Kenya Ports Authority v African Line Transport Co. Ltd [2014] KECA 688 (KLR)
The bottom line
#The Court of Appeal threw out a Kshs.100 million award against Kenya Ports Authority because the transporter never proved the missing goods reached the port.
What this practically means
#Executive summary
#Key legal issues
#Whether the trial judge identified and pronounced judgment on the issues arising from the pleadings
The trial judge missed the critical issue of whether the goods were shipped and discharged into the appellant's custody, and started from the wrong premise that the consignment had arrived and been discharged to the appellant; this was a misdirection.
Pleadings raised a disputed issue whether the goods in paragraph 3 and 5 of the plaint were shipped and discharged to the appellant. The Bill of Lading relied on in the plaint did not list the missing items, which appeared only in a document attached to another Bill of Lading with no proven nexus. A Bill of Lading is not conclusive proof of shipment and may be controverted. Failure to determine this foundational issue vitiated the judgment.
Allocation of the burden of proof regarding importation, discharge and release of the consignment
The respondent, as the party asserting that the goods were imported and discharged to the appellant, bore the legal burden of proving that fact first; the trial judge prematurely shifted the evidential burden to the appellant to prove release of the whole consignment.
Section 107 of the Evidence Act places the burden on whoever asserts facts. Without proof that the missing goods were shipped and discharged to the appellant, the respondent's claim could not stand. The gate pass indicated the consignment as complete with no balance endorsed, and the respondent's witnesses were clearing agents who did not participate in the discharge, leaving the possibility that the trailers were never discharged from the ship.
Whether the claim for loss of use was properly pleaded and proved, and whether the award of Kshs.100 million was proper
The trial judge wrongly treated loss of use as general damages when it was pleaded as special damages; the award could not exceed the pleaded Kshs.79 million, was not strictly proved (no audited accounts), and failed to account for mitigation.
Damages for loss of use must be pleaded and strictly proved as special damages. The only evidence was the accountant's estimate without statements of account. The respondent sat back counting losses on trailers valued at Kshs.449,750 instead of importing alternatives, breaching the duty to mitigate; at most loss of use should have been limited to 12 months. The award of Kshs.100 million was preposterous and the judgment on damages could not stand.
Whether the suit was statute barred and whether the extension of time could be challenged
The ex parte order granting leave to file suit out of time was challengeable within the suit, and the trial judge erred in failing to re-examine the limitation issue and the validity of the extension.
Following Divecon Limited v Shirinkhanu Sadrudin Samnani, the proper forum to challenge an ex parte extension order is within the suit once filed. The appellant raised limitation in its defence, so the trial judge was duty-bound to consider the validity of the extension rather than dismissing the point on the basis that leave had been obtained.
Whether the High Court had jurisdiction in light of section 62 of the Kenya Ports Authority Act
Section 62 of the Kenya Ports Authority Act ousted the court's jurisdiction by providing for compensation by agreement or compulsory statutory arbitration, and the parties could not confer jurisdiction on the High Court by their pleadings or participation.
The appellant was alleged to have been exercising powers under section 12(1) of the Act, so section 62 applied. Adopting Kenya Ports Authority v Kustron (Kenya) Limited, compulsory statutory arbitration under section 62 touches on the jurisdiction of the superior court; parties cannot contract out of the statute, cannot waive the bar by participating in the suit, and an illegality once committed remains an illegality.
Legal principles established
#- A first appellate court must reconsider and evaluate the evidence and reach its own conclusion, while giving allowance for the trial judge's advantage of seeing and hearing the witnesses, and will not interfere with findings of fact based on no evidence, misapprehension of the evidence, or wrong principles.
- Issues for determination in a suit flow from the pleadings, and a trial court may only pronounce judgment on issues arising from the pleadings or as framed by the parties.
- A party asserting facts on which its claim depends bears the legal burden of proving those facts before the evidential burden can shift to the other party.
- Where a statute provides for compulsory statutory arbitration (section 62, Kenya Ports Authority Act), the jurisdiction of the superior court is ousted and parties cannot confer jurisdiction by their pleadings or conduct; there can be no waiver of the statutory bar.
- The proper forum to challenge an ex parte order granting leave to file suit out of time is to raise the issue within the suit after it has been filed, and the court must then examine the validity of the extension.
- Damages for loss of use of a vehicle must be claimed and strictly proved as special damages, not general damages, and an appellate court will not disturb an award unless it proceeds on wrong principles or misapprehends the evidence so as to be an erroneous estimate.
Court orders
#- 1.Appeal allowed
- 2.Judgment of the trial court set aside
- 3.Respondent's suit dismissed with costs
- 4.Appellant to have costs of this appeal
- On appeal from
- High Court of Kenya at Mombasa
- Mombasa Commercial Case No. 128 of 2006
- Jurisdiction invoked
- First appeal to the Court of Appeal under the appellate jurisdiction of the Court (Constitution/Act of the Court of Appeal); the judgment does not cite a specific provision
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.
- Kenya Ports Authority v Modern Holdings [E.A] Limited [2017] KECA 293 (KLR)[2017] KECA 293 (KLR)29 Sept 2017
Cite this brief
#Cite this brief
Caselaw, "Kenya Ports Authority v African Line Transport Co. Ltd [2014] KECA 688 (KLR)", Case Analysis (2014). Civil Appeal No. 149 of 2012. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2014/688/eng@2014-03-27
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.