[2016] KEHC 8342 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT NAIROBI

COMMERCIAL AND ADMIRALTY DIVISION

CIVIL SUIT NO. 562 OF 2014

GIDEON NJOROGE MUIGAI…….........…………….……………………............PLAINTIFF

VERSUS

EDWARD MUIGAI……………………..…………………………………1ST DEFENDANT

PATRICK MUGI KAMAU………………………………………………..2ND DEFENDANT

RULING

1. The application dated 8th July 2015 was brought by the 1st defendant, who requests the court to either strike out his name as a party to this suit, or, alternatively to strike out the suit against him.

2. It is the case of the 1st defendant, EDWARD MUIGAI, that at all material times he was acting as an agent of the 2nd defendant, PATRICK MUGI KAMAU.

3. Secondly, the 1st defendant pointed out that he was neither the registered owner of the suit property nor a beneficiary of the flats which were to be developed on the said property.

4. The applicant drew attention to the fact that the plaintiff’s claim was for the payment of the costs for the construction of the apartments, which would be the property of the 2nd defendant.

5. When the plaintiff was served with the application, he reiterated that it is the 1st defendant who had signed the Agreement dated 16th April 2012.

6. The 1st applicant confirms that he did sign the said Agreement, however, he insists that he did so on behalf of the 2nd defendant.

7. The 1st defendant also points out that the 2nd defendant and the plaintiff signed another Agreement, dated 8th February 2014.

8. Therefore, the 1st defendant emphasized that his sole role in the whole transaction was limited to the transmission of funds from the 2nd defendant, to the plaintiff.

9. The applicant described himself as having been a mere facilitator to the transaction between the plaintiff and the 2nd defendant. In effect, the 1st defendant denies having ever been a party to the contract between the plaintiff and the 2nd defendant. Therefore, his contention is that he could not ever be held liable for non-performance of a contract which he was not a party to.

10. In the circumstances, the 1st defendant was of the view that he ought not to have been enjoined to the suit. That is why he now asked the court to strike out his name from this case.

11. The 1st defendant believes that the removal of his name from the suit would not be prejudicial to the plaintiff’s case.

12. Furthermore, the 1st defendant submits that the plaint has not disclosed any cause of action against him. Therefore, the applicant reasoned, that it was just that his name be struck out from the suit, as his presence was not necessary in order to enable the court to effectively and completely to settle all questions involved in the suit.

13. The applicant appreciates that the court’s power to strike out a party from a suit was not mandatory, but was permissive.

14. In this case, the applicant’s view was the court should exercise its discretion in his favour, as there was no act on his part which could be said to have given the plaintiff, a cause to complain against him.

15. The applicant pointed out that the 2nd defendant had not raised any opposition to the application, therefore, the applicant views that as evidence that the 2nd defendant did not rubut the applicant’s contention that there was no contractual relationship between the plaintiff and the applicant.

16. In his assessment, the 1st defendant says that he was only unlucky to have been caught in the cross hairs of the plaintiff and the 2nd defendant.

17. The applicant reiterated that his involvement in the agreement;

“was on the basis of the 2nd Defendant’s authority, who has averred authoritatively in the matter, to be the party which entered into an agreement with the plaintiff?.

18. It was the understanding of the applicant that the issues for determination do not involve him directly or indirectly.

19. In determining the application, I first take note of the assertions in the plaint.

20. At paragraph 4 of the plaint, it was asserted that the person who entered into the Agreement with the plaintiff was the 1st defendant.

21. At that time, the 2nd defendant was said to have been residing and working for gain in the United States of America.

22. The plaintiff was aware that the building to be erected on the suit property belonged to the 2nd defendant.

23. It was the plaintiff’s case that there was a verbal agreement between the 2 defendants, pursuant to which the 2nd defendant was to send money from the USA, to the 1st defendant, who would then transmit it to the plaintiff.

24. According to the plaintiff, the funds from America were delivered to him by the 1st defendant. However, the plaintiff was of the view that the figures did not tally, presumably between the sums allegedly sent by the 2nd defendant and the sums remitted to the plaintiff.

25. The plaintiff’s further claim was that both the defendants had threatened to force him out of the property. But because the defendants had not paid him some Kshs. 4,949,451/- which the plaintiff had spent on the project, and also because there were other materials stored on site and in the premises, the plaintiff filed this suit.

26. In an affidavit sworn on 12th August 2014, the plaintiff stated that the 2nd defendant had agreed to make good the debt. The parties even signed an Agreement dated 8th February 2014, in an attempt to resolve the dispute.

27. In that Agreement, the 2nd defendant expressly stated that he;

“had contracted the service provider, (GEDION NJOROGE MACHARIA), to construct an apartment in Juja at a cost of forty million and in the course, some variation were done in the construction and an extra one unit was factored in per floor?.

28. Notwithstanding that agreement, the 2nd defendant had not resolved the dispute.

29. On a prima facie basis, the Agreement dated 8th February 2014 appears to confirm that the contract for the construction of the apartment in Juja was between the plaintiff and the 2nd defendant. If that be the case, as the 1st defendant has said all along, it should be possible to conclude that the matters in dispute can be sorted out between the plaintiff and the 2nd defendant.

30. But there is a Replying Affidavit sworn by the 2nd defendant, dated 16th September 2014, which paints a totally different picture.

31. The 2nd defendant deponed that he never instructed the 1st defendant to enter into any Agreement with any Third Party, in respect to the construction of the apartments in question.

32. According to the 2nd defendant, the person who was to put up the structure was the 1st defendant. Secondly, the money for the construction was to be remitted by the 2nd defendant, “in small bits?.

33. The impression created by the 2nd defendant was that nobody should have been incurring any expenditure on his behalf, before he remitted money.

34. The 2nd defendant denied ever having authorized the 1st defendant to enter into the Agreement dated 16th April 2012.

35. Indeed, the 2nd defendant exhibited his passport to show that on the date when the plaintiff and the 1st Defendant signed the contract dated 16th April 2012, he was in Kenya. Therefore, the 2nd defendant says that there would have been no reason why the 1st defendant needed to sign that Agreement on his behalf.

36. The other issue raised by the 2nd defendant was that the plaintiff had given varying costs of the project, ranging from Kshs. 13. 9 million to Kshs. 18. 2 million.

37. Therefore, even though the 2nd defendant would have wished to resolve the dispute, he denied being liable for the sums claimed.

38. In the circumstances, I find that although the 2nd defendant appears to have confirmed that he is the person who contracted the plaintiff to put up the buildings on the suit land, he also retracted that statement on oath.

39. In the circumstances, the question would be whether the affidavit sworn by the 2nd defendant could override the Agreement in which the said defendant had appeared to acknowledge having contracted the plaintiff.

40. If that affidavit was to be found to constitute an untruth, what would the court do?

41. Is there a possibility that the 2nd defendant entered into the Agreement dated 8th February 2014 only with a view to solving the stalemate which had arisen?

42. If the 2nd defendant was actually present in Kenya at the time when the plaintiff and the 1st defendant signed the Agreement dated 16th April 2012, why would the 1st defendant have been signing the Agreement on behalf of the 2nd defendant?

43. Assuming that the 2nd defendant had authorized the 1st defendant to execute the Agreement dated 16th April 2012, what was the scope of such authority? In other words did the 1st defendant have the requisite authority to bind the 2nd defendant in the manner and to the extent that he purported to do in the Agreement dated 16th April 2012?

44. How much money did the 2nd defendant give to the 1st defendant, for onward transmission to the plaintiff, (assuming that there was such an understanding), and how much was transmitted?

45. In my considered view, the 1st defendant is an essential party to this suit, to enable the court effectively and completely determine all the questions involved.

46. There might arise instances in which either the plaintiff or the 2nd defendant give evidence which may touch on the involvement of the 1st defendant, in the matters in issue. If that were to happen, whilst the 1st defendant had been exempted from participating in the proceedings, it might be construed that he was then been adversely mentioned when he did not have an opportunity to respond to any such allegations or such evidence.

47. Accordingly, I find that it is necessary to have the 1st defendant remain as a party to these proceedings.

48. On the issue of the costs of the application, I hold that the same shall be in the cause. If the plaintiff’s case was to finally succeed against either the 1st defendant alone or against both defendants, the plaintiff would be awarded the costs of the application dated 8th July 2015.

49. But if the suit against the 1st defendant is not successful, yet the plaintiff succeeded against the 2nd defendant, the costs of the 1st defendant would be payable by the 2nd defendant.

50. Finally, if the suit was unsuccessful against both defendants, the costs of application dated 8th July 2015 would be paid by the plaintiff, to the 1st defendant.

DATED, SIGNED and DELIVERED at NAIROBI this3rd day of November2016.

FRED A. OCHIENG

JUDGE

Ruling read in open court in the presence of

Ayora for the Plaintiff

No appearance for the 1st Defendant

No appearance for the 2nd Defendant

Collins Odhiambo – Court clerk.