Kenya Post Office Savings Bank v Interior Trends Ltd [2001] KECA 35 (KLR)
The bottom line
#Kenya's Court of Appeal ordered a furniture supplier to refund deposits for goods it never delivered, overturning the High Court's ruling against the bank.
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 conclusions reached by the trial court on the evidence should stand, having regard to the duty of a first appellate court to review and assess the evidence adduced at trial.
- 2.Whether there was any evidence to support the respondent's counter-claim of Shs.213,000 (originally pleaded as Shs.200,000).
- 3.Whether the appellant proved its claim for Shs.647,900, being the Shs.500,000 deposit for furniture for the Nakuru Branch that was never delivered and the Shs.147,900 unearned balance of the Shs.500,000 deposit for the Eldoret Branch.
Key legal issues
#The duty of a first appellate court in relation to the evidence and findings of the trial court.
The Court of Appeal is obliged to review and reassess the evidence adduced at trial and reach its own conclusion on whether the trial court's findings should stand.
Relying on Peter v Sunday Post Limited, the court held that as an appellate court it had to review and assess the evidence adduced in the trial court. It then independently re-evaluated the pleadings, the testimony and the exhibits rather than deferring to the Commissioner of Assize's conclusions, which enabled it to overturn both the dismissal of the claim and the award on the counter-claim. This statement of the appellate function is the classic ratio on the duty of a first appellate court.
Whether the respondent's counter-claim of Shs.213,000 was supported by evidence.
The counter-claim had no evidentiary support and was dismissed; the trial court erred in allowing it.
The counter-claim was pleaded at Shs.200,000 but awarded at Shs.213,000, and counsel for the respondent could not explain the change of figure. The trial judge had recorded that she could not understand the claim, noting that the delivery book showed only the plaintiff as customer and that the witness gave shifting versions of over-supply and quality changes. The Court of Appeal agreed that there was no evidence to support the counter-claim and held the award could not stand.
Whether the appellant proved its claim for Shs.647,900.
The claim was proved: the Shs.500,000 Nakuru deposit and the Shs.147,900 Eldoret shortfall were both refundable, making a liquidated claim of Shs.647,900.
The respondent's managing director admitted the contract and the deposits and conceded in cross-examination that the Nakuru contract had been terminated and not performed, so there was no basis for retaining the Shs.500,000 Nakuru deposit. Delivery notes established that furniture worth Shs.352,100 was delivered at Eldoret against a Shs.500,000 deposit, so the Shs.147,900 difference was also refundable. Together these made out a liquidated claim of Shs.647,900 which could not be resisted.
Legal principles established
#- On a first appeal, the appellate court is bound to review and assess the evidence adduced in the trial court and determine for itself whether the conclusion reached on that evidence should stand.
- A party who has been paid a deposit under a contract which it admits it did not perform cannot retain that deposit; it must be returned to the payer.
- A court cannot enter judgment on a claim or counter-claim that is unsupported by evidence.
Court orders
#- 1.Appeal allowed.
- 2.Judgment and decree of the superior court (High Court) set aside.
- 3.Judgment substituted in favour of the appellant in the sum of Shs.647,900 plus interest as prayed in the plaint.
- 4.Respondent's counter-claim dismissed with costs.
- 5.Costs of the appeal and costs of the suit in the superior court awarded to the appellant.
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court of Kenya at Nairobi
- H.C.C.C No. 2403 of 1997
- Jurisdiction invoked
- Not expressly stated in the judgment; the matter comes before the Court as a first appeal from the High Court of Kenya at Nairobi to the Court of Appeal.
Relief refused
#The respondent's counter-claim for Shs.213,000 (originally pleaded as Shs.200,000), together with damages for breach of contract, costs and interest.
The Court found no evidentiary basis for the counter-claim; the figure was changed from Shs.200,000 to Shs.213,000 without explanation, and the trial judge had herself recorded that she could not understand the claim.
The respondent's plea for dismissal of the appellant's suit.
The Court of Appeal found the liquidated claim of Shs.647,900 proved on the respondent's own admission of non-performance and the delivery notes.
Costs
Costs of the appeal and costs of the suit in the superior court awarded to the appellant; the respondent's counter-claim dismissed with costs (those costs also to the appellant).
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.
For the foregoing reasons, we allow this appeal, set aside the judgment and decree of the superior court and in its place substitute therefor judgment in favour of the appellant in the sum of Shs.647,900/= plus interest as prayed in the plaint.
The respondent's counter-claim is dismissed with costs. We award the costs of this appeal and costs of the suit in the superior court to the appellant.
As an appellate court, we have to review and assess the evidence adduced in the trial court in order to determine whether the conclusion reached upon that evidence should stand - see Peter v. Sunday Post Limited [1958] E.A. 424.
Since the respondent admitted that it "did not perform the Nakuru contract" then there was no valid reason why it could be allowed to retain Shs.500,000/= paid to it as a deposit for delivery of furniture to Nakuru Branch of the appellant. That amount should be returned to the appellant.
In our view, there was no evidence to support the counter-claim.
It is true that on 2nd April 1997 the contract had been terminated and was not extended. We did not perform the Nakuru contract by that date
Hence the appellant, quite rightly, sued for a liquidated claim in the sum of Shs.647,900/=. In our view, this claim could not be resisted.
Issues in the judgment
#The coram spells the second judge's surname 'OWOUR' while the signature block reads 'E. OWUOR'; this brief uses 'E. Owuor' consistently throughout.
The quoted paragraph 4 of the plaint states the claim as Kshs.647,000/= whereas the claim is elsewhere stated throughout the judgment as Shs.647,900/=.
The value of furniture delivered at Eldoret is once typed as Shs.352,1000/= but is elsewhere stated as Shs.352,100/=, which is the figure consistent with the Shs.147,900 shortfall.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenya Post Office Savings Bank v Interior Trends Ltd [2001] KECA 35 (KLR)", Case Analysis (2001). Civil Appeal No. 145 of 2000. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2001/35/eng@2001-07-13
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.