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ELCAllowedNot stated in judgment· [2018] KEELC 3856 (KLR)

Peter Mutuku Sila & another v Saminico Ltd [2018] KEELC 3856 (KLR)

Environment and Land Court
13 April 2018
2,011 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Machakos court cancelled a land sale because the buyer never paid the balance, and ordered the land registered back to the sellers' family.

What this practically means

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Executive summary

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The Plaintiffs sued over land known as Matungulu/Sengani/3470, a 20-acre portion excised from Matungulu/Sengani/1311, which the Defendant purchased for Kshs. 8,000,000 under an agreement of 27th March, 2008. The Plaintiffs claimed the Defendant breached the agreement by failing to pay the balance of the purchase price despite the land having been registered in the Defendant's name, and sought nullification of the agreement and transfer. The Defendant, whose land was sub-divided into over 160 plots and largely sold to third parties, admitted owing Kshs. 5,500,000 at the time of filing suit but asserted it was entitled to sell plots before settling the balance; it also objected that the 2nd Plaintiff lacked letters of administration to sue on behalf of his late father's estate. The court rejected the locus standi objection, reasoning that the Defendant having contracted with the 2nd Plaintiff could not question his capacity, as that would equally invalidate the agreement under which the Defendant derived title. On the merits, the court found that registration and sub-division implied the Land Control Board consent required for payment of the balance had been obtained, yet the balance remained unpaid. The court therefore held the Defendant in breach of the sale agreement, allowed the Amended Plaint, nullified the sale agreement and the transfer registered on 20th May, 2008, ordered rectification of the register and issuance of a title in the name of Michael Mutiso Sila (deceased), and awarded the Plaintiffs costs.

Key legal issues

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01

Locus standi of the 2nd Plaintiff

Holding

The objection fails; having signed the agreement on behalf of the family, the 2nd Plaintiff (with the 1st Plaintiff) is the proper party to seek nullification

Reasoning

The Defendant contracted with the Plaintiffs and cannot retrospectively question the 2nd Plaintiff's capacity. If the 2nd Plaintiff lacked letters of administration, he equally lacked capacity to sign the 2008 agreement, which would undermine the Defendant's own acquisition. Only the parties to the agreement can seek its nullification.

p. 3
02

Breach of the Sale Agreement

Holding

The Defendant breached the agreement by failing to pay the balance of the purchase price before transferring the land and selling sub-plots to third parties

Reasoning

The agreement provided the balance was payable once Land Control Board consent was granted. Registration of the land in the Defendant's name and subsequent sub-division and sale of over 100 plots implied the consents were obtained. Despite this, the Defendant conceded owing Kshs. 5,500,000 at filing of suit, breaching the payment obligation.

p. 3

Legal principles established

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  • A party to a sale agreement cannot challenge the locus standi of the counterparty who signed it, as that would equally invalidate the agreement benefiting the party
  • Where the agreement required payment of the balance upon Land Control Board consent, registration implies consent had been obtained, and the buyer was bound to pay before transferring and selling to third parties

Court orders

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  1. 1.An order nullifying the Sale Agreement dated 27th March, 2008 and the Transfer registered on 20th May, 2008 in respect of Matungulu/Sengani/3470 in favour of the Defendant
  2. 2.The register in respect of Matungulu/Sengani/3470 and any subsequent sub-divisions to be rectified by deleting the Defendant's name and all subsequent registered owners, with Michael Mutiso Sila (deceased) registered as proprietor
  3. 3.The Land Registrar to issue a Title Deed for Matungulu/Sengani/3470 in the name of Michael Mutiso Sila (deceased)
  4. 4.The Defendant to pay the costs of the suit
Jurisdiction invoked
Not expressly stated; first-instance suit on land sale agreement

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, "Peter Mutuku Sila & another v Saminico Ltd [2018] KEELC 3856 (KLR)", Case Analysis (2018). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2018/3856/eng@2018-04-13

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