 13 others Vs Charles Karuga Koinange (1986) eKLR the court held as follows:"in arriving at my decision in this respect I have relied upon the principle enunciated in Ratilal Patel Vs Lalji Makanji (1957) EAR 314317; ELC E009 OF 2022 23

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"There is one observation which we must make -burden of proof standard is required allegations of fraud must be strictly proved, although that standard of proof may not be so heavy as to require proof beyond reasonable doubt. Something more than a balance of probabilities is required" 69. Similarly, in Vijay Morjaria Vs Nansingh Madhusingh Darbar & Another (2000) eKLR. Tunoi J (as he then was) stated thus; "It is also settled law that fraudulent conduct must be distinctly alleged and distinctly proved and it is not allowable to leave fraud to be inferred from "the facts" Also, in Teleposta Pension Scheme Registered Trustees Vs Intercountries Importers And Exporters Ltd & 4 others (2016) eKLR, the court held as follows:“ It is trite law that whoever alleges fraud must prove It was therefore incumbent upon the Plaintiff to prove. The fraud allegations against the Defendants to the required standard. The standard of proof in fraud cases is higher than in ordinary civil cases, it is higher than on a balance of probability….” ELC E009 OF 2022 24

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I am not satisfied that the particulars of fraud set out in the amended plaint have been proved at all. 70. The plaintiff admitted that the bank was not a party to the sale agreement dated 15th November 2007. In his witness statement dated 6th May 2013, he told the court that he learnt that the two suit properties were being advertised for auction from some broker. Infact at the time the 2 nd Defendant was not within the country and the broker took him to the suit properties. He further stated that somehow got some documents relating to the suit properties though it is not clear from who. This confirms the 2nd Defendant’s testimony that it is the Plaintiff who looked for him. 71. As a purchaser therefore, the Plaintiff ought to have done due diligence by confirming from the bank the sums outstanding. It is clear from the evidence tendered that he did not. The Plaintiff was aware that the suit properties he was purchasing were subject to a charge by the 1 st Defendant. He stated that he had obtained authority from the 1st Defendant to purchase the suit properties and only needed an agreement for sale from the 2nd Defendant. He however failed to produce the said authority if any before this court. ELC E009 OF 2022 25

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In my view the Plaintiff went about the sale agreement casually He has himself to blame for what has befallen him. 72. From the foregoing, can the Plaintiff be said to be bonafide purchaser for value without notice? The answer would be no. The Plaintiff was aware the suit property was charged to the bank. He did not bother to find out the outstanding amounts. He failed to do due diligence. 73. Under section 59 of the Land Registration Act the bank must give consent if it allows the chargor to dispose the security in order to realize the amounts owing. In such cases the sale agreement would have to be sent to the bank for consent and the purchase price is deposited in the bank to settle the charge, and the balance if any is paid to the chargor. This means any sale agreement only becomes valid if the bank gives its consent. I will not say much as to why the title for Kajiado/Kaputiei North/4303 was released to the 2nd Defendant. It could be because Kshs1,400,000/= had been deposited with the bank. 74. This notwithstanding the bank was not a party to the sale Agreement dated 15th November 2007. No evidence was tendered to show that it was aware of the said sale. The court of Appeal in Samuel Kamere Vs Land Registrar Kajiado (2015) eKLR stated as follows:- ELC E009 OF 2022 26

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“………..in order to be considered a bona fide purchaser for value, they must prove that they acquired a valid and legal title, secondly they carried out the necessary due diligence owner from to determine whom they the lawful acquired a legitimate title and thirdly that they paid valuable consideration for the purchase of the suit property. It is clear from the above description that the Plaintiff is not a bonafide purchaser for value without notice and cannot be protected by this court. 75. Having stated that the bank did not consent to the sale Agreement dated 15th November 2007, it cannot be bound by its terms thereof. In the case of Kenya National Capital Corporation Ltd Vs Albert Marco Corderio & Another (2014) KECA 775 (KLR) Visram JA observed thus; “……The 1st Respondent contends that the Appellant was “aware” of the funds paid to the 2nd Respondent. It is my considered view that the Appellant’s knowledge of the existence of the contract between the 1st Respondent and ELC E009 OF 2022 27

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the 2nd Respondent does not in effect make it party to the same.” I therefore find that there was no contract between the Appellant and the Respondent. Having established that the contract to purchase the house in question existed between the 1st Respondent and the 2nd Respondent, the next question for determination is whether the same was binding on the Appellant. In Agriculture Finance Corporation vs Longetia Ltd (1985) KLR at 770 the Court of Appeal held that: “As general rule a contract affects only the parties to it, and cannot be enforced by or against a person who is not a party, even if a contract is made for his benefit and purports to give him the right to sue or make him liable upon it. There existed no direct contract between the first Respondent and the Appellant, and so the first Respondent had no cause of action against the Appellant.” In the instant case the contract was directly between the 1st and the 2nd Respondent hence the Appellant was a stranger to the same. There being no direct contract between the Appellant and the 1 st Respondent herein, I do find that the Appellant is not bound by the contract ELC E009 OF 2022 28

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between the 1st Respondent and the 2nd Respondent hence the 1st Respondent had no cause of action against the Appellant”. H. M. Okwengu, JA while concurring with Visram JA stated thus: “……In my view, the enforcement of the Appellant’s statutory power of sale was a matter between the parties to the agreement that gave rise to the exercise of the statutory power of sale.” In this case the parties to that agreement were the 2nd Respondent and the Appellant. Therefore, it is only the 2nd Respondent who could question the improper exercise of the Appellant’s statutory powers, and not the 1st Respondent who was not party to the mortgage agreement. Indeed, the improper exercise of the statutory powers of sale, could not confer any rights on the 1 st Respondent. Such as the basis of specific performance of a separate contract to which the Appellant was not a party…” 76. The above findings speak to the instant case. The 1 st Defendant was not a party to the sale agreement dated 15th November, 2007 hence it is not bound to do anything. It ought to be allowed to go ahead and exercise it’s statutory power of sale in respect of Kajiado/Kaputiei North/4302 (the suit property). ELC E009 OF 2022 29

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The Plaintiff was aware the suit property was charged to the bank. I find that he is not entitled to the reliefs sought in the Amended plaint as against the bank. 77. It is also my view that the Plaintiff is not entitled to any order against the 3rd Defendant (the Advocate). His role was to prepare and witness the Sale Agreement dated 15 th November, 2007. He acted on the instructions of the Plaintiff and the 2nd Defendant. He had no role in procuring the release of the title from the bank. He was not acting for the 1st Defendant in the transaction. The Plaintiff was aware that certain monies were owing to the bank. In my view the 3rd Defendant acted professionally in execution of his duties and he is not to blame; he prepared and witnessed the sale agreement and he was paid. The case against the 3rd Defendant fails. 78. As regards the 2nd Defendant’s claim that the Plaintiff obtained the title to Kajiado/Kaputiei North/4303 fraudulently, I believe this could be a subject of separate proceedings. No evidence was led on this issue. 79. The 2nd Defendant admitted that he entered into the sale agreement dated 15th November, 2007 voluntarily. He received some monies from the Plaintiff to the tune of Kshs.5,000,000/=. I believe the Plaintiff is entitled to refund from the 2nd Defendant since it is not clear how much money was paid in respect of the suit property then ELC E009 OF 2022 30

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the parties would have to sit down and come up with a figure owing to the Plaintiff from the 2nd Defendant. 80. In essence the Plaintiff is not entitled to the reliefs sought the Amended Plaint except the refund from the 2 nd in Defendant. 81. In conclusion, I find that the Plaintiff has failed to prove his case as against the 1 st and the 3rd Defendants on a balance of probabilities. 82. The final disposal orders are:(a) The Plaintiff’s suit as against the 1st and 3rd Defendants is dismissed with costs. (b) The 2nd Defendant is hereby ordered to refund the sum received in respect of Kajiado/Kaputiei North/4302 to the Plaintiff with interest at court rates’ for the date of filing within ninety (90) days from the date of this judgment. Judgment dated, signed and delivered virtually at Nakuru this 24th day of September 2026. L KOMINGOI JUDGE IN THE PRESENCE OF:- ELC E009 OF 2022 31

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Ms. Wadegu for the Plaintiff Ms. Njagi for Ms. Akonga for the 1st Defendant Mr Wainaina for the 2nd Defendant. Mr. Nderitu for the 3rd Defendant Court Assistant : Irene/Derrick ELC E009 OF 2022 32

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