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Court of AppealPartially AllowedCivil Appeal No. 59 of 2014· [2017] KECA 621 (KLR)

Hon. Alfred M. Nderitu v Mwea Rice Growers Multi Purpose Co-operative Society Limited

Court of Appeal
31 March 2017
5,500 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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The Court of Appeal reduced a Kshs.10.9 million judgment against Nderitu to Kshs.893,410.50 after finding the trial court ignored acknowledged payments he made.

What this practically means

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Executive summary

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This was a first appeal against the High Court's judgment of 21st September 2012 (Kimaru, J) in consolidated suits between Hon. Alfred M. Nderitu and Mwea Rice Growers Multi Purpose Co-operative Society Limited, concerning mutual claims arising from delivery and marketing of paddy and pishori rice through Kenya Millers Ltd between 1999 and 2000. The High Court had computed that the appellant received Kshs.38,169,369/= on the respondent's behalf and, after accounting for direct and third-party payments, entered judgment for the respondent for Kshs.10,881,157/= with interest. The appellant proffered 27 grounds condensed into issues on the weight and price of rice delivered, the white pishori rice claim (alleged to be res judicata), omitted direct and indirect payments, and interest. The Court of Appeal, in a single judgment of the court, reappraised the evidence under its first-appeal mandate. It upheld the High Court's findings on the weight and price of paddy rice, finding the documentary evidence illegible and the burden of proof unmet by the appellant. It rejected the res judicata objection to the white pishori rice claim, invoking substantive justice under Article 159(2)(d), since the claim was pleaded and the appellant admitted receiving the payments. However, it found that the learned Judge omitted four acknowledged direct payments totalling Kshs.10,223,367.50/= and two indirect payments totalling Kshs.1,551,200/=. Deducting the total of Kshs.11,774,567.50/= from the award below left a net balance of Kshs.893,410.50/= owing to the appellant. The appeal partly succeeded: the High Court judgment was set aside and judgment entered for the appellant for Kshs.893,410.50/= with interest at court rates from the date of filing suit until payment in full.

Key legal issues

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01

Duty of a first appellate court

Holding

The Court must reappraise the entire evidence and make its own findings of fact, allowing for the fact that it did not see the witnesses testify.

Reasoning

Relying on Rule 29(1) of the Court of Appeal Rules and Selle v Associated Motor Boat Company, the Court affirmed its retrial-type mandate on a first appeal, while emphasising deference to the trial judge's advantage in observing demeanour and the absence of a basis to disturb findings supported by the record.

p. 6
02

Res judicata and pleadings in relation to the white pishori rice claim

Holding

The white pishori rice claim was not res judicata because it was pleaded in the plaint, there was no final determination excluding it, and the appellant admitted receiving payment for it; substantive justice required its consideration.

Reasoning

Although the application to amend the plaint was dismissed, the pishori rice claim remained in paragraph 7 of the plaint and no ruling struck it out. The Court invoked Article 159(2)(d) and Sections 3A and 3B of the Appellate Jurisdiction Act, weighing prejudice: excluding the claim would unjustly enrich the appellant, who admitted receipt of the payments.

p. 7
03

Omitted direct and indirect payments

Holding

The learned Judge left out four acknowledged direct payments totalling Kshs.10,223,367.50/= and two indirect payments totalling Kshs.1,551,200/=; deducting these from the Kshs.10,881,157/= awarded below left the respondent owing the appellant Kshs.893,410.50/=.

Reasoning

The respondent acknowledged the four banker's cheques and its witness confirmed receipt on cross-examination, yet the judgment omitted them. Similarly, the two indirect payments were acknowledged in the respondent's submissions. Unacknowledged claims lacked evidential support. The arithmetic produced a net balance in the appellant's favour.

p. 8
04

Interest on the judgment sum

Holding

Although award of interest is a judicial discretion, the appellant himself had prayed for interest at court rates, so no basis was shown to disturb the award; interest was granted on the new judgment sum at court rates.

Reasoning

The Court accepted that interest is discretionary under Section 27 of the Civil Procedure Act (Cap 21) but noted the inconsistency in the appellant's position, having himself prayed for interest at court rates. It substituted its own award of interest at court rates from the date of filing suit.

p. 8

Legal principles established

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  • On a first appeal, the Court of Appeal reappraises the evidence and draws its own inferences of fact, while making due allowance for not having seen or heard the witnesses.
  • Parties are bound by their pleadings; evidence at variance with the pleadings goes to no issue and must be disregarded, subject to the overriding objective of substantive justice under Article 159(2)(d) and Sections 3A and 3B of the Appellate Jurisdiction Act.
  • The burden of proof lies on the party who alleges; a party seeking to prove a fact must produce legible, probative evidence such as independent records.

Court orders

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  1. 1.The judgment of the High Court is set aside
  2. 2.Judgment is entered for the appellant in the sum of Kshs.893,410.50/=
  3. 3.The said sum shall attract interest at court rates from the date of filing suit until payment in full
On appeal from
High Court of Kenya at Nairobi
HCCC No. 302 of 2003
Jurisdiction invoked
First appeal under the Court of Appeal Rules (Rule 29(1)), the Appellate Jurisdiction Act (Sections 3A and 3B) and Article 159(2)(d) of the Constitution

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Hon. Alfred M. Nderitu v Mwea Rice Growers Multi Purpose Co-operative Society Limited", Case Analysis (2017). Civil Appeal No. 59 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2017/621/eng@2017-03-31

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