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Court of AppealPartially AllowedCivil Appeal 134 of 2017· [2022] KECA 583 (KLR)

George Chayuga Aliaza v Zephania Khisa Saul

Court of Appeal
24 June 2022
KMK M'InotiPKPO KiageMNMumbi Ngugi
7,013 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 that a land seller who takes full payment but refuses to apply for Land Control Board consent cannot use that omission to cancel the sale.

What this practically means

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Executive summary

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The appellant purchased 1.3 acres out of Kakamega/Mabusi/416 from the respondent under agreements dated 16th September 2002 and 4th October 2004, paid the full purchase price of Kshs 217,000, and was placed in possession, developing the land. No Land Control Board consent was obtained because the respondent did not apply for one. The Environment and Land Court (Obaga, J) held the transactions void for want of consent, ordered the appellant to vacate, and refunded the purchase price with interest, each party bearing its own costs. The appellant appealed. Ngugi JA, writing the principal judgment with which Kiage JA and M'Inoti JA concurred, acknowledged conflicting Court of Appeal authority on the effect of missing Land Control Board consent - David Ole Tukai versus Macharia Mwangi Maina - and preferred the Macharia Mwangi Maina, Sigei and Kiplagat Kotut line, noting that the Sixth Schedule constitutional provisions had not been considered in Ole Tukai. The court held that where a vendor receives the full price and gives possession but himself declines to apply for consent, consent has not been 'refused' under section 9(2); a constructive trust arises in favour of the purchaser as an overriding interest, and the transaction is not void. The Land Control Act must be read through Article 10 and section 7 of the Sixth Schedule so as not to aid a vendor seeking to renege. The court also held it could determine the unpleaded constructive trust issue. The appeal was allowed: the trial court's orders were set aside, specific performance and transfer of the suit land were ordered, and the appellant received costs in both courts. The claim for improvements of Kshs 3.4 million failed on the finding that the parcel on which improvements stood was unclear.

Key legal issues

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01

Effect of failure to obtain Land Control Board consent where the vendor caused the failure

Holding

The transaction is not void where the vendor received full payment, gave possession, and himself declined to apply for consent; a constructive trust in favour of the purchaser arises and is an overriding interest.

Reasoning

The court distinguished refusal of consent by the Board on public-policy grounds from a seller's own failure or refusal to apply. Since both seller and purchaser must sign the consent application, a seller who withholds his signature cannot invoke section 9(2). Reading the Act through section 7 of the Sixth Schedule and Article 10, equity prevents the vendor from using the statute to resile and unjustly enrich himself.

p. 10
02

Conflict in Court of Appeal jurisprudence on Land Control Board consent

Holding

The court acknowledged conflicting lines of authority (Ole Tukai versus Macharia Mwangi Maina) and preferred the Macharia Mwangi Maina, Sigei and Kiplagat Kotut line, noting the Sixth Schedule constitutional provisions were not considered in Ole Tukai.

Reasoning

The court recognised there is no consensus on the effect of failure to obtain consent. It adopted the reasoning of Macharia Mwangi Maina, William Kipsoi Sigei and Kiplagat Kotut as best capturing the spirit of the Land Control Act interpreted through the Constitution, distinguishing Ole Tukai on the basis that the Sixth Schedule provisions were not cited there.

03

Unpleaded constructive trust

Holding

The court could infer a constructive trust although not pleaded in the counterclaim, since the issue was raised in submissions and left for the trial court's determination.

Reasoning

Relying on Odd Jobs v Mubia and Ann Wairimu Wanjohi, the court held that an issue arising from the evidence and canvassed in submissions may be determined even if not pleaded. The trial court had in fact addressed the constructive trust issue but erred in rejecting it on the basis of uncertainty as to the parcel, when the evidence showed no dispute as to identity of the suit property.

p. 11
04

Claim for cost of improvements

Holding

The claim for improvements valued at Kshs 3.4 million failed because it was not clear on which parcel the improvements stood.

Reasoning

The trial court found the agreements did not identify the plot from which the 1.3 acres was excised and the appellant's evidence on the location of the improvements was contradictory. The appellate court agreed with that finding, so no special damages for improvements were awarded.

Legal principles established

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  • Where a vendor of agricultural land receives the full purchase price and gives the purchaser possession but himself fails or refuses to apply for Land Control Board consent, a constructive trust arises in favour of the purchaser and becomes an overriding interest; the failure to obtain consent does not render the transaction void.
  • Consent is not 'refused' within section 9(2) of the Land Control Act where the seller simply declines to apply; the Board must have had an opportunity to consider the application.
  • The Land Control Act must be read through section 7 of the Sixth Schedule to the Constitution and Article 10 so as not to aid a vendor who reneges on contractual obligations.
  • A court may determine an unpleaded issue of implied or constructive trust where it arises from the evidence and was left for determination by the trial court.

Court orders

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  1. 1.Appeal allowed
  2. 2.Orders of the trial court set aside
  3. 3.Specific performance of the agreements for sale dated 16th September 2002 and 4th October 2004 as prayed in the appellant's counterclaim
  4. 4.Transfer of the suit land to the appellant
  5. 5.Costs of the suit in the Court of Appeal and in the trial court granted to the appellant

Authorities

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Legislation

  • Land Control Actsection 6
  • Land Control Actsection 7
  • Land Control Actsection 8
  • Land Control Actsection 9(2)
  • Land Control Actsection 11
  • Land Control Actsection 13
  • Land Control Actsection 22
  • Land Control Regulations, 1967Form 1 in the Schedule
  • Land Registration Actsections 36 and 66
  • Registered Land Act (repealed)section 126(1)
  • Registered Land Act (repealed)section 163
  • Judicature Actsection 3
  • Constitution of Kenya, 2010Article 10
  • Constitution of Kenya, 2010section 7, Sixth Schedule (Transitional and Consequential Provisions)

Cases cited (15)

  • Selle v Associated Motor Boat Co. Limited
    (1968) EA 123

    Duties of a first appellate court to re-evaluate evidence and draw its own conclusions

  • Macharia Mwangi Maina & 87 others v Davidson Mwangi Kagiri
    (2014) eKLR

    Purchaser in possession has overriding interest; constructive trust enforceable despite lack of Land Control Board consent

  • Mwangi & another v Mwangi
    (1986) KLR 328

    Rights of a person in possession are equitable rights binding on the land

  • Mutsonga v Nyati
    (1984) KLR 425

    Equitable doctrines of implied, constructive and resulting trusts apply to registered land

  • Kanyi v Muthiora
    (1984) KLR 712

    Equitable doctrines of trusts apply to registered land via section 163 of the Registered Land Act

  • Yaxley v Gotts & Another
    (2000) Ch 162

    Oral agreement for sale of property may be enforceable via constructive trust or proprietary estoppel

  • Chase International Investment Corporation and Another v Laxman Keshra and Others
    [1978] KLR 143; [1976-80] 1 KLR 891

    Equity in favour of a plaintiff with a known equity entitles him to succeed

  • David Ole Tukai v Francis Arap Muge & 2 Others
    [2014] eKLR

    No room to import equitable doctrines into the Land Control Act; contrasting authority

  • Willy Kimutai Kitilit v Michael Kibet
    [2018] eKLR

    Section 6(2) does not bar courts from declaring a constructive trust; equity is law

  • William Kipsoi Sigei v Kipkoech Arusei & another
    [2019] eKLR

    Constructive trust and proprietary estoppel enforceable in regard to land subject to the Land Control Act

  • Kiplagat Kotut v Rose Jebor Kipngok
    [2019] eKLR

    Land Control Act not an instrument for unjust enrichment; constructive trust prevents unconscionable conduct

  • Gabriel Makokha Wamukota v Sylvester Nyongesa Donati
    [1987] eKLR

    A vendor should not be allowed to use the Land Control Act as a vehicle for fraud

  • Rioki Estate Co (1970) Ltd v K Njoroge
    [1977] KLR 146

    Binding precedent that transactions without Land Control Board consent are void; criticised by Apaloo JA

  • Odd Jobs v Mubia
    [1970] EA 476

    A court may act on an unpleaded issue if it arises from the evidence

  • Ann Wairimu Wanjohi v James Wambiru Mukabi
    [2021] eKLR

    Unpleaded issue of implied or constructive trust may be determined where left to the court

On appeal from
Environment and Land Court at Kitale
Environment and Land Case No. 47 of 2012
Jurisdiction invoked
First appeal to the Court of Appeal under the Court of Appeal's appellate jurisdiction (Constitution Article 164); appeal from the Environment and Land Court

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (8)

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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, "George Chayuga Aliaza v Zephania Khisa Saul", Case Analysis (2022). Civil Appeal 134 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2022/583/eng@2022-06-24

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