NATIONAL BANK OF KENYA LTD v SAMSON KARIUKI NJENGA AND RUAHA CONCRETE COMPANY LIMITED [2004] KEHC 2522 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA

AT NAIROBI (MILIMANI COMMERCIAL COURTS)

Civil Suit 835 of 1998

NATIONAL BANK OF KENYA LTD................................ PLAINTIFF

VERSUS

SAMSON KARIUKI NJENGA...................................1st DEFENDANT

RUAHA CONCRETE COMPANY LIMITED........ 2nd DEFENDANT

RULING

This is an application by the second Defendant, RuahaConcrete Company Limited to review, set aside and/orvacate the Judgment and decree against it. The applicationwas made under Order XLIV, Rule 1 and 2 and Order XX1Rule 22 of the Civil Procedure Rules.

The application is supported by an affidavit sworn on11th July, 2003 by one Manjit Singh Sethi who is theManaging Director of the Applicant company. The background of this matter is that the Plaintiff bank filed asuit against the first and second Defendants on 11thDecember, 1998 for K.shs 1,060,159. 05 together with interest thereon at 7% a month from 1st September, 1998until payment in full and costs. The claim was based on anagreement dated 17th May, 1996 in which the Plaintiff saidthat it agreed to give to the first Defendant and the firstDefendant agreed to take a credit card and to pay for alltransactions made by him on the card on receipt of receiptof the statement of transaction. That in consideration of thePlaintiff issuing the card in the name of the first Defendant,the second Defendant guaranteed the charges incurred bythe first Defendant through the use of the card.

The 2 Defendant separately but through the sameadvocates, Ramesh Manek advocates entered appearancesand defences respectively. The Plaintiff on 6th January, 2000filed an application for summary judgment. The Defendants opposed the application. They filed grounds of oppositionand a replying affidavit sworn by the 1st Defendant. Theapplication was heard on 23. 1.2002 by Justice Mbaluto.Both the Plaintiff and Defendants were represented bycounsels. The court on 6th February, 2002 delivered its rulingin which it found in favour of the Plaintiff and enteredjudgment in favour of the Plaintiff against the Defendantsjointly and severally as prayed in the plaint. The secondDefendant filed this application to review on 24. 9.2003. It isfounded on the grounds set out in the summons. TheApplicant says the guarantee issued by him had a limit thathis liability should not exceed K.shs 300,000/- which was theagreed amount. That the approved credit given to the 1stDefendant was only K.shs 300,000/- and even if theguarantee is held valid, the same was limited to theapproved amount of K.shs 300,000/-. That the summaryjudgment entered by this court against the Applicant is a purported guarantor to the 1st  Defendant for K.shs4,436,412. 40 and which amount was in excess of theamount that the Applicant guaranteed to pay.

The Applicant says that the issues he is raising nowwere pleaded by his counsel then and did not argue thesame before Justice Mbaluto. That during the aforesaidperiod he was indisposed over heart ailment and could notand did not brief the advocates on his defence in the matterwhen they filed the grounds of opposition. The Applicantannexed detailed medical report and his passport todemonstrate that he was indisposed and was out of thecountry around the time the summary judgment wasentered.

The application is opposed by the Plaintiff which filed areplying affidavit and grounds of opposition. I haveconsidered the application, supporting affidavits, replyingaffidavit, and the counsel's submissions.

The court's jurisdiction to review a decree or order emanate from section 80 of the Civil Procedure Act and Order XLIV of Rule 1 of the Civil Procedure Rules. The Applicant has invoked the said provisions. The said Rule reads as follows:-

"1 (1)   any person considering himselfaggrieved -

(a)   by a decree or order from which an appeal isallowed, but from which no appeal has beenpreferred; or

(b)   by a decree or order from which no appeal ishereby allowed, and who from the discovery of new and importantmatter or evidence which, after the exercise of duediligence, was not within his knowledge or could not beproduced by him at the time when the decree waspassed or the order was made, or on account of somemistake or error apparent on the face of the record, orfor any other sufficient reason, desires to obtain areview of the decree or order, may apply for a reviewof judgment to the court which passed the decree ormade the order without unreasonable delay."

The Court of Appeal in the case of KITHO -vs- KIOKO [1982] KLR 177,gave a guidance of how this provision should operate. Justice of Appeal Miller at P.181 said:-

"The operation of Order XLIV in the execution ofSection 80 above demands, inter alias, that anapplication for a review must be based on thediscovery of new and important matter ofevidence which after due exercise of duediligence, was not within at the time of the decreewas passed or the order made or on account ofsome mistake or error or any other sufficientreason.  The court to which the review applicationis made shall dismiss the application if satisfiedthat there is not sufficient of the grounds seekingreview, except for mistake or error appearing onthe face of the challenged record; and theApplicant must strictly prove the grounds forreview (excepting mistake or error on the record)failing which the application will not be granted."

The requirement for strict proof can be founding our present Civil Procedure Rules in the proviso to Rule 3:-

".......... provided that no such application shall be granted on the ground of discovery of new matteror evidence which the Applicant alleges was notwithin his knowledge, or could not be adduced byhim when the decree or order was passed ormade without strict proof of such allegations".

Counsel for the Applicant submitted that there is anerror on the face of the judgment in this case as the judge did not look and/or consider the guarantee document. Hesays that there was no contract which said that the 2ndDefendant agreed to pay interest at 7% per month untilpayment in full. That the interest of 7% is outside the contract and that the judge erred. He further added thatwhere there is an error on the law, that's a proper ground for appeal not review. However, if there is an error on afactual point, then it is a ground for review and that there isa distinction between the 2 situations. That the judge didnot appreciate the contract before him and as a result thesecond Defendant who guaranteed shs. 300,000/- is beingasked to pay shs. 4. 4. million, money which he did not takea cent of.

I have studied Justice Mbaluto's ruling and I find thatthe learned Judge did consider the guarantee document and the question of interest at the rate of 7% per month. The Judge said as follows:-

"As to the 2nd Defendant, it claims in its defence that itwas not aware that the 1st Defendant had agreed topay interest at 7% per month. That claim is absurd. Ifone may ask a rhetorical question - what was the 2ndDefendant guaranteeing when its director signed theemployees guarantee to pay:-

"the charges incurred by the 1st Defendantthrough the use of the card"

If it did not know what interest was being chargedon the card. The answer is obvious.  The 2nd Defendantshould have read and understood the terms andconditions of the agreement between the Plaintiff andthe 1st Defendant before agreeing to guaranteepayment and signing the guarantee it signed.

In its defence the 2nd Defendant also claims thatthe guarantee it signed was vitiated by lapses, laches,and indulgence granted to the 1st Defendant withoutreference to the 2nd Defendant Regarding thatdefence, however, no attempt was made either in thereplying affidavits or otherwise to show what thoseaverments mean or simply and in my opinion nothingturns on them and they raise no triable issues. Theabove points are the only matters in the defences ofthe 1st and 2nd Defendants which in my view warrantconsideration in this application. As shown above allthem lack substance and are frivolous".

From the foregoing, it is clear and obvious that thejudge did look at the guarantee document and applied hismind to it. He even quoted some parts of it. How then canit be said that he did not consider or look at the guaranteedocument? I think that it is unfair to the Judge to thatextent. Studying and interpreting the document he certainlydid and there is no error on the face of the record about it.As to whether the interpretation and conclusions he madeare correct or proper as a matter of law or fact, that is acompletely different question. This would go to thecorrective ness of the decision and merits thereof.

I was referred to the decision of Nyamogo & Nyamogo Advocates-vs- Moses Kipkolum Kogo, Civil Appeal No. 322 of 2000in which the Court in a unanimous decision said:

"............ An error on the face of the record cannot be defined precisely or exhaustively, there being anelement of indefiniteness inherent in its very nature,and it must be left to be determined Judicially the factsof each case. There is a real distinction between a mere erroneous decision and an error apparent on the factof the record.  Where an error on a substantial point of law stares one in the face, and there could reasonablybe no two options, a clear case of error would be made out An error which has to be established by a longdrawn process of reasoning or on points where there may conceivably be two opinions can hardly be said tobe an error on the face of record. Again, if a reviewadopted by the court in the original record is a possibleone, it cannot be an error apparent on the face of therecord even though another view is possible. Mereerror or wrong view is certainly no ground for a reviewalthough it may be for an appeal".

Applying the above principles to the present case, I amsatisfied that there was no errors apparent on the face ofthe record that would justify review.

I am further fortified by the decisions in National Bank of Kenya Limited -vs- Ndungu Niau, Civil Appeal No. 211of 1996 in which the Court of Appeal said,

"A review may be granted whenever the courtconsiders that it is necessary to correct anapparent error or omission on the part of thecourt. The error or omission must be self evidentand should not require an elaborate argument tobe established. It will not be a sufficient ground for review that another Judge could have taken adifferent view of the matter. Nor can it be aground of review that the court proceeded on anincorrect exposition of the law and reached anerroneous conclusion of law. Misconstruing astatute or other provisions of law cannot be aground for review."

Once again the said principles applied to this case demonstrate that the Applicant is aggrieved by the decision and reasoning of the Judge. The Judge did consider the guarantee and gave his reasons why it was binding on the 2nd Defendant. The fact that the Managing director was away and quite indisposed to give effective instructions surely cannot be a ground for review. He had lawyers on record who had the right to seek adjournment from the court. The matter proceeded on affidavit evidence and the director was not required to be present in court. In today's age, with communications technology, it is not a handicap for businessmen and women or corporations to transact business across the globe. It is possible to instruct counsel while one is abroad. The question of indisposition was not brought to the court's attention. In any case it cannot be a ground for review. Any failure by the then counsel to articulate issues before the court is also not a good ground for review.

In the case of Kamlesh Pattni -vs.- Nasir Ibrahim Ali & others. Civil case No. 418 of 1998,when dealing with a similar application I said that:-

"I do not think that this envisages or contemplatesmatters that relate to the advocacy of counsel,thoroughness of research, or discovery ofauthorities which could have been cited in supportof the arguments in the case".

In all, I am of the opinion that this is not a suitable case for review and I hold that the application has no merits and does not meet the requirements of Order XLIV. I therefore do hereby dismiss the application with costs to the Plaintiff.

DATED and DELIVERED at Nairobi this 9th day of March, 2004.

M.K. IBRAHIM

JUDGE