Francis Otieno Opondo v Mathew Ooko Ogutu

2) That the Learned trial Magistrate erred in law and fact by granting a refund of the compensation amount, while disregarding the fact that the Respondent had already benefited from the agreement by occupying part of the Appellant's land from 2011 – 2025 earning rent of Kshs. 25,000 per month. 3) That the trial Court erred in law and fact by failing to consider that the Respondent was in breach of the agreement by not completing the agreed compensation, thereby disentitling him from equitable relief. 4) That the trial Court erred in law and fact by awarding interest on the refunded amount without considering the Appellant's counterclaim and the Respondent's continued occupation of the disputed premises. 5) That the trial Court erred in law and fact by failing to consider that the Respondent is in unlawful occupation and encroachment of the Appellant's parcel of land and continues to do so, thereby rendering the judgment unjust and inequitable. 6) That the trial court judgment was against the weight of evidence and contrary to law. 2. On the basis of the above grounds the Appellant seeks the following reliefs; a) This Appeal be allowed. JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 2

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b) The Judgment and decree of the subordinate court be set aside in its entirety. c) That this Honourable Court be pleased to find that the monies paid by the Respondent to the Appellant were in respect of compensation for encroachment and not for the purchase of land and further that the Appellant is not liable to refund the same. d) That this Honourable Court be pleased to find that the Respondent is in unlawful encroachment of the Appellant's land. 3. It is observed, for accuracy, that the Memorandum of Appeal describes the impugned decision as having been delivered in Ukwala ELC 18 of 2018, whereas the certified Judgment on record, the decree sought to be impugned and the entire lower court record are consistently referenced as Ukwala ELC No. 11 of 2018. The court will treat the reference to ELC 18 of 2018 as a clerical error and proceed on the basis of the Judgment that has been placed before me. 4. Directions were issued by the Court that the appeal proceeds by way of written submissions, which the parties complied with. Appellant's Submissions 5. The Appellant, through the firm of Achero Mufuayia & Co. Advocates dated 21st August 2025, condensed the six JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 3

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grounds of appeal into three issues for determination as follows: i. Whether the trial court erred in interpreting the Agreement of 29th August 2015 as a sale of land rather than compensation for encroachment. ii. Whether the Respondent is entitled to a refund of the sum paid, given his continued occupation of the Appellant's land. iii. Whether the trial court adequately considered the Appellant's evidence and submissions. 6. On the first issue, it is submitted that the evidence showed that the Respondent had encroached upon the Appellant's land and that the Agreement dated 29th August 2015 was for compensation for that encroachment and not for the sale of any portion of land. Reliance is placed on Gitonga v M'Mwirichia & Another (2025) KEELC 395 (KLR), where the court stated that: "The interpretation of a contract must be guided by the intention of the parties, which can be discerned from the language used and the circumstances is submitted surrounding the agreement." 7. Applying that principle, it that the circumstances surrounding the Agreement, the admitted encroachment and the Respondent's construction on the JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 4

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Appellant's land point only to an intention to compensate for trespass and not to transfer ownership of any land. 8. On the second issue, it is submitted that the trial court erred in ordering a refund of Kshs. 200,000/= without regard to the fact that the Respondent has continued to occupy and benefit from the encroached portion without completing payment under the Agreement and that these occasions unjust enrichment in the Respondent's favour. Reliance is placed on Collins v Ogango (2024) KECAV19 (KLR), where it was held that: "A party cannot seek equitable relief while continuing to benefit from the subject matter of the dispute without fulfilling their obligations..." 9. On the third issue, it is submitted that the trial court failed to adequately evaluate the evidence and submissions placed before it, relying on Gichira v Kariuki (2023) KEELC 21597 (KLR), for the proposition that: "A trial court must evaluate all the evidence and submissions before it to arrive at a just decision." 10. It is submitted that this omission occasioned a miscarriage of justice and the Court is urged to allow the appeal, set aside the judgment and decree of the trial court, dismiss the Respondent's suit and award the Appellant the costs of the appeal and of the lower court. JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 5

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The Respondent's Submissions 11. The Respondent, through the firm of M. Kiveu Advocates, filed submissions dated 14th November 2025 opposing the appeal and urging this Court to uphold the Judgment of the trial court delivered on 5th June 2025. 12. It is submitted that this being a first appeal, the Court is duty bound to reconsider and re-evaluate the evidence and reach its own conclusions, relying on Gitobu Imanyara & 2 Others v Attorney General [2016] eKLR, where the Court of Appeal held that: "...this being a first appeal, it is trite law that this court is not bound necessarily to accept the findings of fact by the court below... [it] must reconsider the evidence, evaluate it itself and draw its own conclusions though it should always bear in mind that it has neither seen nor heard the witnesses and should make due allowance in this respect." 13. It is was further submitted that the Appellant's own evidence at trial was equivocal as to whether the sum received and the shop unit surrendered constituted compensation and that it is not the function of the Court to relieve a party of the consequences of a contract merely because its terms later prove unfavourable to him. Reliance is placed on National Bank of Kenya Ltd v Pipeplastic JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 6

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Samkolit (K) Ltd & Another [2001] eKLR, where it was held that: "A court of law cannot rewrite 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." 14. Reliance is also placed on William Muthee Muthami v Bank of Baroda [2014] eKLR for the proposition that a party seeking to enforce a contract must in addition prove that there was offer, acceptance and consideration all of which are said to be established on the record including the Appellant's own admission that he received Kshs. 200,000/= and occupied and used one of the shops built by the Respondent. Finally, invoking the observation in Chalicha Farmers Co-operative Society Ltd v George Odhiambo & 9 Others [1987] eKLR that a court is governed by principles of law not hardship of any individual case, it is submitted that whatever sympathy the Appellant's position may attract cannot found a departure from the plain terms of an agreement he freely executed. The Court is urged to dismiss the appeal and uphold the judgment of the trial court as manifestly fair and occasioning no miscarriage of justice. ANALYSIS AND DETERMINATION JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 7

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15. Having considered the Record of Appeal and the rival submissions of the parties. I note that Counsel for the appellant consolidated the grounds of appeal into four grounds of appeal. I will proceed to deal with the grounds of appeal as raised in the Memorandum of Appeal. 16. This being a first appeal, the Court is guided by the well settled principle in Selle v Associated Motor Boat Co Ltd [1968] EA 123 restated by the Court of Appeal in Gitobu Imanyara & 2 Others v Attorney General [2016] eKLR as relied by the Appellant and I will not reinvent the wheel. Whether the trial court erred in its interpretation of the Agreement of 29th August 2015. 17. Ground No. 1 above faults the trial magistrate for finding that the agreement was for the sale of land. The Appellant who was the defendant in the trial proceedings took the position that the agreement in issue was for compensation for trespass and not a land sale agreement. The agreement is dated 29th August, 2015 and was produced during the hearing before the trial court. 18. The contents of the agreement were reproduced by the trial court. The agreement reveals as follows; The agreement is titled ‘LAND DISPUTE AGREEMENT.’ It is between Mathew Ooko Ogutu (the plaintiff) who is the respondent in this appeal and Francis Otieno JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 8

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Opondo (the defendant) who is the appellant in this appeal. Clause 1 of the said Agreement describes the subject to be a commercial house which was realized to overlap into the neighbouring plot 2166 belonging to Mr. Francis Otieno Opondo. It is also indicated that the commercial house had been put up on two plots. No. 2166 and another undisclosed plot. Under Clause 3, one room valued at Kshs.400,000/= was to be surrendered and an amount of Kshs.300,000/= was to be paid in three instalments of Kshs.100,000/ =. The amount was to be paid fully latest by 5th September 2015 failure to which there shall be no further discussions on the same. It was also an express term of the agreement that the land was to be subjected to subdivision and clear boundary declared. The Agreement was witnessed by Mr. Christopher Omondi for the Defendant and Mary Awino and Lucas Ogola for the Plaintiff. 19. On the defendants claim that the agreement was for compensation for trespass the trial court noted that the agreement suggested otherwise based on its express terms which included subdivision and for a clear boundary declared. To the trial court this meant that the alleged portion encroached upon was to be hived off in favor of the plaintiff. That if the intention of the parties was only for JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 9

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compensation, then they would not have included the provision for subdivision. I agree with the above conclusion. The agreement indeed required the land to be subdivided and the boundary declared, a term that would serve no purpose if the payment was only compensation for trespass. This supports the trial court's finding that the parties intended more than a bare payment for past trespass. 20. The court notes that the trial court warned itself that a court should not rewrite the agreements of the parties. Indeed, this is the position of the law as was stated in the case of National Bank of Kenya Ltd v Pipeplastic Samkolit (K) Ltd & Another [2001] eKLR. 21. What is notable, however, is that when the parties themselves came to give evidence both parties described the payment the same way. PW1 testified in examination-inchief: "The basis of the 2nd Agreement was that a portion of his land had been encroached into by myself and I was to compensate him for the same. I was to pay him KSH. 300,000/= in installments and surrender one portion of the shop to the Defendant." 22. DW1, for his part, testified under cross-examination in materially identical terms: JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 10

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"The agreement between myself and the Plaintiff is for compensation... The money was not for sale of the land but for the encroachment. 23. Both parties agreed in court that the money was paid to compensate for the encroachment. However, the agreement still doesn't explain why the contract explicitly called for subdividing the land and marking a new boundary. From the record, during the hearing neither witness was questioned about that specific clause, which doesn't fit logically into a simple compensation arrangement. 24. The Appellant relying on Gitonga v M'Mwirichia & Another (2025) KEELC 395 (KLR), submits that a contract must be interpreted according to the parties' intention, drawn from the language used and the surrounding circumstances. While that legal principle is correct, applying it to the facts of this case does not prove the arrangement was purely about compensation. Adding a subdivision and boundary declaration clause directly contradicts the idea that the agreement was only about paying compensation for trespass. 25. Was there a valid contract? The Appellant pleaded at paragraph 15 of the amended defence dated 17/6/2016 the plaintiff never signed the agreement making it incurably defective. However, this is a contradiction of his own defence and evidence. He did not deny the existence of an JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 11

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agreement entered between him and the plaintiff. He then shifts goal posts to admit that indeed there was the term of Kshs.300,000/- which he even received the Ksh.200,000 and additionally took possession of one shop. What is clear is that both parties recognized the agreement and even performed as per their obligations except for the counter allegations on who failed on the last instalment. The defendant is therefore estopped from impeaching the agreement, it would be unconscionable for this court to allow him to do so. 26. What this court notes from the defendant’s case are that he realized that the deal did not favor him as the land was more valuable than the combined Kshs. 700,000/- the deal made – see paragraph 24 of the Amended Defence. I have read the Court of Appeal decision in Chalicha Farmers Co-operative Society Ltd v George Odhiambo & 9 Others, (supra) and I agree courts must follow strict legal principles rather than changing a deal just because it caused hardship for one party. 27. Therefore, like the trial court, I will not undo the agreement the parties freely entered into. 28. Having sustained the agreement I will now delve into Ground No. 3 where the Appellant faults the trial Court for failing to consider that the Respondent was in breach of the agreement by not completing the agreed compensation, JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 12

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thereby disentitling him from equitable relief. In other words, the Appellant asserts that the Respondent and not the Appellant, was in breach for failing to complete payment of the agreed Kshs. 300,000/=. The Appellant at paragraph 16 of the Amended Defence indeed avers: "A term and condition of the said agreement was that the last payment was to be made on 5/9/2015 which the plaintiff failed to comply with as a result of which the plaintiff failed to perform his part of contract and this no doubt caused a breach of the same." 29. The difficulty I have with the above is that though pleaded it was never carried through or made out in his testimony. The record bears that the Appellant testified as DW1. This court has reviewed the entire of DW1's testimony in both direct and his cross-examination. It reveals at no point does the Appellant assert on oath that the final instalment was withheld or otherwise not paid by the Respondent/plaintiff. What DW1's cross-examination does establish, in his own words, is this: "We did an agreement in 2015 with the Plaintiff. I received Ksh. 200,000/=... I have not refunded the sum of Ksh. 200,000/= to date. I am in possession of the land and the money.... the building is partly in my land parcel number 2166." JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 13

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30. Conversely PW1 testified, consistent with his pleaded case, that he paid Kshs. 200,000/= in two instalments and that the third was rejected in unclear circumstances. The Appellant himself admits on oath that he still holds both the money and the land. Having pleaded that the Respondent defaulted, the Appellant cannot now fault the trial court for rejecting a default he never actually testified to or proved. 31. For me where a party validly tenders performance of an obligation and it is refused by the person entitled to receive it, the tendering party is not thereby placed in breach rather the legal consequences of default fall squarely on the party who wrongfully rejects performance. The Appellant, having freely executed the Agreement and accepted substantial performance under it, cannot turn around reject the final instalment and then rely on his own refusal to allege breach on the part of the Respondent. In this regard I drew guidance from the persuasive decision in MI Technology Solutions Limited v Consolidated Bank of Kenya Limited & another; Intellect Design Arena Limited (Interested Party) (Civil Case E255 of 2023) [2025] KEHC 18540 (KLR) which though dealt with performance guarantee was instructive. The court stated thus; ‘The 1st Defendant’s call was premised on alleged non-performance. Yet the evidence demonstrates that non-performance, if any, was directly attributable to JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 14

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the 1st Defendant’s non-payment. A beneficiary cannot rely on the consequences of its own breach to justify a call on a guarantee. The call was therefore substantively unjustified’. 32. The Appellant relies on Collins v Ogango (2024) KECA 19 (KLR) to argue that a party cannot seek equitable relief while benefiting from a dispute without meeting their obligations. I must respectfully disagree with this argument the claim that the Respondent breached his obligations is unsupported on record and contradicted by the Appellant’s own testimony that he retained the money without issuing a refund. Ground 3 therefore fails, especially as the Appellant failed to substantiate his allegations on the witness stand. 33. Ground No. 2 and 4 can be considered together. The Learned trial Magistrate is faulted for granting a refund of the compensation amount, while disregarding the fact that the Respondent had already benefited from the agreement by occupying part of the Appellant's land from 2011 – 2025 earning rent of Kshs. 25,000 per month. For me this assertion would be valid if the trial court had found the plaintiff to have been in breach of the agreement. I have already noted that he was not. Moreover, the Appellant never pleaded a counterclaim for this, his Amended Defence only denies the Respondent’s rent claim; it doesn't assert any entitlement of his own. Since parties are bound by their JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 15

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pleadings, the trial court cannot be faulted for not awarding a relief that was never pleaded or proved. As the Court of Appeal held in David Sironga ole Tukai v Francis Arap Muge & 2 Others [2014] eKLR, “It is well established in our jurisdiction that the court will not grant a remedy which has not been applied for, and that it will not determine issues, which the parties have not pleaded." 34. The trial court cannot be faulted for failing to consider a relief the Appellant never sought. 35. Moreover, it is noteworthy that the figure of Kshs. 25,000/= per month relied upon in Ground 2, on the face of the record, is the very figure pleaded by the Respondent in his own Plaint as the aggregate rental value of his entire development; Kshs. 16,000/= from four residential units and Kshs. 9,000/= from three shop units only a part of which sits on the encroached portion and a claim which the trial court in fact declined to award to the Respondent. There is no evidence in the record which puts a rental figure on the encroached portion specifically and DW1 never claimed that sum for himself either. 36. Concerning ground No. 4, I have already established, the Appellant never pleaded a counterclaim before the trial court so this ground rests on a false premise. JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 16

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37. Moreover, an award of interest on a liquidated sum found to have been wrongly withheld, running from the date of filing suit to the date of payment is the exercise of the court's discretion under Section 26(1) of the Civil Procedure Act (Cap. 21, Laws of Kenya). 38. Section 26(1) of the Civil Procedure Act provides that: - “Where and in so far as a decree is for the payment of money, the court may, in the decree, order interest at such rate as the court deems reasonable to be paid on the principal sum adjudged from the date of the suit to the date of the decree in addition to any interest adjudged on such principal sum for any period before the institution of the suit, with further interest at such rate as the court deems reasonable on the aggregate sum so adjudged from the date of the decree to the date of payment or to such earlier date as the court thinks fit.” 39. The Appellant argues that the trial court failed to consider the Respondent's ongoing unlawful occupation and encroachment. I find no merit in this ground as framed. The encroachment was central to the trial court's proceedings as it formed the main subject matter of the 29 th August 2015 Agreement and was explicitly admitted by the Respondent in both the Agreement and his testimony. Rather than overlooking the issue, the trial court intentionally declined to JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 17

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disturb the parties' current possession of the land because the agreement intended to resolve the encroachment which failed as a result of the Appellant's own breach. 40. I think have no problem with the above logic. The agreement was to resolve the encroachment issue once and for all. The Appellant quarrel seems to be the pain of the refund of the Kshs.200,000/- together with interest. This is the alternative prayer sought. There is no cross appeal by the Respondent and therefore I must infer he is happy with the alternative he has been given. The Appellant stated in his own evidence that he still keeps the land and the shop and therefore the plaintiff was entitled to the refund of the Kshs.200,000/- which was received by the Appellant. There is no unjust enrichment. There is no way the defendant would have remained with everything. 41. For the foregoing reasons, I find no merit in any of the six grounds of appeal advanced by the Appellant. 42. The appeal accordingly fails and is dismissed. Each party to bear their own costs of this appeal. DATED at SIAYA this 30th Day of September 2026 HON. JUSTICE A. E. DENA JUDGE 30/09/2026 JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 18

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Judgement delivered virtually through Microsoft Teams Video Conferencing Platform in the Presence of: Mr. Mwangi for Respondent Mr. Achero for Appellant Court assistant: Victor Bwire JUDGMENT SISIAYA ELCPPEAL NO. E029 OF 2025 19

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