https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5274

**REPUBLIC OF KENYA** **IN THE ENVIRONMENT AND LAND COURT AT NAIROBI** **ELC CASE NO. 211 OF 2017** **BEN MURUMBA NAKITARE ……….......................……..….…………….. PLAINTIFF** **VERSUS** **SPEED CAPITAL LIMITED ……………….........................…………….1ST DEFENDANT** **OSMAN ABDULLAHI ALI………………......................………………..2ND DEFENDANT** **THE CHIEF LAND REGISTRAR …………………........................……3RD DEFENDANT** **DIRECTORATE OF CRIMINAL** **INVESTIGATIONS (DCI)…………………….......................……………4TH DEFENDANT** **THE HONOURABLE ATTORNEY GENERAL…….....................….5TH DEFENDANT** **JUDGMENT** 1. The plaintiff filed the amended plaint dated 7th November, 2023 seeking judgment against the defendants jointly and severally for:- 2. ***A permanent injunction to restrain the defendants from interfering with the suit property known as land reference no. 5892/10 situated in Karen, Ololua ridge.*** 3. ***The 1st defendant do execute and handover to the plaintiff an instrument of discharge of the charge dated 8th April 2016, registered against land reference no. 5892/10 and in default of exercising such instrument, the deputy registrar of the court do execute the same on behalf of the 1st defendant.*** 4. ***A declaration that land reference no. 5892/10 situated in Karen, Ololua ridge owned and belonging to the plaintiff and registered on 13th April, 2005 is the valid and genuine title issued by the Ministry of Lands in favour of the plaintiff.*** 5. ***A declaration that the title held by the plaintiff is the genuine and authentic title confirming bona fide ownership of land reference no. 5892/10, situated in Karen, Ololua ridge to the plaintiff and any other duplicitous, fraudulent, invalid title is null and void.*** 6. ***A declaration that the charge entered and registered on land reference no. 5892/10 situated in Karen, Ololua ridge on 8th April, 2016 by the 1st defendant and the 2nd defendant touching on the rights of the plaintiff is duplicitous, fraudulent, invalid, non-existent, null and void.*** 7. ***An order that the charge entered and registered on land reference no. 5892/10 situated in Karen, Ololua ridge on 8th April, 2016 be cancelled, annulled and be revoked by the 3rd defendant.*** 8. ***A declaration that the purported title held and presented to the 1st defendant by the 2nd defendant on 8th April, 2016 to secure a loan facility for an amount of Kenya Shillings ten million (Kshs.10,000,000) is a forged and invalid title.*** 9. ***A declaration that the charge in favour of the 1st defendant was based on a bad title and the same be discharged unconditionally.*** 10. ***An order compelling the 3rd defendant to rectify the register entry by invalidating the purported duplicitous, fraudulent, invalid non-existent charge entered on 8th April, 2016.*** 11. ***An injunction prohibiting the 1st defendant from dealing with, alienating, or in any other manner whatsoever, disposing of the suit property.*** 12. ***A permanent injunction restraining the 1st defendant or its agents and/or servants and/or assigns from interfering with the plaintiff’s quiet possession, occupation and enjoyment of the suit property.*** 13. ***A permanent injunction directed to the 1st defendant, its directors, shareholders, members, associates, agents, employees and any person acting through them, restraining them from trespassing, or in any way dealing or interfering with the plaintiff’s parcel of land registered as land reference no. 5892/10, situate in Karen, Ololua ridge, Nairobi County.*** 14. ***A permanent injunction directed to the 1st defendant, its directors, shareholders, members, associates, agents, employees and any person acting through them, compelling them to vacate the plaintiff’s parcel of land registered as land reference no. 5892/10, situate in Karen, Ololua ridge, Nairobi County failure to which they will be forcefully evicted from the plaintiff’s land.*** 15. ***A permanent injunction directed at the 1st and 3rd defendants, its subordinates, directors, officers or persons acting through them from interfering with or dispossessing/depriving the plaintiff of his parcel of land registered as land reference no. 5892/10, situate in Karen, Ololua ridge, Nairobi County including through making entries, registration or receiving documents on the lands register averse to the plaintiff’s interests and proprietorship of the suit property without the plaintiff’s consent.*** 16. ***A order directing the officer commanding police division, Karen, the divisional criminal investigations officer Langata/Karen to ensure that the orders issued by this honourable court are obeyed and to provide assistance in the evictions should the 1st defendant, its directors, shareholders, members, associates, agents, employees and any person acting through them fail to vacate the suit property that is to say the parcel of land registered land reference no. 5892/10 situate in Karen, Ololua ridge, Nairobi county.*** 17. ***An order against the 1st defendant to compensate the plaintiff herein by way of general and exemplary damages for trespass and all illegal activities on the plaintiff’s parcel of land registered land reference no. 5892/10 situate in Karen, Ololua ridge, Nairobi County.*** 18. ***An order against the 3rd, 4th and 5th defendants to compensate the plaintiff by way of general and exemplary damages for all losses, damages and injury arising from failing to properly and expeditiously conduct investigations in regard to the plaintiff’s complaint regarding illegal activities on the plaintiff’s parcel of land registered land reference no. 5892/10 situate in Karen, Ololua ridge, Nairobi county.*** 19. ***Any other remedy, prayer and relief it deems fit and just to protect the plaintiff’s constitutional rights to the parcel of land registered as land reference no. 5892/10 situate in Karen, Ololua ridge, Nairobi county.*** 20. ***Costs of this suit.*** 21. In the amended plaint, the plaintiff averred that he is the registered owner of land reference no. 5892/10, the suit property situated in Karen, Ololua ridge having acquired the same on 2nd February, 2005. He averred that since acquisition of the suit property, he has enjoyed peaceful and quiet possession of the same. That on 16th December 2015, he entered into a sale agreement with Ronald Kairu for the sale of half an acre that was to be hived off from the suit property. Thereafter, he commenced the sub-division process and discovered that the suit property had been charged to the 1st defendant on 8th April, 2016. As far as he is concerned, he had not charged his property to any financial institution, particularly the 1st defendant as collateral to guarantee the 2nd defendant who is unknown to him. Upon discovery, he proceeded to the 1st defendant’s office and the central police station to report the same. 22. The plaintiff averred that the 2nd defendant was traced, arrested and charged in criminal case no. E334 of 2021. He asserted that that the 1st and 2nd defendants conspired to fraudulently charge the suit property by using fraudulent title documents with the intent of depriving him of the suit property. The plaintiff pleaded particulars of fraud by the 1st, 2nd and 3rd defendants, and stated that as a result of the actions of the said defendants, he had to refund the deposit to the purchaser. 23. He averred that he is in possession of the original title documents, and that the charge registered against the suit property by the 3rd defendant is fraudulent, invalid, null and void. 24. The 1st defendant filed the amended statement of defence and counterclaim dated 9th September, 2024. The 1st defendant averred that the plaintiff guaranteed the 2nd defendant and offered the suit property as security for the loan advanced. While denying the particulars of fraud and forgery, the 1st defendant pleaded that it advanced to the borrower (2nd defendant) with express permission of the plaintiff and they registered the suit property on 11th April, 2016 as security, and that it followed the laid down procedure before registering the charge. 25. In its counterclaim against the plaintiff and 2nd defendant, the 1st defendant averred that they have failed and refused to pay the outstanding sum of Kshs.8,333,333.30/- which continues to earn interest. The 1st defendant is seeking that judgment be entered in its favour for the following orders:- 26. ***Kshs. 8,333,333.30/- as at 31st August 2016.*** 27. ***Interest thereon at contractual rates of 10% per month as from 31st August, 2016 till payment in full.*** 28. ***Costs of the counterclaim, and*** 29. ***Any other relief the honourable court deems appropriate to grant.*** 30. The 3rd, 4th and 5th defendants filed their amended statement of defence dated 3rd March, 2025. The 3rd, 4th and 5th defendants denied the contents of the amended plaint and stated that if the suit property was charged to the 1st defendant, the same was done procedurally based on the documents presented by the 1st defendant. 31. The plaintiff filed his reply to the 1st defendant’s amended defence and counterclaim dated 13th September, 2024. He reiterated the contents of his amended plaint, denied the contents of the counterclaim and stated that the court lacks jurisdiction as far as accounting matters are concerned to entertain the 1st defendant’s amended counterclaim. 32. The plaintiff’s case proceeded for hearing on 23rd July, 2025. Emmanuel Karissa Kenga (PW1) introduced himself as a forensic examiner of more than 30 years. He stated that on instructions from the firm of Kakai Mugalo & Co. Advocates, he carried out an analysis of a conveyance dated 2nd May, 2005 and compared the signatures on the said document with the known signatures to determine the authenticity of the same. After examination, he could not find any agreement or similarities indicating that they are from a common origin or by the same author. He prepared the report dated 31st May, 2021 and produced the same as p. exhibit no. 1. 33. On cross-examination, PW1 testified that the photocopy and the original document dated 2nd February, 2005 registered on 13th April 2005, were drawn by the same lawyer and signed by the same land registrar. He stated that he requested for the original document but the same were not availed to him. Also, the charge document was not presented to him for examination. PW1 further informed the court that he did not take specimen signatures of one Lucy Nyaencha Waichari, and neither were any loan documents given for examination. He stated that his finding is an opinion as an expert. 34. On re-examination, PW1 stated that he had the original of A1 and obtained specimen signatures from the plaintiff. 35. The plaintiff (PW2) adopted his undated witness statement filed on 28th March, 2017 as his evidence in chief and produced p. exhibits no. 2 to 9 respectively. He also produced the documents contained in the supplementary list of documents as p. exhibits nos. 10 and 11 respectively. He stated that he does not know the 2nd defendant and neither has he ever interacted with him. He also informed the court that he does not know the 1st defendant and only went to their office to lodge his complaint after he learnt that his title had been used to charge the suit property. 36. On cross-examination, PW2 testified that in 2015, he wanted to sell a portion of the suit property and he needed Kshs.20,000,000/-. He entered into a sale agreement with Ronald Kairu to sell the portion for Kshs.17,300,000/-. He stated that he received Kshs.1,700,000/- and the subdivision was not done thus he was not able to complete the sale. He stated that he accrued penalties and while in a meeting held in April 2016 with a lawyer representing the purchaser, no one offered to pay him the penalties that he had incurred. He stated that in the course of the transaction, he did not give out his title at any given time, and that they used photocopies to facilitate the sub-division. While he refunded the purchaser the money, it was his testimony that the said refund did not come from the 1st defendant. 37. While being referred to the 1st defendant’s bundle of documents, PW2 stated that the signature was not his, and neither did he give the same to the document examiner. He stated that he was not aware that the 1st defendant dispatched Kshs. 5,000,000, /- as a loan and he only learnt of the same in court during hearing that the money was sent to the 2nd defendant. He admitted that his title was used as a guarantee and did not know how the 2nd defendant got hold of the conveyance documents. He also does not know whether the loan was advanced at the time when he was asked to refund the purchase price. While he lodged a complaint against the 1st defendant, he stated that none of the directors was charged. 38. On re-examination, PW2 testified that the meeting held at green mall was to prepare the deed for the vendor and purchaser and all along, he had the original title with him including during sub- division. He denied signing any document and while the charge was registered on 8th April 2016, he stated that he refunded the money to the purchaser’s advocates on 2nd February, 2017. He reiterated that he heard of the funds dispatched during the hearing of the criminal case against the 2nd defendant. With the testimony of PW2, the plaintiff rested his case. 39. The defendants’ case proceeded for hearing on 15th December, 2025. James Karebe (DW1) introduced himself as the recovery manager of the 1st defendant. He adopted his witness statement dated 25th January, 2019 as his evidence in chief and produced defendant’s exhibits 1 to 3 and d, exhibits nos. 4 to 6 respectively contained in the bundle of documents dated 18th June, 2018 and 25th January, 2019. DW1 stated that the 1st defendant has never received repayment of the loan advanced. 40. On cross-examination, DW1 testified that the loan was applied by Osman Abdullahi (2nd defendant) and guaranteed by the plaintiff. He stated that he was not aware of any previous relation between the 1st defendant and the plaintiff. While admitting that a valuation report is mandatory before the loan is disbursed, he stated that the same was not part of their documents. With regard to D.exhibit no. 3, DW1 stated that the 2nd defendant had requested for a loan of Kshs.10,000,000/- and the same was disbursed on 22nd March, 2016. With regard to D.exhibit no. 1, the charge document dated 8th April 2016, he stated that the same was charged after the loan had been disbursed. On being shown the charge sheet, DW1 agreed that the 2nd defendant used the same documents which he was found guilty on all five counts to charge the suit property. 41. According to him, the documents availed to the 1st defendant were not necessarily forged since they presented the same to the land registrar for registration. He stated that the person appeared before their advocate to charge the document, but he did not know one Mr. Phineas Mugambi. According to DW1 due diligence was conducted on the suit property and the plaintiff was confirmed to be the owner of the suit property. 42. On re-examination, DW1 reiterated that the charge was duly prepared and registered, and while a loan application form was filled, they released the loan amount which was a normal procedure. He further stated that the 1st defendant was satisfied with the process as they considered it proper. On the other hand, he said that the 1st defendant did not know the 2nd defendant before nor his relationship with the plaintiff and Phineas Mugambi. It was also his testimony that whatever the 2nd defendant stated in the criminal proceedings had nothing to do with the 1st defendant. The 3rd, 4th and 5th defendants opted not to call any witness. With that said, the defendants’ rested their case. 43. The parties filed their written submissions. The plaintiff filed written submissions dated 28th January 2026, the 1st defendant filed its written submissions dated 3rd March, 2026 while the 3rd, 4th and 5th defendants filed their written submissions dated 30th March, 2026. I have considered the pleadings, the testimonies of the witnesses, the evidence produced and the respective submissions filed. In my view, the issues for determination are as follows:- 44. *Whether the court has jurisdiction to hear and determine the amended counterclaim filed by the 1st defendant.* 45. *Whether the plaintiff has proved the allegations of fraud.* 46. *Whether the plaintiff is entitled to the orders sought in the amended plaint.* 47. In his reply to the amended defence and counterclaim, the plaintiff raised the issue on the jurisdiction of this court to hear and determine the amended counterclaim on account of the funds owed and he stated that this court has no jurisdiction over accounting matters hence the same falls within the jurisdiction of the high court commercial division. On jurisdiction, it has been stated that the court is required to down its tools once it is established that it has no jurisdiction, and if it proceeds to do so in disregard of the same, then everything else that follows thereafter becomes a nullity. In this case, the 1st defendant in its counterclaim stated that its claim against the plaintiff and the 2nd defendant is in the sum of Kshs.8,333,333.30/- which is the outstanding balance as at 31st August, 2016 and that the same continues to accrue interest. To begin with, and during the 1st defendant’s hearing, DW1 did not bring up this claim against the plaintiff and the 2nd defendant. He was mute, and it is not clear whether this was abandoned or not. However, and to get into the details of it, the 1st defendant pleaded that the plaintiff offered to guarantee the 2nd defendant and used the title of the suit property as security for the loan which was registered on 11th April, 2016. During the hearing, DW1 maintained that due diligence was conducted before the charge was registered and the loan was disbursed accordingly. 48. It follows therefore that this claim can only be pursued at the commercial division of the high court for determination. I agree with the plaintiff on this issue and I place reliance on the case of **Co-operative Bank of Kenya Limited v Njuguna & 5 others [2017] KECA 79 (KLR)**, where the court of appeal held that:- ***“While exclusive, the jurisdiction of the ELC is limited to the areas specified under Article 162 of***[***the Constitution***](https://new.kenyalaw.org/akn/ke/act/2010/constitution)***, Section 13 of the ELC Act and Section 150 of the Land Act; none of which concern the determination of accounting questions. Consequently, this dispute does not fall within any of the areas envisioned by the said provisions. On the other hand, the jurisdiction of the High Court over accounting matters is without doubt, for under Article 165(3) of***[***the Constitution***](https://new.kenyalaw.org/akn/ke/act/2010/constitution)***provides inter alia, that;…”*** 1. For this reason, this court has no jurisdiction to determine the issue of any outstanding amount due and owing to the 1st defendant. The amended counterclaim dated 9th September, 2024 is hereby struck out with costs to the plaintiff. 2. Turning to the merits or otherwise of the main suit, it was the plaintiff’s case that since he acquired the suit property through purchase sometime in 2005, he has been in peaceful and quiet use of the same. That sometime in December 2015, he wanted to sell a portion of the suit property, and he entered into an agreement with Ronald Kairu. Thereafter, and while he was commencing the sub-division process, he realized that the suit property had been fraudulently charged to the 1st defendant which prompted him to make a follow up. He went to the 1st defendant to enquire about the same and later lodged a complaint at central police station. From the record, the 2nd defendant was arrested, charged and convicted of the 5 counts that he was charged under. 3. The second issue for determination is whether the plaintiff has proved the allegations of fraud as particularized in the amended plaint. It is settled law that fraud is a serious accusation which procedurally has to be pleaded and proved to a standard above a balance of probabilities but not beyond reasonable doubt. In the case of [**Vijay Morjaria vs Nansingh Madhusingh Darbar & Another**](https://new.kenyalaw.org/akn/ke/judgment/keca/2000/223)**[2000] eKLR,** it was stated as follows:- ***“It is well established that fraud must be specifically pleaded and that particulars of the fraud alleged must be stated on the face of the pleading. The acts alleged to be fraudulent must, of course, be set out, and then it should be stated that these acts were done fraudulently. It is also settled law that fraudulent conduct must be distinctly alleged and distinctly proved, and it is not allowable to leave fraud to be inferred from the facts.”*** 1. The plaintiff pleaded particulars of fraud against the 1st, 2nd and 3rd at length. PW1 tested the plaintiff’s signature based on the conveyance dated 2nd February 2005, his known signatures and a signature said to be that of Lucy Nyaencha. He found no similarities to the questioned signatures. This evidence was not rebutted save that the 1st defendant questioned whether they obtained the signature of the said Lucy Nyaencha. From this report, it was clear that the specimen signature of Lucy Nyaencha was not sought. The mere fact that her original signature was not sought does not negate the fact that forgery of the specimen signatures used were established. Secondly, there is evidence that the 2nd defendant was found guilty of forgery on five counts and there is no appeal brought before court to confirm that the decision of the criminal court was overturned. In a judgment delivered on 2nd February 2024, the subordinate court found him guilty and proceeded to convict him accordingly. 2. From the testimonies of PW2 and DW1, it was clear that there was no relationship between the plaintiff and the 1st defendant, because according to DW1, he had never seen the plaintiff. I also note that while the plaintiff was in need of money to repay the purchase price, it would have made sense for him to borrow from the 1st defendant directly since he had a title registered in his name that he could use as collateral. Equally so, and if the monies were disbursed to repay the same, the plaintiff would have done so immediately and not in 2017 as he stated. Also, even if the plaintiff could not borrow directly from the 1st defendant and needed to use the 2nd defendant, it meant that the 2nd defendant had an existing good relationship with the 1st defendant to enable it to disburse funds in the manner that it did. In this case, it is clear that the 2nd defendant was also not well known to the 1st defendant to the extent of releasing the funds before the charge had been registered. 3. In my view, the 2nd defendant fraudulently used the plaintiff’s title documents and obtained a loan from the 1st defendant. If indeed the 1st defendant was satisfied that the suit property was procedurally registered, I believe it would have called a document examiner to confirm that the signature in the charge belonged to the plaintiff. In addition, I have noted some discrepancies with the manner in which the 1st defendant disbursed the funds. The charge registered against the title indicates the amount charged is Kshs.10,000,000/-. The amounts disbursed on 22nd March, 2016 is Kshs.5,000,000/-. I see a lot of mischief surrounding this transaction to the extent that if a serious financial institution is keen to make profits from loan disbursed, it would mean that they would follow due process before releasing any funds. In this case, the charge was registered on 12th April, 2016 after the loan had been disbursed. Secondly, and following any default in terms of repayment, there are strict timelines for realization of the unpaid amounts. There is no notice issued to the plaintiff except the 2nd defendant indicating its intention to exercise its statutory power of sale over the suit property in realization of such as per clause 7 of the charge. 4. Having examined the evidence tendered, I find the process within which the 1st defendant used to disburse the loan questionable to lead me to the conclusion that it may have acted in collusion with the 2nd defendant to register the charge fraudulently. It follows that the registration of the charge was equally unlawful, thus null and void. 5. Let me also say that the trespass and any illegal activities on the suit property were not proved. In addition, the prayers sought against the 3rd, 4th and 5th defendants were not proved to the required standard. It was not shown how the 3rd, 4th and 5th defendants participated in the fraudulent scheme. On the other hand, the orders sought against the 4th defendant are not within this court’s powers to issue. The expeditious disposal of criminal matters lies with the high court and the magistrates’ courts. 6. From the above, I find merit in the amended plaint dated 7th November, 2023 and I grant the following orders:- 7. ***A declaration is hereby issued that the plaintiff is the registered owner of land reference no. 5892/10 situated in Karen, Ololua ridge.*** 8. ***A permanent injunction is hereby issued against the defendants restraining them from interfering with the suit property known as land reference no. 5892/10 situated in Karen, Ololua ridge.*** 9. ***A declaration is hereby issued that the charge dated 8th April, 2016 and registered on 12th April, 2016 is fraudulent therefore null and void. It is hereby cancelled.*** 10. ***The 3rd defendant is hereby directed to rectify the register cancelling and revoking the charge instrument pursuant to order 3 above.*** 11. ***The plaintiff is awarded costs of the amended plaint. The same to be borne by the 1st and 2nd defendants.*** 12. ***The 1st defendant’s amended counterclaim dated 9th September, 2024 is hereby struck out with costs to the plaintiff.*** It is so ordered. **DATED, SIGNED & DELIVERED VIRTUALLY THIS** **12TH DAY OF AUGUST, 2026.** **HON. MBOGO C.G.** **JUDGE** **12/08/2026.** ***In the presence of:-*** *Mr. Benson Agunga – Court assistant* *Ms. Talu holding brief for Mr. Mugalo for the Plaintiff* *Ms. Muthee holding brief for Mr. Kirimi for the 1st Defendant* *Ms. Kubai for the 3rd to 5th Defendants*