Joseph Nderitu Wanjohi v North Teru Farmers Co. Ltd, Peter Ndegwa Kamochu, John Gaitho Gatuguta, Wanyoike Njoori Gikuri, Joyce Njoki Mathenge, Daniel Gitonga Kimondo, Daniel Murage Nguitui, Charles Gichuhi Ngari, Eunice Muringi Kihia & Nancy Wangeci Maina [2021] KEELC 4083 (KLR)

REPUBLIC OF KENYA

IN THE ENVIRONMENT AND LAND COURT

AT NYERI

ELC CASE NO. 28 OF 2020

JOSEPH NDERITU WANJOHI.................................................................PLAINTIFF

-VERSUS-

NORTH TERU FARMERS CO. LTD.............................................1ST DEFENDANT

PETER  NDEGWA KAMOCHU................................................... 2ND DEFENDANT

JOHN GAITHO GATUGUTA.........................................................3RD DEFENDANT

WANYOIKE NJOORI GIKURI......................................................4TH DEFENDANT

JOYCE NJOKI MATHENGE..........................................................5TH DEFENDANT

DANIEL GITONGA KIMONDO....................................................6TH DEFENDANT

DANIEL MURAGE NGUITUI........................................................7TH DEFENDANT

CHARLES GICHUHI NGARI........................................................ 8TH DEFENDANT

EUNICE MURINGI KIHIA............................................................9TH DEFENDANT

NANCY WANGECI MAINA.........................................................10TH DEFENDANT

RULING

A.  INTRODUCTION

1. Vide  a  plaint  dated  30th  July,  2020  the  Plaintiff  sued  theDefendants seeking the following reliefs:

(a) An order of inhibition be issued inhibiting the registration of any dealings over all those parcels of land known and described as Title Numbers Nanyuki/Marura Block 5/132, 284, 266, 136, 210, 255, 124, 65, 13, 372, 417, 71, 23, 165, 87, 18, 44, 100, 74, 200, 111, 204, 91,178, 237, 130, 70, 63, 140, 227, 96, 226, 90, 180, 179, 199, 27 220 31, 37, 305, 416, 208, 127, 12, 24, 189, 117, 221, 83, 182, 174, 207, 247, 240, 5, 244, 419, 10, 2, 49, 202, 370, 108, 28, 164, 29, 157, 201, 80, 415, 97, 22, 223, 222, 264, 286, 25, 235, 42, 232, 39, 17, 241, 32, 15, 44, 303, 24, 79, 117, 84, 69, 260, 69, 420, 262, 256 &170 (ERERI) and the Land Registrar Laikipia County be directed to register the said inhibition against the aforesaid  parcels of land.

(b) Any other and further orders as this Honourable Court may deem just in the circumstance.

(c) Costs of the suit.

2. It was pleaded in the plaint that the Plaintiff was the founding director and shareholder of the 1st Defendant (the company) which was incorporated in 1971 and the only surviving director.  The Plaintiff further pleaded that he was the chairman of the board of directors of the company until 2014 when the 2nd – 10th Defendants (the Defendants) forcibly took over the operations of the company.

3. The Plaintiff contended that the Defendants were in the process of offering for sale and disposing of the suit properties belonging to the company whilst excluding the rightful beneficiaries including himself.  The Plaintiff was apprehensive that unless the reliefs sought were granted, the rightful beneficiaries of the suit properties shall suffer substantial and irreversible loss hence the suit.

B.  THE PLAINTIFF’S APPLICATION

4. Simultaneously with the filing of the suit the Plaintiff filed a notice of motion dated 30th July, 2020 brought under Section 68 of the Land  Registration  Act  2012,  Sections  1A,  1B and  3A  of  the  CivilProcedure Act (Cap. 21), Order 40 Rule 1 of the CivilProcedure Rules, Article 159 of the Constitution of Kenya, 2010andall enabling provisions of the lawseeking an order of inhibition prohibiting any further dealings with the suit properties pending the hearing and determination of the suit.

5. The said application was based on the grounds set out on the face of the motion which were essentially the same grounds set out in the plaint dated 30th July, 2020.  It was contended that the Defendants had illegally taken over the operations of the company and are in the process of advertising the suit properties for sale to members of the public to the detriment of the rightful shareholders and beneficiaries.  The application was supported by the Plaintiff’s own affidavit sworn on 30th July, 2020 which reiterated and expounded upon the grounds set out in the motion.

C.   THE DEFENDANTS’ RESPONSE

6. The 1st – 10th Defendants filed a replying affidavit sworn by John Gaitho Gatuguta on 17th August, 2020 in opposition to the said application.  It was contended that the Plaintiff and his leadershipteam were voted out by shareholders of the company on 24thJanuary, 2014 after which the new office bearers, the 2 – 10thDefendants, were duly registered by the Registrar of Companies. It was denied that the Defendants had forcibly or illegally taken over the management of the company.

7. The Defendants denied that they had offered for sale any of the suit properties to members of the public and challenged the Plaintiff to provide evidence thereof.  It was contended that since being voted out of office the Plaintiff had continued to masquerade as the chairman of the company and that he had sub-divided and sold some of the company properties after being voted out of office.

8. In particular, it was contended that the Plaintiff had sub-divided Title No. Nanyuki/Marura Block 5/1271 (ERERI) into two portions one of  which  he  transferred  to  his  wife  whereas  he  sold  the  other portion with the help of his daughter.  It is was further contended that as result of the Plaintiff’s said fraudulent action the Plaintiff  and  his  daughter  were  facing  criminal  charges  beforeMagistrates’ Court at Nanyuki.

9. The Defendants further stated that the Plaintiff was illegally operating a parallel company office at Nanyuki despite his ouster and that due to his illegal activities he had not come to court with clean hands hence he was entitled to the interim orders sought.  The court was consequently asked to dismiss the application with costs.

D.   DIRECTIONS ON SUBMISSIONS

10. When the application was listed for directions on 30th July, 2020 it was directed that the same shall be canvassed through written submissions.  The parties were also given timelines for filing responses and submissions.  The record shows that the Plaintiff filed his submissions on 2nd November, 2020 whereas the Defendants filed theirs on 5th February, 2021.

E.  THE ISSUES FOR DETERMINATION

11. The court has considered the Plaintiff’s notice of motion dated 30th July, 2020 together with the supporting affidavit and annexturesthereto, the Defendants’ replying affidavit in opposition thereto as well as the submissions on record.  The court is on the opinion that the following issues arise for determination herein:

(a) Whether the Plaintiff has made out a case for the grant of the order of inhibition.

(b) Who shall bear the costs of the suit.

F.   ANALYSIS AND DETERMINATION

(a)   Whether the Plaintiff has made out a case for the grant of an order of inhibition

12. The court has considered the material and submissions on record on this issue.  The application is essentially based upon Section 68(1) of the Land Registration Act, 2012which stipulates as follows:

“The court any make an order (hereinafter referred to as an inhibition) inhibiting for a particular time, or until the occurrence of a particular event, or generally until a further order, the registration of any dealing with any land, lease or charge”.

13. The Plaintiff  relied, inter alia, upon the case of Dorcas Muthoni and 2 others  v  Michael Ireri Ngari [2016] eKLR and Benson Mwaniki Njuki and 16 Others  v Henry Mkopo Nguta and 2 Others [2016] eKLR in support of the application.  It was submitted that an order of inhibition is akin to an order of temporary injunction intended to preserve the suit property pending resolution of a dispute at the trial.

14. The Defendants, on the other hand, submitted that the Plaintiff had failed to satisfy the requirements for granting the order of inhibition since he had not tendered evidence of intended sale or disposition of the suit properties.  The Defendants relied on the cases of Joseph Mumita Kipees (suing as legal representative of the estate of Moses Kisento)  v  Nteri Merik Obo Kipaika  and 2 Others [2014) eKLR and Stringer Mzungu Lumwe and Another v Shida Tuji Tsuma and 2 Others [2020) eKLR in opposition to the application..

15. The court has considered the material and submissions on record.  The court has noted that all the authorities cited by the parties require that an applicant must demonstrate good groundsto warrant the issuance of such an order.  The applicant must also demonstrate the risk of alienation or disposal of the suit property before the trial of the action.

16. In the case of Joseph Mumita Kipees (supra) it was held, inter alia, that:

“The Applicant has alleged that the 1st Defendant intends to sell the suit land.   There is no evidence of that allegation. Under Section 68(1) of the Land Registration Act, the court  has power to grant inhibition orders against a suit land restricting registration of any dealing with the suit land for a particular period or until the occurrence of a particular event.  The courts have severally held that in an application  for orders of inhibition the applicant has to satisfy the court that:

(a) That the suit property is at risk of being disposed off or alienated or transferred to the detriment of the applicant unless preservatory orders of inhibition are issued.

(b) That the refusal to grant orders of inhibition would render  the applicant’s  suit nugatory.

(c) That the applicant has an arguable case.”

17. The court has considered the material on record but it is far from satisfied that the Plaintiff has made out a good case for the grant of an order of inhibition.  The Plaintiff has completely failed to tender any evidence of intended sale or disposal of the suit properties.  On the contrary, the material on record shows that it was the Plaintiff who had sub-divided company property and attempted to alienate it after his ouster from office.  It would further appear that the Plaintiff is currently facing criminal charges in connection with such fraudulent dealings with company property.  It is noteworthy that the Plaintiff did not file any further or supplementary affidavit to respond to the issue of the alleged fraud and the criminal charges he is facing.

18. The court is also not satisfied that the 2 – 10th Defendants forcibly took over the management of the company as alleged by the Plaintiff.  The material on record indicates that the Defendants were elected and duly registered as office bearers by the Registrar of Companies.  The Registrar rejected the returns by the  Plaintiff  on  the  basis  that  his  meeting  was  not  properly

convened and accepted the Defendants’ registration as the duly elected officials.  It would thus appear that the Plaintiff was out to deliberately mislead the court on the alleged forcible takeover whereas he knew that the Registrar had accepted and endorsed the Defendants’ election.  Accordingly, the 1st issue is answered in the negative.

(b)   Who shall bear costs of the application

19. Although costs of an action or proceeding are at the discretion of the court, the general rule is that costs shall follow the event in accordance with the proviso to Section 27 of the Civil Procedure Act (Cap. 21).A successful party should ordinarily be awarded costs of an action unless the court, for good reason, directs otherwise.  See Hussein Janmohamed & Sons Vs Twentsche Overseas Trading Co. Ltd [1967] EA 287.  The court finds no good reason why the successful litigants should not be awarded costs of the application.  Accordingly, the Defendants shall be awarded costs of the application.

G.  CONCLUSION AND DISPOSAL

20. The upshot of the foregoing is that the court finds no merit in the Plaintiff’s notice of motion dated 30th July, 2020.  Accordingly, the same is hereby dismissed with costs to the 1st – 10th Defendants.

It is so ordered.

RULING DATED AND SIGNED IN CHAMBERS AT NYERI THIS 10TH DAY OF MARCH, 2021and delivered via Microsoft Teams platform in the presence of Mr. Magua for the Plaintiff and Ms Gichama holding brief for Mr. Wachira for the Defendants.

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HON. Y. M. ANGIMA

JUDGE