KENYA SCHOOL OF LAW

ADVOCATES TRAINING PROGRAM 2023/2024

ATP 107: CONVEYANCING

CLASS C
FIRM 6
DATE: 21ST MARCH 2023

PRESENTED TO: MS LEAH KIGUATHA

QUESTION: DRAFT AND PRESENT A SALE AGREEMENT FOR A PURCHASER

WHO IS CHARGING THE PROPERTY WHICH IS THE SUBJECT OF THE SALE
TO FINANCE PAYMENT OF THE BALANCE OF THE PURCHASE PRICE.
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FIRM 6 MEMBERS
VUSAKA ASIKO 20231412

OTIENO DON 20230311

MOMANYI MICHELLE 20231266

GITHIOMI ESTHER 20230216

MBIU PHYLIS 20231157

AKINYI DAISY 20230560

SHARON CHERUTO 20231175

IRUNGU JEFF 20230596

KIPKORIR KENNEDY 20230087

MARANYA ROSELYN 20231297

NAIKUMI HARRISON 20230317

SYLVIA CHELIMO 20230653

Introduction
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A sale agreement where a purchaser is securing the balance of the purchase by

charging the property he or she is purchasing gives rise to third party interest. This is because

as soon as the sale is complete, the title is registered under the name of the purchaser and a

charge in favour of the bank is registered in the title of the said property. Such a sale brings

other parties into the transaction. These are the financier and their advocate. In this

transaction, the completion documents are forwarded to the financier’s advocates for them to

register the title under the name of the purchaser and a charge in the favor of the financier.

The documents are usually given on the strength of a professional undertaking.

A professional undertaking (PU) is any unequivocal declaration of intention addressed

to someone who reasonably relies on it. It is usually made by professionals such as advocates

in the course of their practice. Such undertakings create a bridge without which such sale

transactions would not be completed since banks would not release funds without the formal

registration of their interest on the property on sale. The undertaking also protects the vendor

who faces the risk of losing his property should the purchaser fail to release the purchase

price after registration. In Kenya a Professional Undertaking is personally binding on the

advocate and breach thereof constitutes professional misconduct. In the case of Naphtali

Radier v. D Njogu & Co Advocates, the court stated that an advocate is obliged by law as an

officer of the court to honor his professional undertaking.

In sale agreements of the above mentioned nature. The Professional and financial

undertakings are prepared by the Vendor’s advocates and sent to the Financiers advocated.

The financier’s advocates then accept the terms of the undertaking by signing and stamping

the document on their own Letterhead. They also procure their clients (Bank) acceptance and

execution of the financiers undertaking. These are then forwarded back to the Vendor’s

advocate who then releases the Completion documents to the financier’s advocates.
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The financier’ advocate then proceeds to register the sale in the ministry of Lands

where the title is the issued under the name of the purchaser. They then proceed to register a

charge in favor of the financier.

Section 2 of the Land Act and Section 3 of the Land Registration Act defines a Charge

as an interest in land securing the payment of money or money’s worth or the fulfilment of

any condition and includes a sub-charge and the instrument creating a charge. It confers

certain rights on the property to the Chargee from the chargor. A charge acts only as a security

for repayment of a loan and does not transfer any interest or rights on the land.

The registration of a Charge in favour of the bank means that the Purchaser owns the

property but the bank has an interest on it. If the purchaser defaults in paying the loan, the

bank can then seek orders to auction the property to recover its money. The bank only

releases the balance of the purchase price after the charge in its favour has been registered.

The terms of release of the balance is governed by the undertakings that had been issued to

the Vendor’s advocates.

Below is a sample Sale Agreement where the purchaser charges the property to be

purchased to secure the balance of the purchase price

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DATED this ………………………….……. day of…………...……….…………….2023

TO

KENNEDY KIPKORIR
(AS THE “Vendor”)

AND

ESTHER GITHIOMI
(AS THE “Purchaser”)

AGREEMENT FOR SALE

-OF-

ALL THE PROPERTY KNOWN AS TITLE NO. 27820/786

SITUATED IN SIYOI, WEST POKOT (AS “PROPERTY”) AND
MEASURING 2.0 HA OR THEREABOUTS.

DRAWN BY:
KARDSPEARS Advocates,
P.O BOX 4567-00100,
7th Floor UAP Towers, Upperhill
Nairobi.
Email: kardspears@gmail.com.
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AGREEMENT FOR SALE

THIS AGREEMENT is made on the …………………. day of ……………………2023.

BETWEEN

KENNEDY KIPKORIR (AS THE “Vendor”) of ID Number 123456 and of Post Office

Number 6754-30600-KAPENGURIA, West Pokot County in the Republic of Kenya

(hereinafter referred to as “the Vendor”, which expression shall include his personal

representatives and assigns where the context so admits) of the first part;

AND

ESTHER GITHIOMI (AS THE “Purchaser”) of ID Number 37897654 and Post Office

Box Number: 5437-00100, HURUMA-Nairobi County in the Republic of Kenya (hereinafter

referred to as “the Purchaser” which expression shall include her personal representatives and

assigns where the context so admits) on the other part;

In this Agreement, “Parties” and “Party” refer to the Vendor and the Purchaser.

WHEREAS:

A. The Vendor is the registered as the proprietor of the Property (hereinafter described);

B. The Vendor has agreed to sell and the Purchaser has agreed to purchase the Property

for the sum of Kenya Shillings Six Million (Ksh.6, 000,000.00/=) and upon the

terms and conditions appearing in this Agreement.

C. And the Purchaser intends to secure a loan facility from NCBA Bank Kenya to

finance Ninety Percent (90%) of the Purchase Price.

IT IS HEREBY AGREED as follows:

1. Definitions and Interpretation

1.1 In this Agreement (including the recitals hereinabove), save where the context

otherwise requires, the following terms shall have the following meanings:
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“Balance of the Purchase Price”: means the sums remaining unpaid after the

Deposit of the Purchase Price has been paid, to be paid on or before the Completion

Date. For the purposes of this Agreement and as agreed by the Parties, the balance of

the purchase price shall be Kenya Shillings Five Million, Four Hundred Thousand

(Ksh.5,400,000.00/=) only;

“Business Day”: means a day (other than a Saturday, Sunday or gazetted public

holiday in Kenya) on which banks and financial institutions is normally open for the

conduct of banking business in Kenya;

“Completion Date”: means Ninety (90) days from the date of this Agreement or

such other date as may be agreed by the parties in writing;

“Completion Documents”: means the documents listed in sub-clause 7.2 below;

“Deposit”: means 10% of the agreed purchase price to be paid by the Purchaser as

Kenya Shillings six Hundred Thousand (Ksh.600,000.00/=) only.

“Encumbrances”: means and includes any mortgage or charge (whether legal or

equitable), lien, option, security interest, restrictive covenant, pledge, assignment, title

retention, other restriction of any kind, other encumbrance securing or any right

conferring a priority of payment in respect of any obligation of any person;

“Financier”: means the body entrusted by the Purchaser to fund the balance

purchase price of the property herein being NCBA Bank;

“Financier’s Advocate”: means the Advocates duly appointed and representing

NCBA Bank;

“Interest Rate”: means the rate that is six percent (6%) per month;

“LSK Conditions”: means the Law Society of Kenya Conditions of Sale (2015

Edition);
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“Registration”: means due and effective registration of the Transfer and/or the

Charge in respect of the Property in the Land Registry in favor of the Purchaser and

the Financier.

“Property”: means ALL THAT piece of land known as Title No. 27820/786

situated in Siyoi, West Pokot and measuring 2.0 Ha or thereabouts.

“Purchase Price”: means the agreed price of Kenya Shillings Six Million only

(Ksh.6,000,000.00/= as the (Consideration)).

“Purchaser’s Advocates”: means Tishia Advocates, Kenya Cinema Building,

2nd Floor, P.O Box 3765-00100, Nairobi, and of Email Address:

tishiaadv@gmail.com.

“Vendor’s Advocate”: means KARDSPEARS Advocates, of Post Office Box

Number, 4567-00100, at 7th Floor UAP Towers, Nairobi, and of Email Address:

kardspears@gmail.com.

1.2 Where a party is placed under a restriction in this Agreement, the restriction is

to be deemed to include the obligation on that party not to permit infringement of the

restriction.

1.3 The clause and paragraph headings are for ease of reference only and are not

to be taken into account in the interpretation of the provisions to which they refer.

1.4 Unless the context otherwise requires, references to numbered clauses are

references to the relevant clause in this Agreement.

1.5 Words referring to the singular include the plural meaning and vice versa.

1.6 Words importing one gender do not include any other gender.

1.7 References to any statutes or statutory instruments include any statute or

statutory instrument amending, consolidating or replacing them respectively from

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time to time in force, and references to a statute include statutory instruments and

regulations made pursuant to it.

1.8 The expression “person” shall include any legal or natural person, partnership,

trust company, joint venture, agency, state corporation, government or local authority

department or other body whether corporate or not.

1.9 Where any party comprises more than one person the obligations and

liabilities of that party under this Agreement shall be joint.

1.10 Costs, charges, expenses or remuneration shall be deemed to include, in

addition, references to any value added tax or similar tax charged or chargeable.

2. Sale of the Land

2.1 The Vendor shall sell and the Purchaser shall purchase the Property at the

agreed Purchase Price and upon the terms and conditions set out in this Agreement.

2.2 The interest sold is freehold.

2.3 The Purchaser undertakes to commence the transfer process to obtain the title

in her favor as soon as they receive the completion documents.

2.4 The Vendor is estopped from transferring, alienating, selling or subdividing

the portion of land once this Agreement has been executed.

3. Purchase Price

The Vendor shall sell and the Purchaser shall purchase the Property for the agreed

purchase price sum of KENYA SHILLINGS SIX MILLION ONLY

(Ksh.6,000,000.00/=) only (known as the “Purchase Price”);

4. Payment of the Purchase Price

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4.1 The Purchase Price being KENYA SHILLINGS SIX MILLION ONLY

(Ksh.6,000,000.00/=) only (the “Consideration”) shall be paid in the following

manner;

4.1.1 On or before the execution hereof, the Purchaser shall pay Kenya

Shillings Six Hundred Thousand (Ksh.600,000.00/=) only, being 10% of the

purchase price to the Vendor’s Advocate as the deposit of purchase price

through account details which are as follows:

Account Name: KARDSPEARS ADVOCATES

Bank Name: ABSA BANK

Account No.: 5687459

Branch: NAIROBI BRANCH

(Upon execution of this agreement, receipt whereof the Vendor hereby acknowledges)

The Vendor’s Advocates will hold the deposit on stake hold basis, pending registration of the

transfer in favor of the purchaser.

4.1.2 The balance of the Purchase Price being Kenya Shillings Five Million

Four Hundred Thousand Only (Ksh.5,400,000.00/=) shall be paid on the

completion within fourteen (14) days of the registration of the transfer of the

aforesaid parcel of land in favour of the purchaser and the Charge in favour of

the financier and shall be secured by an acceptable professional undertaking

from the purchaser’s financier and/or from the financier’s advocates.

4.1.3 The Balance of the Purchase Price shall be paid into the Vendor’s

Advocates’ account, after release of the sums from the financier (NCBA

Bank). The details of the Vendor’s Advocates’ account are as indicated here

below;

Account Name: KARDSPEARS ADVOCATES

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Bank Name: ABSA BANK

Account No.: 5687459

Branch: NAIROBI BRANCH

5. Financing

5.1 The Purchaser herein shall be financed by NCBA BANK to the tune of Kenya

Shillings Five Million, Four Hundred Thousand (Ksh.5,400,000.00/=)

5.2 The Financier must confirm the Financing arrangement between the Purchaser

and themselves in writing directly to the Vendor's Advocates within thirty (30) days of

the date of this Agreement. If the Financier fails to do so, the Purchaser will be strictly

considered a cash/non-financed buyer and must pay the balance of the Purchase Price

on or before the Completion Date. However, it is important to note that the Purchaser

is not exempted from paying any interest that arises in default of the payment.

6. Completion Date

The date of Completion shall be within Ninety (90) days of the execution of this Agreement

or such other date as the Parties may agree in writing.

7. Completion

7.1 The Purchaser must ensure that their Financier's Advocate issues a suitable

professional undertaking to the vendor's advocate in exchange for the completion

documents listed below on or before the completion date;

7.2 The Vendor will be considered to have met his obligations under this

Agreement if, before the Completion Date, he receives a professional undertaking

from the Purchaser's financier and/or their advocate that is acceptable to the Vendor's

advocates. The undertaking must be in a specific format required by the Vendor's

advocate. Additionally, the Vendor must receive payment of any unsecured portion of
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the Purchase Price. Once these conditions are met, the Financier's advocate will

receive the items listed below;

7.2.1 Original title documents relating to the Property;

7.2.2 Duly executed Transfer in respect of the Properties in favour of

the Purchaser;

7.2.3 Application for consent to transfer the Property and the

attendant consent from the relevant Land Control Board; and

7.2.4 Three (3) coloured passport size photographs of the Vendor as

well as copies of the Vendor’s P.I.N Certificate and National Identity Card;

7.2.5 The Spousal Consent or Affidavit of Singlehood (whichever is

applicable);

7.2.6 Receipts for payment of Capital Gains Tax (if any), Rates and

Rents;

7.2.7 Any other document necessary to effect registration of the

Transfer in favour of the Purchaser.

8. Incorporation of the Law Society Conditions

This Agreement is subject to the Law Society Conditions of Sale (2015 Edition) in so far as it

is not varied by or inconsistent with or excluded or amended by the provisions of this

Agreement.

9. Professional Undertakings

9.1 On or before the Completion Date, the Purchaser’s Financier’s Advocates, as

the case may be, shall issue a suitable professional undertaking to the Vendor’s

Advocates in exchange of the Completion Documents in which they shall undertake

to pay the Vendor the balance of the Purchase price of Kenya Shillings Five Million
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Four Hundred Thousand Only (Kshs. 5,400,000.00/=) within (14) days of

registration of the Transfer of the Property in favour of the Purchaser and the Charge

in favor of the Purchaser’s Financier.

9.2 The Purchaser’s Advocate and/or Purchaser’s Financier’s Advocate and/or

Financier shall undertake not to release the original and/or copies of the registration

certificate to any other person other than the officials at land registry for the purposes

of registration of the charge in favor of the Financier.

10. Time is of Essence

There shall be no delays as time shall be deemed to be of the essence for all the purposes of

this Agreement.

11. Condition of the Property

The Purchaser having been afforded the opportunity of viewing and inspecting the Property

prior to the date of this Agreement, purchases it in the same condition it is in now, and shall

not require the Vendor to improve it in any manner whatsoever.

12. Vacant Possession

The Property is sold with vacant possession and the Purchaser is entitled to take immediate

possession at the time of closing subject provided however that the Purchaser shall not be

entitled to possession until payment of the full Purchase Price. The Vendor shall remove from

the vicinity of the Property any movable assets and chattels on or before the completion date.

13. No Encumbrances

The Property is sold subject to the Acts, Covenants, Conditions and Stipulations as more

particularly set out in the documents of title relating to the Property but otherwise free from

any mortgage, charge, lien, encumbrances or adverse claims whatsoever.

14. Disclaimer

The Purchaser agrees and admits that:

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14.1 Any condition or warranty whatsoever as to the condition of the Property or its

fitness for any purpose is hereby excluded;

14.2 She has inspected and surveyed the Property and purchases the Property with

full knowledge of its actual state and condition and shall take the Property as it stands

at the Completion Date;

15.3 She enters into this Agreement solely as a result of her own survey and

inspection and on the basis of the terms of this Agreement and not in reliance upon

any representation either written or oral or implied or made by or on behalf of the

Vendor; and

14.4 This Agreement constitutes the whole and any agreement between the parties

hereto relating to the sale and purchase of the Property and supersedes and

extinguishes any prior agreements, undertakings, representations, warranties and

arrangements of any nature whatsoever whether or not in writing relating to the sale

and purchase of the Property.

15. Default Clause

15.1 If on the Completion Date the Purchaser is not ready, able or willing to pay the

balance of purchase price as required under the provisions of this Agreement then,

without prejudice to any other rights or remedies available to the Vendor, the Vendor

shall in his sole discretion have the right to either:

(i) rescind this Agreement; or

(ii) extend from time to time the Completion Date to any date, provided

always that the Vendor may in his sole discretion rescind this Agreement at

any time, if at such time the Purchaser shall not be ready, able or willing to

complete the Sale.

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15.3 And upon such rescission, the Purchaser shall forfeit to the Vendor as

liquidated damages, the sum of Kenya Shillings Six Hundred Thousand,

(Ksh.600,000.00/=) paid as the deposit of the Purchase Price.

16. Interest Clause

If the Purchaser delays in payment of the balance and exceeds the Completion Date set

herein, Interest at the rate of 6% per month on the purchase price will accrue and be

computed as from the 91st day after the execution of this agreement and will continue to run

until payment of the purchase price and interest accrued is completed.

17. Restriction on Assignment

This Agreement is personal to the Purchaser and the Purchaser shall not be entitled to assign

all or any of the Purchaser’s rights and/or transfer any of her obligations hereunder without

previous written consent of the Vendor.

18. Non-Merger

This Agreement shall not merge on completion of the sale and purchase of the Property and

completion shall not limit, cancel or extinguish the performance of any outstanding duties or

obligations under this Agreement.

19. Legal and Other Costs

19.1 Each party shall be responsible for the fees of its advocates in connection with

this Agreement and the sale and purchase of the Property.

19.2 All stamp duty and registration fees payable on the transfer of the Property to

the Purchaser shall be on the Purchaser’s account.

20. Waiver

No failure or delay by the Vendor or the Purchaser in exercising any claim, remedy, right,

power or privilege under this Agreement shall operate as a waiver nor shall any single or
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partial exercise of any claim, remedy, right, power or privilege preclude any further exercise

thereof or the exercise of any other claim, right or power.

21. Vendor’s Representations and Warranties

The Vendor warrants to the Purchaser that to the best of their actual knowledge and belief:

21.1 The Vendor is the legal and registered owner of the Property and has good and

marketable title to the Property;

21.2 The Property is not on a road reserve or public land and the Vendor's

ownership thereof is not subject to any challenge whatsoever from the Government of

the Republic of Kenya, any County authority or any third party;

21.3 There are no circumstances, to the Vendor’ knowledge, which (with or

without the taking of other action) would entitle any third party to exercise a right or

power of entry or to take possession or which would in any other way affect or restrict

the continued possession enjoyment or use of the Property for its present purpose.

21.4 The Vendor further indemnifies the Purchaser from any legal action that shall

arise with regard to proper ownership of the said property. Should any claim arise

within three months of the registration of the Transfer, the Purchaser shall be entitled

to a refund within fourteen (14) days’ notice of all monies that they shall have

expended on the purchase thereof.

21.5 There is no law or decree or similar enactment binding them so far as they are

aware which would conflict with or prevent him from entering into or performing and

observing the terms of this Agreement;

21.6 The Vendor is not engaged in nor to the best of the Vendor’s knowledge

threatened by any litigation, arbitration or administrative proceedings relating to this

Property;
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21.7 There is no adverse claim on the Property, dispute regarding ownership,

boundary, easement, rights of way or any other such matters;

21.8 The Vendor has not given any right of way, easement or any overriding

interest and has no intention of so doing;

21.9 There is no other matter of which the Vendor is or ought to be aware of on

reasonable inquiry and which adversely affects the value of the Property or casts any

doubt on the right of title of the Vendor to it;

21.10 The Vendor has to the best of his knowledge disclosed to the Purchaser all

material information relating to this Property;

21.11 The Vendor has not received any notice from the government or municipal

authority or from owners of adjoining properties which remain to be complied with

and have disclosed all such notices received to the Purchaser; and;

21.12 The Vendor will immediately disclose in writing to the Purchaser any event or

circumstance which may arise or become known to him after the date of this

Agreement and prior to Completion which is inconsistent with any of the warranties

or which had it occurred on or before the date of this Agreement would have

constituted a breach of the warranties or which is material to be known by a Purchaser

for value of the Property.

21.13 The vendor is the legal, beneficial and registered owner of the property and

has the requisite authority and power to enter into and perform this agreement.

21.14 There are no circumstances which (with or without taking of other action)

would entitle any third party to exercise a right or power of entry or to take possession

or which would in any other way affect or restrict the continued possession enjoyment

or use of the property for its present purpose.

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21.15 The Vendor has to the best of their knowledge disclosed to the Purchaser all

material information relating to the property.

22. Purchaser’s Representations and Warranties

The Purchaser represents and warrants to the Vendor that:

22.1 She has the requisite power and authority to enter into and perform this

Agreement;

22.2 This Agreement and the other documents executed by the Purchaser which are

to be delivered at or prior to Completion will upon execution constitute binding and

enforceable obligations of the Purchaser in accordance with its terms; and

22.3 She has inspected the Property prior to entering into this Agreement and

satisfied herself as to the actual state and condition thereof.

23. Notice

Any notice to be given to any Party to this Agreement shall be in writing and shall be deemed

to be duly served by being sent by registered post to the address indicated in this Agreement.

24. General Conditions

24.1 All payments due to be made by the Purchaser hereunder and all costs, charges,

expenses or remuneration shall be deemed to be exclusive of any value added tax or similar

tax charged or chargeable in respect thereof and for which the Purchaser shall be liable to

account.

24.2 Each party herein shall bear its Advocate’s charges in connection with this transaction.

The Vendor shall meet the costs of obtaining the Completion Documents and payment of

Capital Gains Tax and the Purchaser shall meet the costs of stamp duty and registration fees

on the Transfer.

24.3 No failure or delay to exercise any power, right or remedy by the Vendor shall operate

as a waiver of that right, power or remedy and no single or partial exercise by the Vendor of
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any right, power or remedy shall preclude its further exercise or the exercise of any other

right, power or remedy.

24.4 The rights and remedies of the Vendor provided in this Agreement are cumulative and

not exclusive of any rights or remedies provided by law.

24.5 Each of the provisions of this Agreement is severable and distinct from the others and,

if at any time one or more of these provisions is or becomes invalid, illegal or unenforceable,

the validity, legality and enforceability of the remaining provisions shall not in any way be

affected or impaired.

24.6 No amendment or variation to this Agreement shall be effectual or binding on the

parties hereto unless it is in writing and duly executed by or on behalf of the parties to this

Agreement.

25. Force Majeure

In the event of a party’s inability to continue the performance of their obligations under this

agreement after ninety (90) days of an act of force majeure, either party may terminate this

agreement by notice and both parties shall thereafter be discharged from their obligations

under this agreement. The parties shall on termination be restituted to their original position.

26. Governing Law

This Agreement shall be governed by and construed in accordance with the laws of Kenya.

27. Dispute Resolution

Any dispute, difference or question whatsoever which may arise between the parties

including the interpretation of rights and liabilities of either party shall be solved through

court annexed mediation as governed by the Civil Procedure (Court-Annexed Mediation)

Rules, 2022, upon consent by all parties to the dispute; and the decision of the accredited

mediator shall be final and binding on the parties hereto.

*the remainder of this page has intentionally been left blank*

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IN WITNESS WHEREOF the parties hereto have duly executed this Agreement the day

and year first herein before written

Signed by

KENNEDY KIPKORIR: ) Signature;

(The Vendor) )

In the presence of: -

(Witness) )

) Name;

) Signature;

) I.D:

) P.I.N:

VENDOR’S ADVOCATE )

CERTIFICATE

I………………………………………………., an Advocate of the High Court of Kenya who

witnessed the execution of this Agreement CERTIFY that

…………………………………………….appeared before me on the ………………………

day of………………………………20…………..and (being known to me/being identified to

me by………………………) acknowledge the above signature or mark to be his/hers/theirs

and that he/she /they had freely and voluntary executed this instrument and understood its

contents.

……………………………………………………………………

Advocate’s Signature

Signed by:-
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ESTHER GITHIOMI: ) Signature;

(The Purchaser) )

In the presence of: -

(Witness) )

) Name;

) Signature;

) I.D:

) P.I.N:

PURCHASER’S ADVOCATE )

CERTIFICATE

I………………………………………………., an Advocate of the High Court of Kenya who

witnessed the execution of this Agreement CERTIFY that

…………………………………………….appeared before me on the ………………………

day of………………………………20…………..and (being known to me/being identified to

me by………………………) acknowledge the above signature or mark to be his/hers/theirs

and that he/she/they had freely and voluntary executed this instrument and understood its

contents.

……………………………………………………………

Advocate’s Signature

DRAWN BY:

KARDSPEARS ADVOCATES,

P.O BOX 4567-00100,

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7th FLOOR UAP BUILDING,

NAIROBI