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Supreme CourtDismissedApplication E039 of 2023

Sundowner Lodge Limited v Kenya Tourist Development Corporation

Supreme Court of Kenya
8 December 2023
Philomena Mbete MwiluP. M. MwiluMohammed Khadhar IbrahimM. K. IbrahimSmokin Charles WanjalaS. C. WanjalaNjoki Susanna NdunguNjoki NdunguIsaac LenaolaI. Lenaola
1,622 words in judgment
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·~6 min to read original · ~4 min brief

The bottom line

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Supreme Court shuts down bid to reopen settled contract damages law.

What this practically means

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The Supreme Court dismissed an application to appeal a contract dispute, ruling that the law on general damages for breach of contract is already clear. General damages are not awarded unless there are exceptional, justified circumstances. The Court found the applicant was simply trying to re-argue facts already decided by lower courts, not raise a new legal issue of public importance.

Executive summary

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This was an application by Samuel Warugu Kimotho, a director of the applicant, seeking review of a Court of Appeal decision delivered on September 22, 2023, which declined to certify the intended appeal as one involving matters of general public importance under Article 163(4)(b) of the Constitution. The applicant argued that the intended appeal raised questions of general public importance concerning the recoverability of general damages for breach of contract, claiming that conflicting Court of Appeal decisions were causing confusion in legal practice. The respondent opposed the application, arguing that the law was well settled and that the applicant sought to revisit factual findings already resolved by the lower courts. The Supreme Court, in a unanimous judgment delivered by Deputy Chief Justice P. M. Mwilu, dismissed the application. The Court held that the Court of Appeal correctly applied the threshold for certification as set out in Hermanus Phillipus Steyn v Giovanni Gnecchi-Ruscone and Malcolm Bell v Daniel Toroitich Arap Moi. The Court found that the issue of general damages for breach of contract is well settled: they are not awardable except in exceptional circumstances, which must be justified. The Court further held that the applicant was essentially seeking a third bite at the cherry by attempting to revisit factual findings already resolved by the superior courts. The application was dismissed with costs to the respondent.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether the intended appeal raises questions of general public importance that transcend beyond the parties.
  2. 2.Whether the Court of Appeal misinterpreted its prior decisions on the recoverability of general damages for breach of contract, causing confusion in legal practice and among lower courts.
  3. 3.Whether the Court of Appeal decisions on the issue are conflicting and occasioning confusion to lower courts.

Key legal issues

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01

Whether the intended appeal raises matters of general public importance warranting certification under Article 163(4)(b) of the Constitution.

Holding

The Supreme Court held that the proposed issues did not meet the threshold for certification as matters of general public importance, as the law on general damages for breach of contract is well settled and the application sought to revisit factual findings already resolved by the lower courts.

Reasoning

The Court examined the judgments of the superior courts and found that both the High Court and Court of Appeal appreciated the general rule that general damages are not normally awarded in breach of contract cases save for exceptional circumstances. The Court of Appeal affirmed this rule and did not misinterpret its previous decisions. The applicant's attempt to raise conflicting decisions was unfounded, and the issues were essentially factual determinations between parties, not matters of general public importance. The Court concluded that the Court of Appeal correctly applied the threshold from Hermanus Phillipus Steyn v Giovanni Gnecchi-Ruscone.

p. 5
02

Whether the Court of Appeal's decisions on recoverability of general damages for breach of contract are conflicting and causing confusion.

Holding

The Supreme Court held that there is no ambiguity or conflict in the Court of Appeal's jurisprudence on this issue; the rule that general damages are not awardable for breach of contract except in exceptional circumstances is well settled.

Reasoning

The Court reviewed the decisions cited by the applicant, including Dharamshi v Karsan, Capital Fish Kenya Limited v Kenya Power & Lighting Company Limited, and others. It found that the Court of Appeal consistently applied the general rule with recognized exceptions. The Court of Appeal's ruling in this case affirmed that there is no ambiguity, and the issue of contradictory previous decisions does not arise. The applicant failed to demonstrate any confusion or conflict warranting Supreme Court intervention.

p. 5

Legal principles established

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  • Factual findings between parties alone do not justify Supreme Court certification as a matter of general public importance.
  • General damages for breach of contract are not awardable except in exceptional, justified circumstances.
  • A party cannot use certification to get a third chance to relitigate facts already settled by lower courts.
  • The Court of Appeal's jurisprudence on general damages for breach of contract is consistent and not conflicting.
  • Certification under Article 163(4)(b) requires an issue that transcends the parties' dispute and affects the public.

Court orders

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  1. 1.The originating motion dated and filed on October 4, 2023 be and is hereby dismissed.
  2. 2.The costs of this application be borne by the applicant.

The bench

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One judgment of the whole court — no separate or dissenting opinions.

Philomena Mbete Mwilu
P. M. MwiluDCJ
Currently serving
majority

Wrote the judgment

Mohammed Khadhar Ibrahim
majority
Smokin Charles Wanjala
S. C. WanjalaSCJ
Currently serving
majority
Njoki Susanna Ndungu
Njoki NdunguSCJ
Currently serving
majority
Isaac Lenaola
I. LenaolaSCJ
Currently serving
majority
On appeal from
Court of Appeal of Kenya
Nairobi Civil Application Sup No 19 of 2018
Jurisdiction invoked
Article 163(4)(b) of the Constitution of Kenya, section 15B of the Supreme Court Act No 7 of 2011, and rule 33 of the Supreme Court Rules, 2020

Relief refused

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Review of the Court of Appeal decision declining to certify the intended appeal as one involving matters of general public importance.

The Court of Appeal correctly interrogated the proposed issues against the threshold set out in Hermanus Phillipus Steyn case and found they did not warrant certification.

p. 5

Costs

The costs of this application be borne by the applicant.

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

We therefore, decline to vacate its finding.
p. 5 Court's refusal to disturb the Court of Appeal's decision on certification
Determinations of fact in contests between parties are not, by themselves, a basis for granting certification for an appeal to the Supreme Court.
p. 5 Principle that factual determinations do not warrant certification as matters of general public importance
the appellate court did not misinterpret its previous decisions that general damages are not awardable for breach of contract except in exceptional circumstances, which have to be justified.
p. 5 Affirmation of the rule on general damages for breach of contract

Key timeline

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2023-09-22
Court of Appeal declines to certify appeal as involving general public importance.
2023-10-04
Applicant files originating motion seeking Supreme Court review of the certification decision.
2024-01-01
Supreme Court dismisses the application with costs.

Practical implications

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For lawyers

Limit certification arguments to law

When seeking Supreme Court certification, focus on unsettled legal principles, not factual disputes. The Court will reject applications that merely rehash facts already decided. To succeed, demonstrate a conflict in precedent or a novel legal question affecting the public, not just your client.

For businesses

Plan contract remedies carefully

In contract disputes, you cannot claim general damages (e.g., for inconvenience) unless you prove exceptional circumstances. This ruling confirms that standard contract breach remedies are limited to actual losses. Plan your litigation strategy accordingly and document specific, quantifiable damages.

For individuals

Know your contract damage limits

If you sue someone for breaking a contract, you generally cannot get compensation for emotional distress or general inconvenience. You must prove specific financial losses. Only in rare, justified cases can you claim general damages. Know this before you go to court.

Frequently asked questions

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Can I appeal a contract case to the Supreme Court in Kenya?+

Only if your case raises a matter of general public importance that goes beyond your personal dispute. The Supreme Court will not hear appeals just because you disagree with factual findings. You must show a legal issue affecting many Kenyans.

What are general damages for breach of contract in Kenya?+

General damages are compensation for non-specific harm like inconvenience or distress. In Kenya, courts rarely award them for breach of contract. You can only get them in exceptional, justified circumstances. Most contract claims are limited to actual financial losses.

What does 'matter of general public importance' mean in Kenya?+

It is a legal issue that affects the public broadly, not just the parties in a case. Examples include constitutional questions or conflicting court decisions. The Supreme Court decides if an issue meets this high threshold before allowing an appeal.

Can I relitigate facts already decided by lower courts in Kenya?+

No. The Supreme Court will not allow you to re-argue facts that lower courts have already settled. This is called having a 'third bite at the cherry.' You must focus on new legal questions, not factual disputes.

Later judgments citing this (4)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Sundowner Lodge Limited v Kenya Tourist Development Corporation", Case Analysis (2023). Application E039 of 2023. Source: https://new.kenyalaw.orghttps://new.kenyalaw.org/akn/ke/judgment/kesc/2023/100/eng@2023-12-08

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