“Once property is attached pursuant to a court decree, it is placed under the custody of the law (pignus judiciale). Any interference with, alteration of, or private alienation of that property without the Court’s leave is prohibited and may be considered void.” – Mativo & Gachoka JJ.A, KUDHEIHA v Tea Hotels Limited & Others, Civil Appeal Nos. NAK E023 & E028 of 2022, Court of Appeal at Nakuru, 8 May 2026.
What Happened
A workers’ union, KUDHEIHA, had spent years trying to recover unpaid wages from Tea Hotels Limited in Kericho. After the hotel repeatedly ignored court-approved payment plans, the court finally authorised the forced sale of the hotel’s land specifically, a plot known as Block 4/313. What followed was a cautionary tale about what happens when the rules governing such sales are treated as optional.
Instead of selling Block 4/313 as directed, the auctioneer sold a completely different and far more valuable plot Block 4/295, worth over Kshs 423 million. The explanation offered was that the parties had privately agreed to the swap. Four buyers paid Kshs 28 million at auction and later had the land registered in their names. The hotel owner went to court to have the sale reversed. The trial judge agreed, and the buyers and the union appealed. On 8 May 2026, the Court of Appeal dismissed both appeals.
The Core Principle: Attached Property Belongs to the Court, Not the Parties
The most important determination by the Court of Appeal said was that once a court orders that a piece of land be attached in execution of a judgment, that land is no longer freely available to the parties to deal with as they please. It passes into what the law calls the pignus judiciale literally, “a judicial pledge” or property in the custody of the law. Any sale, transfer, or other dealing with that land, without the court’s express permission, is void. It is as if the transaction never happened.
This principle is not new. It is embedded in Section 47 of the Civil Procedure Act, which says exactly this. But the KUDHEIHA judgment is a rare and detailed application of it to a real execution gone wrong, and it is worth every property practitioner’s attention.
What Went Wrong: Seven Steps, Seven Failures
The Court went through the execution process step by step and found serious failures at almost every stage:
- No valid decree was ever extracted. The space for the date of the decree on the execution application was blank. Without a decree, there was nothing to execute.
- The application for execution did not properly describe the property to be sold, as required by law.
- No prohibitory order was registered against the land at the Land Registry, the step that legally “locks” the property and makes the attachment effective.
- The auctioneer sold Block 4/295, a completely different property from Block 4/313, which was the only plot the court had authorised for sale.
- The newspaper advertisement did not comply with the prescribed legal form and gave the wrong venue and wrong size for the property.
- The alleged private treaty sale where the hotel offered the alternative plot informally was never approved by the court, as it must be.
- The notice given before the auction was 15 days, not the 45 days required by the Auctioneers Rules, 1997.
The Court was direct: “The execution process is governed by Order 22 which acts as a complete code for enforcing decrees. Sales held in non-conformity are illegal.”
Can’t the Buyers Rely on Their Registration?
The buyers argued they were innocent as they had paid their money, received a court certificate of sale, and had the property registered in their names. Surely, they said, registration gave them a safe, unchallengeable title?
The Court was of a different holding and stated that where a sale is fundamentally void not just irregular, but conducted without legal foundation no certificate of sale and no act of registration can save it. Buyers at court auctions take on a responsibility to look beyond the paperwork on the day and satisfy themselves that the underlying process was lawful.
What This Means in Practice
- If you are a decree-holder ensure a formal decree is extracted and served before instructing any auctioneer. An application for execution is not a decree.
- If you are an auctioneer always obtain and read the court order, confirm the property you are instructed to sell matches the order exactly, and do not proceed on the basis of private arrangements between parties.
- If you are a judgment debtor offering a different property that offer must go back to court for formal approval, with the full procedure restarted for the substitute property.
- If you are considering buying at a court-ordered auction do your own due diligence. Check that a valid decree was extracted, that the property being sold is the one authorised by the court, and that the mandatory notice and registration steps were followed.
The Bottom Line
A court-ordered auction is not a shortcut around the law. It is the law working in a structured, step-by-step way to protect both the person owed money and the person whose property is being sold. Skip the steps, and the whole exercise collapses. The KUDHEIHA judgment is a firm reminder that in property execution, process is everything.
This article is provided free of charge for information purposes only; it does not constitute legal advice and should be relied on as such. No responsibility for the accuracy and/or correctness of the information and commentary as set in the article should be held without seeking specific legal advice on the subject matter. If you have any query regarding the same, please do not hesitate to contact our Litigation Department vide litigation@wamaeallen.com
About the author
Caxstone specializes in civil, employment and labour disputes, constitutional law, family law and succession, and environment and land matters. He has amassed a wealth of knowledge and experience in litigation which is evident in the successes obtained for clients. He is an active member of the Employment and Labour Relations Court Bar-Bench committee.
Nadio George is a dedicated Advocate of the High Court of Kenya, passionate about legal excellence, societal progress, and environmental stewardship. Admitted to the Roll of Advocates in 2023, he combines deep legal expertise with a strong commitment to making meaningful contributions to both the legal profession and the community.
Denis Mutugi specializes in Commercial Litigation and Alternative Dispute Resolution.
Denis graduated with a Bachelor of Laws, LLB (Hons) from The University of Nairobi in 2021 and was admitted to the Roll of Advocates of the High Court of Kenya in the year 2023.
Denis has amassed a considerable wealth of experience in conducting legal research on various complex legal matters touching on Commercial, Insurance, Employment and Insolvency law and bankruptcy.
