Onesmus Githinji & Company Advocates v Fidelity Bank Limited [2018] KECA 635 (KLR)
The bottom line
#Kenya's Court of Appeal confirmed that a lawyer's professional undertaking is binding and must be honoured, even if the lawyer claims the debt was already settled.
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 High Court was right in determining that the appellant had breached its professional undertaking and in ordering its enforcement
- 2.Whether the respondent bank had locus standi to institute proceedings for enforcement of the professional undertaking
- 3.Whether payments made into the overdraft account between 30th April 2010 and the furnishing of the undertaking on 28th June 2010 discharged the undertaking
Key legal issues
#Whether the appellant breached its professional undertaking to pay the bank Kshs. 3,036,380.85 within 7 days of registration of the discharge
The appellant was in breach; payments of Kshs. 2,450,000 made into the borrower's overdraft account before the undertaking was given were payments to the borrower, not to the bank, and could not discharge the subsequent undertaking.
The undertaking was given on 28th June 2010 to pay the sum outstanding as at 30th April 2010 within 7 days of registration of the discharge, time being of the essence. It would have been absurd to give such an undertaking had the appellant already considered the debt discharged. The appellant did not qualify its undertaking to state that payment had already been made. The cheques were issued to the borrower and deposited into the borrower's account; the bank received nothing. The undertaking therefore stood and enforcement was properly ordered.
Whether the bank had locus standi to enforce the undertaking given to the bank's advocates
The bank, as the client and disclosed principal on whose behalf the undertaking was given, had locus standi; the appellant's contrary argument misread Waruhiu K'Owade & Nganga Advocates and was also barred by its earlier concession.
The appellant conceded before the High Court that the bank had locus standi and abandoned its preliminary objection, and did not raise the issue in its memorandum of appeal. In any event, Karsam Lalji Patel remains good law: an advocate giving an undertaking does so as agent of a disclosed principal, so the client may sue. Waruhiu K'Owade concerned a lien and the separateness of undertakings from contract; it did not alter the position on locus standi.
Legal principles established
#- A suit for enforcement of a professional undertaking given by an advocate may be maintained at the instance of the client (the disclosed principal) on whose behalf the undertaking was given, not only by the advocates to whom it was given.
- A professional undertaking given by an advocate is separate and distinct from the underlying contract, and collateral contractual matters cannot dilute the advocate's obligation to honour it.
- Payments made into an overdraft account before the date of a professional undertaking cannot be relied upon to discharge a subsequent undertaking to pay the balance outstanding.
Court orders
#- 1.The appeal is dismissed with costs to the respondent
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court
- H.C.C.C. No. 209 of 2012
- Jurisdiction invoked
- First appeal to the Court of Appeal against the judgment of the High Court (not expressly grounded on a cited provision in the judgment)
Relief refused
#Setting aside the order enforcing the professional undertaking
The court found the appellant had not discharged the undertaking and that payments made into the overdraft account were payments to the borrower, not to the bank
Re-opening the locus standi objection conceded before the High Court
The appellant had conceded the issue in the lower court and the argument that Karsam Lalji Patel had been overruled was based on a misapprehension of Waruhiu K'Owade & Nganga Advocates
Costs
The appeal was dismissed with costs to the respondent (the bank).
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.
The result of the foregoing is that the appeal is devoid of any merit. It is accordingly dismissed with costs to the respondent.
In our judgment therefore, the learned Judge correctly ordered the appellant to honour its professional undertaking.
The decision of this Court in Karsam Lalji Patel stands for the proposition that a suit for enforcement of a professional undertaking given by an advocate can be maintained at the instance of the client on whose behalf it was given.
it is inconceivable that payments made prior to the furnishing of the undertaking would go towards discharging a subsequent undertaking.
a professional undertaking given by advocates is separate and distinct from the underlying contract
Issues in the judgment
#The sum quoted from the High Court judgment appears as Shs.3,030,638.85, which differs from the figure of Kshs. 3,036,380.85 used elsewhere in the judgment, suggesting a typographical transposition.
Counsel for the respondent is described as 'learned counsel for the appellant' in the paragraph recording his submissions, which appears to be a typographical error.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Onesmus Githinji & Company Advocates v Fidelity Bank Limited [2018] KECA 635 (KLR)", Case Analysis (2018). Civil Appeal 253 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2018/635/eng@2018-04-20
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.