Laikiana Resorts Lodges Ltd v Ndegwa

that the Plainti company incurred special damages of Kshs 309,095,779.00/=. He argued that the Defendant would not suer any prejudice if the orders sought are granted. The Respondent’s Case 5. The Respondent led a replying adavit dated 12th May 2025 in opposition to the application. He averred that the Plainti had voluntarily surrendered full possession of the suit property to him as shown in the further adavit sworn on 2nd February 2023, which was not challenged. He argued that the status quo at the time of the order was that the premises were in his exclusive possession and control. 6. He further averred that the application is bad in law because the Plainti invoked Sections 6 and 7 of the Arbitration Act to seek injunctive relief and to refer the dispute to arbitration. Additionally, he stated that the prayer for special damages is inconsistent with the prayer seeking the appointment of an arbitrator. He contended that the court would lack jurisdiction if it found that an arbitration agreement exists. He maintained that the Plainti had elected to rely on the arbitration clause and therefore cannot both accept and reject it by ling a claim for special damages in this court. 7. He further stated that he had led an originating summons against the Plainti, in which the court had issued directions. He asserted that the current application is an attempt to invoke the court's jurisdiction, which, he claims, does not exist. 8. The application was canvassed by way of written submissions. The Applicants Submissions 9. The Applicant led its submissions dated 29th May 2025. 10. On behalf of the Plainti, Counsel outlined the following issues for the court’s determination:a) Whether the court has discretion to allow an amendment of pleadings at this stage of the proceedings. b) Whether the Plainti has satised the legal threshold for amendment under Order 8 of the Civil Procedure Rules. c) Whether the proposed amendment will prejudice the Defendant or is made in bad faith. 11. Regarding the rst issue, Counsel submitted that the court has unfettered discretion to permit amendments to pleadings at any stage, as long as such changes are necessary for the court to eectively and conclusively resolve the key issues between the parties. He stated that the proposed amendment seeks to include material developments, such as special damages and a declaration that the Defendant breached the lease agreement. To support this point, reliance was placed on Order 8 Rule 3(1) of the Civil Procedure Rules and on the case of Joseph Yano v Stephen Kibet Kiptum (2019) KECA 509 (KLR) and Republic v Kenya Anti-Corruption Commission & 2 others (2009) KLR 31 cited in Muchoki & another v Elevator World Limited & another (2025) KEHC 6052 (KLR) 12. Regarding the second issue, Counsel submitted that the amendment is necessary to resolve the issues in controversy. Counsel further submitted that the application was led promptly after the material events that led to the new cause of action, and that the suit had not been scheduled for hearing. 13. It was submitted that although the existence of an arbitration clause is not disputed, the Defendant has actively participated in the proceedings without ling a formal application for a stay. To support this argument, reliance was placed on the case of Niazsons (K) Ltd v China Road & Bridge Corporation Kenya (2001) KECA 376 (KLR). https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/18583/eng@2025-12-11 2

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14. Counsel further submitted that the Applicant has met the threshold for amendment of pleadings outlined in the Court of Appeal case of St Patrick Hill School Limited v Bank of Africa Kenya Limited (2018) KEHC 2539 (KLR) 15. Finally, Counsel argued that the Defendant would not suer prejudice that cannot be remedied by costs if the amendment is permitted. It was also noted that the Defendant will have an opportunity to respond to the amended plaint. The Defendant’s Submissions 16. The Defendant led his submissions dated 28th May 2025. Counsel reiterated the contents of the replying adavit to support his submissions. Counsel submitted that the proposed amendments seek to change the character of the Plaint. Counsel urged the Court to dismiss the application with costs. Analysis And Determination 17. Having considered the application, the adavits, and the rival submissions, the only issue that arises for determination is whether the Plainti should be granted leave to amend his Plaint. 18. Section 100 of the Civil Procedure Act makes provisions on the general power to amend, and gives the Court discretion on whether to allow an amendment or not. 19. Further Order 8 Rule 5 of the Civil Procedure Rules provides as follows; “ (1) For purposes of determining the real question in controversy between the parties, or of correcting any defect or error in any proceedings, the court may, either of its own motion or on the application of any party order any document to be amended in such manner as it directs and on such terms as to costs or otherwise as are just.” 20. The law governing leave to amend pleadings is well established. The general rule is that amendments of pleadings sought before the hearing should be freely allowed if they can be made without causing injustice to the other side, and there is no injustice if costs can compensate the other party. The main principle is that an amendment should not be allowed if it causes injustice to the other side. 21. The Court of Appeal set out the principles under which Courts may grant leave to amend pleadings in the case of Ochieng and Others vs First National Bank of Chicago Civil Appeal No. 147 of 1991, where it was held that:a. The power of the court to allow amendment is intended to determine the true substantive merits of the case. b. The amendments should be timeously applied for. c. Power to amend can be exercised by the court at any stage of the proceedings. d. That, as a general rule, however late the amendment is sought to be made, it should be allowed if made in good faith, provided costs can be compensated to the other side. e. The plainti will not be allowed to reframe his case or his claim if by an amendment of the plaint the defendant would be deprived of his right to reply on limitations Act subject however https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/18583/eng@2025-12-11 3

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to powers of the court to still allow and amendment notwithstanding the expiry of the current period of limitation. 22. The Court has inherent power under Section 3A of the Civil Procedure Act to allow a party to amend its pleadings at any stage before judgment. The overriding considerations in an application for leave to amend are whether the proposed amendment is necessary to determine the real question in controversy and whether it would prejudice the opposing party. 23. In the matter at hand, the proposed amendment seeks to introduce a claim for special damages allegedly arising from acts said to have been committed after the ling of the suit and in violation of a court order. 24. The Defendant is opposed to the application on the grounds that the Plainti invoked Sections 6 and 7 of the Arbitration Act. Section 6 relates to stay of proceedings pending reference to arbitration, while Section 7 empowers the court to grant interim measures of protection. Neither provision ousts the court’s jurisdiction, particularly where no stay of proceedings has been granted. 25. The amendment sought does not alter the character of the suit or introduce a new cause of action. The question before this court at this stage is not whether the dispute is subject to arbitration, but whether the proposed amendment is necessary. The existence of an arbitration agreement in itself does not prevent the court from exercising its discretion under Order 8 Rule 5 of the Civil Procedure Rules. 26. This matter has not yet proceeded to hearing. The Defendant has not demonstrated what specic prejudice, if any, he will suer if the amendment is allowed, or that he will not be adequately compensated if the amendment is allowed at this stage. The Defendant will not be prejudiced because he will have an opportunity to respond to the amendment. 27. I nd that the amendment sought by the Plainti is necessary to determine the real question in controversy. 28. The upshot of the foregoing is that the Application dated 10th February 2025 is merited and I proceed to allow it in the following terms:a. Leave is granted to the Plainti to amend the Plainti in terms of the annexed draft amended Plaint. b. The amended Plaint shall be led and served within 14 days from the date hereof. c. That Defendant is granted leave to le and serve an amended defence within 14 days after service. d. That the Applicant shall meet the cost of this application. RULING SIGNED, DATED, AND DELIVERED VIA MICROSOFT TEAMS THIS 11TH DAY OF DECEMBER, 2025. …………………………………………… HON. T. MURIGI JUDGE In The Presence Of: Manthi holding brief for Mwiti for the Plainti Malesi holding for Gatheru Gathemia for the Defendant Ahmed – Court Assistant https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/18583/eng@2025-12-11 4

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