Grace Nemayian Konchellah & another v Gideon Mwiti Irea [2017] KECA 163 (KLR)
The bottom line
#Kenya's Court of Appeal ruled a buyer who never proved paying for land must return its value, plus interest since 2003.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the respondent breached the terms and conditions of the agreement for sale by failing to pay the balance of the purchase price of Kshs. 1,400,000.00
- 2.Whether the appellants are entitled to the reliefs they sought before the High Court
- 3.On whom lay the burden of proving payment or non-payment of the balance of the purchase price
- 4.Whether the trial Judge misdirected herself in requiring the appellants to produce the original title deed and to prove ownership and fraud or illegality
Key legal issues
#Allocation of the burden of proof regarding payment of the purchase price
The trial Judge misdirected herself by requiring the appellants to prove non-payment; the burden lay on the respondent, who pleaded payment, under Section 109 of the Evidence Act.
The respondent pleaded in his defence that he paid the balance of the purchase price but neither testified nor called evidence. As the party asserting payment, he bore the burden of proving that assertion. The trial Judge instead proceeded on the basis that the appellants had to prove they had not received the balance, a misdirection. Section 109 of the Evidence Act and this Court's decision in Diamond Trust Bank Kenya Ltd v Said Hamad Shamisi support this allocation.
Whether the respondent breached the agreement for sale
The Court found as a fact that the appellants transferred the property before receiving the full purchase price and that the respondent failed to pay the balance of Kshs. 1,400,000.00.
The agreement provided that the balance would be paid in three instalments by 31st March 2003 and that completion documents, including the original title deed, would only be furnished on completion. Notwithstanding this, the property was transferred early on the strength of an undertaking by Choice Credit International Ltd. The respondent adduced no evidence of payment, and the uncontroverted evidence established breach.
Whether the trial Judge erred in requiring production of the original title deed and proof of ownership and fraud or illegality
Having surrendered the completion documents and the property having been transferred to the respondent, the question of the appellants producing the original title or proving registered ownership did not arise; their claim was for re-transfer for non-payment, not founded on fraud or illegality.
The trial Judge's judgment showed she did not fully appreciate the appellants' grievance, which was re-transfer of the property upon failure of payment of a substantial part of the price. Since the appellants had already transferred the property and surrendered the title documents, demanding proof of current registration was misconceived. Neither party had pleaded fraud or illegality, and the parties are bound by their pleadings.
Whether the court could grant judgment for the unpaid purchase price which was not specifically sought
Yes; since the issue whether the respondent paid the balance arose from the pleadings and was canvassed by evidence and submissions, the court could pronounce judgment on it and award the unpaid balance in money.
One of the issues framed for trial was whether the respondent paid the balance of Kshs. 1,400,000.00. The appellants led evidence and both parties made submissions on it. Following Odd Jobs v Mubia, a court may base its decision on an unpleaded issue where the course of trial shows the issue was left to the court. As the property's status was unclear having allegedly been transferred to a third party, monetary judgment for the unpaid balance was the appropriate remedy.
Legal principles established
#- On a first appeal, the Court of Appeal is duty-bound to reconsider and evaluate the evidence afresh and draw its own conclusions, while making due allowance for not having seen or heard the witnesses.
- The burden of proving payment lies on the party asserting that payment was made; a party cannot be required to prove a negative such as non-receipt of payment.
- A court may pronounce judgment on an issue not specifically pleaded if, from the course followed at trial, the parties by their pleadings, evidence and submissions left that issue to the court for determination.
- A purchaser who has taken transfer of property without paying the purchase price cannot retain both the property and the unpaid balance; the vendor is entitled to judgment for the unpaid purchase price.
Court orders
#- 1.Appeal allowed
- 2.Judgment of the High Court given on 13th July 2012 set aside
- 3.Judgment substituted in favour of the appellants against the respondent for Kshs. 1,400,000.00 with interest at court rates from 31st March 2003 until payment in full
- 4.Appellants awarded the costs of the proceedings before the High Court and the costs of the appeal
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court of Kenya at Nairobi (ELC Division), originally filed at Machakos
- ELC. No. 659 of 2009
- Jurisdiction invoked
- First appellate jurisdiction under the Court of Appeal's statutory appellate powers (appeal as of right from the High Court in a civil suit)
Relief refused
#Declaration that the appellants are entitled to be registered as proprietors of Title Number Ngong/Ngong/20194 and an order directing the respondent to transfer the property back to them
The status of the property was unclear, counsel stating from the bar that the respondent had since transferred it to a third party; the court instead substituted a monetary judgment for the unpaid balance
Costs
The appellants shall have the costs of the proceedings before the High Court and the costs of this appeal.
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
In the result, we allow the appeal and set aside the judgment of the High Court given on 13 th July 2012. We substitute the judgment in favour of the appellants against the respondent for Kshs. 1,400,000.00 with interest at court rates from 31st March 2003 until payment in full. The appellant shall have the costs of the proceedings before the High Court and the costs of this appeal.
The burden lay with the respondent, as the party wishing the trial court to believe that he had paid the balance of the purchase price, to prove it.
Where, as here, the parties have by their pleadings, evidence and submissions canvassed an issue and referred the same for determination, the court can pronounce judgment on it.
The respondent cannot keep the balance of the purchase price and at the same time keep or benefit from the property. He cannot have it both ways. It is unjust.
An appeal to this Court from a trial by the High Court is by way of retrial and the principles upon which this Court acts in such an appeal are well settled.
Issues in the judgment
#The case name of the Diamond Trust Bank authority appears in two slightly different renderings within the judgment ('Diamond Trust Bank Ltd' in submissions and 'Diamond Trust Bank Kenya Ltd' in the court's holding), which may cause inconsistent citation matching.
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (1)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
Cite this brief
#Cite this brief
Caselaw, "Grace Nemayian Konchellah & another v Gideon Mwiti Irea [2017] KECA 163 (KLR)", Case Analysis (2017). Civil Appeal No. 93 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2017/163/eng@2017-11-17
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.