MMS Advocates > Blog > Publications > The right to property in Kenya: the supreme court’s perspective on the application of the doctrine of bonafide purchaser for value

The right to property in Kenya: the supreme court’s perspective on the application of the doctrine of bonafide purchaser for value

July 13, 2023 Publications

summary of the supreme court of Kenya judgement in petition no.8 (e010) of 2021: Dina management ltd vs the county government of Mombasa & 5 others

On various dates in September 2017, the County Government of Mombasa forcefully entered the Appellant’s property situated in Nyali Beach, Mombasa County, demolished the entire perimeter wall facing the beachfront and flattened the whole property. It was alleged by the County Government that the entry and demolition was an enforcement action to create a thoroughfare to the beach as the suit property was public land and not private land, despite the fact that the Appellant had a lease title to the property.Prior to this incident, a suit had been filed and determined at the High Court in favor of the Appellant, which they insisted settled issues concerning ownership and validity of title over the suit property, as well as conclusively addressed whether there was a public road through the said suit property. Aggrieved by the actions of the County Government, the Appellant filed a suit at the Environment and Land Court (ELC) in Mombasa.

PROCEEDINGS AT THE ELC

The Appellant sought the following orders asserting their ownership of the property: a declaration that the 1st Respondent’s actions violated their constitutional rights, a permanent injunction to prevent further interference, cost reimbursement, compensation for property damage and trespass, interest, and Petition costs. The 1st Respondent filed a separate Petition claiming the property is public land and that the Appellant’s acquisition was null and void. They sought orders to revoke the title, cancel all related documents, evict the Appellant, damages for trespass and costs. The Appellant opposed the 1st Respondent’s Petition claiming that the suit property was previously government land lawfully converted to private property in 1989. They argued that regulations establishing the land as being public were not in force at that time, and no evidence was presented to prove it was a road reserve. Additionally, they argued that the suit was time-barred, that they were not involved in any illegalities and that the suit was res judicata.

The two Petitions were consolidated into one and the following key issues were considered:

  1. Whether the suit property was a public utility and there was a public access road through it to the beach;
  2. Were illegalities or faults committed by those responsible for alienating the suit property and whether the Appellant should suffer the faults of those third parties (if any);
  3. Whether the 1st Respondent’s suit is res judicata and/or an abuse of court process;
  4. Whether the suit was time barred and/or is the 1st Respondent guilty of latches and indolence;
  5. Whether the Appellant was the lawful owner of the suit property and entitled to the order sought.

The trial court dismissed the Appellant’s Petition and partially granted the 1st Respondent’s Petition. The court ruled that the alienation of the suit property was unprocedural and unlawful due to the lack of proper approvals and not following due process. The court affirmed that the access road to the open sea was blocked by the allotment and that the Respondent acted within the law in removing the wall which blocked the said road. Further, the court determined that the suit was neither res judicata nor time barred as it related to violations of human rights of a continuing nature. Finally, the court stated that since the Appellant failed to demonstrate due diligence as an innocent purchaser for value, there was therefore no resulting violation of their rights and no entitlement to the reliefs sought.

PROCEEDINGS AT THE COURT OF APPEAL

Aggrieved by the decision of the ELC, the Appellant lodged an appeal at the Court of Appeal premised on 22 grounds. The 2nd to 6th Petitioners filed a cross appeal challenging the jurisdiction of the court stating that the dispute was inter-governmental in nature and hence contrary to Articles 6, 159(c), 189(3) and (4) of the Constitution as read with Sections 30 to 35 of the Inter-Governmental Relations Act (IGRA). The County Government (1st Respondent) filed a Notice of Grounds for affirming the decision and argued that the suit property was trust land, and such land was not government land available for alienation.

The Court of Appeal determined the issues in contention as follows: Firstly,
the appellate court determined that the appeal did not involve an inter-governmental dispute, as the introduction of additional Respondents did not change the nature of the original property ownership dispute. On the second issue, the appellate court ruled that the claim of res judicata was baseless since the heart of the case concerned the root of ownership of the title which had not been determined other than by the ELC. In regards the third issue, the court determined that since the suit, was a Constitutional Petition to enforce ongoing violations of fundamental rights, it was not statute-barred under the Limitation of Actions Act. Additionally, Sections 41 and 42 of the Act exempted government land disputes from its application, including proceedings for the recovery of government land. On the fourth issue, the court ruled that it was not trust land and hence the applicable legislation was the GLA and therefore under the realm of the 2nd to 6th Respondents duties. Since the property was in the Municipality of Mombasa it was to be allocated as per Section 10 of the GLA which allows leases of town plots to be granted for “any term, not more than 100 years.”

With regards to the fifth issue on whether the title to the suit property was lawfully acquired and whether the Appellant was an innocent purchaser for value without notice, the appellate court agreed with the trial court, holding that the Appellant cannot enjoy protection under the doctrine of innocent purchaser for value. The court asserted that where property is acquired through a procedure against the law, the title cannot qualify for indefeasibility. The court therefore held that the title subsequently issued was invalid having been acquired illegally and irregularly. The appellate court held that the suit property was public land reserved for a public utility and that there was a road leading to the beach through the open space that was the suit property. Therefore, it remained a public utility, incapable of giving rise to a private proprietary interest capable of being protected by a court of law.

PROCEEDINGS BEFORE THE SUPREME COURT

Discontent with the decision of the appellate court, the Appellant filed an appeal at the Supreme Court. The parties were heard and the Supreme Court outlined the following key issues for determination:

  1. Whether the appeal meets the constitutional threshold under Article 163(4)(a) of the Constitution;
  2. Whether the Appellant’s rights under Articles 27(1) and 50(1) of the Constitution were violated by the appellate court’s application of the doctrine of res judicata and/or the doctrine of estoppel;
  3. Whether the suit amounted to an inter-governmental dispute under Article 189(3) of the Constitution and the Intergovernmental Relations Act No.2 of 2012
  4. Whether the appellate court’s interpretation of bona fide purchaser amounted to unjustifiable and unreasonable limitation of the right to property under Article 40 in violation of Articles 19(3)(c), 20(1), 21(3) and 23 of the Constitution;

In regards to the first issue, the court determined that it has jurisdiction as all the issues brought before it were issues of weighty constitutional interpretation and therefore fell under the ambit of Article 163(4) of the Constitution. With regards to the 2nd issue, the court stated that the matters were not res judicata. For a matter to be res judicata it must have been given a merited, final determination by a court of competent jurisdiction, where the first and second suit share identical parties, subject matter and cause of action. The court stated that the issues for determination in this matter were different and that the 2nd to 6th Respondents were not enjoined in the initial suit at the High Court causing the court’s findings to be inconclusive.

With respect to the 3rd issue, the Supreme Court agreed with the Court of Appeal that the question of the dispute being one of intergovernmental bodies, fell on the periphery and was incidental to the main issue in dispute.  The issues and challenges to the ownership of the suit property would have still been introduced in response to the Petition, even if by way of cross Petition.

With reference to the final issue, the court stated that allocation of unalienated government land ought to have followed due process. The court stated that it was evident that the original title holder did not follow the said due process while acquiring the land before selling it to a third party, who subsequently sold it to the Appellant. The court stated that it could not sanction irregularities and illegalities in the allocation of public land on the basis of indefeasibility of title. The court emphasized that it is not enough for a party to state that they have a lease or title to the property because a title or lease is an end product of a process. If due process was not followed prior to issuance of the title, and it did not comply with the law, then such a title cannot be held as indefeasible. The court determined that since the 1st registered owner did not acquire the title regularly, the ownership of the suit property by the Appellant thereafter could not be protected under Article 40 of the Constitution. The court therefore pronounced that the land automatically vests to the County Government of Mombasa pursuant to Article 62(2) of the Constitution.

CONCLUSION

The right to property is a fundamental human right protected under Article 40 of the Constitution of Kenya 2010. This decision by the Supreme Court adds a fresh perspective to the longstanding application of the doctrine of bona fide purchaser for value in Kenya. The decision underscores the crucial significance of adhering to proper procedures during the allocation of titles, reinforcing the necessity for thorough due diligence and historical searches in conveyancing. Purchasers are now compelled to exercise heightened caution, as the presence of a title and a simple search alone may no longer suffice for a secure transaction. In an ever-evolving legal landscape, this ruling serves as a stark reminder that robust safeguards and meticulousness are essential elements in real estate transactions.

DATE: JUNE 2, 2023 BY: ANNE GATHIRWA

For more insights pertaining to this matter, you can reach the writer at annegathirwalaw@gmail.com. You can also contact us at MMS Advocates, Lower Duplex Apartments, LOWER HILL ROAD, or email us at info@mmsadvocates.co.ke

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