Mwangi v Gakinya t/a Hari Gakinya & Company Advocates

5. The Plainti further testied that, as security for the money advanced, the Defendant gave her the original logbook for motor vehicle registration number KBP 298E, together with a copy of his KRA PIN and a Motor Vehicle search. 6. The Plainti subsequently discovered that the motor vehicle did not belong to the Defendant but to a third party, one Dysseleer Mireille, who had subsequently been murdered. The Plainti stated that ocers from the Criminal Investigations Department later visited her oce and took possession of the logbook in connection with investigations concerning the motor vehicle. 7. The Plainti further testied that, in an attempt to settle the debt, the Defendant issued four cheques totalling Kshs.2,700,000.00. Two of the cheques, amounting to Kshs.1,700,000.00, were presented for payment but were dishonoured for insucient funds. The remaining two cheques, numbers 000363 and 000364, were undated and amounted to Kshs.1,000,000.00. 8. The Plainti's case is that despite the agreement and the Defendant's subsequent conduct acknowledging the debt, he failed and/or refused to repay the amount due, thereby necessitating the institution of these proceedings. The Defence 9. The Defendant entered appearance and led an Amended Statement of Defence dated 7 October 2020. He generally denied the Plainti's claim and prayed that the suit be dismissed with costs. 10. The Defendant denied that he and the Plainti were socially acquainted or that they had previously engaged in friendly nancial transactions. He denied receiving the Kshs.1,000,000.00 alleged by the Plainti. 11. Signicantly, however, the Defendant did not deny that Kshs.1,500,000.00 had been transferred by the Plainti to the account of Hari Gakinya & Co. Advocates on 19 February 2019. His explanation was that the money had been requested through Mr. Kamau Kihoge and was advanced in connection with the law rm. 12. The Defendant denied that there was an agreement requiring repayment of Kshs.2,500,000.00 together with an additional Kshs.200,000.00. He further denied the Plainti's allegations concerning the motor vehicle Logbook and maintained that the cheques issued to the Plainti were merely security for the Kshs.1,500,000.00 13. The Defendant further contended that the Kshs.1,500,000.00 was not immediately repayable but was being held as security pending the conclusion of Nairobi HCCR Criminal Case No. 10 of 2020. 14. The Plainti led a Reply to Defence dated 9 November 2020, thereby joining issue with the Defendant. Hearing 15. At the hearing, the Plainti testied as PW1 and adopted her Witness Statement as her evidence in chief and produced the documents contained in her list of documents as exhibits. 16. The Plainti's evidence was supported by documentary material relating to the nancial transactions and the cheques issued by the Defendant. 17. The Defendant, despite having led a Defence, did not attend Court for the hearing after being duly served with the hearing notice. He did not cross-examine the Plainti, did not testify and did not call any witness. https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/948/eng@2026-09-23 2

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18. The Defendant's case was consequently closed. 19. The fact that the Defendant did not attend the hearing does not, however, automatically entitle the Plainti to judgment. The Plainti bears the legal burden of proving her case on a balance of probabilities. Plainti's Submissions 20. The Plainti submitted that she had proved her case on a balance of probabilities. 21. Counsel submitted that the Plainti advanced various sums to the Defendant which, together with the agreed additional amount, amounted to Kshs.2,700,000.00. 22. Particular reliance was placed on the Defendant's admission that Kshs.1,500,000.00 had been transferred to the account of Hari Gakinya & Co. Advocates. 23. It was submitted that although the Defendant alleged that the money was held as security in connection with Nairobi HCCR Criminal Case No. 10 of 2020, he produced no evidence to establish that assertion. 24. Counsel further relied on the cheques issued by the Defendant as corroboration of the amount claimed. 25. The Plainti urged the Court to enter judgment for Kshs.2,700,000.00 together with interest and costs. Analysis and Issues for Determination 26. Having considered the pleadings, the evidence on record and the submissions, I consider the following issues to arise for determination: a. Whether there was a valid and enforceable agreement between the Plainti and the Defendant for the advancement and repayment of money; b. Whether the Plainti proved that she advanced Kshs.2,500,000.00 to the Defendant; c. Whether the Defendant's Defence contains an admission concerning receipt of Kshs.1,500,000.00; d. Whether the Plainti proved that the amount agreed to be repaid was Kshs.2,700,000.00; e. Whether the Defendant's allegation that the money and cheques were merely security and that repayment was conditional upon the conclusion of criminal proceedings was proved; f. Whether the Plainti is entitled to interest; and g. Who should bear the costs of the suit. 27. The starting point is Sections 107, 108 and 109 of the Evidence Act, Cap. 80 Laws of Kenya. 28. Section 107(1) provides that: “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.” https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/948/eng@2026-09-23 3

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29. Section 108 provides that the burden of proof in a suit lies on the person who would fail if no evidence at all were given by either side, while section 109 places the burden of proving a particular fact upon the person who wishes the Court to believe in its existence. 30. The applicable standard in civil proceedings is proof on a balance of probabilities. 31. In Charterhouse Bank Limited (Under Statutory Management) v Frank N. Kamau [2016] KECA 153 (KLR), the Court of Appeal emphasised that the failure of a Defendant to call evidence does not, by itself, automatically result in judgment for the Plainti. The Plainti must rst place before the Court credible evidence capable of establishing the claim on a balance of probabilities. 32. Similarly, in Karugi & Another v Kabiya & 3 Others [1987] KLR 347, the Court of Appeal made it clear that the burden of proof does not shift merely because the Defendant has failed to adduce evidence. 33. I shall therefore determine the Plainti's claim on the basis of the evidence tendered, the admissions contained in the Defence, the documentary exhibits and the applicable law, rather than merely on the basis that the Defendant did not testify. Whether there was a Valid and Enforceable Agreement between the Plainti and the Defendant for the Advancement and Repayment of Money 34. The central issue in this suit is whether the Plainti proved the existence of an agreement pursuant to which she advanced money to the Defendant and the Defendant undertook to repay it. 35. The Defendant's case, insofar as it challenges the Plainti's claim, is that there was no agreement for repayment of Kshs.2,700,000.00. The Plainti, on the other hand, relies upon an oral agreement and the subsequent conduct of the parties. 36. The law recognises oral contracts. Section 3 of the Law of Contract Act does not prescribe that every contract must necessarily be in writing. It only requires writing in specied categories of transactions. 37. The High Court in Ibrahim v Mwarania [2023] KEHC 1354 (KLR) correctly observed that section 3(1) of the Law of Contract Act does not render all unwritten contracts void or unenforceable. Oral agreements may therefore be enforceable where their essential elements are proved. 38. More importantly, the Court of Appeal in Ali Abid Mohammed v Kenya Shell & Company Limited [2017] eKLR held that a contract may exist even where no words have been used, where the conduct of the parties demonstrates that a contract has been concluded. 39. The question is therefore not merely whether the parties executed a written agreement. The Court must determine whether their conduct demonstrates an oer, acceptance, consideration, intention to create legal relations and sucient certainty of the essential terms. 40. In William Muthee Muthami v Bank of Baroda [2014] eKLR, the Court of Appeal reiterated that the essential ingredients of a valid contract include oer, acceptance and consideration. 41. The same position was more recently reiterated in Kirui v Korir [2024] KEHC 5608 (KLR), where the Court, relying on the Supreme Court's exposition of contractual principles, observed that a valid and enforceable contract requires evidence of a contractual obligation arising from an agreement, together with the necessary elements of oer, acceptance and consideration. https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/948/eng@2026-09-23 4

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42. Consideration is readily apparent in the present case. The Plainti's consideration was the advancement of the money, while the Defendant's alleged reciprocal obligation was to repay the money within the agreed period together with the additional Kshs.200,000.00. 43. There is also evidence of conduct consistent with an agreement.The Plainti transferred money. The Defendant accepted or beneted from the transaction. He subsequently issued four cheques totalling Kshs.2,700,000.00. Two of those cheques were presented and dishonoured. 44. The issuance of cheques by the Defendant is particularly signicant. It is conduct subsequent to the alleged oral agreement and is consistent with an acknowledgment that there was an obligation to account for and repay money. 45. The Defendant's own pleading also acknowledges the transfer of Kshs.1,500,000.00 by the Plainti to the account of Hari Gakinya & Co. Advocates. 46. In my view, the cumulative eect of the Plainti's testimony, the documentary evidence, the transfer of Kshs.1,500,000.00 and the subsequent issuance of cheques demonstrates, on a balance of probabilities, that the parties did not merely engage in discussions or casual nancial dealings. They entered into an arrangement pursuant to which money was advanced and was to be repaid. 47. I accordingly nd that the Plainti has proved the existence of an enforceable agreement between herself and the Defendant. The Legal Eect of the Parties' Agreement 48. Once the Court is satised that the parties entered into a binding agreement, the next consideration is the terms of that agreement. 49. The law is settled that courts do not make contracts for parties. Neither may a court rewrite a contract in order to relieve a party from the consequences of a bargain voluntarily made. 50. In National Bank of Kenya Ltd v Pipeplastic Samkolit (K) Ltd & Another [2001] eKLR, the Court of Appeal stated that a Court cannot rewrite a contract between the parties and that parties are bound by the terms of their contract unless coercion, fraud or undue inuence is pleaded and proved. 51. The same principle was rearmed by the Court of Appeal in Pius Kimaiyo Langat v Co-operative Bank of Kenya Ltd [2017] KECA 152 (KLR). 52. The principle applies equally where the agreement is established by conduct. Once the Court nds that the parties objectively manifested an intention to create legal relations and agreed upon essential terms, the Court must give eect to that agreement. 53. In the present case, the issue is not whether the Court should create a repayment obligation where none existed. Rather, the evidence demonstrates that money was advanced and that the Defendant subsequently issued cheques corresponding with the amount which the Plainti says was payable. Whether Kshs.1,500,000.00 was Advanced 54. On this issue there is little controversy. 55. The Defendant expressly acknowledged that Kshs.1,500,000.00 was transferred by the Plainti to the account of Hari Gakinya & Co. Advocates on 19 February 2019. 56. That acknowledgment constitutes important evidence corroborating the Plainti's testimony concerning the transaction. https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/948/eng@2026-09-23 5

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57. I must, however, distinguish between an admission of receipt or transfer of money and an admission that the entire amount claimed is unconditionally due and payable. 58. Order 13 rule 2 of the Civil Procedure Rules permits judgment upon admissions. The governing principles were restated by the Court of Appeal in Choitram & Another v Nazari [1984] KECA 47 (KLR), where the Court held that an admission upon which judgment may be entered must be plain, clear and unequivocal. 59. The Defendant's Defence plainly acknowledges the transfer of Kshs.1,500,000.00. However, the Defendant simultaneously asserts that the money was held as security and was connected with criminal proceedings. 60. In those circumstances, I would not treat the pleading as an unequivocal admission of liability for Kshs.1,500,000.00 for purposes of entering judgment under Order 13 rule 2 without considering the evidence as a whole. 61. Nevertheless, the admission is compelling evidence that the Plainti did in fact transfer Kshs.1,500,000.00 in connection with the transaction involving the Defendant. 62. I accordingly nd that the Plainti proved the advancement or transfer of Kshs.1,500,000.00 63. Whether the Additional Kshs.1,000,000.00 was Proved 63. The Plainti testied that she had advanced a further Kshs.1,000,000.00 to the Defendant on dierent occasions. 64. The Defendant denied receiving that amount but did not attend Court to explain his denial, did not cross-examine the Plainti and did not produce evidence to demonstrate what the relevant transactions represented. 65. The Court does not, however, accept the Plainti's evidence merely because it was unchallenged. The evidence must still be credible and suciently probable. 65. In assessing that evidence, I consider the subsequent conduct of the Defendant to be highly material. 66. The Plainti testied that the Defendant issued four cheques totalling Kshs.2,700,000.00. Two cheques totalling Kshs.1,700,000.00 were presented and dishonoured for insucient funds, while the remaining two cheques amounted to Kshs.1,000,000.00. 67. The face value of the cheques corresponds precisely with the amount which the Plainti says was due: Kshs.2,500,000.00 principal plus Kshs.200,000.00. 68. The Defendant oered no evidence explaining why he would issue cheques totalling Kshs.2,700,000.00 if, as he alleged, his only obligation related to Kshs.1,500,000.00. 69. The Court is entitled to consider the conduct of the parties in determining whether a contractual relationship existed and what its terms were. This is consistent with the principle in Ali Abid Mohammed v Kenya Shell & Company Limited (supra), that a contract may be inferred from the conduct of the parties. 70. On the totality of the evidence, I nd the Plainti's account concerning the additional Kshs.1,000,000.00 more probable than the Defendant's unsupported denial. 71. I therefore nd that the Plainti proved that she advanced a total principal amount of Kshs.2,500,000.00 to the Defendant. https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/948/eng@2026-09-23 6

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Whether the Amount Payable Was Kshs.2,700,000.00 72. The Plainti's evidence was that the parties agreed that the Kshs.2,500,000.00 would be repaid within three months together with Kshs.200,000.00. 73. The Defendant denied this term. 74. The additional Kshs.200,000.00 is therefore a material term which the Plainti was required to prove. 75. The Court cannot simply assume the existence of a contractual term merely because the Plainti has pleaded it. It must be established by evidence. 76. In this case, however, there is signicant corroboration in the Defendant's subsequent conduct. 77. The four cheques issued by the Defendant totalled Kshs.2,700,000.00. 78. This is not an insignicant coincidence. The cheques were issued by the Defendant himself. They correspond exactly with the sum the Plainti testied was agreed to be repaid. 79. Further, two of the cheques totalling Kshs.1,700,000.00 were presented for payment and dishonoured for insucient funds. 80. The Defendant's contention that the cheques were merely security for Kshs.1,500,000.00 does not satisfactorily explain why the aggregate amount of the cheques was Kshs.2,700,000.00. 81. If the cheques were intended merely to secure Kshs.1,500,000.00, the Defendant could reasonably have explained why instruments for Kshs.2,700,000.00 were issued. No such explanation was placed before the Court. 82. The Court must determine contractual intention objectively from the evidence and conduct of the parties. The subsequent conduct of the Defendant is therefore highly probative of the obligation which he understood himself to have undertaken. 83. I nd, on a balance of probabilities, that the agreed amount repayable was Kshs.2,700,000.00. The Alleged Security and the Criminal Proceedings 84. The Defendant's alternative case was that the Kshs.1,500,000.00 was security and was only payable upon conclusion of Nairobi HCCR Criminal Case No. 10 of 2020. 85. That assertion introduced a material condition to the Plainti's right to demand repayment. 86. The burden of establishing that particular condition rested upon the Defendant. 87. Yet the Defendant did not testify. No agreement setting out the alleged condition was produced. No correspondence was tendered demonstrating that the money was to be held as security. No witness was called to explain the alleged arrangement, and no evidence was tendered linking the Plainti to the alleged criminal proceedings in a manner capable of making her repayment claim contingent upon their conclusion. 88. The Court cannot give eect to a contractual condition merely because it appears in a Defence. A Pleading is not, of itself, evidence of the facts pleaded. 89. The Defendant's failure to testify does not relieve the Plainti of her burden, but it does mean that the factual explanation advanced by the Defendant remained unsupported by evidence. https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/948/eng@2026-09-23 7

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90. In Charterhouse Bank Limited v Frank N. Kamau (supra), the Court of Appeal explained that where a Plainti has adduced credible evidence which remains unchallenged, the absence of rebuttal evidence may become signicant in determining whether the Plainti has discharged the evidential burden. 91. In the present case, I nd that the Plainti's evidence is credible and is materially corroborated by the documentary evidence and the Defendant's own admission concerning the Kshs.1,500,000.00 transfer. 92. The alleged condition that repayment was dependent upon the conclusion of Nairobi HCCR Criminal Case No. 10 of 2020 has not been proved. 93. I accordingly reject that aspect of the Defence. The Motor Vehicle Logbook 94. The Plainti also testied that the Defendant gave her the Original Logbook for Motor Vehicle Registration Number KBP 298E as security. 95. She subsequently discovered that the Motor vehicle belonged to a third party and that the logbook was taken by CID ocers during investigations. 96. I do not consider it necessary for purposes of determining this suit to make any nding on ownership of the motor vehicle or on the criminal investigations concerning it. 97. The signicance of the logbook evidence is limited to the surrounding circumstances and the conduct of the parties. 98. It is consistent with the Plainti's evidence that the transaction involved an advancement of money and that the Defendant provided documents and later cheques in connection with repayment. 99. The issue before this Court is whether the Plainti proved the monetary claim. The ownership or criminal history of The Motor Vehicle is not an issue which requires determination in this Judgment. Eect of the Defendant's Failure to Testify 100. I have considered the Defendant's failure to attend Court and testify. 101. It is important to reiterate that Judgment cannot be entered merely because a Defendant has failed to testify. 102. In Charterhouse Bank Ltd (Under Statutory Management) v Frank N. Kamau [2016] KECA 153 (KLR), the Court of Appeal expressly rejected the proposition that a Plainti automatically succeeds merely because the Defendant has elected not to call evidence. 103. The Plainti must rst establish a credible prima facie case. Once such evidence has been adduced and remains unchallenged, the failure by the Defendant to oer evidence may become signicant because there is no evidential material capable of displacing the Plainti's case. 104. In the present matter, the Plainti did more than make an unsupported allegation. She testied concerning the advances, produced documentary evidence, demonstrated the transfer of Kshs.1,500,000.00 and produced the cheques issued by the Defendant totalling Kshs.2,700,000.00. 105. The Defendant's own Defence corroborates the Kshs.1,500,000.00 transfer. 106. I therefore nd that the Plainti has discharged the burden imposed upon her by sections 107, 108 and 109 of the Evidence Act. https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/948/eng@2026-09-23 8

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Liability 107. Upon consideration of the evidence as a whole, I make the following ndings: a. The Plainti and the Defendant entered into an oral agreement pursuant to which money was advanced to the Defendant and was to be repaid; b. The Plainti proved that Kshs.1,500,000.00 was transferred to the account of Hari Gakinya & Co. Advocates, which fact was expressly acknowledged by the Defendant; c. The Plainti proved, on a balance of probabilities, that she advanced a further Kshs.1,000,000.00 to the Defendant; d. The total principal amount advanced was therefore Kshs.2,500,000.00; e. The Plainti proved that the Defendant issued four cheques totalling Kshs.2,700,000.00 in connection with repayment of the amount due; f. Two of the cheques totalling Kshs.1,700,000.00 were dishonoured for insucient funds; g. The Defendant did not prove that the cheques were merely security for Kshs.1,500,000.00; h. The Defendant did not prove that repayment was conditional upon the conclusion of Nairobi HCCR Criminal Case No. 10 of 2020; i. The Plainti proved, on a balance of probabilities, that Kshs.2,700,000.00 was the amount agreed to be repaid. 108. The Defendant's Defence therefore does not, on the evidence before the Court, displace the Plainti's claim. 109. I accordingly nd the Defendant liable to the Plainti in the sum of Kshs.2,700,000.00. Interest 110. The Plainti seeks interest at Court rates. 111. Section 26(1) of the Civil Procedure Act gives the Court discretion to award interest on a decree for payment of money from the date of the suit to the date of the decree, in addition to further interest from the date of decree to payment in full. 112. The discretion to award interest must be exercised judicially and having regard to the circumstances of the case. 113. In Highway Furniture Mart Limited v Permanent Secretary & Another [2006] eKLR, the Court of Appeal recognised that the award and rate of interest are matters within the Court's discretion. 114. In the present case, although the Plainti testied to an agreed additional payment of Kshs.200,000.00, there was no independently established contractual rate of interest. 115. The Plainti is therefore entitled to interest at Court rates on the decretal sum. https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/948/eng@2026-09-23 9

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116. I accordingly award interest on Kshs.2,700,000.00 at Court rates from the date of ling suit until payment in full. Costs 117. Section 27 of the Civil Procedure Act provides that costs are in the discretion of the Court and that costs ordinarily follow the event unless the Court, for good reason, orders otherwise. 118. The Plainti has succeeded in her claim. I see no reason to depart from the ordinary rule. 119. The Plainti shall therefore have the costs of the suit. Disposition 120. Having considered the Pleadings, the evidence, the submissions and the applicable law, I am satised that the Plainti has proved her case on a balance of probabilities. 121. I have not entered Judgment merely because the Defendant failed to attend Court. Rather, I have considered the Plainti's evidence independently and have found it to be credible and suciently corroborated. 122. Of particular signicance is the Defendant's own acknowledgment that Kshs.1,500,000.00 was transferred to the account of Hari Gakinya & Co. Advocates. That admission, when considered together with the Plainti's testimony, the documentary evidence and the cheques totalling Kshs.2,700,000.00, provides a coherent evidential basis for the claim. 123. The law does not require every agreement to be reduced into writing. Where an oral agreement contains the essential elements of a contract and is established by the conduct of the parties, it may be enforced. In the present case, the advancement of money, the Defendant's acknowledgment of the Kshs.1,500,000.00 transfer and his subsequent issuance of cheques demonstrate the existence of a binding arrangement. 124. The Defendant's assertion that the money was merely security and that repayment was conditional upon the conclusion of criminal proceedings was not proved. 125. The Plainti has therefore established her entitlement to the amount claimed. 126. Judgment is hereby entered for the Plainti against the Defendant as follows: a. Kshs.2,700,000.00 being the amount due and owing to the Plainti; b. Interest on Kshs.2,700,000.00 at Court rates from the date of ling suit until payment in full; c. Costs of the suit to the Plainti 30 Days Right of Appeal. JUDGEMENT DATED, READ, SIGNED AND DELIVERED VIRTUALLY AT NAIROBI VIA MICROSOFT TEAMS PLATFORM THIS 23RD DAY OF SEPTEMBER,2026 __________________ L.A. MUMASSABBA PRINCIPAL MAGISTRATE https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/948/eng@2026-09-23 10

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In the presence of : Mrs. Mbeche for the Plainti Defendants: Absent Court Assistant: Phoebe. https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/948/eng@2026-09-23 11

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