https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/12201

**REPUBLIC OF KENYA** **IN THE HIGH COURT OF KENYA AT MERU** **CIVIL APPEAL NO. E392 OF 2024** **MARY STELLA KANANU…………………………………. APPELLANT** **-VERSUS-** **CATHERINE MWARI GAITI MUTWIRI…………………. RESPONDENT** **(Being an Appeal against the Judgement and Decree of the Senior Principal Magistrate Court by Hon S. K. Ngetich (SPM) at Nkubu in ELC No. 47 of 2020 delivered on 4th December, 2024)** **JUDGEMENT** 1. This appeal arises from the Judgment and Decree of the Senior Principal Magistrate's Court at Nkubu, delivered by Hon. S. K. Ngetich (SPM) in ELC Case No. 47 of 2020 on 4th December 2024. The genesis of the dispute stems from a land sale transaction entered into on or about 28th March 2006 between the Respondent, Catherine Mwari Gaiti Mutwiri (the Plaintiff in the trial court), and the Appellant, Mary Stella Kananu (the Defendant in the trial court), in respect of Land Parcel No. NKUENE/TAITA/948. The Respondent averred that, pursuant to a sale agreement of the same date, she agreed to purchase the suit property from the Appellant for a consideration of Kshs. 200,000/=, which she fully paid by way of a deposit of Kshs. 50,000/= and subsequent instalments, all of which were duly acknowledged by the Appellant. 2. In the Plaint dated 13th August 2020, the Respondent further pleaded that despite receiving the full purchase price, the Appellant failed and/or refused to transfer the suit property as agreed, thereby breaching the sale agreement. The Respondent averred that following persistent demands for performance of the contract, the parties executed a subsequent agreement dated 5th May 2014, under which the Appellant undertook to refund the purchase price together with agreed damages amounting to Kshs. 400,000/=. The Respondent further contended that although the Appellant paid Kshs. 194,000/= in partial fulfilment of that undertaking and covenanted to settle the outstanding balance of Kshs. 206,000/= by 31st December 2015, she failed to do so, thereby rendering herself liable for the agreed damages and interest of Kshs. 400,000/=. 3. It was the Respondent's case that at the time of instituting the suit, the Appellant had neither transferred the suit property nor paid the outstanding balance and agreed damages, thereby remaining in breach of both agreements. The Respondent particularised the breach as the Appellant's failure to transfer the land, refusal to honour the agreement dated 5th May 2014, failure to pay the outstanding sum of Kshs. 606,000/=, and persistent refusal to honour the parties' contractual obligations despite numerous demand notices. Consequently, the Respondent sought judgment against the Appellant for payment of Kshs. 606,000/= together with interest thereon, costs of the suit, and interest on the costs. 4. The Appellant robustly defended the suit through a Statement of Defence dated 2nd March 2021, wherein she denied the Respondent’s claim in its entirety and put her to strict proof thereof. The Appellant contended that the suit was statute-barred, bad in law, frivolous and vexatious, and averred that the purchase price had long been refunded, thereby bringing the dispute to a close. She further maintained that the alleged contract was unenforceable by reason of limitation and consequently prayed for the dismissal of the suit with costs. 5. Upon evaluating the pleadings, the evidence adduced, and the submissions filed by the parties, the learned Senior Principal Magistrate found that the Respondent's suit had been instituted within the limitation period prescribed under Section 4(1) of the Limitation of Actions Act. The trial court reasoned that although the original sale agreement was executed on 28th March 2006, the cause of action arose from the Appellant's breach of the subsequent agreement dated 20th April 2015, under which she undertook to pay the outstanding balance of Kshs. 206,000/= by 31st December 2015, failing which she would become liable to pay an additional Kshs. 400,000/= as agreed interest and damages. Consequently, the court held that the suit, having been filed on 18th August 2020, was not statute-barred. 6. During the trial, the Respondent testified as PW1 and adopted her witness statement dated 13th August 2020 as her evidence-in-chief. She also produced the documents contained in her List of Documents dated 7th August 2023 as exhibits. During cross-examination, she maintained that the Appellant had failed to transfer the suit property despite receiving the full purchase price and confirmed that the parties had subsequently executed agreements dated 5th May 2014 and 20th April 2015 providing for the refund of the purchase price and agreed damages. Upon re-examination, she reiterated that the Appellant had failed to honour the subsequent agreements despite undertaking to refund the money. 7. The Appellant testified as DW1 and adopted her witness statement dated 2nd March 2021 as her evidence-in-chief. She admitted receiving the full purchase price of Kshs. 200,000/= but maintained that the Respondent had declined to take possession of the land, prompting her to refund Kshs. 194,000/= while expressing willingness to pay the outstanding balance of Kshs. 6,000/=. During cross-examination, the Appellant acknowledged that the agreements dated 5th May 2014 and 20th April 2015 bore her signature but stated that she could not recall making the undertakings contained therein. 8. The learned trial magistrate proceeded to hold as follows: "I, therefore, find that the defendant breached the agreement by failing to pay Ksh.206,000/= by 31/12/2015 and is therefore liable to pay the said sum together with the agreed interest of Ksh.400,000/=, making a total of Ksh.606,000/=. I therefore enter judgment for the plaintiff against the defendant for the sum of Ksh.606,000/= together with interest at court rates from the date of filing this suit. The plaintiff is also awarded the costs of the suit." 1. Aggrieved by the Judgment and Decree of the learned Senior Principal Magistrate delivered on 4th December 2024, the Appellant lodged the present appeal. 2. The Appellant's case on appeal is anchored on five principal grounds set out in her Memorandum of Appeal. The Appellant contends that the learned trial magistrate erred both in law and fact by relying on agreements whose authenticity she had disputed, awarding the Respondent Kshs. 606,000/= despite the admitted refund of Kshs. 194,000/=, failing to appreciate that the impugned award amounted to unjust enrichment, inadequately evaluating the evidence and submissions tendered by the Appellant, and ultimately arriving at a decision that was contrary to the law, the evidence on record, and the applicable legal principles. Accordingly, the Appellant urges this Court to allow the appeal, set aside and/or vary the judgment of the trial court, re-evaluate the evidence afresh, and award her the costs of both the appeal and the proceedings before the trial court. **Issues for Determination** 1. The Court directed the parties to file written submissions in support of their respective positions. However, none of the parties filed submissions. Accordingly, this appeal falls for determination on the basis of the Record of Appeal, the grounds of appeal, and the applicable law. Accordingly, I frame the following issues for determination as arising from the Memorandum of Appeal: 1. Whether the learned trial magistrate erred in law and fact by relying on the agreements dated 5th May 2014 and 20th April 2015 notwithstanding the Appellant’s challenge to their authenticity and veracity. 2. Whether the learned trial magistrate properly evaluated the pleadings, the evidence adduced, and the applicable law before entering judgment in favour of the Respondent. 3. Whether the award of Kshs. 606,000/= in favour of the Respondent was legally and factually justified or amounted to unjust enrichment. **Analysis and determination** 1. This being a first appeal, this Court is under a duty to reconsider, re-evaluate and re-analyse the evidence on record and draw its own independent conclusions, while bearing in mind that it neither saw nor heard the witnesses testify and must therefore give due allowance for that fact. In ***Mbogo & Another v Shah [1968] EA 93***, the Court held that: "...this Court will not interfere with the exercise of judicial discretion by an inferior court unless it is satisfied that its decision is clearly wrong, because it has misdirected itself or because it has acted on matters on which it should not have acted or because it failed to take into consideration matters which it should have taken into consideration and in doing so arrived at a wrong conclusion." 1. Similarly, in ***Peters v Sunday Post Ltd [1958] EA 424,*** the Court observed: "It is a strong thing for an appellate court to differ from the findings on a question of fact, of the judge who had the advantage of seeing and hearing the witnesses… But the jurisdiction to review the evidence should be exercised with caution; it is not enough that the appellate court might have come to a different conclusion." 1. The burden of proving any fact rests upon the party who alleges it. This principle is embodied in Sections 107, 108 and 109 of the Evidence Act, Cap 80 Laws of Kenya. It was further reiterated in ***Evans Nyakwana v Cleophas Bwana Ongaro [2015] eKLR*** that both the legal and evidential burden rest upon the party asserting a particular fact. 2. I now turn to the first issue of determination namely, **Whether the learned trial magistrate erred in law and fact by relying on the agreements dated 5th May 2014 and 20th April 2015 notwithstanding the Appellant’s challenge to their authenticity and veracity.** 3. The record shows that the Respondent pleaded that she entered into a sale agreement with the Appellant on 28th March 2006 for the purchase of Land Parcel No. NKUENE/TAITA/948 at a purchase price of Kshs. 200,000/=, which she paid in full through various instalments acknowledged by the Appellant. She further pleaded that after the Appellant failed to transfer the suit property, the parties entered into a subsequent agreement dated 5th May 2014, under which the Appellant undertook to refund Kshs. 400,000/=, being the purchase price together with the agreed damages. The Respondent further pleaded that the Appellant subsequently paid Kshs. 194,000/=, leaving an outstanding balance of Kshs. 206,000/=. She further pleaded that on 20th April 2015, the parties entered into a further agreement before the area Chief, wherein the Appellant undertook to settle the outstanding amount, failing which the agreed consequences would apply. 4. During her testimony, the Respondent adopted her witness statement and produced the documents in support of her case. In cross-examination, she maintained that although the Appellant had sold the suit property to her, the Appellant failed to transfer the same. She stated that the parties subsequently entered into further agreements to resolve the dispute, that the Appellant refunded Kshs. 194,000/=, and that the subsequent agreements were not honoured. During re-examination, she reiterated that the agreement dated 5th May 2014 related to the refund of the purchase price and that the agreement entered into before the area Chief on 20th April 2015 was likewise not honoured by the Appellant. 5. On her part, the Appellant admitted that she sold the suit property to the Respondent and received the full purchase price of Kshs. 200,000/=. She equally admitted refunding Kshs. 194,000/= and maintained that only Kshs. 6,000/= remained outstanding. During cross-examination, when shown the agreement dated 5th May 2014, she expressly admitted that the signature appearing thereon was hers and acknowledged that the agreement reflected a debt of Kshs. 400,000/=. Although she stated that she could not recall making such an undertaking, she did not deny signing the agreement. Likewise, when shown the agreement dated 20th April 2015, she stated that she could not recall the agreement but admitted that the parties had indeed entered into an agreement before the area Chief in 2015. While she denied agreeing to pay damages, she did not dispute that the agreements bore her signature. 6. The documentary evidence produced before the trial court substantially corroborated the Respondent's testimony. The record contains the sale agreement dated 28th March 2006, acknowledgements executed by the Appellant confirming receipt of the purchase price, the agreements dated 5th May 2014 and 20th April 2015, correspondence from the District Land Registrar relating to the suit property, and several demand letters issued by the Respondent's advocates calling upon the Appellant to honour her contractual obligations. All these documents were produced as exhibits without objection and formed part of the evidentiary record before the trial court. 7. From my independent evaluation of the evidence, I find that although the Appellant questioned the contents and legal effect of the agreements, she neither pleaded nor proved that they were forged, fraudulently procured, executed under duress, induced by misrepresentation, undue influence or mistake. She did not call any witness, produce expert evidence or tender any material capable of impeaching either the authenticity of the signatures or the validity of the agreements. Her challenge remained no more than a bare assertion that she could not recall making the undertakings contained therein. 8. The Appellant's admission that the signatures appearing on the agreements were indeed hers is particularly significant. In the absence of any evidence of fraud, misrepresentation or any other vitiating factor, the law presumes that a person who signs a contractual document intends to be bound by its terms. This principle was succinctly stated by Scrutton LJ in ***L'Estrange v F Graucob Ltd [1934] 2 KB 394 at 403***, where he held: "When a document containing contractual terms is signed, then, in the absence of fraud, or, I will add, misrepresentation, the party signing it is bound, and it is wholly immaterial whether he has read the document or not." 1. That principle applies with equal force in the present appeal. Having admitted that the agreements bore her signature, the Appellant could not avoid their legal effect merely by asserting that she could not recall making the undertakings contained therein. Such an assertion, without more, was insufficient to invalidate the agreements or diminish their evidential value. 2. In my considered view, the Appellant failed to discharge the evidential burden imposed upon her by Sections 107, 108 and 109 of the Evidence Act. Once the Respondent produced the agreements and testified as to the circumstances under which they were executed, and the Appellant admitted executing them, the evidential burden shifted to the Appellant to establish a factual basis upon which those agreements could be impeached. She failed to do so. 3. Accordingly, I find no basis upon which this Court can fault the learned trial magistrate for relying on the agreements dated 5th May 2014 and 20th April 2015. The agreements were properly admitted into evidence, their execution was substantially admitted by the Appellant, and no credible evidence was adduced to impeach their authenticity or validity. 4. I therefore find that the learned trial magistrate properly relied on the said agreements in determining the respective rights and obligations of the parties. Consequently, the Appellant's challenge to the authenticity and veracity of the agreements is without merit, and the first ground of appeal accordingly fails. 5. Moving to issue two namely, **Whether the learned trial magistrate properly evaluated the pleadings, the evidence adduced, and the applicable law before entering judgment in favour of the Respondent.** 6. It is trite law that parties are bound by their pleadings and that a court can only determine a dispute on the basis of the pleadings, the evidence adduced and the applicable law. In ***Fernandes v People Newspapers Ltd [1972] EA 63, Law Ag. V-P*** stated: "A civil case is decided on issues arising out of the pleadings. No allegation of negligence against the appellant has ever been made, and it was not open to the court to find negligence on his part." 1. Having carefully reconsidered the entire record of appeal, I am satisfied that the learned trial magistrate correctly identified the issues falling for determination, namely, whether the suit was statute-barred and whether the Appellant had breached the agreements entered into between the parties. 2. On the issue of limitation, the learned trial magistrate correctly found that although the original sale agreement was executed on 28th March 2006, the Respondent's claim was not founded solely on that agreement. Rather, it was founded on the subsequent agreements dated 5th May 2014 and 20th April 2015, which the parties executed in an effort to resolve the dispute arising from the failed land transaction. Under the agreement dated 20th April 2015, the Appellant undertook to settle the outstanding balance by 31st December 2015. It was upon her failure to honour that undertaking that the cause of action accrued. Consequently, the learned trial magistrate properly computed the limitation period from the date of the alleged breach and correctly concluded that the suit, having been filed on 18th August 2020, was instituted within the six-year limitation period prescribed under Section 4(1) of the Limitation of Actions Act. 3. On the merits of the claim, the pleadings, the oral testimony and the documentary evidence consistently established that the Respondent paid the agreed purchase price of Kshs. 200,000/=, the Appellant failed to transfer the suit property, and the parties subsequently entered into the agreements dated 5th May 2014 and 20th April 2015 in an attempt to resolve the dispute. The documentary evidence, comprising the sale agreement, acknowledgements of payment, the subsequent agreements, correspondence from the District Land Registrar and demand letters, substantially corroborated the Respondent's case. Those documents were produced as exhibits without objection and formed part of the evidentiary record before the trial court. 4. During her testimony, the Appellant admitted receiving the full purchase price of Kshs. 200,000/= and further admitted refunding Kshs. 194,000/=. More significantly, during cross-examination, she acknowledged that the agreement dated 5th May 2014 bore her signature and further admitted that the parties subsequently entered into another agreement in 2015. Although she stated that she could not recall making the undertakings contained in those agreements, she neither denied executing them nor adduced any evidence to demonstrate that they had been procured through fraud, coercion, misrepresentation, undue influence or any other vitiating factor. 5. . In those circumstances, the learned trial magistrate was entitled to rely on the agreements in determining the respective rights and obligations of the parties. The Appellant's contention that only Kshs. 6,000/= remained outstanding was inconsistent with the subsequent written agreements voluntarily executed by her. 6. Upon my own independent evaluation of the pleadings, the evidence on record and the applicable law, I find no misdirection on the part of the learned trial magistrate in relation to his findings on limitation and liability. Those findings were firmly grounded on the pleadings, the evidence and the applicable legal principles. I am therefore satisfied that the learned trial magistrate properly evaluated the pleadings, the evidence adduced and the applicable law in determining that the Appellant was in breach of the parties' agreements. Accordingly, this ground of appeal is devoid of merit and is hereby dismissed. 7. I now turn to the third issue for determination, namely, **whether the learned trial magistrate was justified in awarding the Respondent Kshs. 606,000/=, or whether that award was erroneous in law and fact and amounted to unjust enrichment.** 8. The record shows that the Respondent's claim before the trial court comprised a sum of Kshs. 606,000/=, made up of Kshs. 206,000/= being the outstanding balance allegedly due under the agreement dated 20th April 2015, and a further Kshs. 400,000/= claimed as agreed damages and interest in the event of default. Upon finding that the Appellant had breached the agreement by failing to pay the outstanding balance by 31st December 2015, the learned trial magistrate entered judgment in favour of the Respondent for the entire sum claimed. 9. Upon undertaking my own independent re-evaluation of the pleadings, the documentary evidence, the oral testimony and the applicable law, I am satisfied that the Respondent proved her entitlement to the outstanding balance of Kshs. 206,000/=. The evidence on record establishes that the Appellant received the full purchase price of Kshs. 200,000/= pursuant to the sale agreement dated 28th March 2006 and subsequently refunded Kshs. 194,000/=. Thereafter, by the agreement dated 20th April 2015, the Appellant expressly acknowledged that the outstanding balance stood at Kshs. 206,000/= and unequivocally undertook to settle the same on or before 31st December 2015. 10. That conclusion is further reinforced by the Appellant's own testimony. She admitted receiving the full purchase price, refunding Kshs. 194,000/=, and acknowledged that the agreement dated 5th May 2014 bore her signature. She further admitted that the parties subsequently entered into another agreement before the area Chief in 2015. Although she claimed that she could not recall making the undertakings contained in those agreements, she neither denied executing them nor adduced any evidence to show that they were procured through fraud, coercion, undue influence, misrepresentation or any other vitiating factor. In those circumstances, the learned trial magistrate was entitled to rely on the agreements in determining the parties' respective rights and obligations. I therefore find that the award of Kshs. 206,000/= was fully supported by the pleadings, the evidence and the applicable law. 11. The more difficult question, however, concerns the additional award of Kshs. 400,000/=. The agreement dated 20th April 2015 provided that should the Appellant fail to pay the outstanding balance by 31st December 2015, she would become liable to pay a further sum of Kshs. 400,000/= described as damages and interest. Although parties are generally bound by the terms of contracts voluntarily entered into, it remains the duty of the court to determine whether the particular contractual provision relied upon is legally enforceable and whether the remedy sought accords with the applicable principles of contract law. 12. It is trite law that a court cannot rewrite a contract voluntarily entered into by the parties. In ***National Bank of Kenya Limited v Pipeplastic Samkolit (K) Ltd [2002] eKLR***, the Court of Appeal stated: "A court of law cannot rewrite a contract between the parties. The parties are bound by the terms of their contract, unless coercion, fraud or undue influence are pleaded or proved.” 1. However, the principle that courts do not rewrite contracts does not absolve a court of its duty to determine whether the contractual remedy sought is one recognised and enforceable in law. A careful reading of the impugned judgment reveals that the learned trial magistrate awarded the additional sum of Kshs. 400,000/= solely on the basis that it had been stipulated in the agreement between the parties. The learned trial magistrate did not consider whether that sum constituted enforceable liquidated damages, contractual interest or an unenforceable penalty. Neither did the court examine whether the additional sum bore a reasonable relationship to the breach complained of or whether the award of both the outstanding balance of Kshs. 206,000/= and the additional sum of Kshs. 400,000/= was legally justified in the circumstances of the case. 2. In the circumstances, I find that although the Respondent proved her entitlement to the outstanding balance of Kshs. 206,000/=, she did not establish a sufficient legal basis for the additional award of Kshs. 400,000/= as damages and interest. The learned trial magistrate therefore fell into error by awarding that sum without first determining its legal character and enforceability. Consequently, the appeal succeeds in part. The award of Kshs. 400,000/= is hereby set aside, while the award of Kshs. 206,000/= is upheld. **Disposition** 42. In the end I make the following orders: - a. The appeal is partially allowed. b. The judgment and decree of the Senior Principal Magistrate in Nkubu ELC Case No. 47 of 2020 delivered on 4th December 2024 is hereby varied to the extent that the award of Kshs. 400,000/= made in favour of the Respondent is set aside. c. The award of Kshs. 206,000/= being the outstanding balance due under the agreement dated 20th April 2015 is upheld. e. The order of the trial court on the costs of the suit is upheld. It is so ordered. Right of appeal 28 days. Dated, signed and delivered virtually on TEAMS at Nairobi on this 31st day of July, 2026. **……………………………** **Hon. R. A. Oganyo, Mrs.** **Judge.** **In the Presence of; -** Court Assistant…E, Sana