https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/10532

Megawatt Technologies Ltd v Greenlight Planet Kenya Ltd t/a Sunking Kenya (Commercial Case E253 of 2025) [2026] KEHC 10532 (KLR) (19 June 2026) (Ruling) Neutral citation: [2026] KEHC 10532 (KLR) Republic of Kenya In the High Court at Kiambu Commercial Case E253 of 2025 MN Mwangi, J June 19, 2026 Between Megawatt Technologies Ltd Applicant and Greenlight Planet Kenya Ltd t/a Sunking Kenya Respondent Ruling 1.The plaintiff/applicant filed a Notice of Motion application dated 29th October 2025 pursuant to Order 13 Rule 2 of the Civil Procedure Rules. It seeks orders for entry of judgment on partial admission and release of the admitted amount of Kshs.27,716,862.00 held by the defendant/respondent at NCBA Bank, owing to the respondent’s admission that the money belongs to the applicant. The applicant also seeks costs of the application. 2.The application is premised on the grounds on the face of it, the affidavit sworn on 29th October 2025 by Mr. Martin Gichana, a Director and Shareholder of the applicant. Mr. Gichana averred that the applicant supplied goods worth Kshs.54,748,386.00 to the respondent who refused to pay despite numerous reminders, which prompted the filing of this suit. He stated that the respondent filed a defence and counterclaim where it admitted that it owes Kshs.27,716,862.00, for which it illegally exercises a lien, and has even arrogated itself an interest of 12% per annum. He stated that the respondent has admitted that when the said sum is subtracted from the total sum, it owes the applicant Kshs.17,922,245.34. 3.Mr. Gichana deposed that a party cannot arrogate itself the role of a judge and arbitrarily declare interest over the amount as if the party took out a loan and is servicing it. He relied on the provisions of the Banking Act and the Central Bank of Kenya Act which give details of loans and interest chargeable. 4.He cited the maxim of ‘ex turpi causa non oritur action’, meaning that the respondent herein cannot make an admission and at the same time seek the Court’s indulgence over its illegal conduct. Mr Gichana posited that the applicant has suffered prejudice and financial hardship due to the illegal lien, which the respondent has admitted belongs to the applicant. He argued that the continued illegal lien will cause the applicant to be unable to meet its financial obligations which can lead to insolvency. He also cited the maxim of ‘nemo dat quod non habet’, to state that no one can give what they do not have, meaning that the respondent does not have title of the impugned admitted sums and it should therefore transfer it to the owner (applicant). 5.Mr. Gichana deposed that parties are bound by their pleadings and since the respondent has already admitted the debt, it cannot illegally hold the money and charge interest as it will be contrary to the Banking Act and the Central Bank of Kenya Act. He averred that the applicant was the respondent’s supplier and not the vendor, and that the goods the applicant delivered were for the onward sale by the respondent’s vendors. He stated that the respondent has continued holding the monies to the applicant’s detriment. He urged this Court to allow the application and order the respondent to deposit the admitted sums to the applicant’s bank account. 6.In opposition to the application, the respondent filed a replying affidavit sworn on 11th November 2025 by its Finance Controller, Ms Salome Waithira. She deposed that the respondent engaged the applicant to supply it with mobile phones which were worth Kshs.54,720,000/= and not Kshs. 54,748,386.00 as claimed. She stated that the allegation by the applicant that the respondent refused to pay for the goods is both misleading and in bad faith. 7.Ms Waithira stated that in December 2024, a forensic audit was done by MGC Global Risk Advisory LLP which showed anomalies in payments made to vendors, including the applicant, as there were inconsistencies with the bank records and the accounting books. She stated that the Report revealed duplicate and unauthorized payments of Kshs.27,031,524.00 paid to the applicant facilitated by the respondent’s former employees, Messrs. Nachors Mwendwa and Robert Langat. She claimed that the applicant through its CEO admitted the overpayments of the said sum. 8.She claimed that she reached out to the applicant’s team for reconciliation of accounts which was not done, but instead a demand letter was issued to them. She stated that the respondent replied to the demand letter and clarified that the applicant had misappropriated funds to the tune of Kshs.27,031,524.00. Ms Waithira averred that because of the loss owing to the misappropriation, it would be levying interest at 12% per annum, for three years being an amount of Kshs.9,766,230.00 which should be deducted from the amount payable of Kshs.54,720,000/= leaving a balance of Kshs.17,922,245.34. She claimed that the loss of use of its money and the interest of Kshs. 9,766,230.00 cannot be deducted from the main claim and it should be determined in the respondent’s counterclaim. She maintained that the proper amount for adjudication is Kshs.17,922,245.34. 9.Her assertion was that the interest the respondent claims is not a loan, but compensation for deprivation of funds due to the applicant’s retention of overpaid amounts which is supported by commercial practice and the principle of restitution. She also stated that the interest being claimed is not under the Banking Act or the Central Bank of Kenya Act, but it is a civil remedy for wrongful retention of funds. She averred that the sums are subject to lawful set off and lien, due to the applicant’s involvement in fraudulent transactions. 10.She stated that the sum of Kshs.17,922,245.34 is being withheld pending the determination of concurrent criminal investigations by the DCI, due to the misappropriation, and that the DCI stated that the applicant is not cooperative in the said investigation. 11.Ms Waithira maintained that the respondent communicated its reasons for the lien and contended that any payment to the applicant should be subject to the lawful setoff. She urged this Court to find that the application is premature and based on material distortion of facts and dismiss it with costs to the respondent. 12.The application was canvassed by way of written submissions. The applicant filed submissions dated 22nd December 2025 through the law firm of K.O.M. Advocates LLP. The respondent filed submissions dated 14th January 2026 through the law firm of Hamilton Harrison & Matthews Advocates. 13.Mr. Ateka, learned Counsel for the applicant cited the case of Guardian Bank Limited v Jambo Biscuits Kenya Limited [2014] KEHC 1796 KLR, wherein it was stated that admission must be clear and unequivocal on plain perusal of the admission, to warrant judgment being entered. 14.He argued that the respondent in its defence and counterclaim admitted that the amount in contention is Kshs.27,031,524.00, which the respondent seeks to set off, following an overpayment which the applicant denied. He asserted that the admission is unequivocal which does not require interpretation. He placed reliance on the case of Choitram & another v Nazari [1984] KECA 47 (KLR), which held that an admission must be plain and obvious. He also cited the case of Cassam & another v Sachania & another [1982] KECA 1 (KLR), where the Court stated that an admission should be clear and unequivocal, so that a Court can exercise its discretion. 15.Counsel submitted that the admission made by the respondent is unequivocal since it stated that it was exercising an illegal lien over the amount that is not in dispute, in anticipation of a favourable judgment. He contended that the respondent is stepping into the role of a judge as well as executioner. Mr. Ateka relied on the case of Choitram & another v Nazari (supra), where it was held that where the admission is plain and obvious, there is no need for the matter to go for trial since nothing would be gained in the trial. 16.He argued that the respondent admitted that the applicant supplied goods worth Kshs.54,748,386.00; that the goods were indeed supplied; and that there was an overpayment to the applicant of Kshs.27,031,524.00. He stated that the respondent admitted that it is unlawfully holding the applicant’s sum of Kshs.27,716,862.00, in anticipation of a win and set off, of the remaining amount. He stated that following the said admission, there is no need for the matter to go to trial. 17.Mr Ateka posited that parties are bound by their pleadings and relied on the case of Associated Electrical Industries Ltd v William Otieno [2004] eKLR, in support of the assertion. He stated that since the respondent admitted the debt in its pleadings it should be bound by the said admission. He urged this Court to allow the application and grant the orders sought in the application. 18.Mr. Makori, learned Counsel for the respondent, stated that the application was filed pursuant to Order 13 Rule 2 of the Civil Procedure Rules, but the applicant has not met the threshold required. He stated that the applicant in the Plaint claimed Kshs.77,954,509.00 for loss of benefits in the contract. He submitted that the respondent in the defence confirmed that the payable amount under the contract was Kshs.54,720,000/= and counterclaimed Kshs.27,031,524.00, being the amount misappropriated by the applicant’s duplicate and unauthozised payments. He stated that the respondent deducted the overpayment of Kshs Kshs.27,031,524.00 with the interest at 12% per annum for three years, in the sum of Kshs.9,766,230.00, leaving a balance Kshs.17,922,245.34. He stated that the respondent has withheld the said balance pending the determination and outcome of concurrent criminal investigations by the DCI on misappropriation of funds. 19.Mr. Makori relied on the Text by Mulla, The Code of Civil Procedure, 18th Ed Vol 2 at page 2093, on the definition of judgment on admission. He refuted the assertion that the defence filed by the respondent amounts to an admission. He stated that the defence addressed the set off, of the amount due to the respondent and the withheld amount of Kshs.17,922,245.34, pending the hearing and determination of the DCI investigations. He stated that the applicant is misleading the Court since it claims that the goods delivered were worth Kshs.54,748,386.00, which is not correct as they were worth Kshs.54,720,000/=, and the discrepancy cannot be resolved summarily. He stated that the overpayments were made out of fraud, and that the respondent is justified to levy interest which amounts to Kshs.9,766,230.00, which has been contested, and as such, the issue should be addressed at trial. 20.Counsel relied on the case of Scanad Kenya Limited v Independent Electoral & Boundaries Commission [2021] KEHC 7348 (KLR), where the Court declined to enter judgment on admission since the issue of interest had not been determined. He submitted that even if the interest claimed was to be added to the withheld amount of Kshs.17,922,245.34, the total would be Kshs.27,688,475.34, which is still less than the applicant’s claim of Kshs.27,716,862.00. He stated that the cases cited by the plaintiff of Simal Velji Shah v Chemafrica Limited [2014] KEHC 1474 (KLR) and Choitram & another v Nazari (supra), support the refusal to enter judgment. 21.He argued that the amount alleged to be admitted bears no support either on the pleadings or supporting documents, making it necessary for the Court to determine the entire claim at trial. He contended that the admissions are not clear or unequivocal to warrant judgment on admission. He urged this Court to dismiss the application with costs. Analysis And Determination. 22.I have considered the application and the affidavit in support thereof and the replying affidavit by the respondent. I have also considered the written submissions filed by Counsel for both parties. The issue for determination is if the Court should enter judgment on admission. 23.Order 13 Rule 2 of the Civil Procedure Rules, 2010, provides for judgment on admission. It states as follows-“Any party may at any stage of a suit, where admission of facts has been made, either on the pleadings or otherwise, apply to the Court for such judgment or order as upon such admissions he may be entitled to, without waiting for the determination of any other question between the parties; and the Court may upon such application make such order, or give such judgment, as the Court may think just.” 24.The Court of Appeal discussed judgment on admission in the case of Choitram v Nazari (supra), where Madan, JA stated as follows: -“For the purpose of Order XII Rule 6, admission can be expressed or implied either on the pleadings or otherwise, e.g. in correspondence. Admissions have to be plain and obvious, as plain as a pikestaff and clearly readable because they may result in judgment being entered. They must be obvious on the face of them without requiring a magnifying glass to ascertain their meaning. (Emphasis added).Admissions of fact under Order XII rule 6 need not be on the pleadings. They may be in correspondence or documents which are admitted or they may even be oral. The rules used words “otherwise” which are words of general application and are wide enough to include admission made through letter, affidavits and other admitted documents and proved oral admissions... It is settled that a judgment on admission is in the discretion of the Court and not a matter of right that discretion must be exercised judicially. (Emphasis added). 25.Based on the above authority, a Court will only enter judgment on admission where the admissions are plain and obvious and where it does not involve a matter which requires consideration of complex evidence and matters of law. In this case, the applicant filed a Plaint dated 2nd April 2025 seeking various orders, including judgment for the sum of Kshs.77,954,509.00 for loss of benefits under the contract of sale. The applicant also sought interest on the said amount, at commercial rates from December 2024 out of which sum, the value of the goods delivered was Kshs.54,748,386.00. The respondent filed a defence, counterclaim and set off dated 14th July 2025, wherein it stated that the actual value of the goods delivered was Kshs.54,720,000/=. 26.This Court notes that in the counterclaim, the respondent claimed that a sum of Kshs.27,031,524.00 was overpaid to the applicant as stated in the forensic audit conducted by MGC Global Risk Advisory LLP, which Report established that the said unauthorized payments were made by the respondent’s employees, Messrs Nachors Mwendwa and Robert Langat. The respondent claimed a refund of Kshs.27,031,524.00. In the set off, the respondent stated that through a letter dated 26th March 2025, it informed the applicant that it would deduct the overpayment from the total amount of Kshs.54,720,000/=. It also indicated that it would charge interest in the sum of Kshs.27,031,524.00, amounting to Kshs.9,766,230.00, making a total amount of Kshs.36,797,754.00, which should be set off in the amount claimed by the applicant, leaving the sum payable at Kshs.17,922,245.34. The respondent prays for judgment in the sum of Kshs.27,031,524.00, interest of Kshs.9,766,230.00 from 17th January 2025. It also prays for interest for the sum of Kshs.27,031,524.00 from the date of filing the suit until payment in full. It also prays for judgment on the right to set off, and costs. 27.It is the said defence, counterclaim and set off that has given rise to the present application, wherein the applicant seeks entry of judgment in the sum of Kshs.27,716,862.00 withheld by the respondent. The question that this Court must answer is whether the admission in the defence, counterclaim and set off, is plain, obvious and unequivocal. to warrant entry of judgment on admission. 28.This Court finds that the actual value of the goods delivered is contested given that the applicant states that the amount due was Kshs.54,748,386.00, whereas the respondent claims in the defence that the value of the goods delivered was Kshs.54,720,000/=, which gives a discrepancy of Kshs.28,386.00 which also leads to discrepancies in the amount for setting off. 29.There is also the issue of the interest earned by the applicant, if any, on the alleged misappropriated payments, which in this Court’s view, requires going into trial to establish the veracity of the audit report by MGC Global Risk Advisory LLP, which can only be done through examination-in-chief of its makers, cross-examination and re-examination. The Court will also need to conduct trial to establish whether the amount claimed by the respondent as interest is justified or not. 30.Given the discrepancies in the amounts being claimed as due and owing by each party, this Court finds that it cannot enter judgment on admission, as the alleged admission is not obvious and as plain as a pikestaff. Material evidence is required to establish the amount owed and the overpayments made, if any. If any interest is due on the alleged overpayments, it must be resolved through evidence. 31.This Court therefore finds that it cannot exercise its discretion as the facts and circumstances of this case require trial to be conducted. This Court relies on the case of Synergy Industrial Credit Limited v Oxyplus International Limited & 2 others [2021] KEHC 13344 (KLR), where it held as follows-“In conclusion, it can be said that judgment on admissions under Order 13 Rule 2 is not a matter of right. It is discretionary and should be exercised judicially on the facts and circumstances of each case. The underlying object of the rule is to enable a party to obtain speedy judgment on admission in respect of admitted claims pending disposal of disputed claims in a suit. It is not binding on the court to pass a decree. A decree can be passed only to the extent of admitted claims for which admissions are clear, unequivocal and unambiguous. There is no specific form of admission required for a court to pass a decree. It may be contained in pleadings or otherwise. It may be in writing or may even be oral. Even in cases where some dispute has arisen over any admission, judgment on such admission can be passed unless there is sufficient material on record to prove the admission is vague. Moreover, if an admission can be inferred from the facts and circumstances of the case without dispute, the court can pass a judgment on such admission. 32.The upshot in this matter is that the Notice of Motion application dated 29th October 2025 lacks merits. It is hereby dismissed with costs to the defendant/respondent.It is so ordered. DATED, SIGNED AND DELIVERED IN KIAMBU ON 19TH DAY OF JUNE 2026. RULING DELIVERED THROUGH MICROSOFT TEAMS ONLINE PLATFORM.NJOKI MWANGIJUDGEIn the presence of:Mr. Odhiambo h/b for Dr. Kembero for the plaintiff/applicantMr. Mwendwa h/b for Mr. Makori for the defendant/respondentMs Julia – Court Assistant.