[2022] KEHC 11138 (KLR)

Muiruri v Njoki (Civil Appeal 60 of 2020) [2022] KEHC 11138 (KLR) (16 June 2022) (Judgment)

Neutral citation: [2022] KEHC 11138 (KLR)

Republic of Kenya

In the High Court at Kiambu

Civil Appeal 60 of 2020

MM Kasango, J

June 16, 2022

Between

Mbugua Muiruri

Appellant

and

Beth Njoki

Respondent

(Being an appeal from the Ruling the Chief Magistrate’s Court at Kiambu (T Nyangena, SPM) in CM Civil Case no 134 of 2018 dated April 29, 2020)

Judgment

1. This appeal seeks determination whether the trial court, Kiambu chief magistrate’s court erred in determining it had jurisdiction over the matter before it.

2. Background of the appeal is that a suit was filed by Beth Njoki the respondent before the Kiambu chief magistrate’s court. In that case, the respondent pleaded that she and the appellant Mbugua Muiruri agreed to partner and to start a transportation business. To that end, they agreed to purchase an Isuzu lorry on credit facility. They obtained a loan in their joint names. The agreement was that the profit of the operation of that lorry would be used to pay the loan facility. To that end, the appellant and respondent opened a joint bank account. The lorry was, with the agreement of both parties, kept under the control of the appellant. That loan was finally paid. The respondent pleaded the appellant ignored or refused to account to the respondent the profits made in the transport business. That although the parties entered into a Memorandum of Understanding (MOU), whereby the respondent was supposed to take over the control of the transport business and thereby recoup her unaccounted share of profits, the defendant as pleaded before the trial court failed to release to the respondent the said lorry and failed to account to her the profits made.

3. The respondent’s prayers before the trial court were for:-(i)Declaration that the appellant did not have exclusive right over the lorry.(ii)Declaration on severity the joint ownership of the lorry.(iii)An order for mandatory injunction requiring appellant to release the lorry to the respondent.(iv)An order for appellant to account to the respondent her share of profit.(v)In the alternative, the lorry be valued and be sold and the proceeds be shared between the parties.

4. Appellant raised a preliminary objection on two grounds, that is:-(a)That the trial court lacked jurisdiction to hear and determine the suit as per the Partnership Act.(b)That the partnership property was above the jurisdictional limit of the trial court.

5. The trial court by its ruling of April 29, 2020 dismissed the preliminary objection on the basis the suit before court related to the motor vehicle and the case was founded on MOU. The court therefore determined it had jurisdiction to entertain the action.

Analysis 6. I have considered the parties written submission. The appeal relates to an interlocutory ruling. It follows this court will avoid making determination that would determine the main action.

7. In the case Hassan Ali Joho & Another vs Suleiman Said Shabal & 2 others SCK Petition no 10 of 2013 (2014) eKLR the Supreme court had this to say on what a preliminary objection is:-“a preliminary objection consists of a point of law which has been pleaded or which arises by clear implication out of pleadings and which if argued as a preliminary point may dispose of the suit”

8. The Partnership Act (herein after the Act) defined a partnership is under Section 3(1):-“3(1) Partnership is the relation which subsists between persons carrying on a business in common with a view of profit.

9. Black’s Law Dictionary Tenth Edition defines partnership as:-“A voluntary association of two or more persons who jointly own and carry on a business for profit.”

10. The respondent by her pleadings before the trial court pleaded that she partnered with the appellant to commence transport business. They obtain a loan jointly. The lorry was registered in both their names. The respondent’s grievance was that the appellant failed to account and share with her the profits of that business. In the case Hellen Wangari Wangechi vs Carumera Muthoni Gathua(2015) eKLR the court broke down the provisions of section 3 of the act and stated:-“Learned author E R Hardy Ivamy in his work “Principles of the Law of Partnership’’At page 3 of the same book, the learned author continues as follows:-‘Let us examine the definition a little more closely. There are three essential facts without which no partnership can exist. There must be:(i)a business;(ii)carried on in common;(iii)with a view of profit.’”

11. It is clear that from the above, the respondent’s pleading reveal that the relationship between her and appellant was a partnership. The pleadings shows the business squarely fell within the definition of partnership in section 3 of the Act. I therefore differ with the trial court’s finding.

12. If it was a partnership did the trial court have jurisdiction to determine the dispute? The answer to that question lies within the definition of “court” in section 2 of the Act. that Section provides:-“In this Act, except where inconsistent with the context- “court” means the High Court or, where the gross assets of a partnership do not exceed fifty thousand shillings, the Resident Magistrates Court.”

13. The trial court was not the High Court, rather it was the magistrate’s court. Further, although I was unable to see in the pleadings the value of the lorry, I however noted that the loan granted by the Bank to enable purchase of that lorry in July, 2015 was kshs 2,928,599. It would follow that the value of the lorry was in excess of the pecuniary jurisdiction of the magistrate’s court to entertain a partnership dispute.

14. It is because of the above finding that I find the appeal must and does succeed. The trial court as provided under the Partnership Act had and has no jurisdiction to entertain the suit.

Disposition 15. In the end, the judgment of this court is:-(a)The appeal hereby succeeds and the preliminary objection dated December 20, 2018 is allowed with costs.(b)The appellant is awarded the costs of this appeal.

JUDGMENT DATED AND DELIVERED AT KIAMBU THIS 16TH DAY OF JUNE, 2022. MARY KASANGOJUDGECoram:Court assistant : MouriceFor the appellant: AmutaraFor the respondent :- Mr KamauCourtJudgment delivered virtually.MARY KASANGOJUDGE