LAW

SOURCES OF LAW
They include:
 Common law
Also referred to as case law. Is a source of law that originated in England or from
previous landmark decisions which include.
 Laws made by judges in the form of precedent.
 Substance of the English law (common law) which is a doctrine of
equity
 African customary law in civil cases in which one or more parties
is affected by it
 Islamic law applied to personal status, marriage, divorce and
inheritance
 Custom
A branch of the law which is developed from customs, usages and cultural
practices of the people.

 Judicial precedent
Precedent is the reasoning behind a judge’s decision that establishes a principle or rule
of law that must be followed by other courts lower in the same court hierarchy when
deciding future cases that are similar.
Judicial precedent are judicial decisions. Rulings and decisions made by courts
become binding across the jurisdiction’s legal system. The different courts,
especially, the lower courts, are in this case required to stand by the previous
decision by a higher court, in similar future cases.
 Legislation
Legislation consists of the declaration of legal rules by a competent authority.
Legislation is the laying down of legal rules by a
sovereign or subordinate legislator. Law that has its source in legislation may be
most accurately termed “enacted law” all other forms are “unenacted”
May come from one of the following sources:
i. The constitution of Kenya which is the highest law in the land
ii. Acts of parliament
iii. Acts of the UK (a common practice among the common wealth
nations)
iv. Statutes of the general application
 Equity
Equity consists of rules developed based on the principle of fairness. Equity
developed to supplement, not to supplant the common Law. It developed as a
modification to the common Law; hence it is described as “a gloss on the common
Law”. Equity has an ordinary, legal and a technical meaning.
  In the ordinary sense, equity means fairness, justice, morality, fair play,
equality etc. We are talking about doing good, doing what is morally
right.
 In a legal sense, A litigant asserting some equitable right or remedy must
show that his claim has “an ancestry founded in history and in the practice
and precedents of the court administering equity jurisdiction”.
 In the technical sense equity refers to a body of rules and some authors
have defined equity as that which is not the common law. They distinguish
equity from the common law. It is regarded as a body of rules that is an
appendage to the general rules of law.

LAW OF CONTRACTS
Contract is an agreement between two parties which is legally binding. The agreement is either
to do or to abstain from an act or both parties must give something or having promised to give
something of value for benefit of either or both parties as a consideration of what is derived from
the agreement.
Contract is a note that is written or oral.
Basic elements of an Agreement (Interpretation and proof of contracts)
An agreement must be based on three principles:
i. It has to be an agreement in its true sense; there must have been an
offer and evidence of acceptance to the offer
ii. Valuable consideration; there must be something of value in the form
of benefit or prevention of possible injury or loss
iii. Intention to create legal relations; so that the agreement is
enforceable before a court of law

i. Two items of the agreement to be held in the eyes of law include:

 Offer
 Acceptance to offer
a) Offer
This is a statement of absolute willingness to be contractually bound on the terms
expressly or implied included in the statement. Two parties involved are: Offeror – the
party or person giving the offer and offeree – the party or person receiving the offer. The
terms of offer must be communicated to the offeree before the acceptance.

Ways of effecting the offer include:

i. The offer is made through an invitation from the offeror
 ii. Invitation to bid is only an offer if and when you offer to buy
iii. Offer to large audience is often done through advertisement on media with
wide circulation
b) Acceptance to offer
This is an expression of assent to the offer. The assent should be unconditional and
absolute i.e. there should be no vested interests (no strings attached). Once the offeree
accepts the terms of offer then it becomes a contract.
Qualified acceptance also called counter offer is when the offeree accepts the offer but
also includes his own additional terms to cater for the offeree`s interests, especially to
guard against any possible injury or loss. It can only be legally binding if the offeror
accepts it.
Termination of offer
It can be done in three ways:
 If the offer is rejected by the offeree
 Revocation by the offeror – which can only be done before acceptance by the offeree
 By lapse – upon expiry of time by which acceptance was to be communicated, failure
of consideration, death of offeree

ii. Valuable consideration

There must be serious and substantive issues:
 Price of the promise i.e. some rights, interests, benefits accruing from the undertaking
or bearing detrimental loss arising thereof
 Each of the parties must provide some consideration in respect to the promise
Rules governing the consideration include:
 Consideration must be worth something in the eyes of the law
 Each party must get something in return for their promise other than their own
entitlement
 The consideration must not conflict with the established law
 Consideration must not move from the promise
 Consideration must not relate to event in the past
 Every single contract requires consideration to make it valid

iii. Intention to create legal relations

Both parties must understand the legal engagement they are entering into. The contract entered
must be:
 Enforceable before a court of law
 Actionable and enforceable in the court
Form of Contract
Form is a peculiarity of procedure accompanying the agreement.
  The contract should be under seal i.e. can be executed or made effective by being signed,
sealed and delivered
 The exception is a simple contract which is without a signature, without a seal and no
delivery
Privities of Contract
This is an exclusion clause where only contracted parties can receive benefit from it. Only the
parties that are contracted can derive rights and benefits from it meaning that parties outside the
contract are none players
Contract of Utmost Good Faith or uberrimae fidei
This condition arises when parties to the contract are at very different levels of understanding of
contract details and specifics: i.e one party knows a lot about the subject being contracted than
the other
Express and Implied terms
 Express terms – are clearly stipulated in the contract which the parties intend to
be binding upon them; this is clear
 Implied terms – are those terms which although expressly stated by the parties
by words or deeds but are by law deemed to be part of the contract. Terms maybe
be implied in contract by custom, statute or court
Factors vitiating (spoiling) a contract
Vitiating means making the contract void for example the selling of goods which are found to
have expired at the time of sale makes the sale agreement void.
The factors include the following:
 Mistakes: bilateral mistakes and unilateral mistakes
 Non-disclosure of material facts
 Duress
 Capacity of the party
 Unenforceable contract
 Misrepresentation: innocent, negligent and fraudulent misrepresentation
Remedies of misrepresentation
The injured party has several options:
 We can affirm the contract so that it will continue, we accept to perform even
with misrepresentation
 We can refuse to perform the contract (repudiate the contract)
 Sue for recession and restitution
 We can sue for damages, only for fraudulent misrepresentation

Contract of guarantee and indemnity

Contract of Indemnity and contract of Guarantee are the contingent contracts under the contract law.
Guarantees and indemnities are a common way in which creditors protect themselves from the risk of
debt default. Lenders will often seek a guarantee and indemnity if they have doubts about a borrower's
ability to fulfil its obligations under a loan agreement.
Indemnity under the law means protection of the losses or financial burden in the form of money. It is
when one party promises to compensate for the losses that will occur due to the act of the promisor or
other party.
A contract of indemnity as laid down in Section 124 is a contract by which one party promises to save
the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other
person, is called a contract of indemnity

Guarantee is when a person gives the surety to the other party that if third party defaults, he/she will be
held responsible for that and will fulfil the obligations. A guarantee may be either oral or written.
A contract of guarantee is a Contract to perform the promise, or discharge the liability, of a third
person in case of his default” as per Section 126 of Contract Act 1872. A Contract of Guarantee is also
called surety. There can be no contract of guarantee without a liability enforceable a law.

INSURANCE MATTERS
Insurance may be undertaken in several ways to safeguard the interests of the contract. Various forms
insurance includes the following as shown in the table below:
NO. STAGE OF CONTRACT PROVISION FOR PURPOSE
INSURANCE
1 Tendering, evaluation and Bid bond No withdrawal of bid before award
appeal period
2 Tender award and Performance Protect employer`s interests. The bond
possession of site bond should be valid and be in force for the
duration of the contract
3 Contract execution Retention money Protect employer`s interests from
and performance unsatisfactory performance of works
bond
4 Maintenance period Second moiety First moiety (50% of retention money)
is released upon issuance of practical
completion certificate. The other half
is retained for the damages period
5 After maintenance period Final certificate to The final certificate takes care of all
contractor Issues including snag lists, any cost
of damages or variation orders
At the stage of advertisement, tender evaluation and award, bidders deposit the bid bonds with the
employer. The winning bidder submits and substitutes the bid bond with a performance bond while the
loser`s bid bonds are returned. Appeal by the losers of the bid can be done within 21 days
Performance Bonds
A performance bond is a financial tool used to guarantee satisfactory completion of a project by a
contractor and ensures that in the event of default by the contractor, funds are available to
complete the works being undertaken. Performance bonds are issued by banks as financial
guarantees. Performance bonds are usually set at 10% of the contract price. For construction
contracts, 50% may be released immediately on completion of the work, with the balance being
released after 6 months.
Performance bond can be in form of cash deposit or provision of a surety e.g a bank document
Necessity for bond
 Surety may become bankrupt
 Disappearance of surety
 The other party passes on

Sale of goods act as applicable to contract work

The Sale of Goods Act 1979 is an Act of the United Kingdom which regulates contracts in which goods
are sold and bought.
Sales of Goods Act, is a contract in which goods are sold and bought, it means whereby the seller
transfer the property in the goods to the Buyer for a consideration called price. The Sale of Goods Act
lays down a small number of compulsory legal rules concerned with an array of presumptions and
implied terms, which aim to reflect the commercial expectations in the most commonly agreed sales
contracts.
A contract of sale is a legal contract of an exchange of goods, services or property to be exchanged from
seller to buyer for an agreed upon value in money paid or the promise to pay same. It is a specific type
of legal contract.
Bankruptcy
When people are bankrupt, they still have general capacity to enter into contracts however, they are
subject to some limitations and their trustee in bankruptcy can intervene and disclaim contractual
obligations for a number of reasons. Therefore, it is important to be cautious when conducting
contractual dealings with a bankrupt.

Breach of contract
A party pursuing a claim for breach of contract will have to persuade a judge that the other party
did not carry out their obligations under the contract. A breach of contract can arise in the
following ways if someone:
  doesn’t pay for a service
 fails to pay on time
 does not deliver services or goods or is overly late in delivering goods or services
without a good excuse.
The main types of breach of contract are:
 minor breach of contract
Where a party fails to fulfil all the stipulations of the contract, but the failure to
do so is inconsequential and the remaining obligations under the contract are
capable of being carried out. In such cases, the non-breaching party will be able
to sue for damages if they have suffered loss, but they won’t usually be allowed
to terminate the contract.

 Material breach of contract

Where one or more of the main terms of the contract has not been carried out
and/or it is impossible for the contract to be completed. In these cases, the
contract can be terminated and the non-breaching party could claim damages if
they have suffered loss.

 Anticipatory breach of contract.

Where one party to the contract tells the other that they won’t be able to abide by
the terms of the contract. In these situations, the contract can be terminated and
damages sought.
Evidence will be required to prove a breach of contract. The evidence can be in the form of the
following ways
 Written evidence
There may be a formal written contract, but often written contracts are created by a
series of letters, faxes or emails. Even where there is a formal written contract, any
letters, faxes or emails sent around the time the contract was created often provide useful
evidence to show what the parties intentions were if the formal written contract is
unclear or fails to deal with a point which has arisen since the contract was formed.
Often a contract will be governed by a party’s standard terms and conditions. These will
provide evidence of the terms of the contract. The party who is relying upon the standard
terms and conditions will, however, also have to provide evidence to show that they
were incorporated into the contract. In most cases they will simply have to show that the
other party was aware of the existence of the standard terms and conditions. Such
evidence typically consists of correspondence referring to the standard terms and
conditions or reference to them on order forms. Written evidence of a breach could arise
where the breaching party writes to the other party and admits that they can no longer
afford to pay for the goods or services they contracted to buy. This letter would be
evidence that a material term of the contract had not been carried out.

 Oral evidence
 Where there is no written evidence of the existence or terms of a contract the
parties will have to rely on their own oral evidence. To succeed in a civil case, a
party will have to persuade a judge that their version of events is more likely than
the other party’s version of events. If someone else was present when the contract
was entered into, they could provide valuable evidence in situations such as this.

 Expert evidence
In cases which involve specialist knowledge on a matter and where it would
assist the court for an expert in a particular field to explain a technical point, it is
common for an expert to give evidence to the court, usually in the form of a
written report. The evidence of a surveyor would, for example, provide useful
evidence in a dispute involving building works.

 Other types of evidence

In some cases, photographic or video evidence will be valuable. For example, in
a claim brought by a holiday maker who was sent to a hotel of a different
standard to that which was shown in the brochure.

LAW OF TORT
Tort is a conduct that harms other people or their property. It is a private wrong against a person
for which the injured person may recover damages, i.e. monetary compensation. The injured
party may sue the wrongdoer (tortfeasor) to recover damages to compensate for the harm or loss
incurred.
Features of law of tort
 This is a civil wrong for which redress is available before court of law (inform of
compensation)
 The compensation is made in return for the injury that is suffered by the aggrieved party
i.e this is made before the tort
 Tort and contract differ in that in contract the agreement is made between two parties but
in tort the wrong is against the society where there was necessarily no written contract
 A note to an individual can be punishable by society in the form of criminal procedures
which are designed to address the wrong
Specifics to the engineer
Two aspects related to the engineer are careless acts and negligence
 Careless acts: errors in calculation, poor suspension

Negligence
 Negligent advice which gives rise to defendant and plaintiff
 Defendant – one who defends himself in court
 Plaintiff – complainer in court
  Negligence is a breach of legal duty to take care which results to damage which is
undesired by the defendant to the plaintiff i.e Conduct by the defendant is not intentional
 Professional negligence
A case where a professional person expected to exercise the standard of care that
a reasonably competent practitioner in that field can exercise is not able to
exercise that standards of work.
 Contributory negligence
A case where the plaintiff suffers damage partly due to his own fault and by the
fault of another person. The damage recovered by the plaintiff should be reduced
by taking into account the plaintiff`s share of liability to the damage.
Liabilities that arise out of negligence are
i. There is existence for duty of care, foresee that what you do affects other people
ii. A breach of this duty (to take care) must be established and that the standard of contract
has been exhibited by the reasonable action in your circumstances
iii. There has to have been damage caused to the plaintiff as a consequence of the
defendant’s breach of duty
Limitation of action as a result of negligence
Three years is the limitation of action for negligence giving rise to personal injury or six years
from the time the owner (plaintiff) becomes aware of the effect
Vicarious Liability
A case where a person has committed a tort and another person may be liable although he has not
actually committed it. In this case both the persons are liable as joint tort (common in cases of
master-servant relationships or agent). A master is liable for the tort of his servant who commits
it in line of his duty/employment
Strict Liability
Strict or absolute liability is the legal responsibility for damage or injury, even if the person
found strictly liable was not at fault. In order to prove strict liability in tort, plaintiff needs to
prove only that the tort happened and that the defendant was responsible for the act or omission.
In the case of strict liability in the USA, neither good faith nor the fact that the defendant took all
possible precautions is a valid defence. A common example of strict liability is imposing product
liability in the case of defectively manufactured products. Strict liability applies especially in
cases involving hazardous or dangerous activities.
Trespass
A trespass is an unauthorized action with respect to a person or property. A trespass to the person
consists of any contact with someone’s property for which consent was not given. It is an
invasion of a person’s interest in the exclusive possession of their land.
Nuisance
Nuisance is a civil wrong, consisting of anything wrongfully done or permitted that interferes
with or annoys others in the enjoyment of their legal rights. It is anything that annoys or disturbs
the free use of one’s property or that renders its ordinary use or physical occupation
uncomfortable. A nuisance is anything that interferes with the rights of citizens, the enjoyment of
their property, or their comfort. It is to be noted that an unreasonable interference with another
person’s use and enjoyment of his/her property is determined by the injury caused by the
condition and is not determined by the conduct of the party creating the condition. A nuisance is
differentiated from a trespass to land. A nuisance is an interference with the use and enjoyment
of the land and does not require interference with the possession
 A public nuisance exists when an act or condition is subversive of public order or
constitutes an obstruction of public rights. In other words, a public nuisance
involves an unreasonable interference with a right common to the general public.
 A private nuisance is a civil wrong that affects a single individual or a definite
number of persons in the enjoyment of some private right which is not common to
the public. It is a substantial and unreasonable interference with the private use
and enjoyment of one’s rights of ownership