Shanzu Investments Ltd v Commissioner of Lands [1993] KECA 36 (KLR)
The bottom line
#Kenya's Court of Appeal restored a landowner's judgment for unpaid land acquisition compensation, ruling courts cannot set aside default judgments without a real defence.
What this practically means
#Executive summary
#Key legal issues
#Setting aside a regularly obtained ex-parte judgment under Order 9A rule 10
The appeal succeeded on setting aside: no defence on the merits existed and no useful purpose would be served by setting aside the judgment
The tests are whether there is a defence on the merits, prejudice, and explanation for delay. The respondent conceded liability for the principal sum, contesting only the rate of interest, so there was no triable issue. The Judge therefore erred in setting aside the judgment, and more so in raising irregular service of summons sua sponte when no party had pleaded it.
Scope of the power of review under Section 80 of the Civil Procedure Act and Order 44
There were sound grounds to review the judgment for 'any other sufficient reason' and vary the interest awarded; the appellate court, under Section 3(2) of the Appellate Jurisdiction Act, would do the same
Sadar Mohamed v Charan Singh held the discretion on review unfettered; Yusuf v Nokrach required reasons analogous to the rule's grounds; Wangechi Kimita rejected the analogy restriction as a clog on the unfettered s.80 right. The current position is that the court may review for any sufficient reason.
Rate of interest on unpaid land acquisition compensation
The 24% commercial rate was excessive; interest should run at six per cent per annum from taking possession to filing suit, and at court rates thereafter
Before amendment by Act No. 6 of 1990, Section 16(1) of the Land Acquisition Act mandated six per cent interest where compensation was unpaid at taking of possession; the amendment prescribed 'such rate as may be prescribed' but no rate has been prescribed, rendering it of no useful consequence. The 24% rate contravened Section 26 of the Civil Procedure Act.
Legal principles established
#- The court has unfettered discretion to review its own decrees or orders for any sufficient reason; 'any other sufficient reason' under Order 44 Rule 1 need not be analogous to the other enumerated grounds
- A regularly obtained ex-parte judgment will not be set aside unless there is a defence on the merits raising a triable issue
- The discretion under Order 9A rule 10 to set aside or vary judgment is very wide, subject only to the requirement that any variation be on just terms
Court orders
#- 1.Appeal allowed
- 2.Order setting aside the judgment set aside
- 3.Judgment for the appellant against the respondent restored in the principal sum of Shs 10,888,200.00 with interest at six per cent per annum from the date of taking possession until the date of filing suit, and thereafter at court rates until payment in full
- 4.Costs of the appeal awarded to the appellant
- On appeal from
- High Court of Kenya at Nairobi
- Jurisdiction invoked
- First appellate jurisdiction under the Appellate Jurisdiction Act, Cap 9 (including Section 3(2))
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (2)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Mereng & another v Mereng (Environment and Land Appeal E003 of 2023) [2025] KEELC 8254 (KLR)[2025] KEELC 8254 (KLR)26 Nov 2025applied
- Peris Wanjira Muriithi v Thomas Ndwiga Njogu & 6 others[2025] KECA 1426 (KLR)31 Jul 2025
Cite this brief
#Cite this brief
Caselaw, "Shanzu Investments Ltd v Commissioner of Lands [1993] KECA 36 (KLR)", Case Analysis (1993). Court of Appeal, Civil Appeal (number not stated in judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/1993/36/eng@1993-11-19
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.