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ELCOtherNot stated in the extract· [2022] KEELC 2062 (KLR)

Manjula Dhirajlal Soni v Dukes Investments International Limited & 2 others; Chandulal Ratilal Bhurabhai Soni (Interested Party) [2022] KEELC 2062 (KLR)

Environment and Land Court
17 January 2022
EWE. K. WABWOTO
3,229 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~13 min to read original · ~4 min brief

The bottom line

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Kenya's Environment and Land Court confirmed it can hear disputes arising from land sale agreements, rejecting arguments that such claims belong only to the High Court.

What this practically means

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Executive summary

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By an Amended Plaint dated 26th February 2020, the Plaintiff sued the Defendants over an agreement for sale of L.R No. 209/525/4 dated 28th September 2013, seeking a permanent injunction restraining disposition of the property, specific performance or, in the alternative, rescission, general damages, costs and interest. The 3rd Defendant raised a preliminary objection contending that the Environment and Land Court lacked jurisdiction, arguing the suit was a purely commercial dispute for exclusive determination by the High Court under Article 165(3) of the Constitution, and relying principally on Cooperative Bank of Kenya Ltd v Patrick Kangethe Njuguna. The Plaintiff countered that the suit fell squarely within Article 162(2)(b) and Section 13 of the ELC Act, and that the Cooperative Bank case was inapplicable given the absence of privity of contract with the 3rd Defendant. The court framed a single issue: whether it had jurisdiction. After reviewing the law on preliminary objections (Mukisa Biscuit, Nitin Properties, Joho, IEBC v Cheperenger) and the constitutional and statutory conferral of ELC jurisdiction, the court distinguished Cooperative Bank and followed the Court of Appeal's decision in Nakumatt Holdings v Ideal Locations. Applying the predominant purpose test from Suzanne Butler v Redhill Investments, it held that the suit arose from an agreement for sale of land, was predominantly a land dispute, and that the ELC had jurisdiction. The 3rd Defendant's objection was declined and the court ordered 'It is so ordered.'

Key legal issues

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Whether the ELC has jurisdiction over a suit arising from an agreement for sale of land where the 3rd Defendant contends the dispute is purely commercial.

Holding

The ELC has jurisdiction. The suit arises from an agreement for sale of L.R No. 209/525/4, a contract relating to the 'use' of land, and the predominant purpose of the suit is resolution of a land dispute.

Reasoning

The court reviewed Article 162(2)(b) of the Constitution and Section 13 of the ELC Act, which confer jurisdiction over disputes relating to land and contracts granting enforceable interests in land. Relying on Nakumatt Holdings v Ideal Locations, and applying the predominant purpose test from Suzanne Butler v Redhill Investments, the court found the transaction predominantly concerned the sale of land. Even under the Cooperative Bank criteria, the claim relates to breach of a land sale agreement. Jurisdiction was accordingly upheld and the objection declined.

p. 5

Legal principles established

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  • Where a dispute involves a contract concerning land, jurisdiction hinges on the predominant purpose of the transaction; if predominantly for land, the ELC has jurisdiction.
  • An issue going to the jurisdiction of the Court must be dealt with in limine.

Court orders

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  1. 1.The 3rd Defendant's preliminary objection on jurisdiction is declined
  2. 2.The suit remains before the Environment and Land Court for hearing on the merits

Authorities

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Legislation

  • Constitution of KenyaArticle 162(2)(b)
  • Constitution of KenyaArticle 165(3)
  • Constitution of KenyaArticle 165(5)
  • Constitution of KenyaArticles 42, 69 and 70
  • Environment and Land Court ActSection 13
  • Land Act No. 6 of 2012Section 150
  • Insolvency ActSection 430

Cases cited (10)

  • Cooperative Bank of Kenya Limited v Patrick Kangethe Njuguna & 5 Others
    [2017] eKLR
  • Mukisa Biscuit Manufacturing Co Ltd v West End Distributors Ltd
    [1969] EA 696
  • Nitin Properties Ltd v Singh Kalsi & another
    [1995] eKLR
  • Oraro –v- Mbaja
    [2007] KLR 141
  • Hassan Ali Joho & another -v- Suleiman Said Shabal & 2 Others
    SCK Petition No. 10 of 2013 [2014] eKLR
  • Independent Electoral & Boundaries Commission –v- Jane Cheperenger & 2 Others
    [2015] eKLR
  • Owners of the Motor Vessel "Lilian S" vs. Caltex Oil (Kenya) Limited
    [1989] KLR 1
  • Samuel Kamau Macharia -vs- Kenya Commercial Bank & 2 Others
    Civil Appl. No. 2 of 2011
  • Nakumatt Holdings Limited & Another v Ideal Locations Limited
    (2019) eKLR
  • Suzanne Butler & 4 Others v Redhill Investments & Another
    [2017] eKLR
Jurisdiction invoked
Article 162(2)(b) of the Constitution and Section 13 of the Environment and Land Court Act

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, "Manjula Dhirajlal Soni v Dukes Investments International Limited & 2 others; Chandulal Ratilal Bhurabhai Soni (Interested Party) [2022] KEELC 2062 (KLR)", Case Analysis (2022). Not stated in the extract. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/2062/eng@2022-01-17

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