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Court of AppealPartially AllowedCivil Appeal No. 48 of 1994· [1996] KECA 148 (KLR)

Kenya Reinsurance Corporation v V.e. Muguku Muriu T/A M/s V.e. Muguku Muriu & Company

Court of Appeal
29 October 1996
2,163 words in judgment
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The bottom line

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Kenya's Court of Appeal ruled that an advocate who gives a professional undertaking to pay money must honour it fully, regardless of any disputes the client later raises.

What this practically means

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Executive summary

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The Court of Appeal allowed the Kenya Reinsurance Corporation's appeal against a High Court judgment that had declined to enforce in full an advocate's professional undertaking. The respondent advocate gave an unconditional undertaking to pay the redemption amounts due under a charge on L.R. No. Nairobi/Block 93/736 as set out in the corporation's letter of 26th June 1986, namely Shs.499,023.95 plus daily interest and other charges. He later sought to qualify the undertaking by relying on disputes between his client Matharu and the corporation, and sent a cheque for a lesser sum which the corporation's advocates rightly rejected. The court held that an advocate who gives a solemn professional undertaking is bound by it and cannot resile from or water it down on account of disputes between his client and the beneficiary; if the amount is disputed, the advocate should not give the undertaking or should return the documents at once. The trial judge erred in placing the advocate in his client's shoes and in treating the client's claims as defences to enforcement. The advocate's counter-claim, pleaded on behalf of non-parties, was dismissed: he had no locus standi, special damages must be strictly proved, and general damages cannot generally be claimed for breach of contract. The judgment and decree of the High Court (J.W. Mwera J, 16 July 1991) were set aside and substituted with judgment enforcing the undertaking, with interest, and costs to the appellant in both courts.

Key legal issues

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01

Enforceability and irrevocability of an advocate's professional undertaking

Holding

The undertaking given was unambiguous, unequivocal and binding; it could not be qualified by accounting disputes between the parties.

Reasoning

The respondent advocate gave an unconditional undertaking to pay the redemption amounts set out in the appellant's letter of 26th June 1986. He later attempted to introduce his client's disputes about the amount owed to water down the undertaking, including by sending a lesser cheque. The court held that an advocate who gives a solemn undertaking is bound by it and cannot resile; if the amount was disputed he should not have given the undertaking or should have returned the documents at once.

p. 2
02

Whether the advocate could raise his client's defences to enforcement of the undertaking

Holding

The learned judge erred in placing the advocate in the shoes of his client; the only question was whether an enforceable undertaking had been given.

Reasoning

The trial judge wrongly treated the client Matharu's claims against the corporation as defences available to the advocate in the enforcement claim. The court held that disputes between the client and the corporation, including claims about the date interest commenced and non-occupation of the property, were matters between those parties and did not vitiate or vary the advocate's undertaking. A careful advocate would obtain clear instructions before giving an undertaking, failing which he takes the consequences.

p. 3
03

Whether rejection of a cheque for a lesser amount stopped the accrual of interest

Holding

The payee was entitled to reject a cheque for less than the amount covered by the undertaking, and interest continued to accrue.

Reasoning

The respondent sent a cheque for Shs.426,839.75, less than the sum he had undertaken to pay. The corporation's advocates were entitled to reject it because acceptance would have risked an estoppel argument that the claim was settled. Interest was payable on the amount covered by the undertaking and there was no question of changing that date.

p. 3
04

Counter-claim pleaded by the advocate on behalf of non-parties

Holding

The counter-claim should have been disallowed; the advocate had no locus standi and general damages cannot generally be claimed for breach of contract.

Reasoning

The counter-claim was brought by the advocate in his own name on behalf of third parties who were not parties to the suit. The advocate lacked locus standi; one of the named third parties had nothing to do with the matter; special damages must be pleaded and strictly proved; and general damages cannot generally be claimed for breach of contract. The trial judge erred in even considering it.

p. 4

Legal principles established

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  • An advocate who gives a professional undertaking is bound by it and cannot resile from or qualify it on account of disputes between his client and the party to whom the undertaking is given.
  • Client defences and disputes do not vitiate or vary an advocate's unequivocal undertaking; if the amount is disputed the advocate should not give the undertaking, or should return the documents.
  • A party who enters appearance and files a defence and counter-claim cannot later object that the proceedings should have been commenced by a different procedure.

Court orders

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  1. 1.The judgment and decree of the superior court set aside and substituted with judgment for the appellant directing the respondent advocate to make good his professional undertaking
  2. 2.Payment of the principal sum of Shs.499,023.95 plus interest of Kshs.150/50 per day from 1/7/86 to 26/3/88, less sums paid, netting Shs.241,297.55, payable within thirty days and in default execution to issue
  3. 3.The sum of Shs.241,297.55 to carry interest at 13% per annum from 27th March 1988 until date of payment
  4. 4.The respondent advocate's counter-claim dismissed with costs
  5. 5.The respondent advocate to pay the appellant's costs in the superior court
  6. 6.The appellant to have the costs of this appeal
On appeal from
High Court of Kenya at Nairobi
H.C.C.C. No. 4060 of 1987
Jurisdiction invoked
First appeal to the Court of Appeal from the judgment and decree of the High Court (statutory appellate jurisdiction)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (1)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Kenya Reinsurance Corporation v V.e. Muguku Muriu T/A M/s V.e. Muguku Muriu & Company", Case Analysis (1996). Civil Appeal No. 48 of 1994. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/1996/148/eng@1996-10-29

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.