WEEK 5: PROFESSIONAL UNDERTAKING
Essential Readings
F T. O. Ojienda, Conveyancing: Principles and Practice (Nairobi: LawAfrica, 2007)Ch 3
P.L. Analo, Land Law and Conveyancing in Kenya
Law Society of Kenya Guidance on Professional Undertakings
The Law Society of Kenya Digest of Professional Conduct and Etiquette, Rule 46
The Land Act, 2012
The Land Registration Act, 2012
1) INTRODUCTION
In the course of most conveyancing transactions, it is common for advocates to
enter into written agreements to do or refrain from doing certain things. These are
called professional undertakings. These agreements help speed up the process of
conveyancing.
They also help circumvent problematic areas. From a viewpoint of a professional it
should be noted that:
1) An undertaking creates a legal obligation upon the advocate which is
enforceable by courts by way of mandatory injunctions and court orders. In
this respect, the ability to enforce a professional undertaking is vested solely
on the courts. All courts over the world have a supervisory jurisdiction over
its officers. It is on this basis that courts can enforce an undertaking and
make such orders as it deems appropriate to enforce the undertaking e.g.,
order a fine, jail term etc.
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2) The giving of a professional undertaking by an advocate places on him/her
an ethical obligation to comply with the same i.e., undertakings are deemed
sacrosanct. The Law Society of Kenya (LSK) is usually the body concerned with
ethical conduct of advocates and this ethical side of undertakings gives the
undertaking its value. LSK can, if it finds one guilty of breaching an undertaking,
fine one, suspend or even strike an advocate’s name off the Roll of Advocates.
Definition of Undertaking
According to the Law Society of Kenya Guidance on Professional Undertakings:
An undertaking is an unequivocal declaration of intention addressed to someone who reasonably
places reliance on it and made by an Advocate in the course of his practice, either personally or by a
member of the Advocate's staff whereby the Advocate (or in the case of a member of his staff, his
employer) becomes personally bound.
The Guide to the Professional Conduct of Solicitors defines an undertaking as follows:
―An undertaking is any unequivocal declaration of intention addressed to someonewho reasonably
places reliance on it and made by:
i. A solicitor or a member of a solicitor’s staff in the course of practice, or
ii. A solicitor as solicitor but not in the course of practice.1
Put in simpler terms therefore, a professional undertaking is a promise by an advocate
to do or refrain from doing something. An undertaking should be in a form which is
clear and once accepted by the advocate shall be binding on him or his firm and any
breach thereof shall constitute professional misconduct.2 Consequently the Law Society
of Kenya will require the implementation of a professional undertaking as a matter
ofconduct.
Thus, as stated in Peter Ng’anga Muiruri v Credit Bank and Charles Ayako Nyachae t/a
Nyachae & Co. Advocates, it is important to be cautious when giving a professional
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undertaking as once it’s given, it cannot be revoked and should be performed.3
1 James Murimi Githinji v John Ngure Mbugua [2008] eKLR.
2 The Law Society of Kenya Digest of Professional Conduct and Etiquette, Rule 46
3 Civil Appeal No. 263 of 1998 (Court of Appeal at Nairobi).
In this case, the appellant sought to enforce an alleged undertaking given by Messrs.
Nyachae & Company Advocates to another firm, Messrs F.N. Wamalwa & Co.
Advocates, for the payment of the suit sum plus interest thereon. The suit sum was to be
held in a joint interest earning account. Subsequently, the firm of Nyachae and Company
breached its professional undertaking by failing to deposit the said money in a joint
interest earning account, principally on the ground of a collateral dispute as to the
meaning and purport of the undertaking and the amount. The Court in issuing an
order against the firm to deposit the amount to the bank within 30 days stated that, ‘An
undertaking is a solemn thing. In enforcing undertaking the court is not guided by
considerations of contract,but the court aims at securing the honesty of its officers.’
Context
Where an advocate who is acting professionally for a client gives his/her personal
undertaking in that character to the client or to a third person, or gives an undertaking to
the court in the course of proceedings, that undertaking may be enforced summarily upon
application to the courts. Before this remedy can be pursued it must be shown that the
undertaking is given by the advocate personally, and not merely as agent on behalf of
his/her client. The undertaking must also be given by the advocate, not as an individual, but
in his professional capacity as advocate.
The jurisdiction is based upon the court's right to require its officers to observe a high
standard of conduct; it is immaterial that no misconduct on the part of the advocate is
suggested. The advocate cannot, therefore, defend himself/herself on the ground that his/her
undertaking is not enforceable as a contract against him/her, or on the ground that the
application has been delayed. Nor will an undertaking given under a mistaken belief of
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having authority to fulfil it be set aside; nor can the advocate withdraw from his/her
undertaking save by consent; but an undertaking given by mistake in too wide terms will
not be enforced insofar as it was mistakenly given.
The undertaking must be clear in its terms. The whole of the agreement to which it
relates must be before the court, and the undertaking must be one which is not impossible
ab initio for the advocate to perform. Nevertheless, an undertaking will be enforced against
the advocate even though, after it is given, the client dies or instructs the advocate not to
perform it, or changes his/her advocate. If performance of the undertaking has been waived
the undertaking will not be enforced afterwards. Similarly, if the undertaking is
conditional,the condition must be fulfilled before the undertaking will be enforced.
Order 52 Rule 7 of the Civil Procedure Rules 2010: Application for order for enforcement
of an undertaking
7 (1) An application for an order for the enforcement of an undertaking given by an
advocate shall be made—
(a) if the undertaking was given in a suit in the High Court, by summons in
chambersin that suit; or
(b) in any other case, by originating summons in the High Court.
7 (2) Save for special reasons to be recorded by the judge, the order shall in the first instance be
that the advocate shall honour his undertaking within a time fixed by the order, and only
thereafter may an order in enforcement be made.
Principles on Professional Undertakings
There are thirteen principles relating to professional undertakings in Kenya. The
LSK lists them as follows:
1. An undertaking is an unequivocal declaration of intention addressed to
someone who reasonably places reliance on it and made by an Advocate in the
course of his practice, either personally or by a member of the Advocate's staff
whereby the Advocate (or in the case of a member of his staff, his employer)
becomes personally bound
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There is no obligation on an Advocate either to give or accept an
undertaking, nor can an Advocate be required to stand guarantor for a
client by way of an undertaking.
The Society does not recommend the giving or accepting of oral
undertakings. Oral undertakings can lead to uncertainty as to the
nature and extent of the undertaking. Evidential problems may arise.
When oral undertakings are given, the lack of formality detracts from the
gravity which should be attendant on thegiving of any undertaking.
The Society recognises that an oral undertaking given by one person to
another may be enforceable at law, but the Society will not render
assistance to a party seeking to enforce that undertaking as a matter of
conduct. (This does not apply to oral undertakings given to a Court).
See KCB v Adala [1983] KLR 487 where an undertaking in favour of a
layman enforced. The undertaking was not directed to an advocate but
was enforced against the advocate.
Because the promise is given by an advocate, he/she is personally
bound by it even if his/her client dies or becomes bankrupt. Hence, an
advocate must always consider if he/she has control over the undertaking.
An advocate may thus have to give a qualified undertaking if in doubt
of enforcement of the undertaking. For instance, I will pay you Kshs X
upon receipt of the same from my client.
2. Failure by an Advocate to honour the terms of a professional undertaking is
prima facie evidence of professional misconduct. Consequently, the Society
will require its implementation as a matter of conduct.
The Society has no power to order payment of compensation or to
procure the specific performance of an undertaking if a Advocate
declines to implement it. The Society will proceed by way of
disciplinary action for failure to honour theundertaking.
The Society will require an undertaking to be honoured by Advocates
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for so long as their names remain on the roll and regardless of whether
they hold current practising certificates or not.
The Society has no power to order the release of a Advocate from the
terms of an undertaking. This is a matter for the court, or the person
entitled to the benefit of the undertaking.
3. An undertaking will normally be required to be honoured only as between
the giver and the recipient.
The Society will normally require compliance with an undertaking only at
theinstance of a recipient.
An Advocate cannot assign the burden of an undertaking (and thus claim to
bereleased from its terms) without the express approval of the recipient.
See Naftali Radier v Njogu t/a Njogu Advocates & Co HCCC 532 of 2002; An
advocate cannot assign an undertaking without the recipients consent.
Ron Otieno v AGN Kamau & Co Advocates HCCC 134/03: The
defendant’s advocates had given an undertaking under their former name
which partnership had since been dissolved; when the plaintiff sought to
enforce the undertaking, Mr. Kamau argued that a former partner Ms
Kimani walked away with some liabilities including the undertaking. It
was held that the undertaking was joint and several, that is, personal to
Mr. Kamau and he could not walk away from it.
4. An ambiguous undertaking is generally construed in favour of the recipient.
See Karsam Lalji v P. K. Kimani t/a Kimani Kairu & Co. Advocates CA 135
of 1999: Advocate was ordered to pay monies owed under an
undertaking together with interest although no interest was provided
under the undertaking.
5. An undertaking does not have to constitute a legal contract to be enforceable
in conduct.
No consideration is necessary for an undertaking to be enforceable in conduct.
6. An undertaking is still binding even if it is to do something outside the
Advocate's control.
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Before giving any undertaking a Advocate must carefully consider
whether it will be possible to implement it. It is no defence to a
complaint of professional misconduct that the undertaking was to do
something outside the Advocate's control.
7. An Advocate is responsible for honouring an undertaking given by a member
of the Advocate's staff, whether admitted to the Roll of Advocates or not.
Where a partner or associate Advocate gives an undertaking, the conduct
of the assistant may also be called into question by the Society.
8. Where an Advocate in partnership gives an undertaking as a Advocate in the
course ofpractice, all partners are responsible for its performance.
A partner remains responsible for the firm's undertakings even after
that Advocate leaves the firm or the partnership is dissolved.
9. An Advocate cannot avoid liability on an undertaking by pleading that to
honour it would be a breach of duty owed to the client. Since a Advocate will
be personally bound to honour his undertakings, it is essential for the
Advocate's protection that the client's authority to do so is given before the
undertaking is furnished.
10. An Advocate who gives an undertaking which is expressed to be dependent
upon the happening of a future event must notify the recipient immediately if
it becomes clearthat the event will not occur.
11. In addition to the Society's power to enforce undertakings as a matter of
conduct, the court, by virtue of its inherent jurisdiction over its own officers,
has power of enforcement in respect of undertakings.
Where undertakings are given by Advocates to the court, the Society
takes the view that enforcement is a matter for the court; for this reason
the Society willnot normally intervene.
12. An undertaking should not be given by an Advocate as an inducement to a
client to secure that client's business.
13. The seeking by an Advocate of an undertaking from another Advocate which
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the first Advocate knows, or ought to know, should not be given, may be
deemed to be professional misconduct.
Professional Undertakings and Land
Transactions
Professional undertakings are used by lawyers to smoothen and hasten the process of
land transactions that would not otherwise be possible. Accordingly, they create an
avenue for competing transactions which may never be completed as banks would not
release funds without the registration of a transfer or charge. The seller may also face
the risk of losing his/her property to a purchaser who may fail to release the purchase
price after registration.
Instances
There are a number of instances whereby professional undertakings may be issued to
hasten conveyancing transactions and these include where: A vendor’s advocate
undertakes not to release the purchase price to the vendor pending actual registration
of the transfer;
1. A purchaser’s advocate undertakes to hold completion documents to the
vendor’s order pending payment of the purchase price;
2. A chargee’s advocate undertakes to pay the loan proceeds upon registration of
the charge plus/or transfer simultaneously;
3. A chargor’s advocate undertakes to pay the redemption amounts upon
registration of the discharge;
4. With regard to lending/borrowing transactions pertaining to bank business,
professional undertakings are issued in transactions whereby a purchaser is being
financed by a bank;
5. Another instance would be where an individual wishes to get a loan from a
bank and use property that he/she already owns as collateral. A bank will not
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release funds to such individuals unless a charge over the individuals’
property is registered in the bank’s favour. The borrower on the other hand
risks having his land encumbered without having secured the funds he/she
requires from the bank. A professional undertaking will thus be used in such a
transaction with the effect that an advocate acting for the bank will issue the
borrower with a professional undertaking. Such an undertaking will be to the
effect that once the transfer and charge have been simultaneously registered,
funds will be remittedto the vendor.4
Key Cases:
Nelson Andayi Havi t/a Havi & Company Advocates v Jane Muthoni Njage t/a J.M Njage &
Company Advocates [2015] eKLR
In this case, a professional undertaking was given by the Defendant to the Plaintiff (both
being advocates). The Plaintiff represented the vendor while the Defendant was the
purchaser’s advocate in a land sale agreement for a sum of Ksh. 50 Million. An sale
agreement was negotiated and duly executed.
4Anne Kiunuhe, ‘Is It Time to Review the Professional Undertaking Rules?’ Business Daily
(Nairobi, 30 November 2010)
The Defendant furnished the Plaintiff a professional undertaking to pay the Ksh. 45
Million balance of the purchase price within 7 days of successful registration of the
conveyance in favour of the purchaser, or within 30 days of the release of the completion
documents (original title deed, transfer form and other completion documents required to
facilitate registration of the land transfer), whichever was earlier.
The Defendant defaulted on the undertaking by unduly delaying the registration
processand the release of the balance of the purchase price for over 8 months. The
Plaintiff thusclaimed interest of 17/5% as agreed in the contract for the delayed
completion under theundertaking based on the principle that an advocate should give an
undertaking only whenhe/she is in the funds as was enunciated in the case of Harit Sheth v
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K.H Osmond Advocate.5 The judge acknowledged that a professional undertaking between
advocate should properly be enforced by either of the advocates and not their prospective
clients. This is because none of the clients is a party to such an undertaking and as such
the clients have no privity ofcontract in the undertaking.
This point was affirmed in David Karanja Thuo t/a D.K. Thuo& Company Advocates
vS. Njagi Wanjeru t/a Njagi Wanjeru & Company Advocates.6 Justice Gikonyo relied on
the case of Naphatali Paul Radier v David Njogu Gachanja wherejustice Waweru held that
the Defendant, having withheld the Plaintiff’s money for a longtime was to pay interest.
Since no particular rate was contracted, the court proceeded toaward interest at court
rates. Gikonyo J added that the approach is meant to preventunscrupulous advocates
from keeping money entrusted to them for completion of atransaction for their own
use. In the particular case, since the parties had agreed on aninterest of 17.5% for
delayed completion, the same was applied for the breach of theundertaking due to
delayed completion. The sum of Ksh. 3,249,997 was thus awarded to the Plaintiff.
Kenya Reinsurance Corporation v V. E. Muguku Muriu T/A M/S. V. E. Muguku
Muriu& Company Civil Appeal No. 48 of 1994
5 Harit Sheth v K.H Osmond Advocate [2011] eKLR.
6 David Karanja Thuo t/a D.K. Thuo & Company Advocates v Njagi Wanjeru t/a Njagi
Wanjeru & Company Advocates [2008] eKLR. See also HK Advocate v Muciimi Mbaka
[2004] eKLR.
Professional undertaking – when there is a dispute between the advocate’s client and
the party to whom it is given-whether this might absolve the advocate from honoring
the undertaking.
FACTS:
By a letter dated 22 April 1986, the respondent advocate sought to know from the
appellant corporation the outstanding balance of a loan under a charge on a plot, to
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enable him to discharge and transfer of the property. He requested that title documents
be released to him upon his professional undertaking to redeem the mortgage. The
undertaking was unequivocal. He was undertaking to pay to the corporation a sum
of Ksh.499,023.95 plus interest thereon at the rate of Ksh. 140.50 daily until the date of
payment plus the smaller amounts mentioned in that letter. On being required to
honour the undertaking the advocate brought in the issue of alleged disputes between
his client and the appellant corporation to qualify his undertaking.
HELD:
1) Having given a solemn professional undertaking to pay a certain sum
ofmoney an advocate is bound and cannot resile therefrom.
2) The undertaking thus given was unambiguous unequivocal and
bindingon the advocate.
3) A careful advocate would obtain very clear instructions from his
clientbefore giving a professional undertaking on his behalf.
4) Appeal allowed judgment and decree of superior court set aside.
Karsam Lalji Patel v Peter Kimani Kairu Practising As Kimani & Co. Advocates
CivilAppeal No. 135 of 1999
Professional undertakings – Summary jurisdiction of the court
FACTS:
The appellant took out an Originating Summons in the High Court to enforce a
professional undertaking given by his advocate Peter Kairu that he refused to honour.
In the High Court, it was held that the advocates were not in breach of the undertaking.
HELD:
1. That the advocates should honour their professionals undertaking by paying
thepurchaser.
2. Appeal allowed
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A4 ADVOCATES
COMMISSIONER FOR OATHS| NOTARIES PUBLIC|
ARBITRATORS|CERTIFIEDPUBLIC SECRETARIES
OFFICE LINES OFFICE PARK BUILDING, EMAIL
1st FLOOR ADDRESSES
+254 777 777 771 LANGATA SOUTH ROAD [email protected]
[Link]
+254 777 777 772 P.O Box 1921 – 00100 A4advocates@gmai
[Link]
+254 777 777 773 NAIROBI, KENYA
OUR REF: A4/ 01/ 07/ 2018 YOUR REF: T. B. A July 17, 2018
BORA BANK LIMITED “BY COURIER”
P. O. Box 3457-
00100, NAIROBI,
KENYA.
Dear Sir/Madam,
RE: SALE OF PENTHOUSE P1 ON LAND REFERENCE NUMBER 209/
12347(I.R. 60509) TO TAJIRI TAYARI (PURCHASER)
We Messrs A4 & Associates of Post Office Box 1921-00100 Nairobi do herebygive our
Professional Undertaking in the following terms: -
1 That we shall hold the title documents in trust to your order returnable on
demand pending our payment to you the sum of Kenya Shillings Thirty-Three
Million Seven Hundred and Fifty Thousand Million Only (KES
33,750,000/=) outstanding within Fourteen (14) days from the date of
successful transfer in favour of the purchaser (Tajiri Tayari) and charge in
favour of Preferred Bank Limited;
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2 That if the amount as herein before advised in clause 1 is not forwarded to
you within Forty-Five (45) days from the date when the title documents shall
have been forwarded by yourselves to us, then we shall forthwith and
immediately upon demand return to you all the title documents that will
have been sent to us by you in the same condition in which they were on
leaving your offices. Should registration have taken place, then we shall
forthwith and immediately procure the simultaneous cancellation of the
registration of all the Title documents that will have been forwarded by
yourselves to us and the status quo before the giving of the Title documents
shall be forthwith reinstated; and
3 That by accepting, retaining or utilising the Title documents that shall be sent
by you to us, we shall be deemed not only to have accepted and confirmed
the foregoing undertaking, terms and conditions set forth herein above but
also to have acknowledged and confirmed that we are solely liable and
responsible for full compliance with the said undertakings, terms and
conditions and that we shall indemnify you fully in all respects on account
of any breach on our part of the said undertaking and terms and conditions
aforesaid.
Yours faithfully,
Winnie A – P105/0000/0000 – LSK/2018/0000
For A4 & Associates
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QUESTIONS TO CONSIDER
1. Give four instances of undertakings in land transactions.
2. On reforms, why do advocates deliberately fail to honour undertakings?
3. What are professional undertakings and how are they applied to
lending/borrowing transactions pertaining to bank business?
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