Okumu Kubai & Co. Advocates
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Foreign Exchange Losses on Debt-to-Equity Conversions are Tax Deductible - Okumu Kubai & Co. Advocates
The Court of Appeal held that foreign exchange losses realized on the conversion of debt to equity are tax deductible under Section 4A of the Income Tax Act. The court found that the character of the loss follows the purpose of the loan, not the method of repayment. Since the loans were used for operational purposes, the losses were revenue in nature. The decision confirms that Section 4A overrides the general capital expenditure disallowance, and the Commissioner cannot restrict deductions beyond what the statute expressly provides.
Why court declined to stay the Judgement on unconstitutionality of the NSSF Act of 2013 - Okumu Kubai & Co. Advocates
The Court of Appeal declined to stay a ruling declaring the National Social Security Fund Act of 2013 unconstitutional, leaving monthly NSSF deductions at Sh200 under the old Act. The court found that the NSSF Board failed to provide evidence that the stay was necessary to prevent irreparable harm. The dispute, which involves a challenge to the 2013 Act's higher contribution rates and its passage without Senate involvement, remains pending on appeal. Until the main appeal is resolved, employers and employees continue contributing under the old Cap. 258 framework.
Your Pension Belongs to You: Supreme Court Settles the Debate on Pension Funds and Public Procurement - Okumu Kubai & Co. Advocates
The Supreme Court of Kenya, in Association of Retirement Benefits Schemes v Attorney General & 3 Others, declared Section 2(o) of the Public Procurement and Asset Disposal Act unconstitutional. The provision had classified pension funds for public entities as public entities, subjecting them to public procurement requirements. The Court held that pension contributions, once remitted to a scheme, become private trust property, not public funds. This decision frees pension schemes for public employees from government procurement procedures, reducing compliance costs and affirming trustee autonomy.
From Guarded Exception to Emerging Norm: Constructive Trust and the Gradual Erosion of Indefeasibility of title - Okumu Kubai & Co. Advocates
The Court of Appeal's 2026 decision in Erick Kipkurgat Kiprono v Patrick Kimutai Kiprono marks a shift toward a more flexible, inferential approach to establishing constructive trusts, potentially lowering the evidentiary threshold for defeating registered ownership under section 24 of the Land Registration Act. The case involved brothers who jointly purchased land but held title solely in one name; the court upheld the trial court's finding of a trust based on the sale agreement and agency relationship, despite the registered proprietor's claim of absolute ownership. This departure from earlier strict-proof standards in Mbothu v Waitimu risks blurring the line between legal ownership and equitable interests, raising concerns about the erosion of indefeasibility of title.
Road Traffic Accident claims not subject of Small Claims Court jurisdiction: Recent Jurisprudential Developments - Okumu Kubai & Co. Advocates
The High Court in Eldoret ruled that the Small Claims Court lacks jurisdiction to hear personal injury claims arising from road traffic accidents, excluding such claims from Section 12(1)(d) of the Small Claims Court Act. The Court also declared Rule 25(1) of the Small Claims Court Rules unconstitutional, prohibiting the use of civil jail for enforcing SCC judgments. The decision is based on the purposive interpretation that RTA claims require complex evidentiary analysis incompatible with the SCC's simplified procedures.
High Court Affirms the Centrality of i-Tax in Lodging Valid Tax Assessment Objections - Okumu Kubai & Co. Advocates
The High Court ruled that a tax assessment objection is only valid if submitted through the iTax portal, rejecting objections via email or other informal means. The court found that the taxpayer's initial email objection was invalid, so the 60-day period for the Commissioner to issue an objection decision began when the objection was properly filed on iTax. This decision emphasizes strict procedural compliance under the Tax Procedures Act and sets aside a Tax Appeals Tribunal ruling that had nullified the assessment.
Fraud Demands Proof, Not Assumption: Court of Appeal Protects Registered Titles - Okumu Kubai & Co. Advocates
The Court of Appeal upheld the validity of registered titles in a land dispute, ruling that allegations of fraud must be specifically pleaded and proven to a higher standard. The court found that the appellants failed to prove fraud and relied on the Land Registrar's report confirming the respondents' titles as genuine. The decision reaffirms the indefeasibility of registered title under the Land Registration Act.
Recalibrating Land Governance in Kenya: The Implications of the Land Laws (Amendment) Act, 2023 - Okumu Kubai & Co. Advocates
The Land Laws (Amendment) Act, 2023, assented to on 15th October 2025, overhauls Kenya's land governance by centralizing compulsory acquisition authority from the National Land Commission (NLC) to the Cabinet Secretary for Lands, removing time limits on NLC reviews of public land grants and historical injustice claims, permitting non-citizens to hold 99-year leasehold interests, introducing a land value index with ten-year rent reviews for public land leases, and requiring a land rent clearance certificate for registration of charges on leasehold property. These reforms aim to enhance transparency and address historical wrongs while raising concerns about reduced independent oversight, tenure security, and potential market disruptions.
Digital Lenders Standing at the Small Claims Court in Kenya - Okumu Kubai & Co. Advocates
On 10 February 2025, the Small Claims Court in Nairobi dismissed a suit by M-Collect Limited against Mbwana Kalua for failure to comply with section 33S of the Central Bank of Kenya Act, which requires digital lenders to be licensed. The court also declared M-Collect a vexatious litigant for filing multiple suits without prosecuting them. The ruling underscores that unlicensed digital lenders cannot recover debts through court proceedings, and it discourages the abuse of court process by lenders who file suits solely to intimidate debtors.
Claims for refund of rental deposit are subject of the Small Claims Court’s jurisdiction - Okumu Kubai & Co. Advocates
The High Court in Michelle Muhanda v. LP Holdings Limited ruled that claims for refund of rental deposits fall within the jurisdiction of the Small Claims Court under Section 12(1)(b) of the Small Claims Act, as they involve contracts for money held and received. The court distinguished such claims from rent and rental arrears, which are not within the SCC's jurisdiction. Claimants must waive recovery of sums exceeding Kshs. 1 million. This decision clarifies the scope of SCC jurisdiction in landlord-tenant disputes.
Compliance with the Data Protection Act by Digital Credit Providers - Okumu Kubai & Co. Advocates
The High Court upheld an award of Ksh.300,000 each to three individuals whose data privacy rights were violated by a digital credit provider that listed them as emergency contacts without their consent. The court found the lender violated sections 26 and 28 of the Data Protection Act by failing to inform and obtain consent from the data subjects directly. The ruling affirms that data controllers cannot delegate their obligations to obtain consent to borrowers or other parties. The decision serves as a deterrent against privacy violations and emphasizes the need for compliance with the Data Protection Act.