Hans Raj Aggarwal v Munshiram & Company Limited

The only evidence supporting the counterclaim was the testimony of Krishan Kumar Aggarwal (DW1), the respondent's Managing Director, who itemised claims for rates, annual rent to the Commissioner of Lands, payments made for his son, overseas telephone calls, insurance and repairs. The Court of Appeal added those items itself and arrived at Shs.63,755.15, far below both the pleaded figure and the Shs.124,842.95 found proved by the High Court. The respondent's account was a disjointed story, so the judge's figure had no evidentiary foundation.

As a first appeal, the Court of Appeal was entitled to re-evaluate the evidence adduced in the Superior Court and draw its own conclusions rather than defer to the trial judge's findings. Doing so, it found no basis for the finding that the counterclaim was proved to Shs.124,842.95. The ground that the decision was against the weight of evidence therefore succeeded, and the judgment founded on that erroneous finding fell with it.

DW1 testified that the appellant had collected the rent for 1979, 1980 and 1981 and identified the claim as being for that rent. The Court of Appeal treated this evidence as an admission of the claim as per the plaint. An admitted claim requires no further proof, so judgment was entered for the appellant as prayed for in the plaint, with costs of the appeal and of the Superior Court.

The High Court had set off the appellant's claim of Shs.69,000 against the counterclaim of Shs.124,842.95, giving the respondent a balance with costs. Once the counterclaim failed for want of proof, the set-off could not stand: there was no proved cross-demand against which to set off the plaintiff's admitted claim. The Court of Appeal therefore set the judgment aside in its entirety and substituted judgment for the appellant as prayed in the plaint rather than varying the quantum.