https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/8722

Gatamaiyu Dairy Farmers Co-operative Society Ltd v Limuru Posho Mill Ltd (Civil Appeal E039 of 2024) [2026] KEHC 8722 (KLR) (19 June 2026) (Judgment) Neutral citation: [2026] KEHC 8722 (KLR) Republic of Kenya In the High Court at Kiambu Civil Appeal E039 of 2024 KL Kandet, J June 19, 2026 Between Gatamaiyu Dairy Farmers Co-operative Society Ltd Appellant and Limuru Posho Mill Ltd Respondent (Being an Appeal from the Ruling of the Honourable Olwande, Senior Principal Magistrate in Limuru CMCC No. 36 of 2015 delivered on 18th July, 2019) Judgment 1.This is an appeal filed by Gatamaiyu Dairy Farmers Co-operative Society Ltd (hereinafter referred to as "the Appellant") against the ruling of the Honourable Senior Principal Magistrate, Hon E. Olwande, delivered on 18th July 2019, in Limuru Chief Magistrates Court Civil Case No. 36 of 2015. The ruling allowed the Respondent's application for execution of a decree against the Appellant by way of attachment and sale of immovable property known as Land Title No. Gatamaiyu/Kagwe/T.146. 2.The Respondent, Limuru Posho Mill Ltd, is a limited liability company incorporated and carrying on business in Limuru within the Republic of Kenya and was the Plaintiff in the lower court proceedings. The Appellant is a registered co-operative society and was the Defendant in those proceedings. 3.The Respondent, a manufacturer and seller of animal feeds, supplied various feed products to the Appellant on credit. The Appellant received and was invoiced for the said goods.A running account statement produced by the Respondent shows deliveries made in the years 2012 and 2013, resulting in a principal outstanding balance of Kshs.1,227,000/-. 4.Despite repeated demands, written correspondence, and the Appellant's own letters acknowledging the debt and seeking time to pay including letters dated 16th March 2013, 3rd April 2013, 17th March 2014, and 24th May 2014 the Appellant failed to make payment. The Appellant attributed its inability to pay to financial difficulties occasioned by mismanagement of a previous board and a forensic audit then being conducted by the Lari District Co-operative Officer. 5.The Respondent filed suit on 10th February 2015 before the Chief Magistrates Court at Limuru, Civil Suit No. 36 of 2015. Following a full hearing, judgment was delivered on 17th November 2016 by Hon. G. H. Odour, Chief Magistrate, in favour of the Respondent. A decree was issued in the sum of Kshs.1,227,000/- together with interest at 12% per annum and costs of the suit, totalling Kshs.1,250,000/- in principal and interest, and Kshs.190,730/= in certified costs. 6.On 13th February 2019, the Respondent filed a Notice to Show Cause requiring the Appellant to appear and show cause why execution should not issue, specifically seeking to attach and sell the Appellant's immovable property, Land Title No. Gatamaiyu/Kagwe/T.146. The Appellant was served on 18th February 2019. 7.The Appellant filed an Affidavit in Response to the Notice to Show Cause, sworn on 13th March 2019 by one David Irungu Kiiru, the Society's Manager. The Appellant contended, inter alia, that: (a) the proposed mode of attachment was unlawful; (b) the title to the said property was still held by K-Unity Savings and Credit Co-operative Society Limited as collateral security for a loan facility of Kshs.63,366,922.19/- and (c) that the execution of the decree should be suspended for at least one year to allow the Appellant to either pay or propose a payment plan. 8.The Respondent filed an affidavit in reply, sworn on 20th May 2019 by Jamal Awale, a director of the Respondent company. The Respondent challenged the Appellant's contentions, pointing out that a search at the Lands Office revealed that the only registered charge on the property was in the sum of Kshs.2,000,000/- in favour of Kiambu Dairy and Pyrethrum Co-operative Union not K-Unity Savings and Credit Co-operative Society Limited and disputed the genuineness of the Appellant's claims regarding encumbrance. 9.On 18th July 2019, the learned trial Magistrate delivered a ruling allowing execution to proceed. It is against that ruling that the Appellant now appeals to this Court. 10.The Memorandum of Appeal filed on 13th March 2024 sets out five grounds of appeal, which I summarise as follows:i.That the learned Senior Principal Magistrate erred in law and in fact by allowing an application whose proposed mode of attachment derogates from what is prescribed by law and cannot be legally granted.ii.That the learned Senior Principal Magistrate erred in law and in fact in allowing the attachment of an immovable asset whose title is still held by another financier as security.iii.That the learned Magistrate erred in law and in fact in allowing execution without considering the Appellant's affidavit in response to the Notice to Show Cause.iv.That the learned trial Magistrate erred in law and in fact by failing to consider the Appellant's justifiable grounds adduced for extension of time within which to comply with the satisfaction of the decree.v.That the learned trial Magistrate erred in law and in fact in allowing the Respondent's application for Notice to Show Cause despite the same being unmeritorious. 11.By the Memorandum of Appeal, the Appellant prays that:i.the ruling and decree of the lower court be set aside; andii.an order of stay of execution of the decree be granted. 12.The Record of Appeal filed on 18th June 2024 contains documentary exhibits including the K-Unity’s letter of 1st March 2019 confirming that it holds the title deed for Plot Gatamaiyu/Kagwe/T.146 as collateral against loans and overdraft of Kshs.63,386,922.19, together with a detailed K-Unity account statement covering the period 1st September 2012 to 1st March 2019, showing a closing balance of Kshs.56,548,882.94 as at that date. 13.The Record also contains the Green Card (Register of Title) for Plot No. Gatamaiyu/Kagwe/T.146, showing that the registered proprietor is Gatamaiyu Dairy Farmers Co-operative Society Ltd. Entry No. 3 on the Green Card records a restriction registered on 21st April 1970 14.The Respondent filed a Replying Affidavit in a related Environment and Land Court proceedings at Thika (Miscellaneous Application No. E008 of 2025), sworn on 30th December 2025 by Suad Abdi Hassan Ali, 15.The Appellant through Counsel on record filed written submissions dated 21st October 2025. The Appellant submits that the learned trial Magistrate erred by allowing attachment of immovable property that was encumbered and held as security by a third-party financier. The Appellant relies on Order 22 Rule 48 of the Civil Procedure Rules, which governs attachment of immovable property and provides that attachment is to be made by way of a prohibitory order registered against the title. The Appellant argues that an immovable property can only be attached where the judgment debtor holds a legally attachable and unencumbered interest in it, and where the property is charged to another party, the attaching party must first establish that the debtor's equity of redemption is free and available. 16.In support of this proposition, the Appellant cites the High Court decision in In re Hi-Plast Ltd [2019] KEHC 5014 (KLR), wherein the Court held that a registered charge confers upon the chargee a proprietary interest that ranks in priority over all other creditors, including judgment creditors, trade creditors, and unsecured creditors. The Appellant submits that allowing the attachment of property already charged to K-Unity derogates from K-Unity's superior secured interest and is legally untenable. 17.The Appellant submits that the learned trial Magistrate erred by proceeding to allow execution without considering the substance of the Affidavit in response to the Notice to Show Cause filed by the Appellant. The Appellant contends that had the affidavit been properly considered, the court would have been guided on whether to grant or refuse execution. Reliance is placed on Wells Fargo Limited v Cyrus Kioko & 48 Others [2015] KECA 361 (KLR), citing with approval Mbogo & Another v Shah (1968) EA 93, which holds that an appellate court will interfere where a lower court misdirected itself, acted on wrong principles, or failed to take into account relevant matters, thereby arriving at a wrong conclusion. 18.The Appellant submits that the learned trial Magistrate erred by failing to consider the Appellant's grounds for an extension of time to satisfy the decree. Reference was made to Order 50 Rule 6 of the Civil Procedure Rules, which vests in the court discretion to enlarge time upon such terms as justice requires. The Appellant further invokes Article 159(2)(d) of the Constitution, which requires courts to administer substantive justice without undue regard to procedural technicalities. The Appellant also cites the South African Labour Court decision in National Union of Mineworkers v Council for Mineral Technology [1998] ZALAC 22, which sets out the factors relevant to the exercise of discretion in extension of time applications, including the degree of delay, the explanation offered, and the prospects of success. 19.The Appellant urges the Court to find that the learned trial Magistrate misdirected herself in law and in fact by sanctioning irregular execution proceedings, and prays that the appeal be allowed with costs to the Appellant. 20.The Respondent through Counsel on record filed written submissions dated 26th January 2026, in opposition to the appeal. 21.The Respondent submits that the law clearly permits the disposal of a judgment debtor's immovable property in satisfaction of a court decree. Reliance is placed on Section 44 of the Civil Procedure Act, which provides that all property belonging to a judgment debtor including property over which the debtor has a disposing power exercisable for his own benefit, whether held in his name or in the name of another on his behalf is liable to attachment and sale in execution of a decree. The Respondent further relies on Order 22 Rule 68 of the Civil Procedure Rules 2010, which provides that the sale of immovable property in execution of decrees may be ordered by any court. 22.On the question of the encumbrance, the Respondent submits that the Green Card for Land Title No. Gatamaiyu/Kagwe/T.146 shows that the only registered charge on the property is in favour of the Kiambu Dairy and Pyrethrum Co-operative Union, registered on 13th August 2004 more than twenty years before the filing of the appeal. The Respondent contends that the Appellant never provided evidence before the trial court to establish that it had defaulted on any loan to K-Unity, nor did it adduce evidence of an existing, enforceable loan facility with K-Unity in the execution proceedings. 23.The Respondent further submits that the Appellant had the opportunity to enjoin K-Unity Cooperative Society Limited as an interested party to support its assertion, which it never did. It is submitted that the Appellant cannot make bare allegations of encumbrance without evidence and expect the court to rule in its favour, invoking the maxim that "he who alleges must prove." Reference is made to Section 107(1) of the Evidence Act, which provides that the burden of proof lies on the party who asserts a fact. 24.The Respondent also relies on the case of Githuka v Njau (Environmental and Land Originating Summons E010 of 2023) [2025] KEELC 8130 (KLR), in which the Environment and Land Court at Thika held that a Green Card is a crucial piece of documentary evidence, not as proof of title for the claimant, but to establish the identity of the registered proprietor against whom a claim is made and the history of the land. The Respondent argues that mere registration of a charge on the Green Card is not proof that the Appellant is in default of payment, and that the Appellant cannot rely on the existence of a charge entry as evidence of an encumbered property that is immune from execution. 25.The Respondent urges the Court to dismiss the appeal with costs, on the ground that the appeal is designed to deny the Respondent the fruits of a judgment validly obtained after a full trial before the lower court, and that the Appellant has since the year 2013 been pleading for time without making any payment whatsoever towards the decretal sum. Analysis And Determination 26.I have carefully considered the pleadings, the record of appeal, the written submissions filed by both parties, and the applicable law. The duty of this Court sitting as a first appellate court is well settled. This Court is required to re-evaluate the evidence and arrive at its own conclusions, always bearing in mind that the trial court had the advantage of seeing the witnesses testify. Where, however, as in the case before me, the appeal turns substantially on questions of law and the exercise of judicial discretion, this Court is entitled to and must intervene where satisfied that the discretion was exercised on wrong principles or based on irrelevant considerations. See Selle v Associated Motor Boat Co [1968] EA 123. 27.The issues for determination in this appeal are:i.Whether the proposed mode of attachment of the Appellant's immovable property was lawful;ii.Whether the property sought to be attached was encumbered so as to render it unavailable for execution;iii.Whether the learned trial Magistrate failed to consider the Appellant's Affidavit in Response to the Notice to Show Cause; andiv.Whether the trial court erred in failing to grant the Appellant an extension of time within which to satisfy the decree. 28.The Appellant contends that the proposed mode of attachment derogated from what is prescribed by law and could not be legally granted. However, a careful perusal of Order 22 Rule 48 of the Civil Procedure Rules relied upon by the Appellant itself reveals that the lawful mode of attaching immovable property is by way of a prohibitory order registered against the title. There is no evidence before this Court, nor is it pleaded, that the Respondent sought to attach the property by any irregular mode. Indeed, the Green Card on record shows that a restriction was duly registered as Entry No. 6 on 22nd September 2016 pending the determination of the civil suit, consistent with the procedure prescribed by law. The Appellant has not demonstrated, beyond a bare assertion, the specific manner in which the proposed attachment departed from the prescribed legal mode. I therefore find no merit on that assertion. 29.The Appellant contends that Land Title No. Gatamaiyu/Kagwe/T.146 was held by K-Unity Savings and Credit Co-operative Society Ltd as security for a loan of Kshs.63,366,922.19/- and therefore could not lawfully be attached in execution of a decree in favour of the Respondent. 30.The Appellant annexed to the record a letter dated 1st March 2019 from K-Unity's Chief Executive Officer,confirming that it holds the title deed as collateral against loans and overdraft aggregating Kshs.63,386,922.19/-. A detailed K-Unity account statement for the period 1st September 2012 to 1st March 2019 is also annexed, reflecting a closing balance of Kshs.56,548,882.94/-.According to the Appellant, this constitutes prima facie evidence that the property was charged to K-Unity and that the title was physically held by it. 31.The Respondent counters that the only charge reflected on the Green Card of the property is in favour of Kiambu Dairy and Pyrethrum Co-operative Union, registered on 13th August 2004 for Kshs.2,000,000/=, and that K-Unity's alleged charge does not appear on the Green Card. The Respondent further argues that the Appellant failed to produce evidence of default on any K-Unity loan, and that the K-Unity entity is different from the entity named in the charge on the Green Card. 32.The strain between these positions is significant. On the one hand, the absence of a registered charge in favour of K-Unity on the Green Card is a notable lacuna in the Appellant's case. Under the Land Registration Act, a charge over land takes effect upon registration, and an unregistered charge does not bind third parties. The Respondent is correct that a mere assertion that the title is held by K-Unity is insufficient without evidence of a duly registered charge. I find persuasive the case of Githuka v Njau [2025] KEELC 8130 cited by the Respondent that the Green Card is the authoritative record of the history of the land and registered encumbrances thereon. 33.On the other hand, the physical possession of a title deed by a financier as confirmed by K-Unity's letter is itself a form of lien recognised in practice, even if not formally registered as a charge. The Appellant placed this evidence before the trial Magistrate. I find that the Respondent's argument that the Green Card shows only a charge of Kshs. 2,000,000/= registered twenty years earlier has considerable force. The Appellant produced no evidence that this older charge remained subsisting, nor did it explain the discrepancy between the K-Unity documents and the Green Card entries. In the absence of a formally registered charge in favour of K-Unity on the property's register, I am not satisfied that the Appellant established a legally enforceable encumbrance sufficient to take away the Respondent's right to execute. 34.The trial court addressed the contents of the Green card as hereunder‘The decree holder has produced a green card in respect to the parcel sought to be attached and the same was certified a true copy of the original on 4.5.2019. It does not show any charge registered on the title in favour of K-Unity Sacco’ 35.The trial Court correctly questioned why the charge created for the sum advanced to the Appellant by K-Unity Sacco was not registered against the title document. It was incumbent upon the Appellant to present a copy of the charge document to reflect the alleged registration of the charge. The Appellant did not dispense with that requirement at the hearing of the Notice to Show Cause and in this Appeal. 36.The Appellant submits and this Court finds that this is the most meritorious ground of the appeal. The learned trial Magistrate was obliged to consider the affidavit evidence placed before it before arriving at a determination on whether execution should proceed. The affidavit of David Irungu Kiiru raised specific matters, including the existence of a K-Unity loan facility, the physical holding of the title deed, the Appellant's pending receivership proceedings, and a prayer for suspension of execution. 37.However, from the record before me, including the Notice to Show Cause, the Affidavit in Response, the Affidavit in Reply, and the surrounding circumstances, I am satisfied that the trial court was possessed of the Appellant's affidavit and was required to engage with it substantively before sanctioning execution. The trial court in the ruling dated 18th July,2019 expressly made reference to the affidavits filed by the parties. I therefore find that the court properly considered the affidavit evidence in the determination of the Notice to Show Cause. 38.The Appellant relies on Order 50 Rule 6 of the Civil Procedure Rules and Article 159(2)(d) of the Constitution to argue that the trial court should have granted a reasonable extension of time within which to satisfy the decree. I note that as at the date of the ruling on 18th July 2019 the decree has been in existence since November 2016, a period of over two years and eight months. The Appellant had, since at least March 2013, been pleading financial difficulty and requesting indulgence, yet no payment, no matter how modest, was made towards satisfaction of the decretal sum. The evidence on record demonstrates a persistent pattern of delay and non-compliance stretching over a period of nearly a decade from the date of supply of goods in 2012 and 2013 39.In the premises, I find that the appeal as a whole is not well founded. The Respondent obtained its judgment through due process following a fully contested trial in 2016. The Appellant has, for a period in excess of nine years from the date of supply of goods, availed itself of every procedural avenue to delay satisfaction of a legitimate commercial debt. The pursuit of this appeal, filed in 2024 against a ruling delivered in 2019, further compounds the delay. The interests of justice and the principle that a successful litigant is entitled to the fruits of its judgment weigh heavily against the Appellant. 40.Having considered the totality of the material placed before this court, I am not convinced that any of the cited grounds for this appeal has been satisfactorily proved. I find no fault in the Ruling of the learned Senior Principal Magistrate delivered on 18. 7.2019. 41.The upshot is that the appeal lacks merit. It is dismissed with costs to the Respondent. DATED, SIGNED AND DELIVERED VIRTUALLY THIS 19TH DAY OF JUNE 2026 THROUGH THE TEAMS MICROSOFT PLATFORM.KENNEDY KANDETJUDGEIN THE PRESENCE OF:Stower H/b For Mbigi for the AppellantNo Appearance for the RespondentCourt Assistant: Jael Nosim