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ELCDismissedELC Case No. 6 of 2018 (formerly Nairobi ELC Case No. 930 of 2015)· [2019] KEELC 1357 (KLR)

James Njogu Mungai v Francis Kitungo Mutisya [2019] KEELC 1357 (KLR)

Environment & Land Court
14 October 2019
MGMbogo C. G.
2,688 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan land buyer who failed to pay within the agreed 90 days lost everything because courts won't help a buyer who breached the contract first.

What this practically means

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Executive summary

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The Plaintiff sued the Defendant for a permanent injunction, specific performance, and general damages arising from a sale agreement dated 12th September 2008 over plot No. 94 Kiboko 'B' Settlement Scheme, purchased at Kshs.212,951/=. The Plaintiff paid a deposit of Kshs.174,193/= and took the original allotment letter, but the agreement (clause 4) fixed completion at 90 days, time being of the essence, with the balance of Kshs.38,758/= payable on completion. The Plaintiff admitted the balance was never paid within the completion period, and his advocate's demand letter was written only in January 2014, some six years later. The Defendant, who had acquired the land by letter of offer dated 30th June 1999 and acceptance dated 11th February 2002, denied the claim, contended the Plaintiff was in breach, and averred that after attempting in vain to refund the deposit he sold the land to Lochab Transport Ltd in October 2014. At trial, each party adopted statements and produced exhibits. The Defendant's counsel relied on authorities on injunctions and the discretionary nature of specific performance, including Reliable Electrical Engineers Ltd vs Mantrac Kenya Ltd. The court held that the Plaintiff's failure to pay the balance within the 90-day completion period was a breach entitling the Defendant to terminate; that a party in breach cannot claim equitable remedies; and that specific performance would cause hardship and prejudice a third-party purchaser not joined to the suit. The suit was dismissed with costs to the Defendant.

Key legal issues

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01

Whether the Plaintiff was entitled to a permanent injunction

Holding

The Plaintiff was not entitled to a permanent injunction as he was in breach of the completion clause and the Defendant was entitled to terminate the contract

Reasoning

Clause 4 of the agreement fixed completion at 90 days from signing, time being of the essence. The Plaintiff admitted he never paid the balance within that period, and only demanded completion through his advocate in January 2014, some six years later. His explanation that he could not trace the defendant was tenuous since he knew where to find him. Being himself in breach, he could not obtain the equitable remedy of injunction, applying the authorities cited by the Defendant's counsel.

p. 3
02

Whether the Plaintiff was entitled to specific performance

Holding

Specific performance was refused because the Plaintiff was in breach and the land had been sold to a third party not joined to the suit

Reasoning

Specific performance is an equitable, discretionary remedy unavailable to a party in breach of the contract. Further, the evidence showed the Defendant had sold the suit land to Lochab Transport Ltd in October 2014. Despite knowledge of that sale, the Plaintiff did not amend his plaint to enjoin the purchaser. Granting specific performance would cause severe hardship to the Defendant, who could not transfer the land, and would prejudice the third party's rights.

p. 3

Legal principles established

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  • A party in breach of an essential term of a contract (failure to complete within the contractual completion period) cannot invoke equitable remedies such as injunction or specific performance
  • A vendor is entitled to terminate a contract of sale where the purchaser fails to complete payment within the completion date fixed as the essence of the contract
  • Specific performance will be refused where it would cause hardship to the defendant and prejudice a third party who has not been joined to the proceedings

Court orders

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  1. 1.Dismissal of the Plaintiff's suit
  2. 2.Costs of the suit awarded to the Defendant

Authorities

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Cases cited (7)

  • Alton Homes Ltd vs. David Nathan Chelogoi
    [2018] eKLR
  • Total Kenya Ltd vs. Joseph Ojiem
    Nairobi HCCC No.1243 of 1999
  • Nabro Properties Ltd. Vs. Sky Structures Ltd
    Civil Appeal No. 175 of 2000 [2002]2 KLR 299
  • Nguruman Ltd. Vs. Jan Bonde Nielsen & 2 others
    [2014] eKLR
  • Kenya Commercial Finance Co. Ltd vs. Afraha Education Society
    [2001] Vol. 1 EA 86
  • Keziah Njambi Maingi t/a Arrivals Textile Shop vs. Barclays Bank of Kenya Ltd
    [2016] eKLR
  • Reliable Electrical Engineers Ltd vs. Mantrac Kenya Ltd
    [2006]
Jurisdiction invoked
Original jurisdiction of the Environment and Land Court over disputes relating to land (case transferred from Nairobi ELC Case No. 930 of 2015)

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, "James Njogu Mungai v Francis Kitungo Mutisya [2019] KEELC 1357 (KLR)", Case Analysis (2019). ELC Case No. 6 of 2018 (formerly Nairobi ELC Case No. 930 of 2015). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2019/1357/eng@2019-10-14

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