Lois Holding Ltd v Kimbui (Environment and Land Case E012 of 2025) [2026] KEELC 3695 (KLR)
The bottom line
#A Kenyan court ruled that a plaintiff who withdraws a suit after settling a family dispute may not have to pay the defendant's legal costs.
What this practically means
#Executive summary
#Key legal issues
#Whether withdrawal of a suit under Order 25 rule (1) automatically triggers an award of costs to the defendant
No. The award of costs remains discretionary under section 27 of the Civil Procedure Act, and the court may depart from the general rule where the withdrawal follows a genuine settlement
Relying on Rai v Rai, the court held that section 27(1) confers an open-ended mandate to award or withhold costs judiciously based on good reasons. Here the suit was withdrawn because the underlying family and succession dispute had been settled through mediation, the defendant filed his defence aware of the mediation process, and no exceptional expenses were shown. The withdrawal was neither vexatious nor abusive, so no costs order was warranted against the withdrawing plaintiff.
Whether the circumstances of the withdrawal (family dispute resolved by succession settlement) justify no order as to costs
Yes. The parties were family members or family-linked entities; the dispute was resolved through a mediation settlement in a concurrent succession cause; and neither party was prejudiced by the withdrawal
The court noted the family relationship pleaded in the plaint and admitted in the defence, the existence of Nairobi High Court P&A Succession Cause No. 16 of 2018, and the mediation process confirmed by both counsel. Both parties were beneficiaries of the settlement agreement. Since the withdrawal conserved judicial time and reflected responsible conduct rather than bad faith, the just outcome was for each party to bear their own costs.
Legal principles established
#- Costs follow the event under section 27 of the Civil Procedure Act, but the court has a discretion to depart from that rule for good reason, exercised in accordance with reason and justice
- Costs are compensatory, not punitive, and conduct of the parties before, during and after litigation may justify departing from the general rule
Court orders
#- 1.The suit, which was withdrawn on 21/4/2026 under Order 25 rule (1) of the Civil Procedure Rules, stands as withdrawn
- 2.Each party bears their own costs in this matter
- Jurisdiction invoked
- Section 27 of the Civil Procedure Act and Order 25 of the Civil Procedure Rules (discretion on costs following withdrawal of suit)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Lois Holding Ltd v Kimbui (Environment and Land Case E012 of 2025) [2026] KEELC 3695 (KLR)", Case Analysis (2026). Not stated in judgment (referenced against Kitale ELC No. E010 of 2025 as a related file). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/3695/eng@2026-06-17
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.