Interconsumer Products Limited v Elijah Kariuki Mugeriki & 1 other

4. The appeal was canvassed by way of written submissions which I have considered. The Respondents did not participate in the appeal despite proper service with the pleadings and this appeal therefore proceeded as undefended. Appellant’s Submissions. 5. The Appellant submitted that under Section 27(1) of the Civil Procedure Act, the general rule is that costs follow the event, which means that the successful party is entitled to costs unless the court, for good reason, orders otherwise. It was the Appellant’s case that the trial magistrate did not give any reason for denying it costs. Reference was made to the decision in Joseph Oduor Anode vs. Kenya Red Cross Society [2012] eKLR, where Odunga J. (as he then was) held that: “ The discretion of the court to award or deny costs must be exercised judicially, not whimsically. If the court decides to deny costs to the successful litigant, it must give good reasons for doing so.” 6. On the question of interest, the Appellant relied on the provisions of Section 26(1) of the Civil Procedure Act and the case of Michael S. Odongo vs. South Nyanza Sugar Co. Ltd [2019] eKLR, where the Court of Appeal held that: “ In liquidated claims, interest is ordinarily awarded from the date of filing suit unless the court, for good reason, orders otherwise.” 7. It was therefore the Appellant’s case that the learned magistrate’s award of interest from the date of judgment was a misdirection in law. Issues for Determination 8. Having considered the Record of Appeal and the Appellant’s submissions, I find that the following issues arise for determination: i. Whether the learned magistrate erred in law in directing that each party bears its own costs. ii. Whether the learned magistrate erred in awarding interest from the date of judgment instead of from the date of filing suit. Analysis and Determination Costs 9. Section 27(1) of the Civil Procedure Act provides that costs are at the discretion of the court, but that costs shall follow the event unless the court for good reason otherwise orders. 10. The import of the above provision was clarified in Jasbir Singh Rai & 3 Others vs. Tarlochan Singh Rai & 4 Others [2014] eKLR, where the Supreme Court stated: “ The award of costs is a matter of judicial discretion, but such discretion must be exercised upon settled principles and not capriciously. The general rule remains that costs follow the event.” https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/19402/eng@2025-11-20 2

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11. In the instant case, the trial court found in favour of the Appellants but directed that each party bear its own costs without assigning any reason for that departure. I find that the absence of any justification contravenes the requirement that discretion must be exercised judicially and with reasons recorded. 12. I therefore find that the learned magistrate erred in law by failing to provide reasons for denying costs to the successful party, thereby rendering that part of the judgment unsustainable. 13. Accordingly, I find that the Appellant, as the successful party in this appeal, is entitled to costs both in the lower court and in this appeal. Interest 14. Section 26(1) of the Civil Procedure Act gives the court discretion to determine the rate and period of interest but also provides that interest on a decree for payment of money may run from the date of filing suit to the date of decree and thereafter at such further rate as the court deems fit. 15. In Prem Lata vs. Peter Musa Mbiyu [1965] EA 592, the Court of Appeal stated that: “ The general principle is that where a party has been deprived of the use of money that is rightfully theirs, interest should be awarded from the date of filing suit unless there are reasons to order otherwise.” 16. Similarly, in Michael S. Odongo vs. South Nyanza Sugar Co. Ltd (supra), the appellate court emphasized that interest in liquidated claims should ordinarily run from the date of filing unless the court expressly provides reasons to deviate from that principle. 17. In the present case, the record shows that the trial court awarded interest from the date of judgment without giving any explanation for doing so. In the absence of reasons, this Court finds that the trial court misapprehended the applicable principles under Section 26(1). Conclusion 18. Having considered the record, the submissions, and the applicable law, I find merit in the appeal. The judgment of the lower court on the issues of costs and interest is hereby set aside and substituted with the following orders: 1. The Appellant shall be entitled to costs of the suit in the lower court, in accordance with Section 27(1) of the Civil Procedure Act. 2. Interest shall be computed from the date of filing suit until payment in full, in accordance with Section 26(1) of the Civil Procedure Act. 3. The Appellant shall also have the costs of this appeal. DATED, SIGNED AND DELIVERED AT NAIROBI THIS 20TH DAY OF NOVEMBER, 2025. HON. W. A. OKWANY JUDGE 20/11/2025 For Appellant ……………. For The Respondent ………… Court Assistant Ubah https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/19402/eng@2025-11-20 3

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