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ELCPartially AllowedELCA E028 of 2023 & ELCA E036 of 2023 (Consolidated)· [2025] KEELC 581 (KLR)

Patrick Makanga Munala v Surer Khalif Bale & others; National Social Security Fund v Surer Khalif Bale & others

Environment and Land Court
13 February 2025
3,700 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~15 min to read original · ~4 min brief

The bottom line

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Kenyan court rules that oral land purchase promises are unenforceable — without a written, signed agreement, a buyer who paid Kshs 550,000 could only recover the money back.

What this practically means

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Executive summary

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This is a judgment of the Environment and Land Court at Kajiado (M.D. Mwangi, J) in two consolidated first appeals, ELCA E028 of 2023 (by Patrick Makanga Munala) and ELCA E036 of 2023 (by the National Social Security Fund), against the judgment of Hon. B.M. Cheloti (PM) in Milimani Commercial Court Civil E143 of 2020 delivered on 29th September 2023. The Appellant Munala claimed he deposited Kshs. 550,000 into the NSSF account in 2018 as purchase price for L.R No. 97/21190/5180 Tassia following a direction by Bishop Lawi, but there was no written sale agreement. The court held that a suit on a land contract failing Section 3(3) of the Law of Contract Act is untenable, that a purchaser must conduct due diligence, and that NSSF owed no duty of care given the absence of any relationship; it therefore dismissed Munala's appeal. The 1st Respondent's counterclaim, founded on the chain of sale from NSSF to the 5th Respondent and then to him, was upheld on a balance of probabilities. On NSSF's appeal, the court held the trial court wrongly awarded market-rate interest from the deposit date; interest under Section 26 of the Civil Procedure Act is unavailable before suit, and the Appellant was entitled only to court-rate interest (12% per annum) from filing until payment in full. The trial court's costs order was also set aside, each of those parties bearing its own costs. Each party bears its own costs of the appeals.

Key legal issues

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01

Viability of an oral land sale claim under Section 3(3) Law of Contract Act

Holding

The claim failed; no written signed and attested agreement existed

Reasoning

The Appellant relied on an oral direction by Bishop Lawi in 1998 and deposited money in 2018 with no agreement in writing signed by the parties and attested as required by Section 3(3) of the Law of Contract Act, repeated in Section 38(1) of the Land Act. Such a contract is invalid and a suit founded on it is untenable, following Silverbird and Patrick Tarzan Matu.

p. 5
02

Due diligence by an intending purchaser of land

Holding

The Appellant failed to exercise due diligence

Reasoning

Relying on Said v Shume, Dina Management and the Ugandan Supreme Court in Lwanga v Mbiru, the court held a purchaser must investigate the land and the seller. The Appellant did not confirm with the 3rd Respondent's authorized officers that the land was on sale, nor verify Bishop Lawi's authority, 20 years after being told the land was on sale.

p. 5
03

Duty of care by the 3rd Respondent

Holding

No duty of care was owed

Reasoning

The trial court's finding of a duty of care was upset because there was no contractual or other relationship between the 3rd Respondent and the Appellant; the claim was founded on an assumed contract of sale of land, not tort. Absent any relationship, no duty of care could arise.

p. 6
04

Interest on the refunded deposit

Holding

Interest allowed only at court rate (12%) from date of filing suit

Reasoning

Under Section 26 of the Civil Procedure Act as explained in Kipchumba, interest before suit requires a contractual, mercantile or statutory basis, none proved. The trial court erred awarding market-rate interest from deposit date. Since the 3rd Respondent did not offer to refund on being sued, interest runs from filing at the court rate of 12% per annum.

p. 7
05

Costs of the trial suit

Holding

Trial court's discretion was wrongly exercised; each party to bear own costs

Reasoning

Applying Party of Independent Candidates of Kenya v Mutula Kilonzo, costs follow the successful party. The Appellant's land claim failed, so he was not the successful party, and the circumstances dictated that the Appellant and the 3rd Respondent each bear their own costs of the suit.

p. 7
06

1st Respondent's counterclaim

Holding

Upheld

Reasoning

The 3rd Respondent, registered owner of the suit property, admitted selling it to the 5th Respondent who sold to the 1st Respondent. The evidence proved the 1st Respondent's case on a balance of probabilities and the trial court's decision upholding the counterclaim was sustained.

p. 7

Legal principles established

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  • A contract for the sale of land not in writing, signed and attested as required by Section 3(3) of the Law of Contract Act is invalid and a suit premised on it is untenable
  • A bona fide purchaser for value must prove acquisition of valid and legal title and that necessary due diligence was carried out
  • Interest prior to filing suit is a matter of substantive law and not available under Section 26 of the Civil Procedure Act absent contractual, mercantile or statutory basis

Court orders

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  1. 1.The Appellant's appeal filed as ELCA E028 of 2023 is dismissed
  2. 2.The 3rd Respondent's appeal filed as ELCA E036 of 2023 partially succeeds
  3. 3.The trial court's order directing refund of Kshs. 550,000 with interest at current market rate from 27th November 2018 is set aside and substituted with an order for refund of Kshs. 550,000 with interest at court rates from the date of filing suit until payment in full
  4. 4.The order directing the 3rd Respondent to meet the costs of the Appellant's suit before the trial court is set aside and substituted with an order that each party bears its own costs
  5. 5.Each party in this appeal shall bear its own costs

Authorities

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Legislation

  • Law of Contract ActSection 3(3)
  • Land ActSection 38(1)
  • Civil Procedure ActSection 26

Cases cited (11)

  • Selle and Another Versus Associated Motor Boat Company Ltd & Others
    [1968] EA
  • Peter M. Kariuki v Attorney General
    [2014] eKLR
  • Ngui v Republic
    (1984) KLR 729
  • Susan Munyi v Keshar Shiani
    Civil Appeal No. 38 of 2002 (unreported)
  • Silverbird (K) Limited –vs- Junction Limited & 3 others
    (2013) eKLR
  • Patrick Tarzan Matu & ano -vs- Sharifi & others
    (2009) eKLR
  • Said –vs- Shume & 2 others
    (Civil Appeal E050 of 2023) (2024) KECA 866 (KLR)
  • Dina Management Limited –vs- County Government of Mombasa & 5 others
    Petition 8 (E010) of 2021 (2023) KESC 30 (KLR)
  • Lwanga –vs- Mbiru & others
    (Civil Appeal No. 18 of 2022) (2024) UGSC 7
  • Kipchumba –vs- BOG Tambach Teachers Training College
    (Civil Appeal 100 of 2019) (2023) KECA 802 (KLR)
  • Party of Independent Candidates of Kenya & ano –vs- Mutula Kilonzo & 2 others
    (2013) eKLR
On appeal from
Milimani Commercial Court (Magistrates' Court)
Civil E143 of 2020
Jurisdiction invoked
First appellate jurisdiction over appeals from the magistrates' court in land and environment matters

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, "Patrick Makanga Munala v Surer Khalif Bale & others; National Social Security Fund v Surer Khalif Bale & others", Case Analysis (2025). ELCA E028 of 2023 & ELCA E036 of 2023 (Consolidated). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/581/eng@2025-02-13

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