[2016] KECA 589 (KLR)

IN THE COURT OF APPEAL

AT NAIROBI

(CORAM: KOOME, OKWENGU & OTIENO-ODEK, JJ.A.)

CIVIL APPEAL NO. 203 OF 2012

BETWEEN

CHARLES MUGANE NJONJO …...........…… 1st APPELLANT

SOLIO RANCH LIMITED ……………....…… 2nd APPELLANT

AND

GUCOKANIRIA KIHATO TRADERS AND

FARMERS COMPANY LIMITED ……........…… 1st RESPONDENT

ATTORNEY GENERAL ………….......………… 2nd RESPONDENT

(An appeal from the Ruling and Order of the High Court of Kenya at Nairobi (Mbogholi Msagah. J.) dated 10th December 2009

in

H.C.C. No. 1251 of 2002)

***************

JUDGMENT OF THE COURT

1. This is an appeal against the decision of the trial court declining to strike out a plaint filed by the 1st respondent, GUCOKANIRIA KIHATO TRADERS AND FARMERS COMPANY LIMITED, against the 1st and 2nd appellants,CHARLES MUGANE NJONJOandSOLIO RANCH LIMITEDrespectively, in a dispute relating to title and ownership of LR. No. 11571 situated in Laikipia District otherwise known as Solio Ranch, and hereinafter referred to as the suit property.

2. The 2nd appellant, Solio Ranch Limited, is the registered proprietor of the suit property and its Certificate of Title was issued on 26th November 1965 under the provisions of the then Registration of Titles Act, Cap 281 of the Laws of Kenya.

3. In the plaint, the 1st respondent, a land buying company contends that the suit property was allocated to its members by the late President Jomo Kenyatta on 10th March 1973; that the suit property as at 10th March 1973 was unalienated government land; that on 14th March 1973, the 1st appellant being the then Attorney General of the Republic of Kenya ordered the Chairman of the 1st respondent company to surrender the letter of allotment and other documents of title relating to the respondent’s claim to ownership of the suit property; that when the Chairman of the 1st respondent company failed to surrender the allotment and ownership documents, the 1st appellant in his capacity as the Attorney General instructed the Kenya Police to raid the 1st respondent company offices then situated at Cross-Road in Nairobi; that on 16th March 1973, the police raided the 1st respondent’s offices and seized the 1st respondent’s letter of allocation and documents of ownership to the suit property; that the 1st respondents documents were taken away from its offices through acts of abuse of power, corruption, abuse of office and fraud perpetrated by the 1st appellant, and that subsequent to the raid, the 1st appellant instructed the Police to ensure that no member of the 1st respondent company entered the suit property; that the 1st appellant then procured registration of the title to the suit property in the name of the 2nd appellant.

4. The 1st respondent in its plaint seeks against the 2nd respondent an order to compel the police to return the documents taken away from its offices; It further seeks an order directed to the Commissioner of Lands and or Chief Land Registrar to issue it with a new allotment letter to the suit property; alternatively, it prays for compensation by way of allotment of an alternative equivalent land and compensation for loss of investment opportunity and or money value of the suit property at current market rate and further prays that the title issued to the 2nd appellant in respect of the suit property be nullified.

5. The Attorney General in a defence dated 26th October 2003 at paragraph 2a thereof avers that the suit property LR NO. 11571/R is owned by the Government of Kenya by virtue of Notice of Taking Possession which was registered on 15th February 1991. At paragraph 5a of the defence, it is averred that the suit property has never been allotted to any one and more particularly to the 1st respondent.

6. The 2nd appellant herein in its Defence and Counterclaim dated 16th March 2007 averred that it is the registered proprietor of the suit property and its Certificate of Title dated 26th November 1965 granted it a term of 944 years with effect from 1st August 1965. The 2nd appellant contends that its Certificate of Title is indefeasible under the provisions of Section 23 of the Registration of Titles Act.

7. The 1st appellant in his defence denied in toto the allegations of fraud; he denied the averments of abuse of office and corruption and further denied that he ordered the police to raid the 1st respondent company offices. He reiterated that the 2nd appellant is the indefeasible registered proprietor of the suit property; and that the said property was not unalienated government land.

8. By a Chamber Summons application dated 29th October 2008, the appellants made an application seeking orders to strike out the 1st respondent’s plaint on the ground that it disclosed no reasonable cause of action; that the claim in the plaint was frivolous, vexatious and otherwise an abuse of court process.

9. Upon hearing the parties, the learned judge dismissed the Chamber Summons application and expressed as follows:

“Some of the outstanding principles are that a statement of claim should not be struck out and the plaintiff driven from the judgment seat unless the case is unarguable….It is also an established practice that the courts should strive to maintain suits rather than strike out or dismiss the same. I have related the pleadings, the facts and the cited authorities herein. I am persuaded that the interest of justice shall best be served bymaintaining the plaintiff’s suit. The amended plaint discloses not one but several triable issues which can only be determined by evidence in a main trial. Summary procedure such as sought….is likely to result in injustice on the part of the plaintiff if allowed. Accordingly, the application dated 29thOctober 2008 is hereby dismissed with costs.”

10. Aggrieved by the ruling, the appellants have lodged the instant appeal citing the following compressed grounds:

“(i) The learned judge erred in failing to consider the submissions made by the appellant in support of the application.

The judge erred in failing to consider that the 2ndappellant had an indefeasible title over LR No. 11571 (the suit property) which was protected by the provisionsof Section 23 of the Registration of Titles Act, Cap 281 of the Laws of Kenya and that the suit property was not available for allotment and allocation at any time to the 1strespondent.

The learned judge erred in finding that the plaint disclosed triable issues and also erred in failing to make findings on the issues said to be triable.

That the 1strespondent’s case is not sustainable against the appellants and the judge erred in finding thatsummary procedure is likely to result in injustice on the part of the 1strespondent while such procedure is allowed by statute.

The learned judge erred in failing to find that the plaint did not disclose a reasonable cause of action, was frivolous, vexatious and otherwise an abuse of the court process.”

11. At the hearing of this appeal, learned counsel Ms Irene Kashindi holding brief for Mr. Kiragu Kimani appeared for the appellants while learned counsel Mr. Anthony Burugu appeared for the 1st respondent and learned counsel Ms Damaris Ogama appeared for the 2nd respondent. All counsel filed written submissions and made oral highlights during the hearing of the appeal.

12. The appellant reiterated the grounds of appeal and submitted that the learned judge erred in failing to find that the plaint did not disclose a reasonable cause of action; that under Order 2 Rule 15 (1) of the Civil Procedure Act and Rules; the court has discretion at any stage of the proceedings to strike out or amend any pleading on the ground that it discloses no reasonable cause of action. Citing the decision inMary Kalolia Mutisya -v- Joel Ngui Mweu(2005) eKLRthe appellant submitted that an action has some chances of success when only the allegation in the plaint or pleadings are considered (sic). Counsel submitted that the plaint discloses no reasonable cause of action because there is no allegation of wrong doing, fraud or misrepresentation against the 2nd appellant and no evidence of wrongdoing on the part of the 1st appellant; it was submitted that the Certificate of Title produced by the 2nd appellant indicates that the title to the suit property is vested on the 2nd appellant and the said title is indefeasible; that as at 10th March 1973, the suit property was not unalienated government land and was not available for allotment to the 1st respondent; that the alleged allotment made by the late President Jomo Kenyatta does not amount to a grant of title; that the late President Kenyatta could not have allocated land that the government did not own and that only unalienated government land can be allotted and allocated.

13. Counsel emphasized that the 2nd appellant’s title was indefeasible pursuant toSection 23 (1)of theRegistration of Titles Act. Citing the dicta inMuchendu - v- Waita (2003) KLR 419andRosky Traders Limited -v- Getrude Chao Waita & 2 others (2013) eKLR, the appellants submitted that a Certificate of Title is conclusive evidence that the person named therein is proprietor of the land and is the absolute and indefeasible owner thereof. The appellant also cited the decision in Wreck Motors -v- Commissioner of Lands Civil Appeal No. 71 of 1997to support the submission that as the pleadings did not disclose any fraud on the part of the second appellant, the trial court erred in failing to strike out the plaint; that the 2nd appellant’s title can only be challenged on grounds of fraud or misrepresentation; that the amended plaint does not contain any allegation of wrong doing against the 2nd appellant.

14. The appellant submitted that the 1st respondent’s claim in the plaint was frivolous as it is premised on a letter of allotment that cannot overrule a Certificate of Title; that the suit is scandalous as it seeks to disabuse the 2nd appellant its quiet possession of the suit property and that the 1st respondent failed to provide any evidence in support of the allegation of abuse of office.

15. In further support of its submission, the appellants submitted that the learned judge erred in not taking into account that the 1st respondent’s replying affidavit; that the said replying affidavit did not address the allegations of fact raised by the appellant in seeking to strike out the plaint and that the trial court erred in not identifying the trial issues disclosed in the plaint. The appellant cited dicta in the cases of Pan African Bank Limited -v- Gulmareba Limited & 2 others (2006) eKLRandTermco Tank (K) Limited -v- Nyoro Construction Company Limited (2004) eKLR. In concluding submissions, the appellant cited the case ofKenya Commercial Bank Limited -v- Suntra Investments Bank Limited(2015) eKLRand urged this Court to strike out the 1st respondent’s suit as being frivolous.

16. The 1st and 2nd respondents opposed the appeal. The 1st respondent submitted that soon after Kenya’s independence, it identified the suit property and applied for the same to be allocated to its members; that on 14th March 1973, the 1st respondent received a letter authorizing allocation of the suit property to its members; that the letter dated 14th March 1973 and other documents were forcibly taken away by Police on instructions of the 1st appellant; that due to difficulty in obtaining audience with the late President Jomo Kenyatta, the 1st respondent was not able to bring to his attention the new developments; that the 1st respondent has pursued to ownership of the suit property diligently and with passion; that the trial judge correctly exercised his discretion and refused to strike out the 1st respondent’s suit; that the appellants joined the suit so that they could be given an opportunity to be heard and that the 1st respondent should not be denied the opportunity to canvass its case on merits.

17. The 1st respondent cited the decision in Mbogo & another -v- Shah (1968) EA 93to support the principle that this Court should not interfere with the exercise of discretion by the trial judge who correctly declined to strike out the plaint. Also the case of Dyson -v- Attorney General (1911) KB 410 at 419 was cited to support the proposition that the judicial system should never permit a plaintiff to be driven from the judgment seat without any court having considered his right to be heard except in cases where the cause of action was obviously and almost incontestably bad.

18. The 2nd respondent, the Attorney General, in opposing the appeal submitted that the plaint as filed raises a triable issue as to the ownership of the suit property; that other triable issues relate to the regularity and validity of the letter of allotment and title documents to the suit property; the allegation of fraud made in the plaint and the issue of res judicata and non-joinder of parties. It was submitted that all these issues are alive and require determination on merit in a full hearing and trial of the dispute between the parties. The 2nd respondent cited the decision in Lalji t/a Vakkep Building Contractors -v- Casousel Limited (1989) KLR 386in support of submissions where this Court held that summary judgment is a draconian measure and should be given in only the clearest of cases. It was submitted that it is trite law that a trial must be ordered if one issue which is fairly arguable is found to exist.

19. We have re-evaluated the record of appeal, considered submissions by counsel and the authorities cited. We have carefully examined the plaint and defences filed to ascertain if any triable issue is disclosed by the pleadings. The appellants’ application to strike out the 1st respondent’s plaint is akin to an application for summary judgment. We concur with the dicta in Commercial Advertising andGeneral Agencies Ltd. -v- Qureishi(1985) KLR 458where it was stated that on an application for summary judgment, the plaint, defence, counterclaim and reply to defence, if any, and affidavits in support and in reply as well as all relevant issues and circumstances are all proper material for consideration.

20. The key issue in this appeal is whether the trial judge correctly exercised his discretion in declining to strike out the plaint filed by the 1st respondent. It is not in dispute that the decision to strike out a suit or pleading is a discretion bestowed upon the trial court; however, such discretion must be judiciously exercised. We take cognizance of the dicta by Madan, J. in CA Civil Appeal No. 33 of 1977 B. Gupta -v- Continental Builders Limitedwhere he stated that if a defendant is able to raise a prima facie triable issue, he is entitled in law to defend.

21. If the appellant’s application to strike out the 1st respondent’s suit is granted, the dispute between the parties shall have been summarily determined without a hearing on merits. The right to be heard which encompasses the right of audience must be jealously guarded. The right to be heard is a fundamental right, and as this Court observed in the case of Richard Ncharpi Leiyagu -vs- Independent Electoral and Boundaries Commission and 2 Others,C.A. No. 18 of 2013, Nyeri:“The right to a hearing has always been a well protected right in our Constitution and is also the cornerstone of the rule of law.”

22. The appellants contends that the trial judge erred in failing to identify the triable issues. The 2nd respondent in submissions before this Court identified the triableissues to include contestation as to the ownership of the suit property, regularity and validity of the letter of allotment and consideration of the allegation of fraud as pleaded in the plaint.

23. Triable issues are discernible from the pleadings filed by the parties; a claim in the plaint that is denied in the defence becomes a triable issue. The appellants filed their defences in the suit and denied in entirety the allegations of fact contained in the plaint; the appellants specifically denied the 1st respondent’s claim to ownership of the suit property; the appellants further averred that the suit property was unalienated government land and was not available for allocation to the 1st respondent. In denying the allegations of fact and claims made in the plaint, a joinder of triable issues occurred.

24. It is trite that joinder of issue occurs when the defendant has challenged (denied) some or all of the plaintiffs allegations of fact and/or when it is known which legal questions are in dispute. Joinder of issue is the act by which a party in a dispute by his pleadings asserts a fact to be so, and the other party denies it. In this case, the plaint and the defences filed and the counterclaim disclose joinder of triable issues.

25. The plaint specifically alleges fraud and abuse of office on the part of the 1st appellant. A general principle of law is that whenever fraud is pleaded, this issue should not be determined summarily but upon consideration of evidence. We note that the 2nd appellant submitted that no allegation of fraud or misconduct has been alleged on its part. This submission is not entirely correct. The plaint specifically alleges that the 2nd appellant improperly acquired its title through fraud and abuse of office by the 1st appellant. If the allegations against the 1st appellant were to be proved, this would taint the Certificate of Title issued to the 2nd appellant. The contestation as to fraud and abuse of office by the 1st appellant is intertwined withthe issue as to whether Section 23 of the RTA is applicable to impeach the 2nd appellant’s title on ground of fraud.

26. The 2nd appellant contends that Section 23 of the RTA confers upon it an indefeasible title to the suit property. Conversely, 1st respondent contends that the title issued to the 2nd appellant was procured by fraud. In Sunderji -v- Clyde House Company Limited, (1984) KLR 499this Court stated that where an issue raised requires reference to applicable law in order to reach a decision, such an issue should be tried with full argument on the law and should not be dealt with summarily. In our view, whether Section 23 of the RTA applies to the Certificate of Title granted to the 2nd appellant and whether the said Certificate is impeachable on the basis that it was procured by fraud is a triable issue that requires trial and the taking of evidence.

27. The 1st respondent alleges in its plaint that the 1st appellant abused his office and exercised his powers as the Attorney General in a fraudulent manner. In Mbuthia-v- Jimba Credit Finance Corporation & Another(1988) KLR 1,this Court observed that the question whether an individual has exercised his powers in a fraudulent manner is a matter of evidence and is a dispute of fact to be resolved by trial. We are of the view that the alleged fraud and abuse of office on the part of the 1st appellant is a triable issue.

28. We note that the 2nd appellant filed a counterclaim alleging it has a right to possession of the suit property and it seeks injunctive orders to restrain the 1st appellant and its members from accessing the suit property. The 1st respondent averred it has a right to ownership and possession of the suit property. These diverse contestations constitute triable issues. In Doge -v- Kenya Canners Limited, 1985 KLR 942, it was stated that if a counterclaim contains arguable issues, the counterclaim discloses triable issues that are subject to trial.

29. Guided by the judicial decisions cited above, we are of the considered view that the trial court did not err in declining to strike out the plaint filed by the 1st respondent. We are satisfied that there is joinder of various triable issues disclosed in the pleadings; the plaint and defences filed disclose disputed and contested facts whose truth and veracity can only be resolved by way of trial and full hearing. The appellants submitted that there is no evidence of wrongdoing on the part of the 1st appellant. Where would the evidence come from without trial and hearing? An indefeasible Certificate of Title shall always remain indefeasible if lawfully acquired. If the 2nd appellant’s Certificate of Title is indefeasible, we fail to see what prejudice the appellants shall suffer if a full trial and hearing is conducted where its Certificate of Title is produced in evidence.

30. In totality, we find this appeal has no merit and is hereby dismissed with costs.

Dated and delivered at Nairobi this 6thday of May, 2016.

M. K. KOOME

JUDGE OF APPEAL

H. M. OKWENGU

JUDGE OF APPEAL

J. OTIENO-ODEK

JUDGE OF APPEAL

I certify that this is a true copy of the original.

DEPUTY REGISTRAR