[2007] KEHC 2327 (KLR)
The court found that the Plaintiff had established its claim through documentary evidence, including the loan agreement, charge, guarantee, and bank statements. The 1st Defendant defaulted on the loan, and the 2nd Defendant was liable as guarantor and chargor. The Plaintiff made reasonable efforts to realize the...
Source-derived case information.
- Citation
- [2007] KEHC 2327 (KLR)
- Parties
- Plaintiff: THE CO-OPERATIVE BANK(K) LTD; Defendant: JOHN GITHAIGA NDERI; Defendant: ESTHER WANJIRU GITHAIGA
- Court
- High Court
- Court Station
- High Court at Nyeri
- Jurisdiction
- Kenya
- Case Number
- Civil Case 86 of 2001
- Procedural Posture
- Civil Case / Judgment
- Outcome
- Judgment entered for the Plaintiff against the Defendants jointly and severally.
- Legal Topics
- Loan Default, Guarantee Liability, Security Realisation, Compound Interest
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
THE CO-OPERATIVE BANK(K) LTD
Plaintiff
JOHN GITHAIGA NDERI
Defendant
ESTHER WANJIRU GITHAIGA
Defendant
Procedural Posture
Civil Case / Judgment
Legal Issues
- 1 Whether the 1st Defendant defaulted on the loan repayment obligations.
- 2 Whether the 2nd Defendant is liable as guarantor and chargor of the security property.
- 3 Whether the Plaintiff is entitled to judgment for the claimed sum and interest after failed attempts to realize the security.
Ratio Decidendi
The court found that the Plaintiff had established its claim through documentary evidence, including the loan agreement, charge, guarantee, and bank statements. The 1st Defendant defaulted on the loan, and the 2nd Defendant was liable as guarantor and chargor. The Plaintiff made reasonable efforts to realize the security, but the property could not be sold due to lack of acceptable bids. The Defendants failed to respond to demands or appear in court. Accordingly, the Plaintiff was entitled to judgment for the outstanding sum as at 28th October 2000, with compound interest at 25% per annum from that date, and costs of the suit.
Court Disposition
Judgment entered for the Plaintiff against the Defendants jointly and severally.
Orders
- The Defendants shall pay the Plaintiff Ksh.782,862.75 as at 28th October 2000.
- Compound interest at 25% per annum from 28th October 2000 until payment in full.
Full Case Text
Judgment text and source record
13 paragraphs
REPUBLIC OF KENYA IN THE HIGH COURT OF KENYA AT NYERI
Civil Case 86 of 2001
THE CO-OPERATIVE BANK(K) LTD……………………...……….PLAINTIFF
Versus
JOHN GITHAIGA NDERI
ESTHER WANJIRU GITHAIGA……………………….…….….DEFENDANTS
JUDGMENT
The Plaintiff’s case arises out of a loan granted by the Plaintiff to the 1st Defendant. That facility was guaranteed by the Defendant and in addition the 2nd Defendant charged her property L.R. NO. MWEIGA BLOCK 5/MUTHUINI/27as security for the said facility. The Plaintiff averred in the Plaint that the 1st Defendant defaulted in the repayment of the facility and that thereafter the Plaintiff unsuccessfully attempted to reaslise the charged property. That there were luck of acceptable bids to the said sale. The Plaintiff therefore prayed for judgment against the Defendants jointly and severally for Ksh.782,862. 75 together with compound interest at the rate of 25% from the 1st April 2001 until payment in full. On the day of hearing the Defendants, although served, failed to attend court. P. W.1 stated that he is a credit officer with the Plaintiff and has been so for the last five years. He stated that the 1st Defendant was granted a loan of Ksh.300,000/- on 29th October 1996. On the letter of offer which the 1st Defendant signed, it was provided that the loan would accrue interest at the rate of 29%, that is 6 % above base rate. As security for the said loan the Defendants offered property MWEIGA/BLOCK 5/MUTHUINI/27. In addition the 2nd Defendant offered a personal guarantee. After all the finalities were completed the 1st Defendant had the loan dispersed on the 8th January 1997 for Kshs.300,000/=. The Defendant failed to regularly maintain the loan account and on the 10th March 1998 the Plaintiff demanded the amount of Ksh.63,000/= as arrears and Ksh.66,776/= for the overdrawn current account. That demand elicited a response from the 1st Defendant by a letter dated 9th April 1998 where he indicated that he would continue to service the loan and committed himself to stabilize the current account. That promise was not upheld and a subsequent demand was sent dated 22nd December 1998. By then the account was in arrears of Ksh.130,133. 25 and the 1st Defendant failed to respond to the demand. On 12th March 1999, a demand was sent to the guarantor to the effect that the amount due and payable by the 1st Defendant was Ksh483,517. 05. In that demand the Plaintiff threatened to realize its security by sale of the charged property. P. W. 1 then gave evidence of the various attempts that were made by auctioneers to sell the charged property but that the same failed to realize any bidders. Thereafter demands were sent to the Defendants and the Defendants failed to respond.
In support of the Plaintiff’s claim there were exhibited bank statements, the charged document, the 2nd Defendant’s guarantee and the demands that were sent to Defendants.
I have examined the Plaintiff’s exhibits and have considered the evidence submitted on behalf of the Plaintiff and I find that a case has been made against the Defendants as prayed. Accordingly the court does hereby enter judgment for Ksh.782,862. 75 as at 28th October 2000 and with compound interest for 25% per annum, applicable from the 28th October 2000. The Plaintiff shall also have costs of the suit.
Dated and delivered at Nyeri this 6th day of July 2007.
MARY KASANGO
JUDGE