National Bank of Kenya Limited v Alfred Owino Balla [2017] KEHC 1774 (KLR)

2REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT KISII

CIVIL APPEAL NO. 93 OF 2014

NATIONAL BANK OF KENYA LIMITED...................................APPELLANT

VERSUS

ALFRED OWINO BALLA…………........................................  RESPONDENT

(An appeal from the judgment and decree of Hon. KIBET SAMBU (Principal Magistrate) dated and delivered on the 31st  day of July, 2014 in the Original KISII CMCC No. 210 of 2012. )

JUDGMENT

1. The appellant herein NATIONAL BANK OF KENYA LIMITED was the 1st Defendant in the suit filed before the lower court in Kisii CMCC No. 210 of 2012 in which the respondent, then the plaintiff, sued it alongside the Attorney General (2nd Defendant) for general and special damages arising out of a claim for unlawful arrest, wrongful confinement and malicious prosecution.

2. The plaintiff’s/Respondent’s claim before the lower court was that on or about 27th January 2010, without lawful cause, basis or color of right, the appellant reported a complaint to the Criminal Investigations department Offices at Kisii Division alleging that the respondent had misappropriated and/or stolen the sum of Kshs. 424,530/= only belonging to the appellant.

3. The respondent further claimed that on 3rd February 2010, he was arraigned in court vide Kisii CMCR No. 258 of 2010 and charged with the offence of stealing by servant contrary to Section 281 of the Penal Code. The respondent also claimed that his arrest, arraignment and prosecution, at the instance of the appellant, was malicious, unfounded and reckless but that he was, on 17th January 2012, acquitted of the charges. He further stated that he suffered both special and general damages following his said unlawful arrest, confinement and prosecution.

4. Through its defence filed on 19th July 2012, the appellant denied all the allegations made by the respondent in the plaint and stated that all its officers did was to report suspected crimes to the police who then conducted their own independent investigations before preferring charges against the respondent. The appellant reiterated that it did not privately investigate, initiate, continue or perpetuate any charges against the respondent as this was the exclusive responsibility of the state through the office of the Attorney General.

5. The case before the lower court was heard and determined on 31st July 2014 in favor of the respondent who was then awarded Kshs. 1,000,000/= general damages and Kshs. 160,000/= special damages thereby triggering the instant appeal in which the appellant listed 10  grounds of appeal in its memorandum of appeal wherein he mainly faulted the trial magistrate for, inter alia, applying the wrong principles in assessing damages, failing to properly evaluate the evidence tendered before him and holding that the respondent had proved his case to the required standards.

6. When the appeal came up for hearing on 22nd May 2017, parties agreed to canvass it by way of written submissions.

Appellant’s submission

7. Through its advocates M/s Nyachae & Ashitiva advocates, the appellant submitted that it was clear, from the Respondent’s own pleadings, that all the appellant’s agent did was to make a complaint about the misappropriation of funds, failure to account or stealing by the respondent and that the report formed a basis for the police to carry out their own independent investigations and thereafter make a decision on whether or not to charge the respondent in court. The appellant maintained that it never arrested, charged or prosecuted the respondent as this was the preserve of the police and the Attorney general pursuant to their constitutional mandate and duty.

8. The appellant further submitted that the Attorney general, in its defence filed before the lower court, admitted that it arrested and charged the respondent based on a genuine report that was made at the police station after carrying out investigations which revealed that reasonable and probable cause had been established to show that the respondent had committed the offence. The appellant added that there was no indication or insinuation by the Attorney General to the effect that the police and prosecutors did not act independently or were influenced by the appellant in carrying out their constitutional mandate. It was the appellant’s case that the report that it made to the police was an honest report made bona fides based on reasonable suspicion that a crime had been committed.

9. The appellant relied on the decision in the case of Juma Khamis Kariuki vs East African Industries HCCC No. 1414 of 1980 (unreported) wherein the basic conditions for the success in a claim for unlawful arrest, unlawful detainment and malicious prosecution were set out to be:

I.That the Bank must have instituted or instigated the criminal proceedings against the Respondent (instigation being a question of fact and/or degree);

II.That there was no reasonable or probable cause for the arrest and prosecution;

III.That the arrest and prosecution are motivated by malice;

IV.That the proceedings ended in the Respondent’s favor; and

V.That the Respondent has suffered damages

10. Based on the above cited case and the case of Kenya Reinsurance Corporation Ltd vs Eliud Muranga [2006] eKLR, the appellant argued that it was not enough for the respondent to state that he had been acquitted in the criminal case as the standard of proof in criminal cases is totally different from that required in civil cases since an acquittal in a criminal case, because the prosecution has not proved its case beyond reasonable doubt, is not the same as a finding on liability on the balance of probabilities required in civil cases.

11. While relying on the decision in the case of Express Kenya Ltd vs Faith Muthoni Makumi Nairobi HCCA No. 9 of 1999 (unreported), the appellant submitted that the respondent did not adduce any evidence as to the exact report made to the police that resulted in the respondent’s arrest and prosecution and that it was therefore not possible to ascertain the exact contents of the report made to the police so as to enable the court determine whether the report was malicious or not.

12. The appellant further submitted that ample evidence was adduced, both during the hearing of the criminal case whose outcome formed the basis of the civil proceedings before the trial court and at the hearing of the civil case that is the subject of the instant appeal, to the effect that there were serious irregularities in the manner in which some of the appellant’s officers carried out their duties and that these irregularities led to the report that was made to the police regarding the loss of funds to the tune of Kshs. 424,530/=. The appellant’s case was that it was the respondent’s own admission on cross examination that he was the accounting officer responsible for any anomaly that would occur in the cash held at the Automated Teller Machines (ATM)

13. The appellant observed that the fact that the respondent had been faithful employee for a period of 17 years was enough proof that the appellant could not have been harboring any malice against the respondent who it had promoted to the position of a chief teller.

14. The appellant gave a detailed analysis of the evidence tendered before the court in the criminal proceedings that gave rise to the civil claim for damages for malicious prosecution and submitted that a surprise audit check of the ATM showed that the sum of Kshs. 424, 530/= was missing which loss was attributed to the respondent after further investigations were carried out by the police. The appellant added that having established that it only made a report to the police based on the auditor’s report, which was neither false, reckless or malicious,  its participation in the initiation of the criminal proceedings ended and all that was left was for the police and the Attorney General to decide whether or not any charges will be filed in court.

15. The appellant referred to the decision in the case of  Henry Gilfex Ombati vs University of Nairobi HCCC No. 2682 of 1998 (unreported) wherein, Justice Alnasir Visram (as he then was) at page 5 referring to and quoting with approval the decision of LAW, Ag V-P( as he then was)in Egbema vs West Nile District Administration [1972] EA. 60 held that:

“…The Ugandan police are not servants or the agents of the respondent..”.

Is the respondent also liable to damages in respect of the abortive prosecution? I do not think so. The decision whether or not to prosecute was made by the Ugandan Police, who are not servants or the agents of the respondent, after investigation. I can see no evidence of malice on the part of the respondent. The appellant was an obvious suspect as he was responsible for the security of the office from which the cash box disappeared. It cannot be said that there was no reasonable and probable cause for the respondent instigating a prosecution against the appellant. The actual decision to do so was taken by the Ugandan Police. As the judge has made no finding as to whether the instigation of the prosecution on was due to malice on the part of the respondent, this court must make its own finding. In my view the circumstances of this case reasonably pointed to the appellant as a suspect, and there was no sufficient evidence that in handing over to the Ugandan Police for his case to be investigated, and, if necessary, prosecuted the respondent was actuated by malice.”

16. Taking a cue from the above cited authorities, the appellant submitted that it neither falsely or otherwise arrested nor instituted the prosecution against the respondent as all it did was to make a complaint, based on reasonable cause, to the police and was not responsible for the arrest, detention or prosecution of the respondent.

17. In determining the issue of reasonable cause, the appellant relied on the decision in Kagane & Others vs Attorney General & Another (1969) E.A. 643 wherein it was held:

“ (i) Whether there was reasonable and probable cause for the prosecution is primarily to be judged on the objective basis of whether the material known to the prosecutor would satisfy a prudent and cautious man that the accused was probably guilty…”

“…(iv) on the facts, no reasonable person could honestly have believed that the prosecution was at all likely to succeed and the second defendant was actuated by malice.”

18. The appellant reiterated that in the instant case, it had reasonable and probable cause to believe that its money had been lost from the custody of the respondent and it is this genuine belief that prompted it to file a report with the police who then made the decision to arrest and prosecute the respondent and further that the respondent’s acquittal did not connote proof of malicious prosecution.

19. On whether or not malice was proved, the appellant relied on the decision in the Kagane case (supra)wherein RUDD. J. stated at page 645;

“The plaintiffs have further to prove that the prosecution was instituted with malice on the part of the prosecutor King. In this connection, malice means that the prosecution was motivated by something more than a sincere desire to vindicate justice.’

20. The appellant maintained that the respondent’s case failed to meet and satisfy the factual and legal threshold of establishing a case of false arrest, unlawful detention and malicious prosecution. It urged this court to find that the respondent is not entitled to the recovery of the special and general damages claimed.

Respondent’s submissions

21. Through his advocates M/s Oguttu Mboya & Co. Advocates, the respondent submitted that the trial magistrate properly evaluated the evidence tendered by both parties including crucial documents before arriving at the right decision. He maintained that the appellant made a report to the police without any justifiable cause before granting him time to balance the accounts or requiring his presence during the audit.

22. It was the respondent’s case  that he had fulfilled all the 4 elements/requirements in a claim of damages for malicious prosecution which he listed as:

a)Proof that criminal proceedings were instituted by the defendant.

b)The prosecution was actuated by malice.

c)The prosecution was instituted without reasonable or probable cause and

d)The prosecution was terminated in favor of the plaintiff.

23. The respondent argued that he had proved his case against the appellant on a balance of probabilities as he relied on the judgment delivered in Kisii CMCR No. 258 of 2010 in which he was acquitted of the charges preferred against him at the instance of the appellant. He further faulted the appellant for lodging a complaint with the police without first ascertaining the veracity and/or authenticity of the complaint so as to confirm that the same was not actuated by mala fides or witch-hunt.

24. The respondent also faulted the police for relying solely on the appellant’s audit report and for failing to carry out its statutory duty of conducting independent investigations into the alleged offence of theft by servant before charging him in court to show that the prosecution was instituted without reasonable cause.

25. He submitted that the appellant was malicious in reporting the complaint before according him an opportunity to reconcile the accounts as was the normal practice in the bank and cited the case of Kagane & Others (supra) wherein the test to be applied in determining whether or not a complaint is reasonable or probable was discussed. He further cited the case of Sekadu vs Sebaduka (1968) E.A. pgs 213-215 wherein the court held that the person who sets the law in motion and causes another to be detained by the police becomes responsible for the continued detention.

26. On the award of both special and general damages, the respondent submitted that the same was proper, sound and in tandem with the awards made by courts in similar cases.

The Evidence

27. This is a first appeal and therefore this court is enjoined to re-evaluate and re-analyze the evidence tendered in the lower court so as to arrive at its own independent conclusion (See Stanley Maore vs Geoffrey Mwenda Nyeri Civil Appeal No. 147 of 2002).

28. The respondent’s case before the lower court was that he was the appellant’s employee between 4th December 1994 till 10th February 2010 when he was dismissed from employment and that he held the position of the chief teller at the time of his said dismissal. He narrated, in detail, the events of 26th January 2010 when a surprise audit on cash at the bank was carried out by the appellant’s auditors which led to his arrest on 27th January 2010 and culminated in his arraignment before the court at Kisii CMCR No. 258 of 2010 wherein he was charged with the offence of stealing Kshs. 424,530/=. He stated that he was eventually acquitted of the said charge on 17th January 2012 and produced a copy of the proceedings and judgment in the criminal case as an exhibit in his case. The respondent’s case was that the appellant did not lose any money as claimed and that the appellant Kisii Branch manager lodged the complaint with the police prematurely before first according him an opportunity to reconcile the accounts so as to explain any shortfalls as was the normal practice and procedure in the bank.

29. DW1, Marceline Akoth Juma, the appellant’s Kisii Branch Manager testified that the appellant’s auditors from Nairobi, who were on a routine surprise audit, verbally informed her that they had detected a shortfall of Kshs. 424,530/= during their audit which information prompted her to make a report to the police that resulted in the respondent’s arrest, prosecution, and subsequent acquittal of the offence of the stealing by servant.

30. DW2 Emmanuel Odondi testified that he was one of the auditors who carried out the audit exercise which revealed that there was a shortfall of Kshs. 424,530 that was attributed to the respondent. He produced the audit report as an exhibit before the court and stated that it was the revelations made in the said report that led to the arrest and arraignment of the respondent in court.

Analysis and determination

31. I have carefully considered the record of appeal and the parties’ advocates’ respective submissions. I note that the issues that fall for determination are:

a)Whether the respondent proved his case against the appellant to the required standards.

b)Whether the appellant is liable to compensate the respondent in damages for malicious prosecution and if so, what orders should be made for the said award of damages.

c)Who should bear the costs of the appeal.

32. On the first issue for determination, I note that counsel for both parties aptly addressed themselves to the law relating to the tort of malicious prosecution as expressed by courts in the numerous decided cases that they cited.

33. The Court of Appeal of East Africa expressed itself on the same subject in the case of Mbowa vs East Mengo District Administration [1972] E.A 352 as follows:

“The action for damages for malicious prosecution is part of the common law of England.. The tort of malicious prosecution is committed where there is no legal reason for instituting criminal proceedings. The purpose of the prosecution should be personal and spite rather than for the public benefit. It originated in the medieval writ of conspiracy which was aimed against combinations to abuse legal procedure, that is, it was aimed at the prevention or restraint of improper legal proceedings…It occurs as a result of the abuse of the minds of judicial authorities whose responsibility is to administer criminal justice. It suggests the existence of malice and the distortion of the truth. It’s essential ingredients are: (1) the criminal proceedings must have been instituted by the defendant, that is, he was instrumental in setting the law in motion against the plaintiff and it suffices if he lays an information before a judicial authority who then issues a warrant for the arrest of the plaintiff or a person arrests the plaintiff and takes him before a judicial authority; (2) the defendant must have acted without reasonable or probable cause i.e. there must have been no facts, which on reasonable grounds the defendants genuinely thought that the criminal proceedings were justified; (3) the defendant must have acted maliciously in that he must have acted, in instituting criminal proceedings, with an improper and wrongful motive, that is, with an intent to use the legal process in question for some other than its legally appointed  and appropriate purpose; and (4) the criminal proceedings must have been terminated in the plaintiff’s favour, that is, the plaintiff must show that the proceedings were brought to a legal end and that he has been acquitted of the charge… The plaintiff, in order to succeed, has to prove that the four essentials or requirements of malicious prosecution, as set out above, have been fulfilled and that he has suffered damage. In other words, the four requirements must “unite” in order to create or establish a cause of action. If the plaintiff does not prove them he would fail in his action. The damage that is claimed is in respect of reputation but other damages might be claimed, for example, damage to property… The damage to the plaintiff results at the stage in the criminal proceedings when the plaintiff is acquitted or, if there is an appeal, when his conviction is quashed or set aside. In other words, the damage results at a stage when the criminal proceedings came to an end in his favour, whether finally or not. The plaintiff could not possibly succeed without proving that the criminal proceedings terminated in his favour, for proving any or all of the first three essentials of malicious prosecution without the fourth which forms part of the cause of action, would not take him very far. He must prove that the court has found him not guilty of the offence charged…The law in an action for malicious prosecution has been clearly defined and in so far as the ordinary criminal prosecution is concerned the action does not lie until the plaintiff has been acquitted of the charge. In this case the respondent could not have brought his action for malicious prosecution until the prosecution ended in his favour. He could not have maintained his action whilst the prosecution was pending nor could he have maintained an action after he had been convicted. His right to bring the action only accrued when he secured his acquittal of the charge on appeal, and he then had the right to bring this action for damages…Time must begin to run as from the date when the plaintiff could first successfully maintain an action. The cause of action is not complete until such a time, and in this case this was only after he was acquitted on appeal”.

34. From the above foregoing, it is now settled law that the 4 conditions to be met in a claim for malicious prosecution are:

a)Criminal proceedings must have been instituted against the plaintiff.

b)The defendant must have acted without reasonable or probable cause.

c)The defendant must have acted maliciously in instituting the criminal proceedings.

d)The criminal proceedings must have been terminated in the plaintiff’s favour.

35. In the instant case, it was not in dispute that criminal proceedings were instituted against the respondent at the instance of a complaint lodged by the appellant through its manger at the Kisii Branch and further, that the said criminal proceedings ended in the respondent’s acquittal, in which case, the said proceedings were terminated in the respondent’s favour.

36. What this court needs to determine in this appeal, therefore, is whether the appellant had reasonable cause and/or justification to make the complaint to the police and whether the criminal prosecution was actuated by malice.

37. The test for determining whether a defendant, in a case of malicious prosecution, acted with reasonable or probable cause was discussed in the Kagane case (supra) as follows:

“Reasonable and probable cause is an honest belief in the guilt of the accused based upon a full conviction founded upon reasonable grounds of the existence of a state of circumstances, which assuming them to be true, would reasonably lead an ordinary prudent and cautious man placed in the position of the accuser to the conclusion that the person charged was probably guilty of the crime imputed…Excluding cases where the basis for the prosecution is alleged to be wholly fabricated by the prosecutor, in which the sole issue is whether the case for the prosecution was fabricated or not, the question as to whether there was reasonable and probable cause for the prosecution is primarily to be judged on the basis of objective test. That is to say, to constitute reasonable and probable cause the totality of the material within the knowledge of the prosecutor at the time he instituted the prosecution, whether that material consisted of facts discovered by the prosecutor or information which has come to him or both, must be such as to be capable of satisfying an ordinary reasonable prudent and cautious man to the extent of believing that the accused is probably guilty. If and insofar as that material is based on information, the information must be reasonably credible, such that an ordinary reasonable prudent and cautious man could honestly believe to be substantially true and to afford a reasonably strong basis for the prosecution…If it is shown to the satisfaction of the judge that a reasonable prudent and cautious man would not have been satisfied that there was a proper case to put before the  court, then absence of reasonable and probable cause has been established. If on the other hand the judge considers that prima facie there was enough evidence to justify a belief in an ordinary reasonable prudent and cautious man that the accused was probably guilty then although this would amount to what I call primary reasonable and probable cause the judge may have to consider the further question as to whether the prosecutor himself did not believe in the probable guilt of the accused, and this is obviously a matter which is to be judged by a subjective test. This subjective test should only be applied where there is some evidence that the prosecutor himself did not honestly believe in the truth of the prosecution. In as much as this subjective test only comes into operation when there were circumstances in the knowledge of the prosecutor capable of amounting to reasonable and probable cause, the subjective test does not arise where the reason alleged as showing absence of reasonable and probable cause is merely the flimsiness of the prosecution case or the inherent unreliability of the information on which the case was based, because this is a matter for the judge alone when applying the objective test of the reasonable prudent and cautious man. Consequently the subjective test should only be applied where there is some evidence directly tending to show that the prosecutor did not believe in the truth of his case. Such evidence could be afforded by words or letters or conduct on the part of the prosecutor which tended to show that he did not believe in his case, as for example, a failure or reluctance to bring it to trial, a statement that he did not believe in it and, I think possible, an unexplained failure to call an essential witness who provided a basic part of the information upon which the prosecution was based.”

38. In Simba vs Wambari (1987) KLR 601, it was held:

“The plaintiff must prove that the setting of the law in motion by the inspector was without reasonable and probable cause…if the inspector believed what the witnesses told him then he was justified in acting as he did and I am satisfied the plaintiff has not established that he did not believe them or alternatively that he proceed recklessly and indifferently as to whether there were genuine grounds of prosecuting the plaintiff or not.”

39. In the instant case, it was the appellant’s evidence that its branch manager at Kisii acted on the banks auditor’s report that there was a shortfall in the cash held in the respondent’s custody. The trial court summarized the evidence of the prosecution, in part, as follows in the judgment at the criminal trial.

“The three auditors (PW3, PW5 and PW6) compiled their audit report dated 1/2/2010 revealing a shortfall of Kshs. 424,530/=. The Audit Report was given to PW1. She (PW1) telephoned National Bank Headquarters security Department and reported the matter to Mr. Ogana who instructed her to report the matter to the police. Acting on Mr. Ogana’s instructions, PW1 went and reported the matter to the CID officers at Kisii CID office. PW1 recorded her statement. Two CID officers went to National Bank Kisii Branch and arrested the accused after PW1 identified him (accused) to them.”

40. The trial court’s said summary however contradicts the banks manager’s own version on the sequence of events that led to the arrest of the appellant, which was as follows:

“One of the Auditors went to count the accused’s cash in accused’s office. The Auditor by the name Mr. Mbuthia came and told me that after counting the money in accused’s office he found him with a shortfall of Kshs. 181,530/-. I told the Auditors to go ahead and compile their report. They compiled their report the same day and came up with a shortfall of Kshs. 424,530/=. They presented the said report to me. This is the report the three Auditors compiled and handed over to me. (MfI2).

After receiving the said report I telephoned our Head Quarters security department and reported the matter to Mr. Ogana.

On 27/1/10 Mr. Ogana came to our Kisii Branch from Nairobi.

On 26/1/10 Mr. Ogana had instructed me on phone to report the matter to the police. The same day (26/1/10) I went and reported the matter to the CID officers at Kisii Police Station. I recorded my statement at CID office. Two CID officers came to Kisii Branch and arrested the accused in my presence. I personally identified the accused to the CID Officers who arrested him. Subsequently the accused was charged with the offence of stealing Kshs. 424,530/- for NBK.”

41. From the above extract of the bank manager’s testimony it is not clear whether the amount of shortfall discovered by the auditors was Kshs. 181,530 or 424,530/=. It is also apparent that a report regarding the alleged loss of money was made to the police almost immediately after the auditors made their report to the manager and before any attempts were made by the appellant to confirm the loss from the respondent or to seek his input, clarification or reconciliation of the accounts. It is also clear, from the manager’s testimony, that she did not seek any clarification from the respondent over the alleged loss of money before she made her report to the police.

42.  In her own testimony during the Criminal trial, PW1 conceded that it was not unusual or unlawful for a teller to have an excess or shortfall in the cash that they had at hand as long as the shortfall or excess could be explained or reconciled. The said witness had the following to say during cross examination.

“The accused also had a shortfall of Kshs. 185,530/- on his cash at hand on 26/1/10.

The accused balanced the money given to him on 25/1/10. The accused balanced the money he was given on 25/1/10 by filling in the Teller’s specification sheet.

Veronica Ondara (Cash Officer) was the accused’s immediate supervisor. I did not check if the cash officer checked the accused’s teller’s specification sheet for 25/1/10. I am not aware whether the accused declared a shortfall on 25/1/10. It is common for a teller to have an excess or shortfall.

It does not mean that a person who has declared the short fall has stolen or taken the money (short fall).”

43. The question which then arises from the above extract, is why the manager decided to involve the police in the matter upon discovery of the shortfall in cash held by the respondent if the said shortfall was a normal occurrence which did not necessarily amount to theft. On further cross examination, the said witness (PW1) was categorical that the respondent had not been afforded an opportunity to balance his account before he was summoned by the police. The witness stated as follows:

“I am aware that the accused was summoned to the CID office Kisii on 26/1/2010.  By the time he was summoned to the CID office he had not been afforded an opportunity to balance his account the Kshs. 181,530/= (shortfall on the cash at hand on 26/1/10) is part of the money the accused is charged to have stolen.”

44. My humble view is that the totality of the circumstances under which the respondent was arrested and charged in court for the offence of theft by servant point to the fact that the said action was taken by the appellant prematurely before first verifying all the facts of the case and before allowing the respondent to give an account of the cash that he had at hand. It is clear to me that at the time the bank manager made the report to the police, she had no probable, reasonable or justifiable cause to hold the view that the respondent had stolen the money in question and it was therefore a no wonder that the respondent was eventually acquitted of the charges.

45. Malice can, in the circumstances of this case, be inferred from the hurried and flippant manner in which the appellant’s agents acted in making of their audit report without involving the respondent or seeking his clarification. It is worthy to note that the respondent had been a faithful employee of the appellant for a period of over 15 years prior to the events that led to the case at hand and therefore the more reason why the appellant ought to have exercised extreme caution and diligence in dealing with his case bearing in mind the far reaching consequences that a criminal prosecution had on the respondent’s illustrious and untainted career as a banker. This court notes that the respondent actually lost his job with the appellant following his said arrest and prosecution.

46. I find that the manner in which the appellant’s auditors conducted the audit cannot be said to have been prudent, cautious or in good faith going by the very haphazard and crude manner in which they handled the appellant’s employees that entailed literally grabbing some of the cash that was in the respondent’s custody without accounting for it, and making a rash and premature decision to involve the police in the matter. My own observation is that the appellant’s auditors acted in a commando style by descending on the appellant’s Kisii Branch in a ‘surprise and attack’ fashion and by literally breathing down the neck of the appellant’s employees as they conducted the audit thereby making findings that were not backed by any facts and that could not withstand the test of a criminal prosecution.

47. On their part, the police did not tender any defence or evidence before the trial court on how the decision to arrest and charge the respondent was arrived at and consequently, this court has no option but to find that there was no probable or reasonable cause to warrant the respondent’s prosecution.

48. Ojwang J.(as he then was) stated as follows in the case of Thomas Mboya Oluoch vs Lucy  Muthoni Stephen & Another Nairobi HCCC No. 1729 of 2001.

“Unless and until the common law tort of malicious prosecution is abolished by Parliament, policemen and prosecutors who fail to act in good faith, or are led by pettiness, chicanery or malice in initiating prosecution and in seeking conviction against the individual cannot be allowed to ensconce themselves in judicial immunities when their victims rightfully seek recompense..I do not expect that any reasonable police officer or prosecution officer would lay charges against anyone, on the basis or evidence so questionable, and so obviously crafted to be self-serving. To deploy the state’s prosecutorial machinery, and to engage the judicial process with this kind of litigation, is to annex the public legal services for malicious purposes.”

49. In this case, it was clear that the police acted solely on the basis of the appellant’s audit report and did not carry out their own independent investigations in order to verify the appellant’s claims. The above scenario leads to the big question on whether the police in the local stations have the wherewithal or expertise to carry out the intricate investigations revolving around banking frauds. The facts of this case and the fact that the police chose to rely on the appellant’s audit report leads to the irresistible conclusion that no independent investigations were conducted to confirm the veracity of the appellant’s complaint thereby exposing the appellant to the inconvenience of going through a trial on claims that had not been verified by the police.

50. Having found that the respondent was justified in his claim for damages for malicious prosecution, I now turn to the issue of quantum of damages. The principles for assessment of damages were set out by the Court of Appeal for East Africa, and subsequently adopted by our Court of Appeal in the following cases:

1)Kanga vs Manyoka [1961] EA 705, 709, 7013.

2)Lukenya Ranching and Farming Co-op. Society Ltd vs Kavoloto [1979] EA 414, 418, 419.

3)Kemfro Africa t/a Meru Express & Anor. vsA.M.Lubia & Anor [1982-88] I KAR 727.

4)C.A. No.66 of 1982 Zablon Mangu vs Morris W. Musila (unreported)

51. From the above authorities, it is clear that an Appellate Court will interfere with the exercise of discretion by the trial court when assessing damages if the trial court;

a)Took into account an irrelevant fact or,

b)Left out of account a relevant fact or,

c)The award is so inordinately low or so inordinately high that it must be a wholly erroneous estimate of the damages.

52. I am further guided by the principles laid down in Loice Wanjiku Kagunda -vs- Julius  Gachau Mwangi C A No. 142 of 2003 (UR) where the Court held as follows:-

“We appreciate that the assessment of damages is more like an exercise of judicial discretion and hence, an appellate court should not interfere with an award of damages unless it is satisfied that the judge acted on wrong principles of law or has misapprehended the facts or has for those or other reasons made a wholly erroneous estimate of the damages suffered. The question is not what the appellate court would award but whether the lower court acted on the wrong principles (See Mariga –vs- Musila (1984) KLR 257. )

53. Going by the dictum in the above cited authorities, I find that the trial magistrate’s exercise of discretion was in tandem with the principles stated hereinabove and was therefore exercised judicially.  The trial magistrate stated that her award on damages was guided by awards made in past court decisions and the inflationary trends. It is therefore my finding that the award of Kshs. 1,000,000/= general damages made to the respondent was justified and in line with awards made in similar cases. I therefore find no reason to interfere with the award made by the trial court for general damages.

54. In a nutshell, I find that the instant appeal lacks merit and the order that commends itself to me is to dismiss the said appeal with costs to the respondent.

Dated, signed and delivered in open court this 6th day of December, 2017

HON. W. A. OKWANY

JUDGE

In the presence of:

-  Mr. Godia for the Appellant

-  Miss Mireri  for the Respondent

- Omwoyo court clerk