Makori & another v Cooperative Marchant Bank Ltd & another (Civil Appeal (Application) 37 of 2018) [2025] KECA 2194 (KLR) (28 November 2025) (Ruling)
Neutral citation:
[2025] KECA 2194 (KLR)
Republic of Kenya
Civil Appeal (Application) 37 of 2018
MS Asike-Makhandia, HA Omondi & AO Muchelule, JJA
November 28, 2025
Between
Bernard Gesora Makori
1st Applicant
Kepha Onduko Makori
2nd Applicant
and
Cooperative Marchant Bank Ltd
1st Respondent
Emerg Investment Limited
2nd Respondent
(Being an application under the inherent and residual jurisdiction of the Court of Appeal to review/vary/set aside the judgment and consequential orders of the Environment and Land Court at Kisii (J.M. Mutungi, J.) dated 10th November 2017 in ELC Case No. 686 of 2016 (Formerly HCC No. 16 of 2012
Environment & Land Case 16 of 2012
)
Ruling
1.The background of this application is that, the 1st appellant, Bernard Gesora Makori, obtained a loan of Kshs.8,000,000/= from the 1st respondent, the Cooperative Merchant Bank Ltd. On the basis that the loan had not been serviced as agreed, the 1st respondent moved to exercise its statutory power of sale. The 1st applicant, seeking to protect the property that had secured the loan, entered into agreement to sell it to the 2nd applicant, Kepha Onduko Makori, and a 10% payment of Kshs.1,000,000/= was made. In the meantime, the 1st respondent sold the property to the 2nd respondent, Emerg Investment Limited, for Kshs.10,000,000/= which was paid in full and the property was transferred. The sale was by private treaty, as opposed to public auction.
2.The applicants sued the respondents at the Environment and Land Court at Kisii, alleging that the sale by the 1st respondent to the 2nd respondent was fraudulent and illegal on various grounds:- that the 1st respondent had not issued to the applicants the statutory notice of sale; the sale had been at an undervalued price; the transaction had not received the blessings by the Land Control Board; and that, in any event, the property was not free for sale there having been a prior agreement for sale between the applicants.
3.The respondents defended the claim.
4.The trial court heard the parties and did not find merit in the case by the applicants, which was dismissed with costs to the respondent.
5.The applicants were aggrieved by the decision and filed an appeal to this Court. This Court (Karanja, Gatembu, & J. Mohammed, JJ.A.) heard the appeal which they dismissed with costs to the respondent on 18th June 2021.
6.By way of motion dated 28th July 2021 under Rules 1(2), 42(1) and 47 of the Court of Appeal Rules, 2010 and Article 159 of the Constitution, the applicants returned to this Court seeking to invoke its residual jurisdiction to review its judgment delivered on 18th June 2021 and overturn the finding that the suit was res judicata. They further asked this Court to review the holding that the respondent’s exercise of statutory power of sale was regular.
7.In the grounds and supporting affidavit, the applicants stated that since no further appeal was available to them, their only remedy was the review of the decision. They sought to demonstrate that, on the questions of res-judicata and the validity of the statutory power of sale, there was apparent error on the face of the record as the Court had misinterpreted the facts and the law and misdirected itself on the same which had led to injustice. It was contended that there was evidence to show that the 1st respondent had irregularly exercised its power of sale which was sufficient to nullify the sale to the 2nd respondent.
8.Further, this Court had confirmed the finding by the trial court that, in view of Kisumu HCCC No. 362 of 2000, Nairobi HCCC No. 1149 of 1998, Kericho HCCC No. 84 of 1999 and Kisii HCCC No. 451 of 1997, the claim was res judicata. However, according to the applicants, this Court was wrong, as the full facts of the matter and the cited cases had not been fully appreciated.
9.The 1st respondent opposed the application. It was averred that the application did not meet the requirements for review, as there was no error apparent on the face of the record, and no new evidence had been provided. It was contended that the Court had not erred in finding that the suit was res judicata, and so on.
10.Learned counsel Mr. Edwin Waudo and Mr. Eugene Labulellah argued the application on behalf of the applicants while learned counsel Mr. Kyalo Mbobu argued on behalf of the 1st respondent. Learned counsel Mr. Bundotich was present for the 2nd respondent. Counsel highlighted their written submissions.
11.One of the issues that learned counsel for the applicants pointed out was that when the 1st respondent transferred the suit property to the 2nd respondent on 27th April 2006, there was in place a status quo order that had been issued on 19th April 2006 in HCCC No. 1534 of 2005, and therefore when this Court held that such order did not exist, that was an error. It was further argued that finding that the owner of the suit property, Johnson Makori Onduko, had died by the time of the sale was not correct as he died on 3rd March 2007. The agreement between the applicants had therefore not lapsed as had been found.
12.In opposing the application, learned counsel Mr. Kyalo Mbobu argued that the applicants had not met the threshold for review. Learned counsel Mr. Bundotich was of the same view. It was, however, acknowledged that the appellants cannot appeal the decision of this Court.
13.This Court has inherent jurisdiction to review its decisions to prevent injustice or abuse of the process of the Court (see Standard Chartered Financial Services Ltd & 2 Others -vs- Manchester Outfitters (Suiting Division) Limited (Now known as King Woollen Mills Limited & 2 Others [2016] eKLR). But as was observed in Kamau James Gitutho & 3 Others -vs- Multiple ICD (K) Limited & Another [2019] KECA 379 (KLR):
14.In the decision of Fredrick Otieno Outa -vs- Jared Odoyo Okello & 3 Others [2017] eKLR, the Supreme Court identified the exceptional circumstances where the Court, in exercise of its inherent powers, may, upon application of party, or on its own motion, review, any of its judgments, rulings or orders, so as to meet the ends of justice. The circumstances shall be limited to situations where:-i.the judgment, ruling, or order, is obtained, by fraud or deceit; orii.the judgment, ruling, or order, is a nullity, such as, when the Court itself was not competent; oriii.the Court was misled into giving a judgment, ruling or order, under a mistaken belief that the parties had consented to it; oriv.the judgment, ruling or order, was rendered, on the basis of a repealed law, or as a result of a deliberately concealed statutory provision.
15.Lastly, this Court in Benjoh Amalgamated Limited -vs- Kenya Commercial Bank Limited & Another [2024] KECA 593 (KLR) reaffirmed that:-
16.Having considered the application, the affidavit in support, the response and the rival submissions, we wish to determine whether the applicants have made a compelling and exceptional case that invites this Court, by its residual power, to review the judgment that was delivered on 18th June 2021.
17.We reiterate that the judgment which the applicants seek to have reviewed was in relation to an appeal against the impugned judgment of the superior court delivered on 11th November 2017. In that appeal, the applicants contended that the sale of the suit property by the 1st respondent to the 2nd respondent was irregular, unlawful and improper. There was failure to serve the mandatory statutory notice of sale to the 2nd respondent, which unprocedurally fettered the 1st applicant’s right to redeem the suit property. It was further contended that the charge registered against the suit property was null and void as it had not been signed and therefore infringed on the provisions of section 69 of the Indian Transfer of Property Act (now repealed) and section 46 of Registration of Titles Act (now repealed). Further, that the 1st respondent failed to serve a notification of sale to the 1st applicant as was required by law; that the sale of the suit property by the 1st respondent was subject to the consent of the Land Control Board, which was not obtained; that the sale of the suit property should have been by public auction, but was by private treaty; that the property was undervalued in the sale; and that the sale was concluded between 6th October 2005 and 27th April 2006 when there was in force court orders restraining any dealing in the property.
18.A look at the judgment by this Court clearly reveals that it considered all these grounds of appeal and returned a verdict on each against the applicants and in favour of the respondents. The Court further considered the finding by the trial court that the applicants’ suit was res judicata and found that no error on the part of the trial court had been disclosed.
19.In our view, the judgment of this Court was not obtained through fraud or deceit. It was not a nullity. It was not rendered based on repealed law. The applicants simply did not agree with the Court on the various conclusions reached during its re-evaluation of the evidence, while exercising its jurisdiction as the first appellate court. We reiterate that, while this Court can use the residual power of review to correct significant errors of law or process that result in a miscarriage of justice and undermines the credibility of the judicial process, it cannot invoke the power to re-litigate the merits of a case or to address issues that should be handled through the normal appellate process. Grounds that would normally form the basis of an appeal, including any perceived misapprehension of the facts or law, would not be suitable grounds that would attract the exercise of residual jurisdiction or review.
20.Consequently, we find no merit in this application which we dismiss with costs to the respondents.
DATED AND DELIVERED AT KISUMU THIS 28TH DAY OF NOVEMBER, 2025.ASIKE - MAKHANDIA........................................JUDGE OF APPEALH. A. OMONDI........................................JUDGE OF APPEALA.O. MUCHELULE........................................JUDGE OF APPEALI certify that this is a true copy of the original.SignedDEPUTY REGISTRAR