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Court of AppealDismissedNot stated in the judgment· [1983] KECA 24 (KLR)

Kathleen Isabel Spiers v Njokerio Farmers Company Ltd [1983] KECA 24 (KLR)

Court of Appeal of Kenya
16 February 1983
2,281 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~9 min to read original · ~4 min brief

The bottom line

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Kenya's Court of Appeal ruled that public companies buying agricultural land need a Presidential exemption under the Land Control Act, with no time limit on applying.

What this practically means

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Executive summary

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This Court of Appeal decision concerned the effect of the Land Control Act (cap 302) on a 1976 agreement by which Mrs Kathleen Isabel Spiers sold 343 acres of agricultural land in Nakuru District to a public company, retaining the 'front land' subject to a first refusal in favour of the purchaser. Relying on its earlier decision in Nyakinyua and Kang'ei Farmers Company Limited v Kariuki and Gatheca Resources Limited, the court reiterated that a land control board is obliged under section 9(1)(c) to refuse consent to a disposal of agricultural land to a public company, leaving Presidential exemption under section 24 as the only route to legalise such a transaction. The executors, following a codicil in which Mrs Spiers declared the agreement void for want of consent or exemption, sued for a declaration that the agreement was void for all purposes, an injunction and eviction. The appeal raised whether an application for Presidential exemption had to be made within any specified time and, if not made, whether the contract became void. Potter JA, delivering the judgment of the court with which Madan and Law JJA agreed, resolved the apparent conflict between section 6(2)'s three-month time limit and section 24's unlimited power of exemption by holding that the time limits do not apply where a Presidential exemption must be and is obtained. The first refusal therefore remained valid, and the appeal was dismissed with costs to be paid out of the estate. The decision below was affirmed.

Key legal issues

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01

Whether the three-month time limit in section 6(2) of the Land Control Act applies to transactions that can only be regularised by Presidential exemption under section 24

Holding

It does not. Where the land control board is prohibited by law from giving consent, section 24 provides an exception from the general time limits, and the exemption may be sought and granted without time limitation.

Reasoning

The court identified an apparent conflict between section 6, which requires land control board consent within three months, and section 24, which empowers the President to exempt a controlled transaction without limitation of time. Reading section 6's time limit against a public company would produce the absurdity that the company was bound to apply for a consent the board was bound by law to refuse. The conflict is resolved by holding that section 6(2)'s time limits do not apply where a Presidential exemption must be and is obtained.

p. 4
02

Whether the agreement for sale of December 23, 1976, including the first refusal over the front land, remained valid in light of the Presidential exemption of September 25, 1979

Holding

The agreement, including the first refusal over the 34 acres of LR No. 6998 and LR 7448, remained a valid agreement to which the Act no longer applied by virtue of the exemption.

Reasoning

The exemption covered the proposed sale of LR Nos 6998, 7103/2 and 7448, the whole estate. Time was not of the essence under the agreement, no notice under condition 25 of the Law Society Conditions was given, and the respondent was not in default. Since the section 6(2) time limits did not apply, the agreement had not become void when the exemption was granted, so the first refusal remained enforceable.

p. 4

Legal principles established

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  • Where a land control board is prohibited by the Land Control Act from consenting to a sale of agricultural land to a public company, the three-month time limit in section 6(2) does not apply where a Presidential exemption under section 24 must be and is obtained; section 24 is an exception to the time limits for obtaining consent.
  • The only method open to a public company to legalise a disposal of agricultural land to it is to seek Presidential exemption under section 24 of the Act, since the land control board is under an absolute duty to refuse consent.
  • A Presidential exemption may be given at any time to a land transaction affected by the Act, without any time limit as to the making of the application or the granting of the exemption.

Court orders

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  1. 1.The appeal is dismissed
  2. 2.Costs to the respondent, to be paid out of the estate of the late Mrs Spiers
On appeal from
High Court of Kenya
Not stated in the judgment
Jurisdiction invoked
First appeal to the Court of Appeal (appeal from the decision of the High Court); specific provision not stated in the judgment

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Kathleen Isabel Spiers v Njokerio Farmers Company Ltd [1983] KECA 24 (KLR)", Case Analysis (1983). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/1983/24/eng@1983-02-16

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.