Mbaluka t/a Mmawo v Sidian Bank Limited & another (Civil Case E110 of 2023) [2025] KEMC 306 (KLR)
The bottom line
#A Kenyan court ruled that withdrawing a lawsuit doesn't avoid costs—the plaintiff who filed while in loan arrears must pay the defendants' legal costs.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether costs of the suit are payable and, if so, by whom, following the withdrawal/settlement of the suit
Key legal issues
#Whether costs are payable and by whom where the suit is withdrawn as settled without trial
Costs were awarded to the defendants. The suit was effectively withdrawn, not heard on merit, so there was no successful party in the strict sense, but the plaintiff's conduct—filing suit while in loan arrears, obtaining ex parte injunction orders and using the suit to buy time to clear the loan—gave no good reason to depart from the rule that costs follow the event.
Section 27 of the Civil Procedure Act confers discretion on the court, with the default rule that costs follow the event. The discretion must be exercised judicially and reasons given for departing from the general rule. Although the matter was withdrawn rather than decided on merit, the plaintiff instituted suit while the loan was in arrears, kept it in court over two years, and obtained interlocutory relief that bought time to clear the loan. Denying the defendants, who incurred counsel and court fees, their costs would be unfair; the Pacis Insurance authority supports awarding costs to a defendant upon withdrawal.
Legal principles established
#- Costs are in the discretion of the court and follow the event unless the court, for good reason, otherwise orders; where the court departs from the general rule it must give reasons patent on record.
- A defendant caused to participate in a suit that is later withdrawn is entitled to costs incurred in defending it, unless the parties agree otherwise or the court in the exercise of its discretion decides otherwise.
Court orders
#- 1.Costs of the suit awarded to the defendants, to be borne by the plaintiff
- 2.Parties at liberty to agree on the costs payable; in default of agreement, the defendants to follow the procedure under Order 21 rules 9A to 9D of the Civil Procedure Rules
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- Jurisdiction invoked
- Section 27 of the Civil Procedure Act (discretion over costs of and incidental to suits)
Relief refused
#Plaintiff's request that the matter be closed with no orders as to costs (each party bearing own costs)
The court found the plaintiff's failure to service the loan necessitated the suit and there was no good reason to depart from the general rule that costs follow the event
Costs
Costs awarded to the defendants, to be borne by the plaintiff; parties at liberty to agree on the amount, failing which the defendants to proceed under Order 21 rules 9A–9D of the Civil Procedure Rules.
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.
In view of the foregoing, I award costs to the defendants. The same shall be borne by the plaintifi. Parties are at liberty to agree on the costs payable and if there is no agreement, the defendants shall follow the procedure laid down under Order 21 rule 9A through to 9D of the Civil Procedure Rules.
This matter was not heard on merit. It cannot therefore be said that there is a successful party in the strict sense of the phrase.
The court retains the discretion on whether or not to award costs and by whom and to what extent such costs are to be paid
It is the plaintifi who dragged the defendants to court. It is not in doubt that the defendants incurred costs in engaging counsel and in court fees.
Issues in the judgment
#The judgment refers to the plaintiff inconsistently by gender, using both feminine and masculine pronouns for the same party.
The suit number/case number is not disclosed anywhere in the judgment as extracted.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Mbaluka t/a Mmawo v Sidian Bank Limited & another (Civil Case E110 of 2023) [2025] KEMC 306 (KLR)", Case Analysis (2025). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/kemc/2025/306/eng@2025-12-10
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.