https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/11549

**REPUBLIC OF KENYA** **IN THE HIGH COURT OF KENYA AT MIGORI** **CIVIL CASE NO. E001 OF 2022** **EDON CONSULTANTS INTERNATIONAL LIMITED……………………..PLAINTIFF** **VERSUS** **THE COUNTY GOVERNMENT OF MIGORI………………….……….DEFENDANT** **JUDGMENT** Vide a plaint dated 23rd May 2022 the Plaintiff herein sued the Defendant County Government seeking general damages for loss suffered, Special Damages of Kshs 35,121,900/=, interest from the date of filing until payment in full and costs of the suit. The claim herein arose out of contract dated 7th June 2019 between parties herein where the Plaintiff was engaged to provide consultancy services by providing proposal for the design and supervise the construction of the proposed County Office Headquarters, Governor and Deputy Governor’s residences as per the general conditions of the agreement. That this was after the Defendant had floated tenders calling for bidders for the provision of the aforementioned services the Plaintiff submitted its bid and was successful in its bid. It was therefore awarded the works through the aforementioned contract dated 7th June 2019. The Plaintiff in the Plaint said that the contract amount was Kshs. 84,100,000/= and that he expected the terms and conditions of the contract would be honored by both parties and the Defendant was to pay for the services rendered when the same fell due. That clause 3 of the contract provided for the stages of payment as follows:- Preliminary Design …………… 20% of the contract price Final Stage …………………… 25% of the contract price Detailed design and tender documents ,,,,,,,,,,, 30% of the contract price Construction Supervision ………………. 25% of the contract price That on 7th January 2021 pursuant to the said contract, and the works done, the Plaintiff raised fee note No. 2 dated 7th January 2021 for Kshs. 35,121,900/= which he duly served upon the Defendant for processing the payment. That despite receiving the fee note, the Defendant failed to make the payment as demanded for by the Plaintiff. That the Plaintiff’s numerous attempts to follow up the attempts were futile. That vide letter dated10th March 2022, the Plaintiff’s Advocate wrote to the Defendant notifying it of the grievances raised by Plaintiff. That they also demanded that the Defendants makes good of the obligations under the contract by paying to the Plaintiff the said sum of Kshs. 35,232,900/=which were due and owing pursuant to the works done. He said that the demand was not honured. That in breach of the agreement, the Defendant had failed to pay for the service by the rendered by the Plaintiff and that the said failure has distressed the Plaintiff’s business operations. The Plaintiff gave particulars of the breach by the Defendant and the particulars of loss as a result of the said breach. In his evidence in chief the Plaintiff said that he was an Architect with 44 year experience. That he was the Managing Director of Edon Consultants International. He said that on 9.5.2019 they saw an advert in the paper requesting for proposals to design and supervise the construction of Migori County Headquarter and the Governor’s house. That they submitted their proposal and were successful at contract sum of Kshs. 84,100,000 to be paid in different stages with specified milestones. The Plaintiff sought to rely on the statement he recorded on 22nd May 2022 at the time of filing suit as his evidence in chief. PW1’s statement adopted. He said he made a further statement dated 9.10.2023 and he wish to rely on it – adopted. He also said that he did file documents as per the list dated 23.5.2023 and he wished to produce the list of documents and also the said documents listed therein as Certificate of incorporation Exp 2 – CR 12; Exp 3 – copy of contract dated 7.6.2019; Exp 4 – Copy of fee note No. 2 dated 7.1.2021 * Exp 5 – Demand letter by plaintiff dated 10.3.2022; In the Second list:- Letter of acceptance dated 17.5.2019 annexture JEON/02 Exp 6 Letters of award and acceptance dated 14.5.2018 -JEON/01 not produced * Exp 7- consultancy contract agreement dated 7.6.2019 annexed as JEON/03 * Exp 8 – Financial proposal annexed as JEON/04 * Exp 9 -Preliminary design drawing – JEON/05 * Exp 10 -Final design drawing annexed as JEON/06 * Exp 11 – Detailed design drawing JEON/07 * Exp12 – Tender documents and Bill of quantities JEON/08/A/B/C * Exp 13 -Letter inviting plaintiff to go and ….. site dated 31.3.2021 annexed as JEON/09/A/B/C * Exp 14 – Technical proposal submitted to the defendant JEON/10 Further list * Exp 15 – bank statement showing part payment received from Migori County Government dated 7.1.2020 * Exp 16 – plaintiff’s fee note dated 24.6.2019 * Exp17 – plaintiff’s fee note dated 7.1.2021 The consultancy agreement had milestone of payment. The 1st milestone was preliminary designs and we were to be paid 20% of the contract sum of Kshs. 84,100,000 i.e. Kshs. 16,820,000. The second milestone was final drawing and we were to be paid 25% of the contract value. That was Kshs. 21,025,000 The 3rd stage was detailed design drawing and tender documents for which we were to be paid 30% being Kshs. 25,230,000. The 1st, 2nd and 3rd stage of consultancies were completed. The total up to the 3rd stage was Kshs.63,075,000 The 4th stage was construction supervision was to be 25% of the total cost which is Kshs. 21,025,000. We didn’t do the 4th stage as the contract was frustrated when we handed over the site. The defendants used their documents to procure services of building contractors. PW1 said they did not procure contractors. It was the clients’ obligation to procure contractors. He said that when they were to move to the site the procured contractors could not go in because there was alleged dispute over the land. That by the time the contractors went to site out of Kshs. 63,075,000 which was due for services done they only received Kshs. 26,073,495 into the plaintiff’s account. PW1 said that normally when they pay a consultant, they take VAT and withholding tax. VAT is supposed to be 16% but the client only retained 2% of VAT and 5% for withholding Tax. He said that what they were paid was not related to the milestone payments. He said what the Plaintiff was paid covered part 1 and part of part 2. Part 3 was totally not paid. PW1 demanded/claimed the balance of Kshs. 35,121,900. He said the contract was frustrated and they were not claiming part 4. PW1 said the contract was never terminated. It is still live. According to him the contract was merely suspended. The defendants went silent after part 4 was not done. That PW1 wrote many letters demanding payments and failed. He said he was not aware if the defendants had entered into the contract with another contractor but he was informed the defendants are constructing in another site and could be using their drawings but he wanted to be paid. PW1 said that when they got consultancies contract, they engaged quantity surveyors Songa Ogeda and Associates who are demanding payment. They also engaged Feradron Associates. They are services Engineers who are demanding money. They also engaged professional consultants -structural and civil engineers JEO/08A – Bill of quantities 60% of the money =due to them was to be paid to the consultants that the Plaintiff hired. 60% of the value of the contract which is Kshs. 50,460,000. Out of the Kshs. 84,100,000 the Plaintiff said he was paid Kshs. 26,073,495. This is almost half of what he owed the other contractors. That the failure to pay has frustrated and stressed him terribly. That in order to work on the contract they had to borrow loans which interest is charged at bank rate which is Central Bank rates plus 3%. He said his company is affected because they had to pay rent, pay employees e.t.c. PW1 said it was not right that the defendants to claim that they did not discharge their duties to them. The defendants did not write demanding for refund of the payment made to them. He said that his contract has not been terminated and the 3 contractors that were awarded the contract have also not been paid. He said that the losses suffered as a result of breach of contract is specified in the plaint. The defendants failed to perform their contractual obligation. The Plaintiff said he had struggled to run the company and he had incurred costs in the engagement and he would like to be awarded general damages for loss suffered. He said he also wanted to be paid for the amount of money pending together with interest and costs. In cross examination by Mr. Okeyo Advocate the PW1 said that they became aware of the tender on 9.5.2019 when they saw it in the newspapers. It was a public tender. It was governed by Public Procurement and Disposal Act. He said he didn’t bring the advertisement to court. PW1 said he did take out a bid and submitted to the county. The bid was submitted in May 2019 on the day of the Tender opening. He said he could tell when tender was opened if he checked records. He said their letter of Award refers to the date that bid was opened. The letters of award are dated 9.5.2019, the date when bids were opened, PW1 said he is sure one of their people attended for opening of bid. Technical proposal – the bid document Exhibit -14 is dated 6.5.2019. The bid document was presented on 9.5.2019. The same document in court bears the same date. The tender was awarded on 14/5/2018 according to the Defendant but the tender was in 2019. The defendants should tell the court tender was awarded within 2 days of bidding. Request for proposal – Exp 14- after the contract was signed in June 2019. PW1 said that they did preliminary designs followed by 2nd stage of final drawings and the 3rd stage was detailed designs or tender documents. Exp 3 and 7 – Contract signed on 7.6.2019 was signed by Dominic Chiange – Director Governance and Administration. PW1 said he did not know who signs contract on behalf of the County Government. The Accounting officer for the County is the County Secretary. The value of the contract of Kshs. 84,100,000 is based on project estimates. The project estimates were Kshs. 580,000,000/= and they charged 12.5% charges for renovations on buildings which are regulated by Cap 525 – Architects and Quantity Surveyors Act. PW1 said that it is not correct that their charges should not exceed 6%. The provision for 6% is there in the Act. There is Provision for 10% for renovation. The claim they filed in court does not indicate he is claiming on behalf of other professionals that they engaged to help them with the work. Under the Act 6% is supposed to be 6% of the total costs. Cap 525 also provides for Quantity Surveyors charges. The services they rendered involved other 3rd parties and they made claim on behalf of all of their team. When doing outline proposal, one charges according to Cap 525 or Ministry of Public works or World bank. That it is legal and binding if the proposal given is and accepted by the client. Public Procurement and Assets Disposal Act governs procurement by counties. Preliminary design is dated - Expt -9 is not dated. He said he could tell from the records when it was prepared. The document has the company logo. The document was prepared in their office and he didn’t sign it. PW1 said he would have to verify when it was delivered to the client. The 2nd stage is final design Exp 10. is not dated or signed but it has their company logo. He again said would have to look at their file and verify when the design was submitted/delivered to the defendant. The 3rd stage is detailed design Exp 11. It has no date and it is not signed but it has no logo. He said he could not tell when it was submitted and discussed with the defendant. The drawings are approved after final design stage but before going to tender. Government Project/drawings do not go for approval. PW1 said he was engaged as private Architect and they prepared tender documents. He said they are normally involved in advising on the best agent to carry out the contract, but the client determines on whom to give. We knew who the contractor was when they called to hand over the site. The contractor used their drawing to get the tender awarded to them. We have the letter confirming the tender was awarded to a contractor. The award was made to 3 contractors to construct County Headquarters another the Governor’s House and third one Deputy Governor’s House. PW1 said that their contract with the County Government has never been terminated. He said they should have been paid in 2021 and that is why they were seeking to be paid damages. The contract is still alive. The contract he executed provided for termination clause. The contract also provides for interest on delayed payment. The documents they presented are all electronically generated. In re-examination by Mr. Ayayo Advocate, PW1 said that the County Secretary delegated authority to sign the contract between the Plaintiff company and the County Government. The contract had timelines for payment as 30 days after fee note is received and/or submitted. The fee note was given on 7.1.2021. The condition was not fulfilled and the contract was breached because the defendant failed to fulfil their part of the contract. At the close of Plaintiff’s case, the Defendant called the County Secretary Mr. Oscar Olima who testified and said that he did record and sign 2 witness statements dated 19.9.2023 and 29.9.2023 which he said he wished to adopt as his evidence in chief. The Defendant’s witness said that he wished to inform the court that he had not come across any document in relation to the claim herein. Purported contract dated 7.9.2019 between the plaintiff and defendant. Directors Governance and Administration Mr. Dominic Chiange signed on behalf of County Government He said that under Public Procurement Act and Government Contracts Act the Accounting Officer was to sign the contract. In this case it is the Chief Finance Officer checking on the records there is no record of plans represented for approval for this particular project. Exp letter dated 14.5.2018 from County Government to plaintiff. Bids were opened on 9.5.2019 and the bid was awarded on 14.5.2018. The award letter is irregular as date of award precedes date of opening bid. We have filed a counter claim for Kshs. 27,000,000 because we felt money was paid against services that were not rendered by the contractor. In cross examination by Ms. Mawinda Advocate DW1 said that there is no contract going on at the site. Letter dated 31.3.2021 written to the plaintiff by the defendant asking that plaintiff hands over the site had been shown to him. He said he was not aware that the Plaintiff had reached 4th schedule of the works. The County Government was involved in signing the contract. He said he was personally not involved in signing of the contract. After fee note was raised by Plaintiff, they did not demand refund but they filed counter claim dated 12.8.2022 and amended on 29.9.2022. The Plaintiff was not paid balance for the amount of work done- the position of County Government is that invoice raised was erroneously paid because no work was done and payment of any balances could not have arisen. In re-examination by Mr. Okeyo Advocate, DW1 said that **i**t is their evidence that from review of records, process of obtaining contract was irregular. The payment made in respect of irregular contract was loss to Government Revenue and should be refunded **ANALYSIS AND DETERMINATION** Based on the pleadings, the evidence tendered by the respective parties as well as their submissions, the central issue for determination is whether the Plaintiff proved, on a balance of probabilities, that there existed a valid contract, that he performed his obligations under the contract up to the third milestone, and that the Defendant breached the contract by failing to pay the agreed fees. The Plaintiff produced the consultancy agreement dated 7 June 2019; Letter of acceptance and award; Fee notes; Drawings, designs and tender documents allegedly prepared pursuant to the contract and evidence of part payment by the Defendant amounting to Kshs. 26,073,495. The Defendant challenged the legality of the procurement process and the authority of the officer who signed the contract on behalf of the County Government. However, the Defendant did not produce procurement records, minutes, or any documentary evidence demonstrating that the contract had been nullified, cancelled, or declared illegal by any competent authority. More importantly, the Defendant admitted that payment was made to the Plaintiff under the impugned contract. Such payment is a strong indication that the County Government recognized the contractual relationship. This court therefore finds that a contractual relationship existed between the parties herein. On whether the Plaintiff performed its obligations, PW1 testified that it completed the preliminary design stage (20%); it completed the final design stage (25%), it completed the detailed design and tender documentation stage (30%) and the project progressed to the point where the Plaintiff was invited to hand over the site to contractors on 31 March 2021. The invitation to hand over the site is particularly significant because it tends to demonstrate that the Defendant had accepted and utilized the Plaintiff's designs and tender documents in procuring contractors. The Defendant's witness said "Letter dated 31.3.2021 written to the plaintiff by the defendant asking that plaintiff hands over the site has been shown to me." The Defendant produced no expert evidence to show that the drawings or consultancy services were deficient or incomplete. The Defendant also did not produce any demand letters issued before litigation complaining of non-performance. Consequently, the Plaintiff's evidence on performance remained substantially uncontroverted. This court therefore finds that the Plaintiff proved completion of the first three milestones under the contract. On whether the Defendant breached the contract, the consultancy agreement provided for staged payments and the Plaintiff produced fee Note dated 24 June 2019; fee Note dated 7 January 2021 and demand letter dated 10 March 2022 and the evidence was that payment was to be made within 30 days after submission of a fee note. The Defendant admitted that the Plaintiff was not paid the balance claimed and that no payment was made after the fee note. He also said that there was no formal termination of the contract between the parties. In the circumstances the Plaintiff having completed the first three stages and submitted the corresponding fee notes, the Defendant was contractually bound to make payment. Failure to pay for services rendered constitutes a breach of contract. It is therefore this court’s finding that the Defendant breached the contract by failing to pay the outstanding consultancy fees due for work completed. The Defendant's defence largely rests on alleged procurement irregularities, which included anomalies in dates appearing on procurement documents; alleged lack of authority of the signatory and alleged non-compliance with procurement laws. However, no procurement records were produced to substantiate the allegations. The Defendant did not produce audit report, investigation report, or decision of a court or statutory body declaring the contract was void. The Defendant accepted services and made substantial payments under the same contract. A party cannot ordinarily approbate and reprobate by accepting benefits under a contract and later denying its existence without cogent evidence. The defence is therefore insufficient and cannot defeat the Plaintiff's claim. In their counterclaim the Defendant sought for refund of approximately Kshs. 27,000,000 allegedly paid for services not rendered. The burden lay on the Defendant to prove what services were not rendered, the value of those services and why erroneous payments were made. The defendants failed to discharge this burden as no technical evidence was called, no expert report produced nor was any documentary evidence produced showing that the Plaintiff failed to deliver the contracted outputs. In those circumstances, the counterclaim fails on its face. The Plaintiff claimed special damages for breach of contract in the sums of Kshs35,121,900/= being the balance due and owing for the first three completed stages. The amount claimed is specifically pleaded and supported by the contract document; fee notes and evidence of partial payment. Having found above that the Plaintiff proved on a balance of probabilities that the contract between it and the Defendant was breached this court hereby awards the said amount as claimed together with interest at court rates from the date of filing until payment in full. Although the Plaintiff pleaded general damages for distress, inconvenience and disruption of business operations, the general rule is that general damages are not ordinarily recoverable for breach of contract. A party is generally compensated through damages that place him in the position he would have been had the contract been performed. The Plaintiff's complaints regarding stress, loans, rent and operational difficulties would not ordinarily justify an award of general damages absent exceptional circumstances. This prayer therefore fails and is dismissed. Having substantially succeeded, the Plaintiff is also awarded costs of the suit. In conclusion the following orders are hereby made:- 1. A valid consultancy contract existed between the parties. 2. The Plaintiff substantially performed the first three stages of the consultancy services. 3. The Defendant accepted and utilized those services. 4. The Defendant breached the contract by failing to pay the outstanding consultancy fees. 5. The Defendant failed to prove the alleged procurement irregularities or the counterclaim. 6. Judgment should therefore be entered for the Plaintiff for **Kshs. 35,121,900**, together with applicable interest and costs. 7. The claim for general damages for breach of contract should be dismissed. **DATED, SIGNED AND DELIVERED AT MIGORI THIS 25th DAY OF JUNE, 2026.** **HON. ANNE ADWERA- ONG’INJO** **JUDGE** **In the Presence of:** **Victor – Court Assistant.**