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ELCDismissedPetition (application dated 21/2/2019)· [2019] KEELC 1948 (KLR)

James Kiongi Mwaura & 2 others v Cabinet Secretary for Environment and Forestry & another [2019] KEELC 1948 (KLR)

Environment and Land Court
29 July 2019
KBK. BOR
835 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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The Environment and Land Court refused to suspend an order requiring land sellers to deposit KShs 24.5 million, holding purchase deposits must be preserved until a sale is finalised.

What this practically means

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Executive summary

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The Petitioners, through an application dated 21/2/2019, sought a stay of execution of this court's judgment of 26/3/2018 in the same petition, pending hearing and determination of ELC Civil Suit No. 16 of 2019, which the court had directed be filed as the appropriate avenue for redress for alleged breaches of contract. The 2018 judgment had directed the Petitioners to deposit Kshs. 24,500,000/=, being the deposit of the purchase price paid by the Ministry of Environment, in court or in a joint interest-earning account. The Petitioners, through an affidavit of Godfrey Kiongi Mwaura, contended they had already appropriated the deposit (for medication and school fees), could only raise the sum by selling the disputed land, and would suffer irreparable loss. Dr. Ibrahim M. Mohammed, the Principal Secretary, opposed the application, alleging contempt of court orders, inordinate delay in filing, and that a deposit in a land transaction is held in trust until finalisation. In submissions the Petitioners claimed a prima facie case with high probability of success. The court held that the deposit sum forms the substratum of the suit in ELC Suit No. 16 of 2019 and ought to be deposited to preserve it, to be released to whichever party prevails in that suit. It found the suit property was not sufficient security and that the Petitioners should have held the deposit until the sale transaction concluded. The application was dismissed with each party bearing its own costs.

Key legal issues

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01

Whether stay of execution should be granted where the ordered deposit is the substratum of the subsequent suit

Holding

Stay refused; the sum of Kshs. 24,500,000/= must be deposited to preserve it pending the outcome of ELC Civil Suit No. 16 of 2019

Reasoning

The court reasoned that the deposit forms the substratum of the pending suit and must be preserved: if the Petitioners succeed in the new suit the funds will be released to them, and if they fail, to the Respondents. The Petitioners' appropriation of the deposit and inability to refund it weigh against a stay, as the government stands to suffer loss if the sum is not secured.

p. 2
02

Whether the suit property is sufficient security in lieu of the deposit

Holding

The court found the suit property would not be sufficient security as the Petitioners contended

Reasoning

The Petitioners argued in their further affidavit that the land in question is sufficient security if the new suit is decided against them. The court rejected this, noting the deposit should have been held until the sale transaction was concluded, and that the land could not stand in place of the refund of the purchase price deposit.

p. 2

Legal principles established

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  • A deposit of the purchase price in a land transaction is deemed to be held in trust until the transaction is finalised and should not be appropriated before transfer of title

Court orders

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  1. 1.The orders sought in the application dated 21/2/2019 for stay of execution were declined
  2. 2.Each party to bear its own costs
Jurisdiction invoked
Original petition before the Environment and Land Court; judgment of 26/3/2018 in the same petition

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 Kiongi Mwaura & 2 others v Cabinet Secretary for Environment and Forestry & another [2019] KEELC 1948 (KLR)", Case Analysis (2019). Petition (application dated 21/2/2019). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2019/1948/eng@2019-07-29

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