John Muriithi Mwaniki v Richard Koskei Buney [2021] KEELC 1367 (KLR)
The bottom line
#A Kenyan court confirmed a land seller must refund a buyer's money but threw out damages and interest awarded for breaching the sale agreement.
What this practically means
#Executive summary
#Key legal issues
#Competency of the cross-appeal
The cross-appeal was competent; the Civil Procedure Rules envisage cross-appeals and the court's powers under Order 42 Rule 32 render the objection academic.
The Appellant argued a Respondent must file a separate appeal citing George Kianda. The court held the Civil Procedure Rules envisage cross-appeals, relied on Diamond Trust Bank which declined to follow George Kianda, and noted Order 42 Rule 32 empowers it to pass any decree in favour of respondents even without a cross-appeal.
Refund of the purchase price
The trial court did not err in ordering the refund; the rescission agreement gave the Appellant two options and he could not keep both the money and the land.
The rescission agreement required the Appellant either to refund Kshs 183,000/= within 90 days or hand over completion documents. Having sold the property to a third party, the only complete resolution was a refund. Ordering a separate suit would defeat the overriding objective of timely, proportionate and cost-effective dispute resolution.
General damages for breach of contract
The award of Kshs 100,000/= general damages was erroneous in law and was set aside.
Following settled Court of Appeal authority (Kenya Power & Lighting v Birundu; Kenya Tourist Development Corporation v Sundowner Lodge, both tracing to Dharamshi v Karsan), general damages are not recoverable in breach-of-contract claims. Only special damages, which must be specifically pleaded and proved, are awardable. The entire award and its interest were set aside.
Specific performance
Specific performance was rightly refused because the suit property had been sold to a third party who was not joined and whose sale was not sought to be nullified.
There was uncontroverted evidence the Appellant sold the property to raise refund funds. The purchaser was not joined and nullification was not pleaded. A mere belief that the sale was null and void cannot cancel it. Applying Fiat Kenya v Rable, the court cannot award specific performance it cannot enforce.
Interest
Pre-judgment interest from 29th April 2016 was erroneous; interest on the refund runs from the date of judgment, and none on general damages as that award was set aside.
Under section 26 of the Civil Procedure Act, interest before filing suit requires contractual stipulation, mercantile usage (pleaded and proved), or statutory right. None existed here. The court therefore set aside the interest from the contract date and substituted interest from judgment on the refund.
Costs
The trial court's award of costs to the successful Respondent was affirmed; the ground was not pursued in submissions.
Costs follow the event under section 27 of the Civil Procedure Act, and no error of principle was demonstrated. The Appellant raised the issue but made no submissions on it, so the trial court's discretion was not shown to have miscarried.
Legal principles established
#- General damages are not awardable for breach of contract; only special damages may be awarded.
- A Respondent may competently file a notice of cross-appeal under Order 42 of the Civil Procedure Rules.
- Specific performance will not be ordered where the court cannot enforce it because the subject property is no longer available.
- Interest before the date of filing suit requires contractual, mercantile-usage or statutory foundation; otherwise interest runs from judgment under section 26 of the Civil Procedure Act.
- Costs follow the event and a successful litigant should normally be awarded costs.
Court orders
#- 1.The trial court's award of general damages of kshs 100,000/= for breach of contract together with interest thereon is set aside in its entirety.
- 2.The order for the Appellant to refund the purchase price of ksh 183,000/= is affirmed save that interest thereon shall run from the date of judgment and not the date of the rescission agreement.
- 3.The trial court's order awarding the Respondent costs of the suit is affirmed.
- 4.The Respondent's cross-appeal is dismissed.
- 5.There shall be no order as to costs on the appeal and cross-appeal.
- On appeal from
- Chief Magistrate's Court, Nyahururu (Environment and Land)
- 273 of 2018
- Jurisdiction invoked
- First appellate jurisdiction under the Civil Procedure Act and Order 42 of the Civil Procedure Rules over the Chief Magistrate's Environment and Land judgment
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "John Muriithi Mwaniki v Richard Koskei Buney [2021] KEELC 1367 (KLR)", Case Analysis (2021). Nyahururu Environment and Land Case Appeal No. 273 of 2018 (arising from Nyahururu CM ELC No. 273 of 2018). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2021/1367/eng@2021-10-21
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.