Lofty Les Fonds Limited v Total Kenya PLC (Environment and Land Case E170 of 2023) [2026] KEELC 994 (KLR)
The bottom line
#A Kenyan landlord won KSh 236 million in unpaid petrol station rent because the tenant never challenged the landlord's valuation evidence.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether this court has jurisdiction to hear and determine the instant dispute
- 2.Whether the Deed of Variation is applicable to the dispute herein
- 3.What was the open market rent of the suit property as of 1/7/2020
- 4.Whether the Plaintiff is entitled to the orders sought
- 5.Costs of the suit
Key legal issues
#Jurisdiction and the effect of the arbitration clause in the Deed of Variation
The ELC has jurisdiction; the dispute concerns rent under the Lease, not the Deed of Variation, and in any event the Defendant waived arbitration by filing a defence and actively defending the suit without a contemporaneous stay application.
The court traced ELC jurisdiction to Article 162(2)(b) and Section 13 of the ELC Act, which covers rents and valuations of land. The Deed of Variation governed only the 2015–2020 rent term and its Clause 12 arbitration clause did not extend to the 2020–2025 term, the arbitrator having already declined jurisdiction. Further, under Section 6 of the Arbitration Act and the Arbitration Rules 1997, the Defendant was required to apply for a stay by summons at the time of entering appearance; it instead filed a defence and participated in the hearing, thereby submitting to the court's jurisdiction and waiving arbitration.
Applicability of the Deed of Variation
The Deed of Variation applies only to the lease term from 1/7/2015 to 30/6/2020 and cannot determine rent for the period 1/7/2020 to 30/6/2025.
The Deed was supplemental to the Lease, and while supplemental agreements are binding, Clause 2 of the Deed fixed a per-litre sales-volume formula expressly for the five-year term commencing 1 July 2015. Recital C confirmed that the Deed determined rent only for that term. The rent for the final five-year term was to be assessed at open market value under Clause 2(a)(iv) of the Lease, which the Deed did not amend. The dispute therefore fell under the Lease and outside the Deed and its arbitration clause.
Determination of the open market rent as at 1/7/2020
The open market rent as of 1/7/2020 was Kshs. 7,752,364 per month and Kshs. 93,028,368 annually, based on the uncontroverted Pinnacle Valuers reports.
The court reiterated that it cannot rewrite the parties' contract and that rent for the final term was to be assessed as open market rent under Clause 2(a)(iv). The Defendant produced no valuation report in court to challenge the Pinnacle reports of 30/6/2022 and 6/3/2023, and called no witness from Tysons Limited; its own witness conceded the Pinnacle figures in cross-examination and confirmed the open market rent had not been assessed or agreed. The Pinnacle reports therefore stood uncontroverted and were adopted.
Entitlement to the reliefs claimed
The Plaintiff discharged the burden of proof under Section 107(1) of the Evidence Act and the suit was allowed as prayed.
It was uncontested that the Defendant failed to fulfil its contractual obligations while occupying the premises. The rent payable for the term was calculated arithmetically from the assessed open market rent, with the agreed interest rate of 14.5% applied to the shortfalls in advance rent. The legal burden lay on the Plaintiff, who invoked the aid of the law, and the unchallenged valuation evidence satisfied that burden, entitling the Plaintiff to the declarations, the underpaid rent, and interest.
Legal principles established
#- A court of law cannot rewrite a contract between the parties; parties are bound by the terms of their contract absent coercion, fraud or undue influence pleaded and proved.
- A party who does not apply for a stay and referral to arbitration at the time of entering appearance, but instead files a defence and actively defends the suit, is deemed to have waived the right to arbitration.
- Duly executed supplementary or supplemental agreements are legally binding and enforceable in their express terms and serve as a record of changes or additions to the original agreement.
- Where an unchallenged valuation report stands uncontroverted by any contrary report or evidence, the court may adopt its figures.
Court orders
#- 1.A declaration that the open market rent for the Premises as on 1/7/2020, applying for the 5-year period from 1/7/2020 to 30/6/2025, is Kshs. 7,752,364/= per month, Kshs. 93,028,368/= per annum and a total Kshs. 456,141,840/= for the 5-year period (all exclusive of VAT)
- 2.Judgment for the Plaintiff in the amount of Kshs. 236,866,510.69 being the open market rent for the period from 1/7/2020 to 30/6/2024 (Kshs. 372,113,472/=) less Kshs. 135,246,961.31/= paid as advance rent
- 3.A declaration that the open market rent for the one-year period from 1/7/2024 to 30/6/2025 is Kshs. 93,028,368/= (exclusive of VAT), due and payable by 1/7/2024
- 4.Interest on the underpaid advance rent from the date it was due to the date of judgment: on Kshs. 45,293,976.35/= from 1/7/2021 at 14.5%; on Kshs. 51,777,451.77/= from 1/7/2022 at 14.5%; and on Kshs. 55,275,078.47/= from 1/7/2023 at 14.5%
- 5.Costs of the suit awarded to the Plaintiff
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- Jurisdiction invoked
- Article 162(2)(b) of the Constitution and Section 13 of the Environment and Land Court Act
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
It is my considered view that the Plaintifi has discharged the burden of proof. It is my further finding that the Plaintifi’s suit is meritorious and is allowed as prayed. The upshot of this Court’s findings is that the Plaintifi’s suit succeeds.
A declaration that the open market rent for the Premises as on 1/7/2020 and which should apply for the 5-year period from 1/7/2020 to 30/6/2025 is Kshs. 7,752,364/= per month, Kshs. 93,028,368/= per annum and a total Kshs. 456,141,840/= for the 5-year period (all exclusive of VAT).
Costs of this suit shall be in favour of the Plaintifi
Jurisdiction is everything. Without it, a Court has no power to make one more step.
A court of law cannot re-write a contract between the parties. The parties are bound by the terms of their contract unless coercion, fraud or undue influence are pleaded and proved.
Issues in the judgment
#The judgment states the rent claim totals Kshs. 456,141,840/= in the declaration, but the pleaded figure in the Plaint is Kshs. 465,141,840 for the five-year period, a discrepancy within the judgment itself.
The Reply to Defence is stated to describe the Deed of Variation as dated 20 August 2025, whereas elsewhere the judgment uses the date 20/8/2015.
The valuation figures for the updated Pinnacle report appear inconsistently as Kshs. 7,752,354 and Kshs. 7,752,364 within the judgment.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Lofty Les Fonds Limited v Total Kenya PLC (Environment and Land Case E170 of 2023) [2026] KEELC 994 (KLR)", Case Analysis (2026). Not stated in the extract (instituted by Plaint dated 15/11/2023). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/994/eng@2026-02-19
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.