Bakehouse Investments Limited v Bake N Bite (Nairobi) Limited [2016] KEHC 8621 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT NAIROBI

MILIMANI LAW COURTS

COMMERCIAL & TAX DIVISION

CIVIL SUIT NO.243 OF 2016

BAKEHOUSE INVESTMENTS LIMITED........................…PLAINTIFF

VERSUS

BAKE N BITE (NAIROBI) LIMITED…………….............DEFENDANT

RULING

[1] The Notice of Motion dated 24 June 2016 was filed by the Plaintiff/Applicant herein, Bakehouse Investments Limited, for Summary Judgment against the Defendants/Respondents in the principal  sum of Kshs. 27,267,520/= together with interest and costs, including the costs of the application. The application was predicated on the following grounds:

a) That the Defendants/Respondents are well and truly indebted to the Plaintiff/Applicant in the sum of Kshs. 27,267,520/= and were so indebted at the commencement of this suit.

b) That the Defendants/Respondents acknowledge being so indebted to the Plaintiff/Applicant.

c) That there is overwhelming and incontrovertible documentary evidence in support of the Plaintiff/Applicant’s claim, and therefore no defence can be sustained in the   face thereof.

d) That the Plaintiff/Applicant is financially prejudiced by the Defendants/Respondents'continued indebtedness to it.

[2]The Application was brought pursuant to Sections 1A, 3, 3A, 81(2)(f) of the Civil Procedure Act, Chapter 21, Laws of Kenya, and Order 36 Rules 1(2), (5) and 8 of the Civil Procedure Rules, 2010, and is supported by the Affidavit of the SAVAN SUNIL SHAHsworn on 24 June 2016 together with the annexures thereto. The grounds relied on by the Plaintiff/Applicant are that on or about the 26 October 2015, the 1st Defendant entered into a sixty days’ credit agreement with it for the supply of baking flour; and that it was a term of the contract that in default thereof, interest would accrue at the rate of 0. 125% per day on all overdue amounts from the due date until payment in full. It was further averred that the agreement was individually and personally guaranteed by the 2nd Defendant. A copy of the said agreement is marked as Annexure 1 to the Supporting Affidavit.

[3] It was further contended by the Plaintiff/Applicant that on or about the 29 January 2016, the 1st Defendant issued the Plaintiff with two purchase orders, marked Annexure 2, for the supply of baker's flour amounting to a total of Kshs. 33,700,000 which the Plaintiff honoured between 8 February 2016 and 7 March 2016,by supplying the products ordered for to the tune of Kshs. 27,216,000; but that as at 20 May 2016, the 1st Defendant had not settled any of the invoices raised in respect of the supplies and continued in their default in spite of various correspondence and reminders by way of electronic mail and notice of intention to sue.

[4] The Delivery Notes, Invoices and Statements of Account were exhibited as Annexure 3, while the emails and demand letter are marked Annexure 4 to the Supporting Affidavit. The Plaintiff thus pitched the argument that there cannot be any possible defence to the claim and hence the prayer for Summary Judgment.

[5]The application was initially urged by Counsel for the Plaintiff/Applicant on 8 July 2016 and a Ruling made on 15 July 2016 to the effect that the application was premature for the reason that the Defendants were yet to be served with Summons to Enter Appearance and Plaint, to enable them take a decision as to whether or not to defend the suit. The Court observed that an application for summary judgment pursuant to Order 36 Rule 1 of the Civil Procedure Rules can only be brought after a defendant has appeared. The Rule aforementioned further stipulates that such an application be made before the filing by a defendant of a Defence.

[6] Consequent to the Court's Ruling aforestated, the Plaintiff/Applicant caused service of Summons to Enter Appearance together with the Plaint to be effected on the Defendants as can be seen from the Affidavit of Service sworn by Walter Olando on 16 August 2016. It is manifest from the record that the Defendants have neither entered appearance nor filed a response to the instant application, which was served a second time on the Defendants pursuant to the Court order of 14 September 2016.

[7] The application for Summary Judgment is therefore entirely uncontroverted and the documents annexed to the Supporting Affidavit do confirm that the Defendants did issue the Plaintiff with two purchase orders for the supply of bakers flour worth Kshs. 33,700,000, which orders were honoured and the flour duly supplied by the Plaintiff. The Delivery Notes and Invoices attached to the Supporting Affidavit confirm the supply. At paragraph 8 of the Supporting Affidavit is a tabulation of the deliveries, the Delivery Note Numbers, the Invoices and the respective amounts due in terms of the principal sum as well as interest at the agreed rate of 0. 125% per month. In addition thereto, the email correspondence exchanged between the parties annexed  to the supporting Affidavit confirm the Defendant's indebtedness to the Plaintiff; and although some amounts were paid by the Defendant in reduction of the debt, a sum of Kshs. 27,267,520 was still  due and was outstanding as at 27 June 2016 when this suit was instituted.

[8]In the case of ICDC Vs DABER ENTERPRISES LIMITED [2000] I EA 75 the rationale for summary judgment was explained thus:

“The purpose of the proceedings in an application for Summary Judgment is to enable the Plaintiff to obtain a quick judgment where there is plainly no defence to the claims.”

I have no doubt that this is one such case.

In the premises, the Court is satisfied that the Notice of Motion dated 24 June 2016 is indeed meritorious. The same is hereby allowed with costs as prayed. Summary judgment is hereby entered in the Plaintiff's favour for the principal sum of Kshs. 27,267,520 together with interest and costs as prayed in paragraphs 1, 2 and 4 of the Plaint. Although the Plaintiff also prayed for general damages for breach of contract, this aspect of the case was not urged and therefore I would make no award in respect thereof.

Orders accordingly.

DATED, SIGNED and DELIVERED at NAIROBI this 26th day of OCTOBER, 2016

OLGA SEWE

JUDGE