Andrew Leteipa Sunkuli & another v Southern Credit Banking Corporation [2017] KECA 587 (KLR)
The bottom line
#Kenya's Court of Appeal restored the Sunkulis' right to defend a land-sale lawsuit, ruling clients shouldn't lose their day in court over a lawyer's mistake.
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 failure by the appellants to file a defence was an excusable or inadvertent mistake of counsel
- 2.Whether the draft defence raised triable issues entitling the appellants to a full hearing
- 3.Whether the learned Judge exercised his discretion judicially in refusing to set aside the ex-parte judgment
Key legal issues
#Exercise of discretion to set aside ex-parte judgment
The learned Judge failed to exercise his discretion judicially by disregarding counsel's sworn explanation and considering extraneous matters, thereby punishing the appellants for no fault of their own
The Judge did not mention Mr Kairu's sworn explanation that the notice may have been misplaced during the merger of his firm, and instead considered why the settlement negotiations had stalled, which was irrelevant to the excuse for non-filing. The Judge also failed to consider the first appellant's affidavit. The discretion under Mbogo v Shah must foster justice; denying a hearing on a triable defence was wrong in principle, and any prejudice could have been met by costs.
Existence of triable issues
The draft defence raised triable issues, namely liability of a buyer in possession before completion and the applicable interest rate, which required evidence at trial
The Judge himself had framed the question whether a buyer given possession before completion should escape payment for the pre-completion period; that was triable. The interest rate too required evidence, since the LSK conditions of sale pegged unspecified interest at 2% above the maximum bank rate, requiring proof of prevailing market rates at the accrual date.
Regularity of the ex-parte judgment
The ex-parte judgment was prima facie regular because the respondent complied with the agreed notice procedure before entering judgment
Respondent's counsel gave the agreed ten-day notice after negotiations broke down, ensured its receipt and entry in the delivery book, and waited for a defence before requesting judgment. The irregularity lay not in obtaining judgment but in the Judge's refusal to consider the reasons for default; such prejudice as existed was curable by thrown away costs.
Legal principles established
#- The discretion to set aside an ex-parte judgment is unfettered but must be exercised judicially to foster, not suppress, justice
- In an application to set aside an ex-parte judgment the court must consider both the reasons for default and whether the defence raises triable issues
- A client should not be penalised for counsel's inadvertent mistake where a triable defence exists; the court may instead set aside the ex-parte judgment on terms such as thrown away costs
Court orders
#- 1.Appeal allowed and the impugned ruling set aside
- 2.Ex-parte judgment entered on 5th August 2002 and all consequential orders set aside
- 3.Appellants to pay the respondent thrown away costs of Ksh. 20,000/= before filing the defence
- 4.Defence to be filed and served within fifteen (15) days of the judgment, failing which the ex-parte judgment is automatically restored
- 5.Costs of the appeal to be costs in the suit and abide the outcome thereof
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. 394 of 2002
- Jurisdiction invoked
- First appeal to the Court of Appeal under the applicable appellate jurisdiction over the High Court (statutory appeal; no specific provision cited in the judgment)
Relief refused
#Costs of the appeal against the respondent
The respondent was not at fault in respect of the entry of the ex-parte judgment, so appeal costs were made costs in the suit
Costs
Appellants to pay thrown away costs of Ksh. 20,000/= before filing the defence; costs of the appeal to be costs in the suit and abide the outcome thereof
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.
Whether to set aside such a judgment or not is purely at the discretion of the court. This discretion is unfettered but it must be exercised judicially, and in a manner that will foster rather than suppress justice.
We allow the same and set aside the impugned ruling with the result that the ex-parte judgment entered against the appellants on 5th August, 2002 and all other consequential orders are hereby set aside.
We nonetheless order that the appellants pay the respondent thrown away costs of Ksh. 20,000/= before the filing of the defence, which defence must be filed and served within fifteen (15) days from the date of this judgment; failing which the ex-parte judgment will be automatically restored.
the court must consider not only the reasons why the defence was not filed or for that matter why the applicant failed to turn up for hearing on the hearing date but also whether the applicant had reasonable defence
If their advocate needed to be penalised for his inaction in the matter, there were other remedies open to the Judge to deal with that, rather than shut out the appellants completely, and slam the door of justice on their face.
Issues in the judgment
#The judgment inconsistently describes the notice period for filing the defence, referring at different points to fourteen (14) days, ten (10) days and thirty (30) days
The case name of the East African authority is cited inconsistently in the same judgment (Mbogo vs Shah and Shah vs Mbogo)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Andrew Leteipa Sunkuli & another v Southern Credit Banking Corporation [2017] KECA 587 (KLR)", Case Analysis (2017). Civil Appeal No. 191 of 2009. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2017/587/eng@2017-03-24
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.