Matende Juma was employed by Marion Kaveza to sell her piece of land situated in Nazarede Town at 10% commission. Norah Muhonja, a prospective buyer promised to pay Matende Juma Sh.50,000 in addition to the purchase price of Sh.500,000 if he agreed to reserve the land for her as she raised the purchase price. Matende Juma reserved the land for Norah Muhonja ignoring Timothy Kyalo, another buyer who offered to buy the same land for Sh.600,000 all of which he wanted paid directly to Marion Kaveza, the land owner. After three months, Norah Muhonja paid Sh.500,000 for the land and gave Matende Juma the Sh.50,000 she had promised. Marion Kaveza eventually transferred the land to Norah Muhonja but later discovered that Matende Juma had received Sh.50.000 from Norah Muhonja and that Timothy Kyalo had offered to pay a higher price for the land. Analyse the legal principles applicable in the above case and advise Marion Kaveza who intends to sue Matende Juma.

Legal principles applicable in the given case:

  • An agent must always perform his duties in good faith while working for the principal.
  • He must work in the best interest of the principal.
  • He must execute his duties with reasonable skill for example looking for the best
  • Matende Juma made a secret profit of Sh.50, 000 from Norah Muhonja hence did not act in good faith.
  • He also did not act for the best interests of the principal as he ignored Timothy Kvalo
    who offered a higher price for the land.
  • Marion Kaveza can sue Matende Juma to recover the secret profit.
  • Marion Kaveza can also refuse to pay Matende Juma his remuneration.
  • Marion Kaveza can also terminate the agency relationship.
  • She can therefore successfully sue.
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