Mandeep Singh Construction (K) Limited v Kauni [2022] KEHC 17247 (KLR)

Mandeep Singh Construction (K) Limited v Kauni (Civil Case E003 of 2021) [2022] KEHC 17247 (KLR) (1 December 2022) (Judgment)

Neutral citation: [2022] KEHC 17247 (KLR)

Republic of Kenya

In the High Court at Kajiado

Civil Case E003 of 2021

SN Mutuku, J

December 1, 2022

Between

Mandeep Singh Construction (K) Limited

Plaintiff

and

Kanka Ole Kauni

Defendant

Judgment

Introduction 1. The facts of this case, as can be ascertained from the Plaint dated February 11, 2021and filed on the same date, are that the Plaintiff was a lawful tenant on the premises known as L.R No Kimana/Tikondo/2145 – Kajiado following a tenancy contract between theplaintiff and the defendant in 2005. The initial contract was with Salama Construction Co. Ltd, affiliate company of the Plaintiff but was later transferred to the Plaintiff.

2. The plaintiff dutifully complied with the terms and conditions of the tenancy agreement without fail and paid rents up to April 2020 before the defendant breached the contract.

3. Theplaintiff made developments on the premises where it was keeping all its equipment, machinery, motor vehicles and tractors which were being used in the construction works the plaintiff was engaged in as a source of income.

4. In or around 2016, the plaintiff became aware that the defendant had hired and/or instructed goons or agents who invaded the suit premises while theplaintiff’s managing director was out of the country and maliciously, unlawfully, and with fraudulent intention, destroyed, vandalized and carted away all plaintiff’s property itemized in the Plaint without the plaintiff’s knowledge or consent.

5. Thedefendant in aggravated damages also fraudulently and unlawfully leased out the suit premises, together with the developments undertaken by the plaintiff thereon, to third parties without the plaintiff’s knowledge or consent, totally crippling the plaintiff’s business operations.

6. It is for the above reasons that the plaintiff has brought this suit seeking orders to hold the defendant- liable for the loss and damage and to seek compensation from the defendant.

The evidence 7. In the plaintiff seeks the following reliefs:a.A declaration that the defendant’s actions were unlawful and fraudulent.b.Special damages for lost equipment, machinery and construction/developments costs exact amount to be determined at the hearing.c.General damages for loss of use of both the equipment, machineries and suit premises.d.Costs of the suit.e.Interest on (b), (c) and (d) at court rates.

8. Thedefendant was served with copies of the Summons to enter appearance issued on February 11, 2021, Plaint dated February 11, 2021, witness statement dated February 11, 2021, list of witnesses dated February 11, 2021and list of documents dated February 11, 2021on April 23, 2021. He acknowledged service by signing on the Summons to enter appearance onApril 23, 2021. He did not enter appearance. This court was satisfied that the defendant was properly served and that he had failed to enter appearance or file any defence.

9. The matter proceeded to trial on June 22, 2022. Theplaintiff called one witness, Mr. Mandeep Sigh, the director of the plaintiff. He adopted his statement dated February 11, 2021as his evidence and list of documents dated June 16, 2022. He told the court that he has filed a valuation report showing value of all the properties as Kshs 59,403,400 and asked the court to compensate the plaintiff for the damage and loss caused.

10. The Plaint, further, filed submissions on August 29, 2022. I have read and considered the contents of the submissions. The plaintiff reiterated contents of the Plaint and referred to various documents including a valuation report that evaluated the loss and damage caused amounting to Kshs. 59,403,403/-

Determination 11. This matter proceeded by way of formal proof after the defendant failed to enter appearance. In Samson S Maitai &another v African Safari Club Ltd &another[2010] eKLR, the court observed that:“……. I have not seen a judicial definition of the phrase "Formal Proof". "Formal" in its ordinary Dictionary meanings - refers to being "methodical" according to rules (of evidence). On the other hand, according to Halsbury's Laws of England, Vol 15, para, 260, "proof" is that which leads to a conviction as to the truth or falsity of alleged facts which are the subject of inquiry. Proof refers to evidence which satisfies the court as to the truth or falsity of a fact. Generally, as we well know, the burden of proof lies on the party who asserts the truth of the issue in dispute. If that party adduces sufficient evidence to raise a presumption that what is claimed is true, the burden passes to the other party who will fail unless sufficient evidence is adduced to rebut the presumption.”

12. From the evidence adduced and the documents presented as evidence, the tenancy agreement was between thedefendant and Salama Construction Co. Ltd. This is not theplaintiff before the court. The plaintiff is Mandeep Singh Construction (K) Ltd. The Witness Statement of Mandeep Singh explains on paragraph 6 that upon the demise of the managing director, Harbhajan Singh of Salama Construction Limited, the company shut down but the plaintiff Company continued in possession and occupation of the suit premises with the defendant’s consent and knowledge and continued to pay the agreed monthly rents up to and including April 2020, which payment has been acknowledged by the defendant.

13. I have noted that in the submissions of theplaintiff, it is submitted that Salama Construction Co. Ltd is an affiliate Company of the plaintiff Company.

14. The burden of proof on the party that alleges. As stated in Samson S Maitai & another case above, “…. Generally, as we well know, the burden of proof lies on the party who asserts the truth of the issue in dispute. If that party adduces sufficient evidence to raise a presumption that what is claimed is true, the burden passes to the other party who will fail unless sufficient evidence is adduced to rebut the presumption.”

15. The defendant did not enter appearance or file defence. The evidence by the Mr. Mandeep Singh is not controverted. As the evidence stands, I have no reason to doubt it and I find it sufficient to support the plaintiff’s case that Salama Construction Company Limited, ab affiliate company of Mandeep Singh Construction (K) Ltd entered into a tenancy agreement which was taken over by the latter. The claim now is one of breach of contract by the defendant and damage of and carting away of property belonging to theplaintiff to unknown place.

16. Citing with approval the case of Photo Productions v Securicor Ltd(1980) AC 827, the court sated in Mwangi v Kiiru[1987] eKLR that:“Characteristically, commercial contracts are a source of primary legal obligation upon each party to it to procure that whatever has been promised will be done…Every failure to perform a primary obligation is a breach of contract.”

17. I have considered the documents produced by theplaintiff. Among these documents are receipts showing payment of rent and a document showing M-pesa transaction codes. I must admit that I find some difficulty in that it is not easy to tell who issued the vouchers and/or the recipient of the payments although there is acknowledgment of payment in some of the payments. With no evidence in rebuttal given that this suit is undefended it is my finding that these facts are not disapproved.

18. In Benjamin Ayiro Shiraku v Fozia Mohammed [2012] eKLR , the court, while citing Combe v Combe(1951) 2 KB 215, stated that:“the principle, as I understand it, is that, where one party has, by his words or conduct, made to the other a promise or assurance which was intended to affect the legal relations between them and to be acted on accordingly, then, once the other party has taken him at his word and acted on it, the one who gave a promise or assurance cannot afterwards be allowed to revert to the previous legal relations as if no such promise or assurance had been made by him, but he must accept their legal relations subject to the qualification which he himself has so introduced, even though it is not supported in point of law by any consideration but only by his word.”

19. Looking at the authority above and comparing it to our instant case, the plaintiff has claimed that though the Contract was between Salama Construction Limited, they continued in possession and occupation of the suit premises and paid Rent to the defendant thereby creating a contractual relationship, by conduct, between the parties. The conduct by the parties therefore created an implied contract as addressed by the court in RTS Flexible Systems Ltd v Molkerei Alois Muller GmbH (2010) UKSC 14, that: -“…The general principles are not in doubt. Whether there was a binding contract between the parties and if so, upon what terms depends upon what they have agreed. It depends not upon their subjective state of mind, but upon a consideration of what was communicated between them by words or conduct, and whether that leads objectively to a conclusion that they intended to create legal relations and had agreed upon all the terms which they regarded or the law requires as essential for the formation of legally binding relations. Even if certain terms of economic or other significance have not been finalized, an objective appraisal of their words and conduct may lead to the conclusion that they did not intend agreement of such terms to be a precondition to a concluded and legally binding agreement.”

20. Similarly, in Lamb v Evans(1893) 1 Ch 218 the court stated that: -“……What is an implied contract or an implied promise in law? It is that promise which the law implies and authorizes us to infer in order to give the transaction that effect which the parties must have intended it to have, and without which it would be futile……”

21. Going by the above authorities one can therefore infer that there was an implied contract by conduct where one party was a tenant and the other allowed them to continue occupying the premises on condition rent was paid.

22. The plaintiff has prayed for both special damages and general damages. It is trite law that special damages ought to be specifically pleaded and proved. In our case the same was done through the valuation report where the value of the property stood at Kshs. 59,403,400/-.

23. On general damages, in Anson’s Law of Contract, 28th Edition at page 589 and 590, it is stated: -“Every breach of a contract entitles the injured party to damages for the loss he or she has suffered. Damages for breach of contract are designed to compensate for the damage, loss or injury the claimant has suffered through that breach. A claimant who has not, in fact, suffered any loss by reason of that breach, is nevertheless entitled to a verdict but the damages recoverable will be purely nominal”.

24. Nominal damages are defined in the Halsbury’s Laws of England, Third Edition vol. II, as follows:“388. 388. Where a plaintiff whose rights have been infringed has not in fact sustained any actual damage therefrom , or fails to prove that he has; or although the plaintiff has sustained actual damage, the damage arises not from the defendant’s wrongful act, but from the conduct of the plaintiff himself; or the plaintiff is not concerned to raise the question of actual loss , but brings his action simply with the view of establishing his right, the damages which he is entitled to receive are called nominal­­­… Thus in actions for breach of contract nominal damages are recoverable although no actual damage can be proved”.

25. The plaintiff did not tender evidence to prove the actual damage he suffered other than loss of machinery and equipment which is covered under special damages supported by the valuation report. Nonetheless, he is entitled to general damages, though nominally.

26. I have considered this case. As stated in this judgment, the evidence by the plaintiff is not rebutted. It remains unchallenged. I satisfied myself that service of summons was properly done. Thedefendant did not deem it fit to challenge this case. For the above reason I find for the plaintiff. I find that theplaintiff has proved on a balance of probabilities that there existed a contract between him and the defendant implied through the conduct of the defendant. I find that the plaintiff’s property enumerated in these proceedings was damaged and removed from the site to an unknown location thereby occasioning him loss.

27. In the end, I find for the plaintiff and grant reliefs as follows:a.A declaration is hereby issued that the defendant’s actions were unlawful and fraudulent.b.An award of special damages for lost equipment, machinery and construction/developments costs in the tune of Kshs 59,403,400. c.An award of nominal general damages for loss of use of both the equipment, machineries and suit premises to the tune of Kshs 1,500,000. d.Costs of the suit.e.Interest on (b), (c) and (d) at court rates.

28. Orders shall issue accordingly.

Dated, signed and delivered this 1stDecember, 2022. S. N. MUTUKUJUDGE