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ELCDismissedNot stated in the extract· [2015] KEELC 348 (KLR)

Botwa Farm Co. Ltd v Settlement Fund Trustee & another [2015] KEELC 348 (KLR)

Environment and Land Court (High Court, Kitale)
30 June 2015
EOE. Obaga
908 words in judgment
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The bottom line

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A Kenyan court dismissed a land-buying company's claim because it never paid the full purchase price, so its land allocation was lawfully cancelled.

What this practically means

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Executive summary

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The plaintiff, a land-buying company incorporated in 1972 to buy land for settlement of its members, was allocated 1,024 acres of L.R. No. 6109 by the Settlement Fund Trustee at a purchase price of Kshs.2,000,000/=. It paid a 10% deposit of Kshs.200,000/= and, in 1980, subdivided the farm among its 169 shareholders, with land set aside for public utilities. Following internal wrangles in 1991, the company obtained a High Court ruling in Eldoret Civil Case No. 49 of 1991 against a tribal-line subdivision. In 1993 the District Land Adjudication and Settlement Officer demanded the balance of Kshs.3,999,276.65 plus accrued interest; the company did not pay, and in February 1995 the Director of Land Adjudication and Settlement cancelled the allocation. The settlement office re-subdivided the land, allocated it to new members who obtained titles, and declined the company's single attempted payment of Kshs.150,000/= in 1994. The company sued for declarations invalidating the repossession, affirming the 1980 subdivision, evictions of new allottees, an injunction and rectification of the register. The defendants filed documents but called no evidence. The court held that the plaintiff breached the conditions of the letter of allotment by failing to pay the balance for sixteen years, that the allegations of sabotage by a Settlement Officer and District Commissioner were unsubstantiated, and that the new title holders who met the Trustees' conditions hold valid titles that cannot be cancelled. The suit was dismissed with costs to the defendants on 30 June 2015 (E. Obaga, Judge).

Key legal issues

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01

Effect of failure to pay the balance of the purchase price under a letter of allotment

Holding

The plaintiff's failure to pay the balance beyond the 10% deposit entitled the Settlement authorities to cancel the allocation and repossess the land

Reasoning

The land was offered on condition of a 10% deposit and payment of the balance. Only the deposit was paid. A demand for Kshs.3,999,276.65 plus interest in 1993 went unpaid, and the 1995 cancellation followed. The single attempted payment of Kshs.150,000/= in 1994 was insufficient. The cancellation was therefore lawful, and the suit failed.

p. 2
02

Whether the defendants' refusal to accept payment invalidated the repossession

Holding

No - the allegation that the plaintiff was prevented from paying was misplaced and unsubstantiated

Reasoning

The plaintiff blamed a former Settlement Officer and a District Commissioner of allegedly bringing in Nandi members, but these claims were unsubstantiated. The plaintiff had sixteen years to clear the balance and did not. Its cheque of Kshs.150,000/= in 1994 was of a token amount. Refusal to accept it did not render the cancellation unlawful.

p. 2
03

Validity of titles issued to new allottees

Holding

The new allottees met the conditions set by the Settlement Fund Trustees and their titles cannot be cancelled

Reasoning

After cancellation, the land was allocated afresh to persons who met the conditions of the Settlement Fund Trustees and obtained titles. Since the original cancellation was lawful, the subsequent allocations were valid and no rectification of the register or cancellation of titles could issue against the new title holders.

p. 2

Legal principles established

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  • A party cannot claim land for which it has not paid; failure to meet allotment conditions justifies cancellation of the allocation
  • Titles lawfully obtained by allottees who met the conditions set by the Settlement Fund Trustees cannot be cancelled

Court orders

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  1. 1.The suit is dismissed
  2. 2.Costs of the suit awarded to the defendants

Authorities

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Cases cited (1)

  • Eldoret High Court Civil Case No. 49 of 1991
Jurisdiction invoked
Original civil suit (declarations, eviction, injunction and rectification of register) before the High Court at Kitale; specific provision not stated in the extract

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (6)

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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, "Botwa Farm Co. Ltd v Settlement Fund Trustee & another [2015] KEELC 348 (KLR)", Case Analysis (2015). Not stated in the extract. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2015/348/eng@2015-06-30

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