https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/10593

**REPUBLIC OF KENYA** **IN THE HIGH COURT OF KENYA AT SIAYA** **CIVIL APPEAL NO. E004 OF 2026** **FAULU MICROFINANCE BANK…………………………..….. APPELLANT** **VERSUS** **WALTER MUSUNGU MUYODI T/A RHEMAT AUCTIONEERS……………..……..………………………1ST RESPONDENT** **JOSEPH ODOUR OTIENO…………………………….2ND RESPONDENT** **(Being an Appeal from the Ruling of the Hon. John Obeto Manasses delivered on 23rd December, 2025 at Ukwala Chief Magistrate Misc. Applications No. E010-E052 OF 2025)** **BETWEEN** **WALTER MUSUNGU MUYODI T/A RHEMAT AUCTIONEERS………….………………… AUCTIONEER/APPLICANT** **VERSUS** **FAULU MICROFINANCE** **BANK LTD.............................. INSTRUCTING PARTY/1ST RESPONDENT** **JOSEPH ODOUR OTIENO……………….DEBTOR/ 2ND RESPONDENT** **JUDGEMENT** 1. This is an appeal preferred by Faulu Microfinance Bank Limited (the Appellant) against the Ruling of Hon. John Obeto Manasses (RM) delivered on 23rd December 2025 at the Ukwala Principal Magistrate’s Court. By the said Ruling, the learned trial Magistrate dismissed the Appellant’s Preliminary Objections raised across forty-three (43) consolidated matters specifically *Ukwala Principal Magistrate's Court Miscellaneous Applications No. E10 to E052 of 2025*, wherein *Ukwala Misc. App. No. E10 of 2025* served as the lead file. 2. Aggrieved by the said dismissal of its objections, the Appellant moved this Court via a Memorandum of Appeal dated 22nd January 2026 wherein it raised the following grounds of appeal namely;- 3. That the learned trial Magistrate erred in law by failing to find that the Court lacked territorial jurisdiction to hear and determine the 43 matters as the Instructing Party/1st Respondent is based in Nairobi and the Causes of Action having all arisen in Uasin Gishu County and not Siaya County where the trial court is situate thereby rendering the proceedings before the trial court a nullity ab initio for want of jurisdiction. 4. That the Honourable Court failed to properly appreciate, interpret and apply the mandatory provisions of Section 11-15 of the Civil Procedure Act (Cap 21) of the Laws of Kenya on territorial jurisdiction which dictates that every suit shall be instituted in a court within the local limits where the Defendant resides, carries on business or where the Cause of Action arose forming the basis of the Preliminary Objection resulting in a manifest apprehension and misapplication of the law. 5. That the learned trial magistrate misdirected himself in law by making a finding that taxation proceedings between the auctioneer and its client do not constitute cause of action and therefore exempt from the jurisdiction rules provided in Section 11 of the Civil Procedure Act yet the nature of taxation proceedings are such that it attaches liability between two opposing parties and there is no legal basis against which the Court’s finding is predicated against. 6. That the learned Magistrate erred in law by dismissing the supervisory jurisdiction of the High Court which is binding on sub-ordinate courts and in particular dismissing the authority of the High Court stemming from the determination in Bungoma High Court Civil Appeal No. E019 of 2025 which had previously pronounced itself on the same jurisdictional questions between same parties thereby occasioning a miscarriage of justice and contempt for the authority of the High Court. 7. By its ruling of 23rd December 2025, the trial court dismissed the Appellant's Preliminary Objection. The learned magistrate held that the 1st Respondent possessed a valid auctioneer's licence dated 26th September 2025 which permitted practice in Siaya County and further made a finding that the judgment debtor resided or carried on business at Ugunja within the court's jurisdiction. 8. This being the first Appellate court, its duty is to re-evaluate the record of the lower court and subject it to an independent analysis so as to reach its own conclusion as to whether or not to uphold the decision of the trial court. See **Selle vs Associated Motor boat Co. Ltd [1968] EA 123.** 9. The 1st Respondent, Walter Musungu Muyodi trading as Rhemat Auctioneers initiated proceedings in the lower court by filing 43 individual applications for the taxation of auctioneer fees and expenses. These were docketed as **Ukwala Principal Magistrate’s Court Civil Misc. Applications Nos. E010 to E052 of 2025**. 10. The claims arose from instructions issued by the Appellant (Faulu Microfinance Bank Ltd) on 1st November 2022 authorizing the 1st Respondent to execute proclamations and attachments against loan defaulters. 11. Faced with the 43 miscellaneous applications, the Appellant did not respond on the merits; instead, it raised a shield of law by filing Notices of Preliminary Objection to strangle the suits *ab initio*. The Appellant’s objection was anchored on five categorical limbs. 12. To streamline the litigation, the trial court on 3rd July 2025 directed that **Ukwala MCC Misc. App. No. E010 of 2025** serve as the lead file and ordered the Preliminary Objections to be disposed of purely through written submissions 13. On 23rd December 2025, the learned trial magistrate, **Honourable John Obeto Manasses** delivered the impugned Ruling which dismissed the Appellant's Preliminary Objections in their entirety. 14. The Appeal was canvassed by way of written submissions 15. The Appellant filed its written submissions dated **14th July 2025** and submitted before this Honourable Court the following issues for determination; 1. Whether the 1st Respondent was licensed to practice in Ukwala, Siaya County at the material time of proclamation. 2. Whether the debtor resided or carried on business at Ugunja, Siaya County. 3. Whether the trial Court has the territorial jurisdiction to hear and determine the 1st Respondent’s Applications. 4. Whether the Applications filed by the 1st Respondent are fatally defective. 1. On the issue of whether the 1st Respondent was licensed to practice in Ukwala, Siaya County at the material time of the proclamation. Counsel for the Appellant submitted that in the impugned Ruling, the trial Court dismissed the Appellant’s Preliminary Objection on the ground that the 1st Respondent’s auctioneers licence dated 26th September 2025 showed that the 1st Respondent was allowed to practice in Siaya County. The Appellant submitted that the licence that the trial court referred to is dated three years after the proclamation exercises were conducted and that this document is not availed in the 1st Respondent’s Applications for taxation nor was it served on the Appellant. It was further submitted by Counsel for the Appellant that as the record shows, the auctioneers licence produced before the Honourable Court that was valid at the Proclamation exercises is the one dated 5th April, 2022 expiring on 31st December, 2022. It is marked as “WMM-1” in the 1st Respondent’s Notices of Motion. The license is a Class ‘A’ licence which expressly indicates that: “The Licence is limited to the counties of Turkana, West Pokot, Samburu, Trans Nzoia, Uasin Gishu, Elgeyo Marakwet, Nandi, Baringo, Nakuru, Narok, Kajiado, Kericho and Bomet.” [See Page 7 of the Record of Appeal similarly annexed to all of the 1st Respondent’s Notices of Motion for taxation dated 26th May, 2025] Rule 3(1) a of the Auctioneers Rules, 1997 provides that: “A Class A licence shall be a general auctioneering licence limited to specific districts;” Counsel for the Appellant further submitted that the Auctioneers Act and the Rules made thereunder, control and regulate the practice of auctioneering in Kenya. An auctioneer derives his authority strictly from the licence that he is issued. Once such licence geographically restricts the area of operation, any act undertaken outside the licensed jurisdiction becomes ultra vires, unlawful and incapable of implementation of instructions for Proclamation or lodging a legitimate claim for remuneration. In the present matter, the 1st Respondent’s held a class ‘A’ Auctioneers licence which did not authorize operations within Siaya County. Consequently, any purported proclamation undertaken in Ukwala, Siaya County was undertaken illegally and in excess of the authority conferred by the licence. Such an illegality cannot be sanitized through judicial proceedings. Furthermore, the 1st Respondent’s Notices of Motion are dated 26th May 2025 and the licence that the trial Court made reference to is dated 26th September 2025, several months after the subject taxation references were filed making it an odd occurrence, Counsel for the Appellant submitted that a licence issued after proceedings are filed cannot retroactively confer jurisdiction or validity. Accordingly, it was the Counsel’s submissions that because the 1st Respondent was not licensed to practice in Ukwala, Siaya County at the time the proclamation exercises in the year 2022, the trial court erred in finding that the 1st Respondent was allowed to practice in Siaya County and therefore the court had jurisdiction to hear and determine the Applications. 2. On the second issue of whether the debtor resided or carried on business at Ugunja, Siaya County. Counsel for the Appellant anchors his line of reasoning on the statutory dictates that litigants and the Courts are guided by Section 15 of the Civil Procedure Act (Cap. 21) of the Laws of Kenya on the place of suing as will be discussed in further details below. The trial Court by way of Section 15 (c) made a finding that the Debtor herein resides or is carrying out business at Ugunja, Siaya County and therefore the court in Ukwala has jurisdiction to hear and determine the applications. Counsel for the Appellant submitted that no evidence was laid before the trial court to demonstrate that the Debtor is resident in or carries out business in Ugunja, a fact that the Appellant highlighted to the trial court in its Notice of Preliminary Objection. In fact, the 1st Respondent failed to disclose where he carried out any of the 43 proclamation exercises. There is no reference to Unguja, Ukwala or Siaya County in the entire application, sworn statement nor in the documents he filed. There is no indication nor evidence that the Debtor is or was residing or carried on business in Siaya County. Counsel for the Appellant further submitted that they could not therefore assume jurisdiction on the strength that the cause of action arose within the jurisdiction of the Court. Counsel for Appellant relied on the provision of Section 107 of the Evidence Act which lays the burden of proof on the 1st Respondent to prove that the debtor resided in Ugunja and none was proffered before the trial court. In all the annexures furnished by the 1st Respondent before the trial court marked as “WMM-1”, “WMM-2” and “WMM-3” – there is no reference whatsoever to the location of the Debtor, let alone to their location being in Ugunja and therefore the trial court was mistaken to make a finding that that the Debtor is based in Ugunja, and therefore it was seized of jurisdiction. 3. On the issue of whether the trial Court has the territorial jurisdiction to hear and determine the 1st Respondent’s Applications, it was submitted by the Appellant’s Counsel that once the Appellant raised the issue of territorial jurisdiction before the subordinate Court, the learned magistrate was under a legal duty to first satisfy himself that the Court was properly clothed with jurisdiction before taking any further step in the proceedings. Counsel for Appellant submitted that the trial court was notified of a conclusive finding made by the High Court at Bungoma in **Faulu Microfinance Bank Ltd v Julius Onyango T/A Agunja Auctioneers (Bungoma High Court Civil Appeal No. E019 of 2024, Unreported)** regarding the appropriate place of suing. The High Court determined that because the Appellant is a resident of Nairobi, the trial court lacked the requisite territorial jurisdiction to hear and determine the matter. In the aforesaid decision, the Court determined that the debtor was a resident of Trans Nzoia while the Appellant, Faulu Microfinance Bank Ltd was a resident of Nairobi and accordingly, the trial Court lacked the requisite territorial jurisdiction over the Appellant to hear the matter in Bungoma. Counsel for the Appellant relied on the case of **Korea Nyamai v Neema Parcels Limited (2021) eKLR,** where the Court held that civil courts are primarily and expressly required under the provisions of Section 15 of the Civil Procedure Act to protect the Defendant against the burdens of being sued and litigating in distant or inconvenient forums. The Court explained that this ensures that counties through their respective Courts do not reach out beyond their counties as co-equal sovereign in our system of government. Counsel for the Appellant further submits that The High Court has supervisory jurisdiction over the Sub-ordinate Courts and the trial Court was bound by the findings of the Superior Court that it was not clothed with the jurisdiction to hear and determine the matter. Counsel for the Appellant placed reliance on Section 15 of the Civil Procedure Act provides guidance on place of suing. It states that: “Subject to the limitations aforesaid, every suit shall be instituted in a court within the local limits of whose jurisdiction— a. The defendant or each of the defendants (where there are more than one) at the time of the commencement of the suit, actually and voluntarily resides or carries on business, or personally works for gain; or b. any of the defendants (where there are more than one) at the time of the commencement of the suit, actually and voluntarily resides or carries on business, or personally works for gain, provided either the leave of the court is given, or the defendants who do not reside or carry on business, or personally work for gain, as aforesaid acquiesce in such institution; or c. the cause of action, wholly or in part, arises. **Explanation (1)—where a person has a permanent dwelling at one place and also a temporary residence at another place, he shall be deemed to reside at both places in respect of any cause of action arising at the place where he has such temporary residence.** **Explanation (2)—A corporation shall be deemed to carry on business at its sole or principal office in Kenya, or, in respect of any cause of action arising at any place where it has also a subordinate office, at such place.** **Explanation (3)—In suits arising out of contract, the cause of action arises within the meaning of this section at any of the following places, namely— i. the place where the contract was made; ii. the place where the contract was to be performed or the performance thereof completed. iii. the place where in performance of the contract any money to which the suit relates was expressly or** impliedly payable.” Counsel for the Appellant further submitted that there is no contention that the Appellant herein has its principal office in Nairobi, Ngong Lane, off Ngong Road. The annexure marked as “WMM-2 ” of the 1st Respondent’s supporting affidavit which is the letter of instructions by the Appellant to the 1st Respondent confirms that Appellant’s offices are located along Ngong Lane, off Ngong Road and of P. O. Box 60240-00200 Nairobi. This letter of instructions is the legal basis of the debt collection instructions that were issued by the Appellant to the 1st Respondent. The trial court therefore only had the duty to read the face of the document to ascertain that the Appellant carries out its business in Nairobi. It should be noted that the document filed by the 1st Respondent was not controverted by the Appellant and does not contain any conflicting information that would cause the court to doubt the location of the Appellant. The Applications therefore ought to have been filed in Nairobi. The second part of Explanation (2) states that a corporation can also be sued where the cause of action arose where it has a subordinate office. The 1st Respondent failed to disclose where he carried out the proclamation exercises as discussed in issue (b) above. When we turn to the issue of “place where a contract was made” stated at explanation 3 of section 15 of the Civil Procedure Act, we again look at the letter of instruction annexed as “WMM-2” of the 1st Respondent’s supporting affidavit. The letter was signed by the Appellant in Nairobi as the address of the Appellant was well captured as Ngong Lane, off Ngong Road and of P. O. Box 60240-00200 Nairobi. Clearly, this contract was entered in Nairobi. Be that as it may, the other place that one can possibly argue as the place where the contract was made is Bungoma, the address of the 1st Respondent. Certainly, it could never be Ukwala, Siaya County. It was submitted that by virtue of section 15 of the Civil Procedure Act which goes further to provide detailed explanatory notes does not give the 1st Respondent discretion to decide where to institute his applications. The provision is not ornamental. The provisions of section 15 are mandatory and the 1st Respondent must be guided thereof. Counsel for the Appellant relied in the case of **Hangzhou Agrochemical Industries Ltd v Panda Flowers Limited (Civil Suit 97 of 2009) [2012] KEHC 1937 (KLR) (Civ) (8 October 2012) (Ruling),** the Court held: “**Efficient disposal of the business of the court and efficient use of available judicial and administrative resources would necessary demand that as much as possible cases be filed within the jurisdiction of the subject matter so as not to clog other registries while others remain unutilized.”** Counsel for the Appellant submitted that it is apparent that the only proper forum where the 1st Respondent was supposed to commence the proceedings herein was Nairobi where the Appellant is based. The 1st Respondent failed to demonstrate that the cause of action arose in Siaya County, the contract was performed in Siaya County and that the debtor was situated within Siaya County. Counsel for the Appellant further placed his reliance in the decision in **Faulu Microfinance Bank Ltd v Julius Onyango T/A Agunja Auctioneers Bungoma High Court Civil Appeal No. E019 of 2024 (Unreported**) facing similar facts between the same parties found that the trial court could not enjoy jurisdiction over these matters until the provisions of Section 15 are fulfilled. Counsel posits that the provisions of the Civil Procedure Act with respect to the interpretation on territorial jurisdiction gives no room for a party or a suit to be filed against another party in any county or sub-county other than what is contemplated in the above sections of the law. Counsel submitted that giving credence to this provision on territorial jurisdiction ensures that the respective courts do not reach out beyond the limits imposed by the law. The 1st Respondent by instituting the proceedings at Ukwala Law courts while the Appellant is based in Nairobi is a fundamental error that the Court cannot breathe life into it. It is an error that cannot be cured by Article 159 of the Constitution and the overriding objectives of civil litigation. Counsel for the Appellant placed his reliance on the case of **Sawe v Independent Electoral & Boundaries Commission (IEBC) & 4 Others (Petition 8 of 2014) [2015] KESC 7 (KLR) (22 July 2015) (Ruling),** the Supreme Court held that: **“Not all procedural deficiencies can be remedied by Article 159; and such is clearly the case, where the procedural step in question is a jurisdictional prerequisite.”** Similarly, in **Boniface Waweru Mbiyu v Mary Njeri & Another [2005] KEHC 2392 (KLR)** the Court held: **“Whenever a matter is filed before a Court lacking jurisdiction, the professional error there committed is a fundamental one, which cannot be excused as an ordinary mistake by counsel and which should not be held to prejudice the client.… It is incompetent and void in law. ... It is the duty of the Court or tribunal before which such matter is first brought to declare its status as a nullity; and it follows that such matter has no capacity to be transferred to any other Court.”** In view of the foregoing, the Appellant submitted that the trial Court was not clothed with the jurisdiction to hear and determine Ukwala MCC MISC. APPN. No. E010 to E052 of 2025 and therefore the Court ought to have downed its tools and dismissed the Applications with costs. 1. On the fourth issue of whether Applications filed by the 1st Respondent are fatal, the Counsel submitted that the trial court did not address its mind to the other objections raised in the Notices of Preliminary Objection, yet assessment of the validity of the 1st Respondent’s Applications are critically important to the proceedings before the trial court. Counsel contended that the Applicant’s supporting affidavits dated 21st May 2025 bears material inconsistencies that disqualify it as a sworn document. Its annexures refer to attestation performed on 3rd December 2024 while the jurat refers to attestation performed on 21st May, 2025 more than 5 months later. Counsel for the Appellant further submitted that this discrepancy contravenes Section 5 of the Oaths and Statutory Declarations Act (Cap. 15) which demands strict compliance as to the declaration of place and date of the attestation. Following the above, the Applicant’s supporting affidavits to the Applications are defective, with the consequence that the Applicant’s Notices of Motions are unsupported by evidence. Counsel relies on Order 51 Rule 4 of the Civil Procedure Rules provides that every application grounded on evidence must be supported by a valid affidavit and where the affidavit is defective or false, the Motion collapses for want of evidentiary foundation. Further reliance is placed In the case of **Skair Associates Architects v Evangelical Lutheran Church of Kenya & 4 Others [2015] KEHC 7461 (KLR)** the High Court opined that: “not all motions should be supported by an affidavit. Indeed, no affidavit evidence is required where an application has raised points of law. An affidavit is however necessary where the motion is to be supported by evidence.” The present Application seeks to have the Respondent directed to pay auctioneers charges and expenses which are documented in the said defective affidavits, all issues of facts that must be supported by evidence in a valid supporting affidavit. It was the Counsel’s submissions that without a valid affidavit, the Applications must fail, as the grounds in the application cannot be considered nor proved. 2. Opposing the Appeal, the Counsel for the Respondent filed written submissions dated 3rd June 2026 wherein Counsel placed reliance in the case of **Korea Nyamai v Neema Parcels Limited [2021] eKLR**, the learned Judge while giving his determination on territorial jurisdiction quoted the celebrated case of **The Owners of Motor Vessel Lilian 'S' v Caltex Oil Kenya Ltd [1989] KLR,** where Nyarangi, JA (as he then was) in this landmark ruling stated *inter alia*: **"Jurisdiction is everything. Without it, a Court has no power to make one more step. Where a Court has no jurisdiction, there can be no basis for a continuation of proceedings pending other evidence. A Court of law downs its tools in respect of the matter before it, the moment it holds the opinion that it is without jurisdiction."** 1. It was submitted by counsel that the instructing party contends that this Court lacks the jurisdiction to hear this suit. They rely on Section 15 of the Civil Procedure Act (Cap 21) which provides that when filing a suit, a plaintiff must take into account where the defendant resides or carries business or where the cause of action arose. It reads thus: **Section 15 of the Civil Procedure Act:** "Subject to the limitations aforesaid, every suit shall be instituted in a court within the local limits of whose jurisdiction— * **(a)** the defendant or each of the defendants (where there are more than one) at the time of the commencement of the suit, actually and voluntarily resides or carries on business, or personally works for gain; or * **(b)** any of the defendants (where there are more than one) at the time of the commencement of the suit, actually and voluntarily resides or carries on business, or personally works for gain, provided either the leave of the court is given, or the defendants who do not reside or carry on business, or personally work for gain, as aforesaid acquiesce in such institution; or * **(c)** the cause of action, wholly or in part, arises." Counsel further submitted that , it is clear from the record of appeal at pages 8, 9, 10, 19, 20, 21, 30, 31, 32, 41, 42, 43, 53, 54, 55, 65, 66, 67, 77, 78, 79, 89, 90, 91, 101, 102, 103, 114, 115, 116, 126, 127, 128, 133, 137, 139, 150, 151, 152, 162, 163, 164, 173, 174, 184, 185, 186, 195, 196, 197, 206, 207, 208, 217, 218, 219, 228, 229, 230, 239, 240, 241, 250, 251, 252, 261, 262, 263, 272, 273, 274, 283, 284, 285, 294, 295, 296, 305, 306, 307, 316, 318, 327, 328, 329, 338, 339, 340, 349, 350, 351, 360, 361, 362, 371, 372, 373, 382, 383, 384, 393, 394, 395, 404, 405, 406, 415, 416, 417, 426, 427, and 428 which are very clear and alive that the debtors / 2nd Respondent hails from **UGUNJA Sub-County**, which Sub-County is under Ukwala Principal Magistrate's Court and as such well within the territorial jurisdiction of the court. It was Counsel’s submission that, the 1st Respondent herein did proclamation against the debtors at **UGUNJA** and it is alive that the instructing party carries on business in **UGUNJA** and in most parts of the Republic of Kenya. It was submitted by Counsel that the Appellant is not disputing that indeed they issued instructions to the 1st Respondent to recover on their behalf against several debtors in **UGUNJA**, which fact alone shows that the applicant was and is still qualified to do that job, which is why instructions were given. The letter of instruction was duly completed and executed by the instructing party as can be seen on record. Counsel relies on, Section 3(1)(a) provides: "a class 'A' licence which shall be a general auctioneering licence limited to specific districts..." which districts include **UGUNJA** where UKWALA law courts are based. It was submitted by counsel that the Bungoma High Court precedent is not applicable in Ukwala matters as all the debtors hail from Ugunja. Counsel further submitted that the supplementary record of appeal at pages 4, 5, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, and 21 are very alive that the Appellant withdrew instructions from the Respondent to all the branches including Ugunja. It was contended by Counsel for the Respondent that the amended notice of motion which was done with the consent of the Appellant bears no material inconsistencies as can be seen in the supplementary Record of Appeal. Counsel for the Respondent urged the Court that appeal herein lacks merit and should be dismissed with costs to the 1st Respondent in all Ukwala Principal Magistrate Misc. Applications No. E010 - E052 1. I have carefully considered the Appeal, the Ruling of the trial Magistrate and the submission by parties. We shall address the four issues for determination as raised by the Appellant. 2. On the first issue on whether the 1st Respondent was legally licensed to practice in Ukwala, Siaya County at the material time the proclamation exercises were conducted, the Appellant submits that the 1st Respondent’s instructions were issued on 1st November, 2022 for proclamation exercises targeting defaulting customers in Trans Nzoia and Uasin Gishu counties. At that material time, the 1st Respondent held a Class 'A' auctioneer's licence dated 5th April 2022 (expiring on 31st December, 2022) which strictly restricted his practice to specific geographical areas notably excluding Siaya County. The Appellant contends that any acts performed outside the licensed jurisdiction are *ultra vires* and unlawful. Furthermore, the Appellant argues that the trial court erred by relying on a subsequent licence dated 26th September, 2025, which was issued years after the 2022 proclamations and months after the taxation applications were filed in May 2025. 3. The 1st Respondent conversely relies on the trial court's finding that the licence dated 26th September 2025 authorized operations within Siaya County, thus legalizing his stance before the court. 4. To evaluate these competing positions, a review of the regulatory framework governing auctioneers is necessary. Rule 3(1)(a) of the Auctioneers Rules, 1997 explicitly provides that a Class A licence is a general auctioneering licence limited to specific districts or counties. An auctioneer is a creature of statute and derives operational legitimacy entirely from the geographical limits endorsed upon their licence. A comparison of the relevant licences demonstrates the following timeline: | **Document Description** | **Date of Issuance** | **Expiration Date** | **Authorized Geographical Areas** | | --- | --- | --- | --- | | **Operational Licence (WMM-1)** | 5th April, 2022 | 31st December, 2022 | Turkana, West Pokot, Samburu, Trans Nzoia, Uasin Gishu, Elgeyo Marakwet, Nandi, Baringo, Nakuru, Narok, Kajiado, Kericho, Bomet | | **Subsequent Licence** | 26th September, 2025 | 31st December, 2025 | Siaya County (including Ukwala/Ugunja) | It is a basic tenet of law that judicial or administrative documents cannot retroactively cure an illegality unless expressly provided by statute. The proclamation exercises were carried out under the 2022 instructions. At that time, the 1st Respondent had no legal authority to operate in Siaya County. The acquisition of a licence in September 2025 cannot retrospectively validate an unlawful proclamation executed in 2022. As properly guided by the principle that illegality cannot be sanitized through judicial enforcement, the trial court erred fundamentally in using a 2025 licence to validate 2022 actions. This issue is resolved in favor of the Appellant. 1. On the second issue on whether there was any evidentiary basis to establish that the judgment debtor resided or carried on business at Ugunja, Siaya County, the trial court made a definitive finding under Section 15(c) of the Civil Procedure Act that the 2nd Respondent (debtor) resided or carried on business at Ugunja, Siaya County thereby vesting jurisdiction in the Ukwala court. The Appellant strongly contests this asserting that the 1st Respondent failed to provide a shred of evidence linking the debtor to Ugunja or Siaya County, noting that the 1st Respondent’s own motion and supporting statements failed to disclose the location of the 43 proclamation exercises. 2. The 1st Respondent maintains that the cause of action arose within the jurisdiction based on the debtor's alleged presence in Ugunja. 3. Section 107 of the Evidence Act (Cap. 80) places the burden of proof squarely on the party who desires a court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts. If the 1st Respondent asserted that the debtor was based in Ugunja to establish the court’s local jurisdiction, it was incumbent upon him to proffer empirical evidence such as proclamation notices, local addresses, or statutory returns to back that claim. A review of the lower court record reveals that the 1st Respondent's annexures ("WMM-1", "WMM-2", and "WMM-3") contain absolutely no reference to Ugunja, Ukwala or Siaya County regarding the debtor's location. 4. Courts do not rule on speculation or unbacked assertions. In the absence of primary evidence, the trial court had no legal basis to make a finding of fact that the debtor resided in Ugunja. Consequently, the trial court's assumption of jurisdiction on this ground was flawed. This issue is resolved in favor of the Appellant. 5. On the third issues on whether the trial court possessed the requisite territorial jurisdiction to hear and determine the 1st Respondent’s miscellaneous applications, the overarching question is whether the Principal Magistrate's Court at Ukwala had the territorial jurisdiction to entertain these taxation applications. The Appellant argues that by virtue of Section 15 of the Civil Procedure Act, the proper place of suing is Nairobi where the Appellant has its principal place of business or Bungoma where the 1st Respondent is based but certainly not Ukwala. The Appellant heavily relies on a previous decision of the High Court at Bungoma in ***Faulu Microfinance Bank Ltd v Julius Onyango T/A Agunja Auctioneers (Bungoma High Court Civil Appeal No. E019 of 2024)*** where this Court (per Kemei, J.) found under identical facts that the trial court lacked territorial jurisdiction over the Bank. 6. The 1st Respondent’s position in the lower court was that the place of suing is flexible and that the local limits do not divest the court of jurisdiction where a cause of action is asserted. 7. Territorial jurisdiction is a foundational pillar of judicial competence. As famously articulated in ***Owners of Motor Vessel "Lilian S" v Caltex Oil (Kenya) Limited* (1989) eKLR** jurisdiction is everything and without it a court must down its tools. Section 15 of the Civil Procedure Act mandates that every suit shall be instituted in a court within the local limits of whose jurisdiction the defendant resides, carries on business or where the cause of action wholly or in part arises. Explanation (2) explicitly clarifies that: 8. "A corporation shall be deemed to carry on business at its sole or principal office in Kenya or in respect of any cause of action arising at any place where it has also a subordinate office at such place." 9. The undisputed evidence on record, specifically the letter of instructions ("WMM-2") proves that the Appellant's principal office is located along Ngong Lane, off Ngong Road in Nairobi. The contract was made in Nairobi. No subordinate office or cause of action has been linked to Siaya County. 10. As observed by Justice G.V. Odunga in ***Hangzhou Agrochemical Industries Ltd v Panda Flowers Limited* [2012] KEHC 1937 (KLR),** while the High Court enjoys countrywide jurisdiction, the efficient use of judicial resources demands that cases be filed within the correct local jurisdiction so as not to clog certain registries. For subordinate courts, these rules are strictly mandatory. The trial court was bound by the supervisory determinations of the High Court, including the persuasive guidance in ***Korea Nyamai v Neema Parcels Limited* (2021) eKLR,** which underscores that Section 15 protects defendants from the immense burdens of litigating in far-flung, inconvenient forums. 11. By entertaining a matter where the defendant is in Nairobi, the contract was executed in Nairobi and the auctioneer is based in Bungoma, the Ukwala court acted in a total legal vacuum. As established in ***Boniface Waweru Mbiyu v Mary Njeri & Another* [2005] KEHC 2392 (KLR),** a filing before a court lacking jurisdiction constitutes a fundamental professional error rendering the proceedings a nullity ab initio. Such a structural defect cannot be cured by the provisions of Article 159 of the Constitution, as affirmed by the Supreme Court in ***Sawe v Independent Electoral & Boundaries Commission (IEBC) & 4 Others* [2015] KESC 7 (KLR),** which held that procedural steps that constitute jurisdictional prerequisites cannot be bypassed under the guise of avoiding technicalities. Therefore, the trial court lacked territorial jurisdiction. 12. Finally on the last issue as raised by the Appellant on whether the 1st Respondent's underlying applications were fatally defective due to material inconsistencies in the supporting affidavits, the Appellant lastly points out a severe procedural defect: the 1st Respondent’s Supporting Affidavits were dated 21st May, 2025 yet the accompanying jurat and annexures indicate that attestation occurred on 3rd December, 2024 representing a chronological impossibility and a clear violation of Section 5 of the Oaths and Statutory Declarations Act (Cap. 15). The Appellant argues this error strips the motion of any valid evidentiary foundation under Order 51 Rule 4 of the Civil Procedure Rules. 13. The 1st Respondent asserts that the applications are robust and that any formal errors do not prejudice the core claim for remuneration. 14. While it is true, as noted in ***Skair Associates Architects v Evangelical Lutheran Church of Kenya & 4 Others* [2015] KEHC 7461 (KLR)** that affidavits are not mandatory for motions raising pure points of law, they are strictly indispensable where an application seeks substantive reliefs grounded on factual evidence such as the quantification of auctioneer charges. An affidavit whose text is executed months after its purported attestation suffers from a profound integrity defect. Section 5 of the Oaths and Statutory Declarations Act demands exactitude regarding the place and date of attestation. The material inconsistencies in the 1st Respondent's affidavits mean the applications in the lower court lacked a lawful evidentiary foundation. The trial court failed to address this fatal defect, which independently rendered the applications incompetent. 15. In the final analysis, this Court finds that the learned trial magistrate fell into profound error by dismissing the Appellant's Preliminary Objection. The trial court lacked territorial jurisdiction relied on an inapplicable future licence to cure past illegalities made unbacked findings of fact regarding the debtor's residence and ignored fatal defects in the initiating affidavits. Jurisdiction is the lifeblood of adjudication; where it is absent, the court has no power to move forward. 16. In view of the foregoing observations, it is my finding that the Appellant’s appeal has merit. The same is allowed. The Ruling and Order of the Honourable John Obeto Manasses delivered on 23rd December, 2025 is hereby set aside in its entirety and substituted with an order allowing the Appellant’s Preliminary Objection dated 30/6/2025 regarding Ukwala Principal Magistrate’s Civil Misc. Applications No. E010 to E052 of 2025 with the consequence that the applications are struck out with costs. The costs of this Appeal are awarded to the Appellant to be borne by the 1st Respondent. **Dated and delivered at Siaya, this 17TH day of JULY 2026** **D.KEMEI** **JUDGE** **In the presence of:** **Kaula for M/ S Muthoga ……………….for the Appellant** **Wamalwa Simiyu…………………………..for Respondent** **Maureen……………………………………..Court Assistant**