NCBA Bank Kenya Plc v Simiyu & another (Civil Appeal E243 of 2025) [2026] KEHC 9876 (KLR) (7 July 2026) (Judgment)

NCBA Bank Kenya Plc v Simiyu & another (Civil Appeal E243 of 2025) [2026] KEHC 9876 (KLR) (7 July 2026) (Judgment) Neutral citation: [2026] KEHC 9876 (KLR) Republic of Kenya In the High Court at Kisumu Civil Appeal E243 of 2025 AM Hassan, J July 7, 2026 Between NCBA Bank Kenya Plc Appellant and Francisca Nekesa Simiyu 1st Respondent Robert Kimani Wafula 2nd Respondent (Being an Appeal from the Ruling and Orders of the Honourable Maureen Nyigei, Senior Principal Magistrate, delivered on 27th October 2025 in Kisumu CMCC No.36 of 2020) Judgment A. Introduction/ Facts Of The Case 1.The Plaintiff (now 1st Respondent), vide a Plaint dated 31st January 2020, instituted a suit against Defendants. Subsequently, she amended her pleadings through an Amended Plaint dated 4th October 2023, which substituted the Original Plaint and set out the reliefs sought against the Defendants. 2.In the Amended Plaint dated 4th October 2023, the Plaintiff sought judgment against the Defendants for a permanent injunction restraining the 3rd Defendant (now Appellant), its agents or servants from repossessing or seizing motor vehicle registration number KCK 753T Isuzu NKR lorry from her possession, a declaration that she was entitled to settle the outstanding balance of the purchase price amounting to Kshs. 200,000 directly to the 3rd Defendant, and a declaration that the 1st and 2nd Defendants (now 2nd Respondent) had acted illegally in selling the suit motor vehicle without the requisite legal capacity. In the alternative, she sought an order compelling the 1st Defendant to refund Kshs. 1,000,000/= paid as the purchase price of the motor vehicle. Additionally, she prayed for costs of the suit, interest on the refunded sum at court rates, and any other relief that the court deemed just and equitable to grant. 3.In response, the 3rd Defendant opposed the application contending that there was no contractual relationship between them and the Plaintiff. The 3rd Defendant stated that, the contractual relationship between the them and the 2nd Defendant, emanated where the 3rd Defendant advanced the 2nd Defendant a loan facility of Kshs. 1,558,200/= for purposes of purchasing the suit motor vehicle and that the same was registered jointly in the names of the 2nd & 3rd Defendants. The 3rd Defendant averred that they were strangers to any agreement between the Plaintiff and 2nd Defendant. 4.The court upon taking into consideration the pleadings, the oral and documentary evidence adduced, and the filed written submissions, delivered judgement on 3rd September 2024, where it declared that the 2nd Defendant lacked the legal capacity to sell the motor vehicle to the 1st Defendant without informing the 3rd Defendant for loan reassignment, thus breaching their contract, and that the 1st Defendant’s sale of the vehicle to the plaintiff without disclosing the loan status was in bad faith and meant to defraud the Plaintiff. 5.Consequently, the Plaintiff was ordered to forward Kshs. 200,000/= to the 3rd Defendant advocates within 30 days. The 3rd Defendant was to share the statement of account with the 1st and 2nd Defendants, and the Plaintiff within 14 days, and the 1st and 2nd Defendants were to clear the outstanding loan within 60 days. If they were to fail, the 3rd Defendant was at liberty to execute against them through property attachment and sale or a notice to show cause for civil jail. The motor vehicle was to remain in the Plaintiff’s custody until further court orders, and the costs of the suit were awarded to the Plaintiff and the 3rd Defendant, payable by the 1st and 2nd Defendants. The case was to be mentioned in 60 days to confirm compliance and for further directions. 6.The Plaintiff (now 1st Respondent), having fully complied with the directives issued by the court, commenced the process of executing the decree. Consequently, she filed a Notice of Motion dated 20th June 2025 seeking, inter alia, an order compelling the 3rd Defendant to transfer motor vehicle registration No. KCK 753T Isuzu Lorry to her, and in default, an order directing the Registrar of Motor Vehicles to effect the transfer and issue a new logbook. 7.In response, the 3rd Defendant (now Appellant) opposed the Motion through a replying affidavit and written submissions terming the said application as fatally defective, misconceived, and an abuse of the court process, that ought to be dismissed with costs. 8.The court heard the application and delivered a ruling on 27th October 2025 where the court granted orders for transfer of ownership of the suit motor vehicle registration number KCK 753 T Isuzu lorry to the 1st Respondent. 9.Being dissatisfied with the decision of the court, the 3rd Defendant lodged the present appeal vide a Memorandum of Appeal dated 17th November, 2025, raising the following grounds: -1.The learned Magistrate erred in law and fact in failing to consider in its totality, the Appellant’s Defence as tendered and put forth by the Appellant in the trial court and the evidence furnished in support of the Appellant’s claim which demonstrated among others subsisting debt owed to the Appellant by the 2nd Respondent.2.The Honourable learned Magistrate erred in law and fact in failing to consider the Appellant’s submission and authorities in arriving at her finding.3.That the learned magistrate erred in law by misinterpreting the judgement of Hon. E. A. Obina which expressly required the 2nd respondent and another to clear the balance of the outstanding loan owing to the Appellant within 60 days of that decision. By constituting it to mean that the 1st respondent acquired proprietary ownership in the vehicle, the court altered and extended the judgement beyond its clear terms.4.That the learned magistrate erred in law by granting orders for transfer of the suit Motor Vehicle Registration No. KCK 753T to the 1st Respondent when no such relief was ever sought in the Amended Plaint dated 4th October 2023 and no such relief was granted in the judgment of 4th September 2024.5.That by granting an un-pleaded remedy, the learned Magistrate violated the principle that parties are bound by their pleadings and reconstructed the 1st Respondent’s case after judgement.6.That the trial court having already pronounced itself in the main judgment, the succeeding court was functus officio and could not, under the guise of execution, vary, amend or enlarge the final judgment so as to confer new rights by purporting to issue orders of transfer of title.7.That the learned Magistrate erred in law by disregarding the Appellant’s registered security interest under the Chattels Mortgage and the Movable Property Security Rights Act, 2017.8.The learned Magistrate erred in law and fact by failing to appreciate that the trial court had declined to confer ownership rights on the 1st Respondent and had instead preserved the Banks right to pursue the outstanding loan.9.That the court’s order compelling transfer of ownership before full repayment extinguished a registered security right without lawful cause, contrary to both statute and Article 40 of the constitution on protection of property rights.10.That the learned Magistrate erred in law by directing the Registrar of Motor Vehicles to transfer the logbook to the 1st Respondent, thus usurped the statutory framework governing secured transactions and interfered with Appellant’s proprietary rights11.That the learned Magistrate erred in law and fact in failing to dismiss the Respondent’s application which finding was contradictory and against the weight of the evidence and submissions tendered. 10.The Appeal was canvassed by way of written submissions. As this is a first appeal, this court is obligated to reconsider, re-evaluate and reanalyse the evidence adduced before the trial court and draw its own independent conclusions, while bearing in mind that it did not have the benefit of seeing or hearing the witnesses testify. This duty was succinctly set out in Selle & Another v Associated Motor Boat Co. Ltd & Others [1968] EA 123 B. Submissions By Parties Appellant’s Submissions 11.The Appellant’s general argument was that the Application dated 20th June 2025 that provoked this Appeal was not an execution application in the proper sense, but an invitation to re-open, enlarge, and vary the judgment of the trial court delivered by Hon. E.A. Obina on 4th September, 2024. 12.The Appellant’s first issue for determination was whether the learned magistrate erred by granting a transfer order that was neither pleaded in the amended plaint nor granted in the judgment of 4th September 2024. The Appellant submitted that the Amended Plaint dated 4th October 2023 primarily sought a refund of monies paid and injunctive relief against repossession, but not a compulsory transfer of the vehicle or issuance of a new logbook. They also submitted that, the judgment of Hon. E. A. Obina, did not order the transfer of the suit vehicle. 13.In support of their position, the Appellant’s relied on David Sironga Ole Tukal v. Francis Arap Muge & 2 Others [2014] eKLR, where it was held that courts should not grant remedies not applied for or determine issues not pleaded, that parties are bound by their pleadings for certainty and finality; and that a party cannot raise a different case without amendment. Further reliance was placed on Raila Amolo Odinga & Another v. IEBC & 2 Others [2017] eKLR, where the Supreme Court reaffirmed that parties are bound by their pleadings, and that courts can only determine issues arising from those pleadings and the evidence properly tendered in support thereof. 14.On whether the payment of Kshs. 200,00/= extinguished the bank’s security interest, the Appellant submitted that it had advanced a loan facility of Kshs. 1,558,200/= to the 2nd Respondent, which was secured by a chattel mortgage over the suit motor vehicle. Further, they submitted that as at 7th July 2025, the outstanding loan balance stood at Kshs. 1,045,508.66, a fact that was not controverted by the Respondents. They argued that the payment of Kshs. 200,000 by the 1st Respondent did not constitute full settlement of the secured debt, discharge of the chattel mortgage, or satisfaction of the secured obligation, but merely formed part of a post- judgment payment arrangement. 15.The Appellant further submitted that its security interest remained valid and enforceable notwithstanding the partial payment, as the secured obligation had not been fully discharged. Reliance was placed on Section 65(1)(b) of the Movable Property Security Rights Act, 2017, which preserves a secured creditor’s right to enforce its security, including repossession of the collateral, until the secured obligation is fully satisfied. The Appellant argued that the partial payment made by a third-party purchaser could not defeat the Bank’s security rights, particularly where the vehicle remained encumbered and the outstanding debt remained unpaid. It was further submitted that, by ordering the transfer of the suit motor vehicle without payment of the outstanding loan, the learned magistrate effectively deprived the Appellant of its status as a secured creditor and converted it into an unsecured claimant without any legal basis, thereby occasioning an error warranting appellate intervention. 16.The Appellant further submitted on the issue that the impugned ruling was not an execution, but a variation and enlargement of the judgment. They submitted that the impugned ruling did not amount to lawful execution of the judgment but rather constituted an impermissible variation and enlargement of the original judgment. The appellant argued that, while courts retain limited post-judgment jurisdiction to supervise execution and deal with incidental matters, the doctrine of functus officio bars a court from re-opening the merits of a concluded case or altering the substance of its judgment under the guise of execution. 17.In support of their position, the Appellant relied on Telkom Kenya Ltd v John Ochanda [2014] eKLR, where the Court of Appeal held that once a final judgment has been entered and a decree issued, a court cannot review or alter its decision except within the narrow-recognized exceptions and that the doctrine serves finality. Therefore, if one is dissatisfied with the judgment, the proper course is appeal or review, not a post-judgment motion seeking a remedy never granted. 18.The Apellants also submitted that, although courts retain powers in execution proceedings as recognized in Nderitu & 55 Others v Telkom Kenya Limited & Another [2024] KEHC 2297 (KLR), such powers do not extend to rewriting or materially altering a judgment. They contended that the original judgment contained no decree compelling transfer of the suit motor vehicle, no declaration extinguishing the Bank’s security interest, no finding that the partial payment of Kshs. 200,000 discharged the outstanding loan, no order directing Registrar of Motor vehicles to issue a new logbook. Accordingly, the Appellant maintained that the impugned ruling did not merely execute the judgment but in effect created new substantive rights that were never contemplated in the original judgment 19.In response to the 2nd Respondent’s submissions, Appellant argued that the appeal did not seek to challenge or reopen the original judgment delivered by Hon. Obina, but rather targeted the post-judgment ruling by Hon. Nyigei on the basis that it improperly enlarged and varied the terms of the original judgment. It was submitted that the absence of an appeal against the original judgment does not legitimize orders that were never granted therein 20.The Appellant further submitted that the Respondents’ reliance on the Appellant’s alleged failure to provide a loan statement could not, in law, justify the drastic remedy of transferring ownership of the suit motor vehicle. It was contended that any such procedural issue could only warrant appropriate case management directions such as a compliance order or an inquiry into accounts, and not a substantive proprietary order affecting the Bank’s security interest. Accordingly, the Appellant maintained that the learned magistrate erred by enlarging and varying the original judgment of a court of concurrent jurisdiction, and urged this court to allow Grounds 5 and 6 of the Memorandum of Appeal. 21.The Appellant framed their last issue as a reply to the respondents’submissions. The Appellant contended that the 1st Respondent failed to address the central issues raised in the appeal, particularly whether the prayer for transfer of the suit motor vehicle had been pleaded, whether such an order had been granted in the judgment, and how the Bank’s registered security interest had been lawfully discharged. The Appellant submitted that these omissions left the substantive grounds of appeal unanswered. 22.The Appellant further submitted that although the 2nd Respondent’s submissions were more elaborate, they were founded on an erroneous premise. They argued that the equities of the matter favoured the Appellant, having advanced the loan facility on the strength of the suit motor vehicle as security and with the debt remaining outstanding. Therefore, any claim by the 1st Respondent ought properly to be directed against the persons from whom she purchased the vehicle or those obligated under the judgment to settle the outstanding loan, rather than against the Bank’s subsisting security interest. 23.Therefore, the Appellant sought orders setting aside the ruling of 27th October 2025, dismissing the Respondent’s application with costs, declaring its rights to retain its interest over motor Vehicle KCK 753T until full loan repayment and discharge of the security, and awarding it the costs of both the appeal and the lower court proceedings. 1st Respondent’s Submissions 24.The 1st Respondent’s first issue for determination was whether the trial court misinterpreted the judgment of her predecessor. The 1st Respondent submitted that the judgment required the Plaintiff to pay Kshs. 200,000 to the 3rd Defendant and that she duly complied with that order. She further submitted that the Appellant failed to comply with the directive requiring it to furnish the 1st and 2nd Defendants with a statement of account within fourteen days of the judgment. 25.The 1st Respondent argued that the judgment provided a mechanism for recovery of any outstanding debt in the event of default by the 1st and 2nd Defendants, including execution through attachment and sale of property or by way of a notice to show cause. However, no appeal was lodged against the judgment and the Appellant had itself relied on the judgment in pursuing recovery of the debt. It was therefore contended that, having complied with the court’s orders and having been awarded the suit motor vehicle, the 1st Respondent was entitled to the vehicle’s logbook, without which ownership and enjoyment of the vehicle would be incomplete. 26.The 1st Respondent’s last issue for determination was whether the trial magistrate erred in law by granting orders for the transfer of ownership of Motor Vehicle Registration Number KCK 753T Isuzu Lorry to the 1st Respondent. The 1st Respondent submitted that the learned magistrate properly exercised her jurisdiction in granting the transfer orders, as the same were necessary to give effect to and implement the judgment previously delivered by Hon. Obina. 27.The 1st Respondent further submitted that the judgment in the main suit was never appealed against and contained directives on compliance, which the 1st Respondent duly fulfilled. According to the 1st Respondent, the Appellant did not dispute such compliance and, in the circumstances, the trial court was justified in granting the transfer orders sought. 28.The 2nd Respondent had not filed his submission by the time of writing the judgment herein. 29.In the circumstances, I have considered the appeal from both the Appellant and the Respondent’s submissions and I therefore wish to have the following as issues for determination; C. Issues For Determinationi.Whether the learned Magistrate, in granting the orders sought in the Notice of Motion dated 20th June 2025, varied or enlarged the judgment delivered on 4th September 2024 contrary to the doctrineVV of functus officio.ii.Whether the order directing transfer of Motor Vehicle Registration No. KCK 753T Isuzu Lorry to the 1st Respondent was granted in the absence of a pleaded or decreed relief, contrary to the principle that parties are bound by their pleadings and the final decree.iii.Whether the trial court erred in law in issuing transfer orders that interfered with the Appellant's registered security interest over Motor Vehicle Registration No. KCK 753Tiv.Who bears the costs of the proceedings in the trial court and of this appeal. D. Analysis And Determination Whether the learned Magistrate, in granting the orders sought in the Notice of Motion dated 20th June 2025, varied or enlarged the judgment delivered on 4th September 2024 contrary to the doctrine of functus officio. 30.The Appellant contends that the ruling delivered on 27th October 2025 amounted to an impermissible variation and enlargement of the judgment delivered on 4th September 2024, as the trial court had become functus officio upon delivery of its final decision. The 1st Respondent maintained that the impugned orders were merely in execution of the judgment. 31.The doctrine of functus officio, anchored on the principle of finality in litigation, bars a court from revisiting or altering its final decision save for limited statutory exceptions. In Telkom Kenya Ltd v John Ochanda [2014] eKLR, the Court of Appeal affirmed that once a final judgment is delivered, the court becomes functus officio and cannot reopen or vary it outside the narrow limits permitted by law. 32.Execution proceedings are therefore confined to enforcing a decree as issued and cannot be used to introduce new substantive rights or alter the terms of the judgment. Any order that changes the rights determined in the judgment amounts to an impermissible enlargement of the decree. In Kamau Mucuha v The Ripples Ltd [1993] eKLR, the Court of Appeal emphasized that a court cannot take any step that alters or adds to its final judgment under the guise of execution. 33.In the present case, the judgment of 4th September 2024 did not order transfer of ownership of Motor Vehicle Registration No. KCK 753T nor extinguish the Appellant’s security interest, but merely provided for payment and settlement of the outstanding loan. The subsequent order of 27th October 2025 introduced transfer of ownership to the 1st Respondent, thereby conferring a substantive proprietary right not contained in the judgment. 34.As held in Bernard Mugo Ndegwa v James Nderitu Githae & 2 Others [2010] eKLR, execution proceedings cannot be used to grant reliefs not awarded in the judgment, as that would amount to an impermissible extension of the court’s decision. In the circumstances, I find that the learned Magistrate, in granting the impugned orders, varied and enlarged the judgment contrary to the doctrine of functus officio. Whether the order directing transfer of Motor Vehicle Registration No. KCK 753T Isuzu Lorry to the 1st Respondent was granted in the absence of a pleaded or decreed relief, contrary to the principle that parties are bound by their pleadings and final decree. 35.The Appellant further contends that the transfer order was neither sought in the Amended Plaint nor granted in the judgment and that the learned Magistrate therefore erred in issuing the same. 36.A cardinal principle of civil litigation is that parties are bound by their pleadings and that a court's determination must be founded upon the issues arising therefrom. The rationale behind the principle is to ensure fairness, certainty, and orderly adjudication by enabling each party to know the case it is required to meet. In Galaxy Paints Company Ltd v Falcon Guards Ltd, eKLR, the Court of Appeal held that issues for determination in a suit generally flow from the pleadings and that a court can only pronounce itself on matters placed before it by the parties. 37.I have revisited the pleadings, the reliefs sought including declaratory orders, injunctive relief, and in the alternative a refund of the purchase price. No substantive prayer sought transfer of ownership of Motor Vehicle Registration No. KCK 753T or issuance of a logbook in favour of the Plaintiff. Equally, the judgment delivered on 4th September 2024 did not grant such relief. The decree arising therefrom similarly contains no order directing transfer of ownership. 38.It is true that a court executing a decree may issue ancillary or consequential directions necessary to facilitate implementation of its judgment. However, consequential orders must remain incidental to the decree and cannot amount to substantive remedies that were neither pleaded nor granted at trial. 39.In the present case, transfer of ownership was not merely procedural. It was a substantive proprietary remedy affecting legal rights in the motor vehicle. By granting such an order after judgment, the trial court effectively introduced a relief that had not formed part of the original litigation. I therefore find that the impugned transfer order lacked a foundation in both the pleadings and the decree and was consequently issued in error. Whether the trial court erred in law in issuing transfer order that interfered with the Appellant’s registered security interest over Motor Vehicle Registration No. KCK 753T 40.The Appellant contends that the suit motor vehicle was financed through a loan facility secured in its favour and that the outstanding loan had not been fully settled at the time of the impugned ruling, thereby preserving its security interest. It was argued that the order directing transfer of the motor vehicle to the 1st Respondent improperly interfered with that subsisting security. The 1st Respondent, on the other hand, maintains that she complied with the judgment by paying Kshs. 200,000/= and was therefore entitled to ownership and transfer of the vehicle as part of the fruits of the judgment. It is however evident that the said payment was made pursuant to the judgment and did not amount to satisfaction or discharge of the underlying secured loan facility owed to the Appellant. 41.It is not disputed that the Appellant financed the purchase of the suit motor vehicle by the 2nd Respondent and that the vehicle was jointly registered in their names as security for repayment of the loan facility. It is equally apparent from the judgment delivered on 4th September 2024 that the trial court recognized the existence of an outstanding loan balance and directed the parties liable therefor to settle the same. 42.Section 65 of the Movable Property Security Rights Act, 2017 preserves the rights of a secured creditor to enforce a security interest until the secured obligation has been fully discharged. Accordingly, a security interest over movable property remains enforceable unless the debt secured thereby has been satisfied or otherwise lawfully extinguished. 43.In Mrao Ltd v First American Bank of Kenya Ltd & 2 Others [2003] eKLR, the Court of Appeal recognised that a chargee’s interest in secured property constitutes an enforceable proprietary right which subsists until the secured obligation is discharged. The Court emphasised that such interest is not merely contractual but a legally protected proprietary interest enforceable in accordance with the law. A similar position was taken in Habib Bank AG Zurich v Pop-In (Kenya) Ltd & 3 Others [1992] eKLR, where the Court affirmed that a secured creditor’s rights over charged property remain protected and enforceable so long as the debt remains outstanding. 44.In the present case, there was no evidence before the trial court demonstrating that the outstanding loan had been fully settled or that the Appellant had discharged its security interest in the motor vehicle. Indeed, the original judgment expressly preserved the Appellant's right to pursue recovery of the outstanding debt. 45.In those circumstances, the order directing transfer of the motor vehicle to the 1st Respondent had the effect of prejudicing the Appellant's subsisting security interest notwithstanding the acknowledged existence of an outstanding secured debt. Such an order was inconsistent with both the terms of the judgment and the statutory protection accorded to secured creditors. 46.Consequently, I find that the learned Magistrate erred in issuing orders that interfered with the Appellant's registered security interest over Motor Vehicle Registration No. KCK 753T before the secured obligation had been fully discharged. Who bears the costs of the proceedings in the trial court and this appeal 47.On the issue of costs, the general principle governing costs is that costs follow the event, and the successful party is ordinarily entitled to be awarded costs unless the court, for good reason, orders otherwise. This principle is anchored in Section 27 of the Civil Procedure Act, which vests discretion in the Court to determine costs, the primary consideration being the outcome of the proceedings and the conduct of the parties. 48.In the present appeal, the Respondent has successfully opposed the appeal, which has been dismissed in its entirety. There is no material placed before this court to justify a departure from the general rule on costs, either in respect of the trial court proceedings or this appeal. Accordingly, the Appellant is entitled to the costs of this appeal, and the costs of the proceedings in the trial court shall likewise follow the outcome as determined by the subordinate court E. Disposition 49.Having carefully considered the pleadings, the record of appeal, and the rival submissions by counsel, together with the applicable law and authorities, this court now proceeds to render its determination on the issues arising for resolution in this appeal as follows:-(a)Appeal herein succeeds and is hereby allowed.(b)The ruling and consequential orders of the Honourable Maureen Nyigei, Senior Principal Magistrate, delivered on 27th October 2025 in Kisumu CMCC No. 36 of 2020 are hereby set aside in its entirety.(c)For avoidance of doubt, the orders directing transfer of Motor Vehicle Registration No. KCK 753T Isuzu Lorry to the 1st Respondent are hereby vacated and set aside.(d)The judgment and decree of the trial court delivered on 4th September 2024 shall remain the operative decree and shall be executed strictly in accordance with its express terms and the law.(e)The Appellant is awarded costs of this appeal.(f)The costs of the application dated 20th June 2025 in the trial court are awarded to the Appellant.It is so ordered. HON. JUSTICE ABDI M. HASSANKISUMU HIGH COURT HIGH COURT CIVILDATE: 2026-07-07 11:33:04