Court hands victory to company in landmark Sh8bn property case

The Court of Appeal has overturned a landmark judgment involving a prime 135-acre property valued at more than Sh8 billion, awarding ownership to Muchanga Investments, a company incorporated by former Vice President Moody Awori, his wife and former President Jomo Kenyatta’s lawyer, Francis Da Gama Rose.

The Environment and Land Court had previously ruled that neither Muchanga Investments nor rival claimants Telesource.com and Joseph Milimu Konzolo had proved ownership of the land. Justice Oscar Angote ordered that the property should revert to the estate of its original owner, Arnold Bradley.

However, Court of Appeal judges Patrick Kiage, Stephen Radido and Rachel Ngetich overturned that decision, holding that although Muchanga had not produced an executed sale agreement with Barclays Bank, the company had demonstrated continuous possession of the property until the suit was filed.

 “The appellant having demonstrated that it was continually in possession of the suit property until when the suit herein was filed, we respectfully find that the learned Judge erred when he impeached the appellant’s title on the basis that it had not furnished an executed sale agreement. The totality of the evidence significantly and unerringly shows that the appellant is the legally registered owner of the suit property,” the judges ruled.

Following the Environment Court’s decision, Bradley’s descendants, represented by Imogen Poppleton, sought to join the proceedings, arguing that Barclays Bank had neither authority nor consent to dispose of the property. They maintained they only became aware of the dispute through newspaper reports

The appellate court, however, held that the family had come too late, noting that they had never challenged Barclays’ administration of Bradley’s estate before the Family Court.

The judgment raises fresh questions over whether Barclays accounted to Bradley’s beneficiaries for the proceeds from the sale.

The judges also accepted Muchanga’s argument that correspondence exchanged between Barclays’ lawyers, Kaplan & Stratton, and Francis Da Gama Rose Advocates demonstrated that the transaction had taken place.

For more than a decade, Muchanga battled several individuals and companies claiming ownership of the valuable property.

The dispute became even more complex after the Environment Court’s ruling when 82-year-old Peter Geoffrey Sell filed proceedings before the Family Court claiming to be Bradley’s nephew.

Awori told the court that he incorporated Muchanga Investments on April 18, 1978, but resigned as a director after he was appointed Vice President in 2003.

Muchanga sued Telesource.com, Habenga Holdings Ltd, Jina Enterprises, John Mugo Kamau and Carmelina Ngami, the widow of former Nairobi Provincial Commissioner Joseph Kange’the

In response, Telesource and Joseph Milimu Konzolo countersued, with all parties laying claim to the prime land.

Muchanga maintained that it bought the property from Barclays Bank, acting as executor of Bradley’s estate, for Sh1.25 million. Executive director Francis Da Gama Rose testified that negotiations began in 1982 before the land was transferred to the company in 1983.

The rival claimants argued that the property belonged to J.G. Mburu. Before her death, Ngami alleged that Da Gama Rose had failed to include the land among Mburu’s assets during the administration of his estate.

Justice Angote rejected all the competing claims, nullified the disputed titles and ordered that the land revert to Bradley’s estate.

He directed the Public Trustee to trace Bradley’s surviving heirs and transfer the property to them, failing which the land would revert to the Government.

During the trial, Barclays Bank maintained that it lawfully administered Bradley’s estate and transferred the property to Muchanga.

The bank said it had also held the title as security for a loan advanced to Da Gama Rose between 1983 and 1989 before releasing it after the loan was fully repaid.

He told the court the property was charged on August 30, 1983, before a discharge of charge was issued on March 7, 1989, after the loan had been fully repaid.

Barclays dismissed claims by Telesource that the land had been acquired through John Mugo Kamau, noting that Bradley died in 1973, making any purported sale in 1978 impossible.

The court also heard an application by lawyer Lucy Njeri, who sought to join the proceedings on behalf of Ngami.

Ngami claimed she had reported the alleged mismanagement of  Mburu’s estate to anti-corruption investigators and questioned how Muchanga had acquired the property.

She accused Muchanga of fraudulently obtaining the land.

Barclays, however, distanced itself from her claims, stating that it neither knew nor recognised her authority to represent the estate. She was subsequently removed from the proceedings.

Justice Angote nevertheless found documents indicating that Mburu had been registered as proprietor of the property on March 7, 1978.

However, he concluded there was no evidence that Mburu paid the Sh1.25 million purchase price or lawfully acquired the land.

He also ruled that Mathenge lacked authority to represent Mburu’s estate because no grant of representation had been produced.

Justice Angote had ruled that there was insufficient evidence to prove the property had been lawfully sold by Barclays Bank on behalf of Bradley’s estate.

He therefore nullified the titles held by Muchanga, Telesource, Habenga Holdings, Jina Enterprises and other claimants, ordering that the land revert to Bradley’s estate.

The judge directed the Public Trustee to trace Bradley’s surviving heirs and transfer the property to them. If no beneficiaries could be identified, he ordered that the land revert to the Government.

During the trial, Barclays Bank maintained that it had lawfully administered Bradley’s estate and transferred the property to Muchanga. The bank also said it had held the title as security for a loan advanced to Francis Da Gama Rose before releasing it after the loan was repaid.

The Court of Appeal, however, reached a different conclusion, finding that the evidence presented was sufficient to establish Muchanga’s ownership despite the absence of an executed sale agreement. The appellate judges therefore overturned Justice Angote’s ruling and restored the title to Muchanga Investments.