Gitari v Kinuthia & 3 others (Environment and Land Appeal E011 of 2025) [2026] KEELC 1223 (KLR)

b. A mandatory order directed at the 2nd Defendant to transfer and release the original title relating to suit property title number RUIRU/MUGUTHA BLOCK 1/10577 within 30 days of the Judgment being delivered; c. That in the event the 2nd Defendant does not comply with the order in (b) above, the Deputy Registrar and/or the Executive Oficer of this Honorable Court be authorized to sign the transfer forms and all the documents necessary to facilitate transfer of the suit property title number RUIRU/MUGUTHA BLOCK 1/10577 to the Plaintifi; d. That in the event the 2nd Defendant does not comply with the order in (b) above, the Land Registrar, the third Defendant herein be ordered to cancel the title in respect of the suit property title number RUIRU/MUGUTHA BLOCK 1/10577 in the 2nd Defendant’s possession. Further, the Land Registrar be ordered to dispense with the production of the said original title when transferring the suit property title number RUIRU/MUGUTHA BLOCK 1/10577 to the Plaintifi; e. A prohibitory order directed at the Defendants not to interfere with the Plaintifi’s quite and peaceful enjoyment of the suit property title number RUIRU/MUGUTHA BLOCK 1/10577; f. That costs of this suit be awarded to the Plaintifi; g. That this Honorable Court does issue such further orders as it may deem fit and just to grant. 3. It was the Plaintifi’s evidence that she was given possession of the property upon paying Kesh 3,000,000 she had a balance of Kesh 700,000 which was to be paid within 1 year. It took her 4 years to pay the balance. She also testified that she did not produce an addendum agreement and the agreement signed earlier had a default clause. 4. She testified that she had no evidence to show that she communicated with the 1st Defendant on late payment of the balance. Further that she filed this suit a year later after discovering that the property had been sold to the 2nd Defendant. At the same time, she told the Court that the 1st Defendant did not communicate with her while transferring the land back to himself and therefore she stated they are all in breach of the Sale Agreement. 5. On his part the 1st Defendant did not dispute the fact that he entered into a Sale Agreement with the Appellant/Plaintifi for sale of RUIRU/MUGUTHA BLOCK 1/10577 but she failed to pay the remainder of the purchase price within the 90 days period stipulated in the agreement. 6. That since the Plaintifi failed to communicate with him, he terminated the agreement on 28/12/2017. That whereas he received a letter from the Plaintifi with a promise to provide a cheque of the balance, to date this has never been paid. He told the Court that he sold the suit property to the 2nd Defendant 5 years later after the Plaintifi frustrated the agreement after the property was transferred back to him on 11/11/2021. 7. In his evidence to Court the 2nd Defendant told the Court that he was the registered owner of RUIRU/ MUGUTHA BLOCK 1/10577. 8. When the matter was brought before the Senior Resident Magistrate’s Court Hon. D Milimu after listening to all the parties found for the 2nd Defendant and stated as follows: “ In the end, this Court has made a determination that the 2nd Defendant is the registered owner of the suit property RUIRU/MUGUTHA BLOCK 1/10577 having purchased the https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/1223/eng@2026-03-02 2

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same legally. The Plaintifi has not made a case to warrant the issuance of the orders being sought hence this suit is hereby dismissed with costs to the Defendants.” 9. Being aggrieved by the said Judgement, the Appellant filed the Memorandum of Appeal dated 28/01/2025 on the following grounds:1. That the learned trial Magistrate erred in law and in fact in disregarding and failing to evaluate and place the appropriate weight to the fundamental and crucial evidence adduced by the Appellant. The resultant consequence being that the learned Magistrate erred in law and fact in dismissing the Appellant’s claim against the colossal weight of relevant evidence that was placed before her by the Appellant. 2. That the learned trial Magistrate erred in law and in fact in failing to find that the Appellant is the undisputed sole, lawful and legal registered proprietor of the suit property comprised in the Title Number RUIRU/MUGUTHA BLOCK 1/10577 having purchased the same from the 1st Defendant for value together with RUIRU/MUGUTHA BLOCK 1/10575 & RUIRU/ MUGUTHA BLOCK 1/10576 via a single Agreement for Sale dated 19th January 2017 and subsequently, being registered and issued with title deeds as an absolute proprietor of each of the three parcels including the suit property on 27th February 2017. 3. That the learned trial Magistrate erred in law and in fact in failing to find that the transfer of the suit property Title Number RUIRU/MUGUTHA BLOCK 1/10577 (the “Suit Property”) back to the 1st Defendant on the 11th November, 2021 was unprocedural, unlawful and void since it was based on forged and fraudulent documents given that the Plaintifi as the registered proprietor since 27th February, 2017 was not involved and did not sign any transfer or transaction documents to that efiect. 4. That the learned trial Magistrate erred in law and in fact in failing to find that the subsequent transfer of the suit property Title Number RUIRU/MUGUTHA BLOCK 1/10577 by the 1st Defendant to the 2nd Defendant on 8th December 2021 was incurably and fatally defective therefore unlawful, null and void since the 1st Defendant did not have a good title capable of being transferred having fraudulently acquired the said title through illegal transfer back to himself on 11th November 2021. 5. That the learned trial Magistrate erred in law and in fact in failing to find that the 2nd Defendant was not a bonafide purchaser for value without notice as he was always aware of the Plaintifi’s proprietary rights to the suit property Title Number RUIRU/MUGUTHA BLOCK 1/10577 prior to the commencement of the sale and purchase transaction with the 1st Defendant and throughout the said transaction. 6. That the learned trial Magistrate erred in law and in fact in failing to find that the 1st Defendant did not terminate the sale transaction with the Plaintifi in respect of the suit property Title Number RUIRU/MUGUTHA BLOCK 1/10577 and as such, lacked capacity to enter or entertain any other transaction over the same property which was then registered in the name of the Plaintifi since 27th February 2017. 7. That the learned trial Magistrate erred in law and in fact in disregarding the fact that the 1st Respondent sold the suit property to the 2nd Respondent after he had been furnished with the then outstanding balance of the purchase price by the Appellant. 8. That the learned trial Magistrate erred in law and in fact in disregarding the fact that the payment of the balance of the purchase price was ofiered by the Appellant before the https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/1223/eng@2026-03-02 3

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transaction was purportedly terminated or rescinded by the 1st Respondent allegedly on account of failure by the Appellant to pay the balance of purchase price. 10. 11. 9. That the learned trial Magistrate erred in law and fact by applying the wrong principles in determining uncontested facts regarding the validity and legality of the Appellant’s title to the suit property Title Number RUIRU/MUGUTHA BLOCK 1/10577 subject of the suit before her. 10. That the learned trial Magistrate erred in law and fact by taking into account oral statements that she ought not to have taken into account in determining the matter before her. The learned Magistrate considered and placed undue weight on inadmissible evidence thereby prejudicing the Appellant. 11. That the learned trial Magistrate erred in law and in fact by acknowledging the fact that the 1st Respondent did not terminate or serve a termination notice upon the Appellant nor refunded the part-paid amount on account of purchase price for the Suit Property Title Number RUIRU/MUGUTHA BLOCK 1/10577 but failed to address the consequences of failing to issue a termination notice and its dire impact on the transaction between the Appellant and the 1st Respondent. 12. That the learned trial Magistrate erred in law and in fact by acknowledging the fact that the 1st Respondent was either required to issue a termination notice or sue for specific performance which he never did but failed to address herself on the illegality of the method the 1st Respondent opted for by unilaterally transferring the suit property Title Number RUIRU/ MUGUTHA BLOCK 1/10577 back to himself without the Appellant’s involvement at all or a Court order and subsequently selling and transferring the suit property to the 2nd Respondent. 13. That the learned trial Magistrate erred in law and in fact in finding that the Appellant failed to prove allegations of fraud. 14. That the learned trial Magistrate erred in law and in fact in finding that the 2nd Respondent was a bonafide purchaser of the Suit Property for value without notice. 15. That the learned trial Magistrate erred in law and in fact in rewarding the 1st Respondent with an award of costs despite the fact that evidence of fraud and wrongdoing on his part was presented before the Honourable Court. The Appellant is therefore seeking the following Orders from Court: a. That the Appeal against the entire Judgment and Decree of Honourable D. Milimu delivered on 13th January 2025, in the Thika MC.ELC. Case No. E083/2022, be allowed. b. That the Judgment and Decree of Honourable D. Milimu delivered on 13th January 2025, in the Thika MC.ELC. Case No. E083/2022, be set aside in their entirety. c. That the costs of this Appeal and the costs of the Lower Court proceedings be borne by the Respondents. d. That any further or alternative relief and or order that this Honourable Court may deem fit and just to grant. The Appeal was canvassed by way of written submissions. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/1223/eng@2026-03-02 4

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Appellant’s Submissions 12. In her submissions, dated 16/09/2025, the Appellant stated that in January 2017, she purchased three parcels of land from the 1st Respondent for Kshs. 3,600,000. She paid the bulk of the price, leaving a balance of Kshs. 700,000. 13. All three titles including the suit property were registered in the Appellant's name. However, the 1st Respondent retained the original title for the suit property as security until the balance was paid. Due to financial constraints, the Appellant delayed paying the balance but eventually sent a Banker’s Cheque on August 5, 2021. 14. However, despite receiving the payment, the 1st Respondent with the help of the 3rd Respondent/ Registrar transferred the property back to himself on November 11, 2021, and then sold it to the 2nd Respondent on December 8, 2021. 15. The Appellant in her submissions argues that the 1st Respondent failed to follow the mandatory statutory procedures for rescinding a land contract. That Section 39 of the Land Act, 2012 outlines the vendor's right to rescind a contract and resume possession if the purchaser is in breach. That Section 41 of the Land Act, 2012 mandates that a vendor must serve a formal notice on the purchaser, specifying the nature of the breach and giving at least 30 days to remedy it before rescinding. 16. At the same time, the LSK Conditions of Sale (2015) Clause 13.4 requires the issuance of a Completion Notice to make time of the essence before a party can rescind. 17. From her submissions, the Appellant relies on several authorities to prove that the transfer was illegal and that the 2nd Respondent was not an innocent buyer. Among these authorities is Ruth Wanjiku Ng’ang’a v Teresia Wangui Ng’ang’a [2019] eKLR which she used to show that a rescission is void if the mandatory Section 41 notice is not served via registered post or fails to specify the breach. 18. The case of Anne Murambi v John Munyao Nyamu [2018] eKLR is also quoted where in the submissions she shows that it establishes that a contract remains valid and enforceable if no formal rescission notice is served, even if the completion period has lapsed. 19. Further, the Appellant argues the 2nd Respondent fails this test of formal recission because he had a copy of the title in the Appellant's name and knew of her interest. She refers to the case of Katende v Haridar & Co. Ltd [2008] 2 E.A. 173 which sets the criteria for a bona fide purchaser. Another case referred to is the case of Ratilal Patel v Lalji Makanji [1957] EAR 314 regarding the Standard of Proof for fraud, noting it must be strictly proved and requires something more than a balance of probabilities. 20. It is the contention of the Appellant that 1st Respondent never served a termination notice making the recission illegal and therefore, the Sale Agreement was still alive when the Appellant tendered the final payment in August 2021. 21. According to the Appellant, she never signed transfer documents or applied for Land Control Board consent to transfer the land back to the 1st Respondent. That these documents were forged and the act was fraudulent. 22. Therefore, since the 1st Respondent acquired the title through fraud, he had no legal right to sell it to the 2nd Respondent as espoused in the maxim Nemo dat quod non habet. 23. Further, that the 2nd Respondent conducted a search and saw the Appellant's name but proceeded to transact with the 1st Respondent thus, he cannot claim to be a bona fide purchaser without notice. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/1223/eng@2026-03-02 5

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24. The Appellant thus requests the Court to set aside the Judgment of the trial Magistrate delivered on 13/01/2025 and hold that the transfer of the suit property back to the 1st Respondent and subsequently to the 2nd Respondent was fraudulent and void, and award costs to the Appellant. 2nd Respondent’s Submissions 25. In response to the Appeal, the 2nd Respondent filed submissions on 22/09/2025, urging the Court to uphold the trial Court's Judgment. Their core argument is that they are an innocent third-party purchaser whose title is protected by law, regardless of the private contractual disputes between the Appellant and the 1st Respondent. 26. According to the 2nd Respondent, they argue that the Appellant failed to provide tangible evidence of fraud or collusion. That under Section 107 and 109 of the Evidence Act, the burden of proof lies with the Appellant, he who alleges must prove. They point out the lack of forensic reports for the alleged forgeries or police reports on the matter. 27. He asserts that they performed due diligence by conducting a search on the Green Card which showed the 1st Respondent as the registered owner. They argue that knowledge of a past transaction which the vendor claimed was lawfully rescinded does not equate to knowledge of fraud. 28. Further that under the Land Registration Act, registration vests absolute ownership. They contend that even if the 1st Respondent’s acquisition of the title was fiawed, the 2nd Respondent’s title remains valid because they were not party to any illegality. 29. The 2nd Respondent also raised the issue of privity of contract and argues that the dispute over the completion notice and Section 41 notices that the Appellant has raised in her submissions is strictly between the Appellant and the 1st Respondent making the matter res inter alios acta which dictates that transactions, contracts or acts between certain parties should not harm or benefit third parties who are not involved. The maxim establishes that a contract's obligations or actions do not bind strangers, and in evidence law, it often deems evidence from outside parties to be irrelevant to the immediate case. Therefore the 2nd Respondent contends, any breach should result in a claim for damages against the 1st Respondent and not cancellation of the 2nd Respondent’s title. 30. The 2nd Respondent in his submissions relies on the Evidence Act Sections 107 and 109 which establishes that the Appellant bears the burden of proving the existence of fraud. Section 24 (a) of the Land Registration Act which vests absolute ownership and rights in the proprietor and finally Section 26(1) which establishes that a Certificate of Title is prima facie evidence of absolute ownership and can only be challenged if the proprietor is proved to be a party to fraud. 31. Some of the authorities referred to are Sehmi v Tarabana Co. Ltd [2025] KESC which defines innocence as exercising the diligence expected of a reasonable purchaser via reasonable inquiry. The other case referred to is the case of Torino Enterprises Ltd v Attorney General [2023] KESC which elaborates that a diligent purchaser must conduct a physical inspection to check for visible signs of occupation. 32. Further the other case referred to is Katende v Haridar & Co. Ltd [2008] 2 E.A. which provides the 7step test for a bona fide purchaser who holds title, paid value, no knowledge of fraud and not a party to fraud. At the same time there is the case of Elijah Makeri Nyangw'ara v Stephen Mungai [2013] eKLR where the Court held that fraud must be pleaded specifically and proved to a higher standard than the balance of probabilities. And the case of Ruai Central 54 Association v Paddy Kamau [2020] https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/1223/eng@2026-03-02 6

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KEELC which reafirms that a purchaser's title is protected if there is no evidence they were involved in fraudulent registration. 33. The 2nd Respondent has concluded by asking the Court to dismiss the appeal for lack of merit and to afirm the trial Court’s finding that the 2nd Respondent is a bona fide purchaser for value without notice and costs of the appeal to be paid by the Appellant. Analysis and Determination 34. The Court has perused the grounds set out in the Appellant’s Memorandum of Appeal as well as the material on record. Although the Appellant raised 15 Grounds of Appeal, the Court is of the opinion that resolution of the following issues would efiectively determine the appeal: a. Whether there was a valid recission and the 1st Respondent legally terminated the 2017 agreement. b. Whether the transfer from the Appellant back to the 1st Respondent was fraudulently done or a legal consequence of a breach. c. Who pays the cost of the appeal? 35. As a first Appellate Court, this Court is enjoined to relook at the evidence that was adduced before the trial Court afresh, analyse it, evaluate it and come to its own independent conclusion. However, the Court must revisit the evidence bearing in mind that it did not have the opportunity like the trial Court of seeing and hearing the witnesses first hand. Plus observing their demeanor for which allowance should be given as was stated in the case of Seascapes Limited v Development Finance Company of Kenya Limited [2009] KLR 384 and in Selle & Another v Associated Motor Boat Co. Ltd. & Others (1968) EA 123. 36. The guiding parameters for this Court are therefore, on first Appeal; the Court is under a duty to reconsider and re-evaluate the evidence on record and draw its own conclusions; secondly, in reconsidering and re-evaluating the evidence, the first Appellate Court must bear in mind and give due allowance to the fact that the trial Court had the advantage of seeing and hearing the witnesses testify before her; and lastly it is not open to the first Appellate Court to review the findings of a trial Court simply because it would have reached difierent results if it were hearing the matter for the first time. 37. The Appellant argues that the 1st Respondent’s failure to serve a Section 41 Land Act notice makes the re-acquisition of the land void. 38. In Ruth Wanjiku Ng’ang’a v Teresia Wangui Ng’ang’a; Peter Njoroge Kagwima & 31 others (Interested Party) [2019] eKLR, the Court held that statutory notices are mandatory. Without proof of service ideally via registered post, a vendor cannot unilaterally take back property already registered in the purchaser's name. 39. Whereas the Court in Union Eagle Ltd v Golden Achievement Ltd [1997] UKPC), observed that while time is of the essence clauses are strictly enforced, equity and statute often require a notice to complete before a contract is rescinded. 40. Although the 2nd Respondent correctly cites Section 107 of the Evidence Act, the Appellant relies on a higher standard than the balance of probabilities. 41. The case of Ratilal Patel v Lalji Makanji [1957] EA set the standard of fraud and stated that fraud must be strictly proven, but it is not on a beyond reasonable doubt basis. The fact that the Appellant still had the title deeds and never signed a transfer instrument is compelling circumstantial evidence of fraud. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/1223/eng@2026-03-02 7

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42. Under the Torrens System used in Kenya, Australia, and Canada, fraud is one of the few ways to pierce the indefeasibility of a title. 43. This is the most contentious issue. The 2nd Respondent argues he relied on the Green Card which is a public record. The Appellant argues he was willfully blind since the 1st green card record showed the Appellant as the owner of the suit property. The 2nd Respondent states that he conducted a second search and now the green card showed that the 1st Defendant is the owner of the suit property. Yet this did not raise any alarm for the 2nd Respondent. In Katende v Haridar & Co. Ltd [supra], the Court held that a purchaser must prove they had no notice of fraud. 44. In the case of Sehmi & Another v Tarabana Company Limited [2025] KESC, the Court emphasized that a purchaser cannot ignore red fiags. If the 2nd Respondent saw a title in the Appellant's name and was told a story by the vendor about a cancellation, his failure to contact the Appellant directly may constitute constructive notice. It is a key element in determining whether a purchaser is a bona fide purchaser for value without notice. 45. In the Canadian case of United Trust Co. v. Dominion Stores Ltd. [1977] SCR, the Court held that actual notice of a prior unregistered interest can defeat the protection of the land registry. 46. Conclusively therefore, the Appellant has alleged that the root of the 2nd Respondent's title was a nullity. That if the transfer back to the 1st Respondent was based on a forgery, then the 1st Respondent had no title to pass. 47. Based on the legal principles governing Kenyan land law and the specific evidence presented in the submissions, a conclusive finding in this matter hinges on the doctrine of the root of title. In land ownership disputes, Courts are increasingly looking beyond a registered title deed to verify the root of title, as established in Munyu Maina v Hiram Gathiha Maina [2013] eKLR. A title is not an absolute shield if it is procured through fraud, misrepresentation, or irregular, unlawful, or unprocedural methods. When the root of title is challenged, the proprietor must prove the legal acquisition of the property. 48. The weight of the law specifically the Land Act 2012 and recent Supreme Court jurisprudence points toward a finding in favor of the Appellant. The Supreme Court has pronounced itself countless times that it is not enough to wave a title if it is under scrutiny. The 1st Respondent’s re-acquisition of the title was void ab initio. 49. Under Sections 39 and 41 of the Land Act, the service of a notice of rescission is not a mere formality; it is a mandatory statutory condition precedent. Because the 1st Respondent failed to serve this notice, he had no legal power to move the property back into his name. 50. In legal terms, the transfer back to himself was a paper transaction with no legal force. Therefore, when he sold the land to the 2nd Respondent, he was selling something he did not legally own. 51. At the same time, whereas the 2nd Respondent has sought to hide behind the innocent purchaser principle, it fails and it goes against him. While he relies on Section 26 of the Land Registration Act, the finding go against him for two reasons. The first being the McFoy Principle. As famously held in MacFoy v United Africa Company Ltd [1962] AC 152 (often cited as [1961] 3 All ER 1169), “ You cannot put something on nothing and expect it to stay there. It will collapse." 52. If the 1st Respondent’s title was a nullity, the 2nd Respondent’s title is built on a collapsed foundation. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/1223/eng@2026-03-02 8

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53. Further, the 2nd Respondent admitted he saw the Appellant's name on the title history. The finding would likely be that a reasonable and diligent purchaser would have demanded proof that the Appellant’s interest was legally extinguished through a signed surrender or a valid rescission notice. By failing to do this, he was willfully blind. 54. Therefore, it is my observation that the Trial Magistrate erred by focusing on the standard of proof for fraud while ignoring the statutory illegality of the rescission. 55. Even if the Appellant could not prove how the signature was forged the Green Card itself proves the 1st Respondent took the land back without following the Land Act procedure thus committing a statutory illegality that cannot be wished away. 56. Given the foregoing, I make the following findings: a. Appeal is hereby allowed. b. The transfers to the 1st Respondent in November 2021 and the 2nd Respondent in December 2021 are hereby cancelled and set aside. c. The Land Registrar is directed to rectify the register by reinstating MARY KAUMBI GITARI as the absolute proprietor. d. The 1st Respondent is ordered to pay damages to the 2nd Respondent. e. The Appellant to pay the balance of the purchase price at market rates as at November 2021. f. The 1st Respondent to pay the cost of the Appeal. Orders accordingly. DATED, SIGNED AND DELIVERED AT THIKA THROUGH MICROSOFT TEAMS ON THIS 2ND DAY OF MARCH 2026. ........................... MOGENI J JUDGE In the presence of :……………………………………. for the Appellant …………………………………… for the 1st Respondent …………………………………… for the 2nd Respondent …………………………………… for the 3rd Respondent …………………………………… for the 4th Respondent Melita ………………………….. for Court Assistant ........................... MOGENI J JUDGE https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/1223/eng@2026-03-02 9

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