Before ‘I Do’: Validity and Enforcement of Prenuptial Agreements in Kenya 

Posted on December 11th, 2018

By Georgina Ogalo-Omondi | Jill Barasa

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Issue No. 2 of this newsletter featured an article titled For Better or Worse: A Reflection on the Matrimonial Property Act, 2013 (the Act), in which we explored the salient features of the Act and introduced our readers to section 6(3) of the Act on prenuptial agreements. In the present article, we take a closer look at prenuptial agreements, which are gradually gaining recognition in Kenya as an efficient and cost effective way for couples to iron out, before entering marriage, property rights issues that could arise in the event of separation, divorce or death.

Legal Framework Governing Prenuptial Agreements Article 40(1)(b) of the Constitution of Kenya, 2010 (the Constitution) provides for the right to own property in any part of Kenya either individually or in association with others. Further, Article 40(2)(b), as read with Article 27(4), provides that Parliament shall not enact any laws that permit the State or any person to limit or in any way restrict the enjoyment of any right to own property on the basis of marital status.

Nevertheless, it was not until the enactment of the Act that prenuptial agreements gained official recognition in Kenya. The Act came into force on 16th January, 2014 and repealed the Married Women’s Property Act of 1882, which made no provision for prenuptial agreements. Its main objective is to provide for the rights and responsibilities of spouses in relation to matrimonial property and connected purposes. Section 6(3) of the Act provides that parties to an intended marriage may enter into an agreement prior to their marriage to determine their property rights. Indeed, in the case of MBK v MB (2016) eKLR, the Court was called upon to determine whether an apartment thatnthe defendant had bought prior to the marriage formed part of the
matrimonial property. The prenuptial agreement had only two clauses and provided, inter alia, that any property acquired by either party prior to their intended marriage would belong to that party after marriage. The Court held that since there was no evidence that the parties had agreed that the apartment would form part of the matrimonial property, it followed that the property belonged exclusively to the defendant.

Grounds for Invalidating a Prenuptial Agreement

Section 6 (e) of the Act provides that prenuptial agreements should be entered into freely by the spouses while section 6 (4) states further that a party to a prenuptial agreement may apply to the Court to set aside the agreement on the ground that the agreement was influenced by fraud, coercion or is manifestly unjust. However, the Act is silent on what amounts to fraud or coercion or what would render an agreement manifestly unjust.

It should be noted that common law principles and other laws of England have played an important role in shaping the history of Kenya’s legal framework. Kenyan jurisprudence has continually been influenced by that of England and as a result, English jurisprudence is still influential in Kenya. In fact, it is not uncommon for Kenyan Courts to refer to and apply English cases, particularly to fill gaps in the legislation or where certain matters have only recently been given force of law in Kenya and have not been dealt with in depth by the Courts, as is the case with the provisions on prenuptial agreements under the Act.

In England, the case of Radmacher v Granatino (2010) UKSC 42 provided the first significant judgment about the status of prenuptial agreements. In its judgment, the United Kingdom Supreme Court set out the following factors that increase the likelihood of a prenuptial agreement being binding the parties:

(i) The agreement must be freely entered into.
(ii) The parties must have a full appreciation of the implications of the agreement.
(iii) It must not be unfair to hold the parties to their agreement in the circumstances prevailing.

Before entering into a prenuptial agreement, it is important that each party seeks independent legal advice. Taking independent legal advice will aid in establishing that an individual was fully aware of the terms of the agreement and therefore freely entered into it, particularly if warnings were raised at a preliminary stage. For instance, in the case of DB v PB (2016) EWHC 3431 (Fam), the wife’s assertion of misrepresentation failed because it revealed that she had received independent legal advice in the United States advising her not to sign the agreement.

A person’s emotional state at the time of making the agreement is also relevant to whether the person entered into the agreement of his or her own free will, without undue influence or pressure. The Courts will also take into account the individual’s age and maturity and whether either or both had been married or been in long-term relationships before.

Timing is equally important and signing the prenuptial agreement immediately before the marriage increases the risk that one party will be considered to have put undue pressure on the other. The parties should have a full appreciation of the implications of the prenuptial agreement. This requires an exchange of financial disclosure before the agreement is signed to ensure that each party is aware of the extent of the claims he or she may potentially be giving up. On this point, in the case of Y v Y (2014) EWHC 2920, the Court refused to give effect to a French-style prenuptial agreement entered into by a French coupleliving in London who signed the agreement barely two days before their wedding. The Court took the view that while the wife had understood the function of the agreement when she signed it, she had not had any understanding of the financial consequences should the marriage breakdown.

The agreement must also be fair in the circumstances of the case. Concept of fairness has been subjected to much debate. The English courts have a broad discretion in financial remedy proceedings and at an absolute minimum will seek to ensure that both parties’ needs, and in particular the needs of the financially weaker party, and the needs of any children of the family are met. As a general rule, the longer the marriage, the lower the chance that the prenuptial agreement will be upheld, particularly if there have been significant or unforeseen changes in circumstances. In the case of WW v HW (2015) EWHC 1844, the Court accorded significant weight to the prenuptial agreement and went on to find that it would be fair to hold the husband to its terms unless his needs dictated a different outcome.

Way Forward

In view of the provisions of the Act on prenuptial agreements and the jurisprudence, couples contemplating signing a prenuptial agreement should be mindful of the following points:
• The parties should seek independent legal advice as a prerequisite to signing the agreement, even where one of the parties insists that he or she has read and understood the terms of the agreement, the rights and obligations that he or she will be surrendering. This is an essential element as it tends to show that the agreement was freely entered into by the parties without coercion or fraud.
• The parties should make full and frank disclosure of all of their assets including those that they intend to exclude under the prenuptial agreement. This is a requirement at common law.
• The parties should note that the agreement could be set aside by the Courts on the ground that it was unfair or manifestly unjust; therefore, the parties should ensure that the agreement does not have the effect of producing gross inequality between them either at the time of execution or during the marriage and that the division of assets is not weighted too heavily in favour of one party.
• The right of the child to support should be addressed prior to signing the Agreement, noting that the interests of the child take precedence over all other interests under Kenyan law. As was held in Radmacher v Granatino, the agreement cannot be allowed to prejudice the reasonable requirements of any children of the family.
• While there is no minimum time requirement for a party to review and sign a prenuptial agreement under the Act, the position at common law appears to be that prenuptial agreements must not be entered into less than twenty-one (21) days before the marriage.
• Signing the prenuptial agreement closely before the wedding is not recommended. The party initiating the process should therefore ensure that the other party is provided sufficient time to review the prenuptial agreement and the financial disclosures.

Consumer Protection Law in Kenya

Posted on October 17th, 2018

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Prior to the promulgation of the Constitution in the year 2010, there was no specific law dealing with consumer protection in Kenya. However, some aspects of consumer protection were covered in various pieces of legislation including the Trade Descriptions Act, Standards Act, Weights and Measures Act, Restrictive Trade Practices, Monopolies and Price Control Act (now known as the Competition Act), the Foods, Drugs and Chemical Substances Act, the Pharmacy and Poisons Act, the Public Health Act, the Fertilizers and Animal Foodstuffs Act, as well as private law measures in the law of contract and the law of tort.

These and other statutes touching on consumers are criminally oriented as they seek to ban one malpractice or the other and to prosecute offenders for breach of their provisions, but do not empower a consumer to sue the offender to get redress, including compensation, where the said breach affects him or her adversely. Herein lay the major set-back in protection of consumers under these statutes.

It is in this regard that the Article 46 of the Constitution of Kenya 2010 and its enabling statute, the Consumer Protection Act, 2010 are lauded as landmark achievements in the area of consumer protection. These new laws spell out consumers’ rights and obligations vis-a-vis product and service liability; they make provisions  for  the  promotion  and  enforcement of consumer rights as well as empower consumers to seek redress for infringement of their rights as consumers; and also provide for compensation.

Part II of the Act gives consumers a wide range of rights including the right to commence legal action on behalf of a class of persons in relation to any contract for the supply of goods or services  to  the  consumer.  This  right  cannot be ousted by any agreement between the parties. Other consumer rights provided for in the Act include the right to full pre-contractual information for the consumer to make an informed choice, the right to complain with regard to quality, delays in provision of rectification, quantity and price of such goods or services as are offered, the right to a reasonable notification of termination of service – particularly in relation to the provision of basic telecommunications services and/or internet access, among other rights.

The Act prohibits ‘unfair practices’ and proceeds to provide for radical sanctions against a supplier who engages in ‘unfair practices’. Such practices  include  representing  that  goods or services have a sponsorship, approval, performance or characteristics that they  do not  have; or representing that goods or services are of a particular standard, quality, grade, style or model, if they are not, and so on.

Therefore where a consumer enters into an agreement, whether oral or written, after or while a person has engaged in an unfair practice, the Act provides that the consumer has the right to terminate the agreement and seek any remedy available to them in law, including a suit for damages.

Undoubtedly, the Consumer Protection Act is a far-reaching piece of legislation that will affect different sectors of our economy including real estate, e-commerce, manufacturing, agriculture, banking and finance, aviation, among many others. In this connection, the Act establishes the Kenya Consumers Protection Advisory (CPA) Committee that shall aid in the formulation of policy related to consumer protection, accredit consumer organisations, advise consumers on their rights and responsibilities, investigate complaints and establish conflict resolution mechanisms amongst other duties. A breach of any regulation made by the CPA, will make a person liable to a fine not exceeding five hundred thousand shillings or imprisonment for a term not exceeding two years or both such fine and imprisonment.

In conclusion, although consumer protection law within Kenya is very much in its infancy, there have been several significant developments in this area over the last three years, namely the promulgation of the new  Constitution  in  2010 and the subsequent enactment of the Consumer Protection Act, which came into effect in 2013 as well as enactment of the Competition Act, 2010. The Competition Act protects consumers from unfair and misleading market conduct.

Indeed the increased consumer protection has seen the formation of the Consumer Federation of Kenya (COFEK) which was registered on 26th March, 2010 and whose mandate is:

“to defend, promote, develop and pursue consumer rights as guided by Article 46 of the Constitution of Kenya 2010, the Consumer Protection Act, 2012 and the Competition Act, Cap 504 and make it possible for the consumers to get value for money.”

COFEK has been at the forefront in acting as a watchdog in various consumer protection matters with the most recent being the institution of a suit against a leading retail supermarket for the alleged overcharging of items on its shopping tills brought about by the shelf and till price discrepancies at its outlets.

Sweeping Changes in Kenya’s Disputes’ Regime: The New Magistrates’ Courts Act, 2015

Posted on September 12th, 2018

Changing times beckon in the Kenyan Magistrates Courts, as marked by the enactment of the Magistrates’ Courts Act, 2015 (the Act) which came into commencement on 2nd January, 2016. The Act confers jurisdiction, functions and powers on the magistrates’ courts and provides for the procedure of the magistrates’ courts

According to the law, in exercising its authority, a magistrate’s court shall be guided by the principles specified under the Constitution in Article 10 on the national values and principles of governance, Article 159 on the principles guiding the exercising of judicial authority and Article 232 – with regards to the values and principles of public service.

In light of the backlog that has otherwise become synonymous with the Kenyan Courts the Act’s new objective  to enable the Magistrate courts to facilitate just, expeditious, proportionate and accessible judicial service in the exercise of criminal and civil jurisdiction is obviously a welcome relief towards easing the backlog of cases.

A magistrate’s court shall be subordinate to the High Court and shall be presided over by a chief magistrate, a senior principal magistrate, a principal magistrate, a senior resident magistrate or a resident magistrate. The Court shall exercise criminal jurisdiction as conferred on it by the Criminal Procedure Code or any written law. This is in line with the general principle that any crime and its punishment must be prescribed by written law.

One of the most notable changes in terms of the expansion of the jurisdiction of the Magistrates Courts is with regard to the increase of the pecuniary jurisdiction in relation to proceedings of a civil nature. For instance, the pecuniary jurisdiction where the Court is presided over by a chief magistrate has been increased from KES 7 million to KES 20 million shillings. The Chief Justice is however empowered to revise the pecuniary limits of the civil jurisdiction by a Gazette notice, by taking into account inflation and prevailing economic conditions.

The Act retains the jurisdiction of the magistrate’s court in proceedings of a civil nature regarding African customary Law on specified matters such as land held under African customary tenure; marriage, divorce, maintenance or dowry; Seduction or pregnancy of an unmarried woman or girl; enticement of, or adultery with a  married person; matters affecting status and, in particular the status of widows and children including guardianship, custody, adoption and legitimacy; and Intestate succession and administration of intestate estates, so far as they are not governed by any written law.

The Court now has jurisdiction over claims relating to violation of human rights only on rights guaranteed under Article 25 (a) of the Constitution dealing with freedom from torture and cruel, inhuman or degrading treatment or punishment; and Article 25 (b) of the Constitution dealing with freedom from slavery or servitude.

Presently, the magistrates’ courts can hear claims in employment and labour relations subject to the pecuniary limits under the Act.  They can also hear and determine environment and land cases subject to the pecuniary limits. The type of environment and land cases that can be heard include claims relating to environmental planning and protection, climate issues, land use planning , title, tenure, boundaries, rates, rents, valuation, mining, minerals and other natural resources; compulsory acquisition; land administration and management.

Furthermore, the court can now adjudicate over matters relating to contempt of court other than contempt that occurs in the face of the court. A person who commits contempt can be sentenced to imprisonment for a term not exceeding five days or a fine not exceeding KES 100,000 or both.

The Act introduces a court administrator to be appointed by the Judicial Service Commission and shall be responsible for among others, the day to day administration of the Court. The Chief Justice is expected to make rules for the effective organization and administration of the Magistrates courts to cover among others, the automation of court records, case management, protection and sharing of court information and the use of information communication technology.

Whereas the Chief Justice is expected to take measures as may be necessary for the supervision and inspection of magistrates’ courts, including prescribing a code of conduct for magistrates within six months of the Commencement of the Act, it must always be borne in mind at all times that the courts are subject to the supervisory jurisdiction of the High Court as a check mechanism.

A copy of the new Act, can be found here

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Doing Justice: The New Statutes Changing Kenya’s Dispute Resolution System

Posted on July 29th, 2018

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Critics of Kenya’s judiciary and the justice system have for long complained about the backlog of cases and the slow turning wheels of justice. It is however worth noting that there have been significant steps towards clearing the backlog of cases in the recent years. 2016 was no exception and a few inroads were made including, but not limited to various legislation that will without a doubt enhance the dispensation of justice.

First, is the implementation of the court-mandated mediation pilot program in both the commercial and family divisions of the High Court, which is a move towards fostering alternative dispute resolution without necessarily severing business relations; the establishment of the Anti-Corruption and Economic Crimes Division of the High Court and the inauguration of various courts such as the High Court stations at Narok, Kiambu and Baringo but to name a few.  The Court is in addition, fast-tracking old matters with a move to clearing the perennial backlog of cases.

A notable legislative development is the Small Claims Court Act, No. 2 of 2016 (SMCA), which establishes the Small Claims Court a subordinate court with a pecuniary jurisdiction of KES 200,000.  However, the Chief Justice may determine the pecuniary jurisdiction in a Gazette Notice.  The small claims courts are to be accessible in every county, as well as in other decentralized units of judicial service delivery. The Small Claims Court shall be guided by the same constitutional principles that guide other courts that are established in the Constitution. Under the SMCA, a Small Claims Court has jurisdiction to deal with any civil claims relating to matters such as:  contracts for sale and supply of goods or services; contracts for money held and received; liability in tort in respect of loss or damage to any property, for the delivery or recovery of movable property; compensation for personal injuries; and set-off and counterclaim under any contract. The Court may further exercise any other civil jurisdiction as conferred on it by written law.

There are however matters that the Court cannot deal with such as matters relating to defamation, libel, slander, malicious prosecution, disputes regarding titles or possession of land, or employment and labour relations. There are certain conditions which must be met before a party lodges a claim before the Small Claims Court, these include that they must ordinarily reside or carry on business within the local limits of the jurisdiction of the Court; the subject matter of the claim must be situated within the local limits of the jurisdiction of the Court; the contract to which the claim relates must either have been made or be intended to be performed within the local limits of the Court; the cause of action must have arisen within the local limits of the Court; or the Defendant to the claim must reside  within  the local limits of the court’s jurisdiction.

It is interesting to note that the SMCA provides that a party to the proceedings shall appear in person or where they are unable to appear in person, be represented by a duly authorised representative who shall not be a legal practitioner.

In a move to ease things, the Act excludes the strict application of the rules of evidence. It is further worth noting that under the SMCA, the Small Claims Court shall be presided over by an adjudicator who must be an advocate of the High Court of Kenya, with at least three years experience in the legal field and who may in addition, serve on full or part-time basis. The Act does not preclude a person from lodging a claim that is within the jurisdiction of the Small Claims Court in any other court if they elect to do so.

Additionally, the Access to Information Act No. 31 of 2016 (AIA), now gives effect to Article 35 of the Constitution which provides for the right to access to information. It also confers on the Commission on Administrative Justice, the oversight and enforcement functions and powers relating to the right.  Under the AIA, a public body is required to facilitate the access to information held by it. At a minimum, the information is to be provided for inspection without any charge, by supplying a copy on request for reasonable charge to cover the costs for copying and supplying the information.

There are limits to the right of access of information in accordance with the provisions of Article 24 of the Constitution. This includes information whose disclosure is likely to:  undermine the national security of Kenya; impede the due process of law; endanger the safety, health or life of any person; involve the unwarranted invasion of the privacy of an individual other than the applicant; substantially prejudice commercial interests of the entity or third party from whom it was obtained; cause substantial harm to the ability of the government to manage the economy of Kenya; significantly undermine a public or private entity’s ability to give adequate and judicious consideration on which a final determination has not yet been made; damage a public entity’s position on any actual contemplated legal proceedings or infringe on professional confidentiality.

A Court may require a public entity or private entity to disclose information where the public interest in disclosure outweighs the harm to protected interests. However, where information is readily accessible by other means, a public body is not obliged to supply information on such a request. The AIA provides timelines within which an application for access to information is to be considered. The AIA has provisions which enable an applicant to write to the Commission on Administrative Justice to review a decision by a public entity or private body in relation to a request for access to information. A party who is dissatisfied with a decision of the Commission may appeal the same to the High Court within set timelines.

A game changer is the Legal Aid Act No. 6 of 2016 (LAA), which gives effect to various provisions of the Constitution which facilitate the access to justice and social justice. It also establishes the National Legal Aid Service (the Service), provides for legal aid and for the funding of the legal aid. The functions of the Service include among others, to establish and administer a national legal aid scheme that is affordable, accessible, sustainable, credible and accountable. Also, to take necessary steps to promote public interest litigation with regards to consumer protection, environmental protection and any other matter of special concern to marginalized groups. Not all matters and people qualify for legal aid. The Service shall provide legal aid services at the expense of the State to persons who qualify for legal aid services. Under the LAA, legal aid services are provided in civil, criminal, children, constitutional and public interest matters as well as any other types of case or law that the service may approve.

The following persons are eligible for legal aid:

  1. A citizen of Kenya;
  2. A child;
  3. A refugee under the Refugees Act No. 13 of 2006;
  4. A victim of human trafficking; or
  5. An internally displaced person; or
  6. A stateless person.

A person who is eligible to receive legal aid is required to apply to the state in the prescribed manner and they shall not receive legal aid services unless the Service determines that their financial resources make them eligible for the services. The applicant may apply in person or through any other person authorised by the applicant in writing or through any person or organisation authorised by the applicant in writing on behalf of the applicant or on behalf of the Applicant where the applicant’s authority cannot be reasonably obtained due to physical or mental incapacity.

Legal aid is not available for civil proceedings relating to:

  1. A company, corporation, trust, public institution, civil society, non-governmental organisation or other artificial person;
  2. Tax matters;
  3. Debt recovery matters;
  4. Bankruptcy and insolvency matters; and
  5. Defamation proceedings.

In paying homage to alternative dispute resolution as espoused under the Constitution, the Service may, where it deems it necessary, recommend an aided person to alternative forms of dispute resolution and may for that purpose, provide them with such services at the expense of the Service.

Fourth on the list of recent notable disputes’ legislation is the Contempt of Court Act No. 46 of 2016 (COCA). This is an interesting Act of Parliament that defines the powers of the Courts in punishing Contempt of Court offenders. It is a well established legal principle that Courts do not act or issue orders in vain. Previously, the law relating to contempt was based on English law on Contempt of Court by virtue of Section 5 of the Judicature Act, (Cap 8 of the Laws of Kenya) and more recently, several provisions in both the High Court (Organization and Administration) Act No 27 of 2015 as well as the Court of Appeal (Organization and Administration) Act No. 28 of 2015 which provisions have since been repealed by the COCA.

COCA now provides for the law relating to contempt in one statute. It defines civil contempt to include wilful disobedience of any judgment, decree, direction, order or other process of a court or wilful breach of an undertaking given to a Court. It also defines criminal contempt to mean the publication of any matters or the doing of any act which scandalizes or tends to scandalize, or lowers the judicial authority or dignity of the Court, or prejudices, or interferes, or tends to interfere with the due course of any judicial proceeding, or interferes, or tends to interfere with, or obstruct, or tends to obstruct the administration of justice. Every superior court, (being the Supreme Court, Court of Appeal, High Court, the Environment and Land Court and the Employment and Labour Relations Court) has power to punish for contempt in the hearing of the court; punish for Contempt of Court in addition to uphold the dignity and authority of subordinate courts. Every subordinate Court shall on the other hand, have power to punish for Contempt of Court in the hearing of the Court.

Under COCA proceedings for criminal contempt can only be instituted by or with the consent of the Director of Public Prosecutions with the leave of the Court, or on the motion of a Court, having jurisdiction to deal with criminal Contempt of Court. The Act provides for elaborate defences to the offence of contempt. It is interesting to note that trial for Contempt of Court shall not constitute double jeopardy. The Act prescribes the punishment for the offence of Contempt of Court whereby upon conviction one is liable to a fine not exceeding KES 200, 000 or to imprisonment for a term not exceeding six (6) months or to both.

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