Base Titanium Limited v County Government of Mombasa & another [2018] KECA 375 (KLR)
The bottom line
#Kenya's Court of Appeal confirmed that county governments can lawfully charge trucks a cess for road services, and challenges to such levies need hard evidence, not general complaints.
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 finding that the cess was a road service charge was based on unpleaded issues, thereby infringing the appellant's right to a fair hearing
- 2.Whether the County Government had the power under Article 209(3) and (4) of the Constitution to levy the cess imposed on vehicles transporting goods into Mombasa County
- 3.Whether the cess was a charge on the minerals themselves, and therefore unconstitutional under Article 62 of the Constitution
- 4.Whether the levy violated Article 209(5) of the Constitution by prejudicing national economic policies or restricting movement of goods across county boundaries
Key legal issues
#Whether the cess was a road service charge based on an unpleaded issue
The reply to the petition alluded to a uniform charge on all commercial trucks, and the issue was raised in submissions, so the trial court did not err in determining it.
The court perused the pleadings and found paragraph 4 of the respondent's reply described a uniform charge on all commercial trucks over seven tonnes regardless of goods. The road service character of the cess was also canvassed in the parties' submissions before the trial court. The doctrine permitting determination of unpleaded issues that arise during trial, where both sides had opportunity to address them, therefore applied.
Whether the county had power to levy the cess under Article 209(4)
The cess was a valid charge for road transport services provided by the county under Article 209(4), levied pursuant to item 90 of the Mombasa County Finance Act, 2014.
Article 209(4) empowers county governments to impose charges for services they provide. Road transport is a county function under the Fourth Schedule. The cess was imposed on all goods-carrying vehicles entering and offloading in Mombasa County, presupposing road services rendered by the county. It was therefore a legitimate charge within the county's revenue-raising powers.
Whether the cess was a charge on minerals unconstitutional under Article 62
The cess was on the vehicles, not on the minerals; had it been a charge on minerals it would have been unconstitutional, as minerals are vested in the national government under Article 62.
The court distinguished between a charge on the mineral product and a charge for the road service of transporting goods. Since the levy applied to all goods-carrying vehicles regardless of cargo, it was not a tax on minerals, which fall within the exclusive domain of the national government. The trial judge's reasoning on this point was endorsed.
Whether the cess violated Article 209(5)
The appellant failed to demonstrate, with cogent evidence, that the cess prejudiced national economic policies or restricted movement of goods across county boundaries.
A party alleging constitutional violation must cite the provisions violated and demonstrate the manner of violation. Reliance on letters from the Transition Authority and the National Treasury, and on payments made, was insufficient. No evidence was adduced to show the cess hindered movement of goods or was prejudicial to national economic policies as contemplated by Article 209(5).
Legal principles established
#- A county government may, under Article 209(4) of the Constitution, impose charges for services it provides, including road transport services, and such a cess on goods-carrying vehicles is a charge on the vehicle and service, not on the goods or minerals carried.
- A party alleging violation of the Constitution must cite the particular provisions violated and demonstrate the manner of the violation; generalities are insufficient.
- Parties are bound by their pleadings, but a court may determine an unpleaded issue where it arose during trial, a party addressed and led evidence on it, and the other side had an opportunity to respond.
Court orders
#- 1.The appeal is dismissed
- 2.No orders as to costs, the matter being a public interest matter
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court of Kenya at Mombasa
- Petition No. 9 of 2015
- Jurisdiction invoked
- First appeal to the Court of Appeal under the Appellate Jurisdiction Act (appeal from a constitutional petition decided by the High Court)
Relief refused
#Declaration that the cess of Kshs.3,000 per truck was unconstitutional, null and void
The appellant failed to demonstrate that the cess violated Article 209(5) of the Constitution; the cess was a lawful charge for road transport services under Article 209(4)
Mandatory injunction compelling refund of Kshs.1,542,000 paid as cess
The petition having failed, no refund was ordered
Costs
No orders as to costs; the matter being a public interest matter, each party to bear its own 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.
we find this appeal lacking in merit and is hereby dismissed. The matter being a public interest matter we make no orders as to costs.
The cess charges are on the vehicles transporting goods of any kind entering and off-loading in Mombasa, and are not a tax or charge on the product transported.
It is not enough to mention perceived violations of the Constitution in generalities as the appellant has done in his petition.
An issue is deemed to have been left for the court’s decision when a party addressed the court and led evidence on it and the other side had an opportunity to address it though not pleaded
Issues in the judgment
#The judgment states the petition was filed based on grounds, but paragraph [6] says 'the appellant filed a reply to the petition' when describing the 1st respondent's response, which appears to be an error - it was the 1st respondent who filed the reply to the petition.
The judgment refers to the High Court judgment as both dated 20th February, 2015 in the header and dated 21st February, 2017 in paragraph [7], conflicting dates.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Base Titanium Limited v County Government of Mombasa & another [2018] KECA 375 (KLR)", Case Analysis (2018). Civil Appeal No. 69 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2018/375/eng@2018-07-05
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.