First National Finance Bank Limited v Universal Apparels (EPZ) Ltd,Rubina Ahmed & Ahmed Aftab [2017] KEHC 10060 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT NAIROBI

COMMERCIAL AND TAX DIVISION

CIVIL SUIT NO. 2496 OF 1997

FIRST NATIONAL FINANCE BANK LIMITED.............PLAINTIFF

- VERSUS -

UNIVERSAL APPARELS (EPZ) LTD................1ST DEFENDANT

RUBINA AHMED................................................2ND DEFENDANT

AHMED AFTAB..................................................3RD DEFENDANT

RULING

1. By an application dated 24th March 2017 the plaintiff has asked the court to set aside the Ruling delivered by Hon. Claire Wanyama, on 13th March 2017.

2. The plaintiff asks that after the Ruling is set aside, the matter should be referred to another Deputy Registrar, for the purposes of taking of Accounts.

3. When the defendants were served with the application, they filed a Notice of Preliminary Objection dated 17th May 2017.

4. However, the parties later agreed that the said Notice of Preliminary Objection could form part of the defendants answer to the application.

5. It is common ground that the following are the issues that arise for determination;

a) Is the plaintiff’s application properly before the courts?

b) In the light of the plaintiff’s conduct during and prior to the Accounts taking, is it entitled to the Orders sought?

c) Is the substance of the application merited?

6. The plaintiff invoked Article 159 of the Constitution of the Republic of Kenya and Section 3A of the Civil Procedure Act, as the foundation for its application.

7. In the opinion of the defendants, Article 159 of the Constitution is not a panacea for deliberate irregularities.  The defendants relied upon the decision of Aburili J. in JOSEPHAT MUCHIRI MUIRURI & ANOTHER Vs. YUSUF ABDI ADAN, CIVIL APPEAL No. 715 of 2006, to back the arguments.  In that case, the learned Judge quoted with approval, the following words from the case of KAKUTA MAIMAI HAMISI Vs. PERIS PESI TOBIKO & 2 OTHERS [2013] eKLR;

“…the right of appeal goes to jurisdiction and is so fundamental that we are unprepared to hold that absence of statutory donation or conferment is a mere procedural technicality to be ignored by parties or a court by pitching tent at Article 159 (2) (d) of the Constitution.  We do not consider Article 159 (2) (d) of the Constitution to be a panacea, nay, a general white-wash that cures and mends all ills, misdeeds and default of litigation”.

8. I am in full agreement with that pronouncement.

9. Where the statute or the applicable rules stipulate a procedure to be followed, parties ought to comply.  It is only when rules are followed that there is orderliness in the manner in which proceedings are handled.  If the courts were to totally disregard the rules of procedure, the result is likely to be total anarchy.

10. Nonetheless, Article 159 (2) (d) of the Constitution makes it clear that when called upon to administer Justice, the courts or any other tribunals which exercise judicial authority, shall not be blindly enslaved by procedural technicalities.

11. The Constitution does not urge the courts to disregard procedural rules.  It only says that the courts should not have undue regard to procedural technicalities.

12. Ordinarily therefore, Article 159 (2) (d) of the Constitution ought to be a shield, rather than a spear.  It ought to be invoked to protect a substantive application so that the application can be heard, rather than having the application struck out or dismissed on the basis of a technicality.

13. Article 159 (2) (d) should not, ordinarily, be the foundation upon which an application is founded, when the law provides means through which the applicant can move the court.

14. I now move on to consider the provisions of Section 3A of the Civil Procedure Act.

15. First, the defendants did not make any submissions on that account.  But in any event, I find that the Court of Appeal gave very useful remarks in the case of KENYA POWER & LIGHTING COMPANY LIMITED Vs. BENZENE HOLDINGS LIMITED T/A WYCO PAINTS, CIVIL APPEAL No. 132 of 2014.  This is what the court said;

“Section 3A of the Civil Procedure Act appears to have been introduced to augment the provisions of Section 3, vesting in the courts inherent power to make any orders as may be necessary for the ends of justice or to prevent abuse of the process of the court.  Of course this power has now been broadened by the introduction in 2009 of Overriding Objective in sections 1A and 1B and 2010 by Article 159 of the Constitution”.

16. The said court then went on to quote from Halsbury’s Laws of England, 4th Edition Vol. 37 Para 14; as follows;

“The jurisdiction of the court which is comprised within the term ‘inherent’ is that which enables it to fulfill itself, properly and effectively, as a court of law.

.....

…..

It must be distinguished from the exercise of judicial discretion; it may be exercised even in circumstances governed by rules of court ….”

17. Therefore, although there are specific rules which govern applications for Review, that cannot, of itself, be a bar to the court’s inherent jurisdiction to take such action as is deemed to be necessary in enabling it to properly and effectively fulfill itself as a court of law.

18. Accordingly, I do hold that the application by the plaintiff is properly before the court, pursuant to Section 3A of the Civil Procedure Act.

19. When Havelock J. instructed the learned Deputy Registrar to carry out the exercise of taking of Accounts, the learned Judge expressly stated that that exercise would be undertaken pursuant to Order 22 rule 17 of the Civil Procedure Rules.  The said rule says that;

“The court may, either by the decree directing an account to be taken or by any subsequent order, give special directions with regard to the mode in which the account is to be taken or vouched, and in particular may direct that in taking the account the books of account in which the accounts in question have been kept shall be taken as prima facie evidence of the truth of the matter therein contained with liberty to the parties interested to take such objection thereto as they may be advised”.

20. In my understanding, when the learned Deputy Registrar was directed to take accounts in accordance with Order 21 Rule 17 of the Civil Procedure Rules, she was simply assisting the Judge to undertake a task which the Judge would have otherwise been expected to undertake personally.

21. Therefore an order under rule 17 is different from a situation under Order 49 Rule 7, pursuant to which the Registrar or Deputy Registrar would be exercising his Special Powers, as conferred by the rules.

22. Under Rule 17 of Order 21, it is the Judge who still retains jurisdiction to take accounts.   However, the Judge was simply getting the practical assistance of the Deputy Registrar, in carrying out the function entrusted to the Judge.

23. Meanwhile, under Order 49 rule 7, the Registrar has the power, in his own capacity, to undertake the tasks which are specified.  In exercising jurisdiction under Order 49, the Registrar does not act on the directions of a Judge.

24. Therefore, in this case, it was the court which was taking accounts, through the practical assistance by the learned Deputy Registrar.

25. Accordingly, when the court was called upon to review the results of the findings made, the court was actually being asked to review its own decision, albeit one which was taken on its behalf.

26. This is therefore not a request for an appeal from the decision of the Deputy Registrar.

27. Havelock J. had indicated that the Court was taking Accounts in order to enable it satisfy itself if the Decree had been settled in full.  If the court was satisfied that the Decree had been satisfied in full, the court would lift the Prohibitory Order.

28. The plaintiff has now argued that the Decree had not been satisfied in full.

29. On the other hand, the defendants emphasize that they had not only satisfied the Decree in full, but that there had indeed been an overpayment.

30. In my considered view, neither of the parties could be prejudiced if the court were to revisit its calculations.  If the Decree had been settled in full, that fact cannot change.  Similarly, if the Decree had not yet been settled in full, that should be a verifiable fact that cannot change just because the calculations are revisited.

31. I also find that the plaintiff failed to participate in the taking of accounts.  Therefore , if the learned Deputy Registrar did not take into account anything which the plaintiff now says was relevant, it would be wrong to find fault with the Deputy Registrar.

32. When a party fails to utilize the opportunity available to him during proceedings, he cannot be heard to criticize the person who made the decision, on the grounds that the views of that party were not given due consideration.

33. In the event I now set aside the Ruling dated 13th March 2017.

34. However, I find that the plaintiff has failed to satisfy the court that there is any reason to order that the Accounts be taken by a different Deputy Registrar.  No bias or discrimination has been alleged, let alone being proved against the Deputy Registrar.

35. However, I also know that Ms. Nancy Makau, the learned Deputy Registrar who took the Accounts in this case, has since been transferred to Nakuru.  It is only because of her unavailability that the taking of Accounts will now fall upon the shoulders of Ms. Elizabeth Tanui, Deputy Registrar.

36. In respect to costs, I order that the plaintiff shall pay the same to the defendants, notwithstanding the fact that the application was successful.  I so order because it is the plaintiff who is blameworthy for the failure to make available its submissions to the Deputy Registrar.

37. The plaintiff will also pay to the defendants, the costs attendant to the proceedings when the Accounts were being taken.

DATED, SIGNED and DELIVERED at NAIROBI this5th dayof December2017.

FRED A. OCHIENG

JUDGE

Ruling read in open court in the presence of

Obuya for Ouma for the Plaintiff

Thuita for the 1st Defendant

Thuita for the 2nd Defendant

Thuita for the 3rd Defendant

Collins Odhiambo – Court clerk.