[2021] KECA 1058 (KLR)

IN THE COURT OF APPEAL

AT MOMBASA

(CORAM: OUKO (P), KOOME & GATEMBU JJ.A)

CIVIL APPEAL NUMBER 162 OF 2018

BETWEEN

MWANAISHA KIRIALE MOHAMED..........................1STAPPELLANT

MBARAK HAMISI MBARAK........................................2NDAPPELLANT

AND

ALFRED WAFUA OKUKU.............................................1STRESPONDENT

PETER THUO GATHURI...............................................2NDRESPONDENT

NELLY NGONYO KAMAU............................................3RDRESPONDENT

(Being an appeal from the Judgment of the Environment & Land Court at Mombasa (Omollo, J.) delivered on 25thSeptember, 2018

in

Mombasa ELC Civil Case No. 129 of 2010)

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

JUDGMENT OF THE COURT

1. Mwanaisha Kiriale Mohamed and her son Mbarak Hamisi Mbarak, the appellants, are aggrieved by the judgement of the Environment and Land Court (A. Omollo, J.) delivered at Mombasa on 25th September 2018 dismissing their suit that sought a declaration that the sale and transfer of properties known as Plot No. 6480, 6481, 6490 Section 1 Mainland North Mombasa (the properties) by Alfred Wafua Okuku, the 1st respondent to Peter Thuo Gathuri and Nelly Ngonyo Kamau, the 2nd and 3rd respondents, is null and void. They complain that the learned Judge misapprehended the evidence and that, as the 2nd and 3rd respondents were not innocent purchasers for value without notice of the appellants’ interest, the Judge erred in sustaining the transfer of the properties in their favour.

2. Based on the evidence presented before the trial court, the pertinent facts are that until 17th April 2008, the appellants were the registered proprietors of the properties. On 14th March 2006, they had charged the properties to Standard Chartered Bank Kenya Limited (Standard Bank) to secure banking facilities extended to East Cape Enterprises Limited. There was default in repayment of the secured debt and Standard Bank threatened to sell the properties in exercise of its statutory power of sale.

3. To salvage the situation, the appellants approached the 1st respondent, a relative by marriage, for assistance with a view to redeeming the properties from Standard Bank. To that end, the appellants and the 1st respondent entered into an arrangement under which the 1st respondent would take a loan from Savings and Loan (K) Ltd (Savings & Loan), where the 1st respondent was already a customer, which would be applied to redeem the charge in favour of Standard Bank. The obligation to service the Savings & Loan facility would however be by the appellants.

4. According to the 1st respondent, for that arrangement to work, he needed to settle his own debt with Savings & Loan which stood at Kshs.600,000. 00 and the appellants agreed to make that payment to Savings & Loan without any obligation on the part of the 1st respondent to ever repay them.

5. Based on that arrangement, on 8th October 2007 the appellants and the 1st respondent executed a loan agreement prepared by Mr. Khatib (PW3) of Khatib & Company Advocates under which it was agreed and stipulated that: the 1st respondent would borrow Kshs.3,500,000. 00 from Savings & Loan to be used to offset the appellants loan with Standard Bank; that the appellants would transfer the titles over the properties to the 1st respondent to enable him secure the loan from Savings & Loan; that the appellants would “bear the full responsibility to repay the loan” and would remit the monthly instalments payable to Savings & Loan; that in default of payment by the appellants, the 1st respondent would pay any outstanding instalment to Savings & Loan and “recover” from the appellants; that upon full payment of the loan to Savings & Loan, the 1st respondent would transfer the properties back to the appellants.

6. Evidence was led that in order for Savings & Loan to extend the loan to the 1st respondent, it required an agreement for sale of the properties between the appellants and the 1st respondent. In that regard, the appellants and the 1st respondent entered into an agreement for sale dated 8th October 2007, also drawn by Mr. Khatib and executed in his presence, under which the appellants agreed to sell, and the 1st respondent agreed to purchase the properties for a consideration of Kshs.5,000,000. 00. Although there was consensus that the parties entered into a sale agreement, there was some controversy as to precisely which agreement was executed as two agreements, one with a consideration of Kshs.5,000,000. 00 and another one with a consideration of Kshs.4,000,000. 00 were produced as exhibits. Mr. Khatib did however explain in his testimony how this came about and nothing really turns on it for purposes of this appeal.

7. What followed was that the appellants’ debt with Standard Bank was settled from the proceeds of the loan from Savings & Loan. The charge over the properties in favour of Standard Bank was discharged on 17th April 2008. On the same date, the properties were transferred to the 1st respondent and immediately charged to Savings & Loan. With Standard Bank out of the picture and off their back, the appellants were left to deal with the Savings & Loan debt. Up to that point, all appears to have been “hunky-dory”, as it were, between the appellants and the 1st respondent. The events that followed, over which there is divergence in material respects, gave rise to the dispute the subject of the suit that has culminated in this appeal.

8. The appellants claim that they kept their promise and made payments amounting to Kshs.900,000. 00 into the account of the 1st respondent at Savings & Loan “which were advance instalments of the repayments” due to Savings & Loan. In her testimony, 1st appellant stated that they paid Kshs.600,000. 00 to the 1st respondent and “were under the impression that he [would] use the said sum to start paying off the loan to Savings and Loan (K) Ltd”; that between July and September 2009, they deposited a sum of Kshs.284,000. 00 into the 1st respondent’s account at Savings & Loan in payment of instalments despite which, it transpired, the loan was not being serviced and that the 1st respondent became very un-cooperative; that on 13th August 2009, the 1st respondent, made written demand of Kshs.6,070,000. 00 being the loan amount plus interest which surprised them because they knew that the loan repayments to Savings & Loan were up to date.

9. The 1st appellant stated further in her testimony that on the same day, 13th August 2009, the appellants received information that the 1st respondent was selling the properties to the 2nd and 3rd respondents whereupon they instructed their advocates, Khatib & Company advocates who wrote to the firm of Makasembo & Company advocates, who were apparently involved in the transaction with the 2nd and 3rd respondents, indicating that the properties were not for sale. Their endeavors to intervene and prevent the transfer of the properties to the 2nd and 3rd respondents, the 1st appellant stated, were not successful. On 8th September 2009, the 1st respondent transferred the properties to the 2nd and 3rd respondents.

10. The appellants averred that the transfer of the properties by the 1st respondent to the 2nd and 3rd respondents was fraudulent because the 1st respondent: had no authority to sell the properties; failed to pay the monthly instalment to Savings & Loan and allowed the loan account to fall in arrears when the appellants had paid him monies for the instalments; causing the loan to fall into arrears with a view to having the properties sold; and failing to notify the appellants of the intended sale and offering the same to the 2nd and 3rd respondents without informing the appellants. The appellants contended that the 2nd and 3rd respondents were equally guilty of fraud for, among other reasons, buying the properties from the 1st respondent without carrying out due diligence.

11. The testimony of the 1st respondent, on the other hand was that having taken the Savings & Loan facility and having cleared the appellants’ loan with the Standard Bank, the appellants reneged on their obligations and failed to pay the monthly instalments to Savings & Loan; that Savings & Loan wrote several reminders to him demanding payment and eventually advertised the properties for sale by public auction; that Savings & Loan finally allowed him to look for a willing buyer for the properties and he was able to get the 2nd and 3rd respondent who agreed to purchase the properties for a price of Kshs.10,000,000. 00 and entered into a sale agreement with them on 16th February 2009.

12. He testified that prior to entering into the agreement for sale with the 2nd and 3rd respondent, he personally informed the appellants who made promises to make the necessary payments to Savings & Loan but failed to honour their promises; that even after the properties had been transferred to the 2nd and 3rd respondent, the appellants still got a chance to re-purchase them and indicated they would raise the amount the 2nd and 3rd respondent had paid but failed to do so.

13. The 2nd respondent, a resident and businessman in Mombasa, testified on his own behalf and on behalf of his wife, the 3rd respondent and stated that in 2009 he was in the market looking for a property to purchase; that he engaged a property agent, one Robert, who introduced him to the 1st respondent; that he met the 1st respondent and after negotiations, he agreed to purchase the properties for Kshs.10,000,000. 00; that they proceeded to the advocates, who after conducting a search over the properties drew up the sale agreement; that upon payment of the required deposit, of Kshs.7,000,000. 00 he visited the property and found a couple and informed them that he was the new owner and was taken round the house by their son; that he was informed by Robert, the property agent, that the couple he found in the property were tenants; that subsequently the properties were transferred to him and he charged them to Diamond Trust Bank which financed the purchase.

14. After reviewing the evidence, the learned Judge summed up the dispute this way:

“The dispute in my view is between the [appellants] and the 1st[respondent] on what were the terms of this arrangement if at all and who was in breach. Once this is determined, then the question of transfer to the 2nd [respondent]is easily answered. The first question therefore is to determine the terms of arrangement reached between the[appellants]and the first[respondent].”

15. The Judge found as a fact that the relationship between the appellants and the 1st respondent was governed by the loan agreement of 8th October 2007 and the sale agreement of the same date under the terms of which, inter alia, the 1st respondent was duty bound to re-transfer the properties to the appellants upon the repayment of the loan to Savings and Loan. The Judge also found that the appellants defaulted in their obligations to make payments to Savings & Loan and that at the time the 1st respondent offered the properties for sale to the 2nd and 3rd respondents, the loan taken from Savings & Loan was in arrears and the appellants “were at fault since they were the ones obligated to settle the due instalments”.

16. It was also a finding by the Judge that there was nothing stopping Savings and Loan from realizing the securities in case of default by the borrower and it went ahead and advertised the properties for sale by public auction but the 1st respondent opted for sale by private treaty to get a better price than an auction was bound to fetch; that as there was default on the repayments of instalments due from the appellants to Savings & Loan, the 1st respondent had the capacity to sell the properties to pay off the loan. In effect, the Judge was not persuaded that the appellants had established any fraud as against the 1st respondent.

17. In as far as the 2nd and 3rd respondents are concerned, the Judge found that they must have known that the appellants had an interest in the property; that although the sale of the property from 1st respondent to the 2nd and 3rd respondents was done in February 2009, the transfer was not effected until September 2009; that despite the appellants having been given an opportunity by the 1st respondent to raise money to enable him rescind the sale to the 2nd and 3rd respondents, they failed to do so.

18. In the end, the Judge in effect rejected claims by the appellants that there was fraud in the registration of the transfer of the properties in favour of the 2nd and 3rd respondents on 8th September 2009. However, the Judge ordered the 1st respondent to account to the appellants for all monies received from the sale and to pay over to them any surplus.

19. As already indicated, the appellants have appealed against that decision primarily on grounds that the Judge misapprehended the evidence and that, as the 2nd and 3rd respondents were not innocent purchasers for value without notice of the appellants’ interest, the Judge erred in sustaining the transfer of the properties in their favour.

20. Urging the appeal before us, Mr. Jengo, learned counsel for the appellants submitted, in his written submissions which he orally highlighted, that the learned Judge misconstrued the nature of the relationship between the appellants and the 1st respondent based on the loan agreement and the agreement for sale between them. In what appears to be a departure from the case the appellants presented before the trial court, counsel urged that a proper interpretation should have led the Judge to the conclude that the relationship created was one of “an English Mortgage”as defined by the High Court in the case ofKaniki Karisa Kaniki vs. Commercial Bank Ltd & 2 others [2016] eKLR.

21. It was submitted that the Judge: wrongly construed the said agreements subjectively rather than objectively; overlooked the express provisions of the agreements regarding the consequences of the appellants failure to pay the installments to Savings & Loan; and wrongly concluded that the 1st respondent was entitled to sell or prompt the chargee, Savings & Loan, to sell the properties; that contrary to the finding by the Judge, all the 1st respondent was entitled to do in the event of default by the appellants was to “recover” any outstanding instalments he may have paid to Savings & Loan on the appellants behalf; that if the appellants defaulted in payment to Savings & Loan, the 1st respondent was to pay and then demand reimbursement from the appellants.

22. Furthermore, Mr. Jengo submitted, it was not established that the appellants were in default as the amount of Kshs.942,000. 00 demonstrated to have been paid by the appellant was sufficient to cover the instalments payable to Savings & Loan; that there was no evidence to show that the loan with Savings & Loan was in arrears; that there was no pleading before the trial court that the appellants were in breach of the loan agreement or that the amount the appellants paid did not match the expected instalments; and that the Judge went outside the pleadings and erred in dealing with matters that were not properly before the court. In that regard counsel cited the High Court decision of Muthoni Nduati vs. Wanyoike Kamau & 5 others [2004] eKLRfor the proposition that parties, and the court, are bound by pleadings.

23. It was submitted further that the properties were registered under the repealed Registration of Titles Act, Cap 281 and thatmthe transfers to the 2nd and 3rd respondent were undertaken during the operation of that Act; that having found that the 2nd and 3rd respondent were aware of the appellants interest in the properties, they were not innocent purchasers of the properties for value and fraud, within the meaning of Section 23 of that Act, was established and the Judge should therefore have nullified the transfers in their favour. Reference was made also to Section 26 of the Land Registration Act to support the contention that the title in favour of the 2nd and 3rd respondents should have been nullified and that the 1st respondent had no power to sell the properties and could not therefore pass any title to the 2nd and 3rd respondents. The decision of this Court in Arthi Highway Developers Ltd vs. West End Butchery Ltd & 6 other [2015] eKLRwas cited.

24. It was submitted that the appellants remain in possession of the properties and under Section 116 of the Evidence Act, the 2nd and 3rd respondents had the burden of proving that the appellants are not the owners but they did not discharge that burden; that in any case, the transfers to the 2nd and 3rd respondents have not been completed since vacant possession has still not been given to them and the full purchase price for the properties has never been paid.

25. Miss. Annah Kamau, learned counsel for the 1st the respondent, relying on written submissions in her oral highlights submitted that the learned Judge properly evaluated and analyzed the evidence and correctly concluded that the appellants had defaulted in their obligations in the payment of instalments to Savings & Loan; that based on the arrangement between the appellants and the 1st respondent, the 1st respondent was entitled to sell the properties and did not require the appellants authority to do so. It was submitted that based on the evidence, the learned Judge correctly concluded that the sale of the properties to the 2nd and 3rd respondents was proper, although, according to counsel, the sale was not concluded because only 10% of the purchase price was paid.

26. It was submitted that what the appellants were in effect seeking, in their attempt to impeach the sale and transfer of the properties by the 1st respondent to the 2nd and 3rd respondents, is for the court to rewrite the terms of the agreement, which is outside the province of the courts. The case of Richard Akwesere Onditi vs. Kenya Commercial Finance Company Limited, Kisumu C.A. No. 329 of 2009was cited.

27. It was submitted: that it is not correct, as urged by the appellants, that the trial court found that the 2nd and 3rd respondents were not bona fide innocent purchasers of the properties; that all the trial court stated was that they were aware of the appellants interest in the properties; that the appellants failed to discharge their burden of proof that the 1st respondent fraudulently transferred the properties to the 2nd and 3rd respondents.

28. As already noted, counsel for the 1st respondent however faulted the Judge for concluding that the sale to 2nd and 3rd respondents was “perfected” when, according to the evidence of 1st respondent, he “only received” 10% of the purchase price and that the transfers were done before he had been paid the full purchase price; that consequently, the order by the Judge for the 1st respondent to release monies to the appellant that he never received is erroneous, and this Court should “overturn this finding”so as “to allow for time to conclude the transaction between the respondents.” Counsel urged the Court to set aside the finding by the trial court that the transaction between the respondents was perfected and order the 2nd and 3rd respondents to release the balance of the purchase price to the 1st respondent.

29. Mr. K.N. Kibara, learned counsel for the 2nd and 3rd respondents, also relied on written submissions which he highlighted. He submitted that the contention by the appellants that an English mortgage was created by dint of the loan and sale agreements between the appellants and the 1st respondent is unfounded; that the only charge created was the registered legal charge in favour of Savings & Loan; that the appellants were not privy to that charge and would have no basis for challenging the chargees exercise of its statutory power of sale; that the learned Judge correctly interpreted the loan agreement and rightly concluded that the 1st respondent had the capacity to sell the properties to the 2nd and 3rd respondent; that evidence was led that Savings & Loan required a sale agreement between the appellants and the 1st respondent in order to extend the loan facility; that a search conducted by the 2nd and 3rd respondents prior to purchasing the properties indicated that the 1st respondent was the registered proprietor; that on the strength of the sale agreement and transfers executed by the appellants in favour of the 1st respondent, the transfer in favour of the 2nd and 3rd respondent cannot be impeached.

30. It was submitted that the claim by the appellants that the Judge found that the 2nd and 3rd respondent were not bona fide purchasers of the properties is factually incorrect; that on the contrary, all the Judge stated was that the 2nd and 3rd respondent knew of the appellants’ interest in the property, which is a different matter from claiming that they were not bona fide purchasers; and that the Judge rightly concluded that the registration of the transfers in favour of the 2nd and 3rd respondent could not be faulted. Counsel made reference to the decision of this Court in Mugo Muiru Investments Limited vs. EWB & 2 others [2017] eKLRfor the proposition that a certificate of title issued by the registrar to a purchaser of land upon transfer is conclusive evidence of proprietorship impeachable only on grounds of fraud or misrepresentation; that the appellants duly executed transfers of the properties in favour of the 1st respondent and thereby relinquished their proprietorship rights and consequently the 1st respondent as the registered proprietor had the capacity to dispose of the properties to the 2nd and 3rd respondents.

31. It was submitted that the claims that the full purchase price was not paid are incorrect; that the manner in which the 2nd and 3rd respondent were to pay the purchase price of Kshs.10,000,000. 00 was stipulated in the agreement for sale dated 16th February 2009 under clause 3; that Kshs.6,000,000. 00 was acknowledged as paid upon execution of the agreement; that in the duly executed Transfers in favour of the 2nd and 3rd respondents the full purchase price was acknowledged as having been paid in full at rate of 2. 5 million per plot; that the 1st respondent acknowledged that the deposit was paid on signing the agreement and the balance remitted to the advocates and that is why he was able to transfer the properties to the 2nd and 3rd respondents. It was submitted that the properties were properly registered in the names of the 2nd and 3rd respondent and the claims of fraud are unsupported by any evidence.

32. Having considered the appeal, which is a first appeal, in accordance with our mandate under Rule 29 of the Court of Appeal Rules and as articulated in Selle & another vs. Associated Motor Boat Co Ltd & others [1968] E.A. 123, the only issue arising for determination is whether the appellants established before the trial court, to the required standard, that the sale and transfer of the properties by the 1st respondent to the 2nd and 3rd respondents was fraudulent and illegal as pleaded in paragraph 14 of their plaint. We have already referred to the particulars of fraud that the appellants as pleaded.

33. In Arthi Highway Developers Limited -vs- West End Butchery Limited & 6 Others [2015] eKLRto which counsel referred, this Court adopted the definition of fraud as set out in Black’s Law Dictionary, as follows:

“Fraud consists of some deceitful practice or willfuldevice, resorted to with intent to deprive another of his right, or in some manner to do him an injury. As distinguished from negligence, it is always positive, intentional. As applied to contracts, it is the cause of an error bearing on a material part of the contract, created or continued by artifice, with design to obtain some unjust advantages to the one party, or to cause an inconvenience or loss to the other. Fraud, in the sense of a court of equity, properly includes all acts, omissions, and concealments which involve a breach of legal or equitable duty, trust, or confidence justly reposed, and are injurious to another, or by which an undue and unconscientious advantage is taken of another.”

34. Reference was made in that decision to Section 2 of the repealed Registration of Titles Act which defined ‘fraud’ as follows:

“‘Fraud’ shall on the part of a person obtaining registration include a proved knowledge of the existence of an unregistered interest on the part of some other person, whose interest he knowingly and wrongfully defeats by that registration.”

35. The Court stressed that fraud is a serious accusation which, procedurally, has to be pleaded and proved to a standard above a balance of probabilities but not beyond reasonable doubt and that general allegations, however strongly worded, are insufficient to amount to an averment of fraud of which any court ought to take notice and that fraud is, however, a matter of evidence.

36. More recently in Eldoret Express Limited vs. Tawai Ltd and another [2019] eKLR, this Court stated that:

“Fraud is a serious thing to allege and there is a requirement that it be particularized and then proved to a standard that is higher than a mere balance of probabilities. See R. G. PATEL -vs-LALJI MAKANJI [1957] EA 314. The degree of proof must be such as to create a moral certainty though it need not reach the criminal standard of proof beyond reasonable doubt. This has to be so because allegations of fraud in a civil suit carry with them an element of criminality and are referred to as being quasi-criminal in nature. As Esther put it more than a century ago in LE LEURE -vs- GOULD [1895] 1 & B. 491 at p. 498,

“a charge of fraud is such a terrible thing to bring against a man that it cannot be maintained in any court unless it is shown that he had a wicked mind.”

Thus, it is not enough that a party should cry ‘fraud’’ they must back it up with clear particulars and prove it with satisfactory and solid evidence.”

37. Given those parameters, did the appellants present sufficient evidence before the trial court on the basis of which their plea of fraud could be sustained? Did they discharge their burden of proof?

38. There is no dispute that the appellants entered into an agreement with the 1st respondent on 8th October 2007 under which the 1st respondent, at the appellants’ request, agreed to take a loan with Savings & Loan to settle the appellants’ debt with Standard Bank. It was a bail out arrangement. The appellants agreed to transfer the properties to the 1st respondent to enable him to obtain the Savings & Loan facility and the appellants undertook to repay the Savings & Loan facility “by monthly instalments which the Bank will advise.” The agreement stipulated that in default of payment of the instalments by the appellants, the 1st respondent “may pay to the Bank any outstanding instalment and recover” from the appellant and that upon full payment of the loan to Savings & Loan, the 1st respondent would transfer the properties back to the appellants.

39. In addition, on the same date, the appellants entered into an “agreement of sale”for the outright sale of the properties to the 1st respondent subject to the charge by Standard Bank which the appellants undertook to clear before the final transfer to the 1st respondent.

40. There was no suggestion at all that the appellants did not enter into those agreements with the 1st respondent with their eyes wide open, freely and voluntarily. It was on that basis that the appellants transferred the properties to the 1st respondent who became the registered proprietor on 17th April 2008.

41. The appellants asserted that they kept their promise and paid sufficient amount of money into the 1st respondent’s account at Savings & Loan; and that had the 1st respondent applied those funds to the required repayment instalments; the property would never have come under threat of sale by Savings & Loan in exercise of its power of sale. They say that they paid approximately Kshs.900,000. 00 made up of an initial Kshs.600,000. 00 and Kshs.284,000. 00 between July and September 2009.

42. The claim that Kshs. 600,000. 00 was paid to fund the instalment payments to Savings & Loan is not credible. In one breath, the 1st appellant stated that they paid Kshs.600,000. 00 to the 1st respondent and “were under the impression that he [would] use the said sum to start paying off the loan to Savings and Loan (K) Ltd”. Elsewhere, she stated that, “we paid the 1stdeft(sic)a sum of Kshs.600,000. 00 to offset his previous loan from Savings and Loan [K] Ltd so that he could get a new loan of Kshs.3,500,000 which he would give us to pay Standard Chartered Bank Ltd.” The latter statement accords with the 1st respondent’s own testimony that he had a pre-existing loan with Savings & Loan which he had to clear before he could apply to Savings & Loan for the bail out loan. Accordingly, claim by the appellants that they paid over Kshs.900,000. 00 into the 1st respondents account to cater for the instalments cannot therefore be true and the learned trial Judge rightly concluded that they defaulted in their payments.

43. Furthermore, on appellants own evidence, the amount of Kshs.284,000. 00 was not paid until “between July and September 2009” whilst, evidently the charge in favour of Standard Bank had been discharged on 17th April 2008 and the one in favour of Savings & Loan registered on the same date, lending credence to their default. Moreover, evidence was presented that Savings & Loan, through auctioneers, advertised the properties for sale by public auction that was scheduled to take place on 19th February 2009 in exercise of its power of sale, again giving credence to the evidence tendered by the 1st respondent that he requested Savings & Loan to permit sale by private treaty to forestall the public auction with a view to fetching a better price than that which would likely have been realized in a forced sale.

44. In light of the foregoing, there was no evidence before the trial court, least of all to the standard required, on the basis of which the appellants’ plea of fraud on the part of the 1st respondent could be sustained. The appellants did not, in our view discharge their burden of proof. Having been registered as the proprietor of the properties, the 1st respondent had all the rights appurtenant thereto including the right to sell the same and nothing prevented him, as the Judge correctly found, from doing so.

45. On the part of the 2nd and 3rd respondents, evidence was led that the 2nd respondent was in the market looking for property to buy and was introduced to the 1st respondent by an estate agent; that the 2nd respondent did inspect the properties, and was assured those in occupation were tenants and conducted a search prior to transacting with the 1st respondent. We are in the circumstances persuaded that in making the finding that the

2nd and 3rd respondents were aware of the appellants interest in the properties, the Judge did not mean that they were not bona fide purchasers and that the transfer in their favour, was by that reason alone, impeachable.

46. All in all, we are satisfied that there was insufficient evidence before the trial court to sustain the appellants’ suit for nullification of the title in favour of the 2nd and 3rd respondents on grounds of fraud.

47. The 1st respondent in his submissions urged us to set aside the portion of the Judgement ordering him to render an account and pay over the surplus sale proceeds. We are unable to entertain that claim. The 1st respondent did not appeal the judgment neither did he cross appeal.

48. The appeal fails. It is accordingly dismissed with costs to the 2nd and 3rd respondents only.

Dated and delivered at Nairobi this 29thday of January, 2021.

W. OUKO, (P)

…………………………

JUDGE OF APPEAL

M.K. KOOME

…………..…………….

JUDGE OF APPEAL

S. GATEMBU KAIRU, (FCIArb)

…………….………….

JUDGE OF APPEAL

I certify that this is a true

copy of the original.

Signed

DEPUTY REGISTRAR