https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/12476

**REPUBLIC OF KENYA** **IN THE HIGH COURT OF KENYA AT THIKA** **CIVIL APPEAL NO. E182 OF 2024** **PATRICK NDICHU GITAU……………………………..…….…1ST APPELLANT** **PATRICK NDICHU GITAU & SONS LTD…………..………….….2ND APPELLANT** **VERSUS** **KENYA COMMERCIAL BANK LIMITED ………………….…….1ST RESPONDENT** **PURPLE ROYAL AUCTIONEERS…………………….………….2ND RESPONDENT** **(*Being an appeal from the ruling and order of the Honourable Daniel Ngalu delivered at the Chief Magistrates Court at Gatundu on the 26th June 2024*)** **J U D G M E N T** **Introduction** 1. This appeal arises from the ruling of *Hon Daniel Ngalu CM* delivered on 26th June 2024 at Gatundu Law Courts. 2. The appellants instituted the claim leading to this appeal vide a plaint dated 26th February 2020. The appellants claimed that they were the registered owners of Ng’enda/ Githunguchi/1426 and 1427. In 2010, the 2nd appellant obtained a bank overdraft of Kenya Shillings Six Million (Kshs.6,000,000) from the 1st respondent by charging titles 1426 and 1427 mentioned above. The 1st respondent subsequently instructed the 2nd respondent to realize the security through the statutory power of sale. The appellants claimed that the purported statutory power of sale was illegal and unlawful on the following grounds: failure to issue a statutory notice, failure to serve a notification of sale upon the 1st appellant, fraudulently initiating the sale of the properties, failure to allow the 1st appellant to exercise his right of redemption and levying un-contractual and illegal charges on the appellants’ statement of accounts. The appellants sought declaratory orders and an order of permanent injunction against the respondents. 3. The respondents filed a statement of defence dated 31st August 2020. The respondents denied the claim and urged the court to strike out the plaint and dismiss the suit with costs. 4. PATRICK NDICHU GITARI PW-1 testified on oath and adopted his witness statement dated 27.02.2020 as his evidence in chief and produced Exhibits before the court. He stated that he pledged parcel 1426 and 1427 and LR Number 21096/95, namely Juja Skyline House as security for the advanced loan. 5. He stated that he learnt that his properties had been sold through an advertisement in the Daily Nation newspaper. He stated that he visited the bank requesting details of the loan and that the bank has never furnished him with the statements. He stated that he had paid the loan. He stated that Juja Skyline House was valued at more than the loan amount. 6. Upon cross-examination, he stated that he had filed a suit at Kiambu High Court in relation to LR 21096/95. He stated that he was served with the notification of sale. He stated that there was an overcharge for a period of two years on the statements after examination by a certified accountant. 7. WINFRED ABINCHO PW-2 testified on oath and stated that she is an accountant working with Interest Rates Advisory Centre. She stated that the plaintiffs held two loan accounts with KCB. She stated that there was a bank overcharge of Kshs.1,501,337. She stated that there was a discrepancy between the bank interest and the interest calculated. She stated that the bank did not debit the 1st months interest. She stated that the bank interest charged in the 4th and 6th months was higher than it ought to have been. She produced the report indicating that the overall overcharge from the two accounts was Kshs.4,707,502.62/=. 8. Upon cross-examination, she stated that overcharges in a loan lead to account arrears. She stated that the bank was charging interest at more than 4% over the CBK Rate. She stated that she worked with the maximum rate chargeable. 9. VERONICAH WAIRIMU NDICHU PW-3 testified on oath and stated that they sought the opinion of the Interest Rates Advisory Centre after the plaintiffs noted a discrepancy in the interest amounts. She stated that the total overcharge was Kshs.4.7 million. 10. Upon cross-examination, she stated that the bank undervalued their property. She stated that she was not given a statutory notice. She stated that she was willing to pay the debt. 11. BERNARD KIMINJA THUO DW-1 testified on oath and stated that he was the KCB Manager, Gatundu Branch. He adopted his statement as his evidence in chief. He stated that the bank applied a 14% interest rate. He stated that there was an additional default penalty of 30% charged on the overdue portion as penalty. 12. Upon cross-examination, he stated that the 1st plaintiff had guaranteed 6 million. He stated that the default interest rate was 17%. 13. The plaintiffs filed submissions and submitted that there was a difference in value between the 1st and 2nd valuations. The plaintiffs submitted that the defendants failed to adduce evidence to rebut the evidence presented on interest computations. Moreover, the plaintiffs submitted that the bank levied uncontractual charges. 14. The defendants submitted that the issue of valuation should not hinder the bank from exercising its statutory power of sale. In addition, the bank submitted that it did not vary the interest and urged the court to dismiss the plaintiffs’ claim with costs. 15. Upon considering the evidence presented, the trial magistrate, *H.M Ng’ang’a (PM),* entered judgment dated 4th May 2022 in favour of the plaintiffs in the following terms: 16. *A declaration that the sale of Ngenda/ Githunguchu/ 1426 and 1427 was illegal, null and void ab initio.* 17. *An order directing the defendants to provide bank statements from July 2007 to date to the plaintiffs.* 18. *An order directing the defendants to issue a fresh statutory notice to the plaintiffs was issued.* 19. *An order that any fresh private auction be guided by the ADD* *Property Consultants valuation report dated 10th October 2022.* 20. *Costs of the suit and interest at court rate.* 21. Afterwards, the plaintiffs filed a notice of motion application under a certificate of urgency dated 19th August 2023. The plaintiffs sought an order of injunction restraining the defendants from advertising and selling the 1st plaintiff’s property, *Ngenda/ Githunguchu/1426 & 1427*, pending compliance with the order requiring the defendants to issue the plaintiffs with the bank loan statements as per the judgment dated 4th May 2022. The application was premised on the ground that the defendants had failed to supply the plaintiffs with the bank statements and that the plaintiffs were apprehensive that their property would be sold. 22. In response to the notice of motion of application, the defendants filed a replying affidavit dated 5th October 2023. The defendants urged the court to dismiss the notice of motion application for want of jurisdiction. The defendants averred that the credit advanced by the bank was presently at Kshs.95,606,499.70/= beyond the pecuniary jurisdiction of the magistrate’s court. 23. The court directed that the application be canvassed by way of written submissions. The plaintiffs filed written submissions dated 23rd November 2023. The plaintiffs submitted that the defendants had only shared bank loan statements from 2009 contrary to what the court had ordered. The plaintiffs submitted that the defendants could only issue a fresh statutory notice after complying with the orders issued by the court. 24. As regards jurisdiction, the plaintiffs submitted that present application only sought to enforce the orders of the court issued on 4th May 2022. The plaintiffs submitted that the court had jurisdiction to compel the defendants to abide by the court orders. The plaintiffs urged the court to allow the notice of motion application as prayed. 25. The respondents filed written submissions dated 27th February 2024. The respondents submitted that the court lacks pecuniary jurisdiction to hear and determine the application before it. The respondents submitted that the subject matter loan was presently at Kshs 96,606,499.70/=. The respondents submitted that the pecuniary value was beyond the magistrate's court jurisdiction. The respondents submitted that they had complied with the orders of the court issued in the judgment dated 4th May 2022. The respondents submitted that the court cannot issue injunctive reliefs in a post judgment application and at a time when it is *functus officio*. The respondents urged the court to dismiss the application. 26. The court, vide a ruling dated 26th June 2024, *Hon D Musyoka (CM*) held that the court did not have jurisdiction and struck out the notice of motion application dated 19th August 2023 and the whole suit. **THE APPEAL** 1. The applicants, being dissatisfied with the ruling of the court dated 26th June 2024, filed the present appeal vide a memorandum of appeal seeking the following reliefs: 2. *That the ruling delivered on 26th June 2024 in the Chief Magistrate’s Court in Civil Case Number 67 of 2020 be set aside.* 3. *That the judgment delivered on 4th May 2022 in Civil Case Number 67 of 2020 be declared valid and enforceable.* 4. *That the cost of the appeal be awarded to the appellant.* 5. The grounds of appeal outlined in the Memorandum of Appeal are: 6. *That the magistrate erred by failing to appreciate that the court became functus officio and the only remedy available to the 1st respondent was appeal.* 7. *That the magistrate erred by striking out the appellant’s suit yet no application for striking out had been filed.* 8. *That the Magistrate erred by failing to appreciate that the respondents admitted the jurisdiction of the court in their defence.* 9. *That the magistrate erred by holding that the court did not have jurisdiction yet the pecuniary value of the subject matter legal charge was Kshs.6,000,000/=.* 10. The appeal proceeded by way of written submissions. The appellants filed written submissions dated 24th February 2026. The appellants submitted that the trial court became *functus officio* on 4th May 2022 and that it only retained residual jurisdiction to entertain enforcement applications. The appellants submitted that once judgment is delivered, the trial court does not have authority to undo its adjudication. The appellants submitted that the power to strike out or set aside the judgment is a power reserved for the appellate court. 11. The appellant submitted that the trial court lacked jurisdiction to re-determine the question of jurisdiction and strike out the suit which it had presided over and pronounced itself. The appellants submitted that the court’s application of the ***Lillian S*** decision in the present circumstances was a stretch beyond its logical and doctrinal limits. 12. The appellants submitted that the jurisdictional issue was conclusively determined on 23rd November 2020 and that the said decision was never appealed. The appellant urged the court to allow the appeal as prayed. 13. The respondents filed submissions dated 15th May 2026. The respondents submitted that the trial court never determined the question of jurisdiction on 23rd November 2020. The respondents submitted that the court lacked jurisdiction to hear and determine the notice of motion application. 14. As regards the doctrine of *functus officio,* the respondents cited the case of ***Telkom Kenya Limited vs John Ochanda 2014 eKLR*** and invited the court to be guided by the said decision. 15. The respondents submitted that the appellants ought not to place the burden of justifying the error of filing the suit in the wrong court on the respondents. The respondents submitted that the trial court judiciously exercised its discretion by finding that it did not have jurisdiction and dismissed the suit. **ANALYSIS AND DETERMINATION** 1. This court has considered the entire record of appeal and the parties’ submissions as well as the decisions referred to. 2. This being a first appeal, the High Court is under a duty to reconsider and re-evaluate the evidence and draw its own conclusions. The court must take great exception with respect to the fact that it has neither seen nor heard the witnesses. 3. The role of a first appellate court was reiterated in the matter of ***Selle vs Associated Motor Boat Company (1968) EA***. The court held that the first appellate court is enjoined to revisit the evidence that was before the trial court afresh, analyze it and arrive at its own independent findings, but always bearing in mind that the trial court had the benefit of seeing the witnesses, hearing them and observing their demeanor. 4. Moreover, in the case of ***Gitobu Imanyara v Attorney General (2016) eKLR*,** the court set out the principles guiding a first appellate court as follows:- ‘*An appeal to this court by way of retrial and the principles upon which this court acts in such an appeal are well settled. The court must reconsider the evidence, evaluate itself and draw its own conclusion though it should always bear in mind that it has never seen nor heard the witnesses and should make due allowance in this respect’.* 1. The court in the above-mentioned cases reiterated that the first appellate court is not bound to the trial court’s findings of fact if it appears that the tribunal has clearly failed on some account of particular circumstances or probabilities materially to estimate the evidence. 2. The court has considered the pleadings together with the submissions filed, and the issue that arises for determination is: i) *Whether the trial court had jurisdiction to hear the notice of motion application dated 19th August 2023 and whether it had jurisdiction to issue the orders it issued on 20th June 2024?* *ii) Who bears the cost of the appeal?* 1. The law on jurisdiction was enunciated in the matter of **Owners of Motor Vessel Limited ‘Lillian S’ vs Caltex Oil Kenya Limited**. The court held that jurisdiction is everything and without it a court has no power to make a further step. 2. Jurisdiction is the cornerstone to judicial authority and it flows from the Constitution or a Statute. In the case of ***Macharia vs Kenya Commercial Bank eKLR***the court held that jurisdiction of a court flows either from the Constitution or a Statute. 3. The notice of motion application dated 19th August 2023 sought an order of injunction to restrain the respondents from proceeding with their statutory sale before complying with the orders issued on 4th May 2022, specifically the order compelling the respondents to supply bank statements from 2007 to date to the plaintiffs. 4. The applicant/ appellants urged the court to issue an order to compel the respondents to comply with the orders of the court. 5. In their response, the respondents submitted that the court lacked jurisdiction to hear the present application. 6. At this juncture, the court is called upon to determine whether the trial court had jurisdiction to hear a post judgment application on enforcement. The court had issued a judgment on 4th May 2022. As such, the court had assumed jurisdiction in the matter and heard the parties conclusively, culminating in its judgment dated 4th May 2022. The subject legal charge in dispute dated 9th July 2007, leading to the primary suit, was Kshs 6,000,000/=. The court heard both parties and rendered a judgment dated 4th May 2022. 7. The pecuniary jurisdiction of the Magistrates' Court is outlined in Section 7 of the Magistrates ' Court Act 2015. The magistrate court has jurisdiction to hear and determine civil disputes up to a pecuniary limit of Kenya Shillings Twenty Million (Kshs. 20,000,000). 8. As such, I find that the trial court had jurisdiction to hear and determine the legal issues arising from the disputed charge and the manner in which the respondents were exercising their statutory power of sale. 9. In light of the foregoing, I find that the judgment dated 4th May 2022 was sound legally and factually. 10. The notice of motion application filed by the appellants sought orders to restrain the respondents from exercising their statutory power of sale without complying the orders issued in the judgment dated 4th May 2022. 11. The court has jurisdiction to hear post judgment applications. As such, the orders sought related to the charge of Kshs.6,000,000/=, in which a judgment had been issued and not the accrued loan of Kshs.96,606,499.70/=. 12. In light of the foregoing, I find that the court had jurisdiction to hear and determine the notice of motion on merit and establish whether the respondents had complied with the court order issued on 4th May 2022 or not. 13. Moreover, the magistrate’s court cannot sit on its own decision and set aside orders it had initially issued. The court can only review its orders within the parameters outlined under **Order 40 of the Civil Procedures Rules.** 14. A Chief Magistrate cannot sit as an appellate court in a decision issued by their sister Principal Magistrate. The issue of jurisdiction post judgment could only be determined by the High Court. As such, I find that the trial magistrate erred in law and in fact by striking out the suit and the orders issued on 4th May 2022 in a post judgment enforcement application. 15. In conclusion, I find that the appeal has merit and enter judgment in favour of the appellants in the following terms: 1. *The appeal is hereby allowed.* 2. *The ruling issued by Hon Daniel Ngalu (CM) in Civil Case Number 67 of 2020 on 26th June 2024 is hereby set aside.* 3. *The judgment issued on 4th May 2022 in Civil Case Number 67 of 2020 is valid and enforceable legally.* 4. *An order is hereby issued directing the Magistrates' Court at Gatundu to hear and determine the notice of motion application dated 19th August 2023 on a priority basis. For the avoidance of doubt, the said application shall be heard and determined by a Judicial Officer other than Hon. D. N. Ngalu.* 5. *The appellants are awarded the costs of the appeal.* ***Dated, Delivered and Signed*** *at* ***Nairobi this 23rd day of July 2026.*** **DAVID MBURU** **JUDGE** **In the presence of:** *Mr. Masinde for the Appellant* *Mr. Swaka for the Respondents* *Kalondu - Court Assistant*