Supreme Court over-turned a Court of Appeal’s landmark decision in Wilson Ndolo Ayah case and found Inconsistencies in certain provisions of the Advocates Act
National Bank of Kenya Ltd vs Anaj Warehousing Ltd
Petition No. 36 of 2014
Supreme Court of Kenya
Mutunga, CJ & P; Tunoi, Ibrahim, Ojwang, Wanjala, SCJJ
December 2, 2015
Reported by Kipkemoi Sang


Download the Decision
Issues:
  1. Whether a document or instrument of conveyance was null and void for all purposes, on ground that it was prepared, attested and executed by an advocate who did not have a current practising certificate, within the meaning of Section 34 (1) (a) of the Advocates Act.
  2. Whether the inconsistencies found in the provisions of the Advocates Act required law reform
  3. Whether the ratio decidendi in Wilson Ndolo Ayah case which invalidated legal documents prepared by a non-qualified person still stood and was a pertinent criterion for resolving the instant matter
  4. Whether the case involved matters of general public importance

Conveyancing Law -validity of conveyancing documents- prepared by and advocate who has no valid practicing certificate- Whether a document or instrument of conveyance was null and void for all purposes, on ground that it was prepared, attested and executed by an advocate who did not have a current practising certificate, within the meaning of the Advocates Act-Advocates Act, Section 34 (1) (a)

Statutes-Advocates Act-inconsistency of provisions of the Advocates Act- Whether the inconsistencies found in the provisions of the Advocates Act that required a law reform-Advocates Act, sections, 2, 9, 12 and 13

Constitutional Law-matters of general public importance- Whether the case involved matters of general public importance-Constitution of Kenya, 2010, article 163 (4) (b)

Advocates Act (Cap 16, Laws of Kenya)
Section 2 Interpretation

“Advocate” means any person whose name is duly entered upon the Roll of Advocates or upon the Roll of Advocates having the rank of Senior Counsel and, for the purposes of Part IX, includes any person mentioned in section 10;

“Senior Counsel” means an advocate upon whom the President has conferred the rank of Senior Counsel;

Section 9-Qualifications for practising as an advocate

Subject to this Act, no person shall be qualified to act as an advocate unless—

(a) he has been admitted as an advocate; and
(b)
his name is for the time being on the Roll; and
(c)
he has in force a practising certificate;
(d)
deleted by Act No. 9 of 2000, s. 57,

and for the purpose of this Act a practising certificate shall be deemed not to be in force at any time while he is suspended by virtue of section 27 or by an order under section 60(4).

Section 10- Certain officers entitled to act as advocates
Each of the following persons shall, if he holds one of the qualifications specified in paragraphs (a), (b) and (c) of section 13(1) at the time of his appointment to his office, be entitled in connection with the duties of his office to act as an advocate, and shall not to that extent be deemed to be an unqualified person, that is to say—

(a) an officer in the office of the Attorney-General or the office of the Director of Public Prosecutions;
(b)
the Principal Registrar of Titles and any Registrar of Titles; or
(c)
any person holding office in a local authority established under the Local Government Act, (Cap. 265)
(d)
such other person, being a public officer or an officer in a public corporation, as the Attorney-General may, by notice in the Gazette, specify:

Provided that the officers referred to in this section shall not be entitled to charge fees for so acting.

Section 12- Qualification for admission as advocate
Subject to this Act, no person shall be admitted as an advocate unless—

(a) he is a citizen of Kenya, Rwanda, Burundi, Uganda or Tanzania; and
(b)
he is duly qualified in accordance with section 13.

Section 13- Professional and academic qualifications
(1) A person shall be duly qualified if—

(a) having passed the relevant examinations of any recognized university in Kenya he holds, or has become eligible for the conferment of, a degree in law of that university; or
(b)
having passed the relevant examinations of such university, university college or other institution as the Council of Legal Education may from time to time approve, he holds, or has become eligible for conferment of, a degree in law in the grant of that university, university college or institution which the Council may in each particular case approve; and thereafter both—

(i) he has attended as a pupil and received from an advocate of such class as may be prescribed, instruction in the proper business, practice and employment of an advocate, and has attended such course or tuition as may be prescribed for a period which in the aggregate including such instruction, does not exceed eighteen months; and
(ii) he has passed such examinations as the Council of Legal Education may prescribe; or

(c) he possesses any other qualifications which are acceptable to and recognized by the Council of Legal Education;
(d) he is an Advocate for the time being of the High Court of Uganda, the High Court of Rwanda, the High Court of Burundi or the High Court of Tanzania;
(e) he is for the time being admitted as an advocate of the superior court of a country within the Commonwealth and—

(i) has practised as such in that country for a period of not less than five years; and
(ii) is a member in good standing of the relevant professional body in that country:

Provided that the Council may, in addition, require that a person to whom this paragraph applies undergo such training, for a period not exceeding three months, as the Council may prescribe for the purpose of adapting to the practice of law in Kenya.

(2) The Council of Legal Education may exempt any person from any or all of the requirements prescribed for the purposes of paragraph (i) or paragraph (ii) of subsection (1) upon such conditions, if any, as the Council may impose.

Section 34- Unqualified person not to prepare certain documents or instruments

(1) No unqualified person shall, either directly or indirectly, take instructions or draw or prepare any document or instrument—

(a) relating to the conveyancing of property; or
(b)
for, or in relation to, the formation of any limited liability company, whether private or public; or
(c)
for, or in relation to, an agreement of partnership or the dissolution thereof; or
(d)
for the purpose of filing or opposing a grant of probate or letters of administration; or
(e)
for which a fee is prescribed by any order made by the Chief Justice under section 44; or
(f)
relating to any other legal proceedings; nor shall any such person accept or receive, directly or indirectly, any fee, gain or reward for the taking of any such instruction or for the drawing or preparation of any such document or instrument:

Provided that this subsection shall not apply to—
  1. any public officer drawing or preparing documents or instruments in the course of his duty; or
  2. any person employed by an advocate and acting within the scope of that employment; or
  3. any person employed merely to engross any document or instrument.

(2) Any money received by an unqualified person in contravention of this section may be recovered by the person by whom the same was paid as a civil debt recoverable summarily.
(3) Any person who contravenes subsection (1) shall be guilty of an offence.
(4) This section shall not apply to—

(a) a will or other testamentary instrument; or
(b)
a transfer of stock or shares containing no trust or limitation thereof.”

Held:
  1. The decision by the Appellate Court in Wilson Ndolo Ayah case was based on certain fundamental assumptions that; the phrase “an unqualified person” was synonymous with “an advocate without a current practising certificate”. On the face of section 34(1) of the Advocates Act, the assumption was not without merit, especially taking into account the provisions of section 2 of that Act, which defined “an unqualified person” as “a person not qualified under section 9 of Act as an advocate”. Section 9 of the Advocates Act in turn provided that; no person should be qualified to act as an advocate unless
    1. he had been admitted as an advocate;
    2. his name was for the time being on the Roll; and
    3. he had in force a practicing certificate.
  2. To convey their full import, the provisions ought to be read together with others in the same statute. Section 2 of the Act also defined an “advocate”, as “any person whose name was duly entered upon the Roll of Advocates, or upon the Roll of Advocates having the rank of “Senior Counsel” and included any person mentioned in section 10. Section 10 made no mention of a practising certificate. Sections 12 and 13 of the Advocates Act on the other hand, were devoted to the qualifications for being admitted as an advocate and were both academic and professional.
  3. While section 34 (1) of the Advocates Act forbade an unqualified person from indirectly or directly taking instructions, or drawing any document relating to the conveyancing of property, it exempted from that prohibition, any person who was employed by an advocate and who was acting within the scope of that employment. Such a state of uncertainty flowed from either, the intelligence of draftsman-ship; or equivocation in the expression of parliamentary intent.
  4. The Appellate Court’s second assumption in Wilson Ndolo Ayah case, was that section 34(1) of the Advocates Act had the effect of rendering all instruments of conveyance prepared by advocates without current practising certificates, null and void for all purposes. It was at the moment clear that such an assumption was not based on any express or implied meaning of section 34, or other provisions of the Advocates Act. In the reasoning of the Appellate Court, the ground for invalidating such documents rested in public policy: citizens should obey the broad intent of the law of the land; and Courts should enforce the law of the land, and deter acts of illegality. Within context, and by the terms of the constitutional law, the Courts were under obligation to resolve live disputes on questions that were governed by quite specific propositions of law.
  5. The main objective of section 34, prohibited unqualified persons from preparing certain documents. It was directed at “unqualified persons”. It prescribed clear sanctions against those who transgress the prohibition. The sanctions prescribed were both civil and criminal in nature. But the law was silent as to the effect of documents prepared by advocates not holding current practising certificates. The illegality was the assumption of the task of preparing the conveyancing documents, by the advocate, and not the seeking and receiving of services from that advocate. Likewise, a financial institution that called upon any advocate from among its established panel to execute a conveyance, commited no offence if it turned out that the advocate did not possess a current practising certificate at the time he or she prepared the conveyance documents. The spectre of illegality lies squarely upon the advocate, and ought not to be apportioned to the client.
  6. Section 34 of the Advocates Act, did not invalidate all documents prepared by an advocate who lacked a current practising certificate. Equally, section 19 of the Stamp Duty Act did not, provide a basis for invalidating the instruments in question, it only sought to render inadmissible for purposes of evidence, all documents which were unstamped. The question before the Court was not the admissibility in evidence, of unstamped documents, but rather the validity of instruments (which indeed were stamped) prepared by an advocate who lacked a current practising certificate.
  7. Even as stare decisis assured orderly and systematic approaches to dispute resolution, the common law retained its inherent flexibility, which empowered the Court, as the custodian of justice under the Constitution, to proceed on a case-by-case basis, invoking and applying equitable principles in relation to every dispute coming up. Precedent (such as that in Wilson Ndolo Ayah case), was to be perceived, in general, as the “announced rule”; but in the quest for justice in the context of a particular case such as the instant case, there was a basis for departing therefrom.
  8. Because the Courts normally use announced rules as their starting points, as a practical matter the deciding court was likely to have a limited number of salient choices in dealing with a precedent. It could accept and apply the announced rule; it could determine that, on close inspection the announced rule was not relevant; or it could use a minimalist or result-centred technique to reformulate or radically reconstruct the announced rule, and then apply or distinguish the rule it so established.
  9. In Wilson Ndolo Ayah case, monies belonging to the appellant were held by the Respondent, and it was held to be irrecoverable, just on the policy ground that the Courts ought to be seen to deter illegality. The illegality stemmed from the fact that the conveyance was prepared by an advocate who at the material time, did not hold a current practising certificate. However, such illegality, parliament did not intend that section 34 of the Advocates Act perpetrate an injustice. The injustice, indeed, multiplied, and subsumed the plane of public interest, in view of the fact that the monies in question were drawn from a public financial institution. Therefore, the case involved matters of general public importance, within the meaning of Article 163 (4) (b) of the Constitution since the Court of Appeal had certified it as such.
  10. In the instant case, the monies lent were in conformity with the provisions of the law, save that the relevant conveyancing instruments were drawn by an advocate who at the time did not hold a practising certificate, if they were not recoverable, it would be to sanction unjust enrichment for unscrupulous borrowers, while depriving innocent lenders creating a wide scope for fraudulent borrowing. Such a position in law did not represent an “announced rule” – precedent that should guide the disposal of the instant matter. Just as the law frowns upon unscrupulous lenders, especially those whose actions would fetter the borrower’s equity of redemption, so also should it frown upon unscrupulous borrowers, whose actions would extinguish the lender’s right to realize his or her security. There was to be, in law, a substantial parity of rights-claims, as between the lender and the borrower
  11. The Appellate Court made the assumption that, since the Law Society of Kenya did publish annually a list of names of duly-licensed advocates, the public would know if a particular advocate had not taken out a practising certificate. The assumption represented not by far reality for the typical client seeking a particular service, and founds a well-known advocate conducting his work from decent chambers. Judicial notice ought to be taken that even the judges in court, could hardly keep up with the records of advocates who had duly renewed their practice certificates. It was the Law Society of Kenya which was best placed to know which advocate had or had not taken out a practising certificate
  12. One of the bases of the Appellate Court’s decision was founded upon a hypothesis which should not be the criterion for resolving the question as to the rights of the parties: that since the Advocates Act provided for the recovery of fees by a client whose advocate had not taken out a practising certificate, there would be no harm if the charge documents were annulled. For even if the appellant were to recover any fees paid, it stood to be damnified by the non-repayment of the loan itself.
  13. The Court’s obligation coincided with the constitutional guarantee of access to justice as was in article 48 of the Constitution, and in that regard, required the fulfilment of the contractual intention of the parties. It was clear that the parties had intended to enter into a binding agreement, pursuant to which money was lent and borrowed, on the security of a charge instrument. It could not be right in law, to defeat that clear intention, merely on the technical consideration that the advocate who drew the formal document lacked a current practising certificate. The guiding principle was to be found in article 159(2)(d) of the Constitution which affirmed that justice should be administered without undue regard to procedural technicalities.
  14. To invalidate an otherwise binding contractual obligation on the basis of a precedent, or rule of common law even if such course of action would subvert fundamental rights and freedoms of individuals would run contrary to the values of the Constitution as enshrined in article 40 as regards the protection against arbitrary legislative deprivation of a person’s property of whatever description, article 20 (3) (a) and (b) as regards interpretation that favoured the development and enforcement of fundamental rights and freedoms and article 10 on values and principles of governance. The proper direction in law, that, no instrument or document of conveyance becomes invalid under section 34(1)(a) of the Advocates Act, only by dint of it having been prepared by an advocate who at the time was not holding a current practising certificate. The contrary effect was that documents prepared by other categories of unqualified persons, such as non-advocates, or advocates whose names had been struck off the roll of advocates, should be void for all purposes.
  15. While securing the rights of the client whose agreement had been formalised by an advocate not holding a current practising certificate, such advocate’s obligations under the law remained unaffected. Such advocate remained liable in any applicable criminal or civil proceedings, as well as any disciplinary proceedings to which he or she could be subject.
  16. The instant case involved matters of general public importance, within the meaning of article 163 (4) (b) of the Constitution since the Court of Appeal had certified it as such. There were inconsistencies in the Advocates Act and as such, the Judgement of the Court commended was attention-ed to parliament, the Law Society and the Attorney General for appropriate legislative action to address the inconsistencies in the Act.
Petition allowed.
The Judgment of the Court of Appeal dated 27th February, 2014 set aside.
Costs of the instant appeal to be borne by the respondent


Kenya Law
Case Updates Issue 038/2015
Case Summaries

COMPANY LAW Legal threshold which must be met in order to obtain leave of the court to sue on behalf of the company

Amin Akberali Manji & 2 others vs. Altaf Abdulrasul Dadani & another
Civil Appeal No. 101 of 2014
Court of Appeal at Nairobi
Waki, GBM Kariuki & Ouko JJA
September 25, 2015
Reported by Kipkemoi Sang

Download the Decision

Brief Facts:
The appellant and the respondent formed the company (ML) together in 1993, with the main object of importing and selling musical instruments. Each of them had 50% share and directorship in the company. The respondent controlled the day today operation of the company while the appellant took charge of financial matters. All was well with the company until 1999 when the appellant chose to resign from office of directorship and nominated another (Kamur), who continued his role of financial controller and another nominee (Madhani) to whom he transferred all his shares to hold in trust. He nevertheless continued to participate actively in the management of the company’s affairs.
In May 2000 the appellant allegedly refused to release money for purposes of replenishing stock and payment of creditors thereby paralyzing the company’s business. The respondent felt frustrated and the operations of the company ground to a halt. The respondent claimed that the appellant had incorporated another company (MML) which had a deceptively similar name as ML, expropriated the stock and assets of ML, and started operations of similar business in the premises of ML in conjunction with Kumar (his nominee) hence breaching fiduciary duty towards ML and that in cahoots with his nominee they intended to defraud not only ML but also the creditors of ML and the respondent. The respondent moved to court seeking leave to prosecute the suit of derivative action on behalf of ML and its creditors and indemnity by ML for all the cost and expenses reasonably incurred in prosecution. The appellant reacted to the allegation and appealed against the decision of the High court which had inter alia declared that the closure of ML was unlawful and wrongful, it had temporary injunction restraining MML from carrying on business in ML’s premises and compelled the appellant to furnish ML with audited reports. The orders of the High court to which the appellant objected included the question of leave before instituting a derivative.

Issues:

  1. Whether the instant case met the legal threshold of a derivative action at the trial stage and if so, whether the High Court erred in granting order to allow the plaintiff to be indemnified for all the expenses incurred in respect of the suit
  2. Whether the commencement of the case prior to obtaining leave of the court was fatal to the case
  3. Whether the High Court acted judiciously in the exercise of its discretion to issue the orders it did at an interlocutory stage

Company Law-derivative claims and or action-legal threshold for derivative action - derivative claims in the absence of minority shareholders- circumstances for necessary derivative actions in the absence of minority shareholders-Whether the instant case met the legal threshold of a derivative action at the trial stage and if so, whether the High Court erred in granting order to allow the plaintiff to be indemnified for all the expenses incurred in respect of the suit-Companies Act (cap 486)

Civil Practice & Procedure- leave of court-procedure for filling leave of court to sue the company- effect of clear procedure for filing leave of court to sue the company and or delivery claims-Whether the commencement of the case prior to obtaining leave of the court was fatal to the case- Whether the High Court acted judiciously in the exercise of its discretion to issue the orders it did at an interlocutory stage-In the matter of CMC Holdings Limited [2012]eKLR Civil Procedure Act (cap 21), section 3A Read More...

Held:

  1. The legal threshold which must be met in order to obtain leave of the court to sue on behalf of the company are:
    1. The aggrieved company has a cause of action, which means a “legal right that has been violated”
    2. That it is impossible for the company to sue on its own to redress the wrong or breach. Especially if the wrongdoers themselves are the directors or majority shareholders in the company and will not allow it to file suit against themselves or where there was no majority shareholding which could overrule the directors, it would be impossible to institute the suit in the name of the company, if the director fail to do so.
    3. The representative has locus standi or legal standing as a major shareholder, to commence the suit.
  2. A majority shareholder is one who “owns less than half the total shares.” The respondent who held half or 50% of the shares of ML was not a minority shareholder; he in fact had equal voting right with the appellant. It was not open for the respondent to institute a derivative suit citing the appellant (Manji or Kamur) as director, if they were in control of the company. The respondent simply had no locus standi in the instant matter.
  3. A derivative action was an American term amounting to one more than a ‘representative suit’ filed on behalf of a plaintiff (in other instances) under disability, like a minor or person or unsound mind. In the instant context, it was a suit instituted by shareholder on behalf of the company as its representative when the company itself could not sue. In the alternative if the suit was a derivative one, it required leave but none was sought or granted before the suit was filed as spelt out in the Companies Act.
  4. There was no express provision in Kenyan company laws to govern the procedure for granting leave to mount a derivative action. The procedure that was available was the English Common Law. Leave of the court should be obtained before filling a derivative suit, but could also be obtained to continue with the suit once filed. The crucial requirement was for the applicant to establish a prima facie case demonstrating that he had locus standi to institute an action, the company was entitled to the intended relief and that the action fell within any of the exceptions to the rule in Foss vs Habottle
  5. The rule in Foss vs Harbottle (the rule) established two principles. That of “proper plaintiff” and that of “the majority” where the first rule required that a wrong done to the company may be vindicated by the company alone and the second principle required that if the alleged wrong could be confirmed or ratified by a simple majority then a shareholder was barred from bringing actions. The principle effect in the rule is to bar action by minority shareholders. However, the exception to the rule in Habottle included: firstly, where what had been done amounts to fraud and the wrongdoers were themselves in control of the company, secondly; where it was alleged that personal rights of the plaintiff shareholder had been or were about to be infringed and thirdly, any other case where the interest of justice required that the general rule required suits by company to be disregarded.
  6. Where no application for leave was filed or where one was filled long after the suit was filed, different considerations would apply. The application for leave to continue with the suit filed in the instant matter was not made long after the suit was filed. Both were filed contemporaneously and were placed before a judge on the same day under the certificate of urgency and as such was heard ex parte. Owing to the need for the trial court to exercise discretion, equitable principles were applicable and ought to be exercised judiciously which the trial court observed on the basis of the prima facie case. The trial court was right in exercising the discretion to maintain the leave granted and to give the parties the opportunity to contest the real issues in controversy in the main suit.
  7. A derivative claim was necessary to rescue the company if it was truly in distress. In the instant case, there was apparent threat and mischief. Equally, there was nothing that could prevent any party from making an application to have the ex parte orders. The company was in a peculiar and unique position of having only two members who were equal in power and glory in relation to the company. There was no majority or minority shareholder. The two shareholders/directors had reached a stalemate. The property of the company was disappearing or being taken over by a third party but the company was doing nothing about it.
  1. Orders made by the High Court on the application dated 26th November, 2002 seeking to have the defence filed stack out and judgement on the prayers made by the appellant set aside.
  2. The Ruling and other orders of the High Court made on 5th April 2004 were otherwise upheld
  3. Each party to bear its own costs of the appeal and of the motions before the High Court
LAND LAW Applicability of the doctrine of lis pendens to the grant of injunctions in land disputes

Naftali Ruthi Kinyua v Patrick Thuita Gachure & another
Civil Appeal Number 44 of 2014
Court of Appeal at Nairobi
R N Nambuye, D K Musinga & A K Murgor, JJA
March 6, 2015
Reported by Beryl A. Ikamari and Robai Nasike Sivikhe

Download the Decision

Brief facts:
The appellant sued the 1st and 2nd respondent at the high court as proprietors of a parcel of Land known as Land Reference No. 8285/1522 also known as Plot No. 133 Kariobangi Light Industries, Nairobi. The appellant had purchased the suit property from Peter Muthaura on July 5th 1979 and subsequently notified the 2nd respondent about the purchase. He paid stand premiums, survey and conveyancing fees as demanded by the respondent in order to secure the title documents. The appellant was issued with a deed plan in respect of the suit property on August 9th 2011.
While waiting for issuance of the title documents, he discovered that the 1st respondent had entered the suit property and was commencing developments in the property. The 1st respondent had also acquired the relevant documents in relation to the land from the 2nd Respondent and was in the process of acquiring title documents.
In the course of proceedings, the appellant sought an injunction pending hearing and determination of the suit. The appellant argued that he had a prima facie case. His case was based on documentation which showed that he had purchased the property from Peter Muthaura and paid the relevant fee to the 2nd Respondent. Furthermore, as the lawful allottee of the suit property since 1980, he alleged that he would suffer irreparable harm and the balance of convenience tilted in his favor.
Additionally, the appellant contended that the principle of first in time was applicable since his claim dated back to 1980 while the 2nd respondent’s claim arose in 2011. Further, the appellant cited the doctrine of lis pendens under section 52 of the Transfer of Properties Act, 1882, of India (ITPA) as relevant for purposes of preservation of the suit property pending hearing and determination of the suit. However, the high court declined to issue an injunction.
The appellant appealed against the ruling on grounds that both the appellant and respondent did not have a perfected title and therefore an injunction should have been issued to preserve the suit property. It was further contended that injunctive orders restraining further dealings with the suit property should have been issued on the basis of the doctrine of lis pendens.

Issues:

  1. Whether the application met the legal threshold required for the grant of an injunction.
  2. Whether the doctrine of lis pendens was applicable to land disputes and the grant of an injunction given that the Indian Transfer of Property Act had been repealed.

Land Law-lis pendens- application of the doctrine of lis pendens - whether the doctrine of lis pendens still applied despite repeal of ITPA- whether the doctrine of lis pendens could be applied by court for preservation of property pending hearing and determination of a suit- whether the trial court had misdirected itself when it failed to consider and apply the doctrine of lis pendens- Transfer of Property Act, 1882, of India, section 52; Land Registration Act, No of 2012, section 107 (1).

Common Law- lis pendens- doctrine of lis pendens as a common law doctrine- relevance of common law to the application of doctrine of lis pendens - whether the doctrine of lis pendens, as a common law doctrine, could be applied to the preservation of property pending hearing and determination of a suit concerning the property- whether the trial court had misdirected itself when it failed to consider and apply the doctrine of lis pendens- Judicature Act, (Cap 8), section 3(1).

Civil Practice and Procedure- injunctions- interlocutory injunctions- principles applicable to the grant of an injunction - whether the appellant had met the stipulated conditions for the grant of an injunction- whether the trial court had misdirected itself when it declined to grant the appellant an injunction on grounds that he failed to establish a prima facie case with chances of success. Read More...

The Transfer of Property Act, 1882, of India
Section 52

52. Transfer of property pending suit relating thereto
During the active prosecution in any Court having authority in British India, or established beyond the limits of British India by the Governor-General in Council, of a contentious suit or proceeding in which any right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein, except under the authority of the Court and on such terms as it may impose.

Land Registration Act, No. of 2012, Laws of Kenya
Section 107 (1)

107. Savings and transitional provisions with respect to rights, actions, dispositions
(1) Unless the contrary is specifically provided for in this Act, any right, interest, title, power, or obligation acquired, accrued, established, coming into force or exercisable before the commencement of this Act shall continue to be governed by the law applicable to it immediately prior to the commencement of this Act.

Judicature Act, Cap 8, Laws of Kenya
Section 3 (1)

3. Mode of exercise of jurisdiction
(1) The jurisdiction of the High Court, the Court of Appeal and of all subordinate courts shall be exercised in conformity with—
(a) the Constitution;
(b) subject thereto, all other written laws, including the Acts of Parliament of the United Kingdom cited in Part I of the Schedule to this Act, modified in accordance with Part II of that Schedule;
(c) subject thereto and so far as those written laws do not extend or apply, the substance of the common law, the doctrines of equity and the statutes of general application in force in England on the 12th August, 1897, and the procedure and practice observed in courts of justice in England at that date:
Provided that the said common law, doctrines of equity and statutes of general application shall apply so far only as the circumstances of Kenya and its inhabitants permit and subject to such qualifications as those circumstances may render necessary.

Held:

  1. For an injunction to be granted, an applicant had to satisfy the court that he had established the existence of a prima facie case with chances of success and that he would to suffer irreparable loss which would not be compensated by an award of damages but in case the court was in doubt, the application was to be determined on a balance of convenience.
  2. The appellant had to establish that he had a prima facie case with chances of success. Therefore, the appellant had to show that he owned the suit property, or had a valid claim that was capable of defeating a claim by a third party in respect of the property in dispute.
  3. It was clear that both the appellant and 1st respondent were not in possession of title documents over the property, hence the dispute between the parties was a contest over who had a superior claim over the other. In light of those factors, it was incumbent upon the parties to produce relevant documents to support their claim over the suit property to the exclusion of the other.
  4. The appellant’s documents showed that he attempted to register his interest before the 1st respondent sought to register his. There was sufficient documentation that indicated that the appellant maintained a claim in respect of the suit property which was valid and continued to subsist. Hence, it was evident that the appellant had established a prima facie case with chances of success.
  5. The appellant was the lawful allottee to the suit property from 1980. He stood to suffer irreparable harm if the defendant was not restrained from taking over the suit property pending the hearing and determination of the suit.
  6. In case there was doubt that the appellant established a prima facie case and stood to suffer irreparable loss, the application ought to have been determined on a balance of convenience. The balance of convenience tilted towards the preservation of the property pending hearing and determination of the suit. That could only be accomplished by granting the orders of injunction.
  7. The doctrine of lis pendens was applicable to the circumstances as the case concerned a property dispute in which rights to the suit property were in contention. The doctrine was therefore of relevance to the application for an injunction.
  8. With the repeal of the ITPA by the Land Registration Act (LRA), which provided for the doctrine of lis pendens, the question of applicability of the doctrine of lis pendens arose. However, the applicability of the doctrine had to be considered in light of section 107 (1) of the Land Registration Act which provided for transitional provisions.
  9. Section 107 (1) of the Land Registration Act allowed for the continued applicability of rights and interests as provided for in legislation that governed titles and rights to property acquired prior to the repeal of such legislation. Hence, rights that flowed from section 52 of the ITPA, including the doctrine of lis pendens were to be recognized by virtue of section 107 (1) of the Land Registration Act.
  10. The doctrine of lis pendens was also a common law principle. Common law was applicable in Kenya by virtue of section 3 (1) of the Judicature Act. Therefore, the doctrine of lis pendens was part of the Kenyan law under section 3(1) of the Judicature Act.
  11. The trial court should not have disregarded the adjudicative support of the doctrine of lis pendens for purposes of preservation of the suit property until the suit was heard and determined. The trial court had erred when it failed to consider and apply the doctrine of lis pendens for purposes of the injunctive relief sought.
  12. The high court misdirected itself when it declined to grant an injunction and concluded that a prima facie case had not been established. The dispute involved competing interests between the appellant and respondent and on the basis of existing documentation, the appellant had established the existence a prima facie case.
  13. The high court misdirected itself when it failed to consider the doctrine of lis pendens for purposes of preserving the suit property pending hearing and determination of the suit.

Appeal allowed.
Ruling delivered by the high court on May 17th 2013 set aside.

JURISDICTION

The Wildlife Conservation and Management Act 2013 is the guide in determining awards for damages for death, or injuries caused by wildlife.

Joseph Munyoki Kalonzo v Kenya Wildlife Services
High Court of Kenya at Garissa
Civil case 5 of 2014
October 12, 2015
G. Dulu J
Reported by Njeri Githang’a and John Ribia

Download the Decision

Brief facts:
The plaintiff was the father of the deceased who was alleged to have been fatally injured by a crocodile while she fetched water at Tana River in Tseikuru District. The plaintiff sued the defendant as the legal representative of the estate of M M. The plaintiff sought compensation in the sum of Kshs. 5,000,000/= as provided under section 25 of the Wildlife Conservation & Management Act 2013. The plaintiff also sought special damages, costs and interest.
The defendant relied upon the doctrine of volenti non fit injuria and stated that the accident, if it occurred, was caused by the negligence of the deceased and the plaintiff. The defendants also pleaded that the suit was bad in law and did not disclose any cause of action. Through a preliminary objection, the defendant moved the court to have the suit struck out with costs and interest.
The plaintiff admitted partial liability and subsequently the parties counsel filed a written consent. The consent distributed liability at the ratio of 80:20 in favour of the plaintiff.

Issues:

  1. Whether the court had the jurisdiction to determine a claim for compensation for injuries or death caused by wildlife when section 25(1) of the Wildlife Conservation and Management Act 2013 had established a commission to deal with the same.
  2. Whether the Fatal Accidents Act and the Law Reform Act could be used to determine an award for damages for deaths and injuries caused by wildlife.
  3. Whether the Wildlife Conservation and Management Act 2013 was the guide in determining awards for damages for death, or injuries caused by wildlife.

Jurisdiction – the jurisdiction to determine a claim for compensation for injuries or death caused by wildlife- jurisdiction of the High Court vis a vis jurisdiction of the County Wildlife Conservation and Compensation Committee - whether the court had the jurisdiction to determine a claim for compensation for injuries or death caused by wildlife when section 25 (1) of the Wildlife Conservation and Management Act 2013 established a commission to deal with the same - Wildlife Conservation and Management Act 2013, section 25 (1).

Tort Law– damages- award of damages for loss of life- compensation-award for damages for deathor injuries caused by wildlife- whether the Fatal Accidents Act and the Law Reform Act could be used to determine an award for damages for deaths and injuries caused by wildlife - whether the Wildlife Conservation and Management Act 2013 was the guide in determining awards for damages for death, or injuries caused by wildlife- wildlife Conservation and Management Act 2013 section 25 (1) Read More...

Wildlife Conservation and Management Act 2013, section 25 (1)

(1) Where any person suffers any bodily injury or is killed by any wildlife listed under the Third Schedule, the person injured, or in the case of a deceased person, the personal representative or successor or assign, may launch a claim to the County Wildlife Conservation and Compensation Committee within the jurisdiction established under this Act.

Held:

  1. A suit that disclosed no cause of action was not similar to a suit that claimed a court did not have jurisdiction. Jurisdiction is the legal power of the court to hear and determine a matter. Cause of action dealt with whether the plaintiff or litigant had a legal claim which he could pursue in court. The defence did not challenge the power of the court to adjudicate over the matter, but challenged the ability of the plaintiff to sustain the claim. The defence did not raise an issue of jurisdiction.
  2. Section 25 (1) of the Wildlife Conservation and Management Act 2013 that stated that persons injured or the personal representatives of persons killed by wildlife could launch compensation claims to the County Wildlife Conservation and Compensation Committee was permissive. It used the word may, it did not specifically claim that the ordinary courts had no jurisdiction in such claims. The court had jurisdiction to determine the matter.
  3. The preliminary objection raised by the defense could not satisfy requirements for a preliminary objection. The preliminary objection was filed late on the hearing date without prior notice and it did not specify the sections or section of the Wildlife Conservation and Management Act 2013 that were violated by the proceedings, nor did it indicate the nature of the alleged violation which could amount to an abuse of court process.
  4. The consent entered into by the parties counsel with regard to liability was a proper recorded consent and as such it was contractual and binding on all parties and their counsel. The defendant took up 80% liability and the plaintiff took up 20% liability.
  5. The plaintiff was entitled to compensation under the Wildlife Conservation and Management Act 2013, which was the specific Act that dealt with accidents and fatalities associated with wildlife conservation. Since the Act was also a more recent law and since Parliament had in its wisdom decided to treat damage, injuries and deaths caused by wildlife differently, the act was the guide in determining awards for damages for death, or injuries caused by wildlife. The general law under the Fatal Accidents Act and Law Reform Act could not be used to determine damages as Parliament had made specific provision for the same under the Wildlife Conservation and Management Act of 2013.
  6. It was proved that the deceased died due to a crocodile attack, as such Kshs. 5,000,000/= was awardable to her estate as damages as compensation, as provided under section 25 of the Wildlife Conservation and Management Act 2013. The plaintiff also proved special damages of Kshs. 40,000/= for costs of litigation to obtain letters of administration. Subject to calculations varied by the consent entered into by the parties counsel, the plaintiff was entitled to Kshs. 4,032,000/= as compensation to the estate of the deceased.

Costs, interest and damages awarded to the plaintiff in the sum of Kshs. 4,032,000/=

LAND LAW Presumption of tenancy in common where the land register does not indicate whether the land is held jointly or in common

Moses Bii v Kericho District Land Registrar and 2 others
Civil suit No.8 of 2014
High Court at Kericho
October 2, 2015
Munyao Sila, J
Report by Teddy Musiga and Daniel Hadoto

Download the Decision

Brief facts:
The suit land was first registered in 1970 under the names of four persons, namely, Kiprono Bii, Moses Bii (the plaintiff), John Bii, and Cheriro Tuimising. As at the time of the hearing, the title deed had never been issued to them. In the course of time, John Bii and Kiprono Bii died. The plaintiff contended that despite their death, the Kericho District Land Registrar had failed to register their death certificates and refused to delete their names from the register, although he had been duly notified. The plaintiff prayed that the names of Kiprono Bii and John Bii to be deleted from the register and a title deed be issued in the names of himself and Cheriro Tuimising as joint proprietors of the suit property.

Issue:

  1. What happens where a property was registered in the name of several proprietors but there was no indication as to whether they held the property jointly or in common?

Land Law - Tenancy - Proprietorship of land - joint proprietorship and proprietorship in common – registration of more than one name but not indicating the nature of proprietorship – rule in determining form of proprietorship where more than one name is registered but there is no indication of the nature of proprietorship – The Land Registration Act, Act No. 3 of 2012 Section 91 (8); Registered Land Act, section 101 (1); 102, 103(repealed) Read More...

Section 101 (1) of Registered Land Act, Cap 300, (Repealed)

An instrument made in favor of two or more persons, and the registration giving effect to it, shall show-

(a) Whether those persons are joint proprietors or proprietors in common; and
(b) Where they are proprietors in common, the share of each proprietor.

Section 102 of the Registered Land Act (Repealed)
(1) Where the land, lease or charge is owned jointly, no proprietor is entitled to any separate share in the land, and consequently –

(a) dispositions may be made only by all the joint proprietors; and
(b) on the death of a joint proprietor, his interest shall vest in the surviving proprietor or the surviving proprietors jointly.

(2) For avoidance of doubt, it is hereby declared that -

(a) the sole proprietor of any land, lease or charge may transfer the same to himself and another person jointly; and
(b) a joint proprietor of any land, lease or charge may transfer his interest therein to all the other proprietors.

(3) Joint proprietors, not being trustees, may execute an instrument in the prescribed form signifying that they agree to sever the joint proprietorship, and the severance shall be completed by registration of the joint proprietors as proprietors in common and by filing the instrument.

Section 103 of the Registered Land Act (Repealed)

(1) Where any land, lease or charge is owned in common, each proprietor shall be entitled to an undivided share in the whole, and on the death of a proprietor his share shall be administered as part of his estate.
(2) No proprietor in common shall deal with his undivided share in favour of any person other than another proprietor in common of the same land, except with the consent in writing of the remaining proprietor or proprietors of the land, but such consent shall not be unreasonably withheld.

Section 91 (8) of the Land Registration Act, Act No. 3 of 2012

On and after the effective date, except with leave of a court, the only joint tenancy that shall be capable of being created shall be between spouses, and any joint tenancy other than that between spouses that is purported to be created without the leave of a court shall take effect as a tenancy in common.

Held:

  1. Section 101(1) of the Registered Land Act, Cap 300, (repealed) provided that in every situation where the proprietors were more than one, the register had to reflect whether their registration was joint or in common. The RLA did not envisage a situation where there were several proprietors, without it being disclosed in the register, whether they are joint proprietors or proprietors in common. Section 102 and 103 of the Registered Land Act (repealed) gave the characteristics of the two kinds of proprietorship (joint properties or proprietors in common).
  2. Where proprietorship was joint, the persons did not have any separate shares in the land, and therefore if one proprietor died, his interest automatically vested upon the surviving proprietor. Thus if land was owned jointly by A and B, and A dies, B now becomes the sole proprietor of the land and did not hold it in trust for the estate of A. There were no separate shares for the proprietors.
  3. Where land was owned in common, each proprietor had a separate share, only that the same was undivided and held together with the other proprietor/s as one whole. Thus if one proprietor died, his share did not vest in the surviving proprietor, but vests in his estate.
  4. In the instant case, the register did not show whether the proprietorship was joint or in common. The RLA did not contemplate a scenario where the register did not indicate whether land was held jointly or in common, and did not provide for the course to follow where there were several proprietors but no indication as to whether they held the land jointly or in common. If the register did not reflect whether land was held jointly or in common, the fallback position would be to presume that the land was held in common. Joint proprietorship, where the same had not been explicitly indicated, would only be presumed in the clearest of circumstances, where there could be no shred of doubt that the contemplation of the parties was to have the property held jointly.
  5. The current law, which was contained in the Land Registration Act, Act No. 3 of 2012 (which repealed the RLA and which came into effect on 2 May 2012) in fact frowned deeply on joint proprietorship. It effectively banned them unless the proprietors were spouses or unless by order of court. The operative section was Section 91 (8).
  6. In the instant case, the proprietors were four brothers. They became registered as proprietors on 16th February, 1970. The register did not show whether they were proprietors in common or whether they are joint proprietors. The courts presumption was that they were registered as proprietors in common. In fact, the nature of their holding fortified that position. The four persons were first registered proprietors. This view, pointed at a holding, which tended to be a holding in common, rather than one which was joint
  7. The Land Registrar could not be faulted for failing to presume that the proprietorship was joint, and for failing to issue a title deed only bearing the names of the surviving proprietors. It could be said that the Land Registrar was correct in registering a restriction, barring any dealings, until the interest of the survivors of one of the deceased proprietors is catered for.
  8. The suit was filed on 22nd February 2014, at a time when the Registered Land Act had been repealed at a time when Section 91 (8) of the Land Registration Act, was effective. In essence, if the new law was applied, the plaintiff automatically failed. But it didn’t matter, for even on application of the old law, the plaintiff would still fail.

Proprietorship was deemed to be a proprietorship in common.

Suit dismissed with costs
JURISDICTION Jurisdiction of the Supreme Court to review Court of Appeal decisions on certification that an intended appeal involved matters of general public importance

P M Wamae & Co Advocates v Hon Ntoitha M'mithiaru
Civil Application No 48 of 2014
Supreme Court of Kenya at Nairobi
K H Rawal DCJ & VP, P K Tunoi, J B Ojwang, S C Wanjala & S N Ndungu, SC JJ
October 19, 2015
Reported by Beryl A Ikamari

Download the Decision

Brief facts:
The Applicant represented the Respondent in Ntoitha M’mithiaru v Maoka Maore & 2 others, Election Petition No. 1 of 2003, High Court at Meru. When the case was concluded the Applicant presented a fee note for taxation to the Deputy Registrar, as the Taxing Master. The Bill was taxed at Ksh. 3, 236,343.68/=
The Respondent challenged the taxation at the High Court. The grounds on which the taxation was challenged included an allegation that the Applicant was a NARC Party volunteer who via a letter dated March 20, 2003, agreed to take Ksh. 400,000, for conducting the hearing on condition that if the Petition was successful, the Applicant would be entitled to receive the balance of their fees from the costs to be recovered. It was also the Respondent's contention that the Applicant was estopped from filing a Bill of Costs against him. The High Court dismissed the reference while stating that the letter did not meet the provisions of Section 45 (1)(b) of the Advocates Act (Cap 16.)
On a further appeal to the Court of Appeal, the High Court decision was overturned and the Court of Appeal held that the Applicant was bound by the representations made in the letter dated March 20, 2003. For purposes of lodging a further appeal at the Supreme Court, the Applicant sought certification that the matter was of general public importance. The Court of Appeal declined to grant the certification and elaborated that the dispute between the parties was a private one. At the Supreme Court, the Applicant sought a review of the Court of Appeal decision on certification.

Issues:

  1. Whether the Supreme Court had jurisdiction to entertain the review application.
  2. Whether the intended appeal involved matters of general public importance.

Jurisdiction-jurisdiction of the Supreme Court-certification that an intended appeal involved matters of general public importance-whether the Supreme Court had jurisdiction to review a Court of Appeal decision which entailed a denial of the requisite certification.

Jurisdiction-jurisdiction of the Supreme Court-certification that an intended appeal involved matters of general public importance-circumstances in which a matter would be found to transcend the circumstances of the case and to have a bearing on public interest-whether a dispute between an advocate and client over fees owed and representations made by the advocate on fees due, was a dispute involving matters of general public importance-Constitution of Kenya, 2010, article 163(5). Read More...

Held:

  1. The jurisdiction of the Supreme Court to review applications for certification under article 163(5) of the Constitution was to be harmonized with the Constitution. Access to justice was one of the fundamental rights recognized in the Constitution and all litigants were to be accorded an equal right to access the Court. Therefore a party could approach the Supreme Court for a review of a decision granting leave (certification) or denying leave (certification.)
  2. Whether a matter was one that involved issues of general public importance was a question to be determined on a case by case basis. Among the principles applicable to such a question was that the matter needed to be one that transcended the circumstances of the particular case and had a significant bearing on public interest.
  3. The matter in issue was a dispute between an advocate and a client over the fees owed to the advocate, wherein an advocate made representations in a letter and sought to rely on legal provisions in order to avoid the representations. It was not a general question on whether advocates fees could be based on unexecuted agreements. It was therefore not a matter that transcended the circumstances of the case.
  4. The Applicant framed the issues arising from the matter as issues relating to whether the common law doctrine of estoppel could be applied retrospectively, the circumstances in which common law principles may take precedence over written law and whether the Court of Appeal was a Court of record, in light of the provisions of Articles 162(1) and 163(7) of the Constitution. However, the record did not indicate that the issue on the common law doctrine of estoppel was determined by the Court of Appeal. A finding was not made as that was not one of the issues brought before the Court for determination. The Supreme Court as an appellate Court could not exercise jurisdiction over such an issue.

Application dismissed. (Court of Appeal ruling affirmed.)