[2022] KEHC 77 (KLR)

Muthoni Kamau t/a Muthoni Kamau Advocates v Zamzam A. Abib t/a Abib & Associates Advocates (Miscellaneous Application E477 of 2021) [2022] KEHC 77 (KLR) (Commercial and Tax) (4 February 2022) (Ruling)

Neutral citation: [2022] KEHC 77 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Commercial Courts Commercial and Tax Division)

Commercial and Tax

Miscellaneous Application E477 of 2021

DAS Majanja, J

February 4, 2022

Between

Muthoni Kamau t/a Muthoni Kamau Advocates

Applicant

and

Zamzam A. Abib t/a Abib & Associates Advocates

Respondent

Ruling

1. The parties to this suit are Advocates. The Applicant has moved the Court by the Originating Summons dated 22nd June 2021, made inter alia, under Order 37 of the Civil Procedure Rules seeking resolution of the following questions:a.Whether the Respondent Zamzam A. Abib trading as the firm of Abib & Associates Advocates should be compelled by an order of this Court to forthwith pay to the Applicant the sum of Kshs. 4,000,000/- together with interest at court rates from 21st February 2019 until payment in full.b.Whether the Respondent should be compelled to meet and/or pay the costs of the proceedings.

2. The Summons is supported by the Applicant’s supporting affidavit sworn on 22nd June 2021. The Respondent opposed the application by his replying affidavit sworn on 30th August 2021. Both parties filed written submissions and cited several authorities in support of their respective positions.

3. The facts giving rise to this case are not in dispute. By a letter dated 21st September 2018 (‘the Undertaking’), the Respondent wrote to the Applicant as follows:Dear Madam,RE: AMANI VILLAGE – RELEASE OF FILESWe refer to the above matter wherein we have instruction from our clients the developers to issue you with our irrevocable professional undertaking which we hereby do as follows:1. That on receipt of the sale proceeds, we shall immediately remit to your bank account (of your preferred choice) the sum of KES. 1,000,000/- within 30 days from today’s date.

2. The balance of Kenya Shillings Four Million (KES 4,000,000/-) one hundred and twenty days from today’s date.Accordingly, please proceed as a matter of urgency to release the entire file to our office for our further action.SIGNEDABIB Z. A.

4. In response to the aforesaid letter, the Respondent wrote to the Applicant the letter dated 24th September 2018 confirming that, ‘’Following your professional undertaking of 21st September 2018 we hereby release all the files for the aforementioned project in our custody for your further action and safekeeping.’’ The Applicant confirms that she received the KES. 1,000,000. 00 leaving the balance of KES. 4,000,000. 00 which is yet to be paid in accordance with the Undertaking which despite demand, she has not received.

5. The Respondent does not deny that he issued the Undertaking. He depones that he issued it upon instructions from his client in order to secure release of files relating to Amani Village in consideration of payment of KES. 5,000,000. 00. He states that it was understood that the Undertaking was pegged on receipt of sale proceeds from the Client as such the obligation would only crystallize on receipt of the said funds. He contends that this was duly communicated to the Applicant via email wherein he informed the Respondent that he would pay her and indeed paid KES. 1,000,000. 00 once he received the money in accordance with the Undertaking and which was paid to her in two instalments by cheque on 23rd November 2018; KES 950,000. 00 and KES. 50,000. 00.

6. The Respondent avers that the Applicant made a demand for payment of KES. 4,000,000. 00 on 2nd June 2021 yet she stated that it was purportedly due on 21st February 2019 which was according to her 150 days from the date of the Undertaking. The Respondent adds that the Applicant has not given any reasons why she would make the demand after 2 years and 4 months if the payment had crystallized purportedly on 21st February 2019. He maintains that the delay in making the demand is an admission by the Applicant that the Undertaking was conditional on receipt of the sale proceeds.

7. The issue in this case involves the interpretation given to the Undertaking and whether it was absolute or unconditional.

8. The Applicant submits that it is only Clause 1 of the Undertaking that was premised on receipt of funds from the Client while Clause 2 was only conditioned on the lapse of one hundred and twenty (120) days which have since lapsed. She relies on the decision in Harit Sheth T/A Harit Sheth Advocate v K. H. Osmond T/A K. H. Osmond Advocate NRB CA Civil Appeal No. 276 of 2001 [2011] eKLRin which the Court of Appeal set out the nature of an Advocate’s undertaking and its consequences. The court observed as follows:One last point we need to comment on is the submission by Mrs. Rashid, that the appellant and his client should have followed the debtor, […], to recover the money it owes. In her view this case is peculiar and the Court should depart from the usual practice of enforcing professional undertakings. With due respect to the learned counsel, a professional undertaking is given to an advocate on the authority of his client. It is based on the relationship which exists between the advocate and his client. An advocate who gives such a professional undertaking takes a risk. The risk is his own and he should not be heard to complain that it is too burdensome and that someone else should shoulder the responsibility of recovering the debt from his own client. A professional undertaking is a bond by an advocate to conduct himself as expected of him by the court to which he is an officer. No matter how painful it might be to honour it, the advocate is obliged to honour it if only to protect his own reputation as an officer of the court. The law gives him the right to sue his client to recover whatever sums of money he has incurred in honouring a professional undertaking. He cannot however sue to recover that amount unless he has first honoured his professional undertaking.

9. In response, the Respondent insists that the Undertaking was conditional and the parties understood it as such. He cites the dicta of the court in Conrad Masinde Nyukuri & another v Robson Harris & another MLD HCCC No. 17 of 2017 (OS) [2021] eKLR where the following passage was from Halsbury’s Laws of England (4th Ed.) Vol. 44(1), pages 222, 223, 224, that, “If an undertaking is conditional, the condition must be fulfilled before the undertaking will be enforced.” He also cites what the Court of Appeal stated in relation to a conditional Undertaking in Arthur K. Igeria t/a Igeria & Co. Advocates v Michael Ndaiga NRB CA Civil Appeal No. 51 of 2008 [2017] eKLRas follows:For the court to enforce a professional undertaking, it must be satisfied that the undertaking is clear in its terms and that there is no dubiety or ambiguity as to what the advocate has professionally undertaken. Secondly, that what is undertaken is capable of being performed. Thirdly, that if the undertaking is contingent on the happening or occurrence of an event, such event has occurred or happened.

10. The Respondent argues that the Applicant cannot seek to enforce a conditional undertaking when she is fully aware that the underlying condition has not been fulfilled in order to warrant enforcement of the undertaking. Since it argues that the undertaking is conditional, the Advocate’s duty under a professional undertaking does not extend to compelling the client to pay since an Advocate may not exercise coercive authority over a client.

11. Having considered the aforesaid arguments, I take the following view of the matter. Parties are free to agree on the terms of an undertaking and once agreed and consummated in writing the court can only give effect to the terms of the undertaking as agreed by them. The parties’ terms of the Undertaking which I have reproduced at para. 3 above show that the first KES. 1,000,000. 000 was conditional upon receipt of sale proceeds and this was done accordingly. I hold that the balance of KES. 4,000,000. 00 was unconditional and therefore payment is due under the Undertaking.

12. As long as the claim is not time barred, I do not consider, at least in the basis of the facts in this case, that the Applicant waived her right to apply to this court for enforcement.

13. For reasons I have set out above, I make the following orders:a.The Respondent is directed to honour the undertaking contained in the letter dated 21st September 2018 within thirty (45) days of this order by paying to the Applicant KES. 4,000,000. 00. b.The issue of costs is reserved upon compliance with (a) above.

DATED AND DELIVERED AT NAIROBI THIS 4TH DAY OF FEBRUARY 2022. D. S. MAJANJAJUDGECourt of Assistant: Mr M. OnyangoMr Ngugi instructed by Igeria and Ngugi Advocates for the ApplicantMr Ogunde instructed by Walker Kontos Advocates for the Respondent.