BELUF ESTABLISHMENT v THE ATTORNEY-GENERAL [1993] KECA 32 (KLR)
The bottom line
#Kenyan courts can order compensation in foreign currency — not shillings — when your loss was suffered in dollars or another foreign currency.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the appellant should be compensated in United States dollars rather than Kenya currency for goods lost in transit through Kenya
- 2.Whether the Kenyan courts may adopt the rule in Miliangos v George Frank (Textiles) permitting judgments in foreign currency
- 3.Whether the trial judge was wrong in rejecting the foreign-currency authorities cited by the appellant and treating the claim as a normal damages claim
Key legal issues
#Currency of judgment where loss is suffered in foreign currency
Judgment should be entered in the foreign currency in which payment will be made, following Miliangos; the claim being in tort makes no difference.
The appellant's goods were lost in Kenya while in transit under an international convention allowing free passage to the sea, and the respondent was sued in tort. Liability was admitted and judgment was entered in Kenya currency equivalent to 82,643/92 US Dollars. Because of currency fluctuation the appellant would be paid much less than it lost. Applying Miliangos and the principle of restitutio in integrum, the trial judge was wrong to reject the authorities and treat the claim as a normal damages claim in Kenya currency.
Continuing application of English decisions in Kenya
Decisions of English courts, past and present, continue to apply in Kenya as authorities under section 3 of the Judicature Act, so the rule in Miliangos is available to Kenyan courts.
Section 3 of the Judicature Act applies the common law and statutes in force in England on 12th August 1897, and English decisions past and present continue to be applied here as authorities. The commercial world has changed since independence, with Kenya entering foreign transactions denominated in foreign currencies; insisting on compensation in local currency for foreign claimants would be contrary to agreement and bring the country into disrepute.
Legal principles established
#- Kenyan courts, as recipients of common law, are bound by the rule in Miliangos: where payment will be made in foreign currency, judgment may be entered in that currency, whether the claim is in tort or in contract.
- It is wrong for a trial court to reject the foreign-currency authorities and to award damages in local currency where the loss was suffered in foreign currency and currency fluctuation would under-compensate the plaintiff.
- The development of the law is a continuous process which should be encouraged so that courts can effectively arbitrate on the rights of people in accordance with natural justice.
Court orders
#- 1.Appeal allowed with costs
- 2.Orders for the appellant as proposed by Akiwumi JA (judgment in US Dollars rather than Kenya currency)
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
Gachuhi JA agreed with Akiwumi JA's judgment in draft. He reasoned that the law is a continuous developing process, that Kenya as a recipient of English common law under section 3 of the Judicature Act is affected by the House of Lords decision in Miliangos v George Frank (Textiles), and that where payment would be made in foreign currency, judgment should be entered in that currency, whether the claim is in tort or contract. He held the trial judge was wrong in rejecting the authorities cited and in awarding damages in Kenya currency.
As recipient of Common Law, we are affected by that decision. No matter whether the claim is in tort or in contract, where payment will be made in foreign currency, judgment should better be entered in that currency as claimed.p. 2
- On appeal from
- High Court of Kenya at Nairobi
- H.C.C.C. No 2436 of 1978
- Jurisdiction invoked
- First appellate jurisdiction over a High Court civil appeal (judgment in tort claim for loss of goods; trial court entered judgment in Kenya currency)
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
No matter whether the claim is in tort or in contract, where payment will be made in foreign currency, judgment should better be entered in that currency as claimed.
In this particular appeal, applying the decision in Miliangos case, I would also allow this appeal with costs.
As Omolo, J.A. also agrees, the order of the Court is that there will be for the appellant as proposed by Akiwumi, J.A.
I think the trial Judge was wrong in rejecting the authorities cited to him.
the development of the law is a continuous process which should be encouraged so as to deal with any new matter of law as and when such an occasion arises
Issues in the judgment
#The full judgment of the court (the judgment of Akiwumi JA) is not present in the provided text; only the concurring judgment of Gachuhi JA, which refers to Akiwumi JA's draft judgment, is available, so the complete reasoning and final orders as set out by Akiwumi JA cannot be quoted.
The appeal is numbered Civil Appeal 134 of 1986 yet the judgment appealed from is dated 7th November, 1987, an apparent inconsistency within the judgment.
The exact final orders proposed by Akiwumi JA (the currency and amount of judgment for the appellant) are described only indirectly and are not set out verbatim in the text available.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "BELUF ESTABLISHMENT v THE ATTORNEY-GENERAL [1993] KECA 32 (KLR)", Case Analysis (1993). Civil Appeal 134 of 1986. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/1993/32/eng@1993-09-23
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.