[2020] KEHC 3100 (KLR)
The court found that the debt to Post Bank (in liquidation) was a proven liability of the estate, supported by documentary evidence and correspondence. The property L.R. Ntirimiti Settlement Scheme/149 was still charged to the bank, making it the appropriate asset to be sold to settle the debt. The interested...
Source-derived case information.
- Citation
- [2020] KEHC 3100 (KLR)
- Parties
- Applicant: Sarah Mwaka Kathurima; Respondent: Joseph Kimathi Kathurima
- Court
- High Court
- Court Station
- High Court at Meru
- Jurisdiction
- Kenya
- Case Number
- Succession Cause 109 of 2016
- Procedural Posture
- Succession Cause / Ruling on Application for Leave to Sell Estate Property to Settle Debt and for Confirmation of Grant
- Outcome
- Application allowed; leave granted to sell L.R. Ntirimiti Settlement Scheme/149 to settle estate debt; interim certificate of confirmation of grant issued.
- Judges
- A Mabeya, F Gikonyo
- Legal Topics
- Administration of Estates, Confirmation of Grant, Payment of Debts, Distribution of Estate
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Sarah Mwaka Kathurima
Applicant
Joseph Kimathi Kathurima
Respondent
Procedural Posture
Succession Cause / Ruling on Application for Leave to Sell Estate Property to Settle Debt and for Confirmation of Grant
Legal Issues
- 1 Whether the petitioner should be granted leave to sell L.R. Ntirimiti Settlement Scheme/149 to settle the estate's debt to Post Bank (in liquidation).
- 2 Whether the debt owed to Post Bank is properly ascertained and forms a liability of the estate to be settled prior to distribution.
- 3 Whether the property to be sold should be L.R. Ntirimiti Settlement Scheme/149 or Ngusishi Settlement Scheme No. 10.
Ratio Decidendi
The court found that the debt to Post Bank (in liquidation) was a proven liability of the estate, supported by documentary evidence and correspondence. The property L.R. Ntirimiti Settlement Scheme/149 was still charged to the bank, making it the appropriate asset to be sold to settle the debt. The interested party's contrary assertions were unsupported by evidence and thus disregarded. The court emphasized that debts must be settled before any distribution of the estate, and the petitioner, as administratrix, was acting within her statutory duties. The application to sell the property and pay the debt was therefore merited and allowed, with an interim certificate of confirmation of grant...
Court Disposition
Application allowed; leave granted to sell L.R. Ntirimiti Settlement Scheme/149 to settle estate debt; interim certificate of confirmation of grant issued.
Orders
- Petitioner granted leave to sell L.R. Ntirimiti Settlement Scheme/149 through private treaty for the purpose of settling the estate's debt to Post Bank (in liquidation).
- An interim certificate of confirmation of grant shall issue distributing L.R. Ntirimiti Settlement Scheme/149 to the petitioner for the sole purpose of its sale and payment of liabilities.
Full Case Text
Judgment text and source record
29 paragraphs
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA
AT MERU
SUCCESSION CAUSE NO. 109 OF 2016
SARAH MWAKA KATHURIMA …………….….…… PETITIONER
VERSUS
JOSEPH KIMATHI KATHURIMA ………... INTERESTED PARTY
R U L I N G
1. On 11/12/2019, this Court revoked the grant that had been issued to the petitioner and ordered that a full inventory of the assets and liabilities of the deceased be filed. The petitioner was to file a fresh application for confirmation of grant and the beneficiaries to file their respective responses.
2. Consequently, the petitioner filed a fresh application for confirmation of grant on 5/3/2019. Contemporaneously, she also filed an application seeking leave to be allowed to sell L.R. Ntirimiti Settlement Scheme/149 through private treaty for purposes of repaying of an outstanding loan of Kshs.12,000,000/= with Post Bank (in liquidation). She attached correspondence from the bank showing that the estate owed the bank Kshs. 43, 081,497/60 but had been negotiated to KShs.12,000,000/=.
3. The Interested Party opposed the application stating that the petitioner had concealed the actual amount owed by the bank. That he had it on good authority that the actual amount owing to the estate was Kshs. 4,000,000/=. He further averred that 11. 3 acres in L.R. No. Ngusishi Settlement Scheme No. 10 allocated to him by the petitioner in the proposed distribution ought to be used to settle the amount owed the bank.
4. In a brief rejoinder, vide supplementary affidavit filed on 8/7/2020, the petitioner denied the averments made by the interested party and retorted that she had written to the interested party’s advocates disclosing the particulars of the intended purchaser and the purchase price. She annexed a copy of the letters dated 9/3/2020 and 10/3/2020. She was against selling of L.R. No. Ngusishi/S.Scheme/10 as a substantial part of it constitutes her matrimonial home.
5. In re Estate of Barrack Deya Okul (Deceased) [2018] Eklr, the court held: -
“My clear understanding of this requirement is that once a Petitioner is notified of the existence of a liability (debt) by a creditor or once the Petitioner comes to learn of an existing proven liability (debt) owed by the estate, it is mandatory to include such a liability or debt as required above.
6. Section 86 of the Law of Succession Act provides that debts of every description enforceable at law and owed by or out of an estate shall be paid before any legacy.
7. Section 83 (d) of the Act provides that one of the duties of personal representatives is ascertaining and paying, out of the estate of the deceased’s debts.
8. In her petition, the petitioner set out the liabilities of the estate of the deceased which included monies owed to Post Bank Limited (in liquidation). She produced a copy of the search records that showed that the deceased had charged the property for KShs.800,000/=. She contended that she had negotiated the debt to Kshs.12,000,000/= and attached correspondence from the bank to that effect.
9. On the other hand, the contentions by the interested party were not supported by any evidence. They remained unsubstantiated. It is trite that he who alleges must prove. Without cogent evidence to back his claims, the allegations by the interested party remained just that, mere allegations.
10. As pointed out earlier, a debt is a liability against the estate. It must be paid out as the first point of call. From the search records, the property is still charged to the bank. It is therefore the proper asset to be disposed as opposed to LR. No. Ngusishi Settlement Scheme No. 10.
11. The proceeds of the sale and the balance thereof will be made clear to the court as it is part of the responsibility of the petitioner/administratrix.
12. In this regard, I find merit in the petitioner’s application dated 4/3/2020. The same is allowed in terms of prayer Nos. 1 and 2 thereof. An interim certificate of confirmation of grant shall issue distributing L.R. Ntirimiti Settlement Scheme/149 to the petitioner for the sole purpose of its sale through private treaty and subsequent paying out of the liabilities owing to the estate of the deceased. This order is made under Rule 41(3) of the probate and Administration Rules.
13. The application for confirmation of grant shall be dealt with after taking into account the liabilities paid out as a result of the sale.
It is so ordered.
Signed at Meru: -
A. MABEYA
JUDGE
DATED and DELIVEREDat Meru this 17th day of September, 2020
F. GIKONYO
JUDGE