CASE BRIEF : Musk Deer Limited -vs- Benjamin K. Kipkurui & another [2018] eKLR

By Quincy Jesse Kiptoo LL.B. (Hons), CPM, Dip in Law

Prior to an incident that happened on 16^th June, 2007, Benjamin K. Kipkurui (1^st respondent) may have thought he was the absolute registered proprietor of a property comprised in a Title registered at the Lands Titles Registry, Mombasa as C.R. 21127.

Not before the Municipal Council of Mombasa (2^nd respondent) purported to send auctioneers to evict the 1^st respondent from the suit premises on account that the suit property had been sold to recover outstanding rates under the Rating Act Chief Magistrate’s Court in Civil Case Number 2094 of 2006 (Municipal Council of Mombasa –vs- Benjamin Kipkurui.

The property had been sold to a person referred to as Musk Deer Limited.

To understand what was happening, the 1^st respondent instructed an advocate who perused the said court file and to their utter consternation, they discovered proceedings were conducted wherein orders to sell their clients’ property were issued without his knowledge

The 1^st Respondent, Benjamin Kipkurui’s counsel made frantic efforts to set aside the ex parte judgment and subsequent orders vesting the suit property to the appellant without success.

The 1^st respondent decided to file a constitutional petition claiming that several of his fundamental rights were breached in the process of the purported sale of his property and the issuance of the vesting orders which he claimed was done without jurisdiction.

The 1^st Respondent challenged the constitutionality of the purported sale which was authorized by the subordinate court without following the laid down procedure.

He protested that by failing to follow the Constitution and the law when his property was purportedly sold, he was arbitrarily deprived of his property without a hearing;

He stated that he was not given a fair hearing nor subjected to a fair administrative action or given access to information of the sale of his property despite the fact that he was affected most by the said sale.

To demonstrate the blatant irregularities that attended the said sale, it was pointed out that the summonses were deliberately sent to the wrong address, a post office box in Mombasa which had never belonged to the 1st respondent.

MUSK DEER’S (PURCHASER’S OPPOSITION)

According to the Appellant, they came by an advertisement of a sale of the suit property by way of public auction in the Kenya Times daily newspaper of Saturday 24^th February, 2007.

The sale was scheduled for 16^th March, 2007, which they attended and bid for the suit property for a sum of Ksh. 15 million.

The appellant was declared the highest bidder and proceeded to pay the deposit and the balance of the purchase price after which they were given the vesting order and certificate of sale.

Subsequently, the Appellant contended that possession of the suit property was handed to it on the 16^th June, 2007. According to the appellant, it was an innocent purchaser for value without notice.

The matter fell for hearing before P.J. Otieno J., who after carefully analysing the material that was placed before court and the law, found there was a failure of justice because the 1^st respondent was not served with the demand notice, was not served with the court processes that was sent to the wrong address.

The Judge therefore held the purported sale arising out of the ex parte judgment was a nullity; that the 1^st respondent was arbitrarily deprived of his property rights; a proper title was not capable to vest upon the appellant due to obvious wrongs that were committed in the entire proceedings.

The Judge therefore allowed the petition as per the orders of 6^th December, 2016. Aggrieved by the Judge’s decision, the appellant filed an appeal.

Appellate Court found that:

It was crystal clear from the record that the 1^st respondent was not served with the court documents and a far-reaching judgement that ordered his property be sold in a public auction was made.

What more was required to support this illegality was when the advocate who conducted the proceedings and the sale by public auction admitted that the judgment that gave rise to the sale cannot lawfully stand.

The Court found the facts in this matter went to the core of the 1^st Respondent’s rights to fair administrative action which includes the right to an expeditious, efficient, lawful, reasonable and procedurally fair process.

The Court agreed with the trial Judge the 1^st Respondent’s complaints that he was not afforded a hearing that passed muster of the principles of natural justice that are so central in the administration of justice.

The often referred to Latin audi alteram partem rule (hear the other side) was breached.

They held that as per the provisions of Article 40 of the Constitution which guarantees protection of property, the 1^st Respondent as the registered owner of a property and being in possession thereof could not have been deprived of his property through a contrived process that appeared made to look legal

The second schedule of the Rating Act provides that the rates demand notice should be signed by either the Town Clerk or in his or her absence the Treasurer of the local Authority.

In the circumstances of the case, the 2^nd respondent had admitted that no such demand notice was issued, the purported service of summons was sent to the wrong address therefore the entire process was flawed and the subordinate court lacked jurisdiction to move an inch with the matter let alone to issue a vesting order of the suit premises.

The process undertaken by the 2^nd Respondent did not comply with the values of Article 10.

The last issue was whether the Judge erred by failing to find the appellant was an innocent purchaser for value of the suit premises without any notice of defect in the title.

The Court cast its legal lenses upon the events that unfolded after the so-called auction which was conducted on the 16^th March, 2007.

The Appellant was supposed to pay the balance of the purchase price and they were informed by the advocate acting for the 3^rd Respondent that it was supposed to pay the said balance by 15^th April, 2007 according to clause 7 of the conditions of sale that were relied on by the Appellant.

Despite the fact that it was a court initiated sale, the appellant varied the terms and conditions of sale without reference to the court; Also the advocate obtained a court order on the 19^th April, 2007 to confirm and make the appellant an absolute owner when it had not paid the balance of the purchase price while misrepresenting the balance had been paid.

It was noted that the balance was paid on 25^th April, 2007 after the property had been vested.

Another anomaly that occurred was an application made in the subordinate court on 5^th June, 2007 directing the Registrar of Title to issue a provisional title without following the laid down procedure in compliance with the provisions of Section 71 of the Registration of Titles Act (now repealed) which provides for gazette notice to issue for a certain period of time when a title is lost.

The Court wondered “Was the title truly lost; truth be told, it was with the 1^st respondent and it is for these reasons that one would wonder whether the appellant was truly oblivious of all candour that requires a party to carry out due diligence before entering into what turns out to be a murky deal; or was the appellant a complicit participant?”. “What happened to the common and obvious caution that “buyer beware?”. The Appellant did not demonstrate having carried out any due diligence whatsoever.

There was nothing in terms of a title to transfer to the appellant because a sale which was void cannot entitle the purchaser proprietorship his or her innocence notwithstanding.

The Court noted that the appellant may have fallen prey to fraudulent cartels that capitalize on depriving innocent Kenyans of their parcels of land.

The Appellate Court dismissed the Appeal.