Grounds for Judicial review
1. When a body acts ultra vires;
2. Unreasonableness;
3. When there is jurisdictional error;
4. When there is an error of law;
5. When there is an error of fact;
6. When there is an abuse of power;
7. When irrelevant considerations governed the making of a decision;
8. When there is bias;
9. When there is unfair hearing;
10. When there is procedural flaw;
11. When there is irrationality
12. When a public official or body acts in bad faith;
13. When there is breach of the principles of natural justice
Factors undermining the rule of law.
1. Excessive power by the executive
2. Corruption
3. Selective prosecution
4. ignorance of the law
5. civil unrest
6. non-independent judiciary
principles or rules to be followed in Nemo Juex in cause sua/audi alteran Partem
1. rule against Bias
2. the right to be heard
3. prior notice
4. opportunity to be heard
5. Disclosure of information
6. Adjournment
7. Cross examination
8. Giving reasons
9. Legal representation
Certiorari---- to be informed
ultra vires --- The capacity of a company is restricted to transactions set forth in
the objects clause
Explain the advantages of a private company over a public company.(6 marks)
1. Subscribers are in a position to control membership.
2. Transfer of shares is restricted, members determine who may join.
3. It is the best vehicle for family business.
4. It is subject to less statutory formalities e.g. need not publish annual accounts or hold
the statutory meeting.
5. Entitled to commence business on the date of incorporation.
Specify the conditions that an alien must satisfy before being granted citizenship in
your country. (6 marks)
Under the provisions of the constitution, the following categories of persons may be registered
as citizens of Kenya on application to the Minister:
a) A woman married to a citizen of Kenya is entitled on application to be registered as a
citizen; the application may be made during the lifetime of her husband.
b) A citizen of the commonwealth who has been lawful and ordinarily resident in Kenya for not less than 5 years.
c) A citizen of any African Country which permeated Kenyans to be registered as her own
citizen, who has been lawfully and ordinarily resident in Kenya for at least 5 years.
d) A person born outside Kenya but whose mother is a citizen of Kenya.
e) A person born in Kenya before 11/12/1963 where neither parent was born in Kenya.
TYPES OF DOMICILE
a. Domicile of origin
b. Domicile of dependence
c. Domicile of chance
ADVANTAGES OF THE REGISTERED COMPANIES
This can also be referred to as Advantages of Incorporation:
1. Limited liability: Members of a registered company have limited liability; the extent towhich they can be called upon to contribute to the
assets of the company in the event of winding up is limited by shares or guarantee. Members are not liable to lose private assets if the company
is insolvent.
2. Perpetual succession: Since a registered company is created by law, its life lies in the intendment of the law. It has the capacity to exist in
perpetuity. This is advantageous where the company’s business is prosperous. It also encourages investment on a long term basis.
3. Capacity to contract and own property: A registered company has legal capacity town property and can enter into contractual relationships
set out in the objects clause. The company therefore has capacity to invest to enhance profitability.
4. Sue or be sued: A registered company has capacity to enforce its rights by court action and may be sued on its obligations. Members are not
bound to sue on behalf of the company and cannot generally be sued for the wrongs of the company.
5. Wide capital base: Compared to other forms of business associations, the registered company has the widest capital base by reason of the
wide spectrum of membership.
6. Transferability of shares: Under section 75 of the Companies Act, the shares or other interests of any member of the company shall be
moveable property transferable in manner provided by the Articles. Shares in public and private companies are transferable. In public companies,
they are freely transferable. The transfer is restricted in private companies under the ambit of Section 30 of the Act. Transferability of shares
ensures that company membership keeps on changing from Time to time and the company could take advantage of the skills of the members.
7. Specialized / qualified management: companies are managed by directors elected by members in general meeting. Under section 177 of the
Companies Act, every private company must have at least one director while a public company must have at least two. Shareholders have the
opportunity to elect qualified persons as directors.
8. Borrowing by floating charge: Registered companies are free to utilize the facility of floating charge to borrow. This is the use of floating
assets as a security. The charge is equitable and remains dormant until crystallization. A floating charge has several advantages:
a. It enables a company with no fixed assets to borrow.
b. It enhances the borrowing capacity of a company with fixed assets.
c. It does not interfere with the ordinary business of the company.
DISADVANTAGES OF THE REGISTERED COMPANIES
1. Formalities: Companies are subject to too many legal formalities like formation, meetings, accounts, winding up etc.
2. Publicity: Companies are subject to undue publicity e.g. a company’s documents are open to public scrutiny. Public companies must submit
annual accounts. General meetings are held in public. Winding up is conducted in the eyes of the public.
3. Expenses: The registered company is the most expensive form of business association to form, maintain or wind up.
4. Doctrine of ultra vires: The capacity of a company is restricted to transactions set
forth in the objects and those that are reasonably incidental thereto. Other transactions are ultra vires and therefore null and void.
5. Corporation tax: The tax payable by companies is relatively higher. This reduces the amounts of profits available to members as dividend.
6. Participation in management: Members other than directors are actively involved in the day-to-day affairs of the company.
ADVANTAGES OF A PARTNERSHIP
1. Specialization and division of powers: Where the association is profession oriented.
2. Sharing of management: All partners are entitled to take part in the firm’s management.
3. Wide capital base: this will assist in pooling together working and investment capital.
4. Easy to form: Formation is not subject to many legal formalities.
5. Flexibility: Partners are free to change the nature of business, provided all agree.
6. Sharing of Losses: Losses and Liabilities are shared amongst the partners thereby cushioning the detriment.
DISADVANTAGES OF A PARTNERSHIP
1. Liabilities of partners for debts and obligations of the firm is unlimited i.e. partners are
liable to use personal assets if the firm is insolvent.
2. Sharing of profits reduces the amount available to individual partners.
3. A single partner‟s mistake affects all partners.
4. Disagreements between partners often delay decision-making.
5. Tends to rely on a single partners effort to manage.
6. Death, bankruptcy, or insanity of a partner may lead to dissolution.
DISSOLUTION OR WINDING UP BY THE COURT
i) A partner has become a lunatic or is permanently of unsound mind
ii) A partner has become permanently incapable of discharging his functions as a
partner.
iii) A party is continuously guilt of willful breach of the partnership agreement.
iv) A partner has conducted himself on manner unfairly prejudicial to the firm and his
continued association is likely to bring the firm’s name into disrepute.
v) The firms’ businesses can only be carried on at a loss.
vi) Circumstances are such that it is just and equitable that the firm be wound up e.g.
Disagreement.
DISSOLUTION WITHOUT THE COURTS INTERVENTION
1. Performance: A partnership dissolves on the accomplishment of the purpose for which it was formed.
2. Lapse of time: A partnership comes to an end on operational of the duration prescribed by the parties.
3. Mutual agreement: This is a situation where the parties agree to dissolve the firm. All partners must be party to the agreement
4. Death: Unless the partnership deed otherwise provides, the death of a partner leads to dissolution.
5. Bankruptcy: Unless the partnership deed otherwise provides a partnership dissolve if a partner is declared bankruptcy by a court of competent
jurisdiction.
6. Termination at will or at notice: Where the duration of the partnership is not specified, it may be dissolved by notice i.e. a partners notice to
the others of his intention to have the firm dissolved
7. Illegality: If the business of the partnership becomes illegal by reason of change of law or otherwise, the firm is dissolved.
8. Charging a partner’s interest: If a partner’s interest in the firm is charged by a court order for a private debt, the firm is dissolved
Characteristics of corporations:
1. Legal personality
2. Limited Liability
3. Ownership of property
4. Sue or be Sued
5. Capacity to contract
6. Perpetual Succession
Explain the circumstances under which trespass to persons would be justified under
law
a) If the person was acting in defense of his person
b) If the person was stopping a breach of the peace
c) If the person was preventing the commission of a crime and used reasonable force
d) If the person was affecting or assisting in the lawful arrest of offenders or suspects
e) If the person was acting in aid of officers of the law
f) If the person was in such as to be dangerous to himself and others
g) If the person was administering reasonable chastisement in the exercise of parental
or other authority
h) If the person was exercising authority of a shipmaster
i) If the plaintiff had consented
j) If the person was acting in defense of his property
Essentials of an insurance contract
1. Agreement
2. Uncertainty
3. Insurable Interest
4. Control
5. Accident or Negligence
6. Risk
Elements of insurance
1. Parties
2. Premium
3. Risk
4. Uncertainty
5. Insurable interest
6. Control
7. Negligence
Proposal form (insured to insurer) seeks info in relation to
1. Particulars of the proposal
2. Particulars of the subject matter
3. Circumstances affecting the risk
4. The history of attachment of the Risk.
Acceptance of the Proposal Form by:
1. By formal Communication
2. BY conduct
3. By issue of the Policy
4. Acceptance and retention of premium raises a resumption of acceptance of the proposal form
Termination of a contract
1. Payment of Indemnity or the sum assured in the event of total loss. In the case of loss, reinstatement does not terminate the policy.
2. Mutual agreement: The parties may at any time agree to terminate the contract at the instance of the insured. In property insurance,
the insured becomes entitled to the surrender value of the policy. In life policies, if the insured has been a bona fide insured for 3 years
he is entitled to 75% of all premium paid inclusive of any bonuses and interests payable.
3. Breach of condition or warranty: The insurer is entitled to apply for cancellation of the policy if the proposer breached a condition or
warranty to procure the policy e.g. Misreprentation or non-disclosure of material facts.
4. Lapse of time: Indemnity contract or property Insurance lapse after one year. It is the duty of the insured to renew cover.
5. Operation of law: These are circumstances which render the maintenance of the policy impossible e.g Winding up or Liquidation of
the insurer.
6. Sale of the subject matter
The principles of Insurance includes: 1. Insurable Interest
2. Utmost good faith (non-disclosure)
3. Indemnity
4. Subrogation
5. Salvage
6. Double Insurance
7. Contribution and Apportionment
8. Proximate Cause
9. Abandonment
10. Average Clause
11. 3rd Party Insurance
Classification of Insurance Contract(Types of Insurance)
1.
2.
3.
4.
5.
The event insured
The interest insured
Nature of the Contract (Indemnity vs non-Indemnity)
Private or Social
Basics of the Programme (Insurance or Re-insurance)
Insurance: a contract whereby a person undertakes to pay a premium so as to be paid a sum of money upon the occurrence of the event insured
against.
Insured: the person who takes out a cover and promises to pay a money consideration.
Insurer: the party that undertakes to pay out compensation if the event insured against occurs.
Insurable interest: the interest a person has in the subject matter which he stands to lose in the event of its loss or destruction
Indemnity: is a contract whereby the insured takes out a policy on the understanding that when loss occurs, he will be indemnified for loss
Subrogation: It means that after indemnifying the insured, the insurer becomes entitled to all the legal and equitable rights in respect to the
subject matter previously exercisable by the insured.
Reinstatement: This is the repair or replacement of the subject matter in circumstances in which it may be re-instated.
Premium: Payment made by insured to insurer.
Risk: It is the chance of loss, the probability of loss or the probability of any outcome different from the one expected.
Double Insurance: This is a situation whereby a party takes out more than one policy on the same subject matter and risk with different insurers
but where the total sum insured exceeds the value of the subject matter.
Proximate clause: An insurer is only liable where loss is proximately caused by an insured risk and not liable where the risk is excepted Under
this principle, the proximate and not the remote cause is to be looked to. (causa Proxima non remota spectatur)
Policy: Written contract or certificate of insurance.
Wagering Contract: Betting contract.
LAW OF CONTRACT
7.1 Definition of a contract
7.2 Classification of contracts
7.3 Essentials of a valid contract
7.4 Terms of a contract
7.5 Exemption clauses
7.6 Vitiating factors
7.7 Discharge of contract
7.8 Remedies for breach of a contract
7.9 Limitation of actions
7.10 Contract negotiation
7.11 Information technology and the law of contract
A contract may be defined as a legally binding agreement made by 2 or more parties
Classification of a contract
1. Written /specialty contract
2. Contract requiring written agreement
3. Simple Contract
4. Contracts under seal
Contents of s memo/ notes in contract requiring a written agreement
1.
2.
3.
4.
A Description of the parties sufficient to identify them
A Description of the subject matter
A consideration (Value)
Signature of the Parties
Elements of a contract
1. Offer
2. Acceptance
3. Capability
4. Intention
5. Consideration
6. Legality
7. Formalities, if Any
Sources of Law of contract
1. Substance of common law
2. Doctrines of equity
3. Certain Statutes of General Application
4. Other Acts of the Kenyan Parliament
Characteristics of an offer
1. It may be writer, oral or implied from the conduct of the offeror
2. An offer must be communicated to the intended offerees
3. Must be clear and definite
4. The offer must conditional and absolute.
5. The offer may prescribe the duration od offer is to remain open for Acceptance
6. The offeror may prescribe the method of communication of acceptance by the offeree
7. An offer may be general or specific
N.B Invitation to treat-This is a mere invitation by a party to another or others to make offer or bargain.
Types of offers
1. Cross offer
2.
3.
Counter offer
Standing offer
Termination of an offer
1. Revocation
2. Rejection
3. Counter offer
4. Lapse of time
5. Death
6. Insanity
7. Failure of a condition subject to which the offer was made
Rules of revocation of offers
1. An offer is revocable at any time before it becomes effectively accepted.
2. Notice of revocation must be communicated to the offeree.
3. An offer is revocable even in circumstances in which the offeror has promised to keep
it open to a specified duration, unless an option exists.
4. Revocation becomes legally effective when notice is received by the offeree.
5. An offer is irrevocable after acceptance.
6. In unilateral contracts, an offer is irrevocable if the offeree has commenced and continues
to perform the act which constitutes acceptance.
7.A bid at an auction is revocable until the hammer falls.
A contract may be discharged on the following ways:
a) Express agreement
b) Performance
c) Breach
d) Impossibility or doctrine of frustration
e) Operation of law, i.e in case of Death, lapse of time, Merger
CIRCUMSTANCES IN WHICH A CONTRACT MAY BE FRUSTRATED
1. Destruction of Subject Matter.
2. Non-Occurrence of an Event.
3. Illegality.
4. Death or Permanent Incapacitation.
5. Government Interventions.
6. Supervening events
contract is not frustrated if:1. Either of the parties is to blame for the occurrence or non-occurrence of an event
2. The event is expressly provided for in the contract.
DISCHARGE BY PERFORMANCE EXCEPTIONS
1. Divisible contract
2. Substantial Performance
3. Partial Performance if Accepted
4. Prevented performance
5. Frustration of Contacts
6. Time of performance
Types of Breach of contract
Anticipatory
Actual
In Anticipatory Breach of Contract the innocent party should:1. Sue in Damages
2. Wait for the party to perform by the due date
3. Sue for Decree of Specific Performance
Whereas Common Law remedies comprise damages only, Equitable remedies include:
o Injunction
o Rescission
o Specific performance
o Account
o Tracing
o Quantum Mernit
o Winding Up
o Appointment of Receiver
Types of Damages
 Nominal
 Substantial
A court of law may decline to decree Specific Performance if;
1.
2.
3.
4.
5.
6.
7.
The contract is one of personal service e.g. employment.
The contract is revocable by the party against whom an order of specific performance is sought.
The contract is specifically enforceable in part only. Where the court cannot grant specific performance of the contract as a whole, it
will not interfere
The contract is incapable of being performed i.e. impossibility. Courts are reluctant to make ineffectual orders.
Performance of the contract requires constant supervision.
The decree is likely to subject the defendant to severe or undue hardship.
The contract in question was obtained by unfair means.
INJUNCTION- It is an equitable remedy whose award is discretional and may be granted in circumstance in which:  Monetary compensation is inadequate
 It is necessary to maintain the status quo
Types of injunctions may be classified as:
Prohibitory

Mandatory

Interim or temporary Injunction

Permanent or Perpetual Injunction
QUANTUM MERUIT
This literally means “as much as is earned or deserved”
This is compensation for work done. The plaintiff is paid for the proportion of the task
completed. The remedy has its origins in equity and its award is discretional. It may be granted
where: 1. The contract does not specify the amount payable.
2. The contract is divisible
3. The contract is substantially performed
4. Partial performance is accepted
5. A party is prevented from completing it undertaking.