https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/13112

**REPUBLIC OF KENYA** **IN THE HIGH COURT OF KENYA AT MERU** **CIVIL APPEAL NO. E 071 of 2025** **DK RONO, J** **25 JUNE 2026** **BETWEEN** **DOREEN GAKII MBAYA……………………………………. APPELLANT** **AND** **FRANCIS MUGAMBI KAMOKO……………………...RESPONDENT** *(Being an appeal from the judgment/decree delivered on 20 March 2025 by Hon. Habrovinah Nyamweya, Adjudicator, in Meru SCCCOM No. E022 of 2025)* **JUDGMENT** **Background** 1. This appeal arises from the Judgment of the Small Claims Court at Meru delivered on 20 March 2025 in SCCCOM No. E022 of 2025. Doreen Gakii Mbaya (‘the Appellant’), had instituted proceedings against the Respondent seeking payment of Kshs. 500,000 allegedly arising from a soft loan advanced toFrancis Mugambi Kamoko (‘the Respondent’). 2. Before the trial court, the Appellant contended that she advanced the Respondent a total sum of Kshs. 330,000 on diverse dates. According to her, the parties agreed that the principal amount would attract interest of Kshs. 170,000 bringing the total amount payable to Kshs. 500,000. 3. The Respondent filed a response admitting receipt of Kshs. 200,000 from the Appellant. He further stated that he had repaid Kshs. 20,000 leaving an outstanding balance of Kshs. 180,000. 4. Upon hearing the parties, the learned adjudicator entered judgment in favour of the Appellant and awarded her Kshs. 280,000 together with costs assessed at Kshs. 30,000. 5. Aggrieved by the said decision, the Appellant lodged the present appeal through a memorandum of appeal dated 27 March 2025 raising the following grounds: 1. That the learned Adjudicator erred in law and fact in failing to appreciate that the Appellant had proved that she lent the Respondent Kshs. 330,000; 2. That the learned adjudicator erred in law and fact by failing to appreciate evidence allegedly showing that the Respondent admitted owing Kshs. 330,000 exclusive of interest; 3. That the learned adjudicator erred in law and fact in failing to find that the parties had agreed on interest of Kshs. 170,000; 4. That the learned adjudicator erred in law and fact in failing to award damages for breach of contract; 5. That the learned adjudicator erred in law and fact in failing to award interest on the amount granted. 6. Before considering the merits of the appeal, it is necessary to restate the scope of this court's jurisdiction in appeals emanating from the Small Claims Court. 7. Section 38(1) of the Small Claims Court Act provides that: *‘A person aggrieved by the decision or order of the Court may appeal against that decision or order to the High Court on matters of law.’* 1. Consequently, this court does not sit as a first appellate court capable of re-evaluating facts and substituting its own findings merely because it would have reached a different conclusion. Its jurisdiction is restricted to determining whether the trial court correctly applied the law to the facts before it. 2. In *Ahamad Abolfathi Mohammed & Another v Republic* [2018] KECA 743 (KLR)**,** the Court of Appeal reiterated that where an appeal is confined to matters of law, an appellate court must respect findings of fact unless they are unsupported by evidence or amount to a perverse conclusion. 3. Similarly, in *Kenya Breweries Ltd v Godfrey Odoyo*[2010] eKLR**,** the Court of Appeal observed that on a second appeal an appellate court confines itself to matters of law unless it is demonstrated that the courts below considered irrelevant matters, failed to consider relevant matters, or reached a decision that is plainly perverse. 4. The same position was adopted in *Wanjiru v Kiilu*(2024) KEHC 8881 (KLR)**,** where the High Court held that appeals from the Small Claims Court are limited to questions of law and that factual findings may only be interfered with where they are so unreasonable that no reasonable tribunal could have reached them. 5. Accordingly, the issue before this court is whether the learned adjudicator committed any error of law warranting interference with the judgment rendered. **Analysis and Determination** 1. Having considered the memorandum of appeal, the record of appeal, the proceedings before the Small Claims Court, the judgment appealed from and the submissions of the parties, the issues falling for determination are: 2. Whether the learned adjudicator erred in law in failing to find that the Appellant had proved advancement of Kshs. 330,000 to the Respondent; 3. Whether the learned adjudicator erred in law in declining to award the alleged agreed interest of Kshs. 170,000; 4. Whether the learned adjudicator erred in law in declining to award damages for breach of contract; 5. Whether the learned adjudicator erred in law in failing to award interest on the decretal sum. 6. **Whether the Appellant proved advancement of Kshs. 330,000** 7. The Appellant's primary complaint is that the learned Adjudicator failed to appreciate the evidence placed before the court demonstrating that she had advanced to the Respondent a total sum of Kshs. 330 000. 8. Although this court's jurisdiction on appeal from the Small Claims Court is limited to matters of law, it is now settled that where a trial court ignores material evidence or arrives at a conclusion unsupported by the evidence on record, such a finding gives rise to an error of law capable of appellate intervention. This position was affirmed in *Kitui Flour Mills Ltd v David Nthiwa Kyalo & Another*[2021] eKLRand in *Ahamad Abolfathi Mohammed & Another v Republic*[2018] KECA 743 (KLR). 9. have carefully examined the record of proceedings and the documentary evidence produced before the trial court. The record reveals evidence showing that the Respondent acknowledged receipt of sums advanced by the Appellant amounting to Kshs. 330,000. There is further evidence demonstrating that the parties were ad idem regarding the principal amount advanced. 10. The learned adjudicator nevertheless proceeded to enter judgment for Kshs. 280,000 without adequately addressing the documentary acknowledgements and admissions appearing on the record. In my view, the omission to consider material evidence that directly established the amount advanced resulted in an erroneous conclusion. 11. Whereas this court would ordinarily defer to the factual findings of the trial court, such deference cannot be extended to findings that are plainly inconsistent with the evidence on record. Having reviewed the entire record, I am satisfied that the Appellant discharged the burden of proving that she advanced to the Respondent a total sum of Kshs. 330, 000. 12. Consequently, I find that the learned adjudicator fell into error in limiting the award to Kshs. 280,000 and that the Appellant was entitled to judgment for the principal sum of Kshs. 330,000. 13. **Whether the Appellant proved entitlement to Kshs. 170,000 as interest** 14. The Appellant contended that the parties agreed that the principal sum would attract interest of Kshs. 170,000 and that the trial court erred in failing to enforce that term. The burden of proving the existence of a contractual term lies upon the party alleging it pursuant to section 107 and section 109 of the Evidence Act. 15. While the record satisfactorily establishes that monies were advanced to the Respondent, I am unable to find evidence proving the alleged agreement that the loan would attract a fixed interest of Kshs. 170,000. 16. No written agreement setting out such interest was produced, nor is there evidence demonstrating with certainty the basis upon which the figure of Kshs. 170,000 was arrived at. The alleged interest appears to have been asserted by the Appellant but was not supported by documentary evidence capable of proving it on a balance of probabilities. 17. In the absence of satisfactory proof of the alleged contractual interest, I find no basis for interfering with the learned adjudicator's finding on that issue. 18. **Whether damages for breach of contract were payable** 19. The law is settled that general damages are ordinarily not awardable for breach of contract except in exceptional circumstances recognized by law. The usual remedy for breach of contract is an award of the loss proved to have arisen from the breach. 20. In the present case, the Appellant's loss consists of the unpaid loan advanced to the Respondent. Once the outstanding principal sum is awarded together with court interest, the Appellant is adequately compensated for the breach. 21. No separate loss was pleaded and proved to warrant an independent award of damages. Accordingly, I find no error on the part of the learned adjudicator in declining to award damages for breach of contract. 22. **Whether interest ought to be awarded** 23. The Appellant further argues that the trial court erred in failing to award interest; Although the Appellant failed to prove the alleged contractual interest of Kshs. 170,000, she nevertheless proved that the Respondent had retained and failed to repay monies lawfully advanced to him. 24. In the circumstances of this case, and in order to fully compensate the Appellant for being kept out of her money. I find that interest at court rates on the principal sum of Kshs. 330,000 is justified from the date of filing the claim before the Small Claims Court until payment in full. **Disposition** 1. In the final analysis this appeal partially succeeds. 2. The judgment of the Small Claims Court delivered on 20 March 2025 is hereby set aside is substituted with judgment in favour of the Appellant as follows: 3. The Appellant is awarded Kshs. 330,000 being the principal sum proved; 4. The claim for contractual interest of Kshs. 170,000 is dismissed; 5. The claim for damages for breach of contract is dismissed; 6. The Appellant shall have interest on the sum of Kshs. 330,000 at court rates from the date of filing suit until payment in full; 7. The Appellant shall have the costs of the proceedings before the Small Claims Court; 8. Given that the appeal has only partially succeeded, each party shall bear his or her own costs of this appeal. 9. It is so ordered. DATED, SIGNED AND DELIVERED VIRTUALLY AT MERU THIS 25th DAY OF JUNE 2026. **D K RONO** **JUDGE**