National Bank of Kenya Ltd v Wilson Ndolo Ayah
The bottom line
#Kenya's Court of Appeal confirmed that loan security documents drawn by an advocate without a valid practising certificate are void, costing the bank its Kshs 57 million claim.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the trial court's reference to the amended plaint rather than the re-amended plaint caused procedural irregularity prejudicing the appellant
- 2.Whether the trial court erred in failing to deal with the appellant's re-amended defence and counterclaim
- 3.Whether documents (a charge and deed of guarantee) drawn by an advocate without a current practising certificate are invalid and unenforceable under section 34 of the Advocates Act
Key legal issues
#Effect of an advocate's lack of a current practising certificate on documents drawn by that advocate
Such documents are invalid ab initio; the invalidating rule serves public policy and the public interest
Section 34 of the Advocates Act makes it an offence for an unqualified advocate to draw documents for a fee, but neither it nor any other written law addresses validity. The court reasoned that public policy requires courts to enforce the law and not perpetuate illegalities; invalidation deters repetition of the illegality, and the innocent party retains remedies against the guilty advocate, including summary recovery of fees as a civil debt.
Doctrine of precedent and conflicting High Court authority
High Court decisions adopting the minority view in Huq v Islamic University depart from binding Court of Appeal precedent (Obura v Koome)
The court noted High Court decisions split on the issue, some following Obura v Koome and some adopting the Ugandan dissent. It held that a High Court judge who disagrees with a Court of Appeal decision may express views but must ultimately follow the binding decision; the High Court has no discretion in the matter.
Procedural irregularity in the trial judgment's reference to the amended plaint
No prejudice was caused by the reference to the amended plaint instead of the re-amended plaint
An amended pleading replaces the existing one and speaks from the commencement of the action. The re-amended plaint merely corrected the statutory provision cited (Law Society Act instead of Advocates Act), so the trial court's reference caused no prejudice to the appellant.
Legal principles established
#- Documents drawn or prepared by an advocate who does not hold a current practising certificate are invalid and of no legal effect
- The High Court is bound by decisions of the Court of Appeal and has no discretion to depart from them
Court orders
#- 1.Appeal dismissed
- 2.No order as to costs
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court of Kenya at Nairobi (Milimani)
- HCCC No 1723 of 1997
- Jurisdiction invoked
- First appeal to the Court of Appeal under the applicable appellate provisions (not expressly cited in the judgment)
Relief refused
#Appellant's appeal against the declaration that the charge and deed of guarantee were null and void ab initio
Documents drawn by an advocate without a current practising certificate are invalid; public policy requires courts not to perpetuate illegalities
Appellant's counterclaim for Kshs. 57,308,137.50
Once the charge and guarantee were held unenforceable, there was no necessity to deal with the counterclaim
Costs
No order on costs - the court was disinclined to make any order on costs
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
For that reason alone the charge and instrument of guarantee in this matter are invalid, and we so hold.
It is public policy that courts should not aid in the perpetuation of illegalities.
The latter decisions appear to us to be departing from the doctrine of precedent, as the High Court in this country is bound by decisions of the Court of Appeal.
That being our view of the mater we hold that this appeal lacks merit and it is accordingly dismissed. Considering the facts and circumstances of this case, we are disinclined to make any order on costs.
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (1)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Maana v Mbomere & 5 others[2022] KEELC 12792 (KLR)28 Sept 2022
Cite this brief
#Cite this brief
Caselaw, "National Bank of Kenya Ltd v Wilson Ndolo Ayah", Case Analysis (2009). Civil Appeal 119 of 2002. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2009/467/eng@2009-12-04
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.