[2019] KEHC 12290 (KLR)
The court found that the plaintiff's claim of overpayment was premised on inclusion of Kshs. 800,000 paid before the settlement agreement, which should not be counted towards the agreed settlement sum. Excluding this amount, the argument for overpayment is not sustained. The court held that the settlement reached...
Source-derived case information.
- Citation
- [2019] KEHC 12290 (KLR)
- Parties
- Plaintiff: John Nahashon Mwangi (substituted by Lois Nyambura Mwangi); Defendant: Kenya Finance Bank Limited (in liquidation)
- Court
- High Court
- Court Station
- High Court at Nairobi (Milimani Commercial Courts)
- Jurisdiction
- Kenya
- Case Number
- Civil Suit 212 of 2009
- Procedural Posture
- Civil Suit / Ruling on Notice of Motion for Release of Title, Discharge of Charge, and Refund of Alleged Overpayment
- Outcome
- Notice of Motion dated 13th February 2019 dismissed with costs, subject to directions on appointment of accountant and taxation of costs.
- Legal Topics
- Loan Settlement Disputes, Overpayment Claims, Discharge of Charge, Bank Liquidation Procedure
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
More case intelligence is available
Unlock the full research layer for this judgment.
Parties
John Nahashon Mwangi (substituted by Lois Nyambura Mwangi)
Plaintiff
Kenya Finance Bank Limited (in liquidation)
Defendant
Procedural Posture
Civil Suit / Ruling on Notice of Motion for Release of Title, Discharge of Charge, and Refund of Alleged Overpayment
Legal Issues
- 1 Whether the plaintiff has fully settled the loan as per the agreed terms.
- 2 Whether the plaintiff is entitled to a refund for alleged overpayment.
- 3 Whether the defendant should be compelled to release the original title and issue a discharge of charge.
Ratio Decidendi
The court found that the plaintiff's claim of overpayment was premised on inclusion of Kshs. 800,000 paid before the settlement agreement, which should not be counted towards the agreed settlement sum. Excluding this amount, the argument for overpayment is not sustained. The court held that the settlement reached between the parties is binding and must be respected, as there was no application to set it aside. On the issue of costs, the court determined that since there was no consensus on the amount, costs should be taxed by the Taxing Master. The court granted liberty to the parties to appoint an accountant to verify payments made after the settlement agreement, excluding the disputed...
Court Disposition
Notice of Motion dated 13th February 2019 dismissed with costs, subject to directions on appointment of accountant and taxation of costs.
Orders
- Plaintiff and defendant to agree on appointment of an accountant to verify sums paid after the settlement agreement, excluding Kshs. 800,000 paid before 2016, within 21 days.
- If parties disagree on the accountant, the Chairperson of ICPAK to appoint one within 14 days of request.
Full Case Text
Judgment text and source record
39 paragraphs
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA AT NAIROBI
MILIMANI LAW COURTS
COMMERCIAL & ADMIRALTY DIVISION
CIVIL SUIT NO. 212 OF 2009
JOHN NAHASHON MWANGI.....................................................PLAINTIFF
VERSUS
KENYA FINANCE BANK LIMITED (in liquidation)............DEFENDANT
RULING
1. These proceedings are now at the tail end but there is a disagreement as to whether the debt that is the subject matter has been fully paid. The Plaintiff takes the view that she has in fact made an overpayment, and has through a Notice of Motion dated 13th February 2019 sought the following prayers;-
1. Spent
2. THAT the Honourable Court be pleased to order the Defendant to forthwith release the original title thereof being Title Number I.R 5311/1 and issue a Discharge of Charge in respect of Land Reference Number L.R No.2246/5 Langata.
3. THAT the Honourable Court be pleased to order the Defendant to refund overpayment in the sum of Kshs.928,974.
4. THAT upon release of the Plaintiff’s Title and Discharge of charge this matter be marked as fully settled with no orders as to costs.
5. THAT the Honourable Court be pleased to grant any other order it deems fit and appropriate in the circumstances.
2. A short background can be sketched from the rival affidavits filed herein. John Nahashon Mwangi (now deceased) was a customer of the Defendant Bank. He fell into arrears of a loan granted to him by the Bank. His widow and administratrix to his estate, Lois Nyambura Mwangi, is now the Plaintiff in his place. Her contention is that after the parties herein reworked the debt it was agreed that it be fully settled at Kshs. 6,351,327. 52. Her case is that she has not only discharged her obligation but has overpaid. The Plaintiff sets out the payments made as follows;-
Date Amount (Kshs.)
a) Loan repayments before 2016 800,000/=
b) 6th March 2017 480,301/=
c) 8th December 2016 2,000,000
d) 7th September 2018 4,000,000
Total amount repaid 7,280,301
3. The Bank’s position is that while there were discussions about a possible settlement at that sum (ie. 6,351,327. 32), the Plaintiff having made a proposal, it was subject to all costs being paid by the Plaintiff. In this regard, the Bank states that it advised the Plaintiff that the costs payable was Kshs. 1,362,460. 00 but the Plaintiff made a proposal to pay Kshs.500,000. 00, an offer that was rejected.
4. On the alleged overpayment the Bank asserts that the Plaintiff has included a sum of Kshs. 800,000. 00 which was paid prior to it going into liquidation and which was not part of the settlement.
5. It does seem to this Court that this is a rather straightforward matter that parties would have resolved. First, on the alleged repayment, the Bank’s contention that Kshs. 800,000. 00 was outside the agreed settlement of Kshs. 6,351,327. 32 has not been rebutted. If that amount is excluded, as it should, then the argument of an overpayment could crumble. If however the Plaintiff insists that there is an overpayment even after excluding this amount, then this Court shall grant her the liberty to rework out the accounts on terms that it will set.
6. On the issue of costs, the Bank has produced a letter of 8th October 2018 in which the Bank rejects an offer by the Plaintiff to pay costs at Kshs. 500,000. 00. That there was such an offer is, again, not rebutted by the Plaintiff .The offer was made after the settlement was negotiated and would therefore be an acknowledgment that the settlement did not include costs. Yet because there is no consensus as to the amount, the costs shall be subjected to taxation.
7. I know the Plaintiff feels aggrieved she has had to pay substantially more than the loan amount of Kshs. 1,450,000. 00 but the settlement reached by the parties was not forced on them. At any rate the Court has not been asked to set it aside. It must be taken to be the bargain of the parties. A bargain which must be respected and given effect by the Court.
8. This is my answer to the Notice of Motion of 13th February 2019.
8. 1 The Plaintiff is hereby granted liberty to agree with the Bank on the appointment of an accountant to work out all sums paid after the agreement of Kshs. 6,351,327. 32. The repaid sum shall not include Kshs. 800,000. 00 paid before 2016. Such appointment to be made within 21 days hereof. In the event of a disagreement as to the accountant, the Chairperson of the Institute of Certified Public Accountants of Kenya to make the appointment within 14 days of request by either party.
8. 2 The accountant’s fee shall be met in the first instance by the Plaintiff. However, if the accounts reveal on overpayment then the fees shall be paid back to the Plaintiff by the Bank.
8. 3 Costs shall be taxed by the Taxing Master of this Court.
8. 4 Otherwise the Notice of Motion dated 13th February 2019 is hereby dismissed with costs.
Dated, delivered and signed in open Court at Nairobi this 31st Day of May, 2019.
F. TUIYOTT
JUDGE
Present:-
Mirei h/b for Kingara for Plaintiff
N/a for Defendant
Fred – Court Assistant