https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/10519

R**EPUBLIC OF KENYA** **IN THE HIGH COURT OF KENYA AT KISII** **CASE NUMBER: HCCA/E152/2024** **ESTHER KEMUMA…………………………………………..APPELLANT** **-VERSUS** **FLORENCE KEMUMA ………………..…………………RESPONDENT** ***(Appeal rising from the Judgment/decree in Kisii Small Claims Court Claim No. E087 of 2024 by Hon. CC. Rono (RM) delivered on 11th of June 2024).*** **JUDGMENT** **Background** 1. The Claim was commenced vide a Statement of Claim filed by the Appellant Esther Kemuma against the Respondent Florence Kemuma at the Small Claims Court. The Claim was for a Judgment of a sum of Kshs.97,000/=; interest thereupon until payment in full; and costs to be assessed by the Court. 2. It is the Appellant’s case that sometimes in 2013, she advanced the Respondent a sum of Kshs.150,000/= sums which were partially paid leaving out a balance of Kshs97,000/=. By way of her Claim the Appellant stated that the Respondent paid the last instalment on/or about 30th September 2020. 3. Upon service of the Notice of first Mention, the Respondent entered appearance and filed a response to the statement of claim dated 24th May 2024. In her response, the Respondent denies ever owing a sum of Kshs.97,000 to the Appellant and asserts that the Claim is time bared and an illegal contract for reason that the Appellant is not a registered lending agent under the Banking Act. 4. The Respondent further admits the claim on a without prejudice basis that the only outstanding amount is Kshs 40,000/= and the Appellant is being deceitful by claiming Ksh 97,000/=. 5. The matter was reserved for hearing, parties consented to proceed underSection 30 of the Small Claims Act and both parties relied on the documentary evidence on record. Parties equally filed their respective submissions. The Appellant filed her written submissions dated 9th June 2024 and the Respondent filed her submissions dated 4th June 2024. 6. In its Judgment, the trial court held that the claimant’s suit is time barred and filed out of time as pursuant to ***Section 4(1) of the Limitation of Actions Act. CAP 22***. Further the court held that it could not deal with the substantive issues raised because the statutory limitations goes to jurisdiction, which the court is now bereft and that no extension was sought, as such the claim was struck outs with costs. **The Appellant’s Case** 1. The Appellant being dissatisfied with the entirety of the Court’s Decision and vide Memorandum of Appeal dated 10th day of July 2024 sought the following summarized grounds: ***That the Learned Trial Magistrate erred in law in holding that this claim was statutorily time barred without making reference to the last remittance/installment made by the Respondent to the Appellant, dismissing the Appellant’s Claim where part of the claim was admitted by the Respondent and decided the case against the weight of evidence on record delivered by the Appellant.*** 1. The Appellant argues that the learned Trial Court ignored the fact that there was a part payment done on or about September 2020. It is further argued by the Appellant that the trial court ignored the fact that the Respondent admitted her indebtedness to a tune of Kshs 40,000/=. **The Respondent’s Case** 1. It is the Respondent’s case that the Appellant instituted the claim well beyond the statutory limitation period of six years. That also the trial court rightly held that the suit was brought after six years after the alleged breach, and therefore time-barred. Further that the Appellant did not dispense the burden of proof or provide and evidentiary proof in support of the alleged last payment that would precipitate a cause of action. **Analysis & Determination** 1. The Appellate court herein has considered the record of appeal, the pleadings and original record of the proceedings as well as the rival submissions. This being the first appeal, I am guided by the principles set out in the case of ***Selle v Associated Motor Boat Co. [1968] EA 123*** wherethe Court of Appeal for East Africa set out the duty of the first appellate court in in the following terms: ***“An appeal to this court from a trial by the High Court is by way of retrial and the principles upon which this court acts in such an appeal are well settled. Briefly put they are that this court must reconsider the evidence, evaluate it itself and draw its own conclusions though it should always bear in mind that it has neither seen nor heard the witnesses and should make due allowance in this respect..”*** 1. From the foregoing, an appellate court would rarely disturb a finding of fact made by the trial court, unless the finding was made on a wrong principle or based on no evidence in arriving at the finding it did. **See Ephantus Mwangi & Another v Duncan Mwangi Wambugu [1982 – 1988] IKAR 278.** 2. I have analysed in totality the entire record at the subordinate court as well as at the appeal stage and framed the following issue for consideration; *Whether the Appellant’s Claim is time barred and whether the Appellants claim is merited*. 3. The Appellant’s appeal herein mainly challenges the finding of the learned trial court that the claim was time barred. The Memorandum of Appeal outlines three grounds. In summary the Appellant is aggrieved that the trial court did not factor the that the last payment was done on or about September 2020 giving rise to a new cause of action and lastly there was an admission of indebtedness of Kshs 40,000 by the Respondent. 4. The Trial court in Paragraph 6 of its judgment relied on **Section 4(2) of Limitations of Action Act** wherein it provides that an action founded in tort may not be brought after the end of three years from the date on which a cause of action arose 5. For clarity, the issue in dispute herein is friendly loan as such a claim for debt recovery Section 12 (1) b of the Small Claims Court Act. The issue in question being a contract its limitation is provided under Section 4(1)(a) of the Limitation of Actions Act which provides a six-year limit for actions founded on contract. 6. Further **Section 23** of the Act provides for extension on limitation of Actions Act and particular when a debt is acknowledged or partly paid. This is a curative and justifiable exception created by parliament to save legitimate extinguishing causes/claims. 7. **Section 23 (3) of the Act** on fresh accrual of right of action provides as follows: ***“Fresh accrual of right of action on acknowledgement or part payment where a right of action has accrued to recover a debt or other liquidated pecuniary claim, or a claim to movable property of a deceased person, and the person liable or accountable therefore acknowledge the claim or makes any payment in respect of it, the right accrues on and not before the date of the acknowledgement or the last payment.”*** 1. The court then posits how can a debt be acknowledged to precipitate a fresh accrual of right of action? ***Section 24 of the Act*** provides for the formal requirements of acknowledgment as follows: ***“(1) Every acknowledgement of the kind mentioned in section 23 of this Act must be in writing and signed by the person making it.*** ***(2) The acknowledgement or payment mentioned in section 23 of this Act is one made to the person, or to an agent of the person, whose title or claim is being acknowledged, or in respect of whose claim the payment is being made, as the case may be, and it may be made by the agent of the person by whom it is required by that section to be made.”*** 1. From the above, any action of part payment of an existing debt, which is otherwise time barred or any acknowledgment in writing made in relation to the debt, gives rise to a renewal of the limitation period from the date of acknowledgment or part-payment. 2. The Appellant argues that the learned Trial Court ignored the fact that there was a part payment done in the year 2020. 3. It is further argued by the Appellant that the trial court ignored the fact that the Respondent admitted her indebtedness to a tune of Kshs 40,000/=. 4. Upon perusal of the Record of Appeal and the trial court file I note that the Respondent in her Response to Statement of Claim and Witness statement dated 22nd May 2024 admitted to the debt but only to an extent of Kshs 40,000. The same as been reproduced as follows; ***“That I was lent Kshs 150,000 by the Claimant herein in the year 2013 following a verbal agreement. By the time of filing this case. I had paid a sum of Kshs 110,000 and the only outstanding amount is Kshs 40,000*** ***…I am not contesting the fact that I owe the claimant money but I insist the correct amount is Kshs 40,000”*** 1. Clearly the Respondent admitted to the Claim in her statement which is dated and signed by her at the foot of the document, she further insists that she is not contesting the debt but only the extent of the debt. 2. On part payment she further avers that she has been paying the debts in instalments since 2013, and she does not dispute as to whether the last payment was made on or about September 2020. 3. The Respondent submits that the Appellant instituted her claim well beyond the statutory limitation period. That also the trial court rightly held that the suit was brought after six years after the alleged breach, and was therefore time-barred. Further that the Appellant has not provided any proof to support that the last payment was done in the year 2020. 4. It is the submission of the Respondent that the Appellant did not satisfy the legal requirements for part payment that would accrue a fresh cause of action. 5. However, the Small Claims Court as established is guided by the principles of judicial authority espoused under ***Article 159 of the Constitution*** which obligates courts to administer justice without undue regard to procedural technicalities. 6. ***Section 3 of the Small Claims Act*** provides that the court shall adopt such procedures as the Court deems appropriate to ensure the timely disposal of all proceedings before the Court using the least expensive method; equal opportunity to access judicial services under this Act; fairness of process; and simplicity of procedure. 7. Further the court being sui generis will be guided by its own procedures wherein it is equally vested with inquisitorial powers including calling for evidence and summoning witnesses. The court is equally vested with powers to enter judgment on admission of the parties. Lastly the court whilst being guided by rules of natural justice is not be bound wholly by the rules of evidence. 8. That being said, clearly there was an admission on the part of the Claim and that also there was a payment scheduled which showed a payment done in 2020. The admission of this document was not objected, indeed parties opted to proceed by way of documents only. 9. The High Court in ***Nyandarua in Irene Wambui Ndugo vs Board of Management Sacred Hearts Kangaita Secondary School 2026 eKLR*** while faced with a similar appeal held as follows; *There was a written admission of the existence of the debt by the respondent and an intention to settle the same. Further, at the preliminary stage, the court was not required to conclusively determine the evidentiary weight of those messages but only to ascertain whether they disclosed evidence that would defeat a limitation of action objection.* 1. As guided by the above persuasive authority the court prematurely entertained a preliminary objection which was marred with facts despite there being evidence of admission. This fact ought to have been first ascertained. ***See Oraro v Mbaja [2005] 1 KLR 141.*** 2. Consequently, the trial court fell into error when it sustained the preliminary objection without considering the adduced evidence regarding the Respondent's acknowledgment of the debt and part payment that was material to determining whether a fresh cause of action had accrued. The preliminary objection was, for this reason, both improperly raised and improperly upheld. 3. This court subsequently declares that the evidence regarding the alleged part payment made in 2020 required determination before the question of limitation could properly be resolved. **Disposition** 1. Consequently, this court makes the following orders; 2. The appeal is allowed. 3. The judgement of the Small Claims Courts that the Appellant’s claim was statute bound is hereby set aside 4. This matter is remitted to the Small Claims Court before a different Adjudicator for hearing and determination solely on the outstanding balance payable. 5. Since the appeal succeeds on the point of law and the respondent nevertheless admitted the existence of the debt while disputing the balance, each party shall bear its own costs of this appeal. **DELIVERED VIRTUALLY, DATED AND SIGNED AT NAIROBI THIS 9TH DAY OF JULY 2026.** 1. **M. OKUTOYI** **JUDGE** **In the Presence of:** **Mr. Soire for the Appellant.** **Mr. Masolo for the Respondent.** **Ruth Mokeira-Court Assistant.**