General Printers Limited v Savichem Africa Limited
The bottom line
#Kenya's Court of Appeal confirmed that a 3% monthly interest clause in invoices is enforceable, and courts won't rescue parties from bad bargains.
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 respondent specifically pleaded and proved its claim for special damages
- 2.Whether the superior court erred in holding that there was an agreement to charge 3% interest per month for delayed payments and whether the same was excessive or unconscionable
- 3.Whether, as a result of the mediation/negotiations between the parties, there was a separate agreement that superseded the previous agreement, and whether the credit facility absolved the appellant from paying interest due on delayed payments
Key legal issues
#Pleading and proof of the special damages claim for interest
The claim was specifically particularized in the plaint and proved on a balance of probabilities through duly executed proforma invoices, invoices and delivery notes
The plaint particularized the special damages claim, and documentary exhibits (proforma invoices, invoices, delivery notes) were tendered without objection and acknowledged by both parties as containing the contract terms. Being a civil claim, proof was on a balance of probabilities, which the respondent discharged.
Whether the 3% monthly interest rate was agreed, and whether it was excessive or unconscionable
The 3% rate was a term of the parties' agreement and was neither excessive nor unconscionable; courts cannot rewrite a validly executed contract
Both parties admitted the rate was provided for in the proforma invoices and invoices. Following National Bank of Kenya v Pipeplastic Samkolit and Bawazir Glassworks, equity relieves against a bad bargain only in exceptional circumstances, and the appellant failed to meet that threshold.
Whether the mediation/credit facility superseded the original agreement's interest clause
No superseding agreement was proved, and the issue was neither pleaded nor framed for trial, so it could not be raised on appeal
The superseding-agreement issue was not among the issues agreed for trial determination, was not pleaded in the defence (which itself referenced the facility), and the appellant's witness did not advance it. Under Gandy and Galaxy Paints, parties are confined to pleaded and framed issues.
Legal principles established
#- A first appellate court may re-evaluate and re-analyse the record and reach its own conclusion, while bearing in mind the trial judge's advantage of seeing and assessing witness demeanour
- An appellate court will not interfere with a finding of fact unless it is based on no evidence, on misapprehension of the evidence, or on a demonstrably wrong principle
- Courts have no mandate to rewrite a duly and validly executed contract; equity relieves a party from a bad bargain only in exceptional circumstances
- Cases must be decided on the issues on the record; a party who fails to plead or frame an issue cannot raise it on appeal
Court orders
#- 1.The appeal was dismissed in its entirety
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court of Kenya
- HCCC Case No. 87 of 2017
- Jurisdiction invoked
- First appeal to the Court of Appeal under the Court of Appeal's appellate jurisdiction (first appeal on facts and law)
Relief refused
#Appellant's request that the finding on the 3% interest agreement be overturned
The agreement was discernible from duly executed proforma invoices and invoices; the claim was proved on a balance of probabilities
Appellant's plea that the 3% interest rate was unconscionable and should be vitiated
Only in exceptional circumstances would equity relieve a party from a bad bargain; the threshold was not met
Appellant's contention that the Credit Bank facility payment was in full and final settlement superseding the interest clause
The superseding-agreement issue was neither pleaded nor framed as an issue for trial determination
Costs
No costs order was made in the judgment; the appeal was simply dismissed. (At trial, the respondent's claim had been allowed with costs.)
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.
This being a rst appeal, the position in law is that we are entitled to re-evaluate and re-analyze the record and come to our own conclusion, bearing in mind that the trial Judge had the advantage of seeing and assessing the demeanor of witnesses.
courts of law have no mandate to rewrite a contract duly and validly executed by parties and therefore binding on them a threshold which in our view, has not been met by the appellant to entitle us tamper with the clear terms of the contract.
Cases must be decided on the issues on the record; and if it is desired to raise other issues they must be placed on the record by amendment.
On the basis of the totality of the above assessment and reasoning, we nd no basis for us to interfere with the learned Judge’s decision. The upshot is therefore that this appeal has no merit and is therefore dismissed.
Issues in the judgment
#The case name of the seminal first-appeal authority is rendered inconsistently within the judgment ('Associated Boat Company' vs 'Associated Motor Boat')
No express costs order appears in the final orders despite the dismissal of the appeal
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "General Printers Limited v Savichem Africa Limited", Case Analysis (2022). Civil Appeal 295 of 2019. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2022/580/eng@2022-04-28
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.