Commercial Bank Ltd v Kaniki Karisa Kaniki [2004] KEHC 2563 (KLR)

REPUBLIC OF KENYA IN THE HIGH COURT OF KENYA AT MILIMANI COMMERCIAL COURTS CIVIL CASE NO. 359 OF 2000

COMMERCIAL BANK LIMITED…………………………PLAINTIFF

VERSUS

KANIKI KARISA KANIKI…….………………………….DEFENDANT

RULING

This Court on 28th January, 2004 entered judgment against the Defendant as prayed in the Plaint in this suit after hearing the case. The suit came for trial on 20. 01. 04 but neither the Defendant nor his Counsel on record appeared or attended Court. The hearing proceeded in their absence since the date was taken by consent of the parties through their advocates and no reasons were forwarded to the court for their non-attendance. The Defendant called one witness and upon hearing judgment was entered against the Defendant in the sum of Kshs 6,070. 398. 96 together with interest thereon at the rate of 30% p.a. with effect from 31st December, 1999. Costs was also awarded to the Plaintiff.

The Defendant has subsequently filed this application with a view of setting aside my aforesaid Judgment. The application is made under the provisions of Rules 3(1)(2) of the Judicature Act, Order XXI, Rule 22(1)(2) of the Judicature Act, Order XXI, Rule 22(1), and Order IXB Rule 8 of the Civil Procedure Rules. He says that his former advocates on record M/S Mulwa & Mulwa Advocates did inform him of the hearing date but he could not attend the hearing because he was unwell.

Counsel who was handling the matter at Mulwa & Mulwa Advocates, Mr. Isaac Terer also swore an affidavit in support of this application. The said Advocates, says that he was personally handling this suit on behalf of the Applicant and that he did inform the Applicant of the hearing date on telephone.

On his part, he said that his files which had hearing dates fixed and other files were mixed up during some office restructuring works which took place in December, 2003. Also that after the vacation, he did not return to the said firm of Mulwa & Mulwa Advocates since he resigned and left the firm to take over the business of another law firm. Further that due to inadvertent mistake on his part, he did not enter the hearing date in his diary. I have considered the application the affidavits and the submissions by Counsel. First the personal attendance of the Applicant was necessary at the hearing as the full trial was due. He was duly informed of the hearing set for 20th January, 2004. He claims that he could not travel to Nairobi from Malindi as he fell ill on 19th January, 2004 and had to attend medical clinic for treatment.

That he was advised to go back to the clinic on 20th January, 2004 for further treatment. He says that he continued with treatment and had to send his relative one Sulubu Ngala to Nairobi on 2. 3.2004 to find out what happened on 20. 1.2004. I am very skeptical about the explanation given by the Applicant for his absence and non – attendance of the court hearing. He does not state why he could not telephone his advocates in Nairobi to tell them of his illness on 19th January, 2004 or even on 20th January 2004. He was not bed ridden or an in-patient and must have gone physically to the clinic on 19th and 20th January, 2004. There is nothing which could have stopped him from making a telephone call. If he was too sick to make a call, surely his family, or relatives or friends were able to make the call on his behalf.

This court notes that both Advocate and client did not attend court on the hearing date. Coincidences and coincidental misfortunes do take place and the court has no problem with this. However, again, the reasons and explanations given by counsel for his non-attendance does not make any sense to me. He says he did not enter the hearing date in his diary. Then in the course of the December vacation, he proceeded up-country but instructed some carpenters to carry out some office restructuring which involved movement of all files from one office to another and that in the process, the files which had dates and others were mixed up. That he did not return to the firm of Mulwa and Mulwa, Advocates after the vacation as he took over the business of another firm whose proprietor had been appointed to the Bench.

He continues to state that he resigned from the said firm and hurriedly handed over all files he was dealing with. The Counsel described these events and the result as an inadvertent mistake on his part. With due respect, this was not and could not be a case of an inadvertent mistake or error. If the said facts were true then they are indicative of negligence on counsel’s part. It has bee stated in some cases that the acts or omission of an advocate ought not be visited upon the client. This is not a general statement of law but has been applied in some cases within the peculiar circumstances of each respective case.

The circumstances of this case is quite unique. Here the hearing proceeded and judgment delivered in favour of the Plaintiff for 3 reasons:-

1. Non-attendance of the Defendant’s Advocates when the hearing dates had been taken by consent.

2. Non-attendance of the Defendant when he had been duly notified of the hearing date by his Advocate.

3. Upon the court hearing the case ex parte but on the merits of the Plaintiff’s case and the record including the Defendant‘s defence.

It was not a default judgment but one upon a hearing but in the absence of the Defendant and his counsel. The absence of Counsel was clearly due to negligence and that of the Defendant due to reasons of alleged ill-health. I say alleged because I do not entirely believe that the Defendant was so incapacitated that he could not have communicated with his Advocates in Nairobi to alert them of his inability to travel or to send a representative from Malindi to come to Nairobi to explain his absence. This would have at the very least precluded the hearing for proceeding. The omission reveals an expensive error of judgment on his part. What is the resultant situation now? We have a Plaintiff who has patiently and diligently prosecuted his suit and now has judgment in his favour. The judgment is for a substantial amount and it vests some proprietary interest in the Plaintiff.

It is on the seat of a lawful and regular judgment. On the other hand, we have a Defendant who is faced with the execution of a decree for a huge sum and who seeks the equitable discretion of this court to indulge him and set aside the judgment. His application is weak and explanations given not quite convincing.

The main concern of the court is to do justice to the parties. In the case of PHILIP CHEMWOLO & ANOTHER V AUGUSTINE KUBENDE ( 1982 – 88) 1 KAR 1036, Apaloo, J.A (as he then was) enunciated the broad equitable approach in these sort of cases as follows:-

“I think a distinguished equity Judge has said:- “Blunders will continue to be made from time to time and it does not follow that because a mistake has been made a party should suffer the penalty of not having his case heard on merits. I think the broad equity approach to this matter, is that unless there is fraud or intention to overreach, there is no error or default that cannot be put right by payment of costs. The court as is often said, exists for the purpose of deciding the right of the parties and not for the purpose of imposing discipline.”

With regard to the exercise of the court’s discretion, the discretion is intended to avoid injustice or hardship resulting from accident inadvertence, or excusable mistake or error, but is not designed to assist a person who has deliberately sought, whether by evasion or otherwise, to obstruct or delay the course of justice – SeeSHAH – V – MBOGO (1967) EA116. In exercising the discretion the court should consider among other things, the facts and circumstances both prior and subsequent, and all the respective merits of the parties. The question as to whether the affected party can reasonably be compensated by costs for any delay occasioned by setting aside of the judgment should be considered and should always be remembered that to deny a person a hearing should be the last resort of the court.

I have considered the particular circumstances of this case, the Applicant’s affidavits in support of the application, the judgment that I delivered and the pleadings. There may be no intention by the Applicant to defraud or overreach, but there is clear evidence that the Applicant did not give the defence of this suit the attention and seriousness it deserved. He has made possible a situation where the plaintiff has altered its position and been put to expense and there is definite delay in the conclusion of this suit. Be that as it may, this is a Court of equity and I am of the view that the court ought to exercise its discretion in setting aside its judgment delivered on 28th January, 2004 upon terms as provided for in order IXB, Rule 8 of the Civil Procedure Rules.

I do not think that payment of thrown away costs alone would compensate the plaintiff –decree-holder. I think and I am inclined to order the deposit of a reasonable sum by the Defendant considering the Decretal sum so as there is a commitment by the Defendant in the expeditious disposal of the suit and also to justify the removal of the Plaintiff from its seat of judgment and enjoyment of the fruits of the said judgment. In making this order I have taken into account the Defendant’s demeanour referred to hereinabove.

In exercise of the Court’s discretion I do hereby set aside the Court’s Judgment dated 28th January, 2004 and all consequential orders upon the following terms:-

1. That the Defendant deposits with the Plaintiff Bank a sum of Kshs. 1,000,000/= ( one Million shillings) within the 45 DAYS from the date hereof.

2. The said amount shall be deposited in a FIXED DEPOSIT AMOUNT OR ESCROW ACCOUNT earning the appropriate bank interest for such accounts and shall be held jointly in the name of the DEPUTY REGISTRAR OF THE HIGH COURT the Plaintiff’s Counsel and the Defendants’ Counsel.

3. The Defendant shall pay all the Plaintiff’s thrown away costs incurred from 20th January, 2004 to date including the costs of this application. To avoid delay in the trial, such agreed or taxed costs shall be paid upon determination of this suit.

4. The hearing of this suit be fixed on priority basis and the matter be disposed of within a maximum period of 5 months from the date hereof having taken into account the period for payment of the deposit in (1) above, the end year and coming December Vacations.

5. In default of the Defendant depositing the sum of Kshs 1000,000/= as ordered in (1) above, this order shall stand vacated and discharged and the judgment dated 28th January, 2004 shall be automatically become reinstated and in force. In such event the Plaintiff shall be at liberty to execute the judgment and consequential Decree against Defendant. In such event the Deposit shall be applied in part satisfaction of the decretal sum.

6. In the event, the Defendant deposits the amount of Kshs 1000,000/= in compliance with (1) above, the said amount together with all accrued interest shall be released to the successful party OR as the trial court shall direct in its judgment.

Orders accordingly

Dated and delivered on 3rd November, 2004 at Nairobi.

M.K. IBRAHIM

JUDGE