REPUBLIC OF KENYA
IN THE ENVIRONMENT AND LAND COURT AT EMBU
E
(Being an Appeal from the Judgment of Hon. S.K. Mutai P.M in Embu CM-ELC No. 67 of 2018 delivered on 17th April 2019)
1. The Appellant, Roy Anthony Mugo Kaugi, being aggrieved by the Judgment of the Principal Magistrate's Court at Embu (Hon. S.K. Mutai, P.M.) delivered on 17th April 2019 in Embu CM-ELC No. 67 of 2018, has appealed to this Court seeking to have that judgment set aside. In the lower court, the Respondent (then Plaintiff) had sued the Appellant (then Defendant) seeking a declaration that the Appellant had breached a Sale Agreement dated 28th February 2018 for land parcel No. GATURI/GITHIMU/3110 measuring approximately 0.81 hectares at a purchase price of Kshs. 4,000,000/=, and consequential damages as stipulated under clause 11 of the said Agreement.
2. The parties entered into a Sale Agreement on 28th February 2018 in which the Respondent agreed to purchase from the Appellant land parcel No. GATURI/GITHIMU/3110 at Kshs. 4,000,000/=. Under the terms of the Agreement, the Respondent paid a deposit of Kshs. 200,000/= upon execution. The balance was to be paid in two instalments: Kshs. 2,000,000/= on or before 6th March 2018 (to enable the Appellant clear a loan secured by a charge on the property in favour of National Bank of Kenya Ltd), and the residual Kshs. 1,800,000/= upon discharge of the title and release of completion documents.
3. Clause 11 of the Sale Agreement provided that if the transaction was not completed by reason of the vendor's default, the deposit and any other monies paid shall be refunded to the purchaser together with interest at 50% of the purchase price.
4. The Respondent's case before the trial court was that on 6th March 2018, he called the Appellant to collect the instalment of Kshs. 2,000,000/= only for the Appellant to notify him that he had decided not to proceed with the sale, and that he would refund the deposit on or before 10th March 2018. The Appellant eventually refunded the deposit of Kshs. 200,000/= on 6th April 2018, some weeks after the agreed date.
5. The Appellant's case was diametrically opposite. He denied repudiating the Agreement and averred that it was the Respondent who breached the Agreement by failing to pay Kshs. 2,000,000/= on or before 6th March 2018. The Appellant contended that time was of the essence given that the National Bank of Kenya had instructed auctioneers (Noreen Auctioneers) to sell the suit property by public auction following the Appellant's default on his loan, and was therefore compelled to seek another buyer urgently. The Appellant further averred that the suit land is agricultural land and no Land Control Board consent had been obtained, rendering the Agreement void and unenforceable, with the only remedy available to the Respondent being the refund of the deposit — which had already been made.
6. Both parties agreed to have the matter determined on the basis of their pleadings, witness statements, lists of documents, and written submissions. The trial court found in favour of the Respondent, granted prayers (a), (b) and (c) in the plaint — including a declaration that the Appellant breached the Agreement — and awarded general damages, though without specifying a figure.
7. The Appellant filed a Memorandum of Appeal dated 22nd May 2025 raising eight (8) grounds of appeal, which I shall consolidate into three principal issues for determination:
(a) Whether the Sale Agreement dated 28th February 2018 was void or unenforceable for want of Land Control Board consent;
(b) Whether the trial court erred in finding that it was the Appellant, and not the Respondent, who breached the Sale Agreement; and
(c) Whether the remedies granted by the trial court were proper and supportable in law.
8. This Court sits as a first appellate court and is enjoined to re-evaluate and re-analyse the evidence on record and arrive at its own independent conclusions, while giving due allowance to the fact that the trial court had the advantage of seeing witnesses testify. See:
In Selle & Another v Associated Motor Boat Co. Ltd & Others [1968] EA 123, the Court of Appeal (East Africa) held that an appellate court is not bound to accept the findings of the lower court but must re-examine the evidence, test it against established principles, and reach its own conclusions. This duty applies equally where the trial was conducted on documentary evidence and written statements, as is the case here.
Similarly in Ephantus Mwangi & Another v Duncan Mwangi Wambugu [1982-1988] 1 KAR 278, the Court of Appeal of Kenya affirmed this duty and the latitude an appellate court has to depart from the findings of the trial court where those findings are based on wrong legal principles or a misapprehension of the evidence.
9. The Appellant invokes Sections 6(1) and 7 of the Land Control Act (Cap. 302, Laws of Kenya). Section 6(1) provides that a controlled transaction in respect of agricultural land shall not be valid unless the Land Control Board for the area in which the land is situated has given its consent to the transaction. Section 7 of the Act specifies that an application for consent must be made within six months of the agreement.
10. It is common ground that the suit land — parcel No. GATURI/GITHIMU/3110 — is agricultural land situated within the jurisdiction of a Land Control Area. Indeed, the Appellant's own list of documents includes a Land Control Board consent dated 22nd May 2015, which was granted to charge the very same parcel to National Bank of Kenya. The Sale Agreement of 28th February 2018 was therefore a controlled transaction within the meaning of the Land Control Act and required a fresh consent before it could be valid and enforceable.
11. The trial Magistrate held, at paragraph 21 of the judgment, that the provisions of the Land Control Act did not apply because the agreement was breached barely a week after signing, even before the process of applying for consent had commenced. With respect to the learned Magistrate, this reasoning cannot be sustained. The applicability of the Land Control Act is not contingent on the temporal proximity of a breach to the date of the agreement. The requirement for consent is a statutory prerequisite that attaches to the transaction at the moment of its formation. See:
In Macharia & Another v Warugongo [2003] eKLR, the Court of Appeal held that a sale agreement for agricultural land executed without Land Control Board consent is null and void ab initio, and no rights can accrue to either party from such a transaction except for the recovery of the purchase price paid.
In Mbui v Maranya [1990] KLR 107, the Court of Appeal reiterated that the Land Control Act provisions are mandatory and their non-compliance renders a controlled transaction a nullity regardless of the parties' conduct or intentions.
12. However, the critical legal question is not simply whether the Act applies, but what consequence flows from its application given the particular circumstances of this case. The Respondent makes the important submission — and I find it compelling — that the statutory six-month window for obtaining consent runs from the date of the agreement (28th February 2018) to 28th August 2018. The agreement was repudiated and terminated well before that date lapsed. The Appellant had already sold the land to a third party by the time of the suit.
13. In Githinji v Kanyiri [2007] eKLR, the court drew a distinction between an agreement that has been rendered void by the lapse of six months without consent being obtained — in which case only the deposit is refundable — and an agreement that is terminated or repudiated before the six-month period has run, in which case the statutory nullity has not yet crystallised and the rights of the parties are determined by the terms of the contract itself and the general law of contract.
14. In this case, the repudiation occurred in early March 2018 — within six days of the agreement. The six-month period had not lapsed. Accordingly, the agreement cannot be said to have been rendered void under Section 7 of the Land Control Act at the material time. The rights of the parties must therefore be analysed under the general law of contract and the terms of the Agreement itself.
15. I note, however, that the Agreement remained an agreement to complete a controlled transaction. The absence of Land Control Board consent means it could not have been specifically enforced or used as a basis for transferring the land. Any monetary remedies must therefore be anchored in the terms of the Agreement and not in any expectation of specific performance of the transaction.
16. This is the crux of the appeal. The Appellant argues that it was the Respondent who breached the Agreement by failing to pay Kshs. 2,000,000/= on or before 6th March 2018, which was a time-of-the-essence obligation. The Respondent's case is that the Appellant repudiated the Agreement by refusing to proceed with the sale.
17. The parties did not testify viva voce and the matter was determined on documentary evidence. The Respondent's witness statement asserted that he called the Appellant on 6th March 2018 to tender the instalment payment only to be told the Appellant was withdrawing from the sale. The Respondent's statement is, however, materially vague in one significant respect: it does not state where the payment was to be effected or by what means the Respondent intended to make the payment of Kshs. 2,000,000/=.
18. The Appellant produced, as part of his list of documents, the Respondent's cooperative bank account statement (which the Respondent himself filed as a further list of documents on 1st October 2018). That statement reveals that as at 6th March 2018, the Respondent's account had a credit balance of only Kshs. 8,023/=. It was not until 16th March 2018 — ten days after the payment deadline — that the account was credited with Kshs. 7,840,000/=.
19. This is a critical piece of evidence. The Respondent bore the burden of proving that he was ready, willing and able to perform his contractual obligation of paying Kshs. 2,000,000/= by 6th March 2018. In Giella v Cassman Brown & Co Ltd [1973] EA 358, the Court of Appeal underscored the necessity of demonstrating readiness and willingness to perform in order to enforce contractual obligations. A party who has not performed — and who demonstrably lacked the financial means to perform on the due date — cannot simultaneously claim that the other party was the one in breach.
20. The Respondent did not explain the source or availability of the Kshs. 2,000,000/= prior to 6th March 2018, nor did he explain why the funds only appeared in his account ten days later. The Respondent's vague averment that he "called" the Appellant to go for the money does not constitute proof of tender or readiness to pay. A mere telephone call, unaccompanied by proof of financial capacity, does not discharge the contractual obligation of payment.
21. The trial Magistrate, at paragraph 21 of his judgment, appeared to infer that the Appellant repudiated the agreement and used the Appellant's refund of the deposit as evidence of the Appellant's breach. With respect, this inference is not supported by the evidence. The Appellant's refund of the deposit is equally consistent with an innocent party returning money it received from a defaulting buyer, seeking to avoid unjust enrichment after the transaction collapsed due to the Respondent's non-performance.
22. The trial Magistrate also made a finding — without adequate evidential basis — that there was "no pressure from the Bank" to sell the suit land. The documentary record, however, includes a 45-day Redemption Notice and a Notification of Sale by Noreen Auctioneers dated 30th November 2017, as well as a Statutory Notice dated 23rd June 2017 issued by National Bank of Kenya. These documents establish that the Appellant was under real and documented threat of losing the suit property to auction. The sale agreement with the Respondent was evidently concluded in that urgent context. The Magistrate's dismissal of these documents without adequate reasoning constitutes a misdirection.
23. I also note that the Appellant, having failed to receive the Kshs. 2,000,000/= by 6th March 2018, proceeded to sell the property to a third party. This is entirely consistent with the Appellant's account: that the Respondent was in breach and that the urgency of the auction necessitated finding another buyer. In the absence of any satisfactory counter-explanation from the Respondent, I find the Appellant's account more plausible and better supported by the documentary evidence on record.
24. On a balance of probabilities, I find that it was the Respondent who breached the Sale Agreement dated 28th February 2018 by failing to pay Kshs. 2,000,000/= on or before 6th March 2018 as stipulated. The Appellant's subsequent conduct of seeking another buyer and refunding the deposit was a lawful response to the Respondent's default.
25. Having found that it was the Respondent who breached the Agreement, the Respondent is not entitled to the relief granted by the trial court. The prayers of a declaration of breach against the Appellant and the award of general damages — which the trial Magistrate granted without even quantifying — cannot stand. The judgment of the trial court must be set aside.
26. The Appellant had already refunded the deposit of Kshs. 200,000/= to the Respondent before the suit was filed, and that sum was not claimed in the plaint. In the circumstances, and consistent with the approach in Danson Muniu Njeru v William Kiptarbei Korir & 6 Others [2014] eKLR relied upon by the Appellant, no further monetary award is due to the Respondent.
27. I am cognisant that even if I had found that the Appellant was in breach, the award of general damages by the trial court was fatally deficient for want of quantification. A court awarding damages must assess and specify the quantum; a bare finding of liability without any monetary figure is not a valid judgment for damages. See: Kivuitu v Kivuitu [1991] 2 KAR 241 and Poluwa v Chebii [2003] eKLR.
DISPOSITION
28. In the result, I find merit in this appeal. The Judgment and decree of the learned Principal Magistrate dated 17th April 2019 in Embu CM-ELC No. 67 of 2018 is hereby set aside in its entirety.
29. The Respondent's suit in the lower court is dismissed.
30. Costs of this appeal and of the suit in the lower court shall be borne by the Respondent.
DATED, DELIVERED AND SIGNED AT EMBU THIS 15TH DAY OF JUNE, 2026.
HON E.C. CHERONO
ELC JUDGE, EMBU
In the presence of;
1.M/S Njagi H/B Mr. Joe Kathungu for the Appellant
2. Respondent/Advocate-absent
3. Casty C/A
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