Maya Enterprises Limited v Mulji Devraj & Brothers Ltd

the contract and/or agreement entered into was oral for transport services without interest. The Defendant stated that the Plaintiff’s rightful amount due and payable was Kshs. 8,841,055.16 and not the compounded interest of Kshs. 26,450,397.39. 5. The Defendant prayed that the Plaintiff’s claim for Kshs. 26,450,397.39 be dismissed with costs and that the Defendant be allowed to pay the admitted amount of Kshs. 8,841,055.16 by way of monthly instalments of Kshs. 500,000. 6. The Plaintiff in its Reply to Defence dated 4th September 2023 reiterated contents of their Plaint and rejected the Defendant’s proposal of liquidating Kshs. 8,841,055.16 by monthly instalments of Kshs. 500,000. 7. On 15th November 2023, a consent judgment was entered in favour of the Plaintiff against the Defendant for a principal sum of Kshs. 8,841,055.16. The court then gave directions that the pending issue being the assessment of interest proceed for hearing. 8. The Plaintiff, Jeje Shiv Vagh (PW1), the General Manager of the Plaintiff, adopted his statement dated 3rd July 2023 as his evidence in chief. He also stated that he had filed a bundle of documents which he produced as exhibits. On cross examination by Gakuo Advocate for the Defendant, PW1 stated that the agreement to pay interest was indicated in the invoice and that they prepared the statement of accounts. He said that he was not an accountant but a Civil Engineer and that his responsibility included approving accounts prepared by the accounts office which had qualified accountants. 9. He said that the invoice on page 34 No. 048 was signed by him and the accountant but it did not bear his name. That on page 35 No. 078, there was no name and that ‘prepared by’ was the name of the person who made or prepared the invoice. That on page 36, there was a name but it was not legible. That on page 37 and 38, the names were not visible. He said that there was a signature on the document but he did not write his name. That on page 65, the name was not indicated but the invoices were genuine. He said that the statement of accounts was not audited. That on page 29, the same was signed by Zainab though the account was not audited. That the worksheet was prepared by Zainab but she did not sign it. 10. PW1 in re-examination said that the worksheet on page 94 and 95 show vehicle number and ofioading details. That it was indicated that Maya Enterprises was the maker. That the statement of account as shown came from Maya Enterprises and the documents were made by the accountant. PW1 said he did the checking for approval and that the Defendants did not ask for auditing of accounts. That there was no report contradicting the figures and that the statement of accounts arose from the invoices. 11. PW1 informed court that the Defendants did not ask for his qualification and that he only checked the prices and approved the accounts. He said that he approved all the invoices which were received and signed, that there was no objection to the invoice and that no questions were raised. The Plaintiff then closed their case. The Defendant closed its case without calling any evidence. 12. The parties were directed to file their submissions. Both parties complied by filing their rival submissions. 13. In its submissions dated 9th May 2024, the Plaintiff submitted that they were only required to prove the existence of the debt and consequent interest on a balance of probability, which they did. Reliance was placed on the case of Shaneebal Limited v County Government of Machakos (2018) eKLR. 14. On the claim for interest on the principal sum, the Plaintiff submitted that the sought interest is at the rate of 2% compounded monthly from January 2018. That the invoices started attracting interest after 60 days. The Plaintiff relied on the case of Mobile Telephone Networks Business Kenya Limited https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/4374/eng@2026-02-19 2

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v Iphone Global Limited (2018) eKLR and Texplast Industries Limited v Chemlil Sugar Company Limited (2016) eKLR. The Plaintiff also prayed for costs. 15. The Defendants in their submissions dated 10th June 2025 argued that there was never an agreement between the parties on the payment of interest on delayed invoices. That the Plaintiff has sought to rely on a footnote on post contractual invoices to introduce a 2% monthly interest clause. That the clause is unilateral, was never discussed, negotiated or accepted by the Defendant and does not therefore form part of the binding Transport contract. 16. The Defendant cited decisions in Kenya Breweries Ltd v Kiambu General Transport Agency Ltd, Toyota Kenya Limited v Vehicle & Equipment Leasing Limited (2020) eKLR and County Government of Migori v Hope Self Help Group (2020) eKLR. The Defendant submitted that where interest terms are not expressly agreed upon at the formation of a contract, they cannot be enforced unilaterally. 17. That the court can only rely on a contract as basis for paying interest but in the case herein, the transport contract did not have an agreement on payment of interest. That the Plaintiff’s reliance on a unilateral clause inserted post-facto without the knowledge or consent of the Defendant offends the foundational principle of contract law. Analysis 18. 19. This court has considered the pleadings, evidence on record and submissions. The issues for determination are: a. Whether the Plaintiff is entitled to recover the interest at the rate of 2% per month amounting to Kshs. 26,450,397.39 as at February 2023 on accounts outstanding for more than 60 days b. What orders on costs should issue Parties are bound by contractual terms mutually agreed upon and courts cannot rewrite contracts for parties. In the case of National Bank of Kenya Ltd v Pipeplastic Samkolit (K) Ltd & another [2001] KECA 362 (KLR) it was held as follows: “ A Court of law cannot re-write a contract between the parties. The parties are bound by the terms of their contract, unless coercion, fraud or undue influence are pleaded and proved.” 20. It is not in dispute that the agreement between the parties was oral. However, there is no evidence that the interest rate of 2% per month was discussed at the time of forming the contract, negotiated between the parties, reduced into writing accepted or established as a consistent trade usage known to both parties. 21. According to the Defendant, the Plaintiff sought to rely on a footnote on post contractual invoices to introduce a 2% monthly interest clause. The mere appearance of a footnote in invoices does not automatically incorporate the term into the contract. In Shaneebal Limited v County Government of Machakos [2018] KEHC 5921 (KLR) it was stated as follows; “ It follows that without any contractual justification for an award of interests at commercial rate, such interests are not awardable as it is not proved that the same was not in the contemplation of the parties when the contract was being entered into.” https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/4374/eng@2026-02-19 3

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22. Further, the court in Toyota Kenya Limited v Vehicle & Equipment Leasing Limited [2021] KEHC 12871 (KLR) had the following to say: “ By presenting an invoice with fresh terms as to time of payment and interest on late payment, the Plaintiff was in effect making a fresh offer. In order for it to be effective, there had to be a meeting of minds which is an essential component for the formation of an enforceable contract. In addition, the variation ought to have been supported by fresh consideration.” 23. In the circumstances, the claim for payment of interest at 2% compounded monthly and translating to Kshs. 26,450,397.39 is dismissed. Nevertheless, the Defendant withheld money due and owing to the Plaintiff for the services rendered. The Defendant admitted that Principal amount. There is no reason advanced as to why he failed to honour his part of the agreement leading to the filing of this suit. On this account, the Plaintiff is entitled to the interest on the principal amount at court rates, that is 14% per annum from date of filing suit until payment in full. 24. On costs, considering that the claim is partially settled, each party is to bear their own costs of the suit. Determination 25. In the upshot, this court makes the following orders; a. Interest awarded on the principal amount of Kshs. 8,841,055.16 at an interest rate of 14% per annum, from date of filing suit until payment in full. b. Each party to bear its own costs. It is so ordered. DATED, SIGNED AND DELIVERED VIRTUALLY AT MOMBASA THIS 19TH DAY OF FEBRUARY, 2026 ……………………….. HON. F. WANGARI JUDGE OF THE HIGH COURT In the presence of: Mr. Mokaya Advocate for the Plaintiff Ms. Ambutsi Advocate for the Defendant Ms. Salwa, Court Assistant https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/4374/eng@2026-02-19 4

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