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Small ClaimsStruck OutStatement of Claim dated 05th September 2024· [2024] SCC 27 (KLR)

Faulu Microfinance Bank Limited v Simiyu (Commercial Case E142 of 2024) [2024] SCC 27 (KLR)

Adjudicator's Court (Small Claims), Kitale
30 September 2024
TOT.O. Omono
387 words in judgment
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The bottom line

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A Kenyan lender lost a Kshs. 445,499 loan claim because it never filed the loan statement account proving the borrower actually defaulted.

What this practically means

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Executive summary

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The Claimant filed a Statement of Claim dated 05th September 2024 seeking judgment of Kshs. 445,499.77 with interest and costs. It averred that in July 2021 it advanced the Respondent a loan facility of Kshs. 500,000 repayable in 60 months at monthly instalments of Kshs. 14,065.38 with interest at 20% per annum, that the Respondent defaulted, and that despite demand and notice of intention to sue the loan remained non-performing. The Respondent neither entered appearance nor filed a response despite due service, so the claim proceeded as undefended. The court framed a single issue: whether the Claimant proved its claim to the required standard. The advance was supported by the Personal Loan Application Form and Personal Loan Verification Form, both dated 16th July 2021, and the Claimant's Legal Officer, Frederick Nyabuti (CW1), gave oral evidence. However, the court noted that although CW1 referred to a Loan Statement Account in his testimony, that document was not among those filed. In its absence the court could not make a definitive finding that the Respondent defaulted in servicing the facility. In the disposition delivered at Kitale on 30th September 2024, T.O. Omono (Adjudicator) struck out the claim without an order of costs.

Key legal issues

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01

Whether the Claimant proved its claim to the required standard in an undefended claim

Holding

The claim was not proved because the Loan Statement Account relied upon in evidence was never filed, so default could not be established

Reasoning

The loan advance was corroborated by the Personal Loan Application Form and Verification Form dated 16th July 2021, and CW1 testified. However, although CW1 referred to a Loan Statement Account, that document was not among those filed. Without it, the court could not make a definitive finding of default, and the claim failed on proof despite being undefended.

p. 2

Legal principles established

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  • A claimant must produce the loan statement account to prove default in servicing a loan facility; without it default cannot be established

Court orders

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  1. 1.This Claim is struck out without an order of costs
Jurisdiction invoked
Original jurisdiction of the adjudicator over the money claim as pleaded in the Statement of Claim dated 05th September 2024

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Faulu Microfinance Bank Limited v Simiyu (Commercial Case E142 of 2024) [2024] SCC 27 (KLR)", Case Analysis (2024). Statement of Claim dated 05th September 2024. Source: https://new.kenyalaw.org/akn/ke/judgment/scc/2024/27/eng@2024-09-30

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.