SAPRA STUDIO V KENYA NATIONAL PROPERTIES LIMITED [1985] KECA 123 (KLR)
The bottom line
#What this practically means
#Executive summary
#Key legal issues
#Mutual mistake of fact versus mistake of law
The mistake of both parties was as to the effect of the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act (cap 301) on the head tenancy, i.e. a mistake of law, so the agreement for a direct tenancy was not avoided and remained enforceable.
The parties knew the lease would expire on November 7, 1975 and it did; what they misapprehended was the statutory protection that continued the tenancy under cap 301. Halsbury and Jenkins LJ's dissent in Solle v Butcher show that ignorance of the effect of a public statute is a mistake of law for which no relief lies. The trial judge misapprehended Solle v Butcher in holding the contract void for a mistake of fact.
Distinction between 'lease' and 'tenancy'
The terms are distinct but the question was not determinative: whichever term was used, neither party was under any misapprehension about the subsisting relationship between Kenya National and Kenya Cold Storage, and Todd J's judgment was merely declaratory.
The court examined dictionary definitions and section 2 of the Act. Chesoni Ag JA held the Act does not allow interchangeability of the terms, but Hancox JA held it mattered not which term was used since the conduct of the parties showed they contemplated the termination of the whole relationship. Todd J's declaration did not change the actual state of affairs.
Measure of damages for failure to complete an agreement for lease
The rule in Bain v Fothergill does not apply because the failure was not due to defective title but to a mistake of law and a statutory impediment; damages were assessed on the rent paid, advocates' costs incurred, and nominal damages.
Hancox JA distinguished the defective-title cases and applied Hadley v Baxendale contemplation to reject loss-of-bargain damages. Chesoni Ag JA, dissenting on quantum, applied the normal measure of rental value less contractual rent with a mitigation reduction from April 1976. Both agreed the trial judge's notional figure of Kshs 207,200 could not stand.
Slip rule jurisdiction of a reconstituted appellate court
Although the omission of interest was an accidental slip or omission correctable under rule 35 before perfection, neither the remaining members of the original court nor the reconstituted court had jurisdiction to correct it or to rehear the matter de novo.
The authorities show courts have inherent power to recall a judgment before perfection by formal order; the omission of interest was an accidental omission, not a clerical error. But because Chesoni Ag JA had ceased to hold office, the court that gave judgment could no longer exist, and interest could not be argued in isolation from damages. Raniga v Jivraj was not followed on amendment after the formal order.
Legal principles established
#- Relief will not be granted on the ground of a mistake of law as distinguished from a mistake of fact; a contract affected only by a mutual mistake of law is not void.
- Even a mistake as to a fundamental fact renders a contract voidable, not void, so it remains valid until set aside on some equitable ground.
- The restrictive rule in Bain v Fothergill on damages for failure to complete is confined to defective title cases and does not extend to a statutory impediment or a mistake of law.
- A court may correct an accidental slip or omission in its judgment under the slip rule only before the decision is perfected and only by the same constitution of the court; a reconstituted court cannot do so.
- The terms 'lease' and 'tenancy' are distinct: a lease is the instrument or agreement which gives rise to the relationship of landlord and tenant, while a tenancy is the interest or possession held under it.
Court orders
#- 1.Appeal allowed on ground 2 of the memorandum of appeal (mistake was one of law; the agreement was not avoided)
- 2.Judgment of Brar J dismissing the action and giving judgment on the counterclaim set aside; judgment given for the appellants on the claim
- 3.Cross-appeal allowed to the extent of substituting for the judge's notional figure the damages awarded by the court
- 4.Costs of the appeal and three quarters of the costs of the proceedings in the High Court awarded to the appellant
- 5.Costs of the cross-appeal awarded to the respondents
- 6.On the ruling of June 12, 1985: no order as to costs, the matter having been raised by the court of its own motion
- On appeal from
- High Court at Nairobi
- High Court Civil Case No 539 of 1980
- Jurisdiction invoked
- Appellate jurisdiction of the Court of Appeal under the Appellate Jurisdiction Act (cap 9), proviso to section 5(3) referred to
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "SAPRA STUDIO V KENYA NATIONAL PROPERTIES LIMITED [1985] KECA 123 (KLR)", Case Analysis (1985). Civil Appeal No 68 of 1983. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/1985/123/eng@1985-04-25
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.