Kisumu Steel Company Limited v Arvind Engineering Limited [2017] KEHC 2879 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT KISUMU

CIVIL SUIT NO. 1 OF 2014

KISUMU STEEL COMPANY LIMITED …..... PLAINTIFF/APPLICANT

VERSUS

ARVIND ENGINEERING LIMITED ….... DEFENDANT/RESPONDENT

RULING

By a judgment delivered on 31st May 2017 this court entered judgment for the Plaintiff against the Defendant for a sum of Kshs 3,012,262/=  and directed that interest would be from the date of judgment.  On 22nd June 2017 the Plaintiff filed an application seeking an order for review of the order to interest from the date of filing suit till payment in full.

The grounds for the application as set out on the face of the application and the supporting affidavit of Mitchell J B Menezes, Advocate, are that this being a special damage claim interest ought to run from the date of filing suit, that there is an error on the face of the record, that the application has been made without undue delay, that the court has a wide discretion to grant the prayers sought and there will be no prejudice to the defendant.

The applicant relies on the following authorities -

Judicial Hints On Civil Procedure, Vol 1, Justice R Kuloba

Orix Oil (Kenya) Limited V Paul Kabeu & 2 Others [2014]eKLR

Lata V Mbiyu (1965)EA592

Hirji V Modessa (1967)EA 724

Khan V Cooke & Others (1975)EA 318

Civil Procedure Act and Rules

In opposition the respondent filed a replying affidavit sworn by Arvind Tiwari.  He deposes that there are no sufficient grounds to review the judgment as interest is in the discretion of the court and there is no error apparent on the face of the record.  He disputes that the sum upon which the interest was awarded arose from a special damage claim but general damages as no receipts or other proof was tendered. He further deposes that this court awarded the defendant a sum of Kshs 1,487,738/= for which it had sought interest from interest from 6th April

2012 and contends that the parties having pleaded different dates for their reliefs there can be no error on the face of the record and the only error was only in the amount claimed by the plaintiff in the Plaint and the sum awarded in the judgment but  which this court has since corrected.

This court also heard submissions of Mr.  Maganga, for the applicant and Mr.  Kimani for the respondent.

Section 26(1) of the Civil Procedure Act leaves the question of interest to the discretion of the court.  However, as was stated by my brother Gikonyo J, the question whether to award interest and the time from which such interest should run must be determined on well established legal principles-see  Orix Oil (Kenya) Limited V Paul Kabeu & 2 Others(suppra).  The position is that for general damages interest runs from the date of judgment whereas interest for special damages runs from the date of filing suit.  The rational for this was explained Prem Lata V Peter Mbiyu(suppra) as being that for special damages the sums claimed will already have been incurred whereas  general damages must await the determination of the court. It is however instructive that in Prem Lata V Peter Mbiyu the court was dealing with a claim for personal injuries.  In the instant case the claim was for  payment for services rendered and for damages for breach of contract. The plaintiff/respondent sued  for, inter alia, “a sum of 4,350,000 being agreed penalty for 29 weeks  delay in completion of the works at the rate of 150,000 per week beginning 1t April to 10th November 2012. The defendant/respondent had on the other hand counter-claimed for a sum of 1,487,738/= being the balance of the agreed contract price.  Having found that the Defendant/Respondent delayed in completing the works hence breaching the contract and the damages having been agreed this court awarded the plaintiff the sum claimed.  It also found that the Defendant/Respondent was entitled to the sum of 1,487,738/= being the balance of the contract price.  The sum due to the Defendant/Respondent was then set of from the sum awarded to the Plaintiff/Applicant.  Clearly the sum awarded to the Plaintiff/Applicant was not “a sum due to it as would a successful party deprived of the use of goods or money by reason of a wrongful act on the part of the defendant”-seePrem  Lata V Peter Mbiyu(suppra).The Plaintiff/Applicant's claim was one for general damages which had been agreed but which would not have become payable had this court found there was no breach. The Plaintiff/Applicant cannot say it was deprived of this sum by the unlawful act of the Defendant/Respondent.  The sum was not based on any hypothesis and if it was the basis was not explained to this court.  The same was allowed by this court only on the principle that a court of law cannot and ought not to re-write a contract for parties.  Indeed the Plaintiff/Applicant was aware of this as it had a separate claim for loss of profits arising from the breach.  That being the case there was no basis for awarding interest from the date of filing suit and there is no error apparent on the face of the record. The application for review has no merit and it is dismissed save to clarify from them that the interest shall be at court rates from the date of judgment till payment in full. The costs of this application to abide the appeal. It is so ordered.

Signed, dated and delivered at Kisumu this 5th day of October 2017

E. N. MAINA

JUDGE

In the presence of:-

Mrs Onyango for the Plaintiff/Applicant (Holding Brief for Menezes)

Mr.Mwaisigwa for the Defendant/Respondent(Holding Brief for Mr. Kimani

Court Assistant – Serah Sidera