On compliance during land regime transitions & Indefeasibility is not absolute: The Case of Frank Logistics Limited v Golden Lion Real Estate Company & 6 Others Civil Appeal E303 of 2024

Full Case: Frank Logistics Limited v Golden Lion Real Estate Company & 6 others (Civil Appeal E303 of 2024) [2025] KECA 1471 (KLR)

 Background & Lower Court History

• Golden Lion Real Estate (First Respondent) bought a property known as LR No. 1/835 (Original Number 1/225/5) — which includes “Blacky’z Lounge” located along Argwings Kodhek Road, Kilimani, Nairobi — from Propco Limited in 2014.
• Golden Lion alleged that although it was the registered proprietor, Frank Logistics (Appellant) interfered with it: by claiming ownership, effecting a transfer, obtaining a certificate of title L.R. No. 1/381 [I.R. No. 200711] in its name, charging the property in favour of another respondent, among other dealings, despite prior court orders restraining such dealings.
• Golden Lion sued (Environment & Land Court case 792 of 2015) seeking declarations that the transfer and charge were illegal/null, permanent and mandatory injunctions, and, in the alternative, possession of the property.
• Frank Logistics defended, contending that:
• It was properly registered as proprietor;
• It had done due diligence;
• There were discrepancies in the title submissions by Golden Lion;
• Some of Golden Lion’s claims lack proof.
• Environment & Land Court (Mogeni, J.) in a judgment delivered on 11 April 2024 found in favour of Golden Lion. The court held that the appellant’s title had been procured in an unprocedural manner, that Golden Lion had validly registered title, and that transfer to appellant was unlawful. The title held by the appellant was cancelled, mandatory injunction for cancellation ordered, and Golden Lion was declared the rightful owner.

Issues on Appeal

On appeal, the Appellant raised many grounds (about 35) including, but not limited to:

1. Whether the allegations of fraud and misrepresentation (on which Golden Lion based its case to challenge the appellant’s title) were properly proved.
2. Whether the appellant had indefeasible title under Section 26(1)(a) of the Land Registration Act.
3. Whether Golden Lion had shown good root of title and was a bona fide purchaser.
4. Whether Golden Lion had done due diligence before acquisition.
5. Whether the court was correct in finding the charge in favour of the 6th respondent invalid.
6. Allegations of procedural unfairness: e.g. late service of submissions, lack of hearing on some submissions. 
7. Whether the ELC erred in finding that Frank Logistics’ title was acquired illegally and unprocedurally.
8. Whether the ELC erred in cancelling the appellant’s certificate of title.
9. Whether the appellant had indefeasible title under the Land Registration Act, 2012.
10. Whether the respondents had proved fraud, illegality, or misrepresentation. 

Decision of the Court of Appeal

• The Court of Appeal dismissed the appeal.
• The Court upheld the findings of the Environment and Land Court: that Golden Lion was the valid proprietor; that the title in favour of Frank Logistics was irregular, unprocedural, illegal and thus cancellable under Section 26(1)(b) of the Land Registration Act, 2012.
• The Court found that Golden Lion had proved its title, root of title, and that the conveyance to it and registration were valid.
• The Court affirmed that even in the absence of proven fraud, titles may be challenged on the basis of “illegal, unprocedural or corrupt scheme” under section 26(1)(b). The appellant’s title was lost for being unprocedural, among other defects.
• The cross-appeals by the 6th and 7th respondents were also dismissed.
• Orders made: permanent injunctions, declarations of nullity for the transfer and charge to Frank Logistics and the 6th respondent; mandatory cancellation of the title in appellant’s name; eviction/delivery of vacant possession to Golden Lion; costs awarded to Golden Lion.

Outcome / Relief

• The Court of Appeal dismissed Frank Logistics’ appeal, upholding the lower court’s judgment in full.
• Golden Lion Real Estate Company declared lawful registered owner of LR No. 1/835 (Original 1/225/5).
• All dealings, transfer, charge in favor of Frank Logistics or the 6th respondent declared illegal and void.
• Mandatory injunction ordering cancellation of the title in the appellant’s name.
• Appellant ordered to vacate and deliver vacant possession; eviction if necessary.
• Golden Lion awarded costs.

  

Legal Principles Applied

a. Indefeasibility of Title

Under Section 26(1) of the LRA, 2012, a certificate of title is prima facie evidence of ownership. However, it can be challenged if it is:

• Obtained by fraud or misrepresentation;
• Acquired through an illegal, unprocedural, or corrupt scheme.

b. Root of Title

The Court stressed the importance of establishing a clear and lawful chain of title. Golden Lion successfully demonstrated a legitimate acquisition, whereas Frank Logistics failed to do so.

c. Transition Between Land Regimes

The case involved the transition from the Government Lands Act (GLA) and Registration of Titles Act (RTA) to the Land Registration Act. The Appellant failed to prove that it lawfully converted or registered title under the applicable regime.

d. Due Diligence in Land Transactions

The judgment underscored the duty of parties to conduct thorough investigations into the history, ownership, and court status of property before registration or charging.

e. Proof of Illegality vs. Fraud

The Court clarified that fraud need not be proven if a title was acquired through unlawful or procedurally defective means. In this case, inconsistencies in dates, registry entries, and transfer documentation were sufficient to invalidate the title.

f. Impact of Court Orders Not Registered

Even if a court order restraining dealings with land is not formally registered, parties with knowledge of the same must comply, and failure to do so may render transactions invalid.

Legal Principles

• Indefeasibility of Title (Section 26 of LRA, 2012): Title is not absolute if acquired through fraud, misrepresentation, or an illegal/unprocedural process.
• Root of Title: A party must demonstrate lawful acquisition through proper title history.
• Bona Fide Purchaser Doctrine: Does not apply where procedural irregularities or court orders are ignored.
• Priority of Registration does not validate an illegal process. 

Significance / Implications

• Reinforces that title, even if registered, is not absolutely bullet‐proof: procedural requirements and history (root of title, registration regime transitions, proper compliance with law) are crucial.
• Is a reminder that discrepancies in registry documents, delays in registration, mismatches in IR (instrument numbers), survey plan numbers, etc. can lead to nullification of otherwise impressive documents.
• The case clarifies that for acquisition of title under transitional periods (from old statutes to new ones), the manner of conversion or regime change must be properly shown.
• Emphasises importance for potential purchasers (and lenders) to do full due diligence (including search, checking registry records, reviewing prior court orders or injunctions, etc.).
• Also shows how even if a court order restraining dealings is not registered with the Lands Registrar, it may still impact the legality of subsequent transfers.