Gicimu v Miano [2025] KEHC 7835 (KLR)
- Citation
- [2025] KEHC 7835 (KLR)
- Status
- Judgment
- Jurisdiction
- Kenya
- Court
- High Court
- Panel
- JK Ng'arng'ar
- Case number
- Civil Appeal E117 of 2022
- Language
- English
More details
- Court
- High Court
- Panel
- JK Ng'arng'ar
- Case number
- Civil Appeal E117 of 2022
- Language
- English
On this page
Professional case brief
Research organized from the available case record
01
Holding and result
The court found that the appellant, while a guarantor, had in fact benefited from the loan proceeds, as part of the funds were credited to his account and some were allegedly transmitted in cash. The court agreed with the lower court that the appellant's denial of benefiting from the loan was not credible. Applying the principle of balance of probabilities, the court held that the appellant failed to discharge the burden of proof to show he did not benefit from the loan. The court further held that privity of contract did not shield the appellant from liability since he was found to have received part of the loan proceeds. Consequently, the appeal lacked merit and was dismissed with costs to the respondent.
Court disposition
appeal dismissed
Orders
- The appeal is dismissed with costs to the respondent.
02
Material facts
Parties
Gedion Muriithi Gicimu
AppellantJohn Kiam Miano
Respondent Counsel: KimataAmounts and remedies
- Loan Amount Advanced: KES 300,000
- Loan Amount Repaid by Respondent: KES 100,000
03
Procedural history
Posture
Civil Appeal / Judgment
04
Questions and positions
Legal issues
- 01
Whether the appellant, as guarantor, was liable for the outstanding loan amount after the respondent defaulted.
- 02
Whether the appellant benefited from the loan proceeds and thus bore liability.
- 03
Whether the lower court erred in its application of the burden of proof and privity of contract.
Party arguments
- Applicant
- The appellant argued that he was merely a guarantor for the loan advanced to the respondent and did not benefit from the loan proceeds. He contended that upon learning of the default and impending sale of his property, he was willing to settle any outstanding balance. He asserted that the lower court erred in finding him liable, as the contractual relationship was primarily between the respondent and the bank.
- Respondent
- The respondent maintained that the loan was taken on behalf of the appellant and that the appellant actually received the loan proceeds, either directly into his account or in cash. The respondent argued that the appellant's denial of benefiting from the loan was not credible and that the lower court correctly found that the appellant was liable based on the evidence and the balance of probabilities.
05
Court’s reasoning
Legal principles
- 01
Selle v Associated Motor Boat Co. [1968] EA 123
The duty of the first appellate court is to re-evaluate the evidence and reach its own conclusions, bearing in mind that it did not see or hear the witnesses.
- 02
Miller v Minister of Pensions [1974] ALL ER
In civil cases, the burden of proof is on a balance of probabilities; the court must decide in favour of the party whose case is more probable.
- 03
General contract law principles
Privity of contract precludes a guarantor from being liable for transactions between the principal debtor and the lender unless the guarantor benefited from the proceeds.
06
Ratio, limits and disposition
Ratio decidendi
The court found that the appellant, while a guarantor, had in fact benefited from the loan proceeds, as part of the funds were credited to his account and some were allegedly transmitted in cash. The court agreed with the lower court that the appellant's denial of benefiting from the loan was not credible. Applying the principle of balance of probabilities, the court held that the appellant failed to discharge the burden of proof to show he did not benefit from the loan. The court further held that privity of contract did not shield the appellant from liability since he was found to have received part of the loan proceeds. Consequently, the appeal lacked merit and was dismissed with costs to the respondent.
Obiter and limits
- The appellate court must always bear in mind that it has neither seen nor heard the witnesses and should make due allowance in this respect.
- A guarantor who benefits from the loan proceeds cannot escape liability by relying solely on privity of contract.
Court disposition
appeal dismissed
- The appeal is dismissed with costs to the respondent.
Source and reliance status
High Court
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Judgment reading view
Judgment text
The complete available source text.
High Court
Judgment
Gicimu v Miano (Civil Appeal E117 of 2022) [2025] KEHC 7835 (KLR) (5 June 2025) (Judgment)
Neutral citation: [2025] KEHC 7835 (KLR)
Republic of Kenya
In the High Court at Kerugoya
Civil Appeal E117 of 2022
JK Ng'arng'ar, J
June 5, 2025
Between
Gedion Muriithi Gicimu
Appellant
and
John Kiam Miano
Defendant
(Being an appeal from the Judgement of Chief Magistrate Court at Wang’uru by Hon. A Lorot(Chief Magistrate) delivered on 25th November, 2022 the case being Wanguru CMCC no 151 of 2015)
Judgment
1. What is before the court for determination is a memorandum of appeal dated 13th December, 2022 filed by the appellant following a judgement that disfavoured him in the lower court.
2. The facts giving rise to the instant suit can found in the Plaint dated 25th May, 2015. The appellant who was then the Plaintiff averred that he is the registered owner of Land Registration number Mwea/Mutithi/1983 which he issued as collateral for a loan the Respondent was advance by the 1st Defendant in the Plaint [Cooperative Bank Limited] of Kshs. 300,000/-
3. The appellant in paragraph 7 of the plaint averred that he learnt that the Respondent had defaulted after being served with a notice of sale dated 26th March, 2015 which he received on 28th March, 2015. He claims in the plaint that he visited the bank’s Branch and was advised that the respondent herein had only Paid a sum of Ksh. 100,000/-. In Paragraph 11 of the plaint the Appellant then plaintiff stated that he was willing to settle any balance that may accrue by March 2015.
Determination 4. I have gone through the rival pleadings and submissions of the parties and from my deduction it is common ground that the main issue for determination is whether appeal has merit.
5. This being a first appeal, the duty of the first appellate court is to re-evaluate the evidence adduced before the trial court and to arrive at its own conclusion whether to support the findings of the trial court while bearing in mind that the trial court had the opportunity to see the witnesses. In Selle v Associated Motor Boat Co. [1968] EA 123 it was held in the following terms: -“An appeal from the High Court is by way of re-trial and the Court of Appeal is not bound to follow the trial judge’s finding of fact if it appears either that he failed to take account of particular circumstances or probabilities, or if the impression of the demeanour of a witness is inconsistent with the evidence generally.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. In particular, this court is not bound necessarily to follow the trial judge’s findings of fact if it appears either that he has clearly failed on some point to take account of particular circumstances or probabilities materially to estimate the evidence or if the impression based on the demeanor of a witness is inconsistent with the evidence in the case generally.”
6. It is not disputed that a loan facility was taken from the bank and was guaranteed by the appellant and that the appellants title deed was indeed used as a collateral in securing the said loan facility.
7. In testimony and as per the record the Respondent claims that he took the loan on behalf of the appellant and that the appellant actually received the said loan proceeds. The Lower court in relying on Miller v Minister of Pensions [1974] ALL ER decided the matter of balance of probabilities.
8. The burden of proof in civil cases on the balance of probability is that when the court is faced with two probabilities, it can only decide the case on a balance of probability, if there is evidence to show that one probability was more probable to absorb liability.
9. I agree with the subordinate court that the privity of contract precluded the appellant from transactions between the bank and the Respondent for reason that he was just a guarantor. It emerged that part of the loan proceeds went to his account let alone the funds alleged to have been transmitted in cash.
10. To this end, I find that the denying that he benefited from the loan proceeds did not deserves the light of day at trial and I therefore agree with the lower court in dismissing the case for lack of merit.
11. I find that this appeal lacks merit and I dismiss with costs to the Respondent.It is so ordered
JUDGEMENT DATED, SIGNED AND DELIVERED VIRTUALLY ON THIS 5TH DAY OF JUNE, 2025 IN THE PRESENCE OF:Appellant present in personKimata for the RespondentSiele/Mark [Court Assistants]……………………………………………J.K. NG’ARNG’ARJUDGE
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