[2022] KEHC 10127 (KLR)

County Government of Narok v British Pharmaceuticals Limited (Civil Appeal 20 of 2020) [2022] KEHC 10127 (KLR) (12 May 2022) (Judgment)

Neutral citation: [2022] KEHC 10127 (KLR)

Republic of Kenya

In the High Court at Narok

Civil Appeal 20 of 2020

F Gikonyo, J

May 12, 2022

Between

County Government of Narok

Appellant

and

British Pharmaceuticals Limited

Respondent

(An appeal from the Judgment and Decree of Hon. G.N. Wakahiu (C. M) Delivered on 89. 2020 in Narok CMCC No. 99 of 2017)

Judgment

Nature of case as filed 1. The respondent’s claim before the Chief Magistrates' Court at Narok was for a contract sum of Kshs 7,049,628 against the appellant; on account of four (4) local purchase orders numbers 2184819, 2184820, 2184821 and 2184822 for the supply of various pharmaceuticals and allied products to hospitals in 4 sub­ counties, namely, Narok North, Narok South, Transmara East and Transmara West.

2. The appellant denied the claim on the ground that the four (4) LPOs on which therespondent based its claim were never issued by them but were irregularly and fraudulently acquired through collusion with one of its rogue employees. The appellant further alleged that the medical supplies for which therespondent claimed payment were never supplied to them.

Impugned findings 3. Findings which angered the appellant in the judgment of the chief Magistrate’s Court at Narok in Civil Suit No. 99 of 2017 delivered on September 8, 2020 are: -i.That the fact that an LPO stands up and is the start of intention to create a legal obligation by a party as such a legal obligation was created by the defendant in issuing the LPO to the plaintiff. (A contract existed between the parties).ii.That the defendant’s allegations of fraud in the defence failed and the contract is valid and enforceable against the defendant.iii.Order that the defendant to pay Kshs. 7,048,628/= plus interest at court rates.iv.Order for the defendant to bear the costs of the suit with interest at the prevailing court rates from the date of the judgment.

4. The memorandum of appeal dated October 6, 2020cites eight (8) grounds of appeal. The appellant prayed that this honourable court sets aside the whole of the judgment of and decree of the chief magistrate’s court at Narok dated September 8, 2020. The respondent urges the honourable court to dismiss the appeal with costs to the respondent.

Background 5. In view of the arguments presented in this appeal, background information is relevant. The matter was heard by Hon. Wilbroda Juma (CM) 9th October 2019 and November 19, 2019 with the Plaintiff and Defendant calling one witness each. Upon the close of the Defence case the honourable magistrate directed parties to file their respective written submissions. The matter was slated for mention on February 26, 2020 with a view of taking a judgment date. However, the Learned Magistrate retired from office before delivering the Judgment. The suit was thus scheduled for mention for directions and issuance of date for judgment before Hon. G.N. Wakahiu (CM) on July 15, 2020. On this date both parties were present. The Learned Chief Magistrate assigned the suit a date for Judgment; i.e. August 4, 2020. Notably, the appellant did not object to the Learned Magistrate writing judgment on the evidence as recorded by his predecessor. No other directions were sought by the appellant.

6. On August 4, 2020, the Judgment was not ready; it was deferred to August 25, 2020and subsequently to September 15, 2020on account of it not being ready. On September 14, 2020, pursuant to the Chief Justice 's directions on restriction of court operations with a view to containing the spread of Covid-19, the parties received an invitation from the court's registry requiring them to intimate by consent on having the Judgment delivered on theSeptember 15, 2020 via e-mail- which they did through their e-mail of an even date and forwarded the same to the respondent's advocates. The said Judgment was delivered on September 15, 2020.

Analysis and Determination Duty of court 7. The first appellate courtshould evaluate the evidence afresh and make its own conclusions, albeit it must bear in mind that it neither saw nor heard the witnesses first hand (See Selle & anor –vs- Associate Motor Boat Co. Ltd 1968 EA 123).

8. Directions were given that the appeal be disposed of by way of written submissions. The appellant and the respondent filed their respective written submissions, which I have considered. I have also considered the pleadings. Arising therefrom, are five issues for determination, namely:i.Whether the Learned Magistrate erred in law and misdirected himself in writing and delivering Judgment entirely based on evidence by a different Magistrate.ii.Whether the Learned Magistrate completely disregarded Appellant's pleadings, evidence and Written Submissions leading to a failure to consider and determine the issues raised therein and/or give reasons for the Judgement.iii.Whether the Learned Magistrate erred in law and in fact in failing to apply the decision in Pakatewa Investment Company Limited v Municipal Council of Malindi (2016] eKLRiv.Whether the respondent proved its case on a balance of probability.v.Whether the appellant proved fraud and collusion in relation to the transactions which led to s.13vi.Order as to costs.

Writing judgment on evidence by a different Magistrate 9. The appellant submitted that upon being seized of the file Hon. Wakahiu ought to have sought the consent of the parties as to whether they were comfortable with him rendering the Judgement despite not having the benefit of seeing and hearing the witnesses. The appellant argued that that is the practice as prescribed in order 17 of the Civil Procedure Rules, 2010.

10. The respondent submitted that allegations levelled against the Learned Magistrate are unfounded and unsupported by the court's record of proceedings. The respondent further submitted that failure to follow a proper procedure in delivery of Judgment does not render the judgement incompetent on a properly concluded trial by a competent court. I will deal with this issue separately, and later. They relied in the decision of the Court of Appeal in Oraro & Rachier Advocates v Co-operative Bank of Kenya Limited [2001) eKLR

11. The trial was conducted before Honourable Wilbroda Juma (CM) to finality. But, soon thereafter, the said Magistrate retired. This matter was transferred subsequently to Hon. Wakahiu who set down the suit for directions, during which time he assigned the suit a date for Judgement.

12. The defendant; now the appellant, was represented throughout the proceedings before Hon. Wilbroda Juma (CM).

13. Of value, the record show that Mr. Kere, Advocate for the appellant was present on July 15, 2020when the suit was scheduled for directions. He did not raise any objections to the learned magistrate writing and delivering the Judgment based on the evidence taken by his predecessor, and Submissions of the parties filed thereto. It was at the point of directions that the objections I am seeing now ought to have been raised. None were raised. I wonder why even in subsequent occasions when the judgment was deferred, no objections were raised by the appellant. I must state that, Mr. Kere,counsel for the appellant; my appreciation of him during the great number of times he has appeared before me, is that, he is diligent, his wit as counsel, in its essential properties, is of the same kind with that of great and promising young advocates, who will one day occupy the eminent chairs of merit in the bar. It is not that these objections being raised on appeal were hidden from him at the time, or that they have now revealed themselves now; but only I should think, this is stealth and contrived omission or deliberate tapping from the ‘’grace’’ of afterthought in the hope that it will pass for an indomitable point against the respondent’s claim. Needless to state legal counsel are officers of the court and ministers of justice, and parties bear statutory obligation to assist the court attain the overriding objective, inter alia, expeditious, fair, just and affordable resolution of cases. The appellant has militated against these obligations. The appellant’s hands are soiled here.

14. The foregoing notwithstanding, there is no prohibition in law for a judicial officer to proceed with or conclude a case on the basis of evidence recorded by another judicial officer. Order 18 rule 8 (1) of the Civil Procedure Rules,2010 provides for the power of the court in dealing with evidence taken by another judge as follows: -‘8 (1) Where a judge is prevented by death, transfer, or other cause from concluding the trial of a suit or the hearing of any application, his successor may deal with any evidence taken down under the foregoing rules as if such evidence had been taken down by him or under his direction under the said rules, and may proceed with the suit or application from the stage at which his predecessor left it"

15. Of the foregoing rule, I should think the observations made by Duffus, J.A. in Mandavia –vs- Rattan Singh [1968] E.A. 146 are apt, that:“… it seems to me that the proper test is whether the successor Judge is in as good a position as his predecessor would have been in to evaluate the evidence and submissions which have been put forward and to continue the hearing on that basis.”

16. Accordingly, where there is no particular difficulty that impairs the ability of the successor judge from proceeding with or upon evidence recorded by another judge, and no prejudice will be occasioned upon a party, the successor judge should, under order 18 rule 8 (1), proceed upon evidence already taken down to conclude the suit.

17. In this case, evidence taken has been recorded and typed. There is nothing which has been shown to produce prejudice to the appellant who was duly represented during the taking of the proceedings. In any case, the appellant did not raise any objection to the successor magistrate determining the suit on the basis of the evidence recorded by his predecessor. I have also found there is no prejudice that will be suffered by the appellant. Basing this appeal on such objections is stealth and an attempt to steal a match from the other party.

Delivery of judgment through email 18. I promised to deal with queries on how the judgment was delivered, later. I pay my debt. Following the outbreak of Covid-19 pandemic, one of the major measures recommended by the WHO for prevention of infection of the disease was social distancing which entailed minimum distance from the next person, and where possible staying away from other people. Courts embraced technology as enabler of delivery of justice and also as a prevention measure for COVI-19 by eliminating physical contacts among the court users, judicial officers and staff of judiciary. Technology-based designs were therefore devised to dispense with or minimize physical court appearances or contacts as a measure to prevent COVID-19 pandemic infections. Judgments could now be delivered through technology-based applications including e-mail.

19. Rule 16(7) of the Practice Directions on Electronic Case Management, (2020) allows Judges/Magistrates to transmit a copy of a judgment using electronic means."Electronic exchange of court documentsA court may electronically transmit a copy of the ruling, judgment, directions orders or other document using electronic means.’’

20. Therefore, the judgment herein was duly delivered as per the law and applicable rules of procedure. The complaint lacks merit and is dismissed.

Disregard of Appellant's pleadings, evidence and Written Submissions, and failure to determine the issues or give reasons for the Judgement. 21. The appellant submitted that the Learned Magistrate failed to adhere to the provisions of order 21rule 4 of the Civil Procedure Rules, 2010. They stated that he only regurgitated the respective written submissions of the parties’ word for word, failed to analyze the same and/or apply the facts in rendering a reasoned decision on the respective arguments by the parties. They accused him of failing to determine the issues of validity of the LPOs, the question of fraud and collusion between the respondent and one of the appellant's rogue employees.

22. I take the following view of this issue. The form and contents of a judgment is provided for under order 21 rule 4 of the Civil Procedure Rules, 2010 which provides in clear terms that“Judgment in defended suits shall contain a concise statement of the case, the points for determination, the decision thereon, and the reason for such decision."

23. Order 21 rule 5 provides that a court shall state its decision on each issue.

24. I do note that the trial court reproduced the parties’ submission which occupied 33 pages of the 36 pages of the judgment. However, there is no particular or preferred manner or style of stating parties’ submissions in a judgment. There are judicial officers who are good at summarizing lengthy or giving a precis of the submissions. Others are not so good. Others reproduce the submissions for emphasis of or to capture all the points urged. It is not strange that there are submissions by legal counsel which are already concisely stated. Except, however, reproducing the submissions as is; may make a judgment too lengthy; and result into dull and boring repetition of the submissions in the analysis section. Nevertheless, whatever style one adopts, it should capture all relevant arguments made in the case in a concise and clear manner. But, again, I remind that, a severely restricted summary or precis of the parties’ arguments may serve an altogether different purpose: distortion or omission of pertinent elements of the parties’ cases.

25. In my view, judicial writing and decisions should accord with the law; state the parties’ case; state the issues, determine the issues and reasons thereof; and, effectually and completely determine the dispute. But, there is another aspect of judgment writing; communication, effective communication: every sentence must carry the reasoning forward in a manner which creates and keeps legitimate excitement constantly renewed to reach the significant conclusion of the judgment. This avoids much bald and dry judgments.

26. The argument made on this point by the appellant, does not, therefore, yield any profit to the appeal.

27. The only argument by the appellant that deserves evaluation is that the trial magistrate did not determine all the issues in the case. I am aware of the serious effects of failure to determine relevant issues in a case. Issues are determined upon evaluation of evidence, facts of, and law applicable to the case. See Chandaria v Nyeri {1982} KLR 84 at 85, where the court observed that failure to deal with many of the issues makes the judgment unsatisfactory and amounts to a mistrial.

28. What is the case here?

29. I have perused the judgment. The trial magistrate after perusing the pleadings and the proceedings framed three broad issues. The issues were all-encompassing of the matters in controversy. Issues flow from the pleadings, and in rare cases from the course of proceedings where parties have taken a path which clearly show that they left the matters arising from evidence for determination of the court (Odd Jobvs. Mubea). It is apparent from the record that the trial court determined all the relevant issues in controversy within the broad issues framed. I do note that even matters of fraud and collusion as well as validity of the LPO’s which were alleged by the appellant were also determined, and he found that the appellant did not adduce evidence to prove those matters. He rejected their claims.

Of reasons for decision 30. Reasons are ordinarily embedded in the decision in respect of every issue, and I do not think there is a requirement of law that they be stated separately or on a separate cover entitled ‘’reasons for the decision’’ unless it was in relation to an ex tempore decision of which reasons were reserved and rendered later and separately or it is an executive summary. The obligation to give reasons for the decision is not merely a common law or statutory requirement, but also has a constitutional dimension within the principle of substantive justice. See Public Service Board of New South Wales v Osmond (1986) 159 CLR 656 (‘Osmond’) and Wainohu v New South Wales(2011) 243 CLR 181. Therefore, a decision devoid of reasons is hollow, and cannot be said to determine the dispute effectively and effectually.

31. Whether the reasons are adequate or sufficient, does not, however, evince simple answer. It is always a matter of degree in relation to the facts of the case and the nature of the decision. The reasons should nevertheless be clear.

32. The process of reasoning in the judgment charts the path by which the court arrived at the conclusions in the decision. The trial magistrate stated his finding drawing upon the evidence and the submissions of parties the way he perceived and understood them. He also gave the factual and legal basis for his findings. These matters will become clear when I shall be discussing the specific findings by the trial magistrate later. The appellant may not agree with the findings or reasons given. Thus, I should state her, that, erring or being wrong in appreciation of the evidence or the submissions of parties or the law does not mean the decision did not state the reason for the decision.

33. Another important thing to note: although a court is obliged to give reasons for its decision, it is not required to address every submission that was advanced during the course of the hearing as long as the court has determined and given reasons on the principal and relevant issues upon which the decision turns; this is the muster. The trivial or minor matters are only to be properly subordinated. See Telstra Corporation Ltd v Arden {1994} 20 AAR 285. Burchett J And Dodds v Comcare Australia (1993) 31 ALD 690}}, 691.

34. Before I close on this issue, the judgment is 36 pages; 33 pages of it relates to the written submissions of the parties. I know not of any legal requirement which gauges quality of a decision by its length or shortness. The quality of a judgment is in its content and essential properties. In the last four pages of the judgment, the Learned Magistrate analyzed three issues;i)Whether there existed a contract between the plaintiff and the defendant;ii)Whether the contract was valid and enforceable; andiii)Whether the plaintiff was entitled to the relief sought.

35. These were broad issues which subsumed all the other smaller strands pursued by the appellant.

36. Having said that, there is no particular method or style for analyzing the issues or evidence. Analysis need not be as extensive but need only to comprehend all the issues to the point, and the applicable law. In drawing the issues, the trial court declared that it has perused and understood the pleadings, proceedings and written submission. It then recorded: -Firstly, this court looks to frame the issues for determination as drawn from the pleadings and proceedings from the parties herein’’.

37. The trial court then set out the above referred issues.

38. I will continue to pursue the record.

39. On issue one; the trial court set out his judicial mission thus: -In establishing whether their [sic] existed a valid contract we first have to establish the definition of contract and whether issuance of LPOs constitute a valid and enforceable contract under the auspices of a contract…’’

40. The trial court enumerated what constitutes a valid contract and cited the definition of contract from Blacks Law Dictionary, and stated: -‘’From the above analysis, I then conclude that the fact that an LPO stands up and is the start intention to create a legal obligation by a party. As such, I find that a legal obligation was created by the defendant in issuing the LPO to the plaintiff.

41. As this case rests on procurement of goods through LPO, the trial court was correct in starting to establish whether the a contract was created by the LPO. See the Black’s Law Dictionary a Local Purchase Order is:“A document that has been generated by the buyer in order to purchase products or property. This document allows a transaction to occur and when accepted by the seller becomes a legal binding contract of sale.”

42. The trial court was alive to this legal position, and embarked on determination of the second issue, and started thus: -‘’Having established that a contract existed between the parties I will indulge into what makes a contract valid and enforceable in efforts to establish if indeed the contract relation between the Plaintiff and the Defendant was enforceable….The court was shown evidence of LPOs issued by the Defendant and received by the Plaintiff in addition evidence have been tendered showing the Delivery notes signed by the Defendant representatives’’.

The Procurement Process 43. The court is acutely aware that the appellant submitted that the tendering process on which the respondent based its claim was irregular and contrary to the provisions of the Public Procurement and Disposal Act. The appellant contends that they procure goods and services in accordance with Public Procurement and Disposal Act (repealed); the procurement law currently in force. They argued that, pursuant to the provisions of section 26 (3) of the said Act the appellant strictly adhered to the laid down process.

44. The appellant also submitted that the LPOs are not attributable to any asset procurement plan. The LPOs appear to have been allegedly processed exclusively by the department of health, with no approval from the procurement department. They stated that as per the appellant's procurement records for the year 2014/2015, the tender committee never authorized the procurement of the said medical supplies from the respondent as indicated in the impugned LPOs. That since the impugned LPOs were never properly processed, they do not bear her signature yet at the time she together with the accountant were the authorized officers to sign the same before collection by any supplier.

45. The appellant claimed that the impugned LPOs and delivery notes were fraudulently acquired and raised.

46. The appellant seems to place the burden of proving these allegations on the respondent, yet in law, they bore the legal burden of proof. And the standard of proof is beyond a balance of probabilities but not as high as beyond reasonable doubt. It is quite high than proof of ordinary civil claim.

47. The appellant seems to blame one Mr. Mitto who was at the time an employee of the Health Ministry seconded to the appellant of being the author and signatory of the LPOs and delivery notes in issue. This was their employee, and proof that he was not authorized was necessary.

48. DW1 confirmed that in all the 4 LPOs, the county secretary signed, DW1 signed at the top right. She admitted having dealt with the transaction. She stated that the LPOs were issued by the department of health and sanitization. The user department can raise an LPO except she stated that it had to pass through procurement department. These are their internal mechanism of which they had special knowledge.

49. I do note that, in their submissions, the appellant stated that the Respondent had in a previous transaction supplied goods to it. The appellant followed the right procedure in obtaining an LPO No. 2184778 which was processed correctly with deliveries done and the respondent was duly paid.

50. S13 shows the goods were received but DW1 alleges it was not received. No evidence was tendered by any witness from or the user department of health and sanitation to verify their allegations that the goods were not supplied by the respondent or received. In the face of such serious allegations, no action was taken on the matter in relation to fraud and collusion alleged against an employee of the defendant.

51. It bears repeating ‘’…that fraudulent conduct must be distinctly alleged and as distinctly proved, and it is not allowable to leave fraud to be inferred from the facts.” (See Urmila w/o Mahendra Shah v Barclays Bank International Ltd & another [1979] eKLR, .in Vijay Morjaria v Nansingh Madhusingh Darbar & another [2000] eKLR, Tunoi JA (as he then was). The appellant did not adduce such succinct evidence to prove fraud in the issuance of the LPOs in issue and transactions leading to the issuance of S.13.

52. The trial magistrate considered claims of fraud or collusion and stated….: -‘’On the issues s to whether the contract was obtained fraudulently I find that the Defendant failed to prove same and there was no evidence tendered to prove fraud during these proceedings. This being a court of law and facts the Defendant ought to have proved beyond a balance of probabilities , but instead made a mere speculation. It does not go without saying that the Defendant’s employee suspected to have been involved in the ‘supposed fraudulent act’ is still working under the Defendant with no actions and or restrictions put to his roles.

53. The trial magistrate cited the case of Brodgen VS. Metropolitan Railway Company [1876-77] L.R. 2App Cas 666 on acceptance of contract through conduct of parties with specific reference to the fact that the fact that the Defendant believed that the contract was obtained fraudulently and did nothing, but to allow its representatives to sign delivery notes is conduct that make the contract binding, and so he concluded: -‘’I therefore find the Defendant allegations of fraud in the defence failed and the contract is valid and enforceable against the Defendant’’.

Case distinguished 54. Before I close, the appellants have invited this court to consider the case of Pakatewa Investment Companv Ltd v Municipal Council of Malindi (2016) eKLR.

55. Unlike Pakatewa Case, prior to the transaction in dispute, the Appellant herein had contracted the Respondent for the supply of pharmaceutical products and paid for the same and this matter never arose from a one-off dealing. In Pakatewa Case, the Court noted the absence of an LPO from the user department whereas in this matter evidence was adduced proving that the appellant originated the LPOs through the user department of Health and Sanitization and the appellant itself provided documents (s13 forms) confirming it received supplied products by the respondent. In Pakatevva Case, evidence was availed demonstrating that Mr. Yaa had been suspended for having procured goods, without authority while in the present appeal, the appellant did not avail any evidence, documentary or otherwise, proving that it never authorized the procurement for the supply of the goods in issue. Also, no evidence was tendered proving that the said Mr. Mito acted unlawfully and was indicted or reprimanded or taken through disciplinary process for the alleged flawed procurement process.

56. I note just like the learned magistrate that in the circumstances of this case, absence of any criminal charges or proceedings or investigations against the respondent and its alleged conspirators over the LPOs, completely detracts from the appellant’s allegations of fraud and collusion thereto. There was no demonstration of fraud or collusion.

Conclusions and orders 57. Accordingly, I find that the respondent proved on a balance of probabilities there was a valid and enforceable contract between the parties; and is entitled to relief sought. I also find that, the appellant did not prove fraud or collusion in respect of the transaction subject of these proceedings. Further finding; that contrary to the appellant’s submissions, the trial court considered and analyzed appellant's pleadings, evidence, Written Submissions, the issues raised therein and the law, and gave reasons for the decision. And, I too find that the trial court properly proceeded to conclude the case on the basis of the evidence recorded by his predecessor.

58. Ultimately, I find the appeal to lack merit and is dismissed.

Costs 59. Section 27(1) of the Civil Procedure Act provides that costs follow the event. Nothing prevents the successful party from getting cost of the appeal. I award costs to the respondent. Orders accordingly

DATED, SIGNED AND DELIVERED AT NAROK THROUGH TEAMS APPLICATION THIS 12TH DAY OF MAY 2022--------------------------------------------------------F. GIKONYO M.JUDGEIn the presence of:1. Kere for Appellant2. Ochieng for Respondent3. Kasaso C/A