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Court of AppealPartially AllowedCivil Appeal No. 146 of 2009· [2015] KECA 368 (KLR)

Daniel Migwi Njai v High View Farm Limited & another [2015] KECA 368 (KLR)

Court of Appeal of Kenya
2 October 2015
2,524 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Court of Appeal ruled a buyer who delayed paying a property's purchase balance owed the seller interest, but could not cancel the transfer itself.

What this practically means

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Executive summary

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This appeal arose from a 1985 agreement for sale of LR No. 11453/1 Thika between the appellant vendor and the 1st respondent purchaser. The High Court (Bhandari, J) decreed specific performance in 1988, and the Court of Appeal dismissed the vendor's appeal in Civil Appeal No. 139 of 1989. The vendor refused to execute the transfer, leading to an order allowing the Deputy Registrar to execute it; the 1st respondent was registered as proprietor on 10th April 2006, though the balance of the purchase price (Kshs.1,575,000/=) was not paid until 30th October 2008. The vendor then applied to the High Court (Osiemo, J) to cancel the transfer as irregular, but the judge dismissed the application, holding he had no jurisdiction to interfere with the decree. The vendor appealed to the Court of Appeal, seeking cancellation of the transfer or, alternatively, interest at bank rates on the purchase price from 19th February 1985. The Court held the judge erred in failing to distinguish two issues: cancellation of title, on which he correctly had no jurisdiction because the Court of Appeal's decision bound him under stare decisis, and validity of execution of the decree, on which Section 34(1) of the Civil Procedure Act conferred jurisdiction. The Court declined to disturb the decree for specific performance, holding it has no jurisdiction to recall or rescind its own decision. However, it found the respondents liable to pay interest at court rates on the balance of the purchase price from the date of transfer until payment. The appeal was allowed in part, the ruling of 9th October 2008 was set aside in its entirety, and the respondents were ordered to pay interest and costs in both courts.

Key legal issues

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01

Jurisdiction of the High Court over applications arising from execution of a decree

Holding

The learned judge erred in failing to distinguish two issues before him: cancellation of title (on which he correctly lacked jurisdiction, being bound by the Court of Appeal decision) and validity of the mode of execution (on which he had jurisdiction under Section 34(1) of the Civil Procedure Act)

Reasoning

The Court examined Section 34(1) of the Civil Procedure Act which vests in the court executing a decree all questions between the parties relating to execution, discharge or satisfaction of the decree. The judge wrongly treated the whole application as an attempt to reopen the Court of Appeal's decision. He correctly had no jurisdiction over cancellation of the respondents' title because the decree for specific performance had been upheld on appeal, and the doctrine of precedence and stare decisis bound him. But the question whether the decree was validly executed fell squarely within Section 34(1) and should have been determined on the merits.

p. 4
02

Whether a party may obtain cancellation of a title transferred pursuant to a decree upheld on appeal

Holding

No. The Court cannot sit on appeal against its own decision, and the transfer and registration were made pursuant to the order and decree of specific performance

Reasoning

The Court endorsed Rafiki Enterprises Limited v Kingsway Tyres & Automart Limited that the Court of Appeal has no jurisdiction to recall, nullify, vary or rescind its own decision. The decree for specific performance had been heard and determined in Civil Appeal No. 139 of 1989 between the same parties. The judge was therefore bound by that decision on the question of cancellation of title, and this Court likewise could not disturb the decree.

p. 4
03

Interest on the unpaid balance of the purchase price

Holding

The respondents were liable to pay interest at court rates on the balance of Kshs.1,575,000/= from the date of transfer (10th April 2006) until payment on 30th October 2008, but not from 1985

Reasoning

The decree required the respondents to tender the balance of the purchase price upon transfer. The balance was paid only on 30th October 2008, over two years after transfer on 10th April 2006. The explanation of the 2nd respondent's stroke was no excuse given the respondents' possession since 1985. Interest was not payable from 1985 because during that period the appellant himself declined to perform the contract and execute the instruments of transfer, and the balance was not due and payable until the property was transferred.

p. 4

Legal principles established

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  • All questions arising between parties to a suit relating to the execution, discharge or satisfaction of a decree shall be determined by the court executing the decree and not by separate suit
  • The Court of Appeal has no jurisdiction to recall, nullify, vary or rescind its own decision; a lower court is bound by the Court of Appeal's prior decision under the doctrine of precedence and stare decisis
  • A transferee under a decree for specific performance who takes possession and receives the transfer but delays tendering the balance of the purchase price is liable to pay interest on the balance from the date of transfer

Court orders

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  1. 1.The ruling of the High Court (Osiemo, J) dated 9th October 2008 is set aside in its entirety
  2. 2.Substituted in its place an order that the respondents shall pay interest at court rates to the appellant on the sum of Kshs.1,575,000/= from 10th April 2006 till 30th October 2008
  3. 3.The respondents shall pay costs in the High Court and costs in this appeal
  4. 4.Further interest on the decretal amount from the date of filing suit until payment in full

Authorities

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Legislation

  • Civil Procedure ActSection 34(1)

Cases cited (1)

  • Rafiki Enterprises Limited -v- Kingsway Tyres & Automart Limited
    Civil Application No. NAI 375 of 1996
On appeal from
High Court of Kenya at Nairobi
H.C.C.C No. 4060 of 1985
Jurisdiction invoked
First appeal to the Court of Appeal against a ruling of the High Court (Constitution and Court of Appeal appellate jurisdiction); the judgment itself does not state the specific provision

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (5)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Daniel Migwi Njai v High View Farm Limited & another [2015] KECA 368 (KLR)", Case Analysis (2015). Civil Appeal No. 146 of 2009. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2015/368/eng@2015-10-02

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