Official Receiver & Liquidator of Continental Credit Finance Limited & Kisauni Properties Limited v Zaverchand Ramji Shah, Registrar of Titles, Government Land Registry Nairobi, Jared Benson Kangwana, Sheikh Salim Mohammed Balala, Theofilo Muchiri, Peter Miriie Zakayo, Lawrence M Mbaabu t/a L M Mbaabu & Co Advocates, Susan Salma Schiele, White Meg Industries Limited & M Khoda Investments Limited [2018] KEHC 8620 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA

CIVIL SUIT NO. 3462 OF 1995

OFFICIAL RECEIVER & LIQUIDATOR OF

CONTINENTAL CREDIT FINANCE LIMITED......................................................1ST PLAINTIFF

KISAUNI PROPERTIES LIMITED...........................................................................2ND PLAINTIFF

VERSUS

ZAVERCHAND RAMJI SHAH................................................................................1ST DEFENDANT

REGISTRAR OF TITLES, GOVERNMENT LAND REGISTRY NAIROBI...2ND  DEFENDANT

JARED BENSON KANGWANA.............................................................................3RD  DEFENDANT

SHEIKH SALIM MOHAMMED BALALA..........................................................4TH  DEFENDANT

THEOFILO MUCHIRI............................................................................................5TH  DEFENDANT

PETER MIRIIE ZAKAYO......................................................................................6TH  DEFENDANT

LAWRENCE M. MBAABU T/A

L.M. MBAABU & CO ADVOCATES....................................................................7TH  DEFENDANT

AND

SUSAN SALMA SCHIELE.....................1ST PROPOSED INTEREESTED PARTY/APPLICANT

WHITE MEG INDUSTRIES LIMITED..........................2ND PROPOSED INTERESTED PARTY

M.KHODA INVESTMENTS LIMITED..........................3RD PROPOSED INTERESTED PARTY

RULING

1) On 8th May 2015, this court delivered its ruing over other prayers save for prayers 4, 6, 6 and 7 of the motion dated 8. 11. 2011.  This court declined to make a determination on the aforesaid prayers to enable the parties decide on whether or not to allow the participation of the 3rd and 4th defendants.  Eventually, the 1st, 3rd, 4th, 5th and 6th defendants filed their submissions whereof they sought for the dismissal of the aforesaid motion.

2) I have considered the grounds stated on the face of the motion dated 8th November 2011 and the written submissions.  It is noted from the outset that the Hon. Attorney General who appeared for the 2nd and 7th defendants did not respond to the motion dated 8. 11. 2011.  In the motion dated 8. 11. 2011, the  applicant sought for the following orders inter alia:

1. ...........................

2. ...........................

3. ..................................

4. THAT the consent order recorded in this suit on 9th August 2010,the court order dated 11th August 2010 ensuing therefrom and the subsequent vesting order issued by this court on 25th January 2011 to give effect to the said consent orders in as far as they relate to the parcel of land known as LR. 4242/42 be and rare hereby set aside.

5. THAT the 1st Defendant and the 2nd and 3rd Interested Parties be and are hereby restrained by themselves , their servants, agents or by any person claiming under or through them from disposing off and/or interfering in any manner whatsoever with the 1st Interested Party’s/applicant’s  quiet possession of LR No 4242/42 Nairobi and all the improvements thereon.

6. THAT the 2nd Defendant do expunge from the lands record all entries in the Lands Register for the parcel of land known as LR. NO.4242/42 subsequent to the Vesting order issued by this court on 25th January 2011 and reinstate all the entries existing on the Lands register for the said parcel of land prior thereto.

7. THAT pending the hearing  and determination of this application, this honourable court be pleased to issue an interim order of injunction in terms of prayer 5 hereinabove.

3) In this court’s ruling of 8. 5.2015, it was noted that the 1st, 5th and 6th defendants filed the replying affidavit of Milton Imanyara and that of the 1st defendant to oppose the motion.  The 1st plaintiff too filed the further replying affidavit of Patrick Thoithi Kanyuira to resist the motion.  I have considered the dispositions of the parties and their submissions.  I have further considered the facts deponed in the replying affidavit of Jared Benson Kangwana plus the supporting affidavit of Susan Salma Schiele.

4) It is the submission of the applicants that the consent order recorded on 9. 8.2010 affected interests of third parties who were not parties to the suit and the consent.  The applicants aver that they should have been consulted prior to the recording of the consent order.  The 1st, 5th and 6th defendants are of the view that the 1st interested party was aware of the existence of this suit but went ahead to obtain titles while this suit was pending hence she is affected by the doctrine of lis pendens. It was pointed out by the 1st, 5th and 6th defendants’ advocates that at the time of purchase by the 1st defendant, the 3rd and 4th defendants had sold their shares in the 2nd plaintiff company to the 5th and 6th defendants but later the 3rd and 4th defendants disowned the sale of the aforesaid shares and therefore ownership of the 2nd plaintiff reverted to the 1st plaintiff.  It is the 1st defendant’s argument that he instructed his advocates to enter into a consent conceding proprietorship rights to the plaintiffs.  This court was beseeched to find that the suit property should not be issued to the 1st Interested Party because the 1st defendant could not have transferred what he did not have in the first place. It is further argued that the doctrine of innocent purchaser for value cannot arise.

5) Having considered the material placed before this court and the arguments of the parties, it is clear that the consent order withdrawing the suit as against the 3rd and 4th defendant was recorded on 20. 2.2008 which the current motion does not make reference to.  It is also apparent that the suit having been withdrawn the 3rd and 4th defendants have not participated in any way in the consequent proceedings hence they are strangers to this matter.  This court was urged to review its decision to reinstate the 3rd and 4th defendant. It was  also pointed out that this court wrongly set aside the consent order which had removed  the 3rd and 4th defendants from suit without sufficient reason.

6) In the final analysis I am satisfied that the 1st defendant has proved that he could not have passed a good title and rights to Whitemeg Industries Ltd, the 2nd interested party.  Consequently, I am satisfied that the application dated 8th November, 2011 should be dismissed so far as it relates to the 3rd and 4th defendants and that the ruling on 31. 5.2017 that reinstated the suit against the 3rd and 4th defendants is set aside forthwith.

7) In the end, I find no merit in the motion dated 8. 11. 2011.  The same is dismissed with no orders as to costs.

Dated, Signed and Delivered in open court this 29th day of January, 2018.

J. K. SERGON

JUDGE

In the presence of:

....................................................  for the Plaintiff

..................................................... for the Defendant