LANDMARK CASE: WHAT IS THE IMPLICATION OF RECENT SUPREME COURT JUDGMENT CURRENT READ ON 21ST APRIL 2023 ON FRAUDULENT LAND ACQUISITION: DINA MANAGEMENT LIMITED –VS- COUNTY GOVERNMENT OF MOMBASA & 5 OTHERS [PETITION 8 (E010) OF 2021]

  • The key implication in this case is based on conduct due diligence in Land Transactions whereby purchaser is expected to have exercised detailed investigation of property’s ownership, the history and actual parties taking part in the transaction so as to identify any risks that may arise from a proposed transaction. This will all the way enable the purchaser to ensure full compliance with ALL legal and regulatory requirements in order to avoid any further liability. In this regard, all parties in the transactions must provide necessary documents needed for conduct of due diligence. 
  • In this landmark judgement, the Supreme Court confirmed the position that a purchaser is required to widen the scope of due diligence to interrogate the root and foundation of the title issued. Following the Supreme Court decision, it is now clear that no party can insist that they are an innocent purchaser for value, if there is an issue with the root or foundation of the title. The court reasserted the position that the doctrine of a bonafide purchaser cannot seek protection in law, where the title for a piece of property was obtained irregularly.
  • In this case, the dispute arose with respect to the ownership of Property Title Number MN/1/6053 situated in Nyali Beach, Mombasa County. The suit property was allocated and thereafter a freehold title issued to the first registered owner, over the said property, by the Commissioner of Lands in 1989. The suit property was subsequently sold to a second purchaser and finally to the Appellant In the ensuing period, the County Government of Mombasa entered the suit property, which was adjacent to the beach, demolished the parameter wall facing the beachfront and flattened the property to the same level of the beach, on the premise that the land was designated as an open space. In arriving at the decision, the Supreme Court indicated that a title deed is not sufficient proof of ownership of a title that has been challenged. The owner of the title deed must go beyond the instrument and show that the acquisition was legal from the beginning.

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