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ELCDismissedKerugoya CMCC No. 47 of 2015 (Appeal)· [2025] KEELC 729 (KLR)

Muriuki v Muriithi & 3 others (Environment and Land Appeal 10 of 2019) [2025] KEELC 729 (KLR)

Environment and Land Court
20 February 2025
3,636 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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A Kenyan court confirmed that whoever signs a debt-refund agreement must pay it, even if they claim others were supposed to fund it.

What this practically means

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Executive summary

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This is a first appeal to the Environment and Land Court at Kerugoya against the judgment of Hon. S.M.S Soita, Chief Magistrate, delivered on 14th April 2019 in Kerugoya CMCC No. 47 of 2015. The 1st Respondent had sued the Appellant, a land broker, for refund of Kshs 160,000/- paid as a deposit to a vendor, Simon Muthike Githogondo (3rd Respondent), after the sale failed. By a written agreement dated 7th June 2014 the Appellant expressly took over responsibility for that debt and agreed to pay it by 30th September 2014, failing which penal interest of 30% per month would accrue. The Trial Magistrate entered judgment for Kshs 160,000/- with court-rate interest against the Appellant and the 3rd Respondent jointly and severally, dismissed the suit against the 2nd and 4th Respondents, and refused the penal interest as harsh and unconscionable. The Appellant's eight-ground appeal contended that he was merely a witness or conduit and that the refund was to be funded by the 2nd and 4th Respondents, who were the new purchasers. The court, applying Selle v Associated Motor Boat Co., re-evaluated the evidence afresh and held that the Appellant was bound by the express terms of the agreement he signed, that extrinsic evidence could not vary it, and that the 2nd and 4th Respondents, being strangers to the agreement which was not made for their benefit, could not be liable under the privity doctrine. The Trial Magistrate's findings were affirmed, the appeal was dismissed with costs to the 1st, 2nd and 4th Respondents.

Key legal issues

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01

Privity of contract - whether the 2nd and 4th Respondents could be liable on the refund agreement

Holding

The 2nd and 4th Respondents were not parties to the agreement dated 7th June 2014 and the agreement was not made for their benefit, so no liability under it could attach to them

Reasoning

The refund agreement was executed only by the Appellant and the 1st Respondent, with the 3rd Respondent as a witness. Although clause 3 made transfer of land to the 2nd and 4th Respondents a condition for interest, there was no indication that the refund funds were to come from them, and their own sale agreement with the vendor of 4th June 2014 was not subject to the refund agreement. The third-party-beneficiary exception therefore did not apply.

p. 7
02

Personal liability of the Appellant under the debt-takeover agreement

Holding

The Appellant expressly took over responsibility for the debt of Kshs 160,000/- owed to the 1st Respondent by the vendor and was bound by those terms

Reasoning

Clause 1 of the 7th June 2014 agreement recorded that the Debtor (Appellant) had taken over responsibility for the debt owed to the Creditor (1st Respondent) by the vendor. No fraud, coercion or undue influence was suggested. The Appellant's claim that the refund money was to come from the 2nd and 4th Respondents was extrinsic evidence not captured in the agreement and could not vary its express terms.

p. 5
03

Duty of a first appellate court

Holding

The first appellate court must reconsider and evaluate the evidence afresh and draw its own conclusions while making allowance for not having seen or heard the witnesses

Reasoning

Relying on Selle & Another v Associated Motor Boat Co. Ltd & Others (1968) EA 123, the court reaffirmed that an appeal from a trial is by way of retrial and the appellate court is not bound by the trial court's findings of fact where those findings failed to account for material circumstances or probabilities.

Legal principles established

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  • Parties are bound by the terms of a contract they have freely and voluntarily entered into, and a court will not rewrite it absent fraud, coercion or undue influence
  • A contract affects only parties to it and cannot be enforced by or against a non-party, save where the contract is made and intended for the benefit of a third party

Court orders

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  1. 1.The Appeal is dismissed
  2. 2.Costs of the Appeal to the 1st, 2nd and 4th Respondents

Authorities

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Cases cited (16)

  • Anjeline Akinyi Otieno v Malaba Malakisi Farmers Co-op Union Ltd
    (1998) eKLR
  • Danson Muriuki Kibara v Amos Kathua Katungo
    (2012) eKLR
  • Musimba Investments Ltd v Nokia Corporation
    (2019) eKLR
  • Aineah Gikunyani Njirah v Aga Khan Health Services
    (2013) eKLR
  • Mark Otanga Otiende v Dennis Oduor Aduol
    (2021) eKLR
  • Kibugi Farmers Coop Society v Philip Mungai t/a Mungai Electrical Ventures
    (2018) eKLR
  • Total Kenya Ltd v Joseph Ojiem
    Nairobi HCCC No. 1243 of 1999
  • National Bank of Kenya Ltd v Pipleplastic Samkolit (K) Ltd & Another
    (2002) EA 503
  • Universal Education Trust Fund v Monica Chopeta
    (2012) eKLR
  • Savings & Loan (K) Ltd v Kanjenje Karungaita & Another
    (2015) eKLR
  • Agricultural Finance Corporation v Lengetia Ltd
    (1985) KLR 765
  • Kenya National Capital Corporation Ltd v Albert Mario Cordeiro & Another
    CA No. 274 of 2003
  • William Muthee Muthomi v Bank of Baroda
    CA No. 91 of 2004
  • Selle & Another v Associated Motor Boat Co. Ltd & Others
    (1968) EA 123
  • Abdul Hammed Saif v Ali Mohamed Sholan
    (1955) 22 EACA 270
  • Darlington Borough Council v Wiltshire Northern Ltd
    (1995) 1 WLR 68
On appeal from
Chief Magistrate's Court, Kerugoya
CMCC No. 47 of 2015
Jurisdiction invoked
First appellate jurisdiction over the Chief Magistrate's Court judgment (Environment and Land Court)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (1)

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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, "Muriuki v Muriithi & 3 others (Environment and Land Appeal 10 of 2019) [2025] KEELC 729 (KLR)", Case Analysis (2025). Kerugoya CMCC No. 47 of 2015 (Appeal). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/729/eng@2025-02-20

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