Kabuito Contractors Limited v Mereka t/aMereka & Co Advocates [2003] KECA 186 (KLR)
The bottom line
#Kenya's Court of Appeal ruled judges can stop a party using a counterclaim at trial but cannot strike it out of the case record.
What this practically means
#Executive summary
#Key legal issues
#Whether rules 2 and 11 of Order VIII of the Civil Procedure Rules are inconsistent, and the respective situations to which each applies
The rules are not inconsistent. Rule 2 applies only as between a plaintiff and a defendant, with the application made before trial on the grounds that the counterclaim cannot be conveniently disposed of in the pending suit or ought not to be allowed. Rule 11 applies where the defendant has joined other parties to the counterclaim; the application is made before filing a reply, on the ground that the claim ought to be disposed of in an independent suit.
The court read rule 2 alongside rules 7 to 10 of Order VIII. Rule 2 contemplates only two parties, plaintiff and defendant, and an application before trial. Rules 7 to 10 recognise that a defendant may join to his counterclaim persons other than the plaintiff, who must be served and may appear and reply. Rule 11 then gives the plaintiff or any such joined person, at any time before reply, the right to seek exclusion of the counterclaim into an independent suit, with the court free to make any just order. The rules therefore govern different situations and cannot conflict.
What order a court may make on a plaintiff's application under Order VIII rule 2
The court's only power under rule 2 is to refuse the defendant permission to avail himself of the set-off or counterclaim; there is no power to strike the counterclaim out, and the counterclaim remains on the record but cannot be relied upon.
The language of rule 2 confines the court to refusing permission where the counterclaim cannot be conveniently disposed of in the pending suit or ought not to be allowed. Striking out is a different remedy not found in the rule. Because Khamoni J's order stated that the counterclaim was excluded and/or struck out, the Court of Appeal held he had exceeded what rule 2 permits and amended the order so that it recorded a refusal of permission, leaving the counterclaim on the record but unavailable to the defendants.
Whether section 49 of the Advocates Act applied so as to entitle the advocate to directions that his bill of costs be filed and taxed
Section 49 applies only where there is no agreement between advocate and client on remuneration and where the client, in his defence, disputes merely the reasonableness or quantum of the costs claimed. Here the client pleaded an express agreement capping fees and a total denial of liability, so section 49 did not apply and the judge was right to reject prayer 2 of the motion.
The appellants' defence pleaded that the respondent was to take no action unless his fees were first agreed, that fees were limited to Kshs 225,000 with a further fee to be negotiated, and that only an interim fee note totalling Kshs 330,800 was rendered. Those averments alleged an agreement and amounted to a total denial that any money was owed, not a challenge to reasonableness or quantum. Whether the averments were true was beside the point at that stage; section 49 simply had no application, so the cross-appeal failed.
Whether the Court of Appeal could interfere with the trial judge's conclusion that the counterclaim could not be conveniently disposed of in the pending suit
It could not. That conclusion was an exercise of discretion, and no breach of the Mbogo v Shah principles governing interference with a trial judge's exercise of discretion was shown.
Counsel for the appellants argued, as a last effort, that even if the judge's interpretation of rules 2 and 11 was right, the judge was not entitled on the material before him to conclude that the counterclaim could not be conveniently disposed of in the suit. The court answered that the judge was exercising a discretion on that point, and that no breach of the injunctions in Mbogo v Shah on the exercise of discretion and appellate interference had been demonstrated. That ground therefore failed and the appeal against the order was dismissed.
Legal principles established
#- On a plaintiff's application under Order VIII rule 2 of the Civil Procedure Rules, made before trial, the only order the court may make is to refuse the defendant permission to avail himself of the set-off or counterclaim; the court has no power to strike out the set-off or counterclaim.
- Rules 2 and 11 of Order VIII are not inconsistent: rule 2 governs applications between plaintiff and defendant made before trial, while rule 11 governs applications, made before filing a reply, by the plaintiff or any party joined to a counterclaim, in which the court may make any order it deems just.
- Section 49 of the Advocates Act applies only where there is no agreement between advocate and client on remuneration, and where the client in his defence disputes merely the reasonableness or quantum of the costs claimed by the advocate.
- An appellate court will not interfere with a trial judge's exercise of discretion, including a finding that a counterclaim cannot be conveniently disposed of in the pending suit, absent a breach of the principles in Mbogo v Shah.
Court orders
#- 1.The High Court judge's order amended to state that the appellants are refused permission to avail themselves of their counterclaim; the counterclaim remains on the record but the appellants shall not be entitled to rely on it
- 2.The appellants' appeal dismissed, with three quarters of the costs thereof to the respondents
- 3.The respondent's cross-appeal dismissed, with costs thereof to the appellants
- On appeal from
- High Court
- Jurisdiction invoked
- Not stated in the judgment; a first appeal (with a cross-appeal) from the High Court to the Court of Appeal
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kabuito Contractors Limited v Mereka t/aMereka & Co Advocates [2003] KECA 186 (KLR)", Case Analysis (2003). Civil Appeal No 240 of 2001. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2003/186/eng@2003-07-11
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.