Nabro Properties Ltd v Sky Structures Ltd & 2 Others
The bottom line
#The Court of Appeal refused to force a land sale because the buyer delayed, signed a new deal, and couldn't prove it had the money.
What this practically means
#Executive summary
#Key legal issues
#Whether the 19 December 1992 agreement survived the completion date of 31 March 1993
The agreement was impossible to perform because the vendor had not obtained the 'perfect assignment' from the City Commission by the completion date, and it was rescinded by the purchaser's execution of the June 1994 assignment which created a new and inconsistent contractual obligation
The special condition requiring the vendor to procure a valid and perfect assignment was fundamental; it was fulfilled only after the completion date. The purchaser then executed a fresh assignment with a different interest and lower price, which was inconsistent with the old agreement and amounted to rescission, so no rescission notice was necessary and the old agreement no longer vested any cause of action.
Entitlement to specific performance
Specific performance was refused: the agreement could not sustain the claim, the purchaser was guilty of laches and inordinate delay, and it failed to prove it was ready, willing and able to perform
Equity aids the vigilant. The purchaser did not come to court until April 1995 despite knowing of problems since 1994, made only a mere statement of readiness to pay without evidence of funds, and could not show reciprocity since it had signed a new assignment with new arrangements.
Whether the 3rd respondent was a bona fide purchaser for value without notice
Yes. Fraud was not pleaded with particularity and was not proved; the 3rd respondent's title acquired bona fide and for value without notice of any defect could not be disturbed
Allegations of collusion based on a business relationship and a lower price were mere allegations requiring more proof; a reduced price depends on market conditions; the caveat had been removed before the transfer and the trial judge could not be faulted in finding the 3rd respondent a bona fide purchaser.
Proper execution of a company contract
Owuor JA disagreed with the trial judge on this point: a person dealing with a company is not bound to make enquiries into internal execution formalities and was entitled to assume the agreement was properly executed
Section 34 of the Companies Act provides how company contracts are executed and they need not be under seal; it is an elementary tenet of company law that an outsider dealing with a company need not enquire into internal compliance with the Memorandum and Articles.
Legal principles established
#- A party seeking specific performance must show and satisfy the court that it is ready, willing and able to perform its part of the bargain
- Fraud must be specifically pleaded and particularised under Order VI rule 8 of the Civil Procedure Rules before it can be relied upon
- A caveat based on a lapsed agreement creates no registrable interest in land; acceptance of such a caveat does not create any interest
- Inordinate delay disqualifies a party from the equitable remedy of specific performance
- A reduced purchase price, by itself, is no evidence of fraud; the price at any time depends upon prevailing market conditions
Court orders
#- 1.Appeal dismissed
- 2.No order as to costs both in the Court of Appeal and in the court below
- On appeal from
- High Court of Kenya (Superior Court)
- HCCC No. 2994 of 1994 (OS)
- Jurisdiction invoked
- First appeal to the Court of Appeal from the Superior Court (High Court) in a civil suit
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.
- One Hundred and Two Peponi Road Llp & 1 other v National Environment Management Authority & 2 others[2026] KECA 1380 (KLR)10 Jul 2026
- Jimmy Nathan Sambo & 1 other v Lucy Mayanka Mwakio & 1 other[2025] KECA 913 (KLR)23 May 2025
Cite this brief
#Cite this brief
Caselaw, "Nabro Properties Ltd v Sky Structures Ltd & 2 Others", Case Analysis (2002). Civil Appeal (Nairobi). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2002/296/eng@2002-04-26
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.