- Zipporah Waitindi signed the letter of offer dated 23rd June 2013 to purchase the property known as Apartment Number A9. The letter of the offer had been prepared by Knight Realtors Limited the vendor’s agents. The agents received the 10 0 deposit for the apartment being the sum of Kshs.1,200,000/ and wired it immediately to the vendor’s account.
The Apartment is situated in Block A and is part of a 300 units housing estate development christened NEW SOUTH C being undertaken by Kenya Ports Authority Pension Scheme. The land upon which the development is being undertaken is registered under the provisions of the Registration of Titles Act Cap 281 of the laws of Kenya, (now repealed). Ms. Waitindi has recently received a 32-page Agreement for sale and has appointed you as her advocate in view of the complicated nature of the document. Your client has instructed you to represent her, as she cannot fathom the legal implications of most of the clauses on her own. The sale/purchase price of the apartment is Kshs.12, Ms. Waitindi has indicated to you that she will be borrowing the balance of the purchase sum from KCB Limited as her employer has negotiated a preferential interest rate for staff.
The Agreement for Sale contains the following clauses amongst others:
(i) The purchaser hereby accepts the right of the vendor to sell the apartment and shall not require any evidence or raise any objections, requisitions, or inquiry in respect of the vendor’s title to the site;
Completion on the part of the vendor shall be 15 days from the date when the vendor’s architect avails a certificate of practical completion of the property. The purchaser shall complete the contract on or before 90 days from the date of its execution by the parties.
- If the balance of the purchase sum is being financed, late interest charges at the rate of 190 0 per annum above the Barclays Bank of Kenya base lending rate shall be charged on the balance of the purchase sum from the completion date until payment in full;
- The vendor shall not be liable for any patent or patent defects discovered after hand over of possession of the property to the purchaser and the purchaser hereby acknowledges that the property had been constructed in a workmanlike manner.
- The Law Society Conditions of Sale (1987) edition is explicitly excluded from this contract. If the purchaser shall default to complete the contract on or before 90days from the date of execution, the vendor will issue no completion notice to the purchaser. The deposit paid shall then be forfeited to the vendor. The vendor shall resell the apartment to another ready able and willing buyer. The purchaser shall be liable for all of the vendors and its agent’s costs expenses and fees incurred for the purposes of such as resale. Where the resale realizes a profit, the vendor will retain the profit solely.
- Advice the purchaser restricting your advice to the contents of the above-referenced clauses. (10 marks)
- What steps will you take before contract execution and at contract completion? The purchaser insists she must purchase the apartment as it is reasonably priced and its location is ideal for Ms. Waitindi’s commute to work. (5 marks)