https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5192

**REPUBLIC OF KENYA** **IN THE ENVIRONMENT AND LAND COURT AT NAIROBI** **ELC OS NO. E022 OF 2022** **DENNIS NJAU KIMANI ………………………………..…………… 1ST PLAINTIFF** **HIMAX LIMITED …………………………………….……….…….. 2ND PLAINTIFF** **VERSUS** **JARO MOHAMMED alias JARO MOHAMMED ABDI ……... 1ST DEFENDANT** **OCEANIC LIMITED ……………………………………. …….. 2ND DEFENDANT** **ALI IBRAHIM …………………………………………….…….. 3RD DEFENDANT** **JUDGMENT** 1. The plaintiffs approached the court through an amended plaint dated 6.10.2023. The prayers sought are: 2. **An injunction to issue against the 1st and 2nd defendants or their agents or proxies from transferring the land identified as LR 12377 now gazetted as L.R. NAIROBI BLOCK 13/473 originally No.3734/9/5/22, hereinafter the suit property, in the name of the 1st defendant, his servants, agents or proxies.** 3. **The Land Registrar, Ardhi House, be ordered to transfer the property pro rata to each individual contribution.** 4. **In the alternative and without prejudice, the court orders the defendants to refund Kshs. 39,925,869/- paid to the purchase of the property plus damages and interest.** 5. **Take cancellation of title in the name of the Defendants and the plaintiffs’ interests into account.** 6. **In the alternative, pay the court to order the auction of the house on the suit property and the plaintiff their share of investment from the proceeds of the sale.** 7. **The plaintiffs be paid rental income plus interest –pro rata from 30 June 2018 at the rate of KHz. 250,000/- to the date of conclusion of this suit.** 8. The plaintiffs contend that on or about 2017, the plaintiff and the 1st defendant being known to each other for a long time agreed to do business together whereby, the 1st defendant came up with a proposal of buying property from depressed markets among other businesses, to which it was agreed that each party could make a contribution towards the businesses out of which they still share its proceeds according to the individual contribution. 9. The plaintiffs avers that in December, 2017, the 1st defendant developed the Suit property belonging to the 2nd defendant, which had been charged to Standard Bank but also had been put up for sale by way of Private Treaty. 1. Following negotiations done on their behalf by the 1st defendant, the plaintiffs aver that the purchase price for the suit property was agreed at KShs.50 million. 2. The plaintiff avers that on 5.12.2017, the 1st plaintiff met with the 1st defendant at Stedmark Garden Hotel with a Lawyer known as Linus Thuranira, who had already prepared a sale agreement between the 1st plaintiff and the 2nd defendant, to which the 1st plaintiff signed in the presence of the said lawyer. 3. The plaintiffs aver that as a term of the sale agreement, the purchase money was to be channelled to Standard Chartered Bank Ltd through their lawyers, who then undertook to avail the original title and discharge the suit property upon receipt of payments and forward the completion documents to the purchaser’s Advocates. 4. The plaintiffs aver that in early April, 2018, the 1st defendant told the 1st plaintiff that he had managed to secure the suit property through payment of some deposit and that a balance outstanding of Kshs.40 million was required by the seller. 5. The 1st plaintiff avers that he then approached his Co-Director of the 2nd plaintiff, who agreed to advance to him and the 1st defendant Kshs. 39,925,869 on condition that a Board resolution be made to support the transaction. 6. The plaintiffs aver that on 5.4.2018, the 1st plaintiff, in the company of the 1st defendant, visited Co-operative Bank of Kenya Lavington Branch and transferred Kshs.39,925,869 from the 2nd plaintiff’s account in favour of the Bankers' Lawyers Account, as his contribution towards the purchase of the price. 7. The plaintiffs aver that after payment of the outstanding purchase price for the suit property, the first defendant became evasive, declined to discuss the subject matter and refused to pick any of the first plaintiff’s calls, only for the latter to learn later that the first defendant had fraudulently taken possession of the subject property. Further, the plaintiffs established that the first defendant had also put in a tenant therein. Equally the first defendant has since the purchase solely and exclusively been enjoying rental income, while keeping the plaintiffs in total darkness about the purchased house. 8. The 1st plaintiff avers that in July 2019, he visited the subject property in company of a value to value the house only for the first defendant to instruct the guard to chase him away. 9. The plaintiffs aver that the defendant's actions amount to defrauding them of the subject property and the investments made thereto to acquire the same. The particulars include; presenting to the 1st plaintiff a business investment and to defraud them: using unorthodox means to correct the title documents, collecting completion documents without disclosing or informing them, colluding with them to defraud them of their money: keeping the 1st plaintiff in the dark about the whole transaction given, lastly entering into a sale agreement dated 5.12.2017 between the 1st and 2nd defendants without informing the plaintiff as a way of defrauding them. 10. The 1st defendant opposed the suit through a statement of defense dated 13.1.2023. He vehemently denies the contents of paragraphs number 1.10,73,4,5,6,7,8,10,11,12,13,14,15,16 of the amended plaint. The 1st defendant avers that the 1st plaintiff was to enter into business with a third party and not with himself. 11. The 1st defendant avers that he is not the owner of the suit property, and instead states that the 1st plaintiff and he only executed the sale agreement as agents of the 3rd defendant, who was the actual purchaser of the suit property. 12. The 1st defendant avers that his involvement in finding and negotiating for the purchase of the suit property was purely in his capacity as an agent rather than a principal known third party. 13. The 1st defendant denies the alleged meeting in paragraphs 7 and 8 of the amended plaint, whose contents he describes as a figment of the 1st plaintiff’s imagination. The 1st defendant denies the contents of paragraph 15 of the amended plaint; otherwise, he has no capacity to deny the 1st plaintiff and the alleged valuation officer access to, as he was neither the registered owner nor the possessor. 14. The 2nd defendant opposes the suit through a statement of defense dated. 28.11.2022. The 1st defendant avers that at no time did the 1st defendant intimate to him that he was to negotiate the sale of the suit property on behalf of the 1st plaintiff. 1. The 2nd defendant admits that indeed a sale agreement dated 5.12.2017 was drawn by the purchaser’s Advocates after accepting the 1st defendant’s offer to purchase the suit property. 2. The 2nd defendant denies the contents of paragraph 10 of the amended plaint that the 1st defendant was only acting in trust on behalf of the 1st plaintiff. 3. The 2nd defendant denies knowledge of the contents of paragraphs 3, 4, 5, 6, 11, 12, 13, and 15 of the amended plaint. Instead he avers that the sale of the suit property to the 1st defendant was done professionally and legitimately vide a sale agreement dated 5.12.2017, for a valuable consideration of Ksh.50 million paid to his bankers and was therefore not party to any alleged sale agreement between the 1st plaintiff and the 1st defendant. 4. The 2nd defendant denies that he was ever involved in, or a party to or aware of any fraudulent activities as alleged by the plaintiffs in paragraph 16 of the amended plaint. 5. The 3rd defendant opposed the suit through an amended statement of defense and counterclaim dated 30.10.2023. He denies knowledge of any relationship that the plaintiffs had with the 1st defendant, who at all material times was his known and disclosed agent. 6. The 3rd defendant avers that, based on a Principal-agent relationship, the 1st defendant executed the sale agreement dated 5.12.2017 and undertook the transaction in respect of the suit property on his behalf. 7. The 3rd defendant denies the contents of paragraphs 3 and 4 of the amended plaint and reiterates that all actions undertaken by the 1st defendant were under his authority and were for his own benefit and not any other party, including the 1st defendant. 8. The 3rd defendant avers that the 1st plaintiff was his business partner in the 2nd plaintiff’s company, whom they incorporated for purposes of acquiring contracts from Isiolo County Government. 9. The 3rd defendant avers that to avoid conflict of interest, the 3rd defendant was not a disclosed Director and shareholder, but only a signatory to the Bank Account held in the name of the 2nd plaintiff at Co-operative Bank of Kenya to enable him to have sight of the 1st Defendant’s finances. 10. The 3rd defendant avers that the County Government of Isiolo paid fees for work done through the 2nd plaintiff's account after he became a signatory to the said account. 11. The 3rd defendant avers that the said payments by the County Government of Isiolo were in two instalments of Kshs.13,786,441.20 and 26,140,428.20 totaling Kshs.39,926,869.40 which sum was fully utilized to clear the balance of the purchase price. On 5.4.2023. 12. The 3rd defendant avers that there was also sharing of other amounts paid to the said account by the County Government of Isiolo between the 1st plaintiff and himself. 13. The 3rd defendant admits that it was the 1st defendant who identified the suit property and undertook all the negotiations towards its purchase; otherwise, to the contrary, he denies the contents of paragraphs 5, 6, 7, 8, 9, 10, 11 and 13 of the amended plaint. 14. The 3rd defendant avers that the lawyer who handled all the transactions was at all material times his lawyer, who acted d on his behalf in all the transactions relating to the suit property, through his law firm known as Bingenya & Thuranira Advocates. 15. The 3rd defendant avers that the transfer of Kshs.39, 925,869 to clear the purchase price occurred following discussions between him and the 1st plaintiff. The 3rd defendant avers that the plaintiffs knew him as the actual purchaser and eventual beneficial owner of the property, where after he eventually took possession of the same, and has since remained in possession, to an extent of allowing the 1st defendant to reside on the suit property. The 3rd defendant terms the plaintiffs’ suit as amouting to unjustly enrichment. 16. By way of a counterclaim, the 3rd defendant, as the plaintiff reiterates that he is the actual beneficial owner of LR No.3734/937, initially NO.3724/915/22, which does not belong to the defendants in the counterclaim, a fact that the 1st plaintiff is aware of. 17. The plaintiff in the counterclaim avers that he solely bought the suit property through a sale agreement dated 5.12.2017, that was executed on his behalf by the 1st defendant in the primary suit, as his agent, and to which he is exclusively entitled to all the rights and interests thereto on use, possession and ownership. 18. The 3rd defendant, as the plaintiff in the counterclaim, prays for orders that: 19. A declaration be made that the plaintiff in the counterclaim, Ali Ibrahim, is the sole and exclusive owner of Maisonette No. 1 erected on LR No. 3734/937, Lavington Nairobi, (now gazetted by the Ministry of Lands as LR No Nairobi Block 13/473), to the exclusion of all other parties in the suit, in particular the 1st, 2nd and 3rd defendants in the counterclaim; 20. An order directing that all encumbrances on the title as are adverse to the proprietorship of the plaintiff in the counterclaim to Maisonette No. 1 erected on LR No. 3734/937 (now Ministry of Lands as LR No Nairobi Block 13/473), be expunged from the register; and 21. Costs of the original suit and the counterclaim be awarded as against the 1st and 2nd defendants in the counterclaim. 22. The plaintiff filed replies to the defendant’s statements and defense with the 3rd defendant’s defense and counterclaim dated 6.10.2023 and 10th February 2025. 23. With respect to the 3rd defendant, the 1st plaintiff denies that he had met or known him .The 1st plaintiff pleads that he only met the 3rd defendant at the time of making him a signatory to the account of the 2nd plaintiff to safeguard the interest of the 1st defendant. 24. The 1st plaintiff avers that he is the one who had successfully applied for and won tenders No.IC9/018/2017/2018 and IC0/019/2017/2018 in Isiolo County Government. 25. The plaintiffs reiterate that they are the owners of the suit property that the 3rd defendant is trying to defraud them of. 26. The plaintiffs aver that it is the 1st defendant who is in actual possession of the suit property against the plaintiff’s rights simply because he is a son of a senior politician. 27. The plaintiffs aver that the introduction of the 3rd defendant in the suit is an aforethought scheme meant to cook up facts with the intention of stealing the plaintiffs’ investment; otherwise, he denies the contents of the counterclaim. 28. At the hearing. Dennis Kimani Njau testified as PW1. He relied on a witness statement dated 14.6.2022 as his evidence in chief. 29. PW1 told the court that he is the 1st plaintiff and the sole Director of the 2nd plaintiff. PW1 said that in 2017, the 1st defendant, whom he has known for a long time, met, discussed and agreed to undertake some businesses among them, buying properties from depressed markets among other businesses. To this end, PW1 said that they agreed each party would make a contribution towards buying the property and thereafter share profits in accordance with One’s initial contribution. 1. PW1 said that in December 2017, the 1st defendant informed him that he had identified the suit property in which they could invest. 2. PW1 told the court that they established that the suit property belonged to the 2nd defendant, which had a lease, though charged with Standard Chartered Bank Ltd. 3. PW1 said that since he was very busy that month, the 1st plaintiff undertook on his behalf the initial negotiation with the owner, where they agreed on a purchase price of Kshs. 50,000,000/- which he had no problem with. 4. PW1 said that the 1st defendant organized for a meeting with the seller, the 2nd defendant, whom they met at Stedmark Garden Hotel in the presence of a Lawyer by the name Linus Thuranira.He said that the lawyer came with a prepared sale agreement by the firm of Gachie Mwanza & Co. Advocates, which they all signed in the presence of the said lawyer. 5. PW1 told the court that one of the terms of the sale agreement was that the consideration was to be paid to the charge’s bank through its Advocate M/S Harrison & Matthew Lawyers account, who, upon payment, would also deliver to the purchasers the original title deed, discharge of charge and all the completion documents. 6. PW1 told the court that in early April 2018, the 1st defendant told him that he had managed to pay a deposit of Kshs.10 million and a balance of Kshs.40 million was required. 7. PW1 said that he then approached his Co-Director to the 2nd defendant, one Rebecca Wanjiru, who agreed to advance a balance of Kshs.39,928,869 from the 2nd plaintiff's account, on condition that she would be compensated by way of profit, where after, they executed a board resolution to transfer the amount. 8. PW1 said that on 5.4.2018, in the company of the 1st defendant and the 3rd defendant, as signatories to the account visited Co-operative Bank of Kenya Lavington Mall Branch where they transferred for the 2nd plaintiff’s account NO.48650403100 Kshs. 39,925,869 to Hamilton & Mathew Layers account as part of his contribution to purchase the suit property. 9. PW1 said that the bank also demanded a copy of the sale agreement to aid in transferring the monies, whereby he gave them the sale agreement dated 5.12.2017 as evidence. 10. PW1 said that after he contributed to the purchase of the suit property, the 1st defendant became evasive and declined to hold any discussions regarding the house, only for him to establish that the 1st defendant had allegedly taken possession of the house and rented it to a tenant. 11. PW1 told the court that, he then decided to value the house. He said that when on 9.9.2019 he paid a visit together with a valuation officer, he was unable to access if for the 1st defendant had instructed the watchmen to chase him away. PW1 relied on a copy of the company resolution as P. exhibit NO.1-4, CR 12 as p. exhibit No.5(a) and (b) copy of the search as P. exhibit NO.6, certificate of incorporation as P. Exhibit No.7). Sale agreement dated 5.12.2017 as P. exhibit No. (8) Letters, dated 22.2.2018 as P. Exhibit No. (9), RTGS application form as P. exhibit no. (1) Bank statement as part No.11 (a) – (c), slip affidavit latest 15.9.2022 as P. exhibit no. (12). Letters from Macharia Munene as Exhibit No. (13), letters from Hamilton & Matthews Advocates as Exhibit No. (a) and (b), sale agreement dated 5.8.2017 as Exhibit No.15, Telecom as Exhibit No.16, agreements dated 21.5.2018 as Exhibit No.(17) EACL letters as Exhibit No.17, and consent dated 8.6.2018 as Exhibit No.19. 12. PW1 said that the parties had sent a letter to the sellers' lawyers seeking to know the status of the suit property. PW1 said that all instructions to Transact on his behalf which he gave to the 1st defendant were verbal in nature. 1. PW1 said that the 2nd defendant was privy to the joint business proposal the 1st plaintiff had with the 1st defendant. 2. PW1 denied that the 1st defendant disclosed or acted as an agent of someone else during the transaction. PW1 could not tell how the completion documents came to the custody of the 1st defendant’s lawyers. PW1 admitted that he never paid any legal fees to the Advocates who prepared the sale agreements. 3. PW1 said that the 1st defendant was a trusted partner at the time of the transaction. PW1 admitted that the seller’s lawyers, namely Hamilton & Matthews Advocates, sent some of the completion documents to him. 4. PW1 said that it is possible that the completion documents were forwarded to MS Linus Thuranira Advocate. 5. PW1 said that he came to know about the 3rd defendant through the 1st defendant when he became an additional board signatory to the 2nd plaintiff’s bank accounts. 6. PW1 said that the source of Kshs.39, 925,386/- was a payment for public works he had done for Isiolo County Government. 7. PW1 admitted that in the 2nd witness statement he had mentioned the source of the funds as his mother’s, who was also a shareholder in the 2nd plaintiff’s company. 8. PW1 admitted that the EACC had also filed a case against the 3rd defendant, which was eventually settled, after which the 2nd plaintiff’s bank accounts were unfrozen. 9. Jaro Mohammed, the 1st defendant, testified as DW1. He relied on a witness statement dated 22.4.2024 as his evidence in chief. DW1 told the court that as indicated in his witness statement, he acted in the transaction only as an agent of the 3rd defendant but not as the owner or purchaser of the suit land. 10. DW1 told the court that the 3rd defendant had a lawyer, DW3, in this matter, who handled the documentation for the transaction. DW1 said that he was the one who initiated the process of buying up the land with the 2nd defendant and not the 1st plaintiff. DW1 said that he is also the one who signed the documents of sale on behalf of the 3rd defendant. 11. DW1 said that his dealings with the 1st plaintiff had nothing to do with the 2nd defendant; otherwise, he was the one who paid the initial deposit for the land on behalf of the 3rd defendant. DW1 made an admission that his father was the former Governor of the Isiolo County Government, where he had instructed the 1st plaintiff through the 2nd plaintiff to obtain tenders for public works. 12. DW1 denied knowledge that his father, as the then governor, had employed DW3 as a legal advisor at the time of the transactions. 13. DW1 denied that he jointly bought the suit property with the 1st plaintiff through funds supplied by the 2nd plaintiff’s company. 14. DW1 denied that he was the one occupying the suit property. DW1 denied that the 3rd defendant was his agent in all his dealings with the Isiolo County Government. 15. Joseph Karobo testified as DW2. He relied on a witness statement dated 14.10.2024 as his evidence in chief. DW2 admitted signing the sale agreement as a Director of the 2nd defendant, which sold the suit property to the 1st defendant as a representative of the 3rd defendant in the transaction in the sale agreement dated 5.12.2017.DW1 told the court that after the successful completion of the transactions, his Company handed over vacant possession of the suit property to the 3rd defendant.DW2 confirmed receiving part of the purchase price from the 1stdefendant and the 2nd plaintiff. 1. DW2 confirmed executing two sale agreements between his company and the 1st plaintiff as well as the other one with the 1st defendant. 2. Ali Ibrahim testified as DW3. He relied on a witness statement dated 22.4.2024 as his evidence in chief. To buttress his evidence, DW3 relied on a court order dated 20.50.2022 as D. exhibit No.(1) letters dated 20.5.2022, 12.5.2022, 24.3.2022, 18.1.2021, 10.1.2022, 3rd January, 2022, 9.2.2024,20.5.2022, 12.5.2022, 4.3.2022 and 30.7.2017 as P. exhibit NO. 2(a) – (k).DW3 also relied on a SWIFT confirmation note dated 14.12.2021 as D. exhibit 2(1) and (3) respectively. 3. DW1 confirmed that the 1st defendant undertook the transaction as his agent with full authority to negotiate, sign the sale agreement and effect the transfer under his name. DW1 said that he took over vacant possession and rented the premises to a tenant after purchasing the land. 4. In cross-examination, DW3 said that the said sale agreement was made simply because the 1st defendant was a signatory to the account where the money was to be transferred to the seller; otherwise, the 1st defendant was a mere agent, him being the principal and the beneficial owner of the suit property. 1. DW3 said that he had to look for the 1st defendant since his company lacked requisite capacity to obtain or win tenders for public works with Isiolo County Government. 2. DW3 said that the Kshs.10 million paid for the deposit of the house by the 1st defendant had came from him, though there was no written principal and agency agreement between him and the 1st defendant at the time. 3. DW3 also confirmed meeting the 1st plaintiff with an intention of being business partners. DW3 denied incorporating the 2nd plaintiff with the 1st plaintiff as business partners. He however admitted that he was made a signatory to the accounts of the 2nd plaintiff to take care of the interests of the 1st defendant in the transaction.DW3 seemed to disown the contents of paragraph 20 of his amended statement of defense. 4. DW3 denied that he had conspired with the 1st and 2nd plaintiff’s both of their monies used to buy the suit property and the house itself.DW3 confirmed that on 11.7.2018 he was given Kshs.18 million by the 2nd plaintiff, which he later on refunded to the EACC in settlement of the earlier suit against him. 5. Linus Thuranira Gichunge, advocate testified as DW 4. He relied on a witness statement dated 22.4.2024 as is defense in chief.DW4 told the court that he was the one, who drafted and witnessed the signing of the two sale agreements dated 5.12.2018, one of which the 1st and 3rd defendants were to use in order to transfer monies held in the 2nd plaintiff’s account. 6. He said that the account signatories were the 1st plaintiff and the 3rd defendant, gong by the certification of the same by the bank on 5.4.2018. 7. DW4 clarified that the 1st defendant at all material times to the sale agreement was an authorized agent of the 3rd defendant. 8. DW4 said that in order to effect monies transfer from the 2nd plaintiff’s account to clear the balance of the purchase price of the suit land he prepared the two sale agreements. 9. DW4 confirmed that the sale agreements were **silent** on whether the 1st defendant was acting as an agent of the 3rd defendant in the transaction. 10. DW4 denied that there was no intended fraud in preparing the two sale agreements; otherwise, he did so under the instructions of the 3rd defendant as the instructing client. DW4 denied that the sole intentions of preparing a 2nd sale agreement the same day was to defraud the 1st plaintiff of his property. 11. Following closure of the defense case, parties were directed to file and exchange written submissions. Only the 1st and 2nd defendants complied with the timelines set by the court. 12. The 1st defendant relied on written submissions dated 10.7.2024 isolating five issues for determination. It is submitted that other than merely asserting entitlement of the suit property, the plaintiffs have failed to discharge the burden placed on them to prove the salient facts in support of their claim under Section 107 of the Evidence Act. Reliance is placed **on David Bagine – vs- Martin Bundi (1997) eKLR.** 13. The 1st defendant submits that the plaintiff failed to call the Co-Directors as witnesses to confirm that the alleged Kshs.39million was lent to the 1st defendant. 14. The 1st defendant submits that though there was initially an intention to be business partners with the 1st plaintiff, which, as of 5.12.2024 had not materialized, when he signed the sale agreement, it only materialized sometimes in March 2018, after which the 3rd defendant was made a signatory of the 2nd plaintiff’s bank account. He submits that consequently he disengaged himself and left the two parties to deal. 15. The 1st defendant submits that in the course of the suit, he has expressly denied he any claim to ownership of the suit property, otherwise he was only an agent of the 1st defendant hence the claim against him lacks factual and legal foundation. 16. The 1st defendant submits that he had only lent the 3rd defendant his money since the business venture with the County Government of Isiolo had not materialized, which from the 2nd plaintiff’s bank account proves the assertion that the 1st plaintiff was paid a commission on 12.7.2018 of Kshs.15,200,000/-but unfortunately he now wants and has come to court to assert property rights. 1. The 1st defendant submits that the 1st plaintiff though asserting he was a bonafide purchaser of the land, he has tendered no evidence to show that he ever paid legal fees for the alleged transaction or perhaps availed any supporting correspondence relating to the transaction with DW4. 2. The first defendant submits that PW1 was unable to substantiate or explain the source of funds initially indicated to have been a purported a loan from his mother for purchase of the suit property. On the contrary, the bank statement shows the said source was from the County Government of Isiolo, on top of the explaining the fate of the completion documents as the alleged purchaser of the land. 3. The 1st defendant submits that it is also uncontroverted fact that 1st defendant was not a party to ACECA ELC No.18 of 2020 that had been brought against the plaintiff’s and the 3rd defendant leading to a consent settlement in which EACC had sought for preservation and the forfeiture of the contract sums and the suit property. 4. The 1st defendant submits that the plaintiffs only commenced laying claim to the suit property after the EACC came calling in 2020 long after the plaintiffs and the 3rd defendant had completed their business venture in 2018. 5. The 1st defendant submits that the facts borne out in the pleadings and the parties testimonies clearly show that he paid the 10% deposit for the suit property as an agent of the 3rd defendant, going by the corroborative evidence of DW3 and DW4. Therefore, the 1st defendant submits that a suit cannot lie against an agent of a disclosed principal. Reliance is placed on **County Council of Nairobi –vs- Wilfred Kamau Githua t/a Githua Associates & Another (2016) eKLR.** 6. The 1st defendant submits that there is also evidence that the agency relationship was oral based borne out of a longstanding mutual business trust, which the plaintiffs have not produced contrary evidence to disapprove. 7. *The first defendant submits that under Section 97 of the Evidence Act extrinsic evidence may be used to prove the existence of an oral agreement showing that the mother’s contract was not meant to take effect until a specific condition arrived.* 8. In this case, it is submitted that the specific condition took place as soon as a business venture between the 3rd defendant and 2nd plaintiff materialized, where after the 1st defendant exited the scene. 9. The 1st defendant submits that the 1st plaintiff’s own handwritten note at page 25 of the trial bundle dated 22.2.2018 to the back was a clear evidence introducing the 3rd defendant to the Board as a signatory to the 2nd plaintiff’s bank accounts. 10. The 1st defendant submits that that the belabored attempt to link him with the suit property for purposes of advancing a cause that the suit property constitutes proceeds of crime cannot pass legal muster. It is submitted that there is no proof that the 1st defendant has been associated with any economic crime as regards the acquisition of the suit property; he was not a party to the ACECA ELC No.18 of 2022, which was settled as per the consent in the plaintiffs’ bundle of documents. Reliance is placed on **EACC and Another – vs- Aboo Petition E044 of 2024 (2026) KESC 44 (KLR).** 11. The 1st defendant submits that the ACECA ELC No.18 of 2020 were not forfeiture proceedings, showing the commission of a crime under his part. Further, the 1st defendant submits that there were no criminal proceedings filed against him, to link him and the suit property because of commission of any crime. 12. The 1st defendant submits that the plaintiffs do not deserve the reliefs sought for they have failed to present prima facie evidence, warranting the shifting of the burden of proof to him. Reliance is placed **on Njoroge – vs Gabriel & Another (2025) KENC 404(KLR).** 13. The 2nd defendant relies on written submissions dated 10.7.2016 isolating one issue for determination. The 2nd defendant submits that the plaintiffs have failed to prove their case against it on the alleged conspiracy to defraud him of the land, making the allegation brought against it-unsubstantiated ted. Reliance is placed on **Moi -vs – Murithi & Another (2014) KECA 642(KLR) and Laisu & 2 others – vs- Sharif** **& Another (2024) KEHC 15512(KLR).** 14. The 2nd defendant submits that it was a mere vendor of the suit property and at no point did it meet the plaintiffs as confirmed by PW1, DW1 (2) and (3), otherwise only acted as per the instructions given to it by the 1st defendant. The 2nd defendant submits that no evidence was tendered to show that it had prior knowledge of the arrangements between the plaintiff’s and the 1t and 3rd defendants. 15. The 2nd defendant submits that the plaintiffs’ alleged fraudulent representation must collapse for PW1 admitted that he never me or spoke to the representative of the 2nd defendant in person. 16. The 2nd defendant submits that the Lawyers who acted in the transaction have confirmed that plaintiffs were party to the transactions ,whereat the 1st Defendant was and remained as the 3rd defendant’s agent. 1. The 2nd defendant submits that grant of the reliefs sought cannot be founded on mere suspicion, disappointment, fraud or on private arrangement on the plaintiffs ‘believe that the other defendants ought to have protected the plaintiffs’ alleged interests in the suit property. 2. The second defendant submits that the alleged fraud or any of its ingredients namely common intention, making of a minor or collusive arrangement have not been proved. 3. The 3rd defendant relies on witness submissions dated 9.7.2026.It is submitted that the plaintiff’s suit suffers defects of law given it is a claim for an interest in land, where there is no contract that satisfies the requirements of Section 3(3) of the Law of Contracts Act. 4. The 3rd defendant submits that a claim based on fraud, which is a common tort has to be filed within three years after the cause of action accrues. 5. In this suit, the cause of action as pleaded occurred on 15.5.2018 when the lawyers for the 2nd defendant and those of the 1st defendant confirmed receipt of the discharge of charge and the release of the original title to the land, meaning that the suit was filed over 4 years since the accrual of the cause of action. 6. The 3rd defendant submits that the plaintiffs could have discovered the fraud with exercise of due diligence on time as held in **Margaret Wairimu Magaya – vs- Karura Investments Ltd & Others (2019) KECA 653(KLR).**It is submitted that the plaintiffs were aware of the alleged fraud in July, 2019 when they visited the suit property to do a valuation and fund the 1st defendant being in occupation as regards two sale agreements. 7. The 3rd defendant submits that whereas upwards the court is asked to take regard of all the evidence, the exemption in Section 97 and 98 of the Evidence Act with regard to oral and circumstantial evidence may be called to address evidence, which can be used to vitiate written agreement. Reliance is placed in **Kiplagat Kotut – versus Rose Jebor Kipngok (2019) KEELC (KLR).** 8. In this case, the 3rd defendant submits that the initial sale agreement which he executed was valid, otherwise, the other one was solely prepared for purposes of transferring funds from the 2nd plaintiff’s bank account to the vendor’s bank accounts. 9. The 3rd defendant submits that unlike his sale agreement, the other one lacks completion documents, and supporting grounds going by the evidence of the Advocate who witnessed the sale and completion of transaction to whom he paid legal fees for the transaction including, transfer fee, registration fees and stamp duty. 10. The 3rd defendant submits that if indeed DW4 had been working or acting on behalf of the plaintiff’s all what they required was to take out an originating summons against the Advocate for not availing the completion documents. The 3rd defendant submits that PW1 appears to have had no knowledge of the preparation of the sale agreements. 11. The 3rd defendant submits that there is evidence of principal and agent relationship, the 3rd defendant though having no company to transact with the County Government of Isiolo sought help ,to which the 1st defendant who introduced him to the plaintiffs, who upon payment by the County Government of Isiolo paid the 1st plaintiff his commission , on 12.7. 2018, and later on exited as the signatory as per a board resolution of 30 July 2018. 12. The third Defendant submits that his sale agreement complies with Section 3(3) of the Law of Contract Act and is therefore capable of enforcement. 13. The 3rd defendant submits that the source of funds and the payment of the balance of the purchase price is confirmed by Letters dated 21.8.2022 from the seller’s lawyers and is admitted in the PW1 witness statement, and therefore through the doctrine of estoppel, the plaintiffs are barred from denying obvious facts. 14. The 3rd defendant submits that the failure to produce a resolution referred to in the witness statement and to call the co-director of the 2nd plaintiff was fatal as to the source of the funds if not from the county business. 15. The 3rd defendant’s submits that there alleged fraud against him was not specifically pleaded, particularized or proved by the plaintiffs as per paragraph 18 of the amended plaint. On the contrary, the 3rd defendant submits that from the evidence before court, the plaintiffs were aware of the business investment which involved all the parties, and that they knew of the documentation being prepared and held by DW4. The 3rd defendant submits that if there was an intention to defraud PW1 he could have sued him long time ago. 16. The 3rd defendant urges the court to find the suit against him as time-barred and lacking merits, and thereafter find his counter-claim merited. 17. The issues calling for courts determination are: 18. If the plaintiffs have proved that, they were in a business venture with the 1st defendant. 19. If the plaintiffs have proved that, they contributed towards the acquisition of the suit property. 20. If the plaintiffs have proved that the defendants used fraudulent means to acquire, transfer, register, and take possession of the suit property despite the plaintiffs’ contribution of its acquisition. 21. Whether the plaintiffs are entitled to the reliefs sought. 22. If the 1st defendant was an agent of 3rd defendant in acquiring the suit property. 23. If the 3rd defendant was the actual and beneficial owner of the suit property. 24. If the 3rd defendant is entitled to the prayers in the counter claim 25. What is the order as to costs? 26. A cause of action was defined in **D.T Dobie and company (Kenya Limited) vs Joseph Mbaria Muchina & Another (1980) eKLR** as an act on the part of the defendant that gives the plaintiff his cause of complaint. 27. The plaintiffs claim as per the amended plaint dated 6.10.2023 is that they were in a business transaction with the first defendant whom they sourced for and paid for the suit land with an intention of owning the same, as per the individual contribution made in the cause of its acquisition. It is averred that despite the foregoing arrangements, the 1st defendant to fraudulently undertake its transfer registration, possession and ownership, behind their back, with an intention of defrauding them of the investment in acquiring the same,incohorts with the other defendants. 28. The plaintiffs urge the court to intervene and stop the transfer of the suit property to the name of the 1st defendant, to hold that the transfer should be on pro rata basis depending on each of parties’ contribution. In the alternative the court is asked to order that defendants to refund the plaintiffs’ Ksh.39, 925,869 and to order the cancellation of title. Further and in the alternative, the plaintiffs’ ask that the suit property be auctioned and their share of investment there be recouped. Lastly, the plaintiffs ask for payment on prorate basis of the rental income by the 3rd defendant since June 2018. 29. The plaintiffs claim is founded on an alleged breach of contract. The elements to be proved before bringing a claim for breach of contract were discussed in **William Mutee Muthami vs Bank of Baroda (2014) eKLR.** 30. The court held thus: “In the law of contract the aggrieved party to an agreement must in addition prove that there was an offer, acceptance and consideration.” 1. Section 107 of Evidence Act provides that the burden lie on the party who desires a court to give judgment as to any legal right depending on the existence of fault, which they allege. The plaintiffs allege that there was both a business venture followed by a sale agreement which was used to buy the land but unfortunately the 1st, 2nd and 3rd entered into another sale agreement with an intention of defrauding them out of the transaction. To counter this the first defendant and the 3rd defendant insist that the 1st defendant was an agent and only signed the 1st agreement and also made payment of the deposit to the 2nd defendant in that capacity. In the premise, the defendants insist that this makes the 3rd defendant the sole bonafide, actual and beneficial owner of the suit land, who also cleared all the consideration, leading to issuance of completion documents to his lawyer DW4. 2. Illegal contracts or transactions cannot be enforced by a court of law as held in **David Sironga Oletukai vs Francis Arap Muge & Others (2014) eKLR**. 3. It is also the law that no court can used as an instrument to enforce or assist a man who has founded his cause of action on an immoral, or an illegal act as was held in **Holeman vs Johnson (1775-1802) ALLER 98** and in Fit-**TighteFA-Steners Limited vs Akiba Bank Limited (2026) KECA 139 KLR.** 4. In **Pride Inn Limited vs Thatchmaanz Limited (2026) KECA 135 (KLR),** the court said that an oral contract is enforceable if it contains all the elements of a valid contract namely offer, acceptance, consideration, capacity, and legality. 5. Existence of an oral contract can be proved often through receipts email, correspondences or witness testimony. Party autonomy and freedom to contract is the corner stone of the law of contract. Courts have a duty or obligation to respect agreed terms absent of fraud coercion or undue influence as held in **National Bank of Kenya Limited vs Pipeplastic Samkoit (K) Limited and Another (2002) (2EA503**). 6. The Freedom to contract is not absolute. In **Kenya Commercial Finance Company Limited vs Kipng’eno Arap Ngeny (2002) 1KLR**, the court confirmed that equitable jurisdiction allows intervention when contracts are harsh, unconscionable or oppressive. 7. A court of law cannot rewrite a contract unless they are void, illegal or unconscionable as held in **Kanwal Sargit Singh Dhiman vs Keshavji Givraji Shah (2025) KECA 1264.** 8. The plaintiffs ask the court to enforce the sale agreement, which they signed with the IST defendant and the seller of the suit property in the absence of the 3rd defendant. In **Boma vs Kabugua & Another Civil appeal E019 of 2022 (2026) KECA (50) KLR** the court cited with approval **Gharib Suleiman Gharib vs Abdullahiman Mohammed Agil CAK Civil Appel No. 112 of 199**8 that specific performance is based on a existence of a valid and enforceable contract. The court said that being an equitable relief, such a relief is more often than not granted where the party seeking it cannot obtain sufficient remedy of an award of damages, the finding being whether specific performance will do more perfect and complete justice than the award of damages. 9. In this suit, the plaintiffs allege that they offered consideration of the suit land in which the first defendant was a joint owner and not an agent of a 3rd defendant. As a general rule of a contract it only affects parties to it and cannot be enforced by or against a person who is not a party, even if the contract is made for his benefit. 10. In **Agricultural Finance Corporation vs Rengetia Limited (1985) eKLR,** the court said that the fact that a person who is a stranger to the consideration of a contract stands in such near relationship to the party upon whom the consideration proceeds that he may be considered a party to the consideration does not entitle him to sue upon the contract. 11. In **Samuel Kamau Macharia vs Kenya Commercial Bank (K) Ltd (2003) eKLR**, the court said that the idea of unjust enrichment or unjust benefit is intended to prevent a person from retaining money or some benefit from another which it is against conscience that he should keep it. 12. The question to be answered in this suit is whether there was a valid business venture in the 1st instance, what was its terms and conditions, whether the 1st Defendant was an agent of the 3rd Defendant and what was the intention of the parties, whether any of them has breached the said terms and lastly what are the rights of the parties. 13. Whether or not there was a binding contract between the parties and if so upon what terms depends on what they had agreed. In **RTS Flexible Systems Ltd vs Molkerei Alois Muller GmbH & Co. KG (UK) Production (2010) UKSC 14**, the court said that it depends not upon the subjective state of mind but upon a consideration of which was communicated between the parties by word or conduct and whether that leads objectively to a conclusion that they intended to create legal relations and agreed upon all the terms which they regarded or the law requires as essential for the formation of a legally binding relation. 14. The starting point is whether there was a principal/agency relationship between the 1st Defendant and the 3rd Defendant in the transaction to purchase the suit land.In **Lucy Nungari Ngigi & Others vs National Bank of Kenya Ltd (2025) eKLR**, the court cited with approval **Bowstead & Reynolds on Agency, 17th Edition (Sweet & Maxwell, 2001) page 1 -100** .,that is relationship between two persons, one whom expressly or impliedly consents that the other should act on his behalf, so as to affect his relation with third parties and the other of whom similarly consents so to act or so acts. 15. In **Garnak Grain Co. Inc vs Hmf.Faure & Fairclough Ltd 1967 (2ALLER 353,** the court said the relationship can only be established by consent of the principle and agent either given expressly or by implication of their word and conduct. 16. The doctrine of privy of contract, postulate that a contract cannot confer rights or impose obligations on any other person other than the parties to a contract. 17. In this suit, the plaintiffs take the view that in the initial sale agreement, the 3rd defendant was not disclosed as a principle. The defendants on their part take a contrary view. In City Council of **Nairobi, vs Wilfred Kamau Gitua T/a Githua & Associates & Another (2016) eKLR,** the court said that the principle of common law is that where the principle is disclosed, the agent is not to be sued. In **Cheshire and Fifoot, the Law of Contract, 5th edition (Batterworths), 1960, pages 386,** it is stated that no one can become an agent of another person except by will of that person, the will can be manifested in writing or orally or simply by placing another in a situation in which according to the ordinary rule of law, or ordinary usage of mankind the other is undertook to represent and act for the other person who has so placed him. 18. Looking at the pleadings, and testimony of both the plaintiff and the 1st, 2nd and 3rd defendants, their documents , words and conduct leafing to the signing the two sale agreements, the board resloutions,the allowing of the 3rd defendant to become a signatory to the 2nd plaintiff’s bank account, the 1st and 2nd plaintiffs dealing with the 1st defendant as an intermediary both in souring for the business with the Isiolo County, the 1st and 2nd plaintiffs introducing the 3rd defendant to their bank and allowing its company and accounts to be used to do business with the county and later tob be as a conduit for the monies out of the business venture, the court entertains no doubt in its mind that there was a meeting of minds between the parties herein as regards to what they were doing. The plaintiffs are estopped in law from denying the arrangements they had with the defendants. 19. Issue No. 1 is answered in the affirmative while the 2nd issue is answered in the negative. The 1st and 2nd plaintiffs were never contributors of the consideration towards the purchase of the suit property. There is no evidence that the plaintiffs the than allowing this accounts to be used as a conduit made any investment toward the supply of oxygen to the county, to be entitled exclusively to all the income generated not of business. 20. There is uncontroverted evidence by DW1 and three that the 1st plaintiff was only entitled to and was paid the agreed commission of Ksh. 18,200,000 out of the business income generated from the county public works. If the plaintiffs were the joint owners of the suit property with the 1st defendant to the exclusion of the 3rd defendant, the plaintiffs would have appended their names, details and signatures in the transfer and registration forms. There is no evidence that the plaintiffs other than the initial sale agreement signed, executed and participated in the preparation of the registration / transfer forms or made payment of statutory charges, fees and stamp duty for the processing of the registration transfer forms. 21. Evidence that the plaintiffs procured and paid for the services of the lawyers handling the completion documents is missing. There is no evidence of site visit to the locus in quo by the plaintiffs to ascertain what they were purchasing. Delay in following up the enforcement of the sale agreement until the claim based on fraud became time-barred is not explained. Specific performance is an equitable remedy. He who comes to equity must come with clean hands and make full disclosure.PW1 failed to call other witnesses to substantiate the contents of the plaint on key elements to the business venture and their contributions to acquire the Suitland. The evidence of the defendants therefore is more credible and reliable as opposed to that of the plaintiffs. The court in the circumstance finds no basis to hold that the plaintiffs and the 1st defendant were the sole actual purchasers and eventually beneficiaries of the suit property. 22. The doctrine and the crux of the agency law is that is that he who acts through another, acts in person. Agency – principle relationship as testified by the 3rd defendant is one based on trust. **See R.Iyere vs Bendel Feed and Flour Mill Limited (2008) 18 NWLR119 and in Industrial and Commercial Development Corporation (ICDC) Vs Pathieon Limited (2015) KECA 96(KLR).** 23. Contracts between parties can exist where no words have been used but where it can be inferred from the conduct of the parties that a contract has been concluded. The court finds that the 1st defendant had apparent as well as express authority from the 3rd defendant to handle the land transaction on his behalf. The 1st defendant acted within the scope of his agency authority thus binding the 3rd defendant as held in **Kamau vs Kasese (1990) eKLR and National Bank of Kenya Bank Limited vs Pipe Plastic Samoklit (K) Ltd & Another (2001) eKLR.** 24. Section 10 of the Partnership act Cap No. 16 of 2012 provides that every partner is an agent of the firm and other partners for the purpose of partnership business. Company directors are also considered as agents of the company when acting within their power as held in **Ferguson vs Wilson (1866) LR2Ch.App 77**. Agency/ principle relation may be terminated automatically once the assigned task or purpose is fulfilled or by a revocation as held in **Ravina Agencies Limited vs Coast Water Works Development Company Limited (2024) eKLR**. It can also be terminated through mutual agreement or by lapse of time as held in **Kenya Commercial Bank Limited vs James Osebe (1982) KLR 296 and in Erastus Maina Muraya vs Kiplege Zochin Khure (2016) eKLR**. 25. Fraud and misrepresentation must be specifically pleaded and proven. It cannot be inferred from the facts. The burden to prove fraud is above the standard in ordinary suit as was held in **Ardhi-Developers Limited vs West End Butchery Limited & Others (2015) KECA 816 (KLR)**, **Kuria Kiarie and Others vs Sammy Magera (2018) eKLR and in Davy vs Garrett (1978) 7 ChD473**. 26. Evidence tendered by the plaintiffs fall short of the threshold set in the cited case law. Other than PW1, no one else especially the directors and other signatories of the 2nd plaintiff were called to collaborate the evidence of PW1’s on the aspect of the breach of contractor fiduciary trust, collusion and intention to defraud the plaintiffs of the suit land or the alleged unjust enrichment. The court therefore finds the plaintiffs have failed to prove their claim on that account. 27. A counter claim stands or falls regardless of the outcome of the primary suit. The plaintiff in the counterclaim has testified that the 1st defendant in the main suit is the one who negotiated, signed and executed on his behalf the sale agreement and made all the payments hence is entitled to enforce it. 28. The law is that even where third parties are mentioned in a contract, they cannot enforce any of his terms as held in **Ineah Liluyani Njirah vs Aghakhan Health Services (2013) eKLR.**Exceptions to the doctrine of privy of contract may be where a contract between parties is accompanied like in this suit by a collateral contract between one of them and a third party relating to the same subject matter as held in **Savings and Loan (K) Limited vs Kanyenje Karangaita Gakombe & Another (2015) eKLR**. 29. The evidence by the plaintiff in the counterclaim shows the root of his title and the path which he followed unlike the defendants in the counterclaim to acquire both, registration, ownership and possession of the subject property. Where a title to land is under contest each of the parties to the dispute must trace the root of their title and claim without any break in the chain as held in **Munge Maina vs Nivam Enterprise (2015) KECA 693 (KLR).** 30. From the evidence availed before this court, which the maim plaintiffs have not challenged; I think the plaintiff in the counter claim has proven his claim to be entitled to the relieved sort. The primary plaintiffs’ suit is dismissed with costs, while judgment is entered in favour of the 3rd Defendant on the counterclaim and the reliefs sought therein are granted as follows: 31. A declaration that the plaintiff in the counterclaim, Ali Ibrahim, is the sole and exclusive owner of Maisonette No. 1 erected on LR No. 3734/937, Lavington Nairobi, (now gazetted by the Ministry of Lands as LR No Nairobi Block 13/473), to the exclusion of all other parties in the suit, in particular the 1st, 2nd and 3rd defendants in the counterclaim; 32. An order directing that all encumbrances on the title as are adverse to the proprietorship of the plaintiff in the counterclaim to Maisonette No. 1 erected on LR No. 3734/937 (now Ministry of Lands as LR No Nairobi Block 13/473), be expunged from the register 33. Costs of the original suit and the counterclaim is hereby awarded as against the 1st and 2nd defendants in the counterclaim. 34. Orders accordingly. . **DATED SIGNED AND DELIVERED AT NAIROBI THIS 29TH DAY OF JULY, 2026** **HON. JUSTICE C.K NZILI** **JUDGE** **In the presence of:** Court Assistant: Julius Plaintiffs 2nd Defendant Mbuvi for the Defendants