South Nyanza Company Ltd v Malova

argued that the award of interest lacked a legal basis and a specied commencement date, and that the trial court failed to dismiss the suit despite alleged deciencies in the pleadings and evidence indicating that the respondent was the party in breach of the contract. 4. Upon re-evaluating the evidence, the 1st appellate court (Mrima, J.), in the now impugned judgment delivered on the 28th November 2019, found no legal or factual basis to interfere with the trial court's decision and consequently dismissed the appeal with costs to the respondent. 5. Once again being aggrieved by the judgment and decree of the High Court, the appellant lodged this second appeal raising 10 grounds of appeal most of which are repetitive. Before addressing the merits of the appeal, we nd it prudent to point out the requirements of rule 88(1) of the Court of Appeal Rules, which mandates that a memorandum of appeal be drafted concisely and set out distinct grounds of appeal without argument or narrative as an excessive number of repetitive or irrelevant grounds does not strengthen an appeal. 6. The appellant nonetheless impugned the judgment on the grounds that the learned judge erred in law by: failing to appreciate that the respondent's evidence was inconsistent with his pleadings; nding the appellant liable for breach of a sugarcane farming contract without sucient evidence; relying on a purported contract dated 15th April 2008 which allegedly did not exist; awarding Kshs. 167,200 based on an unproved cane price of Kshs.3,000 per tonne; nding that the respondent had maintained the rst ratoon crop to maturity and that the appellant failed to harvest it despite insucient evidence; awarding damages for two crop cycles contrary to the principles governing special damages; holding that the Respondent had no duty to mitigate his losses; awarding interest from the date of ling suit; and failing to independently evaluate the evidence by instead relying on ndings in similar sugarcane cases. The appellant therefore prayed that the judgment by the High Court be set aside; dismissal of the respondent's suit; and an award of costs of the proceedings in both the High Court and this Court. 7. The appeal was to be canvassed by way of written submissions. Despite a prior notice of non-compliance, Mr. Odero Counsel for the appellant stated at the plenary hearing that the submissions had been led. However, from the documents led before this Court, we note that the submissions on record are not in relation to this particular le. That notwithstanding, we shall proceed to consider this appeal on its merit. 8. This being a second appeal, the law is settled that this Court is conned to dealing with issues of law only unless it is demonstrated that the courts below considered matters, they ought not to have considered or failed to consider matters they ought to have considered, or that the decision was perverse. This was articulated by this Court in Charles Kipkoech Leting v Express (K) Ltd & another [2018] eKLR as follows: “ Our mandate is as has been enunciated in a long line of cases decided by the Court. See Maina versus Mugiria [1983] KLR 78, Kenya Breweries Ltd versus Godfrey Odongo, Civil Appeal No. 127 of 2007, and Stanley N. Muriithi & Another versus Bernard Munene Ithiga [2016] eKLR, for the holdings inter alia that, on a second appeal, the Court connes itself to matters of law only, unless it is shown that the Courts below considered matters, they should not have considered or failed to consider matters they should have considered or looking at the entire decision, it is perverse. See also the English case of Martin versus Glywed Distributors Ltd (t/a MBS Fastenings) 1983 ICR 511 where in, it was held inter alia that, where a right of appeal is conned to questions of law only, an appellate court has loyalty to accept the ndings of fact of the lower court (s) and resist the temptation to treat ndings of fact and law, and, it should not interfere with the decisions of the trial or rst appellate https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1970/eng@2026-09-25 2

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court unless it is apparent that, on the evidence, no reasonable tribunal could have reached that conclusion, which would be the same as holding the decision is bad in law.” 9. From the memorandum of appeal this Court is called upon to determine the following issues; a. Whether the learned judge decided the appeal based on issues not properly raised in the appeal. b. Whether the learned judge relied on material which was not properly on record. c. Whether the respondent proved his case on a balance of probabilities. d. Whether the award of damages was justied in the circumstances. e. Whether the award of interest was lawful. 10. We note that this Court is invited to re-analyze the facts leading up to the decision by the 1st appellate court, which in our considered view amounts to a consideration of issues of facts which are beyond the jurisdiction of this Court sitting on second appeal. Nonetheless we shall proceed to consider the grounds of appeal and the submissions. From the record, the learned judge observed that the appellant had departed from its pleaded defence by introducing an unpleaded allegation that the farmer had failed to properly maintain the ratoon crop and as parties are bound by their pleadings, the Court rejected the contradictory evidence. The Court further noted that the appellant failed to produce any warning letters or other evidence showing that the farmer had been notied of poor crop maintenance, thereby arming the nding that it was the Appellant who breached the contract. Relying on established precedent, the Court reiterated that where a miller fails to harvest a mature crop, the farmer is entitled to compensation for the plant crop and any ratoon crops lost as a consequence of the initial breach. Consequently, the award for two ratoon crop cycles was upheld. We see no lawful reason to depart from this nding made by the 1st appellant Court. 11. In relation to mitigation of loss, the Court held that the burden of proof rested on the appellant and, having failed to adduce evidence demonstrating how the respondent could reasonably have mitigated the loss, that ground of appeal failed. Regarding cane yield, the Court upheld the trial court's reliance on the independent yield assessment prepared by KESREF, nding it more credible than the appellant's own internal reports. As regards interest, the learned judge armed that damages awarded for breach of contract constitute special damages and therefore attract interest from the date of ling suit rather than from the date of judgment. 12. In considering whether the learned judge determined the appeal on impermissible not pleaded issues, the learned judge’s obligation as the 1st appellate court was to re- evaluate the evidence de novo. It is also evident from the record that the learned judge’s decision was based on material that were initially properly placed before the trial court and to the contrary it was the appellant who introduced evidence that departed from its pleadings. This Court has pronounced itself on exactly this question in a related case, South Nyanza Sugar Company Limited v Mboga [2025] KECA 546 (KLR), where regarding exactly the same complaint by the appellant against similarly-phrased appeal we stated thus: “ Looking at the two issues raised on rst appeal, it seems eminently obvious that the learned Judge determined the appeal on issues that were raised, and in exercise of his obligation to re-evaluate the evidence de novo. The question whether the learned magistrate had wrongly analyzed the evidence; and whether the learned magistrate had deployed a standard of proof unknown in law were both before the learned Judge as they are before us. The learned Judge https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1970/eng@2026-09-25 3

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ruled that the learned magistrate’s analysis was wrong; and the adopted standard of proof that required documentary proof to succeed in a claim for breach of contract was similarly wrong. We do so as well.” 13. The appellant argued that the respondent herein ought to have mitigated his loss or replanted alternative crops; and that the learned judge erred in law when he held, without evidence, and on the basis of his prior holding in other cases, that the respondent had no duty, or obligation, in the circumstances of the contract between the parties, to mitigate his losses, if at all any, when termination of the contract, and contracting, or selling that cane, when mature, to another miller, or into the open market, was an option ever open to the respondent; that the respondent was aware of these options.; and that the learned judge erred by applying a lower standard of proof than the balance of probabilities, eectively accepting uncorroborated assertions as sucient proof of breach of contract. This was an approach that had been advanced in Jael A. Omolo v. South Nyanza Sugar Co. Ltd [2019] eKLR (A.K. Ndung’u, J.), where the court emphasized the necessity of cogent evidence to prove that cane was planted, matured, and was not harvested such as expert reports, photographs, or eyewitness testimony. However, this reasoning has been neutralized by this Court in South Nyanza Sugar Company Ltd v Mary Anyango (Suing as Administratrix of the Estate of Jared Onyango Onguka (Civil Appeal No. 171 of 2019) [2024] KECA 694 KLR (21 June, 2024) (Judgment), where this Court in addressing the attempted conation of the duty to mitigate damages and the alleged failure to produce evidence of breach of contract to the required standard stated thus: “ The view that the respondent, on record, satised her burden of proof is fortied by looking at Clause 11 of the Agreement between the parties. While the appellant has heavily relied on the decision of Chitembwe, J. (as he then was) in South Nyanza Sugar Company Ltd vs. Francis Aderi Dedege (supra), wherein he held that it was the outgrower’s responsibility to inform the sugar company Page 21 of 26 when the ratoon crop was ready and that the failure of a farmer to prove that they did so is fatal to a claim of this nature, Clause 11 of the Agreement between the parties provides as follows: The wording of the said clause clearly indicates that there are scheduled visits by the Company to the farmer’s shamba and notication thereof of the farmer by the Company of any works or operations that may be required to be done. Therefore, it goes without saying that it was the duty of the appellant to inform the respondent or his representative of the appointed date of each harvesting or any other works or operations. This is to say, according to the wording of the contract, it was not the duty of the respondent to notify the appellant that the plant crop or the rst ratoon was ready for harvesting. The contract reveals that there is a system developed by the appellant to ensure scheduled and/or follow up visits to the farmer’s shamba to ensure that the farmer has maintained, cultivated and tended his shamba for purposes of obtaining satisfactory yield. It is telling that despite that elaborate system, the appellant did not have any evidence whatsoever to demonstrate that the respondent had failed to maintain the shamba satisfactorily; or that it had valid reasons to rescind its contract with the farmer on account of breach of contract on her part.” 14. We need not say more, the appellant failed to sustain its defence with the result that the respondent had proved his case on a balance of probabilities and thus merited the damages awarded. 15. As regards the issue of interest, the appellant contended that the learned Judge erred in holding that the issue of interest on the principal award of Kshs.167, 200/- was to be reckoned from the date of the delivery of the judgment and not from the date of ling suit, was a matter of fact, which was to be pleaded in the appellant's response to the respondent's claim before the subordinate court, and https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1970/eng@2026-09-25 4

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evidence taken thereon, when all the material that he could have relied on in determining the issue was on record in the appeal. This Court has severally held on the need to refrain from interference with a trial judge’s exercise of discretion unless it is satised that the lower court proceeded upon some erroneous principle or was plainly and obviously wrong. 16. We have read section 26 of the Civil Procedure Act which provides as follows: Where and in so far as a decree is for the payment of money, the court may, in the decree, order interest at such rate as the court deems reasonable to be paid on the principal sum adjudged from the date of the suit to the date of the decree in addition to any interest adjudged on such principal sum for any period before the institution of the suit, with further interest at such rate as the court deems reasonable on the aggregate sum so adjudged from the date of the decree to the date of payment or to such earlier date as the court thinks t. Where such a decree is silent with respect to the payment of further interest on such aggregate sum as aforesaid from the date of the decree to the date of payment or other earlier date, the court shall be deemed to have ordered interest at 6 per cent per annum. 17. The section is explicit that the court has discretion to award interest on the principal sum where the decree is for the payment of money and further that the court has discretion to determine the appropriate rate of such interest. None of the limitations the appellant urges us to impose are found in the statutory provision. This was a liquidated claim based on a breach of contract. There is absolutely no justication to limit the interest payable on account of the fact that the ultimate amount payable was not specically determinable at the time of ling suit. 18. We rest this matter on interest by echoing the words of the Court in New Enterprises Tyres Ltd vs. Kenya Alliance Insurance Company Ltd [1988] eKLR that: “ …it is evident from the reading of this provision that the Court enjoys a wide measure of discretion on the question of interest. And being an appeal against a trial judge’s exercise of his discretion this Court is enjoined to treat the original decision with the utmost respect and should refrain from interference with it unless it is satised that the lower court proceeded upon some erroneous principle or was plainly and obviously wrong.” 19. In our view, this is the correct position in law; and we have no reason to fault the learned judge’s application of his discretion in the award of interest. See also the case of South Nyanza Sugar Company Ltd v Lawi [2025] KECA 1G11 (KLR). Taking all the aforementioned into consideration, we nd no reason to depart from the ndings of Mrima J. We also do not nd any consideration of matters that were perverse or not placed before the 1st appellant Court that were improperly determined. 20. We thus hold that the nding of the High Court was based on proper appreciation of the law and evidence. Accordingly, we nd no merit in this appeal which is hereby dismissed. As regards costs, we note that the respondent did not participate in these proceedings and as such we shall make no orders on costs. DATED AND DELIVERED AT KISUMU THIS 25TH DAY OF SEPTEMBER, 2026. ASIKE-MAKHANDIA ....................................... JUDGE OF APPEAL https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1970/eng@2026-09-25 5

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H. A. OMONDI ....................................... JUDGE OF APPEAL L. KIMARU ....................................... JUDGE OF APPEAL I certify that this is a true copy of the original. Signed DEPUTY REGISTRAR https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1970/eng@2026-09-25 6

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