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ELCDismissedNot stated in the judgment as provided· [2014] KEELC 610 (KLR)

Armstrong Fred Kasuku v James Charles Nakhwanga Osogo & 2 others [2014] KEELC 610 (KLR)

Environment and Land Court
8 August 2014
JMJ. M. Mutungi
5,421 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~22 min to read original · ~4 min brief

The bottom line

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A Kenyan land buyer lost his bid to block apartment sales because his property deal wasn't in a properly signed written contract.

What this practically means

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Executive summary

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This interlocutory ruling of the Environment and Land Court at Nairobi, delivered by J. M. Mutungi J on 8th August 2014, determines two competing applications arising from a dispute over L.R. No. 1/390 Nairobi. The plaintiff claimed that in consideration of his paying off a National Bank of Kenya debt of about Kshs.4.5 million, the 1st and 2nd Defendants agreed by an agreement dated 7th November 2009 to transfer a quarter-acre portion of the property to him; the property was instead transferred to the 3rd Defendant, who developed apartments on it. The plaintiff sought an injunction restraining the transfer or encumbrance of six apartments. The 1st and 2nd Defendants opposed and, relying on a later unexecuted pledge agreement, sought an order wholly compromising the suit against them on terms including transfer of one two-bedroom apartment and judgment for Kshs.835,208/90 or a figure verified by a commission to an authorised bank officer. The court held the plaintiff had not established a prima facie case with probability of success: the 2009 agreement could not be specifically enforced, the plaintiff had no privity with the 3rd Defendant, and any disposition of an interest in land required a written contract under section 3(3) of the Law of Contract Act. No fraud was substantiated, and damages would be an adequate remedy since the apartments were not unique. The plaintiff's motion was dismissed. The 1st and 2nd Defendants' application was also disallowed, the court declining to enforce an unsigned pledge agreement or to issue a commission, holding that evidence of payments should be tendered at trial. Each party was directed to bear its own costs of the applications.

Key legal issues

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01

Whether the plaintiff established a prima facie case with a probability of success for an interlocutory injunction

Holding

The plaintiff failed to establish a prima facie case; the agreement of 7th November 2009 could not be specifically enforced, and no fraud by the 1st and 2nd Defendants was substantiated.

Reasoning

The 7th November 2009 agreement did not relate to the six apartments claimed, the 1st and 2nd Defendants own no identified apartments, and the registered owner is the 3rd Defendant. The plaintiff has no privity of contract with the 3rd Defendant and no written contract complying with section 3(3) of the Law of Contract Act. Allegations of fraud were unsupported, the plaintiff having participated in family meetings and settlement negotiations.

p. 7
02

Whether damages would be an adequate remedy

Holding

Damages would be an adequate remedy because the apartments can be quantified and equivalent ones obtained in the market.

Reasoning

The plaintiff did not show the apartments were special or unique; their value once ready can be quantified and he could be paid equivalent value at the conclusion of the trial. Having failed on the prima facie case limb and adequacy of damages, the court did not consider the balance of convenience.

p. 7
03

Whether the suit against the 1st and 2nd Defendants was compromised

Holding

The court declined to find a binding compromise since the pledge agreement relied on was never executed; the issue was left for trial.

Reasoning

The 1st and 2nd Defendants sought to rely on an unsigned pledge agreement allocating one apartment to the plaintiff and reimbursing documented payments of Kshs.835,208/90. Because the agreement was unexecuted, the plaintiff could not be held bound by its terms, and the dispute over amounts paid remains a matter for trial.

p. 8
04

Whether the court should issue a Commission to investigate payments made to the National Bank of Kenya

Holding

The request for a commission was refused as inappropriate at the interlocutory stage.

Reasoning

Parties must prove their cases by evidence; a bank officer can be called as a witness at trial, available for cross-examination, and certified statements of account are receivable in evidence. A commission would deny the parties the opportunity to test the evidence.

p. 9

Legal principles established

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  • An agreement for the disposition of an interest in land that does not comply with section 3(3) of the Law of Contract Act cannot be the basis of a suit.
  • A party alleging payment bears the duty to tender evidence of payment; a commission is inappropriate where witnesses can be called and cross-examined at trial.
  • Attachment before judgment under Order 38 rule 5 must not be exercised lightly and requires clear proof that the defendant is about to dispose of property to obstruct or delay execution.

Court orders

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  1. 1.The plaintiff's amended Notice of Motion dated 14th February 2014 seeking injunctive reliefs is dismissed for lack of merit
  2. 2.The 1st and 2nd Defendants' Notice of Motion dated 7th February 2014 is disallowed; the request for a Commission to an authorised officer of the National Bank of Kenya is declined
  3. 3.Each party will meet their own costs of the applications

Authorities

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Legislation

  • Law of Contract Act, Cap 23 Laws of Kenyasection 3, section 3(3)
  • Civil Procedure RulesOrder 28 Rule 7
  • Civil Procedure RulesOrder 38 rule 5

Cases cited (5)

  • Kuria Kanyoko t/a Amigos Bar and Restaurant –vs- Francis Kinuthia Nderu & others
    (1988) 2 KAR 126
  • Silverbird Kenya Ltd –vs- Junction Limited and 3 others
    (2013) eKLR
  • Kangatta Properties Co. Ltd –vs- Charity Njeri T/A Winacom Crossline Supplies & 4 others
    ELC HCCC No. 1222 of 2013
  • Kenya Anticorruption Commission –vs- Kimumu Service Station & 2 others
    ELC HCCC No. 1204 of 2006
  • GIELLA –vs- CASSMAN BROWN CO. LTD
    (1973) EA 358
Jurisdiction invoked
Original civil jurisdiction of the Environment and Land Court over the suit property L.R. No. 1/390 Nairobi; interlocutory applications under the Civil Procedure Rules (Order 28 Rule 7) and the Law of Contract Act

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, "Armstrong Fred Kasuku v James Charles Nakhwanga Osogo & 2 others [2014] KEELC 610 (KLR)", Case Analysis (2014). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2014/610/eng@2014-08-08

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