Lucas Ahula Ocheyo & Another v Al-Hyder Trading Company Limited & Another
The bottom line
#If you breach a contract, even if you pay later, the seller can legally demand penalties and withhold property unless they clearly waived their rights.
What this practically means
#Executive summary
#Key legal issues
#Effect of a defendant's failure to adduce evidence
A defence unsupported by evidence remains mere allegations and the plaintiff's evidence is uncontroverted; however, this did not assist the appellants because their own evidence showed breach
The court adopted the trite position from Motex Knitwear, Trust Bank and Janet Kaphiphe Ouma that unchallenged pleadings remain unsubstantiated. Yet even taking the appellants' own evidence, payment was completed in April 2015 against an April 2012 contractual deadline, establishing breach.
Waiver and estoppel from accepting late payment
The respondents' acceptance of late instalments did not waive their rights; the appellants pointed to no action demonstrative of waiver
Applying Banning v Wright and 748 Air Services Ltd v Munyi, waiver requires conduct evincing abandonment of a right. The appellants, who themselves breached the contract, could not show any step by the respondents waiving the right to recover the property in default of payment.
Whether the Kshs. 130,000.00 demand was an unlawful penalty
Clause 28 of the contract provided for a 30% penalty on default; the Kshs. 130,000.00 was that contractual penalty and the appellants proved no illegality
The court agreed with the trial court that the sum corresponded to the 30% default penalty written into the very agreement the appellants relied on, and they adduced no evidence that it was an illegal levy.
Whether the respondents were justified in withholding the logbook
Yes - there was a clear breach of contract by the appellants, and repossession under clause 11 was not the absolute or only remedy, clause 31 requiring the purchaser to clear the whole remaining balance upon repossession
Reading clauses 11, 25 and 31 together, repossession was not the exclusive remedy and the 30% penalty applied on default; hence waiver was not an option and transfer of the logbook before payment of the penalty was properly refused.
Legal principles established
#- Where a party files a defence but fails to adduce evidence at the hearing, its pleadings remain mere statements of fact and the plaintiff's evidence stands uncontroverted
- Waiver may arise from conduct evidencing an intention to abandon a right, but must be demonstrated by some action or step by the party said to have waived it
Court orders
#- 1.The appeal is dismissed
- 2.Costs implicitly follow the dismissal (no separate costs order stated)
- On appeal from
- Senior Principal Magistrate's Court, Kakamega
- Kakamega CMCCC No. 203 of 2015
- Jurisdiction invoked
- First appeal from the magistrate's court under the Civil Procedure Act (appeal as of right from the subordinate court's judgment and decree)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Lucas Ahula Ocheyo & Another v Al-Hyder Trading Company Limited & Another", Case Analysis (2020). Civil Appeal No. 174 of 2018. Source:
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.