Maina v Riara Downs Management Public Ltd Company

arising under a Lease dated 31st May 2010 in respect of all that property known as Penthouse Number 9, Flat B, Riara Downs Apartments, being part of the development erected on Land Reference Number 330/350, Nairobi, situate on Riara Road behind The Junction Mall, Lavington (“the suit premises”). 5. The Respondent is a limited liability company incorporated for the purpose of managing the estate erected on Land Reference Number 330/350. It is described in the Lease as the Manager and is the entity entitled to the benet of the reversionary interest in the land upon which the estate stands. It is common ground that the Appellant is a member and shareholder of the Respondent, holding fteen shares as an inseparable incident of his lease. 6. By a plaint dated 4th August 2023 the Appellant sued the Respondent for Kshs. 1,286,745.00, particularised as follows: loss of short-term rental income Kshs. 730,000.00; cost of repairs Kshs. 223,640.00; forced furniture and household disposal loss Kshs. 303,105.00; and valuation fees Kshs. 30,000.00. He also sought interest and costs. 7. The Appellant’s case, as pleaded and as deposed to in his witness statement dated 4th August 2023, was that under Clauses 1 and 2 of the Lease the Respondent had covenanted, subject to payment of the monthly service charge, to keep in tenantable repair the main structure of the buildings and in particular the roof and outside walls, and to keep the common water pipes, drains, gutters and sewers in good repair and condition. He averred that between December 2021 and February 2022 water emanating from ruptured water storage tanks and leaking water pipes situated in the common area directly above the suit premises seeped into the suit premises and caused extensive damage to its walls, oor and internal xtures, including the ceiling, wardrobes and cabinets. 8. He further averred that despite repeated requests the Respondent declined or delayed to carry out the necessary repairs; that in order to mitigate his continuing loss he mobilised the owners of the other units in Block B, each of whom contributed Kshs. 15,000.00 towards a total of Kshs. 150,000.00 applied to the repair of the common area; that the Respondent thereafter expressly permitted the netting o of his Kshs. 15,000.00 contribution against his monthly service charge obligation; and that he himself expended Kshs. 223,640.00 in repairing and restoring the suit premises. 9. As to the balance of the claim, the Appellant averred that prior to the water damage the suit premises were let as a furnished apartment on the Airbnb platform, enjoying consistent bookings and generating substantial rental income; that following the damage the listing attracted negative reviews, bookings were cancelled and the listing was eventually delisted; that the suit premises lay unoccupied between February and March 2022 and thereafter had to be converted into a long-term rental unit at a reduced rent, occasioning a loss of short-term rental income of Kshs. 730,000.00; and that the furniture and household appliances previously used to furnish the unit had to be disposed of at prices below their open market value, occasioning an asset disposal loss of Kshs. 303,105.00. He relied on a loss valuation report dated 27th February 2023 prepared by Gimco Limited at a cost of Kshs. 30,000.00. 10. By a statement of defence dated 6th May 2024 the Respondent admitted the Appellant’s proprietorship and its own role as Manager. It pleaded that its obligation to maintain, repair, redecorate, light, clean or renew extended only to the main structural components and the common areas, and that the obligation was contingent upon all members paying the agreed monthly service charge. It denied the cause and extent of the damage and pleaded that any such damage may have resulted from factors beyond its control or from other sources. It pleaded that repairs were ordinarily undertaken within a reasonable time, and that urgent repairs necessitated by factors beyond its control were ordinarily addressed through collective contribution by lessees. It further pleaded that under Clause 1.3 of the Lease the Appellant was obliged to insure the premises; that under Clause 1.10 the https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 2

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premises were to be used as a single private residence for the accommodation of one family and not otherwise; that the Appellant was not to part with possession or assign without its consent, which consent was neither sought nor obtained; and that the disposal of the furniture was the Appellant’s own commercial decision. No counterclaim was led. 11. The Appellant led a reply to defence dated 13th May 2024 joining issue and denying any breach of the Lease on his part. 12. A notice of preliminary objection dated 20th September 2023, by which the Respondent contended that the trial court lacked jurisdiction by dint of section 6 of the Arbitration Act, was dismissed by Hon. S. A. Opande (PM) by a ruling delivered on 9th April 2024. That ruling has not been appealed and nothing turns on it in these proceedings. 13. The suit proceeded to hearing on 23rd October 2024 before Hon. Pamela Achieng’ (CM). 14. PW1, Kiragu Maina, the Appellant, described himself as an investor in real estate. He adopted his witness statement dated 4th August 2023 as his evidence in chief and produced the documents in his list and bundle of documents as Plainti’s Exhibits 1 to 10. In cross-examination he stated that the lease did not require him to seek permission to use the property as he did; that the lease indicated that the premises were to be used as a single residential property; that he had insured the residential premises but was never asked for the policy; that the other occupants took part in the repair of the common areas; that the Respondent was not involved in the negotiations for the sale of the furniture; and that he had tried to get the management to address the leakage but it declined. In re-examination he stated that the tenant who took up the premises was not using them for business; that he sold the furniture because the premises had become uninhabitable and the tenants cancelled; that he sold the goods as second-hand and would not obtain full value for them; that the leakage began in December 2021; and that the repairs to the common area were undertaken in 2022 by the property owners and not by the management company, while he sourced his own contractor for his apartment in March 2022. 15. The Respondent called four witnesses. DW1, Kuiyaki Gacanja, DW2, Victoria Mutheu Kivuva and DW3, Gad Ndegwa Kamau, all directors of the Respondent, adopted their witness statements dated 18th June 2024, 19th June 2024 and 13th June 2024 respectively. DW1 produced the documents in the Defendant’s list and bundle of documents dated 4th June 2024 as Defendant’s Exhibits 1 to 3. DW4, Meshack Odunga, an employee of One Stop Property Management Limited, the company contracted by the Respondent to manage the common areas, adopted his witness statement as his evidence in chief. 16. DW1 testied that the Respondent’s role is limited to the common areas and not individual units, and that the leakage was addressed on time. In cross-examination he admitted that the management company was made aware of the leakage in December 2021; that the storage tanks and pipes are in the common area; that it was the responsibility of the management company to maintain the common areas; that he had no proof of the communication by which owners were asked to pool resources; and that by February 2022 no action had been taken. DW3 testied that where there is damage to a unit it is the owner’s responsibility to repair. DW4 testied in cross-examination that the leak arose from the tanks in the common area; that he received the report of the leakage in December 2021; that the inlets of the leaking tanks were turned o in December 2021, which mitigated but did not resolve the problem; that repairs were done in February 2022; and that there were insucient funds to carry out the repairs. The judgment of the trial court 17. The trial court framed three issues: whether the Respondent breached the terms of the contract; whether the Appellant suered damage as a result of that breach; and whether the Appellant was entitled to the reliefs sought. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 3

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18. On the rst issue the trial court found that the damage began in December 2021; that several email exchanges established that the Respondent had been made aware of it but did not act to ensure repairs were undertaken; that by his email of February 2022 the Appellant had reported that the damage was worsening; and that DW4 had conrmed receiving reports of a signicant leak from the rooftop water tanks and pipes of Block B in late December 2021 and eecting only a temporary arrest of the leak. The court found that the Respondent was under an obligation to carry out the repairs but, in breach of the contract, failed to do so within a reasonable time, the repairs having been eected only in February 2022. It found no evidence that the Appellant was in arrears of service charge and held that the plea of want of funds was not valid. 19. On the second issue the trial court noted the loss valuation report of Gimco Limited dated 27th February 2023, which assessed repair costs at Kshs. 241,930.00, and noted the further claims of Kshs. 730,000.00 for lost Airbnb income and Kshs. 303,105.00 for the disposal of the furniture and household items. 20. The trial court then set out Clause 1.10 of the Lease and concurred with the defence that in using the property to operate an Airbnb business the Appellant was in breach of that clause, which required the property to be used as a single private residence accommodating one family and not for any other purpose. It held that the Appellant could not therefore claim loss suered as a result of that use. The court rejected the defence founded on Clause 1.3, holding that there was no evidence that insurance would have covered the damage and that in any event the contract was clear that the repairs were the Respondent’s obligation. 21. On reliefs the trial court held that the Appellant was entitled only to the cost of repairing his apartment, which at paragraph 15 of the plaint was pleaded at Kshs. 223,640.00, together with valuation fees of Kshs. 30,000.00. It entered judgment for Kshs. 253,640.00 plus costs and interest at court rates from the date of ling suit until payment in full. A decree issued on 3rd February 2025. The appeal, the cross-appeal and the interlocutory proceedings 22. The memorandum of appeal dated 31st January 2025 raises two grounds, namely that the learned trial magistrate erred in fact and in law: rst, in nding that the Appellant was in breach of Clause 1.10 of the Lease dated 31st May 2010 by letting the suit premises on short-term tenancies through the Airbnb platform; and second, that as a consequence of that erroneous nding she erred in dismissing the Appellant’s claim for Kshs. 730,000.00 on account of loss of short-term rental income and Kshs. 303,105.00 on account of the loss occasioned by the disposal of his furniture and household items below market value. The Appellant seeks that the appeal be allowed, that judgment be entered for him in the further sum of Kshs. 1,033,105.00, and that he be awarded the costs of the appeal. 23. The memorandum of cross-appeal dated 5th November 2025 raises ve grounds, namely that the learned trial magistrate erred in law and in fact: rst, in failing to nd that the only water tanks operated by the Respondent are those located within the common areas, at the guard house and adjacent to the pool area, and that the Respondent is responsible only for paying the Nairobi City Water and Sewerage Company bills for those tanks; second, in failing to nd that the water tanks situated within the apartment blocks are privately owned by individual unit owners, lie beyond the Nairobi City Water and Sewerage Company metering point, and are the sole responsibility of the respective owners to clean, maintain and pay for; third, in nding that the Respondent was in breach of contract when it delayed the repair process, despite a lack of supporting evidence; fourth, in failing to nd that there was no credible evidence on record to support the conclusion that the Respondent had breached the contract; and fth, in disregarding the totality of the Respondent’s pleadings, submissions and cited https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 4

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authorities and thereby arriving at ndings of fact and law that were materially unsupported. The Respondent seeks that the appeal be dismissed with costs and that the cross-appeal be allowed with costs. 24. The progress of this appeal has been attended by interlocutory proceedings which it is convenient to record, both because they explain the manner in which the cross-appeal came to be lodged and because they bear directly upon the consequential orders which this judgment must make. 25. Judgment having been delivered on 23rd January 2025 and a decree having issued on 3rd February 2025, the trial court issued an ex parte garnishee order nisi on 7th April 2025 against two of the Respondent’s bank accounts, held at Diamond Trust Bank of Kenya Limited and NCBA Bank Kenya PLC, by which a total of Kshs. 996,304.00 was frozen. 26. By an application dated 15th April 2025 the Respondent moved this court for a stay of execution, for extension of time within which to lodge a cross-appeal and for security. By a ruling delivered on 28th October 2025 this court (Kemei J) allowed the application and ordered a stay of execution pending the hearing and determination of the appeal and the intended cross-appeal; granted leave to lodge the cross-appeal within seven days; directed the deposit of Kshs. 253,640.00 into a joint interest-earning account held in the names of the parties’ respective advocates within fourteen days; and directed the ling of the record of appeal within fourteen days of the ling of the memorandum of cross-appeal, in default of which the orders would lapse automatically. 27. The Respondent complied with those conditions. The memorandum of cross-appeal was led on 5th November 2025; the sum of Kshs. 253,640.00 was deposited on 10th November 2025 into an account at I&M Bank (CIF – 0805750) held in the names of the parties’ respective advocates; and the Respondent’s record of appeal was led and served on 10th November 2025. 28. The competence of the cross-appeal is therefore not in issue. It was lodged with the leave of this court, its compliance with the conditions upon which that leave was granted has been the subject of an express nding by this court, and no objection has been taken to it by the Appellant, whether in his written submissions or otherwise. I have accordingly considered the cross-appeal on its merits. 29. Finally, by a ruling delivered on 18th June 2026 this court discharged the ex parte garnishee order nisi of 7th April 2025, directed the release of the frozen funds save for the sum of Kshs. 253,640.00, and preserved that sum in the joint interest-earning account as security for the judgment debt pending the hearing, determination and nal disposition of the appeal and the cross-appeal. That deposit remains in place and falls to be dealt with in the disposition of this judgment. On the same day the court gave directions for the ling of written submissions. Submissions 30. Pursuant to those directions the Appellant led written submissions dated 6th July 2026 through the rm of Mutua Waweru Advocates LLP, with copies of the authorities relied upon annexed. The Respondent led written submissions dated 29th July 2026 through the rm of Njoroge Regeru & Company Advocates, together with a list and bundle of authorities of even date. I have considered both sets of submissions and the authorities cited in them, and I summarise them below. (a) The Appellant’s submissions 31. On the duty of this court, counsel submitted that this being a rst appeal the court sits in eect as a court of retrial, bound to reconsider and re-evaluate the evidence and draw its own conclusions, bearing https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 5

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in mind only that it did not see or hear the witnesses, relying on Selle & another v Associated Motor Boat Company Limited [1968] EA 123. 32. On the rst ground, counsel invoked Jiwaji v Jiwaji [1968] EA 547 for the proposition that where there is no ambiguity in an agreement it must be construed according to the clear words used by the parties. He submitted that on its clear wording Clause 1.10 is directed at the purpose and manner of use, and not at the identity of the occupant or the medium through which an occupant is sourced; that both limbs of the clause turn on the character of the actual use and its eect; and that the clause nowhere prohibits letting, short-term letting, or the use of any letting platform, including Airbnb. Provided the occupants sourced through the platform occupied the suit premises for residential purposes only and caused no nuisance, annoyance or injury to the reputation of the Estate, there was no breach. 33. Counsel submitted that the learned trial magistrate’s entire nding on the issue is contained in a single conclusory sentence, and that it treated the mere fact of listing and letting the suit premises on Airbnb as automatic and self-proving evidence of breach, without any inquiry into whether the actual use to which the premises were put by those who occupied them fell outside the permitted purpose, or whether that use caused any nuisance, annoyance or injury. He emphasised that the characterisation of Airbnb as a global online marketplace operating as a commercial hospitality platform, involving frequent turnover of occupants and public reviews and ratings, upon which the nding appears to rest, was advanced only in the Respondent’s written submissions at trial; it was not evidence adduced by any witness, and no witness testied as to the actual manner in which any short-term occupant used the suit premises. A nding of breach of a specic contractual covenant, he submitted, cannot properly rest on submissions of counsel as to the general business model of a third-party platform. 34. By treating the use of the platform as synonymous with breach, counsel submitted, the trial court in eect read into Clause 1.10 a restriction against short-term or platform-based letting that the parties never agreed upon, and thereby rewrote the contract between them, contrary to National Bank of Kenya Limited v Pipeplastic Samkolit (K) Limited & another [2001] KECA 362 (KLR), in which the Court of Appeal held that a court of law cannot re-write a contract between the parties and that the parties are bound by the terms of their contract unless coercion, fraud or undue inuence are pleaded and proved. 35. Counsel further submitted that Clause 1.10 itself recognises that persons other than the Appellant may lawfully occupy the suit premises. It prohibits the Lessee from using the premises “or permitting them to be used” for a purpose other than as a single private residence, and refers throughout to the “owners or occupiers” of ats within the Estate. Those words would be rendered otiose if the clause were read as conning occupation strictly to the Appellant himself. The proper inquiry, which the trial court did not undertake, was whether the persons who occupied the premises used them otherwise than as a single private residence for the accommodation of one family at a time, or whether their occupation caused nuisance, annoyance or injury of the kind the clause proscribes; and the burden of proving breach lay on the Respondent as the party asserting it. 36. On the second ground, counsel relied on Dormakaba Limited v Architectural Supplies Kenya Limited [2021] KEHC 210 (KLR) for the elements of a claim in damages for breach of contract, namely the existence of a contract, its breach by the defendant, and loss suered by the plainti in consequence. He submitted that the existence of the Lease and the Respondent’s breach of its repair obligations are not in issue in this appeal, and that the sole basis upon which the trial court declined to award the two disputed heads was its nding of breach of Clause 1.10 on the part of the Appellant. Once that nding is shown to be erroneous, he submitted, the causal foundation for dismissing the claim falls away with it. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 6

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37. On the measure of damages counsel cited Consolata Anyango Ouma v South Nyanza Sugar Company Limited [2015] eKLR, which restates the principle of restitutio in integrum and the rule in Hadley v Baxendale (1854) 9 Exch 341, and conrms that damages of this character are in the nature of special damages which must be pleaded and proved. He submitted that loss of short-term rental income from a property let for that very purpose, and loss occasioned by the forced disposal of furniture below market value following delisting, ow naturally from a lessor’s failure to repair a leak which renders a short-stay rental property unt for its purpose, and were within the reasonable contemplation of both parties at the time the Lease was entered into, the Respondent as Manager having been aware of and not having objected to the letting arrangement for a considerable period before the leak. He submitted that both sums were pleaded, and were supported by the loss valuation report and by the platform correspondence evidencing the delisting; that the trial court dismissed neither head for want of pleading or want of proof; and that the judgment does not impugn the report, the correspondence or any other item of evidence going to quantum. 38. On the cross-appeal, counsel submitted that grounds 1 and 2 are not properly before the court because they raise factual issues that were neither pleaded, canvassed nor proved below. He relied on Kenya Revenue Authority v MAN Diesel & Turbo SE, Kenya [2021] KEHC 13347 (KLR), in which the court, following Girdhari Lal Vidyarthi v Ram Rakha [1957] EA 527 and Tanganyika Farmers Association Limited v Unyamwezi Development Corporation Limited [1960] EA 620, held that although an appellate court has a discretion to allow a new point to be taken on appeal, it will not do so where the matter was not properly pleaded or where the facts bearing on the new point were not elicited in the court below, and that an appellant cannot reconstruct its case at that late hour by introducing new matters. He submitted that the distinction now drawn between common-area tanks and block-level tanks was never pleaded in the statement of defence, never put to the Appellant in cross-examination and never canvassed in the evidence of any of the Respondent’s four witnesses, and that the witness responsible for managing the common areas instead described the leaking rooftop tanks and pipes at Block B as forming part of the development’s common areas and facilities which the Respondent is responsible for maintaining. 39. On grounds 3, 4 and 5, counsel submitted that the Respondent’s obligation to maintain the common areas was expressly admitted at paragraph 5 of the statement of defence; that the leakage was reported in December 2021 and only temporarily arrested; that on the Respondent’s own witness’s account nothing eective was done until unit owners themselves mobilised funds in January 2022, with repairs completed only in February 2022; that the Appellant’s contemporaneous email and his advocates’ letter of 17th February 2022 conrm that position; and that the plea of insucient funds was rejected by the trial court and was in any event unsupported by any account statement or communication calling for contributions. A bare assertion of impecuniosity, he submitted, cannot excuse a two-month delay in attending to a known and continuing leak. 40. The Appellant accordingly prays that the appeal be allowed, that the part of the judgment dismissing the claims for Kshs. 730,000.00 and Kshs. 303,105.00 be set aside, that judgment be entered for him in the additional sum of Kshs. 1,033,105.00, that he be awarded the costs of the appeal, and that the cross-appeal be dismissed with costs. (b) The Respondent’s submissions 41. Counsel for the Respondent began by describing the nature of his client. The Respondent is a management company incorporated solely for the purpose of managing the common areas of sixtyeight apartment units on behalf of the owners and residents, who are the benecial stakeholders in the subject matter of the appeal. Its mandate is not commercial; its directors are themselves homeowners https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 7

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within the estate; and its sole source of funds is the service charge contributions of the residents, which are reserved for security, cleaning, utilities and the maintenance of the common areas. 42. Counsel accepted the principle in Selle but submitted that on a proper re-evaluation of the evidence and a correct construction of Clause 1.10 the nding of the trial court was right. On the approach to construction he relied on Twiga Chemicals Industries Limited v Allan Stephen Reynolds [2014] eKLR, citing Savings and Loan Kenya Limited v Mayfair Holdings Limited [2012] eKLR and Investors Compensation Scheme Limited v West Bromwich Building Society [1998] 1 WLR 896, for the proposition that the intention of the parties is to be ascertained objectively from the document, the question being not what either party meant or understood by the words used but the meaning the clause would convey to a reasonable person having all the background information available to the parties at the time of the contract; and on Euromec International Limited v Shandong Taikai Power Engineering Company Limited (Civil Case E527 of 2020) [2021] KEHC 93 (KLR) to the same eect. 43. Counsel submitted that Clause 1.10 comprises two distinct and independently operative limbs: a positive covenant restricting the permitted use of the premises to use as a single private residence for the accommodation of one family, and a separate covenant prohibiting any use which is or becomes a nuisance or annoyance to neighbouring owners or occupiers or which is injurious or detrimental to the reputation of the Estate. The trial court’s nding, he submitted, rested on the rst limb, and the Respondent was accordingly not required to establish nuisance, annoyance or reputational harm in order to prove a breach. He submitted that the Appellant’s argument is directed exclusively at the second limb and therefore proceeds on a misapprehension of the covenant. 44. Analysing the rst limb element by element, counsel submitted that “single” contemplates occupation as one residential unit, whereas Airbnb operations involve a succession of unrelated bookings by dierent paying guests; that “private” is negatived by listing the premises to members of the public for reward, thereby opening them to an indenite class of paying guests; that “residence” imports permanence, continuity and settled occupation, which short stays measured in days lack; that “accommodation of one family” contemplates occupation by one identiable family unit, whereas Airbnb accommodation is oered to unrelated individuals or groups whose identities change with every booking; and that the use is commercial in character, fundamentally altering the character of the premises from a private residence to a short-stay commercial letting enterprise. He invited the court to take judicial notice of the fact that Airbnb is an internationally recognised online marketplace for short-term accommodation through which owners list accommodation as hosts and members of the public book as guests, and submitted that Kenyan law itself recognises the distinction between private residential occupation and accommodation oered to paying guests, the Tourism Act and the framework established thereunder empowering the Tourism Regulatory Authority to register, license and regulate private residences engaged in guest house services. 45. Counsel submitted that, in any event, if proof of the character of the use were required, the Appellant’s own pleaded case and the documents upon which he relies establish it: he relies upon a loss valuation report, upon Airbnb correspondence evidencing the delisting of the suit property, and upon a claim for loss of Airbnb income occasioned by negative reviews. Those documents demonstrate, on the Appellant’s own case, that the premises were being commercially oered to successive paying guests. The Appellant cannot rely on those facts to advance a claim for damages while simultaneously denying the very character of the use upon which the claim is founded. A party who elects to enforce a contract must accept that it binds both parties in its entirety, and may not selectively rely on the provisions imposing obligations upon the other party while denying the operation of the restrictive covenant imposed upon himself: See the case of Agriculture Finance Corporation & another v Kenya Alliance Insurance Company Limited & another [2002] eKLR. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 8

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46. On the two disallowed heads of loss, counsel submitted that they are speculative, legally unrecoverable and unsupported by credible evidence. Applying Hadley v Baxendale, upon which the Appellant himself relies, the alleged loss of Airbnb income and the alleged loss arising from the disposal of furniture acquired for use in an Airbnb business cannot as a matter of law have been within the reasonable contemplation of the parties when they entered into the Lease, since Clause 1.10 expressly prohibited the use of the premises for such commercial purposes. The Appellant cannot recover damages owing from an activity which the Lease itself prohibited, and no party should be permitted to benet from his own wrongdoing: See Mohamed v Bakari & 2 others (2005) 2 EA 213. 47. Counsel further submitted that the alleged losses were not strictly proved. The valuation report relied upon is speculative and based on projected earnings rather than actual loss incurred; the sums realised on the sale of the furnishings were the product of transactions between a willing seller and a willing buyer in the open market; and the maker of the report was not called to testify, with the result that its methodology, assumptions and conclusions were never explained or subjected to cross-examination. In the absence of compliance with section 35 of the Evidence Act, he submitted, the report ought to have been accorded no evidential weight. He also drew attention to the Appellant’s written instruction to his advocates that he wished to take the Respondent “to the cleaners”, submitting that this discloses an intention to pursue the Respondent beyond the recovery of legally recoverable loss. 48. On the cross-appeal, counsel submitted that while it is not in dispute that the Respondent was responsible for maintaining and repairing the common areas, the Lease must be construed as a whole, and it did not impose upon the Respondent any obligation to repair damage occurring within an individual unit. Clause 1.3 required the Appellant to insure his apartment against loss or damage by re and such other risks as residential premises are ordinarily insured against, so that the parties made separate contractual provision for the maintenance of the common property and for the protection of individual units. The burden lay on the Appellant under sections 107 and 109 of the Evidence Act to identify the provision of the Lease imposing upon the Respondent an obligation to undertake or nance repairs within his private premises, and he failed to do so. The trial court, he submitted, further erred in dismissing Clause 1.3 as irrelevant on the sole basis that there was no evidence that an insurance policy would have responded to the loss, when the covenant formed part of the contractual allocation of risk agreed between the parties. 49. On the question of delay, counsel submitted that the uncontroverted evidence of DW4 was that immediately upon being notied of the leak the Respondent shut o the leaking pipes as an interim measure to prevent further damage, thereafter sourced a plumber, obtained a quotation, mobilised the requisite funds in January 2022 and completed the permanent repairs in February 2022. He submitted that the trial court misapprehended the Respondent’s evidence on funding: its case was never that the Appellant was in arrears of service charge, but that the management company did not have sucient funds immediately available; and the trial court’s own nding that the Appellant and the other aected homeowners each contributed Kshs. 15,000.00 supports rather than undermines that explanation. There was, he submitted, no evidence that the Respondent possessed the necessary funds but deliberately declined to carry out the repairs. 50. The Respondent accordingly prays that the appeal be dismissed with costs, that the cross-appeal be allowed with costs, that the awards of Kshs. 223,640.00 in repair costs and Kshs. 30,000.00 in valuation fees be set aside, and that the Appellant’s suit be dismissed with costs. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 9

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Issues for determination 51. Having considered the memorandum of appeal, the memorandum of cross-appeal, the record of the trial court and the submissions of both parties, I am of the view that the following issues fall for determination: (i) What is the duty of this court sitting as a rst appellate court? (ii) Whether the trial court erred in nding the Respondent to have been in breach of the Lease dated 31st May 2010, which is the subject of the cross-appeal. (iii) Whether the trial court erred in nding the Appellant to have been in breach of Clause 1.10 of the Lease by letting the suit premises on short-term tenancies through the Airbnb platform. (iv) Whether the Appellant established an entitlement to Kshs. 730,000.00 as loss of short-term rental income and Kshs. 303,105.00 as asset disposal loss. (v) What orders ought to issue, including as to costs. Analysis and determination (i) The duty of this court on a rst appeal 52. This being a rst appeal, the duty of this court is to re-evaluate the evidence tendered before the trial court, assess it afresh and draw its own conclusions, bearing always in mind that it neither saw nor heard the witnesses testify and making due allowance in that respect. The principle is settled in Selle & another v Associated Motor Boat Company Limited [1968] EA 123, where the predecessor Court of Appeal held that an appeal from the High Court is by way of retrial and the appellate court is not bound necessarily to follow the trial judge’s ndings of fact if it appears either that he failed to take account of particular circumstances or probabilities, or that the impression based on the demeanour of a witness is inconsistent with the evidence generally. Both parties accept that this is the applicable standard. 53. That freedom is, however, not unqualied. In Peters v Sunday Post Limited [1958] EA 424 it was held that an appellate court will not lightly dier from a nding of fact of a trial judge who had the advantage of seeing and hearing the witnesses, and will interfere only where it is satised that the trial court plainly went wrong. Section 78 of the Civil Procedure Act confers on this court the same powers and duties as a court of original jurisdiction. (ii) The cross-appeal: whether the Respondent breached the Lease 54. It is convenient to take the cross-appeal rst, because if it succeeds the appeal falls away entirely. 55. Before turning to the grounds, one observation about the manner in which the cross-appeal has been argued is necessary. Grounds 1 and 2, which are the tank-ownership and metering grounds, were not developed in the Respondent’s written submissions beyond a passing reference in the background section. Conversely, the argument principally advanced in those submissions, namely that the Lease imposed upon the Respondent no obligation to repair damage occurring within an individual unit and that Clause 1.3 allocated that risk to the Appellant, does not correspond to any ground set out in the memorandum of cross-appeal. Since the Respondent has not formally abandoned grounds 1 and 2, and since the argument actually advanced goes to the very award which the cross-appeal seeks to set aside, I propose to deal with all of the grounds pleaded and with the argument advanced. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 10

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56. Grounds 1 and 2 of the cross-appeal assert that the only water tanks operated by the Respondent are those located in the common areas at the guard house and adjacent to the pool; and that the water tanks situated within the apartment blocks are privately owned by individual unit owners, lie beyond the Nairobi City Water and Sewerage Company metering point, and are the sole responsibility of the respective owners. 57. These grounds encounter two insurmountable diculties. 58. First, the contention was never pleaded. The statement of defence dated 6th May 2024 pleaded, at paragraph 5, that the Respondent is responsible for maintaining, repairing, redecorating, lighting, cleaning or renewing the main structural components of the building, including the roof, walls, foundation, sewers, gutters and pipes within the estate premises forming the common areas only, and at paragraph 8 that it is responsible only for the common areas and not for individual premises or units. Nowhere did the Respondent plead that the rooftop water tanks and pipes serving Block B were not part of the common areas, or that they were privately owned by unit owners, or that they lay beyond any metering point of the water services provider. 59. Second, and more fundamentally, the contention is directly contradicted by the Respondent’s own evidence at trial. The witness statements of DW1 and DW2 deposed in identical terms that the water storage tanks and piping system serve the Apartment and are part of the development’s common areas and facilities that the Respondent is responsible for maintaining, and DW4, the very witness charged with the management of the common areas, deposed that the water storage tanks and piping system on the rooftop are part of the ageing infrastructure that serves Riara Downs Apartments. In crossexamination DW1 expressly conceded that the storage tanks and pipes are in the common area and that it was the responsibility of the management company to maintain the common areas, and DW4 testied that the leak arose from the tanks at the common area. Not a shred of evidence was led at trial about any metering point of the Nairobi City Water and Sewerage Company or about private ownership of the block tanks. 60. It is elementary that parties are bound by their pleadings and that a court may only determine the issues that arise from them. In Gandy v Caspair Air Charters Limited (1956) 23 EACA 139 it was held that the object of pleadings is to give fair notice of the case which has to be met, so that the opposing party may direct his evidence to the issues disclosed by them. The principle was restated by the Court of Appeal in Independent Electoral and Boundaries Commission & another v Stephen Mutinda Mule & 3 others [2014] eKLR, in Galaxy Paints Company Limited v Falcon Guards Limited [2000] 2 EA 385, and in Abok James Odera t/a A. J. Odera & Associates v John Patrick Machira t/a Machira & Company Advocates [2013] eKLR. The related principle governing new points taken for the rst time on appeal is that stated in Kenya Revenue Authority v MAN Diesel & Turbo SE, Kenya [2021] KEHC 13347 (KLR), upon which the Appellant relies: an appellate court will not permit a new point to be taken where the matter was not properly pleaded or where the facts bearing upon it were not elicited in the court below, and a party may not reconstruct its case at that late hour by introducing new matters. That is precisely what grounds 1 and 2 attempt. 61. A party cannot plead and prove one case at the trial and then advance on appeal a case diametrically opposed to it. Article 159(2)(d) of the Constitution requires that justice be administered without undue regard to procedural technicalities, but it is not a licence to abandon on appeal the case that was pleaded, admitted and testied to below. Grounds 1 and 2 of the cross-appeal are wholly without merit and are rejected. 62. I turn to the argument that the Lease imposed upon the Respondent no obligation to repair damage occurring within an individual unit, and that the trial court erred in holding it liable for the cost https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 11

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of repairs within the Appellant’s private premises. Quite apart from the fact that this argument corresponds to no ground of the cross-appeal, it misconceives the basis upon which the award was made. The trial court did not hold that the Respondent was under a contractual obligation to repair the interior of the Appellant’s apartment, and no such obligation is asserted in this judgment. What the trial court held was that the Respondent had breached its own covenant in respect of the common areas, and that the cost of making good the damage which that breach caused within the suit premises was recoverable as damages. 63. That is orthodox. Where a party sustains a loss by reason of a breach of contract he is, so far as money can do it, to be placed in the same situation, with respect to damages, as if the contract had been performed. The measure of the Appellant’s loss is not conned to the physical extent of the Respondent’s repairing covenant; it extends to the damage which the breach of that covenant in fact caused. Water which escapes from a common-area tank does not stop at the boundary of the common area. To conne recovery to the cost of repairing the tank itself would be to deny the Appellant any remedy for the very consequence the covenant was designed to prevent. Sections 107 and 109 of the Evidence Act do not assist the Respondent: the Appellant did not have to prove a repairing obligation in respect of the interior, because he never asserted one. He had to prove breach, causation and loss, and he did. 64. Nor does Clause 1.3 avail the Respondent. An obligation upon a lessee to insure his own premises does not, in the absence of clear words to that eect, exonerate the manager from liability for the consequences of its own breach of covenant, and Clause 1.3 contains no such words. The clause does not provide that the manager shall be relieved of liability for damage which is or ought to be insured, nor does it require the policy to be eected in joint names or to contain a waiver of subrogation, which are the ordinary contractual mechanisms by which such a transfer of risk is eected. Beyond that, no evidence was led that the risk which eventuated was insured or insurable, or that any policy would have responded to it. PW1 testied that he had insured the premises but was never asked to produce the policy, and the Respondent did not pursue the point. The trial court was right to reject the defence founded on Clause 1.3, and I would add only that the clause could not in any event have been decisive, because the Respondent has never pleaded or proved that the Appellant failed to insure. 65. Grounds 3 and 4 challenge the suciency of the evidence supporting the nding of breach. Clause 2.2 of the Lease obliged the Manager, subject to contribution and payment by the Lessee, to keep in tenantable repair and decoration the main structure of the buildings and in particular the roof and outside walls, and Clause 2.4 obliged it to keep the common water pipes, drains, gutters and sewers in good repair, condition, upkeep and maintenance and to eect such repairs thereto as might from time to time become necessary or desirable. 66. On a fresh evaluation of the record, the evidence supporting the nding of breach is substantial and largely emanates from the Respondent’s own witnesses. DW4 deposed that he received reports of a signicant leak from the rooftop water tanks and pipes of Block B in late December 2021; that the leaking pipes were turned o as a temporary measure only; that investigation of the source took about two weeks; that there were insucient funds in the maintenance account; that the owners of units in Block B mobilised themselves in January 2022 to contribute Kshs. 15,000.00 each as advance service charge; and that the repair works were completed in February 2022. DW1 conceded in crossexamination that the Respondent was aware of the leak from December 2021, that by February 2022 no action had been taken, and that he had no proof of the communication by which owners were said to have been asked to pool resources. 67. That evidence is reinforced by the Appellant’s documentary exhibits: the correspondence in which he and his advocates complained of the delay; his contemporaneous email of mid-February 2022, some https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 12

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two months after the leak was reported, recording that the directors had been handed a plumber’s quotation but had declined to sign the cheques so that work could commence; the letter of his advocates dated 17th February 2022 giving seven days’ notice that he would himself undertake the repairs and seek recovery of the cost; and the service charge statement recording the crediting of his Kshs. 15,000.00 contribution as an advance payment of service charge. That last item is signicant: a manager which credits a lessee’s repair contribution against service charge is, in substance, acknowledging that the cost of the repair was its own to bear. 68. The Respondent’s answer, that its obligation was contingent upon the payment of service charge by all members, does not avail it. It neither pleaded nor proved that any member, and in particular the Appellant, was in arrears. No account statement was produced. The submission that the Respondent’s case was never one of arrears but of funds not being immediately available does not improve the position; if anything it concedes it. The administration of the maintenance account is the Respondent’s own function, and a manager cannot rely upon a shortfall in a fund which it alone administers as an answer to a covenant which that fund exists to discharge. Clause 4.1 of the Lease furnished the Respondent with an express remedy against a defaulting lessee, which it never invoked, and the Lease nowhere provides for the ad hoc contributions upon which the Respondent’s defence was built. 69. For the same reason I am unable to accept the submission that the trial court’s nding that each aected homeowner contributed Kshs. 15,000.00 corroborates the Respondent’s explanation rather than undermining it. That the lessees had to fund the repair of the common areas themselves, and were credited for doing so, is not a defence to the complaint; it is the substance of the complaint. It establishes that the money was found once the lessees found it, and that it was not found by the Respondent within a reasonable time of the leak being reported. 70. Whether repairs were eected within a reasonable time is a question of fact and degree. On this record a leak reported in late December 2021, temporarily arrested but not remedied, and nally repaired in late February 2022 only after the aected lessees themselves raised the money, was not a repair eected within a reasonable time. The trial court’s nding was amply supported by the evidence and I see no basis to disturb it. Grounds 3 and 4 fail. 71. Ground 5 is an omnibus complaint that the trial court disregarded the totality of the Respondent’s pleadings, submissions and cited authorities. A ground framed at that level of generality does not comply with the requirement that grounds of appeal be set out concisely and under distinct heads specifying the points of law or fact said to have been wrongly decided. In any event, a court is not obliged to rehearse every argument or authority placed before it, provided it addresses the real issues in controversy. The trial court framed the issues, considered the competing cases and gave reasons. Ground 5 fails. 72. The cross-appeal is accordingly devoid of merit in its entirety. (iii) Whether the Appellant breached Clause 1.10 of the Lease 73. Clause 1.10 of the Lease provides that the Lessee covenants: “ Not to use or permit to be used the premises for any purposes other than as a single private residence for the accommodation of one family and not for any purposes or in any manner which may at any time be or become a nuisance or annoyance to the owners or occupiers of any ats in the said Estate or be injurious or detrimental to the reputation of the Estate as a private residential Estate.” https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 13

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74. The clause has two limbs: a use limb, conning the purpose of use to that of a single private residence for the accommodation of one family; and a nuisance and reputation limb, protecting the other lessees and the residential character of the estate. I accept the Respondent’s submission that the two limbs are independently operative, and that a breach of the rst does not require proof of nuisance, annoyance or reputational injury. The trial court’s nding rested on the rst limb, and it is upon that limb that this issue turns. 75. The task is one of construction, and the principles are not in dispute. The intention of the parties is ascertained objectively from the words they used, read in their documentary, factual and commercial context, the question being not what either party meant or understood by those words but the meaning the clause would convey to a reasonable person having all the background knowledge available to the parties at the time of the contract: See the cases of; Twiga Chemicals Industries Limited v Allan Stephen Reynolds [2014] eKLR and Euromec International Limited v Shandong Taikai Power Engineering Company Limited (Civil Case E527 of 2020) [2021] KEHC 93 (KLR). Where the words are clear they are to be given their natural and ordinary meaning: See Jiwaji v Jiwaji [1968] EA 547. 76. The Appellant’s position below, which is reproduced as the rst ground of appeal, was that so long as the persons sourced through the online platform occupied the suit premises for residential purposes there was no breach of Clause 1.10, and that the requirement of consent under Clause 1.20 was directed at parting with possession or assignment pursuant to a sale. 77. I accept a substantial part of that argument. Clause 1.10 does not prohibit letting as such. It regulates the purpose and manner in which the premises are used; it does not regulate the mechanism by which the lessee derives income from his interest. I accept, too, the Appellant’s submission that the words “or permit to be used” and the references to “owners or occupiers” would be robbed of content if the clause were read as conning occupation to the lessee personally. The clause plainly contemplates that a lessee may permit others to occupy his unit. There is nothing in it which prevents a lessee from letting the suit premises to a family which will occupy them as a single private residence. The Appellant did precisely that when he converted the unit into a long-term rental, and no complaint has ever been made of it. To the extent that the Respondent’s pleaded case suggested that any letting whatsoever oended Clause 1.10, that case was misconceived. 78. But that is not the question which the record poses. The permission to allow others to occupy is a permission to allow them to occupy for the permitted purpose; it is not a permission to put the premises to a dierent use altogether. The question is therefore whether the use to which these premises were in fact put a furnished apartment marketed on a public online marketplace, occupied by a succession of unrelated transient guests on short bookings, operated under a listing carrying guest ratings and reviews, and generating what the Appellant himself described as handsome rental income is use “as a single private residence for the accommodation of one family”. 79. In my respectful view it is not, for four reasons. (a) The words “a single private residence” import a measure of permanence and settled occupation. Premises occupied by a stream of guests, each for a matter of days, are not being used as anybody’s residence. They are being used as short-stay accommodation. (b) The qualier “for the accommodation of one family” reinforces that reading. A succession of unconnected bookings by dierent individuals and groups is not the accommodation of one family. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 14

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(c) The word “private” is not surplusage. It stands in contradistinction to premises held out to the world at large. A listing on a public online marketplace accessible internationally is the antithesis of private residential use. (d) The second limb of the clause, which protects the reputation of the estate “as a private residential Estate”, conrms that what the parties were concerned to preserve was the residential character of the development as a whole, and not merely the physical activity carried on inside any one unit. 80. I do not accept that this construction rewrites the parties’ bargain. The principle in National Bank of Kenya Limited v Pipeplastic Samkolit (K) Limited & another [2001] KECA 362 (KLR) is a real and important one, but it is directed against a court substituting terms the parties never agreed. It does not inhibit a court from giving the words the parties did agree their natural meaning. Nothing in this judgment reads into Clause 1.10 a prohibition on letting, on short-term letting or on the use of any particular platform; the platform is legally irrelevant, and I have said so. What the clause does contain, in terms, is a positive denition of the only use permitted. To hold that a use falls outside that denition is to apply the clause, not to rewrite it. The same answer disposes of the argument founded on Jiwaji: it is precisely because the words are clear that they must be given eect. 81. Nor do I accept the submission that the nding of breach rests on nothing more than counsel’s characterisation of the Airbnb business model. It is true, and I accept, that the Respondent led no evidence about how that platform operates, and that a nding of breach could not properly rest upon assertions from the bar as to the business model of a third party. It is also true that the burden of establishing a breach lay upon the party asserting it. But the Respondent did not need to prove the character of the use, because the Appellant proved it himself. It was his pleaded case that the suit premises were let as a furnished apartment on the Airbnb platform; that they enjoyed consistent bookings from a succession of guests; that the listing carried reviews and ratings; that negative reviews followed the damage; that bookings were cancelled; and that the listing was ultimately delisted. He gave evidence to that eect, produced the platform correspondence and the loss valuation report, and quantied his claim by reference to the income the operation had generated. Those facts are not in dispute; they are the foundation of the very claim he brings. On them, no evidence about Airbnb’s corporate business model was required. For the same reason I need not, and do not, rest anything on the invitation to take judicial notice of what Airbnb is, or on the regulatory framework under the Tourism Act, neither of which was explored in evidence below. 82. This construction accords with persuasive authority from other jurisdictions applying materially identical covenants. In Nemcova v Faireld Rents Limited [2016] UKUT 303 (LC) the Upper Tribunal (Lands Chamber) held that a covenant not to use a at other than as a private residence was breached by a series of short-term lettings, because the requisite degree of permanence was absent; whether the covenant is breached in any given case is a question of fact and degree. I nd that reasoning persuasive and consistent with the ordinary meaning of the words used in Clause 1.10. 83. On the evidence in this record, and in particular the Appellant’s own account of consistent short-term bookings, platform ratings, guest reviews and eventual delisting, the character and intensity of the use went well beyond occupation as a single private residence for one family. The trial court’s nding that the Appellant was in breach of Clause 1.10 was correct and I arm it. Ground 1 of the appeal fails. 84. Two qualications should be recorded. First, this nding rests on the character and intensity of the use established on this record, and is not to be read as a general proposition that every letting of a residential unit oends a covenant in these terms; the question will always be one of fact and degree. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 15

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Second, Clause 1.20, which concerns parting with possession and assignment, is a distinct covenant upon which the trial court made no nding and which does not arise for determination in this appeal. (iv) The two disallowed heads of loss 85. The trial court’s reasoning on the consequences of the Appellant’s breach was compressed, and it requires elaboration. A breach of covenant by a lessee does not, without more, extinguish the manager’s own contractual obligations or defeat every head of claim brought by the lessee. Indeed the trial court itself, correctly, awarded the repair costs notwithstanding the very same breach. The Respondent never served a notice under Clause 4.1, never sought forfeiture, and never counterclaimed. The Appellant’s breach of Clause 1.10 is therefore not a general defence to his suit, and to that extent I do not adopt the reasoning of the trial court. But it does not follow, as the Appellant’s submissions contend, that the disallowance of the two heads must fall away with it. The elements of a claim in damages for breach of contract are those identied in Dormakaba Limited v Architectural Supplies Kenya Limited [2021] KEHC 210 (KLR), and the third of them loss caused by the breach remains to be established in respect of each head separately. The correct analytical route lies in causation, remoteness, mitigation and proof, to which I now turn. Loss of short-term rental income Kshs. 730,000.00 86. This head fails on four independent grounds. 87. First, it is a claim for the value of an income stream which the Appellant could only have continued to generate by continuing to use the suit premises in breach of Clause 1.10 of the very contract upon which he sues. A court will not measure damages by the value of a benet which the claimant could have obtained only by persisting in his own breach of contract, for to do so would be to give indirect eect to a use which the parties had expressly agreed would not occur. The Appellant is entitled to be restored to the position he would have occupied had the Respondent performed; he is not entitled to be placed in the position he would have occupied had he himself continued in breach. That is an application of the principle, relied upon by the Respondent, that no man may rely upon his own wrong to defeat the otherwise valid claim of another: Mohamed v Bakari & 2 others (2005) 2 EA 213. 88. Second, the head is too remote. Under the rule in Hadley v Baxendale (1854) 9 Exch 341, damages for breach of contract are recoverable if they arise naturally from the breach or if they may reasonably be supposed to have been within the contemplation of both parties, at the time they made the contract, as the probable result of its breach. The Lease was executed on 31st May 2010 and assigned in 2012. A platform-based short-stay business was neither contemplated by that instrument nor permitted by it; Clause 1.10 excluded it. The Appellant’s submission that the Respondent was aware of, and did not object to, the letting arrangement for a considerable period before the leak is not borne out by the record. No evidence was led to establish such knowledge or acquiescence, whether by way of correspondence, minutes or the evidence of any witness, and DW1 testied that the management was not informed that the Appellant had let out the apartment. Losses of this character fall outside both limbs of the rule. 89. Third, the head was not proved to the standard the law requires. This is a claim in special damages, which must be specically pleaded and strictly proved as was stated in the cases of; Consolata Anyango Ouma v South Nyanza Sugar Company Limited [2015] eKLR; Coast Bus Service Limited v Sisco E. Murunga Ndanyi & 2 others, Civil Appeal No. 192 of 1992. The gure of Kshs. 730,000.00 was arrived at by the loss adjuster projecting an annual gure from historical receipts recorded between May 2019 and December 2021. No evidence was placed before the trial court of the specic bookings said to have been cancelled, of the period over which the loss was said to run, or of the net position after platform commissions, cleaning, utilities, furnishing replacement and management costs. Gross https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 16

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historical receipts are not a measure of lost prot. I add that the Respondent’s complaint that the maker of the loss valuation report was not called, and that its methodology and assumptions were therefore never tested, has force on this head. The report was produced without objection and I do not exclude it, but a projection which its author has not been called to explain cannot carry the weight of strict proof of a claim in special damages. 90. Fourth, causation of the delisting itself was not established. The communication from the platform dated 15th March 2022, produced as Plainti’s Exhibit 6, attributed the temporary deactivation of the listing to a reported transformer malfunction and required documentation from a technician conrming that the transformer had been repaired. A transformer is an electrical installation. The Appellant’s pleaded case, and the case he proved, concerned water seepage from ruptured tanks and leaking pipes. That evidential gap was never bridged at the trial. 91. The trial court was accordingly right to disallow this head, although I have reached that conclusion by a fuller route. Asset disposal loss Kshs. 303,105.00 92. This head stands a further step removed. It represents the dierence between the value the Appellant ascribed to his furniture and household appliances and the sums he in fact realised on selling them second-hand. 93. First, it is wholly consequential upon the delisting and the cessation of the short-stay operation, and therefore fails for the reasons already given. 94. Second, it fails independently on causation and mitigation. The decision to sell was the Appellant’s own commercial decision. Nothing compelled him to dispose of the furnishings; he could have retained them and let the unit as a furnished long-term rental, or stored them. The Respondent was not a party to the sales, was not consulted, and had no control over the prices realised. A claimant may recover the reasonable cost of reasonable steps taken in mitigation, but he may not recover a loss he has brought upon himself: See British Westinghouse Electric and Manufacturing Company Limited v Underground Electric Railways Company of London Limited [1912] AC 673. 95. Third, the head was not proved. Beyond the loss adjuster’s schedule and the bank statements and cheques evidencing the sums received, no evidence was placed before the trial court of the acquisition cost, age or condition of the items, or of any open market valuation of comparable second-hand furnishings against which the alleged shortfall could be measured. The sums realised were, as the Respondent correctly submits, the product of open market transactions between a willing seller and a willing buyer. 96. This head was also rightly disallowed. Ground 2 of the appeal accordingly fails. 97. One further submission requires a word. The Respondent invited the court to draw an inference adverse to the Appellant from a written instruction to his advocates that he wished to take the Respondent “to the cleaners”. I decline to do so. A litigant’s private expression of frustration with his opponent, however intemperate, is not evidence of the merits of his claim and is no part of the legal analysis. The two heads fail because they are irrecoverable in law and unproved on the evidence, not because of the spirit in which they were pursued. Equally, the fact that the Respondent is a noncommercial management company funded by the very homeowners of whom the Appellant is one is a matter of context rather than of law; it neither enlarges nor diminishes its contractual obligations, and the Appellant’s repair costs were and remain properly recoverable against it. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 17

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(v) Costs and consequential directions 98. Costs follow the event under section 27 of the Civil Procedure Act, subject always to the discretion of the court. Here both the appeal and the cross-appeal have failed. Each party has succeeded in resisting the other’s challenge and each has failed in its own. In those circumstances the just order is that each party bears its own costs of the appeal and of the cross-appeal. The award of costs made by the trial court is not disturbed. 99. There remains the deposit. By the ruling of 28th October 2025 the Respondent was required to deposit the decretal sum of Kshs. 253,640.00 into a joint interest-earning account in the names of the parties’ respective advocates, and by the ruling of 18th June 2026 that deposit was preserved as security for the judgment debt pending the nal disposition of the appeal and the cross-appeal. That disposition is now reached. The judgment of the trial court having been upheld, the purpose for which the deposit was held has been exhausted, and the sum, together with any interest it has earned, ought now to be released to the Appellant in satisfaction of the decretal sum. The stay of execution granted on 28th October 2025, being expressed to endure pending the hearing and determination of the appeal and cross-appeal, lapses upon delivery of this judgment, and the Appellant is at liberty to pursue the balance of his decree, namely interest and the costs awarded below, in the ordinary way. Disposition 100. For the reasons set out above, the nal orders of this court are as follows: i. The appeal dated 31st January 2025 is hereby dismissed. ii. The cross-appeal dated 5th November 2025 is hereby dismissed. iii. The judgment and decree of Hon. Pamela Achieng’ (CM) delivered on 23rd January 2025 in Milimani CMELC suit no. E311 of 2023 are hereby upheld in their entirety. iv. The sum of kshs. 253,640.00 held in the joint interest-earning account at I&M bank (CIF– 0805750) in the names of the parties’ respective advocates, together with all interest accrued thereon, shall be released to the appellant in satisfaction of the decretal sum within thirty (30) days of the date hereof. v. The stay of execution granted on 28th October 2025 lapses upon the delivery of this judgment, and the appellant is at liberty to execute for the balance of the decree in the ordinary way. vi. Each party shall bear its own costs of the appeal and of the cross-appeal. Vii. The costs awarded by the trial court remain undisturbed. DATED, SIGNED AND DELIVERED VIRTUALLY THIS 17TH DAY OF SEPTEMBER 2026. E. K. WABWOTO JUDGE In the presence of:Ms. Pyoko for the Appellant. Ms. Mathangani for the Respondent. Court Assistant; Joanne Omondi. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5448/eng@2026-09-17 18

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