Bank of Africa Limited v Kikambala Housing Estate Limited & another (Environment & Land Case 355 of 2016) [2024] KEELC 5685 (KLR)
The bottom line
#What this practically means
#Executive summary
#Key legal issues
#Enforceability of an unsigned Agreement to Create Security
The agreement is enforceable; the doctrine of constructive trust applies despite the absence of the 1st Defendant's signature, as other executed documents (Letters of Offer and the Partial Settlement Agreement) confirm the parties' common intention.
The court found the unsigned agreement binding because the parties executed subsequent documents — four Letters of Offer identifying the legal charge as security, the registered first fixed charge of 19th September 2012, and the Partial Settlement Agreement of 11th June 2018 committing the 1st Defendant to execute the surrender instruments, lease and a charge for Kshs. 364,000,000. These demonstrated clear, acted-upon common intention, attracting constructive trust and proprietary estoppel, barring the 1st Defendant from pleading the agreement a nullity.
Entitlement to specific performance of the Agreement to Create Security
The Plaintiff proved its case and was entitled to specific performance: the 1st Defendant was in breach for failing to execute the surrender instruments and lease, and the Plaintiff had performed its part by discharging its charge.
The Plaintiff conditionally discharged its legal charge to enable surrender of the freehold for a leasehold title, on the understanding that a new charge would be registered. The 1st Defendant failed to execute the surrender instruments and lease, breaching the agreement, and continued receiving sale proceeds of housing units contrary to unjust enrichment. Applying the just-and-equitable principle in Gurdev Singh Birdi and Reliable Electrical Engineers, the court granted specific performance since no adequate alternative remedy existed.
Costs
The 1st Defendant, being in breach, was ordered to bear the costs of the suit.
The Plaintiff succeeded on all prayers; the 1st Defendant's defence that the agreement was unsigned failed, and its allegation that delays were attributable to the Plaintiff was rejected. Costs followed the event and were awarded to the Plaintiff against the 1st Defendant.
Legal principles established
#- A party cannot renege on an agreement it induced another to act upon; constructive trust and proprietary estoppel prevent unconscionable resiling from a common intention acted upon.
- Specific performance is a discretionary equitable remedy granted on well-settled principles, founded on a valid, enforceable contract and the absence of an adequate alternative remedy.
Court orders
#- 1.Declaration that the 1st Defendant's failure, neglect and refusal to execute the instrument of surrender of the freehold estate and the lease for Title No. Kilifi/Mtwapa/867 is a breach of the Agreement to Create Security dated 28th October 2013
- 2.Order of specific performance compelling the 1st Defendant to avail its Directors to the 2nd Defendant at the Kilifi Land Registry within 14 days and to execute the surrender of the freehold estate and the lease for Title No. Kilifi/Mtwapa/867
- 3.In default, the 2nd Defendant to transmit the instrument of surrender and lease to the Deputy Registrar, who is directed to execute them on behalf of the 1st Defendant under seal of the Court
- 4.Order compelling the 2nd Defendant to close the freehold register, open the leasehold register, register the 1st Defendant as leasehold proprietor and issue a Certificate of Lease, to be retained by the 2nd Defendant
- 5.Order of specific performance compelling the 1st Defendant to execute a legal charge over the leasehold interest in favour of the Plaintiff within 14 days of issuance of the Certificate of Lease
- 6.In default, the Plaintiff to present the legal charge to the Deputy Registrar, who is directed to execute it on behalf of the 1st Defendant under seal of the Court
- 7.The 2nd Defendant directed to register the Plaintiff's legal charge in the leasehold register within three days of presentation, upon payment of stamp duty and registry fees, and thereafter release the registered charge, lease and Certificate of Lease to the Plaintiff
- 8.Implementation of the above orders to be simultaneous with the partial settlement agreement dated 11th June 2018, pursuant to the findings in Malindi ELC 207 of 2015
- 9.Orders of inhibition placed on land title No. Kilifi/Mtwapa/867 to be removed
- 10.The 1st Defendant shall bear the costs of this suit
- Jurisdiction invoked
- Original jurisdiction of the Environment and Land Court under Article 162(2) of the Constitution and the Environment and Land Court Act (not expressly cited; suit heard as a first-instance civil claim over land)
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (2)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Equip Agencies Limited & 4 others v I&m Bank Limited & 1 other[2026] KECA 1526 (KLR)31 Jul 2026
- Mirikau v Kikambala Housing Estate Limited & another; Bank of Africa Kenya Limited (Proposed Interested Party) (Environment & Land Case 217 of 2018) [2025] KEELC 1097 (KLR)[2025] KEELC 1097 (KLR)6 Mar 2025applied
Cite this brief
#Cite this brief
Caselaw, "Bank of Africa Limited v Kikambala Housing Estate Limited & another (Environment & Land Case 355 of 2016) [2024] KEELC 5685 (KLR)", Case Analysis (2024). Malindi ELC Case No. 355 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/5685/eng@2024-07-18
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.