(Being an appeal from the Judgment and Decree of Hon. Silas Kandie, Resident Magistrate, delivered on 13th November 2024 in Mavoko CMCC No. E1067 of 2023)
A. Introduction and background
1. This appeal arises from the Respondents’ continued occupation of House No. SFB178A, also referred to in the proceedings as House No. 178, within Greenpark Estate, Athi River. Under an Agreement for Sale dated 19th March 2019, the Appellant sold the Respondents Semi-Detached Maisonette No. SD1021E (“the old house”). Shortly after taking possession in September 2019, the Respondents reported extensive cracking and other defects in the old house, whereupon the Appellant moved them, without rent, into House No. 178 while investigations and remedial works were undertaken.
2. The parties subsequently negotiated a possible sale or exchange of House No. 178 to the Respondents. Although they discussed its value, refurbishment, credit for the old house and the period for paying the balance, they did not execute an agreement for the disposition of House No. 178. Meanwhile, the Appellant engaged Engineer Waswa G. Simiyu, who prepared a Structural Integrity Audit Report dated 14th December 2020. The report attributed the cracks principally to differential settlement caused by eccentric loading of the substructure walls and weak or unstable foundation material, and recommended underpinning, construction of columns and bases, a ground beam, wall reconstruction and repair of internal cracks after structural stabilization.
3. The remedial works were undertaken. In a letter dated 13th April 2021, Engineer Waswa G. Simiyu stated that the works had been completed under his supervision in accordance with the audit report and that the old house was structurally sound and fit for habitation. The National Construction Authority, by its letter dated 10th August 2021, informed the 1st Respondent that its officers had visited the site, that the remedial works had been undertaken under the engineer’s supervision, and that the project had been reviewed in accordance with the Authority’s statutory mandate.
4. By a letter dated 25th August 2021, the Appellant informed the Respondents that the repairs were complete and required them to vacate House No. 178 within fourteen days, failing which it would charge Kshs. 3,000 per day. When they failed to vacate, the Appellant served a ninety-day eviction notice dated 21st September 2021 under section 152E of the Land Act. It thereafter instituted Machakos ELC Miscellaneous Application No. E032 of 2022, and on 7th July 2022 obtained orders directing the Respondents to surrender vacant possession and authorising their eviction. The Respondents sought a stay but eventually vacated on or about 20th August 2022 before physical eviction was undertaken.
5. The Appellant then filed Mavoko CMCC No. E1067 of 2023 seeking a declaration that the Respondents’ occupation between 8th September 2021 and 20th August 2022 was unlawful; Kshs. 1,038,000 as lost rental income or mesne profits; Kshs. 100,000 as auctioneer’s fees; Kshs. 283,796 as repair and restoration costs; interest; and costs. By the judgment delivered on 13th November 2024, the learned trial magistrate found that the Appellant had substantially complied with clause 6.6 of the Agreement for Sale but dismissed all the claims and directed each party to bear its own costs.
B. Grounds of appeal and parties’ submissions
6. The Appellant, being dissatisfied and aggrieved by part of the Judgment of Hon. Silas Kandie delivered in Mavoko CMCC No. E1067 of 2023 on 13th November 2024, preferred this appeal on the following grounds:
a) The Honourable learned trial Magistrate erred and misdirected himself in both fact and law by holding that the Appellant had not established its case on a balance of probabilities which finding was against the weight of evidence adduced during trial.
b) The learned trial Magistrate erred in law and misdirected himself in after finding that the Appellant was not in breach of the Agreement for sale proceeded to find that the Appellant had no basis for the claim for loss of rental income.
c) The Honourable learned trial Magistrate erred in both law and fact by failing to appreciate the totality of evidence before him thus proceeded to deny the Appellant’s claim for loss of rental income despite it being demonstrated that the Respondents had been notified of the soundness of their old house continued to stay at the new house for almost one whole year without lawful authority or permission.
d) The Honourable learned trial Magistrate erred in both law and fact by disregarding the Appellant’s evidence proving that it incurred auctioneer charges in a bid to secure vacant possession of the new house despite the Respondents failure to vacate the said new house.
e) The Honourable learned trial Magistrate erred in both law and fact by disregarding that the Appellant’s evidence in support of the incurred repair and restoration costs.
f) The Honourable learned trial Magistrate failed to properly evaluate, appraise and/or analyze the entire evidence on record and thereby failed to decipher the salient features of the Appellant’s case and hence arrived at a conclusion contrary to the weight of evidence.
g) The Honourable learned trial Magistrate erred and misdirected himself by relying on facts pleaded in the Respondent’s Defence without considering whether such facts had been proven by way of evidence.
h) The learned trial Magistrate erred in law and fact by failing to consider the Appellant’s submissions together with authorities filed therein.
7. The Appellant submitted that, under Gitobu Imanyara & 2 Others v Attorney General [2016] eKLR, which restated Selle & Another v Associated Motor Boat Company Limited & Others [1968] EA 123, this Court must reconsider the evidence and reach its own conclusions. It argued that the Respondents’ licence to occupy House No. 178 was limited to the period required to repair the old house; once Engineer Waswa G. Simiyu and the National Construction Authority confirmed completion and the Respondents were notified, the basis of their occupation ended. According to the Appellant, it was contradictory for the trial court to find that clause 6.6 had not been breached and yet deny compensation because the Appellant had initially delivered a defective house.
8. On the claim for occupation, the Appellant relied on section 2 of the Civil Procedure Act, Order 21 rule 13 of the Civil Procedure Rules, Attorney General v Halal Meat Products Limited [2016] eKLR, Rajan Shah t/a Rajan S. Shah & Partners v Bipin P. Shah [2016] KEHC 1880 (KLR) and Muriithi v Kuria [2024] KEELC 5607 (KLR), submitting that mesne profits compensate an owner for wrongful deprivation of property and may be measured by fair market rent. It contended that its Kshs. 3,000 daily rate was pleaded and supported by its witness’s evidence and by the ProLand Realtors Limited valuation report, which recorded that similar bungalows fetched Kshs. 65,000 to Kshs. 70,000 monthly in January 2021.
9. Regarding the auctioneer’s fees, the Appellant relied on rules 5 and 7 of the Auctioneers Rules, its letter of instruction dated 9th December 2021, Moran Auctioneers’ invoice dated 18th January 2022 and the RTGS payment record. It argued that the auctioneer became entitled to fees upon receiving and acting upon instructions, notwithstanding that the attempted eviction was resisted. On repairs, it relied on purchase orders, invoices and payment records and cited David Bagine v Martin Bundi [1997] eKLR, Associated Motors Limited v Blue Sea Services Limited [2019] eKLR and Wilfred Irungu Ndirangu v CMC Motor Group Limited [2012] eKLR, submitting that the special damages were both pleaded and strictly proved. It finally sought costs under section 27 of the Civil Procedure Act and Orix Oil (Kenya) Limited v Paul Kabeu & 2 Others [2014] eKLR.
10. The Respondents opposed the appeal. They submitted that their occupation of House No. 178 was not a tenancy but temporary accommodation necessitated by the Appellant’s failure to deliver a structurally sound house; no rent, definite occupation period or other tenancy terms were agreed. They argued that clause 6.6 required completion to the reasonable satisfaction of the Appellant’s architect, yet the Appellant’s witness admitted that no architect was engaged and no architectural certification was issued. In their view, Engineer Waswa G. Simiyu and the National Construction Authority could not replace the architect contemplated by the contract. They relied on Fidelity Commercial Bank Limited v Kenya Grange Vehicle Industries Limited [2017] eKLR for the objective interpretation of written agreements and the prohibition against altering clear terms by extrinsic evidence.
11. The Respondents further submitted that their occupation could not be treated as wrongful from 8th September 2021 and that, at the earliest, it became unlawful after the possession order of 7th July 2022 or after expiry of the temporary stay. They contended that the claim for Kshs. 1,038,000 was a claim for mesne profits in the nature of special damages and had not been strictly proved. They relied on Capital Fish Kenya Limited v Kenya Power & Lighting Company Limited [2016] eKLR, Zipporah Muthoni Ndungu v Kenya Industrial Estates Limited & Another [2021] eKLR, Saad Otieno v James Muga Ogoda [2021] KEELC 3280 (KLR) and Karanja Mbugua & Another v Marybin Holding Company Limited [2014] KEELC 378 (KLR). They argued that the ProLand valuation was prepared for sale negotiations, not rent assessment; that its maker did not testify; and that it supported, at most, Kshs. 65,000 to Kshs. 70,000 monthly rather than Kshs. 3,000 daily.
12. The Respondents also challenged the alleged lost sale to Parkishon Enterprise Limited because the letter of offer was unsigned, no acceptance or deposit was proved, and no evidence showed that they had refused access for inspection. On auctioneer’s charges, they relied on Eldoret Travel Agency Limited v Samuel Kandie & Another [2010] eKLR, submitting that the Appellant attempted eviction before obtaining a court order and could not recover the cost of an unlawful and unsuccessful self-help exercise. As to repairs, they submitted that the documents might show expenditure but did not prove that they caused the defects; there was no condition report before occupation, no joint exit inspection and no evidence distinguishing new damage from pre-existing faults, construction defects, age or fair wear and tear. They therefore urged the Court to dismiss the appeal with costs.
C. Duty of the first appellate court and issues for determination
13. Under section 78 of the Civil Procedure Act, this Court must reconsider and evaluate the evidence and draw its own conclusions, while allowing for the fact that the trial court saw and heard the witnesses. That principle is settled in Selle & Another v Associated Motor Boat Company Limited & Others [1968] EA 123, Peters v Sunday Post Limited [1958] EA 424 and Gitobu Imanyara & 2 Others v Attorney General [2016] eKLR. Nevertheless, interference with factual findings is warranted only where they are based on no evidence, proceed from a material misapprehension of the evidence, or result from application of an incorrect principle. The legal burden remained upon the Appellant under sections 107, 108 and 109 of the Evidence Act to prove each claimed relief on a balance of probabilities.
Issues for Determination
14. Having considered the Record of Appeal, the grounds set out in the Memorandum of Appeal and the parties’ respective submissions, the following issues arise for determination:
i) whether the trial court properly interpreted clause 6.6 of the Agreement for Sale; whether and from what date the Respondents’ occupation of House No. 178 became wrongful;
ii) whether the Appellant proved Kshs. 1,038,000 as mesne profits or lost rental income;
iii) whether the claims for auctioneer’s fees and repair costs were proved and the appropriate orders on interest and costs.
D. Interpretation and performance of clause 6.6
15. The parties entered into a written agreement and did not plead fraud, coercion, mistake or illegality in its formation. In National Bank of Kenya Limited v Pipeplastic Samkolit (K) Limited & Another [2001] KLR 112, the Court of Appeal held that courts do not rewrite contracts and that parties are bound by their bargain unless coercion, fraud or undue influence is pleaded and proved. Similarly, Fidelity Commercial Bank Limited v Kenya Grange Vehicle Industries Limited [2017] eKLR affirmed that contractual interpretation begins with the instrument itself and gives objective effect to the parties’ expressed intention.
16. Clause 6.6 required the Appellant, at its own cost, to rectify defects notified within the defects-liability period and contemplated completion to the reasonable satisfaction of the vendor’s architect. If the vendor failed to complete the works within a reasonable period after receiving a certified defects schedule, the purchasers could undertake the works through approved workmen and demand reimbursement. The clause did not expressly prescribe a particular form of architectural certificate as a condition precedent to every subsequent right, although satisfaction by the vendor’s architect formed part of the agreed quality-control process.
17. The defects were structural and required engineering, rather than merely aesthetic, expertise. Engineer Waswa G. Simiyu investigated the building, identified differential settlement caused by eccentric loading and weak foundation material, prescribed underpinning and a new load-bearing system, and supervised the remedial works. The progress records show excavation, propping, construction of bases, columns and beams, reconstruction, backfilling and finishing. By the letter dated 13th April 2021, the engineer confirmed that the works had been completed according to the audit report and that the building was structurally sound and fit for habitation; the National Construction Authority’s letter of 10th August 2021 corroborated that site visits had occurred and that the works had been undertaken under the engineer’s supervision.
18. The Respondents’ safety concerns were understandable, particularly given the seriousness of the original defects and the absence of formal architectural certification. However, their own complaint drew the National Construction Authority into the matter, they received the Authority’s response, and they thereafter concentrated on negotiations to acquire House No. 178. Those negotiations did not produce an enforceable disposition of land. Section 3(3) of the Law of Contract Act requires a contract for disposition of an interest in land to be written, signed by the parties and attested; as the Court of Appeal confirmed in Neptune Credit Management Limited & Another v Jani & Another [2022] KECA 619 (KLR), non-compliance is fatal to enforceability. The Respondents could not therefore acquire an indefinite right to remain in House No. 178 merely because negotiations had reached an advanced stage.
19. The Appellant bore the cost of the structural works and alternative accommodation, while the evidence showed that the old house was later let by the Respondents for office use. That later use was not conclusive proof of residential habitability, but it was inconsistent with an assertion that the building remained entirely unusable. On the evidence as a whole, the Appellant substantially performed its obligation to remediate the structural defects. The absence of a formal architect’s certificate was a departure from the contractual quality-control language, but it did not authorise perpetual occupation of a separate house after the structural engineer certified completion, the National Construction Authority responded to the Respondents’ complaint and a competent court ordered surrender of possession.
20. The trial court was therefore correct in concluding that the Appellant substantially complied with clause 6.6, but it fell into error when it subsequently treated the Appellant as disentitled to all compensation merely because it had originally supplied a defective house. That reasoning failed to distinguish the Respondents’ initially lawful occupation from any subsequent period of wrongful retention.
E. Commencement of wrongful occupation
21. Section 2 of the Civil Procedure Act defines mesne profits as those profits which a person in wrongful possession actually received or might with ordinary diligence have received, together with interest, but excluding profits attributable to improvements made by the person in possession. Wrongful possession is therefore indispensable. In Attorney General v Halal Meat Products Limited [2016] eKLR, the Court of Appeal held that a person wrongfully deprived of property is entitled to compensation for the period of wrongful occupation. In Mistry Valji v Janendra Raichand & 2 Others [2016] KECA 538 (KLR), the Court of Appeal affirmed that mesne profits arise from wrongful possession and are ordinarily measured by reasonable rental value.
22. The Respondents entered House No. 178 with the Appellant’s consent and initially occupied it lawfully as temporary licensees. No tenancy, rent or fixed period was agreed, but the licence was incidental to remediation of the old house and, for a period, to the contemplated swap. It was not perpetual. The Appellant’s letter of 25th August 2021 gave fourteen days’ notice and purported to impose a daily charge thereafter. That unilateral letter could terminate permission upon reasonable notice but could not, without agreement, create a tenancy or contractual obligation to pay Kshs. 3,000 per day.
23. The Appellant subsequently served the formal ninety-day eviction notice dated 21st September 2021 under section 152E of the Land Act, thereby allowing the Respondents until approximately 21st December 2021 to surrender possession. It would be inconsistent to treat them as trespassers from 8th September 2021 while simultaneously granting a later statutory notice period. Their occupation therefore became wrongful upon expiry of the ninety-day notice, namely on 22nd December 2021, and continued until they vacated on 20th August 2022.
24. The ruling in Machakos ELC Miscellaneous Application No. E032 of 2022 determined that the Respondents had no continuing right to House No. 178 and ordered surrender and eviction. The plea of res judicata under section 7 of the Civil Procedure Act does not bar the present monetary claims because the earlier proceedings determined possession but did not assess mesne profits, auctioneer’s fees or restoration costs. The finding on possession binds the parties, while the distinct compensation claims remained open for adjudication.
F. Mesne profits
25. Mesne profits are in the nature of special damages and must be specifically pleaded and proved. That principle is settled by David Bagine v Martin Bundi [1997] eKLR, Capital Fish Kenya Limited v Kenya Power & Lighting Company Limited [2016] eKLR and Unifresh Exotics (K) Limited v Kaoyeni Enterprises Limited [2025] KECA 872 (KLR). Unlike the claim considered in Unifresh Exotics (K) Limited v Kaoyeni Enterprises Limited [2025] KECA 872 (KLR), the Appellant pleaded the amount, rate and period with sufficient specificity; the issue is whether Kshs. 3,000 per day was proved.
26. No lease or rental history showed that House No. 178 generated Kshs. 90,000 monthly, no estate agent or valuation expert testified in support of that figure, and the Appellant’s witness admitted that the house had been vacant and that no specific rental valuation had been commissioned for the claimed period. The unsigned letter of offer to Parkishon Enterprise Limited concerned a proposed sale for Kshs. 21.5 million, not rental income; there was no signed acceptance, deposit or testimony from the proposed buyer, and no proof that the sale failed because the Respondents refused inspection or vacant possession. The Appellant therefore did not prove its unilateral Kshs. 3,000 daily rate.
27. Nevertheless, the record contained independent evidence from which reasonable rental value could be assessed. The ProLand Realtors Limited valuation report dated January 2021, produced by the Respondents and admitted in evidence, related specifically to House No. 178 and recorded that similar bungalows within Greenpark Estate were letting for Kshs. 65,000 to Kshs. 70,000 monthly. Although prepared primarily for sale negotiations and eleven months before wrongful possession commenced, it was the only objective rental evidence and the trial court itself relied upon it when comparing the Appellant’s Kshs. 90,000 monthly claim.
28. In Mistry Valji v Janendra Raichand & 2 Others [2016] KECA 538 (KLR), the Court of Appeal approved reasonable rent as the proper measure of ordinary mesne profits. A claimant should not be denied all compensation merely because exact quantification is difficult where the record supplies a rational evidential basis, but the court must adopt a conservative figure to avoid speculation. The lower end of the admitted range, Kshs. 65,000 monthly, is appropriate.
29. The compensable period from 22nd December 2021 to 20th August 2022 is approximately eight months. Mesne profits are consequently assessed at Kshs. 520,000, calculated as Kshs. 65,000 multiplied by eight months. This amount does not enforce the unilateral term in the letter dated 25th August 2021; it is an independent judicial assessment of reasonable rental value under section 2 of the Civil Procedure Act and Order 21 rule 13 of the Civil Procedure Rules. The trial magistrate therefore erred in denying all mesne profits, although the Appellant did not prove the full Kshs. 1,038,000 claimed.
G. Auctioneer’s fees
30. The Appellant specifically pleaded Kshs. 100,000 and produced a letter dated 9th December 2021 instructing Moran Auctioneers, an invoice dated 18th January 2022 and an RTGS record reflecting payment of Kshs. 95,000. Although an auctioneer may undertake chargeable preparatory work without completing the ultimate exercise, the question is not merely whether the auctioneer earned fees from the Appellant but whether that expenditure was a lawful, reasonable and necessary loss recoverable from the Respondents.
31. The instructions and payment predated the possession order of 7th July 2022. The ninety-day notice under section 152E of the Land Act did not itself authorise forcible removal by a private auctioneer, while sections 152E to 152I of the Land Act impose safeguards against arbitrary eviction. Eldoret Travel Agency Limited v Samuel Kandie & Another [2010] eKLR correctly states the general principle that forcible eviction should not occur without lawful process. Rules 5 and 7 of the Auctioneers Rules regulate an auctioneer’s entitlement and responsibility for charges but do not transform every private enforcement expense into damages recoverable from the opposing party.
32. Muriithi v Kuria [2024] KEELC 5607 (KLR) is distinguishable because the auctioneer there implemented an existing eviction order, actual eviction took place and payment was proved in an undefended claim. In the present case, no court order existed when the auctioneer was instructed, the auctioneer did not evict the Respondents, and the Appellant’s witness admitted that they ultimately vacated without an auctioneer’s participation. The expenditure was not proved to be a reasonable consequence of lawful enforcement, and the trial court correctly rejected it.
H. Repair and restoration costs
33. The Kshs. 283,796 repair claim was specifically pleaded and supported by invoices, purchase orders and payment records relating to painting, bathroom and shower work, tiling, grating, manholes, gulley traps, a dhobi sink, plastering, gutters, cornices and vents. Those documents could establish expenditure, but the Appellant also had to prove that the expenditure resulted from damage caused by the Respondents rather than pre-existing defects, age, construction deficiencies, deferred maintenance, ordinary wear and tear or voluntary renovation for resale.
34. David Bagine v Martin Bundi [1997] eKLR establishes that the claimant must prove the actual loss rather than merely place figures before the court. Simba Colt Motors Limited v James Gitahi Mwangi [2015] KECA 385 (KLR) similarly requires each head of special damages to be individually examined and proved. Proof of payment does not dispense with proof of causation.
35. House No. 178 was not newly constructed for the Respondents and had previously been used for accommodation or as a guest house. During occupation, the Respondents complained about leaking gutters, dampness, worn tiles, old shower fittings, mould, plumbing, ceilings, cornices, paintwork, the underground water tank and other signs of age or disrepair; the Appellant’s witness acknowledged those complaints, and several items later repaired corresponded directly with them. No signed condition report existed at entry, no joint exit inspection was conducted, no contemporary schedule distinguished earlier defects from new damage, and no contractor or expert connected the expenditure to any act or omission by the Respondents. The documents also did not exclude commercial upgrading in preparation for sale.
36. The Court of Appeal’s decision in Yusuf Mohammed Jiwa t/a Jiwa Properties & Another v Mwangi & 2 Others [2024] KECA 38 (KLR) confirms that special damages must be specifically pleaded and strictly proved, with the degree of particularity depending upon the circumstances; it does not remove the requirement to prove causation. The Appellant proved expenditure but not the Respondents’ liability for it. The trial court therefore properly dismissed this claim.
I. Sufficiency of the trial judgment
37. Order 21 rule 4 of the Civil Procedure Rules requires a judgment to contain a concise statement of the case, the points for determination, the decision and reasons. The impugned judgment identified the issues, summarized the evidence and submissions and gave reasons on each claimed relief. Its reasoning was not wholly consistent because it found substantial contractual performance yet denied all compensation for subsequent wrongful occupation. That error warrants appellate correction but does not establish that the trial magistrate ignored the parties’ evidence or submissions, and his conclusions on auctioneer’s fees and repairs were properly grounded in the record.
J. Interest and costs
38. Section 26 of the Civil Procedure Act governs interest. Mesne profits are assessed damages whose quantified amount crystallises upon judicial assessment. The principle in Mukisa Biscuit Manufacturing Company Limited v West End Distributors Limited [1970] EA 469 and Orix Oil (Kenya) Limited v Paul Kabeu & 2 Others [2014] eKLR distinguishes an ascertained liquidated sum, on which interest may run from filing, from damages requiring assessment, on which interest ordinarily runs from judgment. The award of Kshs. 520,000 shall therefore attract interest at court rates from 13th November 2024, being the date of the subordinate court’s judgment, until payment in full.
39. Under section 27 of the Civil Procedure Act, costs are discretionary but ordinarily follow the event. The Supreme Court explained in Jasbir Singh Rai & 3 Others v Tarlochan Singh Rai Estate & 4 Others [2013] eKLR that the rule is not absolute and that the court must consider the parties’ conduct, the nature of the litigation and the degree of success. The Appellant has succeeded on the central issue that continued occupation eventually became wrongful and compensable, but has failed to prove more than half of the mesne profits sought and has wholly failed on the auctioneer and repair claims. It should recover one-half of its taxed costs in the subordinate court, while each party should bear its own costs of the appeal.
K. Disposition
40. For the foregoing reasons, the appeal succeeds in part and the Court makes the following orders:
a. The order dismissing the Appellant’s suit in its entirety is set aside.
b. A declaration is issued that the Respondents’ occupation of House No. SFB178A, Greenpark Estate, became wrongful upon expiry of the ninety-day notice, namely on 22nd December 2021, and continued until surrender of possession on 20th August 2022.
c. Judgment is entered for the Appellant against the Respondents jointly and severally for Kshs. 520,000 as mesne profits.
d. The claim for Kshs. 1,038,000 is dismissed to the extent that it exceeds the award of Kshs. 520,000.
e. The claim for Kshs. 100,000 as auctioneer’s fees is dismissed.
f. The claim for Kshs. 283,796 as repair and restoration costs is dismissed.
g. The award of Kshs. 520,000 shall attract interest at court rates from 13th November 2024 until payment in full.
h. The Appellant shall recover one-half of its taxed costs in Mavoko CMCC No. E1067 of 2023.
i. Each party shall bear its own costs of this appeal.
41. Orders accordingly.
READ AND PUBLISHED THIS 28TH AUGUST 2026 IN THE PRESENCE OF:
BEFORE HON JOYCE GANDANI JUDGE
A. Introduction and background
1. This appeal arises from the Respondents’ continued occupation of House No. SFB178A, also referred to in the proceedings as House No. 178, within Greenpark Estate, Athi River. Under an Agreement for Sale dated 19th March 2019, the Appellant sold the Respondents Semi-Detached Maisonette No. SD1021E (“the old house”). Shortly after taking possession in September 2019, the Respondents reported extensive cracking and other defects in the old house, whereupon the Appellant moved them, without rent, into House No. 178 while investigations and remedial works were undertaken.
2. The parties subsequently negotiated a possible sale or exchange of House No. 178 to the Respondents. Although they discussed its value, refurbishment, credit for the old house and the period for paying the balance, they did not execute an agreement for the disposition of House No. 178. Meanwhile, the Appellant engaged Engineer Waswa G. Simiyu, who prepared a Structural Integrity Audit Report dated 14th December 2020. The report attributed the cracks principally to differential settlement caused by eccentric loading of the substructure walls and weak or unstable foundation material, and recommended underpinning, construction of columns and bases, a ground beam, wall reconstruction and repair of internal cracks after structural stabilization.
3. The remedial works were undertaken. In a letter dated 13th April 2021, Engineer Waswa G. Simiyu stated that the works had been completed under his supervision in accordance with the audit report and that the old house was structurally sound and fit for habitation. The National Construction Authority, by its letter dated 10th August 2021, informed the 1st Respondent that its officers had visited the site, that the remedial works had been undertaken under the engineer’s supervision, and that the project had been reviewed in accordance with the Authority’s statutory mandate.
4. By a letter dated 25th August 2021, the Appellant informed the Respondents that the repairs were complete and required them to vacate House No. 178 within fourteen days, failing which it would charge Kshs. 3,000 per day. When they failed to vacate, the Appellant served a ninety-day eviction notice dated 21st September 2021 under section 152E of the Land Act. It thereafter instituted Machakos ELC Miscellaneous Application No. E032 of 2022, and on 7th July 2022 obtained orders directing the Respondents to surrender vacant possession and authorising their eviction. The Respondents sought a stay but eventually vacated on or about 20th August 2022 before physical eviction was undertaken.
5. The Appellant then filed Mavoko CMCC No. E1067 of 2023 seeking a declaration that the Respondents’ occupation between 8th September 2021 and 20th August 2022 was unlawful; Kshs. 1,038,000 as lost rental income or mesne profits; Kshs. 100,000 as auctioneer’s fees; Kshs. 283,796 as repair and restoration costs; interest; and costs. By the judgment delivered on 13th November 2024, the learned trial magistrate found that the Appellant had substantially complied with clause 6.6 of the Agreement for Sale but dismissed all the claims and directed each party to bear its own costs.
B. Grounds of appeal and parties’ submissions
6. The Appellant, being dissatisfied and aggrieved by part of the Judgment of Hon. Silas Kandie delivered in Mavoko CMCC No. E1067 of 2023 on 13th November 2024, preferred this appeal on the following grounds:
a) The Honourable learned trial Magistrate erred and misdirected himself in both fact and law by holding that the Appellant had not established its case on a balance of probabilities which finding was against the weight of evidence adduced during trial.
b) The learned trial Magistrate erred in law and misdirected himself in after finding that the Appellant was not in breach of the Agreement for sale proceeded to find that the Appellant had no basis for the claim for loss of rental income.
c) The Honourable learned trial Magistrate erred in both law and fact by failing to appreciate the totality of evidence before him thus proceeded to deny the Appellant’s claim for loss of rental income despite it being demonstrated that the Respondents had been notified of the soundness of their old house continued to stay at the new house for almost one whole year without lawful authority or permission.
d) The Honourable learned trial Magistrate erred in both law and fact by disregarding the Appellant’s evidence proving that it incurred auctioneer charges in a bid to secure vacant possession of the new house despite the Respondents failure to vacate the said new house.
e) The Honourable learned trial Magistrate erred in both law and fact by disregarding that the Appellant’s evidence in support of the incurred repair and restoration costs.
f) The Honourable learned trial Magistrate failed to properly evaluate, appraise and/or analyze the entire evidence on record and thereby failed to decipher the salient features of the Appellant’s case and hence arrived at a conclusion contrary to the weight of evidence.
g) The Honourable learned trial Magistrate erred and misdirected himself by relying on facts pleaded in the Respondent’s Defence without considering whether such facts had been proven by way of evidence.
h) The learned trial Magistrate erred in law and fact by failing to consider the Appellant’s submissions together with authorities filed therein.
7. The Appellant submitted that, under Gitobu Imanyara & 2 Others v Attorney General [2016] eKLR, which restated Selle & Another v Associated Motor Boat Company Limited & Others [1968] EA 123, this Court must reconsider the evidence and reach its own conclusions. It argued that the Respondents’ licence to occupy House No. 178 was limited to the period required to repair the old house; once Engineer Waswa G. Simiyu and the National Construction Authority confirmed completion and the Respondents were notified, the basis of their occupation ended. According to the Appellant, it was contradictory for the trial court to find that clause 6.6 had not been breached and yet deny compensation because the Appellant had initially delivered a defective house.
8. On the claim for occupation, the Appellant relied on section 2 of the Civil Procedure Act, Order 21 rule 13 of the Civil Procedure Rules, Attorney General v Halal Meat Products Limited [2016] eKLR, Rajan Shah t/a Rajan S. Shah & Partners v Bipin P. Shah [2016] KEHC 1880 (KLR) and Muriithi v Kuria [2024] KEELC 5607 (KLR), submitting that mesne profits compensate an owner for wrongful deprivation of property and may be measured by fair market rent. It contended that its Kshs. 3,000 daily rate was pleaded and supported by its witness’s evidence and by the ProLand Realtors Limited valuation report, which recorded that similar bungalows fetched Kshs. 65,000 to Kshs. 70,000 monthly in January 2021.
9. Regarding the auctioneer’s fees, the Appellant relied on rules 5 and 7 of the Auctioneers Rules, its letter of instruction dated 9th December 2021, Moran Auctioneers’ invoice dated 18th January 2022 and the RTGS payment record. It argued that the auctioneer became entitled to fees upon receiving and acting upon instructions, notwithstanding that the attempted eviction was resisted. On repairs, it relied on purchase orders, invoices and payment records and cited David Bagine v Martin Bundi [1997] eKLR, Associated Motors Limited v Blue Sea Services Limited [2019] eKLR and Wilfred Irungu Ndirangu v CMC Motor Group Limited [2012] eKLR, submitting that the special damages were both pleaded and strictly proved. It finally sought costs under section 27 of the Civil Procedure Act and Orix Oil (Kenya) Limited v Paul Kabeu & 2 Others [2014] eKLR.
10. The Respondents opposed the appeal. They submitted that their occupation of House No. 178 was not a tenancy but temporary accommodation necessitated by the Appellant’s failure to deliver a structurally sound house; no rent, definite occupation period or other tenancy terms were agreed. They argued that clause 6.6 required completion to the reasonable satisfaction of the Appellant’s architect, yet the Appellant’s witness admitted that no architect was engaged and no architectural certification was issued. In their view, Engineer Waswa G. Simiyu and the National Construction Authority could not replace the architect contemplated by the contract. They relied on Fidelity Commercial Bank Limited v Kenya Grange Vehicle Industries Limited [2017] eKLR for the objective interpretation of written agreements and the prohibition against altering clear terms by extrinsic evidence.
11. The Respondents further submitted that their occupation could not be treated as wrongful from 8th September 2021 and that, at the earliest, it became unlawful after the possession order of 7th July 2022 or after expiry of the temporary stay. They contended that the claim for Kshs. 1,038,000 was a claim for mesne profits in the nature of special damages and had not been strictly proved. They relied on Capital Fish Kenya Limited v Kenya Power & Lighting Company Limited [2016] eKLR, Zipporah Muthoni Ndungu v Kenya Industrial Estates Limited & Another [2021] eKLR, Saad Otieno v James Muga Ogoda [2021] KEELC 3280 (KLR) and Karanja Mbugua & Another v Marybin Holding Company Limited [2014] KEELC 378 (KLR). They argued that the ProLand valuation was prepared for sale negotiations, not rent assessment; that its maker did not testify; and that it supported, at most, Kshs. 65,000 to Kshs. 70,000 monthly rather than Kshs. 3,000 daily.
12. The Respondents also challenged the alleged lost sale to Parkishon Enterprise Limited because the letter of offer was unsigned, no acceptance or deposit was proved, and no evidence showed that they had refused access for inspection. On auctioneer’s charges, they relied on Eldoret Travel Agency Limited v Samuel Kandie & Another [2010] eKLR, submitting that the Appellant attempted eviction before obtaining a court order and could not recover the cost of an unlawful and unsuccessful self-help exercise. As to repairs, they submitted that the documents might show expenditure but did not prove that they caused the defects; there was no condition report before occupation, no joint exit inspection and no evidence distinguishing new damage from pre-existing faults, construction defects, age or fair wear and tear. They therefore urged the Court to dismiss the appeal with costs.
C. Duty of the first appellate court and issues for determination
13. Under section 78 of the Civil Procedure Act, this Court must reconsider and evaluate the evidence and draw its own conclusions, while allowing for the fact that the trial court saw and heard the witnesses. That principle is settled in Selle & Another v Associated Motor Boat Company Limited & Others [1968] EA 123, Peters v Sunday Post Limited [1958] EA 424 and Gitobu Imanyara & 2 Others v Attorney General [2016] eKLR. Nevertheless, interference with factual findings is warranted only where they are based on no evidence, proceed from a material misapprehension of the evidence, or result from application of an incorrect principle. The legal burden remained upon the Appellant under sections 107, 108 and 109 of the Evidence Act to prove each claimed relief on a balance of probabilities.
Issues for Determination
14. Having considered the Record of Appeal, the grounds set out in the Memorandum of Appeal and the parties’ respective submissions, the following issues arise for determination:
i) whether the trial court properly interpreted clause 6.6 of the Agreement for Sale; whether and from what date the Respondents’ occupation of House No. 178 became wrongful;
ii) whether the Appellant proved Kshs. 1,038,000 as mesne profits or lost rental income;
iii) whether the claims for auctioneer’s fees and repair costs were proved and the appropriate orders on interest and costs.
D. Interpretation and performance of clause 6.6
15. The parties entered into a written agreement and did not plead fraud, coercion, mistake or illegality in its formation. In National Bank of Kenya Limited v Pipeplastic Samkolit (K) Limited & Another [2001] KLR 112, the Court of Appeal held that courts do not rewrite contracts and that parties are bound by their bargain unless coercion, fraud or undue influence is pleaded and proved. Similarly, Fidelity Commercial Bank Limited v Kenya Grange Vehicle Industries Limited [2017] eKLR affirmed that contractual interpretation begins with the instrument itself and gives objective effect to the parties’ expressed intention.
16. Clause 6.6 required the Appellant, at its own cost, to rectify defects notified within the defects-liability period and contemplated completion to the reasonable satisfaction of the vendor’s architect. If the vendor failed to complete the works within a reasonable period after receiving a certified defects schedule, the purchasers could undertake the works through approved workmen and demand reimbursement. The clause did not expressly prescribe a particular form of architectural certificate as a condition precedent to every subsequent right, although satisfaction by the vendor’s architect formed part of the agreed quality-control process.
17. The defects were structural and required engineering, rather than merely aesthetic, expertise. Engineer Waswa G. Simiyu investigated the building, identified differential settlement caused by eccentric loading and weak foundation material, prescribed underpinning and a new load-bearing system, and supervised the remedial works. The progress records show excavation, propping, construction of bases, columns and beams, reconstruction, backfilling and finishing. By the letter dated 13th April 2021, the engineer confirmed that the works had been completed according to the audit report and that the building was structurally sound and fit for habitation; the National Construction Authority’s letter of 10th August 2021 corroborated that site visits had occurred and that the works had been undertaken under the engineer’s supervision.
18. The Respondents’ safety concerns were understandable, particularly given the seriousness of the original defects and the absence of formal architectural certification. However, their own complaint drew the National Construction Authority into the matter, they received the Authority’s response, and they thereafter concentrated on negotiations to acquire House No. 178. Those negotiations did not produce an enforceable disposition of land. Section 3(3) of the Law of Contract Act requires a contract for disposition of an interest in land to be written, signed by the parties and attested; as the Court of Appeal confirmed in Neptune Credit Management Limited & Another v Jani & Another [2022] KECA 619 (KLR), non-compliance is fatal to enforceability. The Respondents could not therefore acquire an indefinite right to remain in House No. 178 merely because negotiations had reached an advanced stage.
19. The Appellant bore the cost of the structural works and alternative accommodation, while the evidence showed that the old house was later let by the Respondents for office use. That later use was not conclusive proof of residential habitability, but it was inconsistent with an assertion that the building remained entirely unusable. On the evidence as a whole, the Appellant substantially performed its obligation to remediate the structural defects. The absence of a formal architect’s certificate was a departure from the contractual quality-control language, but it did not authorise perpetual occupation of a separate house after the structural engineer certified completion, the National Construction Authority responded to the Respondents’ complaint and a competent court ordered surrender of possession.
20. The trial court was therefore correct in concluding that the Appellant substantially complied with clause 6.6, but it fell into error when it subsequently treated the Appellant as disentitled to all compensation merely because it had originally supplied a defective house. That reasoning failed to distinguish the Respondents’ initially lawful occupation from any subsequent period of wrongful retention.
E. Commencement of wrongful occupation
21. Section 2 of the Civil Procedure Act defines mesne profits as those profits which a person in wrongful possession actually received or might with ordinary diligence have received, together with interest, but excluding profits attributable to improvements made by the person in possession. Wrongful possession is therefore indispensable. In Attorney General v Halal Meat Products Limited [2016] eKLR, the Court of Appeal held that a person wrongfully deprived of property is entitled to compensation for the period of wrongful occupation. In Mistry Valji v Janendra Raichand & 2 Others [2016] KECA 538 (KLR), the Court of Appeal affirmed that mesne profits arise from wrongful possession and are ordinarily measured by reasonable rental value.
22. The Respondents entered House No. 178 with the Appellant’s consent and initially occupied it lawfully as temporary licensees. No tenancy, rent or fixed period was agreed, but the licence was incidental to remediation of the old house and, for a period, to the contemplated swap. It was not perpetual. The Appellant’s letter of 25th August 2021 gave fourteen days’ notice and purported to impose a daily charge thereafter. That unilateral letter could terminate permission upon reasonable notice but could not, without agreement, create a tenancy or contractual obligation to pay Kshs. 3,000 per day.
23. The Appellant subsequently served the formal ninety-day eviction notice dated 21st September 2021 under section 152E of the Land Act, thereby allowing the Respondents until approximately 21st December 2021 to surrender possession. It would be inconsistent to treat them as trespassers from 8th September 2021 while simultaneously granting a later statutory notice period. Their occupation therefore became wrongful upon expiry of the ninety-day notice, namely on 22nd December 2021, and continued until they vacated on 20th August 2022.
24. The ruling in Machakos ELC Miscellaneous Application No. E032 of 2022 determined that the Respondents had no continuing right to House No. 178 and ordered surrender and eviction. The plea of res judicata under section 7 of the Civil Procedure Act does not bar the present monetary claims because the earlier proceedings determined possession but did not assess mesne profits, auctioneer’s fees or restoration costs. The finding on possession binds the parties, while the distinct compensation claims remained open for adjudication.
F. Mesne profits
25. Mesne profits are in the nature of special damages and must be specifically pleaded and proved. That principle is settled by David Bagine v Martin Bundi [1997] eKLR, Capital Fish Kenya Limited v Kenya Power & Lighting Company Limited [2016] eKLR and Unifresh Exotics (K) Limited v Kaoyeni Enterprises Limited [2025] KECA 872 (KLR). Unlike the claim considered in Unifresh Exotics (K) Limited v Kaoyeni Enterprises Limited [2025] KECA 872 (KLR), the Appellant pleaded the amount, rate and period with sufficient specificity; the issue is whether Kshs. 3,000 per day was proved.
26. No lease or rental history showed that House No. 178 generated Kshs. 90,000 monthly, no estate agent or valuation expert testified in support of that figure, and the Appellant’s witness admitted that the house had been vacant and that no specific rental valuation had been commissioned for the claimed period. The unsigned letter of offer to Parkishon Enterprise Limited concerned a proposed sale for Kshs. 21.5 million, not rental income; there was no signed acceptance, deposit or testimony from the proposed buyer, and no proof that the sale failed because the Respondents refused inspection or vacant possession. The Appellant therefore did not prove its unilateral Kshs. 3,000 daily rate.
27. Nevertheless, the record contained independent evidence from which reasonable rental value could be assessed. The ProLand Realtors Limited valuation report dated January 2021, produced by the Respondents and admitted in evidence, related specifically to House No. 178 and recorded that similar bungalows within Greenpark Estate were letting for Kshs. 65,000 to Kshs. 70,000 monthly. Although prepared primarily for sale negotiations and eleven months before wrongful possession commenced, it was the only objective rental evidence and the trial court itself relied upon it when comparing the Appellant’s Kshs. 90,000 monthly claim.
28. In Mistry Valji v Janendra Raichand & 2 Others [2016] KECA 538 (KLR), the Court of Appeal approved reasonable rent as the proper measure of ordinary mesne profits. A claimant should not be denied all compensation merely because exact quantification is difficult where the record supplies a rational evidential basis, but the court must adopt a conservative figure to avoid speculation. The lower end of the admitted range, Kshs. 65,000 monthly, is appropriate.
29. The compensable period from 22nd December 2021 to 20th August 2022 is approximately eight months. Mesne profits are consequently assessed at Kshs. 520,000, calculated as Kshs. 65,000 multiplied by eight months. This amount does not enforce the unilateral term in the letter dated 25th August 2021; it is an independent judicial assessment of reasonable rental value under section 2 of the Civil Procedure Act and Order 21 rule 13 of the Civil Procedure Rules. The trial magistrate therefore erred in denying all mesne profits, although the Appellant did not prove the full Kshs. 1,038,000 claimed.
G. Auctioneer’s fees
30. The Appellant specifically pleaded Kshs. 100,000 and produced a letter dated 9th December 2021 instructing Moran Auctioneers, an invoice dated 18th January 2022 and an RTGS record reflecting payment of Kshs. 95,000. Although an auctioneer may undertake chargeable preparatory work without completing the ultimate exercise, the question is not merely whether the auctioneer earned fees from the Appellant but whether that expenditure was a lawful, reasonable and necessary loss recoverable from the Respondents.
31. The instructions and payment predated the possession order of 7th July 2022. The ninety-day notice under section 152E of the Land Act did not itself authorise forcible removal by a private auctioneer, while sections 152E to 152I of the Land Act impose safeguards against arbitrary eviction. Eldoret Travel Agency Limited v Samuel Kandie & Another [2010] eKLR correctly states the general principle that forcible eviction should not occur without lawful process. Rules 5 and 7 of the Auctioneers Rules regulate an auctioneer’s entitlement and responsibility for charges but do not transform every private enforcement expense into damages recoverable from the opposing party.
32. Muriithi v Kuria [2024] KEELC 5607 (KLR) is distinguishable because the auctioneer there implemented an existing eviction order, actual eviction took place and payment was proved in an undefended claim. In the present case, no court order existed when the auctioneer was instructed, the auctioneer did not evict the Respondents, and the Appellant’s witness admitted that they ultimately vacated without an auctioneer’s participation. The expenditure was not proved to be a reasonable consequence of lawful enforcement, and the trial court correctly rejected it.
H. Repair and restoration costs
33. The Kshs. 283,796 repair claim was specifically pleaded and supported by invoices, purchase orders and payment records relating to painting, bathroom and shower work, tiling, grating, manholes, gulley traps, a dhobi sink, plastering, gutters, cornices and vents. Those documents could establish expenditure, but the Appellant also had to prove that the expenditure resulted from damage caused by the Respondents rather than pre-existing defects, age, construction deficiencies, deferred maintenance, ordinary wear and tear or voluntary renovation for resale.
34. David Bagine v Martin Bundi [1997] eKLR establishes that the claimant must prove the actual loss rather than merely place figures before the court. Simba Colt Motors Limited v James Gitahi Mwangi [2015] KECA 385 (KLR) similarly requires each head of special damages to be individually examined and proved. Proof of payment does not dispense with proof of causation.
35. House No. 178 was not newly constructed for the Respondents and had previously been used for accommodation or as a guest house. During occupation, the Respondents complained about leaking gutters, dampness, worn tiles, old shower fittings, mould, plumbing, ceilings, cornices, paintwork, the underground water tank and other signs of age or disrepair; the Appellant’s witness acknowledged those complaints, and several items later repaired corresponded directly with them. No signed condition report existed at entry, no joint exit inspection was conducted, no contemporary schedule distinguished earlier defects from new damage, and no contractor or expert connected the expenditure to any act or omission by the Respondents. The documents also did not exclude commercial upgrading in preparation for sale.
36. The Court of Appeal’s decision in Yusuf Mohammed Jiwa t/a Jiwa Properties & Another v Mwangi & 2 Others [2024] KECA 38 (KLR) confirms that special damages must be specifically pleaded and strictly proved, with the degree of particularity depending upon the circumstances; it does not remove the requirement to prove causation. The Appellant proved expenditure but not the Respondents’ liability for it. The trial court therefore properly dismissed this claim.
I. Sufficiency of the trial judgment
37. Order 21 rule 4 of the Civil Procedure Rules requires a judgment to contain a concise statement of the case, the points for determination, the decision and reasons. The impugned judgment identified the issues, summarized the evidence and submissions and gave reasons on each claimed relief. Its reasoning was not wholly consistent because it found substantial contractual performance yet denied all compensation for subsequent wrongful occupation. That error warrants appellate correction but does not establish that the trial magistrate ignored the parties’ evidence or submissions, and his conclusions on auctioneer’s fees and repairs were properly grounded in the record.
J. Interest and costs
38. Section 26 of the Civil Procedure Act governs interest. Mesne profits are assessed damages whose quantified amount crystallises upon judicial assessment. The principle in Mukisa Biscuit Manufacturing Company Limited v West End Distributors Limited [1970] EA 469 and Orix Oil (Kenya) Limited v Paul Kabeu & 2 Others [2014] eKLR distinguishes an ascertained liquidated sum, on which interest may run from filing, from damages requiring assessment, on which interest ordinarily runs from judgment. The award of Kshs. 520,000 shall therefore attract interest at court rates from 13th November 2024, being the date of the subordinate court’s judgment, until payment in full.
39. Under section 27 of the Civil Procedure Act, costs are discretionary but ordinarily follow the event. The Supreme Court explained in Jasbir Singh Rai & 3 Others v Tarlochan Singh Rai Estate & 4 Others [2013] eKLR that the rule is not absolute and that the court must consider the parties’ conduct, the nature of the litigation and the degree of success. The Appellant has succeeded on the central issue that continued occupation eventually became wrongful and compensable, but has failed to prove more than half of the mesne profits sought and has wholly failed on the auctioneer and repair claims. It should recover one-half of its taxed costs in the subordinate court, while each party should bear its own costs of the appeal.
K. Disposition
40. For the foregoing reasons, the appeal succeeds in part and the Court makes the following orders:
a. The order dismissing the Appellant’s suit in its entirety is set aside.
b. A declaration is issued that the Respondents’ occupation of House No. SFB178A, Greenpark Estate, became wrongful upon expiry of the ninety-day notice, namely on 22nd December 2021, and continued until surrender of possession on 20th August 2022.
c. Judgment is entered for the Appellant against the Respondents jointly and severally for Kshs. 520,000 as mesne profits.
d. The claim for Kshs. 1,038,000 is dismissed to the extent that it exceeds the award of Kshs. 520,000.
e. The claim for Kshs. 100,000 as auctioneer’s fees is dismissed.
f. The claim for Kshs. 283,796 as repair and restoration costs is dismissed.
g. The award of Kshs. 520,000 shall attract interest at court rates from 13th November 2024 until payment in full.
h. The Appellant shall recover one-half of its taxed costs in Mavoko CMCC No. E1067 of 2023.
i. Each party shall bear its own costs of this appeal.
41. Orders accordingly.
READ AND PUBLISHED THIS 28TH AUGUST 2026 IN THE PRESENCE OF:
BEFORE HON JOYCE GANDANI JUDGE