Co-operative Bank of Kenya & Rentco East Africa Limited v Butaki Rollia Ndiema
The bottom line
#Kenya's Court of Appeal gave a bank and a leasing company a second chance to defend a road accident claim, ruling that even one genuine triable issue outweighs a default judgment.
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 erred in upholding the lower court's ruling which dismissed the appellants' application for setting aside the ex parte judgment entered in default of appearance and defence
Key legal issues
#Whether the draft defence disclosed bona fide triable issues
The Court found the draft defence raised multiple triable issues: denial of ownership of the vehicle, denial of negligence with contributory negligence particulars, denial of injuries and strict proof, and dispute of res ipsa loquitur, vicarious liability and volenti non fit injuria.
Ownership is a fundamental ingredient of vicarious liability and requires proof; negligence and causation and quantum require evidence; the strength or weakness of defences is not determined at an interlocutory stage. The courts below erred by evaluating the plausibility of the defence instead of asking whether it raised arguable issues fit for trial.
Whether the trial court and High Court misdirected themselves in evaluating the merits of the defence
Yes. The trial court embarked on determination of factual disputes without hearing evidence, and the High Court affirmed that approach instead of asking whether the draft defence disclosed arguable issues fit for trial.
The trial court went beyond determining whether triable issues existed and instead evaluated the plausibility of the defence, describing allegations as bewildering and interesting. This amounted to determining factual disputes without evidence from both parties, an error the High Court wrongly upheld.
Whether the appellants' delay in entering appearance and filing a defence justified refusal to set aside the default judgment
Although the delay was prolonged and the explanation less than satisfactory, the courts below were still required to consider whether the proposed defence disclosed a bona fide triable issue; prejudice could be remedied through costs.
Finality of litigation is important but should not override the right to a fair hearing where prejudice to the opposing party can be adequately remedied through costs. The appellants' offer of Kshs 15,000 thrown-away costs per case was found reasonable.
Legal principles established
#- On a second appeal, the Court of Appeal is confined to matters of law and cannot interfere with concurrent findings of fact by the two courts below.
- Where a proposed defence discloses even one bona fide triable issue, a court should ordinarily allow the matter to proceed to trial on appropriate terms rather than maintain a default judgment.
- A proposed defence need not be guaranteed to succeed; it is sufficient that it raises one bona fide issue deserving judicial investigation.
- The discretion to set aside an ex parte judgment exists to relieve against accident, inadvertence or excusable mistake, but not to assist a litigant who deliberately obstructs or delays the course of justice.
- An appellate court will interfere with the exercise of discretion to set aside an ex parte judgment where it was exercised on wrong principles, relevant matters ignored, irrelevant considerations taken into account, or where the decision is plainly wrong.
Court orders
#- 1.The judgment of the High Court dated 8th July 2021 is set aside
- 2.The ruling of the trial Magistrate's Court dated 10th July 2020 is set aside
- 3.The ex parte judgment entered on 13th May 2020 is set aside
- 4.The appellants are granted leave to file their statement of defence before the Magistrate's court within thirty (30) days of the judgment, failing which the ex parte judgment shall stand revived without further reference to the Court
- 5.The appeal is allowed with half costs to the respondent for each of the two appeals
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
Wrote the judgment
Wrote the judgment
- On appeal from
- High Court at Marsabit
- Marsabit HCCA No. 1 of 2020
- Jurisdiction invoked
- Section 3 of the Appellate Jurisdiction Act and Section 72(1) of the Civil Procedure Act (second appeal confined to matters of law)
Relief refused
#Full costs of both appeals
The Court awarded only half costs to the respondent despite allowing the appeal
Costs
The Appeal is allowed with half costs to the respondent for each of the two appeals.
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.
Accordingly, we find merit in the Appeal. Consequently, the judgment of the High Court dated 8 th July 2021, , the ruling of the trial Magistrate's Court dated 10 th July 2020 and the exparte judgment entered on 13 th May 2020 are hereby set aside.
The appellants are granted leave to file their statement of defence before the Magistrate’s court within thirty (30) days of this judgment, failing which the exparte judgment shall stand revived without further reference to this Court.
The upshot is that the Appeal is allowed with half costs to the respondent for each of the two appeals.
It is sufficient if it raises even one bona fide issue deserving judicial investigation.
Finality of litigation remains an important objective, but it should not override the fundamental right to a fair hearing where prejudice to the opposing party can adequately be remedied through costs.
Issues in the judgment
#Conflicting dates for the trial court's dismissal ruling
Pagination inconsistent with stated page count
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Co-operative Bank of Kenya & Rentco East Africa Limited v Butaki Rollia Ndiema", Case Analysis (2026). Civil Appeal No. E022 of 2026 (formerly Nyeri No. E115 of 2021). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1929/eng@2026-09-25
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.