Irura v Safaricom Investment Co-operative Society Ltd [2022] KEHC 11358 (KLR)

Irura v Safaricom Investment Co-operative Society Ltd (Civil Case E013 of 2021) [2022] KEHC 11358 (KLR) (12 May 2022) (Ruling)

Neutral citation: [2022] KEHC 11358 (KLR)

Republic of Kenya

In the High Court at Kajiado

Civil Case E013 of 2021

SN Mutuku, J

May 12, 2022

Between

Martha Njeri Irura

Applicant

and

Safaricom Investment Co-operative Society Ltd

Respondent

Ruling

1. This ruling relates to an originating summons dated May 19, 2021 and amended on the June 3, 2021. The applicant sought from the respondent payment of Kshs 5,000,000 together with interest at 20% per annum from October 14, 2020 being the balance of the purchase price for the sale of 10 acres from LR No Kajiado/Kapeto/14508 by the sale agreement dated November 7, 2016. The applicant also sought costs of the suit.

2. When this matter came up for mention for purposes of directions on the November 17, 2021, this was informed by Mr Wandago appearing for the applicant that the principal sum, being Kshs 5,000,000 had been paid on September 21, 2021 and that what was outstanding was interest and costs. Payment of the principal sum was confirmed by Mr Wakwaya appearing for the respondent. Mr Wakwaya told the court that this matter was settled out of court with no court order. Parties were directed to submit on the matter on March 16, 2022.

3. On the morning of March 16, 2022, both counsel were present in court in the morning but Mr Wakwaya sought time up to 10. 00am to argue the matter. At 10. 15am the file was called but only Mr Wandago was present. He made his submissions.

4. He told the court that this suit was filed on May 28, 2021 for purposes of enforcing completion of a sale agreement executed in 2017; that the respondent has paid Kshs 25 million leaving a balance of Kshs 5 million to be paid after the completion, which was agreed to be upon transfer of the land in the name of the defendant and obtaining title; that on October 14, 2020, the respondent obtained title in his name and balance became due; that he did not pay the balance in 2020 but delayed until September 21, 2021 when balance was paid after the matter had been set down for directions on July 12, 2021 and that on that date directions were given that the matter be heard by affidavit evidence.

5. Mr Wandago told the court that costs follow event. He relied on rule 53 of the Advocates (Remuneration) Order and section 27 of the Civil Procedure Act. He argued that had the respondent complied with the agreement and paid, this suit could not have been filed. Urging that the award for costs is discretionary, he asked this court to exercise that discretion in favour of the respondent.

6. I have considered this matter. Section 27 of the Civil Procedure Act provides that:Subject to such conditions and limitations as may be prescribed, and to the provisions of any law for the time being in force, the costs of and incidental to all suits shall be in the discretion of the court or judge, and the court or judge shall have full power to determine by whom and out of what property and to what extent such costs are to be paid, and to give all necessary directions for the purposes aforesaid; and the fact that the court or judge has no jurisdiction to try the suit shall be no bar to the exercise of those powers:Provided that the costs of any action, cause or other matter or issue shall follow the event unless the court or judge shall for good reason otherwise order.

7. It was held in Republic vs Rosemary Wairimu Munene,ex-parteApplicant Vs Ihururu Dairy Farmers Co-operative Society Ltd (JR No. 4 of 2014) that:“The issue of costs is the discretion of the court as provided under the above section. The basic rule on attribution of costs is that costs follow the event....... It is well recognized that the principle, costs follow the event, is not to be used to penalize the losing party; rather it is for compensating the successful party for the trouble taken in prosecuting or defending the case.”

8. Further in Halsbury’s Laws of England, 4thEdition ( Re-issue), {2010}, Vol 10 para 16, the same principle is discussed as follows:“The court has discretion as to whether costs are payable by one party to another, the amount of those costs, and when they are to be paid. Where costs are in the discretion of the court, a party has no right to costs unless and until the court awards them to him, and the court has an absolute and unfettered discretion to award or not to award them. This discretion must be exercised judicially; it must not be exercised arbitrarily but in accordance with reason and justice.”

9. Similarly, in Party of Independent Candidate of Kenya vs Mutula Kilonzo & 2 others, HC EP No 6 of 2013, the court citing two leading decisions on the subject held inter alia that:“It is clear from the authorities that the fundamental principle underlying the award of costs is two-fold. In the first place the award of costs is a matter in which the trial Judge is given discretion. ……But this is a judicial discretion and must be exercised upon grounds on which a reasonable man could come to the conclusion arrived at. In the second place the general rule that costs should be awarded to the successful party, a rule which should not be departed from without the exercise of good grounds for doing so.”

10. It is clear to me that had the respondent paid the monies when they fell due, this matter would not have been filed. He failed to do so and necessitated the filing of this originating summons to recover the money. The money fell due on October 14, 2020, when the respondent obtained title in its name. The balance was paid on September 21, 2021. By this time, this matter had been filed in court and the applicant had made several appearances in court and spent time on the matter.

11. Having carefully considered this matter and the arguments by the applicant, it is my considered view that the right thing to do is to award interest on the principle sum, being Kshs 5 million at the rate of 20% from October 14, 2020 to September 21, 2021 and costs of the suit to the applicant. To that end the applicant shall file her bill of costs for taxation before the Deputy Registrar of this court. it is so ordered.

Dated, signed and delivered this May 12, 2022. S. N. MUTUKUJUDGE