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Supreme CourtPartially AllowedApplication 3 (E008) of 2022

Shah & 7 others v Mombasa Bricks & Tiles Ltd & 5 others

Supreme Court of Kenya
8 July 2022
3,029 words in judgment
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·~12 min to read original · ~4 min brief

The bottom line

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Supreme Court allows appeal on whether trusts can override registered land titles in Kenya.

What this practically means

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The Supreme Court of Kenya has allowed a property dispute to proceed to a full hearing. The case asks whether a constructive trust—an unwritten legal arrangement—can override a registered land title or share ownership obtained with payment. The Court also clarified that technical delays in electronic filing should not punish parties, and that a review of certification does not require a prior notice of appeal. A stay on property activities was granted pending the appeal.

Executive summary

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This ruling by the Supreme Court of Kenya (a five-judge bench) concerns an application for review of the Court of Appeal's decision declining to certify an appeal as one of general public importance under Article 163(4)(b) of the Constitution. The applicants, Arvind Shah and another, sought to appeal a Court of Appeal judgment that had introduced a constructive trust over land and shares, which they argued violated their constitutional right to property under Article 40. The respondents raised preliminary objections on jurisdiction, arguing the application was filed out of time due to electronic filing delays and that no notice of appeal had been filed. The Supreme Court overruled these objections, holding that rule 36(4) makes a notice of appeal optional before certification, and that the applicants should not be penalized for system downtime that caused a 20-minute delay in electronic filing. On the merits, the Court reviewed the Court of Appeal's decision and found that the core issue—whether a constructive trust can be imported into a land sale agreement or shareholding to defeat a registered title obtained for valuable consideration—transcends the parties and requires the Supreme Court's intervention to settle the jurisprudence. The Court therefore set aside the Court of Appeal's ruling and certified two specific questions for appeal. It also granted a stay of execution to preserve the suit properties pending the appeal. The costs of the application were ordered to abide the outcome of the appeal. The ruling clarifies procedural requirements for certification applications and establishes that the Supreme Court may grant conservatory relief in such applications.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether the application for review of the Court of Appeal's decision declining certification was competent despite not being preceded by a notice of appeal.
  2. 2.Whether the application was filed within the prescribed timelines given the electronic filing challenges.
  3. 3.Whether the applicants met the threshold for certification of the matter as one of general public importance.
  4. 4.Whether the court should grant a stay of execution pending the hearing of the proposed appeal.

Key legal issues

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01

Whether the application for review of certification was incompetent for lack of a prior notice of appeal.

Holding

The application was competent; rule 36(4) makes filing a notice of appeal optional before or after certification.

Reasoning

The respondents argued that the application was a nullity because no notice of appeal had been filed. The Supreme Court examined rule 36(4) of its Rules and its prior decisions in Telkom Kenya Limited v John Ochanda and Teachers Service Commission v Simon Kamau, which established that a notice of appeal is optional in matters of general public importance. Therefore, the application for review of the denial of certification could proceed without a prior notice of appeal.

02

Whether the application was filed out of time due to delays in electronic filing.

Holding

The application was filed within time; the delay caused by system downtime was excusable.

Reasoning

The respondents objected that the electronic filing was completed after 5:00 PM, outside working hours. The court found that the applicants' counsel was physically at the registry within working hours with the complete set of documents, which were stamped. The delay in completing the electronic upload and payment was due to system downtime beyond counsel's control. The court held that a party should not be penalized for such technical glitches, and the application was properly filed.

03

Whether the Court of Appeal erred in declining to certify the matter as one of general public importance.

Holding

The Court of Appeal erred; the matter raises issues of general public importance regarding constructive trusts and property rights.

Reasoning

The Court of Appeal had declined certification, finding the issues settled and fact-specific. The Supreme Court disagreed, holding that the core issue—whether a constructive trust can be imported into a land sale agreement or shareholding to defeat a registered title obtained for valuable consideration—transcends the parties and requires the Supreme Court's intervention. This issue has a significant bearing on public interest and constitutional property rights under Article 40, warranting certification.

04

Whether the court could grant a stay of execution pending the appeal in an application for review of certification.

Holding

The court could grant a stay; the application is not an interlocutory application under rule 31(2).

Reasoning

The respondents argued that rule 31(2) prohibits interlocutory applications before a petition of appeal is filed. The court distinguished the present application for review of certification from an interlocutory application, noting that it is a substantive application under rule 33. The court also relied on its discretion to grant conservatory relief to preserve the subject matter, citing Republic v Ahmad Abolfathi Mohammed and Town Council of Awendo v Nelson Oduor Onyango.

Legal principles established

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  • Filing a notice of appeal is optional before or after certification in matters of general public importance.
  • Parties should not be penalized for delays in electronic filing caused by system downtime beyond their control.
  • An application for review of certification is not an interlocutory application and can include a stay of execution.
  • The issue of whether a constructive trust can defeat a registered title obtained for value is a matter of general public importance.
  • The Supreme Court can grant conservatory relief to preserve the subject matter of an appeal pending determination.

Court orders

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  1. 1.The ruling of the Court of Appeal declining to certify this matter as one of general public importance is hereby set aside.
  2. 2.The applicants are granted leave to appeal to the Supreme Court limited to the following issues which are certified as involving general public importance: (a) Whether a constructive trust can be imported into a land sale agreement to defeat a registered title resulting therefrom; and (b) Whether a constructive trust can be imported into a shareholding of a company as to disentitle a registered holder of shares in a company obtained for valuable consideration.
  3. 3.All activities based on previous orders, that interfere with the status of the suit properties, as identified and as were in issue at the High Court and the Court Appeal, are hereby stayed, pending the hearing and determination of the proposed appeal.
  4. 4.The applicants to file and serve their appeal within 21 days of this ruling.
  5. 5.Once filed the appeal shall be disposed off on priority basis.
  6. 6.The costs of this application shall abide the determination of the appeal.

The bench

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One judgment of the whole court — no separate or dissenting opinions.

Philomena Mbete Mwilu
P.M. MwiluDCJ
Currently serving
majority
Smokin Charles Wanjala
S.C. WanjalaSCJ
Currently serving
majority
Njoki Susanna Ndungu
Njoki NdunguSCJ
Currently serving
majority
Isaac Lenaola
I. LenaolaSCJ
Currently serving
majority
William Ouko
W. OukoSCJ
Currently serving
majority
On appeal from
Court of Appeal at Mombasa
Mombasa Civil Application No 68 of 2019
Jurisdiction invoked
Article 163(4)(b) of the Constitution, sections 15 and 16 of the Supreme Court Act, rule 33 of the Supreme Court Rules

Relief refused

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Review of the Court of Appeal's decision on adherence to procedural timelines before that court.

That is a matter for the Court of Appeal's consideration in exercise of its jurisdiction and not for this court's consideration and determination.

Costs

The costs of this application shall abide the determination of the appeal.

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

rule 36(4) of the Supreme Court Rules makes it optional to file a notice of appeal either before or after certification in a matter of general public importance. Accordingly, the present application for review of denial of certification cannot be held to be incompetent merely because it was not preceded by the filing of a notice of appeal.
p. 7 Jurisdiction and procedure for certification
We are persuaded that counsel made best efforts to comply with the registration timelines and that there was system downtime which was beyond the control of the parties. The applicants should not therefore be punished for the delay in electronic filing on account of system downtime between uploading and electronic payment of fees that delayed the process for about 20 minutes beyond the working hours, through no fault of theirs.
p. 7 Electronic filing and extension of time
In our view, this is an issue that requires our intervention and input, as it transcends the applicants, amounts to a substantial point of law determination of which has a significant bearing on the public interest. There is need for this court to settle the surrounding jurisprudence as mandated by the Constitution and the Supreme Court Act.
p. 8 Threshold for certification of general public importance
The ruling of the Court of Appeal declining to certify this matter as one of general public importance is hereby set aside.
p. 9 Final orders - setting aside Court of Appeal ruling
The applicants are granted leave to appeal to the supreme court limited to the following issues which are certified as involving general public importance: a. Whether a constructive trust can be imported into a land sale agreement to defeat a registered title resulting therefrom; and b. Whether a constructive trust can be imported into a shareholding of a company as to disentitle a registered holder of shares in a company obtained for valuable consideration.
p. 9 Certified questions of general public importance
All activities based on previous orders, that interfere with the status of the suit properties, as identified and as were in issue at the High Court and the Court Appeal, are hereby stayed, pending the hearing and determination of the proposed appeal.
p. 9 Stay of execution orders
The costs of this application shall abide the determination of the appeal.
p. 9 Costs order

Key timeline

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2022-07-22
Supreme Court ruling setting aside Court of Appeal's denial of certification and granting leave to appeal.
2022-08-12
Applicants required to file and serve appeal within 21 days of the ruling.
Pending
Appeal to be heard on priority basis on the certified issues of general public importance.

Practical implications

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For lawyers

Strategic filing and certification review

Lawyers can now apply for review of a Court of Appeal's denial of certification without first filing a notice of appeal. This ruling also confirms that such a review application is not an interlocutory step, so you can seek a stay of execution to protect your client's property or shares while the appeal is pending. Ensure you document system downtime if electronic filing is delayed.

For businesses

Property and share title security

If you hold registered land or shares obtained for value, this case challenges whether a constructive trust can undo your ownership. The Supreme Court will decide this soon. For now, any court orders interfering with your property are stayed. Monitor this appeal closely—it could affect how secure your registered titles are against claims of unwritten trusts.

For individuals

Protecting your registered property

If you own land or shares registered in your name after paying for them, this case may impact your rights. The Supreme Court will rule on whether someone can claim a constructive trust to take your property away. Until then, a stay prevents any actions that could change the status of the properties involved. Stay informed as the appeal progresses.

Frequently asked questions

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What is a constructive trust in Kenya and how does it affect land ownership?+

A constructive trust is a legal arrangement created by a court to prevent unfairness, even without a written agreement. In Kenya, this case asks whether such a trust can override a registered land title obtained after paying for it. The Supreme Court will decide this, which could change how secure your registered property is.

Can I appeal a Court of Appeal decision in Kenya without filing a notice of appeal first?+

Yes, for matters of general public importance. The Supreme Court ruled that under rule 36(4) of its Rules, filing a notice of appeal is optional before or after certification. So you can apply for review of a denied certification without a prior notice of appeal.

What happens if I miss a filing deadline in Kenya due to system downtime?+

The Supreme Court said you should not be punished for delays caused by system downtime beyond your control. If you made best efforts to file within time and the delay was due to technical glitches, the court may accept your filing as timely. Keep evidence of the downtime.

Can I get a stay of execution in Kenya while applying for review of certification?+

Yes. The Supreme Court clarified that an application for review of certification is not an interlocutory application, so you can seek a stay of execution to preserve the property or shares in dispute. This prevents any actions that could change the status quo before the appeal is heard.

Later judgments citing this (6)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Shah & 7 others v Mombasa Bricks & Tiles Ltd & 5 others", Case Analysis (2022). Application 3 (E008) of 2022. Source: https://new.kenyalaw.orghttps://new.kenyalaw.org/akn/ke/judgment/kesc/2022/25/eng@2022-07-08

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.