Cooperative Bank of Kenya Ltd v Mwangangi (Environment and Land Appeal E012 of 2023) [2026] KEELC 4669 (KLR)

the suit property parcels of land known as Land Parcel title LR No. Machakos Konza North Block 1/1210, Makueni County. ii. A declaration that the Defendant’s actions of advertising the suit property through its authorized agents white Silver Auctioneers being title LR No. Machakos Konza North Block 1/1210, Makueni County together with the building, fittings and improvements therein, for sale by way of public auction, which sale by public auction to be conducted on 18 th November, 2021 is unlawful, unconscionable and illegal. iii. A declaration that the loan facility for the suit property being title LR No. Machakos Konza North Block 1/1210, Makueni County was duly insured. iv. General damages for trespass. v. Costs of this suit together with interest at court rates. vi. Any such other or further relief as this honourable court may deem just and fit to grant. vii. Any other relief this honourable court may deem fit. 4. The case was fully heard and in a judgment delivered on 8 th December, 2023, the trial magistrate granted the following reliefs: a. An order hereby issues of permanent and perpetual injunction restraining Defendant, its agents, servants, employees and/or otherwise howsoever from trespassing, letting, alienating, entering, occupying, residing on, remaining on or otherwise claiming title or interest whatsoever in the suit property or any part thereof and/or in any other way interfering with the Plaintiff’s quiet session of the suit property parcel of land known as LR No. Machakos Konza North Block 1/1210, Makueni County. ELC APPEAL NO. E012 OF 2023 2|Page

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b. A declaration hereby issues that the Defendant’s actions of advertising the suit property through its authorized agents white silver auctioneers being LR No. Machakos Konza North Block 1/1210, Makueni County together with the buildings, fittings and improvements therein, for sale by way of public auction, which sale by public auction to be conducted on 18 th November, 2021 is unlawful. c. A declaration that the loan facility for the suit property being LR No. Machakos Konza North Block 1/1210, Makueni County was duly insured. d. The Plaintiff shall have costs of the suit together with interest. 5. The Appellant was aggrieved with the judgment and preferred an appeal to this court in which it raised the following grounds: 1. That the learned trial magistrate erred in law and in fact when he allowed the Plaintiff’s suit. 2. That the learned trial magistrate erred in law and fact in failing to consider the evidence tendered and the Appellant’s submissions on whether there was a life insurance policy on the loan advanced to the Respondent’s deceased parents. 3. That the learned magistrate erred in law and fact by holding that as per the provisions of the letter of offer, death of a borrower was one of the risks to be covered by the insurance policy. 4. That the learned magistrate erred in law and fact by relying on material not before the court and making assumptions on the original charge document. 5. That the learned magistrate erred in law and fact by misinterpreting provisions of paragraph ‘n’ of the letter of offer dated 24th September, 2010. ELC APPEAL NO. E012 OF 2023 3|Page

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Parties Submissions 6. The parties were directed to file written submissions. The Appellant filed submissions dated 9th December, 2025. The Respondent filed submissions dated 22nd January, 2025. Appellant’s Submissions 7. The Appellant submitted that as the Respondent had pleaded that there was a life insurance policy taken by the deceased. It was upon the Respondent to produce evidence to prove that averment. The Appellant relied on Section 107 and 109 of the Evidence Act which states as follows: 107. Burden of proof 1) Whoever desires any court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts must prove that those facts exist. 2) When a person is bound to prove the existence of any fact it is said that the burden of proof lies on that person. 109. Proof of particular fact The burden of proof as to any particular fact lies on the person who wishes the court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on any particular person. 8. The Appellant submitted that by the trial magistrate stating that it was the Appellant who was supposed to provide evidence of the existence of the life insurance policy, he threw back the burden of proof to the Appellant. It was submitted that the Respondent did not produce any evidence to show that the Appellant had refused to produce the original charge document and that if this was the case, there were other lawful ways of compelling the Appellant to produce the original charge document. ELC APPEAL NO. E012 OF 2023 4|Page

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9. The Appellant submitted further that the decision in Mary Wambui Mutiri –v- Housing Finance HCCC 346 OF 2006 which the trial magistrate heavily relied on was overturned by the Court of Appeal in Housing Finance Company Limited –vs- Mary Wambui Muturi (2018) KECA 751 (KLR). 10.The Appellant further submitted that the trial magistrate made an erroneous finding that there was a life insurance cover without any basis. It was submitted that the trial magistrate rewrote a contract for the parties which had no basis. Reliance was placed in the case of National Bank of Kenya Ltd –vs- Pipeplastic Samkolit (K) Ltd & Another (2002) KECA 362 (KLR) where it was held that a court of law cannot rewrite a contract between the parties. The parties are bound by the terms of their contract, unless coercion, fraud and undue influence are pleaded and proved. 11.The Appellant also submitted that the trial magistrate misinterpreted clause “n” of the letter of offer. It was submitted that this clause only referred to the property being charged and had nothing to do with life insurance policy. It was further submitted that the meaning “of all other risks” in the clause did not include death. 12.The Appellant faulted the trial court’s reliance on the case of Anne N. Permena –vs- Finance Company of Kenya Ltd (2015) eKLR to the effect that the Appellant was estopped from denying the existence of a life insurance policy. It was contended that in the Anne Parmena case (Supra), the offer letter clearly stated that life insurance policy was to be taken. Respondent’s Submissions 13.The Respondent submitted that the trial magistrate made correct findings. He submitted that the Respondent was required to have a comprehensive insurance cover before the loan could be disbursed. It was further submitted that the Appellant refused to provide the original charge and that the court should make an inference that if such charge was to be produced, it was ELC APPEAL NO. E012 OF 2023 5|Page

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going to be adverse to the evidence of the Appellant. Reliance was placed in the case of Chase Bank (Kenya) Limited –vs- Cannon Assurance (K) Ltd Civil Appeal No. 11 of 2011 where it was held as follows: “Generally, it is the duty of a party to argue his case with the best evidence available which can throw light on the controversy at hand. Furthermore, the onus is upon the party in whose custody the best evidence is to produce he document notwithstanding the question of burden. The provisions under Section 112 of the Evidence Act, clearly state that: ‘In civil proceedings, when any fact is especially within the knowledge of any party to those proceedings, the burden of proving or disproving that fact is upon him’. Generally, it is the duty of a party to argue his case with the best evidence available which can throw light on the controversy at hand. Furthermore, the onus is upon the party in whose custody the best evidence is to produce the document notwithstanding the question of burden”. 14.Further reliance was placed in the case of Kenya Akiba Micro Finance Limited –vs- Ezekiel Chebii & 14 others (2012) eKLR. 15.The Respondent finally submitted that the Appellant was wrong in sending notices to the deceased and that this was unprocedural. Reliance was paced on the case of Okeyo & 2 Others (suing as the administrators to the Estate of Andrew Odongo Okeyo (deceased) –vs- Kenya Deposit Insurance Corporation as liquidator of Thabiti Finance Ltd (In liquidation) Civil case No. 5 of 2021 (2023) KEHC 2445 (KLR) where it was held as follows: “To answer the question whether the Defendant applied the proper procedure in law in serving the statutory notices, the answer is in the negative. First, before sending the 90 days statutory notice and the 45 days redemption notice to Gilbert Okeyo, the Defendant had to first ELC APPEAL NO. E012 OF 2023 6|Page

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seek leave of the court which it did not. Secondly, the statutory notices were sent to deceased persons as opposed to the estate of deceased persons were invalid. Hence, the Defendant’s right to exercise its statutory power of sale, cannot be said to have crystalized”. Analysis and Determination 16.I have considered the evidence adduced before the trial court, the grounds of appeal as well as the submissions by the parties. The duty of the first appellate court was stated in the case of Selle and Another –vs- Associated Motor Boat Co. Ltd & Others (1968) EA 123 as follows: “.....An appeal to this court from a trial by the High Court is by way of retrial and the principles upon which this court acts in such an appeal are well settled. Briefly put they are that this court must reconsider the evidence, evaluate it itself and draw its own conclusions though it should always bear in mind that it has neither seen nor heard the witnesses and should make allowance in this respect. In particular this court is not bound necessarily to follow the trial judge’s findings of fact if it appears either it has clearly failed on some point to take account of particular circumstances or probabilities materially to estimate the evidence of if the impression based on the demeanor of a witness is inconsistent with the evidence in the cases generally”. 17.The only issue for determination is whether there was a life insurance policy by the deceased. The contention of the Respondent in the lower court was that there was a life insurance policy which was taken by the deceased and that the outstanding loan should have been cleared by the insurance. This assumption was based on clause ‘n’ of the letter of offer which stated as follows: ELC APPEAL NO. E012 OF 2023 7|Page

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“The borrower shall undertake to furnish the bank with comprehensive insurance policies covering all risks and other peril for all borrower’s assets and property(ies) charged to the bank renewal annually from the Bank’s approved insurance companies and with bank’s interest noted on the policies. In the event that this is not complied with the bank shall arrange for the same and shall debit the relevant charges to the borrower’s account”. 18.A plain interpretation of the clause clearly shows that the comprehensive insurance policies specifically referred to cover for all risks and other perils for all the borrowers and assets charged to the Appellant. There was no mention or reference to any life insurance policies unlike in the cases which the trial magistrate referred to in his judgment where there were specific clauses requiring life insurance policies. 19.The trial magistrate was plainly wrong in making an assumption that the death of the deceased constituted a risk to the loan facility. There was absolutely no basis of making this erroneous assumption when there was no evidence to support the same. 20.It was the Respondent who was alleging that there was a life insurance policy in place. The burden was on him to prove that there was such a policy. The burden of proof did not shift to the Appellant to provide the proof. There was therefore no basis for making an adverse inference that as the Appellant did not bring the original charge, that meant that there was a life policy by the deceased. 21.The Respondent should have produced evidence to show that the deceased were paying premiums and or show that the Appellant was paying on their behalf and debiting their loan accounts. Disposition 22.From the above analysis, it is clear that the trial magistrate was wrong in making an assumption that clause ‘n’ under the covenants covered all risks ELC APPEAL NO. E012 OF 2023 8|Page

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which included death. I allow the appeal, set aside the judgement of 8 th December, 2023 in its entirety and in place thereof make an order dismissing the Respondent’s suit in the lower court with costs. The Appellant shall have costs of this appeal. ................................................ HON. E. O. OBAGA, FCIArb JUDGE JUDGMENT SIGNED, DATED AND DELIVERED VIA MICROSOFT TEAMS THIS 23RD DAY OF JULY, 2026. IN THE PRESENCE OF: Mr. Akenga for Respondent Ms. Kioko for Mr. Mulwa for Appellant. Court assistants – Kilonzo and Musyoki ELC APPEAL NO. E012 OF 2023 9|Page

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