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ELCPartially AllowedEnvironment & Land Case E006 of 2021· [2024] KEELC 3581 (KLR)

Joseph Muturi Wainaina v Clement Kungu Waibara

Environment and Land Court
9 April 2024
GKG Kemei
5,675 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~23 min to read original · ~4 min brief

The bottom line

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A Kenyan land seller who accepted late payments and kept the rent lost his case, and must now transfer the land to the buyer.

What this practically means

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Executive summary

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The Plaintiff sued for an injunction, rescission of the sale agreement over Ruiru/Ruiru East Block 7/649, refund of rents collected by the Defendant, security costs, mesne profits and general damages, alleging the Defendant defaulted on the Kshs 1 Million balance of a Kshs 25 Million purchase price and forcibly interfered with tenants. The Defendant admitted the agreement and counterclaimed for specific performance, damages, mesne profits and costs, asserting he had fully paid through an arrangement by which the Plaintiff retained rents to offset the balance. The Plaintiff withdrew the refund prayer; the security-costs claim was unproved. The court found a valid written, signed and attested agreement. It held that by accepting late instalments without invoking the default clause the parties altered the contract by conduct, and that the alleged oral arrangement to settle the balance from rental income was the more probable account, the alleged loans being unsupported by documentation. The 21-day completion notice did not specify the default, service was not proved, and it was not allowed to run its course. No breach was established. Applying Gurdev Singh Birdi, the court found the Defendant had fully paid and was entitled to specific performance. The Plaintiff's suit was dismissed; the counterclaim succeeded partially: specific performance to transfer within 30 days (Deputy Registrar to execute in default), damages and mesne profits declined, and Kshs 315,000/- excess rent payable to the Defendant, recoverable summarily if unpaid. The Defendant received the costs of the suit and counterclaim.

Key legal issues

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01

Validity of the sale agreement

Holding

The sale agreement was valid, being in writing, signed by both parties and attested by their joint counsel, satisfying section 3(3) of the Law of Contract Act and section 38 of the Land Act.

Reasoning

The court applied the statutory formalities for contracts disposing of interests in land. The agreement dated 20/6/2018 (referred to in places as 28/6/18) for Kshs 25 Million met the requirements of writing, signature by all parties and attestation by a witness, being their joint counsel. No defect, mistake or illegality was shown.

p. 7
02

Breach of the agreement and the alleged oral arrangement to settle the balance from rent

Holding

Neither party breached the agreement; the parties by conduct altered the terms, and the arrangement to settle the Kshs 1 Million balance through rental income was more probable than not.

Reasoning

Although completion was due in 90 days with time of the essence, the Plaintiff accepted instalments beyond that date without invoking the default clause, evidencing an alteration by conduct. The alleged Kshs 130,000/- and 65,000/- payments to the Defendant's wife's account matched rent figures rather than loan amounts, and no loan documentation was produced. The 21-day notice of 21/1/2021 did not state the default, was not proved served, and was not allowed to run its course.

p. 9
03

Specific performance

Holding

The Defendant, having fully paid the purchase price (the Kshs 1 Million balance through rent) and complied with his obligations, was entitled to specific performance requiring the Plaintiff to transfer the suit land.

Reasoning

Applying Gurdev Singh Birdi, the court held specific performance rests on a valid enforceable contract and is granted where just and equitable. The Defendant had performed his essential obligations; the Plaintiff could not receive the full purchase price, collect rent not due to him, and still seek to defeat the transfer. Equity regards as done that which ought to be done.

04

Mesne profits, damages and rents

Holding

The Plaintiff's special damages and the Defendant's mesne profits were not proved; only Kshs 315,000/- excess rent collected by the Plaintiff beyond the Kshs 1 Million balance was due to the Defendant.

Reasoning

Mesne profits and special damages must be specifically pleaded and proved. The Plaintiff's security-cost claim of Kshs 36,000/- was unproved and his refund prayer withdrawn. Calculating rent from 25/1/2019, when the last instalment was paid, the Plaintiff collected Kshs 1,365,000/- over 21 months, less Kshs 185,000/- remitted, leaving Kshs 315,000/- due to the Defendant.

p. 11

Legal principles established

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  • A contract for the disposition of an interest in land is valid where it is in writing, signed by all parties and attested by a witness.
  • Courts cannot re-write contracts for parties nor imply terms that were not part of the contract; parties may by conduct alter the terms of their agreement.
  • Specific performance is a discretionary equitable remedy granted where it is just and equitable, based on a valid enforceable contract, and may be refused where damages are adequate.
  • Mesne profits, like special damages, must be pleaded and proved.

Court orders

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  1. 1.The Plaintiff's case fails. It is dismissed.
  2. 2.An order of specific performance of the sale agreement dated the 20/6/2018 requiring the Plaintiff to transfer the suit land to the Defendant within 30 days, in default the Deputy Registrar to execute all necessary documents
  3. 3.Damages for breach of contract in favour of the Defendant declined
  4. 4.Mesne profits disallowed
  5. 5.The Plaintiff to pay the Defendant Ksh. 315,000/- within 30 days being excess rent collected, in default recoverable summarily
  6. 6.The Defendant shall have the costs of the suit and the counterclaim

Authorities

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Legislation

  • Law of Contract ActSection 3(3)
  • Land ActSection 38
  • Auctioneers Act(Cap. 526) (referenced within section 3(3) proviso)

Cases cited (6)

  • Jinaro Mamo Mugambi Vs. Josephat Kahure Ndungu
    (2014) eKLR
  • Gurdev Singh Birdi & Narinder Singh Ghatora as Trustees of Ramgharia Institute of Mombasa Vs. Abubakar Madhbuti
    [1997] eKLR
  • Rufale Vs. Umon Manufacturing Co. (Ramsboltom)
    (1918) L.R 1KB 592
  • Attorney General of Belize et al Vs. Belize Telecom Ltd & Anoter
    (2009), 1WLR 1980
  • Trollope Colls Ltd Vs North West Metropolitan Regional Hospital Board
    (1973) I WLR 601
  • Curtis Vs Chemical Cleaning & Dyeing Co. Ltd
    (1951), ALL ER 631
Jurisdiction invoked
Original jurisdiction of the Environment and Land Court over disputes relating to land (not expressly cited in the judgment)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (2)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Joseph Muturi Wainaina v Clement Kungu Waibara", Case Analysis (2024). Environment & Land Case E006 of 2021. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/3581/eng@2024-04-12

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