Kenya Power and Lighting Company Limited v Gimalu Health Estate Limited [2020] KEELC 3783 (KLR)
The bottom line
#Kengen's power line stayed, but it must pay a landowner Kshs 3.85 million compensation after a Kenyan court validated a wayleave agreement signed by just one director.
What this practically means
#Executive summary
#Key legal issues
#Whether the Wayleave Agreement signed by one Director bound the Defendant
The Agreement bound the Defendant because the Defendant did not prove, through its Articles of Association, that a single Director could not bind the company.
The Agreement was signed by Mary Nyaguthii Gichuru, one of three Directors. DW1 asserted she had no authority, but the Memorandum and Articles of Association were never produced. Since a company is regulated by its Articles, the court could not verify the alleged restriction on a Director's power, so the Defendant failed to discharge its burden of proof.
Whether the Plaintiff complied with the Electric Power Act in laying the line
The Plaintiff complied with Section 45(2) of the Electric Power Act (repealed), having given notice and obtained a grant of easement by the Agreement.
The Agreement granted the Plaintiff a right of easement to maintain, alter, use, repair, renew, remove and inspect the electrical line across the suit property. That conduct conformed with the statutory notice-and-entry procedure in Section 45(2). Section 45(3) entitles an owner who objects in writing to compensation as may be agreed upon.
The quantum of compensation payable
Compensation assessed at Kshs. 3,852,000, being 3.21 acres at Kshs. 1,200,000 per acre as at 2002.
The suit was filed in 2002, so the relevant value is that of 2002. The Defendant's valuer (DW2) could not state the 1998 value, and his 2012 report valued the land at Kshs. 58 million, which is not the correct valuation date. The Plaintiff's valuation by Tysons Limited gave Kshs. 1,200,000 per acre for 2002; applied to the 3.21-acre wayleave, this yields Kshs. 3,852,000.
Whether the Defendant proved its claim of Kshs. 72,140,000
The claim failed for want of documentary proof of the academy project and its associated costs.
The Defendant's claim was broken down in its letter of 23rd September 2002, including consultant costs, waste land, and re-planning costs. However, no approved development plan or site plans were produced, nor documents showing the power line would affect the academy. The claim for consultant costs, waste land and re-design therefore could not be sustained.
Legal principles established
#- A limited liability company is regulated by its Articles of Association; a party alleging that a Director lacked authority to bind it must produce and prove the Articles of Association.
- Compensation for land taken up by an electric power line is assessed at the value of the land at the time the suit was filed / the line was laid, not at a later date.
- A party claiming damages for a project allegedly disrupted must produce approved plans and documentary proof of the project and the costs incurred.
Court orders
#- 1.A permanent injunction restraining the Defendant from obstructing or stopping the Plaintiff from entering on a portion of L.R. No. 167/9 to construct, lay, connect, repair and/or maintain an electric power supply line thereon
- 2.The Plaintiff to pay the Defendant Kshs. 3,852,000 being compensation for a portion of L.R. No. 167/9 measuring approximately 3.21 acres
- 3.The Plaintiff to pay interest on the above amount at court rates from 15th November, 2002 until payment in full
- 4.Each party to bear its own costs
- Jurisdiction invoked
- Electric Power Act, No. 11 of 1997 (repealed) and the court's inherent jurisdiction over the suit and counter-claim
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenya Power and Lighting Company Limited v Gimalu Health Estate Limited [2020] KEELC 3783 (KLR)", Case Analysis (2020). High Court Civil Case (as filed 2002, Machakos). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2020/3783/eng@2020-01-31
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.