[2023] KEHC 26200 (KLR)

Gids Telecommunications Services Ltd v Mwaka (Civil Appeal 20 of 2020) [2023] KEHC 26200 (KLR) (4 December 2023) (Judgment)

Neutral citation: [2023] KEHC 26200 (KLR)

Republic of Kenya

In the High Court at Makueni

Civil Appeal 20 of 2020

TM Matheka, J

December 4, 2023

Between

Gids Telecommunications Services Ltd

Appellant

and

Peter Mwaka

Respondent

(Being an Appeal from the Judgment and Decree of Hon. Mwaniki J. CM in the Makueni CMCC No.21of 2014, delivered on 9th October 2019)

Judgment

1. This appeal arises from the judgment in Makueni SPMCC 21 of 2014 delivered on 9th October 10 2019, wherein the learned trail magistrate dismissed the plaintiff’s/appellant’s claim and allowed the defendant/ counter claim’s claim.

2. The two claims arose out of what parties refer to as the oral agreement in 2013 – for the appellant to drill a borehole at the farm of the respondent. To enable this, the respondent had procured the services of a hydrologist, who had made out an expert’s report to be followed by the drilling engineer.

3. Taking into consideration the relationship that led to this matter these parties would have been better off with a mediation.

4. That did not happen and before I deliver my judgment I would like to request them to consider the same. This is an opportunity to heal the harm, restore relations and balance losses.

5. Paragraph 4 turned out not to be agreeable to the parties, hence here is my judgement.

6. According to the record and pleadings the parties entered into the oral agreement on 3rd May 2013. The plaintiff was to drill up to 90 meters into the ground and if no water was found – they would re-negotiate further drilling. The plaintiff’s case was that in fact this is what came to pass and they renegotiated and water was found at 138 meters. It is also the plaintiff’s case that it is after the water was found that the defendant chased away the plaintiff and detained its machines.

7. The plaintiff filed the suit seeking the release of its machines namely:i.A rock buster 100 drilling rig with a 26 horsepower Kubota engine.ii.MCM mud pump with 41 horsepower lister engine.iii.37 drill pipe rods and craftsman tool box.iv.Matco spanner and wrenches.

8. The plaintiff claimed that the machines were valued at Kshs. 5. 5 million and that as a result of the detention of the machines, plaintiff had incurred losses of Ksh. 7,318,000/=.

9. The plaintiff sought the following; damages for loss of user at Ksh. 1,000,000/= per quota a year from March 2013; costs of the suit, interest at court rates; payment of Kshs.5. 5 million, the value of the equipment; Kshs. 25,000/= cost of pumping site test.

10. To support this, claim the Plaintiff annexed documents – receipt for test pumping for Kshs. 20,000/=; a bundle of invoices and work order certificates and licences.

11. The defendant filed defence and counter claim. He conceded the oral agreement. He denied holding the plaintiff’s machinery unlawfully – and claimed that the plaintiff was in breach of their contract. He set out the particulars of breach thus;a)Conducting the drilling process in a reckless and unprofessional way.b)Failing to have a supervisor on site during the drilling exercise.c)Failing to follow the specifications given in the survey reporting relation to drilling depth among other specifications ignored.d)Using shoddy and substandard material during the drilling exercise.e)Failing to follow laid down rules and procedure for drilling.f)Causing the borehole to collapse.g)Failing to repeat the said exercise as advised and refusing to refund the defendant the sums incurred in exec of Kshs. 1,600,000/=.

12. He also set out his loss as Particulars of special damages on payments to the plaintiff and/or plaintiffs directors Julius Kyule and Gideon Mwatu on the instructions of Julius Kyule in the following termsa.Paid Julius Kyule by cheque as deposit and first payment on 28/5/13 …………………………………… Kshs. 492,450/=b.Paid Julius Kyule cash on 15/6/2013 ………………... 200,000/=c.Paid Julius Kyule for diesel at Wote market on 11/6/2013 ……………………………………………60,000/=d.Paid Julius at PRD office on 26/6/2013 …………………. 40,000/=e.Paid Julius Kyule cash on 27/6/2013 …………… Kshs. 240,000/=f.Paid one of the Directors Gideon Mwatu for purposes of purchasing casings at Machakos on 29/6/2013….......Ksh 274,000/=g.Paid Mwatu (Kshs. 60,000/= cheque and Kshs. 93,000 cash ……………………………………. Kshs. 153,000. h.Paid Julius Kyule at Nziu market on 10/7/2013 for diesel… ……………………………………Kshs. 72,000/=.i.Paid Gideon Mwatu for gravel, diesel, transport and labour on 12/7/2013/= ………………………………. Kshs. 69,500/=.j.Paid 11/7/2013 for diesel for Almark to remove stuck drilling equipment on the instructions of Julius Kyule ........................ Kshs. 24,000/=.k.Payment to independent Water Consultant Isaac Kilonzo for inspection and report on borehole ……………...... Kshs. 140,000/=.Total….……………………………………………. Kshs. 1,764,950/=.

13. The defendant sought damages for breach of contract, aggravated and exemplary punitive damages against the plaintiff.

14. The plaintiff testified and called two witnesses. Their testimony was basically in support of the pleadings. The defendant also did the same. It is from this evidence that the subordinate court arrived at its decision.

15. The plaintiff/appellant was aggrieved by the judgment of the subordinate court and filed this appeal on the following grounds:i.The learned magistrate failed to consider all issues placed before him for determination hence occasioning a miscarriage of justice.ii.The trial magistrate erred in both fact and in law to suo motu rely on a report filed by the respondent which was contested not marked or produced and or admitted as an exhibit in court and neither was the witness brought to court to produce and be cross-examined. It was not a judicial record despite being filed in court.iii.The learned magistrate failed in law and fact to appreciate that parties are bound by pleadings and need to adduce strict evidence.iv.The learned magistrate erred in law and fact in awarding an omnibus claim of special damages and general damages and breach of contract all under one “pot”.v.The learned magistrate erred in law in awarding an excess of Kshs. 1,624,950/= despite the binding principle that special damage should be strictly proven, there were no such strict even a single receipt.vi.The learned magistrate erred in law of fact by upholding an alleged counterclaim filed on 1st March 2017 without leave of the court for extension on claims of negligence, such claims were an afterthought and not lawfully introduced without leave of the court.vii.The learned magistrate erred in law and fact to award “damages for breach of contract” when no such contract was produced before court and contrary to law. Section 3(1) of the Contract Act. Neither was such damages of breach quantified and specifically proven.viii.The learned magistrate erred in law and fact for holding that the respondent drilled another borehole when on cross examination, he did not produce such evidence to prove the defendant in fact acknowledge that there is “water/shower in the house only that there was little pressure and that was his damage.ix.The honourable court misdirected itself in failure to find out that the plaintiff/appellant had paid for a test pumping and paid Kshs. 25,000/= for the same (receipt of payment) at no time had the plaintiff refused any test pumping, the plaintiff’s counsel concern being a borehole almost 6 years ago without any maintenance.x.The honourable court misdirected itself that notwithstanding the ruling of the court of 12/2/2014 the plaintiff has been lawfully denied usage of its equipment and thus suffered damage.xi.The honourable court misdirected itself in law and fact by failure to award Kshs.5. 5 million value of the rig, equipment and accessories as pleaded and evidenced.xii.All in all, the trial court erred in law and fact by not upholding the plaintiff’s case and dismissing the defence and counter-claimed as urged by the plaintiff/appellant.

16. The appeal was canvassed by way of written submissions.

17. The appellant compressed the 12 grounds of appeal into 3 grounds.

18. On the issue of award of special/punitive damages – the appellant submitted that the claim for special/punitive damages was not established by the respondent and that the court was in error in relying on reports that were not produced by the makers at all. The appellant relied on Abson Motors Limited v Dominic B. Onyango Konditi (2018) eKLR digest no. 1 – for the proposition that special damages must be specifically claimed and, strictly proved.

19. On the issue that damages for breach of contract must be quantified and proven, the appellant relied on Paul Munyoro t/a Spotted Zebra v Bulent Gulbahar Remax Reactors [2016] eKLR to the effect that general damages cannot be awarded for breach of contract because ‘…damages arising from breach of contract are usually quantifiable’. Further that there was evidence of malice on improper motive on the part of the appellant to warrant punitive damages see Board of Trustees NSSF v Judy Wambui Munga [2017] eKLR.

20. It was also submitted that the trial court refused to adhere to precedent and cited Jasbir Singh Rai & 3 Others v Tarlochan Singh Rai & 4 Others Supreme Court Petition 4/2012 [2013] eKLR where it was held that “adherence to precedent should be the rule and not the exception”. Citing Mbogo & Anor v Shah (1968) E.A 93 and 96, Peter M. Karithi v AG [2014] eKLR it was further submitted that the learned magistrate acted in abuse of Judicial discretion.

21. On the issue of the Report upon which the court placed reliance in determining the matter, it was submitted that the court relied on a list of documents not produced as evidence hence offending the guidance of the Court of Appeal in Kenneth Nyaga Mwiga v Austin Kiguta & 2 Others [2015] eKLR and in any event there was no consent to produce the same without calling the makers. See David Ndung’u Macharia -vs- Samuel K. Muturi & Anor Nrb HCCC No. 125 of 1989.

22. On whether the appellant suffered loss and damage as well – it was submitted that the appellant had established the cost of test pumping at Kshs. 20,000/= and the value of its drilling machine at Kshs.5. 5 million. That the plaintiff had also pleaded Kshs. 1,000,000/= per quarter from around 2013 but the learned trial magistrate did not pronounce himself on the same.

23. The appellant submitted that it was entitled to damages for the detention of its drilling rig and its monetary value or the return of the same. It relied on Dharamshi v Karsan (1974) E.A 41.

Respondent’s Submission 24. It was submitted for the respondent that he was a farmer depending in citrus fruits farming who needed a borehole for the supply of water and to that end contracted a hydrologist one J. Ituli (now deceased) to carry out an assessment.

25. It was submitted that the appellant did drill a borehole for the respondent but due to the appellant’s ‘incompetence, incapability, unprofessionalism’ the borehole collapsed sinking with it ‘the hundreds of thousands of Kenya Shillings the respondent had paid. That consequently, the respondent complained to the water department, Ministry of Water and an officer from the Machakos office wrote a report to the effect that appellant had done a shoddy job.

26. It was submitted that the respondent demanded a refund to which the appellant was agreeable with the appellant’s machinery as collateral. The appellant changed his mind and demanded the return of his machinery to which the respondent refused. That the respondent proceeded to dig another bore hole and demanded a refund of his money on the digging of this other borehole but the appellant refused.

27. The respondent submitted in response to the three issues of the appellant’s grounds of appeal.

28. On special and punitive damages, the respondent submitted that the same were set out in his counter claim – and the award was made out of prayer no. C of the counter claim.

29. As to whether the respondent established the special claim for Kshs. 1,624,950/= - counsel submitted that the claim was for Kshs. 1,764,950/= and the same was never denied by the appellant in cross examination. That the Managing Director of the appellant Julius Kyule committed to receiving part of the sum of Kshs. 943,500/=. It was submitted that the respondent particularized his special damages but they were not rebutted by the appellant in cross examination. Counsel relied on HCCC NO. E006/2020 (Kiambu) where the learned Judge quoted extensively from Capital Fish Ltd v KPLC Co. Ltd [2016] eKLR – that it is trite that special damages must not only be plead specifically but must also be proven strictly with as much particulars as possible.

30. It was also submitted that the respondent had discharged the burden to prove its case the respondent cited that majority decision of the Supreme Court in Raila Odinga & Another v 2 Others (2017) eKLR, where the court stated with regard to the evidential burden of proof:Though the legal and evidential burden of establishing the facts and contentions which will support a party’s case is static and remains constant through a trial with the plaintiff, however, depending on the effectiveness with which he or she discharges this, the evidential burden keeps shifting and its position at any time is determined by answering the question as to who would lose if no further evidence were introduced.

31. On the issue of the report, it was submitted that the ‘reports were technical in nature made by competent and qualified personnel’ – that these reports were produced as annexure to the affidavits sworn by the respondent. That the appellant never produced any report on its part on the completion of the task.

32. With respect to the loss and damage suffered by the appellant it was submitted that the appellant produced locally manufactured computer print outs which were only proof that the appellant was out to profit from the respondent.

33. I have carefully considered the record, the submissions by the parties and the authorities cited – the issues that come up for determination are: -i.Whether the appellant established its claim.ii.Whether the expert reports ought to have been admitted without their makers testifying?iii.Whether the respondent established his claim.iv.What orders should issue andv.Who should bear cost?

34. I will deal with the issues not necessarily in seriatim. Let me begin by pointing out an issue that kept popping out of the respondent’s submissions; – reference to material that was not in the Record of Appeal. These references were being made in submissions and counsel referred to documents and urged the court to read them from the court record.

35. Granted, the appeal court is required to read the record of the subordinate court and to be guided by it as the record of appeal but where documents are not in the Record of Appeal, the party making reference to them ought to have raised the issue that the Record of Appeal was not complete before the appeal was set down for hearing, but not in their submissions with respect to the appeal.

36. Did the appellant established its claim?

37. On the claim for general damages, loss of user, wrongful detention, mesne profits at 9,000,000/= per annum from 2013, the record will show that the appellant had, vide a Notice of Motion dated 12th February 2014, sought the release of his machinery from the respondent. This is the same machinery that is subject of this appeal. The learned trial magistrate Hon Ochieng RM found the application was not merited and directed the respondent to continue holding the appellant’s machinery as lien for the money he alleged to have paid the appellant for the drilling of the borehole. The learned magistrate stated that whether the holding of the machinery as lawful or not would be determined at the main hearing, and in any event the appellant had sought damages for loss of user. In his judgment, the learned magistrate who heard the case did not deal with this issue at all. In fact, he stated in his judgment that the appellant’s claim for damages for loss of user could not be determined because, according to him, his learned colleague had admitted the appellant’s prayers and ordered the defendant to “preserve the equipment” and restrained the defendant from removing the same from the jurisdiction of the court. The learned trial magistrate found, in addition, that the plaintiff was in breach of the contract and dismissed as such.

38. It is noteworthy that from the ruling Hon Ochieng Ag SRM dated 28th May 2014 on the application seeking the for release of this machinery, I found no such orders: – there was no order allowing the respondent to keep the appellant’s machinery, and there was no order restraining the appellant from removing the same. The learned Ag SRM stated that the issue of release of the machinery and any damages for retainer/detention would be determined at the trial.

39. The trial magistrate did not make any consideration of the appellant’s case but proceeded to dismiss it on the basis of the above referred ruling – and the one liner – that the appellant was in breach of the contract. Evidently as I have demonstrated from the record, the learned trial magistrate was in error.

40. In his testimony, the appellant’s representative PW1 told the court that after they did their work the defendant complained that the borehole had collapsed and held onto the equipment. He tried to get his equipment back through the police and managed only to get the hired generator released. The rest of the equipment the respondent refused to release. He denied agreeing to the arrangement where respondent would hold onto their equipment until the issue was settled.

41. Accordingly, the respondent, the water was hit at 138 meters but it was not enough. He told the appellant to drill up to 170 meters and he would pay – but the borehole wall collapsed and the appellant agreed to dig another one. He testified that he was forced to dig one by himself and on the day they were to have a joint inspection of the borehole the appellants arrived past 6 pm and no work could bedone. On cross examination he said that the agreement with the appellant was to dig up to 90 meters however the survey book said it was to be 170 meters. He said he would release the machinery upon refund of his money.

42. A perusal of the record shows that there was a hydrological report which is conceded by both parties as what was to guide the whole works. The report states that the borehole would be a maximum depth of 170 meters.

43. However the work sheet that was filed by the appellant indicates it was agreed between the parties that the appellant would drill up to 120 meters – but also contained a clause that that they would drill as per the hydrologist’s survey. That survey report recommended a drilling of up to 90 meters.

44. The appellant’s position is that they were to dig up to 90 meters as per their worksheet. However at 90M there was no sufficient water. It was agreed between the parties that they would dig further. They did this and they found water at 138 meters and were satisfied that this was sufficient.

45. The respondent’s position is that he asked them to dig to 170 meters as per the survey book– and he would pay the extra. That it was In that process that the borehole collapsed – a fact that is denied by the appellant.

46. The question is how the respondent would have invited someone to come and declare the borehole shoddy job without the involvement of the appellant. The appellant maintains they did their job – they struck water, but the respondent raised issues – which led to this situation; however they were never given the opportunity to mitigate the alleged damage.

47. The respondent’s witness to the alleged collapse of the dam never came to testify. Neither did the witness of the alleged inspection hence there was no evidence before the trial court that the borehole had collapsed or that shoddy work had been done.

48. The learned trial magistrate despite having stated so in the proceedings did not address the issue of the expert reports and the effect of the absence of the markers of the report on the evidence of the respondent. Without doing so, he proceeded to rely on the said reports and to determine that the appellant was in breach. The two experts ought to have come to court to testify and if not available, the respondent was bound to present before court evidence – proof that these two witnesses were unavailable, to warrant the admission of their documents in evidence in their absence. Section 33 of the Evidence Act provides for these specific; “Statements written or oral… of admissible facts made by a person who is dead or cannot be found, or who has before incapable of giving evidence or whose attendance cannot be procured without an amount of delay or expense … are admissible in the following cases ….”

49. These specific situations are set out, however the crucial thing is for the party wishing to rely on the evidence of the absent person to demonstrate to court that the person is dead, or cannot come to court for whatever reason. No evidence was placed before the learned trial magistrate as to the unavailability of the respondent’s key witnesses the makers of the crucial reports – hence the magistrate did not lay any foundation for relying on the said reports, and for finding in favour of the respondent.

50. Counsel for the respondent submitted that they had found some evidence on grounds that hydrologist was deceased arguing that the report was not in dispute. However, the reports were disputed and were said to have been made by persons who were alleged to be in Somalia and the US – yet no evidence was placed before the court to support these allegations of unavailability of the expert witnesses. In addition, for one of them, was said to be a government a government employee and if the report was made in their official capacity anyone in that office of the same capacity could have produced the report and answered the requisite questions.

51. Without the said evidence the respondent did not produce any proof to support the allegation that the borehole collapsed at some point.

52. I also found his evidence on the digging of the bore hole inconsistent and not explained. He testified that water was struck at 138 meters but the borehole collapsed at 94 meters. That the drilling was done to 138 meters instead of 175 meters.

53. From the foregoing analysis of the evidence it is my view that a borehole was drilled, water was struck at 138meters and the respondent did not establish that there was any issue with the said borehole.

54. With respect to the machines the respondent alleged that the machines were held with the appellant’s consent. The record and the evidence do not support that position. The appellant’s representative testified that he went to get his equipment from the respondent, and even went to the police. The respondent concedes that this was the position. To add to that the appellant also made an application in the court for the release of the machinery – again this is evidence that there was no consent between the parties that the respondent would retain the appellant’s machinery.

55. The respondent had no authority to detain the machinery. He cannot say that the court allowed him to keep the machinery, the court simply declined to grant the application for mandatory orders. His claim that the machinery was kept at the appellant agreement is not true – the appellant would not have gone to the police/gone to court to seek release of the same if there had been a consent.

56. On damages the appellant pleaded that they had lost millions of shillings in terms of work not done by the fact of the respondent holding their machinery. However, no evidence was availed to court to support the claim of Kshs. 1 million per quarter per year i.e. kshs.4 million per annum in losses – nothing tangible was placed before the court to support this claim.

57. The only document placed before court by the appellant was an invoice for 55,000 USD– no receipts no documents of ownership were produced by the appellant. Similarly the respondent alleged to have paid the appellant money but did not produce any evidence to prove the same. The claim for special damages and breach of contract needed to be proved. He produced no evidence of receipt of payment by the appellant of the sums claimed. He also did not produce any evidence that he had dug a fresh borehole and the only conclusion that can be drawn is that he was using the borehole that was drilled by the appellant.

58. In the end I find that: -1)Special damages must not only be pleaded specifically but strictly proved – in this case the respondent pleaded the special damages but did not prove any of them as not a single document was produced in evidence to support each of the specific claim.2)The respondent did not establish the specifics of the alleged contract he has alleged that the appellant had breached and more importantly did not prove the alleged loss and damage allegedly caused by the alleged breach.3)The appellant’s machinery was unlawfully held by the respondent.4)The appellant did not provide any evidence to support his claim for loss of income as a result of the holding of the machinery by the respondent.

59. So, what are the final orders: -

60. The holding of the appellant’s machinery was uncalled for and was not part of the drilling agreement. The respondent took the law into his own hands in detaining the machinery yet it was not part of the drilling agreement. While the appellant was entitled to damages, this was not proved.

61. The appeal is merited to the extent that the respondent had no lawful reason to hold onto the appellant’s machinery.

62. Ultimately, the judgment of the trial court is set aside.

63. It is substituted with the following orders;i.The respondent is to release promptly to the appellant the appellant’s equipment and machinery as set out herein below in working condition.a)A rock buster 100 drilling rig with a 26 horsepower Kubota engine.b)MCM mud pump with 41 horsepower lister engine.c)37 drill pipe rods and craftsman tool box.d)Matco spanner and wrenches.ii.If for any reason the equipment and machinery are not available or in working condition the respondent to pay the appellant the value of the equipment and machinery at market value.iii.The appellant will have the costs of the suit in the subordinate court and of this appeal and interest at court rates from the date of the Judgment in the subordinate court.

64. Orders Accordingly

DATED, SIGNED AND DELIVERED VIA EMAIL THIS 4TH OF DECEMBER 2023MUMBUA T MATHEKAJUDGECourt Assistant: Kyanga MwiwaJennifer N. Kilonzo & Co. AdvocatesAdvocate for the RespondentEmail: kivuitumaundu@gmail.comOkemwa & Co. AdvocatesAdvocate for the AppellantEmail: okemwa2003@yahoo.com