[2023] KEHC 27296 (KLR)

Awinde (Suing on his behalf and on behalf of 74 others) v Diamond Property Merchants Limited (Civil Case 20 of 2019) [2023] KEHC 27296 (KLR) (15 November 2023) (Judgment)

Neutral citation: [2023] KEHC 27296 (KLR)

Republic of Kenya

In the High Court at Kajiado

Civil Case 20 of 2019

SN Mutuku, J

November 15, 2023

Between

Abraham Oluoch Awinde

Plaintiff

Suing on his behalf and on behalf of 74 others

and

Diamond Property Merchants Limited

Defendant

Judgment

1. Abraham Oluoch Awinde, has filed this suit through a Plaint dated 13th august 2019, on his behalf and that of 74 other individuals against the Defendant. The 74 individuals have signed a consent to authorise him to institute this suit on their behalf. The cause of action for all the 75 individuals arises from similar circumstances.

2. The Plaintiffs case is that they invested into an Agri- Business Project in Kajiado dubbed Bethany City Phase IV Project (the Project) in which they entered into a sale agreement with the Defendant for the purchase of whichever number of plots they were interested in and capable of buying for Kshs 500,000 per plot and that after purchasing the land, they would enter into a subsequent and separate agreement to purchase the green houses from either Agro Exchange Limited (AEL) or Nguzo International (Nguzo) for Kshs 300,000.

3. It is their case that AEL and Nguzo would set up the green houses and manage the same for the Plaintiffs and that the Plaintiffs would make profits after the sale of the crops. It is their case that the Defendant informed them to pay the full price for both the plots and greenhouses to the Defendant who would then transmit the money for the greenhouses to AEL and Nguzo.

4. They claim that at this time of the Agreement, the Defendant presented itself as the registered owner of Kajiado/Ildamat/5555 where the project was to be undertaken. The completion period was 6 months from date of the execution of the sale agreement. However, after the expiry of that time, the Defendant breached their contractual obligations by failing to issue the Plaintiffs with the Title Deeds for the plots after completion of payment. It is their case that they gave the Defendant 21 days’ notice to effect the completion but this was not done. The plaintiffs consequently issued rescission notices to the Defendant effectively terminating the sale agreement. It is their case that the Defendant sought for more time to complete their obligation under the contract, a request that was declined by the Plaintiffs.

5. The Plaintiffs allege that the sale agreement was void due to failure of the Defendant to honour the agreement and further that at the time of the said agreement, the Defendant was not the registered owner of Kajiado/Ildamat/5555. They claim that the Defendants failed to remit money paid to it by the Plaintiffs for purposes of the greenhouses to AEL and Nguzo, hence their claim for refund of the money. They are basing their claim on the doctrine of money had and received.

6. The Plaintiffs seek the following reliefs against the Defendant:i.A declaration that the Defendant is in breach of all agreements for sale of land executed between the Defendant and each of the Plaintiffs.ii.An order that the Defendant do refund to each of the Plaintiffs, the sum paid by each plaintiff towards purchase of land as set out in the table at paragraph 17. iii.A declaration that under the doctrine of money had and received, the Defendant is entitled and liable to refund to each of the Plaintiffs, the sums paid by each plaintiff towards purchase of green houses as set out in the table at paragraph 17. iv.An order that the Defendant do refund to each of the Plaintiffs, the sum paid by each plaintiff towards purchase of green houses as set out in the table at paragraph 17. v.Costs of the suit.vi.Interest on the sum payable under prayers(b) and (d) at courts rates from 18th July, 2018 when the land sale agreements were rescinded until payment of the said sums in full.vii.Any other relief(s) which this Honourable Court may deem fit and just to grant in the interest of justice.

The Defence 7. The Defendant, through its amended statement of Defence dated 20th September 2019, denied all the allegations made by the Plaintiff and stated that there was no condition tied to the purchase of the land and the greenhouses provided by AEL or Nguzo; that the Defendant was independent and was not part of the Agri-business; that the Plaintiffs had contractual obligations with AEL and Nguzo and that any guarantees made can only be enforced between the two parties. The Defendant denied acting jointly with the said two companies and stated that the two contracts were separate and were not related and that the money was paid to AEL and Nguzo as and when received.

8. It is the Defendant’s case that the Plaintiffs knew from the onset of the agreements that the Defendant was not the registered owner of Kajiado/Ildamat/5555 yet; that they are now the beneficial owners of the said property; that the delay in issuing titles to the plaintiffs was occasioned by the issue of zoning by Kajiado County Government; that this issue has now been resolved and that they are processing the said Title Deeds.

Plaintiff’s evidence 9. The hearing of this case commenced on 21st October, 2021 through virtual proceedings. The Defendant was absent. The court allowed the Plaintiffs’ case to proceed after satisfying itself that the Defendants had been duly served and acknowledged server and that there was an affidavit of service dated 21st October 2021 filed.

10. Mr. Abraham Oluoch Awinde testified as PW1. His case was used by the other 74 Plaintiffs as the test case on the issue of liability. He testified that he filed this suit on his behalf and on behalf of 74 others against the Defendant. He adopted his witness statement dated 13/8/2021 and produced the same as Exhibit -1. He also produced a list of documents dated 13/8/2019 the same was marked as exhibit 2. He produced another bundle of documents dated 15/1/2021 and the same was marked as Exhibit 3.

11. It is his evidence that he purchased plots number 186 and 187 which cost Kshs. 480,000 and Kshs 475,000 respectively from the Defendant; that he also bought one greenhouse from the Defendant; that he signed the purchase agreement with Agro Exchange Ltd; that in total he has paid Kshs. 1,255,000; that he has sued the Defendant because it did not transfer the money to AEL; that the Defendant should refund this money as a result of the breach of contract.

12. The following plaintiffs also testified and adopted their witness statements together with the documents they were relying on to support thier evidence:a.Alfred Mwanjari Makaub.Anastatia Nyawira Gakuruc.Beatrice Njoki Kiamad.Lilian Wambui Waithakae.Catherine Njeri Njugunaf.Jared Owino Oyayag.Everlyne Ngendo Kimanih.Farida Makambe Bandarii.Margaret Wamuyu Kinyuaj.Miriam L. A Mulurek.David Kagial.Christopher Muhanji Mayavim.Jennifer Wangui Gichiran.Reuben Wanyugi Kinuthiao.Pauline Kamaup.Lawrence Kabueq.Mary Wasiker.Mercy Joyce Waithereros.Rukia Muenit.Irene Mwendeu.Joshua Colombo Khamisv.Gilbert Okwiriw.Winnie Atieno Nginjax.Elizabeth Wahu Kiariey.Philomena Gathoni Mburuz.Mary Wangui Machariaaa.Milka Nyambura Kaguongoab.Everlyne Peres Adhiamboac.Franklin Odhiambo Omondiad.Winnie Chepkoech Ruttoae.Barbara Lydia Anjira Omoloaf.Christine Mumbi Kamauag.Evangeline Muthoniah.Philomena Wanjiru Kinuthiaai.Caroline Akinyi Ndoloaj.Eva Njambi Waithakayak.Esther Muthoni Mwangial.Rachael Aleyo Amauneam.Luch Mukami Kibuian.Evans Golwings Kinyuaao.Charity Wairimu Kamauap.James Muthui Gitahiaq.Salina Amusungut Isemear.Margaret Wangui Mainaas.Dennis Kipronoat.Florence Wangui Njugunaau.Lucy Wairimu Kimondoav.Martina Chelagataw.Esther Mumbi Kagoax.Samuel Ochiengay.Aaron Kimeu Muindiaz.Joseph Mwanziaba.Collins Odongobb.Simon Omondi Omuonobc.Lynet Adhiambo Odhunobd.Sharon Kibunjabe.Moses Onyango Libamba

13. The above plaintiffs reiterated the contents of the plaint and indicated the amount of money they each paid to the Defendant as per their individual sale agreements. The amount they claim to have paid the Defendant for both the purchase of the plots and greenhouses is tabulated under paragraph 17 of the Plaint at page 5. That table is reproduced in this Judgment for ease of reference:Name of Plaintiff No of Plots Purchase price(Kshs) No ofGreenhouse(s) PurchasePrice(Kshs) Total(Kshs)

1. Abraham Oluoch Awinde 2 955,000 1 300,000 1,255,000

2. Aaron Kimeu Muindi 1 480,000 1 300,000 780,000

3. Alfred Mwanjari Makau 1 500,000 2 600,000 1,100,000

4. Anastasia Nyawira Gakuru 2 1,000,000 2 600,000 1,600,000

5. Barbara Lydia Anjira Omolo & Joseph Chemirmir 1 550,000 1 300,000 850,000

6. Beatrice Njoki Kiama 1 500,000 1 320,000 820,000

7. Catherine Nduta Nganga 1 480,000 1 300,000 780,000

8. Catherine Njeri Njuguna & John Kamau Matalanga 1 480,000 1 300,000 780,000

9. Charity Wairimu Kamau 1 500,000 2 600,000 1,100,000

10 Christopher Muhanji Mayavi & Grace Anunda Ateka 1 300,000 1 485,000 785,000

11 Collins Odongo Odhiambo 1 480,000 2 600,000 1,080,000

12 David Kigo Maina 1 500,000 1 300,000 800,000

13 Dennis Kiprono 1 480,000 1 300,000 780,000

14 Doris M. Kilonzo 1 500,000 1 300,000 800,000

15 Emily Chepkorir 1 480,000 1 300,000 780,000

16 Emily Ndolo & Caroline Ndolo 2 960,000 1 300,000 1,260,000

17 Esther Mumbi Kago 2 960,000 2 600,000 1,560,000

18 Esther Muthoni Mwangi 2 960,000 2 640,000 1,600,000

19 Eva Njambi Waithaka 1 490,000 2 600,000 1,090,000

20 Evangeline Muthoni Wasunna 1 470,000 2 640,000 1,110,000

21 Evans Goldwings Kinyua 1 500,000 2 640,000 1,140,000

22 Evans Njiru Wachira 1 480,000 1 300,000 780,000

23 Evelyne Ngendo Kimani 1 480,000 2 600,000 1,080,000

24 Everlyne Peres Adhiambo & Dancan Marende Sunguti 1 490,000 1 300,000 790,000

25 Farida Makambe Bandari 2 1,000,000 3 900,000 1,900,000

26 Florence Wangui Njuguna 1 480,000 1 300,000 780,000

27 Frachia Gathoni Rugu 1 500,000 2 600,000 1,100,000

28 Franklin Odhiambo Omondi & Stephen Omondi 1 480,000 2 600,000 1,080,000

29 Gilbert Okwir & Rispa Onganji Mwakha 1 550,000 1 300,000 850,000

30 Gladys Cherono 1 500,000 1 300,000 800,000

31 Irene Mwende Mbuvi 1 480,000 1 300,000 780,000

32 James Muthui Gitahi 1 550,000 1 300,000 850,000

33 Jennifer Wangui Gichira & Ken Mburu Maina 1 500,000 - - 500,000

34 Jared Owino Oyaya 1 490,000 1 300,000 790,000

35 Joshua Colombo Khamis 1 500,000 2 600,000 1,100,000

36 Lillian Wambui Waithaka 1 490,000 1 300,000 790,000

37 Lucy Mukami Kibui 1 500,000 2 600,000 1,100,000

38 Lucy Wairimu Kimondo 1 470,000 2 640,000 1,110,000

39 Lynet Adhiambo Odhuno 1 480,000 2 640,000 1,120,000

40 Margaret Wamuyu Kinyua 1 500,000 2 600,000 1,100,000

41 Margaret Wangui Maina 2 1,100,000 2 600,000 1,700,000

42 Martina Chelang’at Shinabuli 6 2,880,000 6 1,800,000 4,680,000

43 Mary Nasimiyu Wasike 2 1,000,000 4 1,200,000 2,200,000

44 Mary Wangui Macharia 2 1,000,000 4 1,200,000 2,200,000

45 Mercy Joyce Waitherero Thuku 1 550,000 2 600,000 1,150,000

46 Mercy Wangui Waihenya 1 500,000 2 600,000 1,100,000

47 Michael Too & Winnie Chepkoech Rutto 2 970,000 3 900,000 1,870,000

48 Miriam L A Mulure 1 450,000 1 320,000 770,000

49 Moses Opando Ayumba 1 480,000 1 300,000 780,000

50 Pearl Pals Limited 2 1,000,000 1 - 1,000,000

51 Philomena Gathoni Mburu 1 500,000 2 600,000 1,100,000

52 Philomena Wanjiru Kinuthia 2 980,000 1 300,000 1,280,000

53 Racheal Aleyo Amaune 1 480,000 1 300,000 780,000

54 Reuben Wanyugi Kinuthia & Alex Gichira Maina 1 500,000 1 300,000 800,000

55 Rukia Mueni 1 500,000 2 600,000 1,100,000

56 Samatha Wendy Adhiambo 1 500,000 1 300,000 800,000

57 Samuel Ochieng Ojenge 2 1,200,000 3 900,000 2,100,000

58 Selina Amsugut Iseme 1 500,000 2 600,000 1,100,000

59 Sharon Kageha Adisa Kibunja 1 500,000 1 300,000 800,000

60 Silas Sanya Namenya 4 1,920,000 4 1,182,000 3,102,000

61 Simon Omondi Omuono 2 1,100,000 6 1,800,000 2,900,000

62 Victor Nick Wereh 1 480,000 1 300,000 780,000

63 Winnie Atieno Nginja 1 500,000 2 600,000 1,100,000

64 Phoebe Njoki Mungai 3 1,530,000 6 1,720,000 3,250,000

65 Jemimah Njeri 6 3,060,000 2 1,720,000 4,780,000

66 Elizabeth Njeri Mungai 4 2,040,000 - - 2,040,000

67 Grassroot Twenty Eleven Investment 2 960,000 3 900,000 1,860,000

68 Moses Oyango Libamba 1 480,000 1 340,000 820,000

69 Janet Gavana 1 550,000 1 300,000 850,000

70 Milkah Nyambura Kaguongo 2 1,00,000 5 1,500,000 2,500,000

71 Pauline Kamau 1 500,000 - - 500,000

72 Christine Mumbi Kamau 1 500,000 2 600,000 1,100,000

73 Joseph Mwanzia Ngui 1 500,000 2 600,000 1,100,000

74 Lawrence W. Kabue 4 1,920,000 3 1,800,000 3,720,000

75 Elizabeth Wahu Kiarie 1 480,000 1 300,000 780,000

TOTAL 55,428,000 43,187,000 98,615,000

14. Defendant did not adduce any evidence in support of its case. Despite service of the hearing notice to the Defendant, through its legal representative, the Defendant did not attend the hearing.

Plaintiff’s submissions 15. In addition to the oral evidence, the Plaintiffs filed their submissions dated 10th January, 2023 in which they reiterated the contents of their plaint. They submitted that the Defendant did not participate in these proceedings even after being served with Hearing Notice; that as a result the Defendant did not adduce any evidence in support of its case; that the Plaintiffs who testified were able to prove their case on a balance of probabilities and judgement should therefore be entered in their favour.

16. The Plaintiffs relied on Kioto Development Limited -vs- Mike Oyoo Wagunda (T/A Wagunda & Co. Advocates) [2014] eKLR where the court allowed the Plaintiff’s application for summary judgement. They also relied on various authorities including Yuvinalis Mangira Rwenyo -vs- Boniface Isaac & 3 others [2018] eKLR, where it was held that:“The defendants did not appear and hence the plaintiff’s evidence that they have trespassed onto his land was not challenged. In the absence of any challenge, I accept the plaintiff’s evidence and hold the defendants’ occupation of the plaintiff’s land is unlawful and amounts to trespass.’’

17. They submitted on the doctrine of money had and received that, the money they paid for the purchase of the green houses should be refunded by the Defendant. They relied on White Horse Investment Limited -vs- Nelson Havi T/A Havi Company Advocates [2009] eKLR, where it was held:“There is however no dispute in regard to the Kshs. 10 million, which was wired to the Defendant by the purchaser on 4th September 2007. Even if the Defendant did not take over the deposit of Kshs. 15 million from KW Advocate when he was instructed to take over as Advocate for the Vendor, as he has pleaded in the defence, and was therefore not a stake holder in regard to that amount the receipt of Kshs. 10 million is not denied. I am aware that the Defendant’s defence is that the Kshs. 10 million was paid to third parties. The Plaintiff’s position is that if the Defendant paid out the money to third parties then he did so without authority and that in the circumstances the sum is recoverable from the Defendant. That too is a triable issue, a contentious matter that will be determined at the trial. For the purposes of this application, the Defendant cannot argue that it did not receive the Kshs. 10 million so that even if the Defendant is not a stake holder in regard to the Kshs. 15 million, he is one in regard to Kshs. 10 million.As to issue whether he was sued as agent of a principal, it is clear to me that this suit is not brought against the Defendant as an agent. The suit lies in a claim for ‘money had and received’ by the Defendant as a stakeholder in a failed land sale transaction. He was to hold the money as a stakeholder. I think that it is clear that the Defendant has not been sued on behalf of a principal. Neither is the claim based on estoppel as alleged. Since the transaction failed, the amounts received by the Defendant as part of the consideration for the transaction, if the Plaintiff proves its case, is recoverable as a debt from the Defendant. In fact, I could go further and state that the sum shown to have been received by the Defendant in whatever capacity he received it in this failed transaction should be recoverable from him. As stated, the Plaintiff is yet to prove its case against the Defendant. For the purposes of this application however, I am satisfied that a reasonable cause of action is disclosed against the Defendant and that the case against him is clearly ‘for money had and received’ by him and therefore I find that the plaint is sustainable.’’

18. They submitted that in light of the testimony tendered by them, the documentary evidence adduced as exhibits, the fact that the Defendant entered appearance or filed a defence but never appeared through a witness during hearing, the Plaintiffs have proved their case and are entitled to refund of the sums paid for the purchase of the plots and the greenhouses.

Analysis and Determination 19. In my considered view, the main issue for determination in this case is whether the Defendant breached the contract between it and the Plaintiffs. My careful reading of the pleadings, both the Plaint and the Defence, show that the Defendant is admitted that there was a contract between it and the Plaintiff. The Defendant seems to distance itself from the money received for purposes of buying the greenhouses by stating that that it was not a party to the Agribusiness contract signed between the Plaintiffs and the Defendant. The defendant admitted being the beneficial owner of Kajiado/Ildamat/5555.

20. In paragraph 9 of the Defence, the Defendant admits the Plaintiffs knew at the time of signing the contract that the Defendant was not the registered owner of that land. The Defendant did not attend court to adduce evidence in defence of its case and from what I understand the defence to be stating, the claim is admitted safe for stating that they are not party to the agreement between the Plaintiffs and the AEL and Nguzo.

21. The Court in Jackline Njeri Kariuki v Moses Njung’e Njau [2021] eKLR stated as follows in respect to breach of contract:“In my understanding, a breach of contract is committed when a party, without lawful excuse, fails or refuses to perform what is due from him under the contract, or performs defectively, or incapacitates himself from performing.’’

22. The contract the Plaintiffs entered sometimes in January and February 2017 sets out the obligation that the Plaintiffs were to pay the purchase price for the various plots in respect to Title No. Kajiado/Ildamat/5555, after which the Defendant was to issue individual titles to the Plaintiffs. The Plaintiffs also entered into a separate agreement with the service providers being (AEL) and (Nguzo) who were to provide Agri business by constructing green houses on their various plots. I have also gone through this agreement and note that the Defendants had contracted the above-mentioned companies to carry out Agri business.

23. It is clear to me that the Defendant, having failed to attend court and counter the accusations against it by the Plaintiffs leaves the evidence of the Plaintiffs uncontroverted. It remains clear that the Defendants did not meet their contractual obligation. This led to the rescinding of the contract by the Plaintiffs as explained testified. I note that the sale agreement under clause 9. 2 states that: “in the event that the said breach is not remedied within twenty one days (21) notice period, the aggrieved party shall be at liberty to rescind the contract upon the expiry of the said twenty-one (21) days competition notice and thereafter is the breach persists in the case of the vendor, the purchaser shall be entitled to a refund of all monies paid to the vendor.”

24. I am persuaded, on a balance of probabilities, that the Plaintiffs have proved that they entered into a contract with the Defendant to purchase plots out of Kajiado/Ildamat/5555. Whether the Defendant was the registered owner or not, it is clear that the Defendant held itself as the owner of that land and in a position to sell the same to the Plaintiffs. The Defendant having admitted that such contracts existed, and having failed to tender evidence to the contrary, it is clear that the Plaintiffs are entitled to a refund of their money.

25. The Plaintiffs further claim that they made payments to the Defendant for the green houses for onward transmission to AEL and Nguzo. They are relying on the doctrine of money had and received in justifying their claim against the Defendant for refund of the said money. The doctrine of money had and received has been discussed by the court in Francis Mwangi Githuku & another v Jane Wambui Kingari & another [2017] eKLR where the court, relying on an American decision of Rotea v. Izuel (1939) 14 Cal.2d 605, 611 [95 P.2d 927] stated that:“The action for money had and received is based upon an implied promise which the law creates to restore money which the defendant in equity and good conscience should not retain. The law implies the promise from the receipt of the money to prevent unjust enrichment. The measure of the liability is the amount received.’ Recovery is denied in such cases unless the defendant himself has actually received the money.”

26. The evidence of the Plaintiffs is not controverted by the Defendant save stating that it was not a party between the agreement between the Plaintiffs and the Defendant. It is my finding, and I so hold, that the Plaintiffs have proved their case on a balance of probabilities. I have read the documents attached to the Plaintiffs’ witness statements. I note that they provided receipts showing that they paid out the money for the green houses to the Defendant. There is no evidence to the contrary. Consequently, it is my finding that the Plaintiffs have proved their case to the required standard. I hereby enter judgment in their favour in the following terms:a.A declaration is hereby issued that the Defendant is in breach of all agreements for sale of land executed between the Defendant and each of the Plaintiffs.b.An order is hereby issued that the Defendant do refund to each of the Plaintiffs, the sum paid by each plaintiff towards purchase of land as set out in the table at paragraph 17 of the Plaint.c.A declaration is hereby issued that under the doctrine of money had and received, the Defendant is entitled and liable to refund to each of the Plaintiffs, the sums paid by each plaintiff towards purchase of green houses as set out in the table at paragraph 17 of the Plaint.d.An order is hereby issued that the Defendant do refund to each of the Plaintiffs, the sum paid by each plaintiff towards purchase of green houses as set out in the table at paragraph 17 of the Plaint.e.Costs of the suit are awarded to the Plaintiffs.f.Interest is payable by the Defendant on the sum payable under orders (b) and (d) at courts rates from 18th July, 2018 when the land sale agreements were rescinded until payment of the said sums in full.

27. Orders shall issue accordingly.

DATED, SIGNED AND DELIVERED THIS 15TH DAY OF NOVEMBER 2023. S. N. MUTUKUJUDGE