Kamuthi Farmers Co-operative Society Ltd v Nairobi City Conty; Archdioces of Nairobi (Kahawa West Catholic Church) & 18 others (Interested Parties) [2020] KEELC 2253 (KLR)
The bottom line
#What this practically means
#Executive summary
#Key legal issues
#Validity of the 1973 sale agreement over 154.5 acres
The sale agreement dated 2nd January 1973 was duly signed and sealed by authorised signatories of Kahawa Farmers Cooperative Society Limited and is valid and enforceable.
The agreement bore the society's common seal; PW2 confirmed the seal and could not produce minutes showing members rejected the sale or a list of authorised signatories, nor did the plaintiff produce the society's by-laws to show a members' resolution was required. The presidential gazette notice of 1974 exempting the transaction from Land Control Board consent was unchallenged. Payment of the purchase price was proved.
Validity of the 1979 sale of 21.238 acres without a written agreement
The transaction was valid; section 3(3) of the Law of Contract Act does not apply to contracts made before its commencement by virtue of section 3(7), and the price was fully paid and unchallenged.
Documents executed by the City Council and the society recorded the agreed terms and acknowledged receipt of the Kshs.435,000 purchase price. DW2, a former official of the plaintiff, confirmed the transaction and his own compensation. The plaintiff did not challenge this evidence, so the sale stood proved.
Whether Kahawa Farmers held the two portions in trust for the defendant
Yes. Having received the purchase price and given possession, the society held the portions in trust; the 1989 conveyance of the whole 415 acres to the plaintiff and the 2016 title to LR 71/7/10 are void.
Applying the doctrine of constructive trust and the authorities cited, the court found the society intended to transfer the portions. Conveying the entire parcel in 1989 without excising the sold portions defeated the defendant's accrued equitable interest and was unconscionable, so the conveyance and subsequent title were void.
Mesne profits
The plaintiff is not entitled to mesne profits because the defendant's occupation was not wrongful.
Since the defendant purchased the two portions and was placed in possession by the vendor society, it was neither a trespasser nor a licensee. Without wrongful occupation, no mesne profits can arise, so the court declined to make any award or assess quantum.
Legal principles established
#- A vendor who has been paid the full purchase price and has put the purchaser in possession cannot later defeat the purchaser's equitable interest by conveying the property to a third party.
- Section 3(7) of the Law of Contract Act preserves oral or informal contracts for the disposition of land made before the commencement of section 3(3).
- Payment of the purchase price and delivery of possession can give rise to a constructive trust in favour of the purchaser.
Court orders
#- 1.Declaration that the defendant is, pursuant to the sale agreements between itself and Kahawa Farmers Co-operative Society Limited, entitled to be registered as proprietor of two portions measuring approximately 154.5 acres and 21.238 acres out of LR No. 71/7
- 2.Declaration that the sale transaction of 21.238 acres between the defendant and Kahawa Farmers Cooperative Society Limited between 1979 and 1981 is valid and that the defendant is entitled to be registered as proprietor of the said portion
- 3.Declaration that Kahawa Farmers Co-operative Society Limited held the portions of 154.5 and 21.238 acres in trust for the defendant and that the conveyance of Land Reference No. 71/7 to the plaintiff absolutely was void
- 4.Order compelling the plaintiff to excise and transfer the portions of 154.5 acres and 21.238 acres out of LR No. 71/7 occupied by the defendant to the defendant; in default, the Deputy Registrar of the High Court to execute the necessary documents to vest those portions in the defendant
- 5.The defendant to have the costs of the suit and interest
- Jurisdiction invoked
- Original civil jurisdiction of the High Court over a land dispute concerning LR No. 71/7; not stated by provision in the judgment
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kamuthi Farmers Co-operative Society Ltd v Nairobi City Conty; Archdioces of Nairobi (Kahawa West Catholic Church) & 18 others (Interested Parties) [2020] KEELC 2253 (KLR)", Case Analysis (2020). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2020/2253/eng@2020-06-04
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.