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ELCPartially AllowedELC Case Number 1075 of 2016· [2020] KEELC 2375 (KLR)

Jane Muchiku Kimemia v John Mwenja Ngumba [2020] KEELC 2375 (KLR)

Environment and Land Court
14 May 2020
2,185 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~9 min to read original · ~4 min brief

The bottom line

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A Kenyan court ruled that a land buyer who delayed for seven years lost the property, recovering only her deposit minus 10% forfeiture.

What this practically means

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Executive summary

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The Plaintiff sued for specific performance, injunctions, declarations and alternative reliefs arising from a 2009 sale agreement over Plot No. 17, a subdivision of LR No. 74/12, purchased from the Defendant (executor of the estate of the registered owner) for Kshs.4,400,000/=. The deposit was payable within 30 days but was paid 13 days late. Completion was to occur within 180 days or 14 days of registration. The transaction stalled: the Plaintiff's stamp duty cheque was nearly three months late, valuation charges almost ten months late, and she failed to furnish her ID and PIN promptly. After the Defendant changed advocates, a fresh valuation raised stamp duty and penalties to Kshs.308,040/=, which the Plaintiff failed to pay despite a 21-day notice issued on 13th June 2016 under the Law Society Conditions of Sale. The court framed three issues: who breached, whether rescission was proper, and entitlement to remedies. It found the Plaintiff in breach and held that the agreement was properly rescinded upon expiry of the notice on 4th July 2016, applying authority that a vendor may serve a notice limiting time where a purchaser has delayed. Specific performance and injunctions were refused. The claim for Kshs.176,040/= stamp duty failed for lack of evidence of payment, but the Plaintiff was granted refund of Kshs.10,000/= valuation charges with interest at court rates from 17th February 2011 and refund of the deposit less 10% forfeiture. As she substantially lost, no order as to costs was made. Judgment delivered on 14th May 2020 by E. O. Obaga, J.

Key legal issues

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01

Which party breached the sale agreement

Holding

The Plaintiff breached the agreement by late payment of the deposit, delayed remittance of stamp duty and valuation charges, and failure to respond to requests for ID and PIN documents

Reasoning

The deposit was paid 13 days outside the 30-day contractual period. The Plaintiff's stamp duty cheque was nearly three months late, valuation charges almost ten months late, and she failed to remit the revised stamp duty and penalties despite a 21-day notice. The court found the default clearly lay with the Plaintiff.

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02

Whether the agreement was properly rescinded

Holding

Yes. Time not being of the essence, the Defendant lawfully made it so via a 21-day notice under the Law Society Conditions of Sale, which expired unremedied on 4th July 2016

Reasoning

Completion was not achieved within 180 days due to the Plaintiff's delay of about seven years. Relying on the Law Society Conditions of Sale and the cited authorities, the vendor was entitled to serve a notice making time of essence; the Plaintiff failed to remedy the default within 21 days, so the agreement stood rescinded.

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03

Whether the Plaintiff is entitled to the remedies sought

Holding

Specific performance and injunctions refused as the agreement was lawfully rescinded; only refund of Kshs.10,000/= valuation charges and refund of deposit less 10% forfeiture allowed

Reasoning

Since the Plaintiff was in breach and the agreement was rescinded, specific performance does not arise and no injunction lies. The Kshs.176,040/= stamp duty claim failed for lack of evidence of payment, while the Kshs.10,000/= valuation cheque was payable to the Defendant's advocates with no evidence it was refunded.

p. 3

Legal principles established

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  • Where a purchaser is guilty of unnecessary delay, the vendor may serve a notice limiting time, at whose expiry the agreement stands rescinded
  • Before rescission, the party in default must be notified of the default and given reasonable time to rectify it

Court orders

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  1. 1.Refund of Kshs.10,000/= to the Plaintiff with interest at court rates from 17th February 2011
  2. 2.Refund of the deposit paid to the Plaintiff less the 10% forfeited to the Defendant
  3. 3.No order as to costs of the suit

Authorities

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Legislation

  • Law Society Conditions of Salenot specified

Cases cited (2)

  • Housing Company of East Africa Limited Vs Board of Trustees National Social Security Fund & 2 Others
    (2018) eKLR
  • Njamunyu Vs Nyaga
    (1983) eKLR 282
Jurisdiction invoked
Original jurisdiction of the Environment and Land Court (arising from a dispute over Plot No. 17, a portion of subdivision of LR No. 74/12)

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, "Jane Muchiku Kimemia v John Mwenja Ngumba [2020] KEELC 2375 (KLR)", Case Analysis (2020). ELC Case Number 1075 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2020/2375/eng@2020-05-14

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