Byleveld v Sultan & another (Civil Appeal E210 of 2026) [2026] KEHC 9459 (KLR) (2 July 2026) (Judgment)

 **REPUBLIC OF KENYA** **IN THE HIGH COURT OF KENYA AT NAIROBI** **MILIMANI LAW COURTS** **CIVIL APPEAL NO. E088 OF 2026** **(PREVIOUSLY CIVIL APPEAL NO. E210 OF 2023)** **KEEGAN BYLEVELD………………………………………………………. APPELLANT** **VERSUS** **SHAILA WANJIKU SULTAN…………………………………... 1ST RESPONDENT** **ELYSIUM EVENTS LIMITED………………………………… 2ND RESPONDENT** *(Being an appeal against the Judgment of Hon. J. W. Munene, Adjudicator/Resident Magistrate, in the Small Claims Court at Milimani in SCCCOMM No. E235 of 2023, delivered on the 9th day of August 2023)* **JUDGMENT** **BACKGROUND** 1. This is a first appeal from the Small Claims Court. The appellant, Keegan Byleveld, was the claimant before the Small Claims Court at Milimani in SCCCOMM No. E235 of 2023. By a Statement of Claim dated 16th January 2023 he sued the 1st Respondent, Shaila Wanjiku Sultan, and the 2nd Respondent, Elysium Events Limited, for Kshs. 1,000,000. 2. His case was that, sometime in April or June 2022, he, the 1st Respondent and two others, Ryan Freeston and Taza Salamut, orally agreed to establish and operate an events business under the auspices of the 2nd Respondent; that each of them would contribute Kshs. 66,600 towards capital, would market the venture and would share its profits; and that, although he paid his contribution, marketed the business and coordinated several events, his name was omitted from the 2nd Respondent’s register of directors and shareholders and the respondents declined to pay him his capital and share of the profits, which he ultimately quantified at Kshs. 933,400. 3. The Respondents denied any agreement, denied that the Appellant had ever been a director, shareholder, agent or contractor of the 2nd Respondent, and averred that, as a foreign national, the Appellant held a work permit confined to employment with Nemchem International (Kenya) Limited. 4. After a full hearing, at which the Appellant testified and called no other witness, and at which the 1st Respondent and Mr. Taza Salamut testified for the defence. The trial court framed a single issue of whether there existed a contract, oral or written, capable of founding the claim, and by a judgment delivered on 9th August 2023, dismissed the claim with costs. 5. The Adjudicator found that the proposed Mutual Separation Agreement relied upon was unexecuted and unenforceable; that no proof of payment of the Kshs. 66,600 had been tendered; that no minutes of the alleged discussions were produced; that Mr. Ryan Freeston was not called; and that the Appellant’s own associate, Mr. Taza Salamut, denied the very existence of the agreement. 6. Aggrieved, the appellant lodged the Memorandum of Appeal dated 30th August 2023, faulting the adjudicator for dismissing the claim, for failing to find that a prima facie case had been established, for failing to consider his evidence, and for awarding costs. 7. **THE APPELLANT’S SUBMISSIONS** 8. Through written submissions dated 22nd July 2025, the Appellant urged that the trial court misapprehended the nature of the parties’ relationship and applied an unduly narrow and formalistic view of contract formation. 9. He submitted that a contract need not be in writing; that it may be oral, or implied from the conduct of the parties, the touchstone being an intention to create legal relations coupled with the actual rendering of services. 10. Relying on authorities cited in his submissions, among them *John Kipng’eno Koech v George Kipng’etich & Another* [2022] eKLR and *Mega Pipes Solutions Ltd v Kedowa Developers Ltd* [2021] eKLR, he argued that his sustained conduct of marketing, negotiating with suppliers, coordinating events and incurring expenses, all with the knowledge and cooperation of the 1st Respondent, who was a director of the 2nd Respondent gave rise to a contract implied by conduct, and to ostensible authority binding the 2nd Respondent. 11. In the alternative, the Appellant invoked the equitable doctrines of quantum meruit and unjust enrichment, contending that, having rendered services and incurred expenditure from which the Respondents derived and retained a benefit, he is entitled to reasonable compensation; for this he relied on *Bashir H. Mohamud v Abdikadir Omar Mohamed* [2020] eKLR and *Royal Media Services Ltd v Telkom Kenya Ltd* [2022] eKLR. He further relied on Article 159(2)(d) of the Constitution, urging the Court to administer justice without undue regard to procedural technicalities, and on *Abok James Odera t/a A. J. Odera & Associates v John Patrick Machira t/a Machira & Co. Advocates* [2013] eKLR for the threshold of appellate interference. 12. He prayed that the judgment be set aside and judgment entered in his favour, or, in the alternative, that the matter be remitted for fresh hearing before a differently constituted court. **THE RESPONDENTS’ SUBMISSIONS** 1. Through written submissions dated 16th June 2025, the 1st and 2nd Respondents opposed the appeal as devoid of merit. They submitted that the Appellant failed to establish a justiciable cause of action, because for any contract to arise there must be offer, acceptance and consideration, relying on *William Muthee Muthami v Bank of Baroda* [2014] eKLR and *Attorney General v Kabuito Contractors Limited* [2023] KECA 230 (KLR). 2. They contended that the alleged verbal agreement was never proved; that Mr. Taza Salamut, though associated by the Appellant with the venture, gave uncontroverted evidence denying any such agreement; that no proof of payment of the Kshs. 66,600 was adduced; and that no company resolution, contract of engagement or written authorisation permitted the appellant to act on behalf of the 2nd Respondent. 3. The Respondents further submitted that the claim was, in any event, factually and legally untenable. The 2nd Respondent was incorporated only on 31st August 2022, so the Appellant’s assertion that he marketed and worked for it between June and August 2022 was, on its face, inconceivable. 4. The Appellant admitted on cross-examination that he had represented himself to third parties as a shareholder or director of the 2nd Respondent when he was neither. And, as a foreigner whose permit confined him to employment with Nemchem, he lacked capacity to engage in the business without contravening the Kenya Citizenship and Immigration Act. The claim of Kshs. 933,400, they urged, rested upon unexplained Excel sheets of no probative value. 5. They prayed that the appeal be dismissed with costs. **ISSUES FOR DETERMINATION** 1. Having considered the record of the trial court, the grounds of appeal and the rival submissions, this Court distils two issues for determination: 2. ***What is the scope of this Court’s jurisdiction on an appeal from the Small Claims Court, and do the grounds of appeal fall within it? And*** 3. ***Whether the learned adjudicator erred in law in dismissing the Appellant’s claim and in awarding costs.*** **ANALYSIS AND DETERMINATION** ***(a) The scope of this appeal*** 1. An appeal from the Small Claims Court is a creature of statute, and it is confined by that statute. Section 38 of the Small Claims Court Act, 2016 provides that a person aggrieved by a decision or order of the Court may appeal to the High Court *on matters of law* only, and that such a decision shall be final. 2. That is a significant departure from an ordinary first appeal under section 78 of the Civil Procedure Act, on which the appellate court is enjoined to re-evaluate the whole of the evidence and reach its own conclusions, subject only to the caution stated in *Selle v Associated Motor Boat Company Ltd* [1968] EA 123. 3. On an appeal from the Small Claims Court, by contrast, this Court sits, in substance, as a second and final appellate court; it does not retry the facts. The Appellant’s invitation to re-weigh the evidence afresh and to enter judgment in his favour must therefore be approached with that limitation firmly in mind. 4. What, then, amounts to a “matter of law”? The Court of Appeal in *Otieno, Ragot & Company Advocates v National Bank of Kenya Limited* [2020] eKLR, adopting *Stanley N. Muriithi & Another v Bernard Munene Ithiga* [2016] eKLR, restated the settled position that an appellate court confined to law will not disturb the findings of the court below *“****unless it is shown that the court below considered matters it should not have considered, or failed to consider matters it should have considered, or looking at the entire decision, it is perverse****.”* 5. A finding of fact wholly unsupported by evidence, or reached upon a misapprehension of the evidence or a wrong principle, is itself an error of law; but a mere disagreement with the weight the trial court attached to the evidence is not. The exercise of judicial discretion, such as an award of costs, is likewise a question of law. 6. Measured against that yardstick, grounds (a) to (c) of the Memorandum of Appeal that the adjudicator wrongly dismissed the claim, failed to find a prima facie case, and failed to consider the Appellant’s evidence are, in form, invitations to re-weigh the evidence. 7. They are therefore competent before this Court only to the extent that they disclose that the adjudicator’s findings were unsupported by any evidence, or were reached upon a wrong legal principle, or are perverse. 8. Ground (d), touching costs, raises a discretionary question of law. It is through this narrow aperture, and not by a fresh evaluation of the facts, that the impugned judgment must now be tested. ***(b) Whether the adjudicator erred in law*** 1. The starting point is not in doubt. A binding contract requires offer, acceptance, consideration and an intention to create legal relations. As the Court of Appeal put it in ***William Muthee Muthami v Bank of Baroda [2014] eKLR***, *“****the aggrieved party to an agreement must, in addition, prove that there was offer, acceptance and consideration. It is only when those three elements are available that an innocent party can bring a claim against the party in breach.****”* 2. Equally settled is that a contract need not be reduced to writing: it may be oral, or implied from the conduct of the parties. Had the adjudicator dismissed this claim merely because no written contract existed, that would have amounted to a misdirection in law, and the appeal would have had much to commend it. 3. But that is not what the adjudicator did. A fair reading of the judgment shows that the claim failed not for want of a written instrument, but for want of proof of the alleged oral agreement and its performance. 4. The burden lay on the Appellant, under sections 107 to 109 of the Evidence Act, to prove the facts he asserted. The peculiar difficulty of discharging that burden where the contract is said to be oral was explained by the Court of Appeal in **Attorney General v Kabuito Contractors Limited [2023] KECA 230 (KLR)**, where the Court observed, at paragraph 33, that ***“an oral agreement is merely a verbal communication of proposal and acceptance which is difficult to prove in future if any disputes arises… the burden of proof totally lies on the person who is claiming the right to prove the existence of an oral agreement,”*** and, at paragraph 34, ***that such a party bears “an onus to highlight the key terms of the contract and to prove the existence of the essential elements.”*** 5. On the evidence before the trial court, that onus was not discharged, and the adjudicator's finding cannot be branded perverse. The Appellant produced no proof of payment of the Kshs. 66,600 he claimed to have contributed, no M-Pesa statement, no receipt, a deficiency he conceded on cross-examination. 6. He further produced no minutes of the discussions allegedly held in April or June 2022. He did not call Mr. Ryan Freeston, said to be a party to the very agreement. And, most tellingly, the one person he associated with the venture, Mr. Taza Salamut, testified for the defence and squarely denied that any such agreement was ever made. 7. The 2nd Respondent was incorporated on 31st August 2022, yet the agreement and the bulk of the marketing relied upon are placed by the Appellant himself in the period from June to August 2022, before the company existed. A company cannot contract before it is born. **Section 44(1) of the Companies Act, 2015** provides that *“****a contract that purports to be made by or on behalf of a company at a time when the company has not been formed has effect, subject to any agreement to the contrary, as a contract made with the person purporting to act for the company… and the person is personally liable on the contract accordingly.”*** 8. It is trite that a company is not bound by a pre-incorporation contract unless, after incorporation, it enters into a fresh contract to that effect; mere adoption or acquiescence will not suffice. It follows that, as a matter of law, no obligation in respect of the pre-incorporation period could attach to the 2nd respondent, however the appellant’s dealings are characterised. 9. Nor do the equitable doctrines belatedly invoked rescue the appeal. Quantum meruit, unjust enrichment and estoppel by conduct appear nowhere in the Statement of Claim; they surface for the first time in the Appellant’s submissions on appeal. 10. A party is bound by its pleadings, and evidence or arguments at variance with them are for rejection as held in the Court of Appeal in **Galaxy Paints Company Ltd v Falcon Guards Ltd**, *“****the issues for determination in a suit generally flowed from the pleadings, and the trial court could only pronounce judgment on the issues arising.****”* 11. A second and final appeal confined to matters of law is emphatically not the occasion to introduce a fresh cause of action. In any event, these doctrines are not self-executing: each depends upon proof that a benefit was in fact conferred upon and retained by the Respondents, the very factual foundation the adjudicator found wanting. Equity, moreover, assists those who come with clean hands, and the Appellant admitted to holding himself out to third parties as a director or shareholder he never was. 12. Finally, as to costs, the award followed the event. Costs are in the discretion of the court, and the ordinary rule is that they follow the event unless the court, for good reason, orders otherwise. The appellant having failed before the trial court, the award of costs to the successful Respondents was a proper exercise of that discretion and discloses no error of principle warranting interference. 13. Drawing the threads together, the learned adjudicator did not misapprehend the law, did not act on a wrong principle, and did not reach a perverse conclusion. She correctly located the burden of proof, correctly appreciated that the claim turned on whether the alleged oral bargain was proved, and reached a conclusion amply supported by the evidence. Tested through the narrow lens that section 38 permits, the grounds of appeal disclose no error of law. **DISPOSITION AND ORDERS** 1. In the result, the appeal is without merit. I make the following orders: 2. The appeal dated 30th August 2023 is hereby dismissed. 3. The judgment and decree of the Small Claims Court at Milimani in SCCCOMM No. E235 of 2023, delivered on the 9th day of August 2023, are upheld. 4. The Appellant shall bear the costs of this appeal. 5. The costs held in the joint interest-earning account pursuant to the stay order of 29th February 2024, together with any accrued interest, shall be released towards satisfaction of the certified costs of the 1st and 2nd Respondents. Orders accordingly. DATED and DELIVERED at Nairobi this 2nd day of July , 2026. ……………………………………… **BENARD WAFULA MURUNGA** **JUDGE** **Delivered on a virtual platform in the presence of:** **for instructed by CSA Advocates LLP for the Appellants** **for instructed by ASA & ASA Associates for Respondents** **Kevin Babu - Court Assistant**