The Republic of Kenya v Mogo Auto Limited & 1 other

financial hardship due to exchange rate fluctuations. He further states that despite making payments through M-Pesa, the outstanding balance has varied significantly. The Applicant contends that the Respondent has failed to comply with a directive by the Competition Authority of Kenya requiring regularization of such facilities. He also avers that the Respondent has issued a notice dated 29th July, 2025, and commenced recovery proceedings, including the intended sale of his motor vehicle, which he asserts is based on an inaccurate outstanding amount. 3. The Respondent opposed the application through Grounds of Opposition and a Replying Affidavit sworn by its Debt Collection Legal Officer, David Irungu Kimani. It is contended that the application is incompetent for having been brought by way of a miscellaneous application without being anchored in any plaint or other originating process, and in contravention of Order 40, rules 1 and 2 of the Civil Procedure Rules which makes it compulsory for the existence of a suit to support the grant of interim injunctions. 4. The Respondent maintains that the parties entered into a USD-denominated loan agreement, which the Applicant voluntarily accepted, being aware of the attendant risks, including exchange rate fluctuations. It is further deponed that the Applicant subsequently obtained a top-up facility, thereby increasing the loan amount and corresponding instalments. HCCOMMISC NO. E818 OF 2025 Page 2

page 2 of 12

5. The Respondent avers that the Applicant has been in persistent default, having made irregular and insufficient payments. As at 30th September, 2025, the payments made were inadequate to settle the outstanding loan together with interest, penalties, and charges. The Respondent attributes the increased balance to the Applicant’s defaults rather than currency fluctuations. It denies that the Applicant requested conversion of the loan into Kenya Shillings and asserts that the directive by the Competition Authority of Kenya does not apply generally to all loan facilities. 6. The Respondent further states that it duly perfected its security over motor vehicle registration number KCB 943N and is entitled to realize the same upon default. It contends that the Applicant will not suffer irreparable harm if the orders sought are denied and urges the Court to uphold the sanctity of contract, arguing that the Court cannot rewrite the parties’ agreement. Accordingly, it prays that the application be dismissed with costs. 7. The application be canvassed by way of written submissions, which were duly filed by both parties. Applicant’s Submissions 8. The Applicant filed written submissions dated 5 th March, 2026, in which he outlines the background of the application and identifies four issues for determination, namely: whether the application is properly before HCCOMMISC NO. E818 OF 2025 the Court; whether the Page 3

page 3 of 12

Respondent’s conduct contravenes the directive of the Competition Authority of Kenya (CAK) and violates the Applicant’s legitimate expectations; whether the Applicant has established grounds for judicial enforcement of the CAK Directive against the Respondent and whether the balance of convenience and irreparable harm tilt in favour of the Applicant. 9. On the first issue, the Applicant submits that the Respondent’s objection to the form of the proceedings is misconceived. He argues that the filing of the application as a miscellaneous cause does not render it incompetent and relies on the decisions in Microsoft Corporation v Mitsumi Computer Garage Ltd Procurement [2001] eKLR Administrative and Republic Review Board v Public ex parte Selex Sistemi Integrati [2008] eKLR. He further invokes Article 159(2)(d) of the Constitution, urging the Court to administer justice without undue regard to procedural technicalities and to find that the application is properly before it. 10. On whether the Respondent’s conduct contravenes the CAK directive, the Applicant submits that the insistence on repayment in United States Dollars, despite disbursement in Kenya Shillings, is inconsistent with the said directive requiring regularization of loan facilities into Kenya Shillings. He contends that the directive is binding unless set aside and that the Respondent has not challenged it. Reliance is placed HCCOMMISC NO. E818 OF 2025 Page 4

page 4 of 12

on Keroche Industries Ltd v Kenya Revenue Authority [2007] KLR 240 and Communications Commission of Kenya & 5 Others v Royal Media Services Ltd & 5 Others [2014] eKLR in support of the doctrines of legality and legitimate expectation. 11. The Applicant further submits that the present application seeks judicial intervention to enforce compliance with a binding administrative directive issued pursuant to the statutory mandate of the Competition Authority of Kenya, rather than the grant of an ordinary interlocutory injunction. 12. On irreparable harm and the balance of convenience, the Applicant contends that continued repayment in United States Dollars exposes him to escalating obligations due to exchange rate fluctuations and places him at risk of losing the motor vehicle offered as security. Relying on Nguruman Limited v Jan Bonde Nielsen & 2 Others [2014] eKLR, he submits that damages would not be an adequate remedy. He maintains that the Respondent would suffer no prejudice if compelled to comply with the Competition Authority of Kenya directive and urges the Court to grant the orders sought. Respondent’s Submissions 13. The Respondent, in its written submissions dated 28 th April, 2026, identifies a single issue for determination, namely, whether the orders sought are capable of being granted in a suit that commenced by way of a Notice of Motion. HCCOMMISC NO. E818 OF 2025 Page 5

page 5 of 12

14. It submits that the application is fundamentally incompetent for want of a proper originating process, in contravention of Section 19 of the Civil Procedure Act and Order 3, rule 1 of the Civil Procedure Rules. Reliance is placed on Joseph Kibowen Chemior v William C Kisera [2013] eKLR, Samuel Chege Thiari & Another v Eddah Wanjiru Wangari & 3 Others [2018] eKLR, and Kalyonge v Karanja [2022] KEHC 16174 (KLR), to support the contention that substantive rights cannot be determined through a miscellaneous application. 15. The Respondent further submits that the orders sought are in the nature of mandatory orders aimed at altering the parties’ contractual relationship. It argues that the Applicant freely entered into the Loan Agreement, the Security Agreement, and the subsequent Amendment Agreement, without coercion, fraud, or undue influence and is therefore bound by their terms. In this regard, it relies on National Bank of Kenya Limited v Pipeplastic Samkolit (K) Ltd & Another [2001] eKLR for the principle that courts cannot rewrite contracts for parties and that parties are bound by the terms of agreements. 16. On the threshold for mandatory injunctions, the Respondent submits that such reliefs are granted sparingly and only in clear cases. Citing Locabail International Finance Ltd v Agro Export & Another [1986], as cited with approval in Kenya Breweries Ltd & Another v Washington O. Okeyo HCCOMMISC NO. E818 OF 2025 Page 6

page 6 of 12

[2002] eKLR, it argues that the Applicant has not met the required high standard, particularly in light of the contested factual and contractual issues which can only be resolved at a full hearing. 17. The Respondent further contends that the Court lacks jurisdiction to grant the substantive reliefs sought in the absence of a properly instituted suit. It maintains that the issues raised relate to contractual rights and obligations, which cannot be determined summarily through an interlocutory application. 18. In conclusion, the Respondent urges the Court to decline the invitation to determine substantive contractual disputes in the absence of a substantive suit and prays that the application be dismissed with costs. Analysis and Determination 19. I have carefully considered the application, the Respondent’s Grounds of Opposition, the affidavits on record, and the parties’ respective submissions. In my view, the issues that arise for determination are:a) Whether the present miscellaneous application is competently before the Court; and b) Whether the Applicant has established a basis for this Court to compel the Respondent to regularize the loan account in Kenya Shillings and to recalculate the loan HCCOMMISC NO. E818 OF 2025 Page 7

page 7 of 12

repayments in accordance with the directive of the Application is Competition Authority of Kenya (CAK). Whether the present Miscellaneous competently before the Court 20. The Respondent challenges the competence of the present proceedings on the ground that the Applicant has approached the Court by way of a Notice of Motion filed as a miscellaneous application, while seeking substantive reliefs capable of finally determining obligations under the loan the parties’ agreement. The rights and Applicant, conversely, maintains that the application merely seeks enforcement of a directive issued by the Competition Authority of Kenya, and that any procedural deficiency ought to be cured under Article 159(2)(d) of the Constitution. 21. The applicable legal framework governing the institution of civil proceedings is not in dispute. Section 19 of the Civil Procedure Act provides that every suit shall be instituted in the manner prescribed, while Order 3, rule 1 of the Civil Procedure Rules requires that every suit be commenced by way of a plaint or such other prescribed process. These provisions are couched in mandatory terms and underscore the centrality of proper procedure in the administration of justice. HCCOMMISC NO. E818 OF 2025 Page 8

page 8 of 12

22. The jurisprudence on this issue is well settled. Courts have consistently held that a miscellaneous application is limited in scope and is generally reserved for instances where no substantive rights are to be determined. As was aptly stated in Joseph Kibowen Chemior v William C Kisera [2013] eKLR, such applications are appropriate only where the Court is invited to exercise discretion or grant incidental or procedural orders, and not where it is called upon to adjudicate on contested rights. Similarly, in Samuel Chege Thiari & Another v Eddah Wanjiru Wangari & 3 Others [2018] eKLR, the Court emphasized that failure to initiate proceedings through proper pleadings renders the process incompetent and incapable of being salvaged by Article 159 of the Constitution. 23. I am persuaded by the foregoing authorities and adopt the principle that where a dispute calls for the determination of substantive rights and obligations, it must be commenced through a recognized mode of instituting a suit. A miscellaneous application cannot be used as a substitute for a substantive cause of action. 24. Turning to the present application, it is evident that the Applicant seeks far-reaching reliefs. In particular, prayers (c) and (d) of the Application, seek orders compelling the Respondent to convert the loan into Kenya Shillings, recalculate all payments made since 22 nd December, 2023, HCCOMMISC NO. E818 OF 2025 Page 9

page 9 of 12

credit alleged excess payments towards the principal sum, and refund any overpayments. These reliefs are not merely incidental or preservatory. Rather, they are substantive in nature and, if granted, would fundamentally alter the parties’ contractual relationship and conclusively determine their respective rights and obligations under the Asset Financing Loan Agreement and the subsequent Amendment Agreement. 25. Moreover, the dispute raises complex and contested issues, including the proper interpretation and enforceability of the loan agreements, the effect and applicability of the Competition Authority of Kenya directive, the accuracy of the loan account, and the legality of the Respondent’s recovery measures. Such issues require a full evidentiary hearing and cannot properly be resolved within the limited framework of a miscellaneous application commenced by way of a Notice of Motion. 26. I therefore agree with the Respondent that the reliefs sought herein can only be adjudicated upon in a properly instituted suit. Such a process would allow the parties to file pleadings, present evidence, and fully ventilate their respective cases in accordance with the rules of natural justice. 27. While the Applicant has invited this Court to invoke Article 159(2)(d) of the Constitution, it is now settled that the said provision was not intended to cure fundamental defects or to HCCOMMISC NO. E818 OF 2025 Page 10

page 10 of 12

dispense with mandatory procedural requirements. The defect in the present matter is not a mere technical lapse; it goes to the very root of the proceedings. In the absence of a competent suit, there exists no proper legal foundation upon which the substantive reliefs sought can be granted. 28. Having reached that conclusion, it would be inappropriate for this Court to delve into the merits of the dispute, including the effect of the CAK directive, the parties’ contractual obligations, or the alleged default. Any determination on those issues would be premature and may prejudice the parties should the dispute be subsequently presented before a Court through the proper procedure. 29. In the circumstances, I find that the Notice of Motion dated 1 st August, 2025, is incompetent and improperly before the Court. The same is hereby struck out with costs to the Respondent. 30. Orders accordingly. Delivered, Dated and Signed virtually this 18th day of June, 2026 RHODA RUTTO JUDGE In the presence of; HCCOMMISC NO. E818 OF 2025 Page 11

page 11 of 12

Court Assistant: Wabwire Mr. Maingi holding brief for Mr. Okoth for the Respondent Sharon Chemutai holding brief for Kerika Leina for the Applicant HCCOMMISC NO. E818 OF 2025 Page 12

page 12 of 12