New Milimani Sacco Limited v Arifa Enterprises Solutions (Claim E29248 of 2025) [2026] SCC 91 (KLR) (3 July 2026) (Judgment)

**REPUBLIC OF KENYA** **IN THE SMALL CLAIMS COURT AT NAIROBI** **CLAIM NO. E29248 OF 2025** **NEW MILIMANI SACCO LIMITED…………...…………………CLAIMANT** **VERSUS** **ARIFA ENTERPRISES SOLUTIONS…………………….…RESPONDENT** **JUDGMENT** 1. The claimant instituted this claim vide the statement of claim dated 27/2/2025 seeking judgment against the respondent for Kshs. 544,850/=, costs of the suit and interest. It was the claimant’s case that the parties entered into a contract on 24/11/2021 for the installation of a Sacco Management System and the claimant paid the respondent Kshs. 704,850/= as a deposit towards the project. That the respondent failed to deliver the system and the claimant terminated the agreement through a notice dated 20/2/ 2023 and also sought for full refund of the deposit. That the respondent then made stalled refunds leaving a balance of Kshs. 544,850/= which remained due. 2. The respondent filed a response and counter-claim dated 7/5/2025 denying the claim for refund. It was pleaded that the respondent performed its obligations under the agreement and indeed developed and deployed the Arifa Enterprise Solutions and Arifa 360 Mobile Application. The respondent blamed the claimant for any implementation delays as it failed to provide necessary data and cooperation despite repeated requests. 3. The respondent also averred that it completed various project stages, including system configuration, demonstrations, mobile application development, procurement and HR modules, and system deployment efforts. That the claimant however terminated the contract despite substantial work having been completed and thereafter pressured the Respondent into refunding Kshs. 160,000/= through threats of exclusion from future business opportunities. That the refund was thus made was under duress and denies owing the Claimant any money. 4. The respondent also counter-claimed for Kshs. 455,150.00/= on the basis that the sum was the unpaid balance of the contractual sum of Kshs. 1 million out of which the claimant only paid Kshs. 704,850/= after deducting the refunds of Kshs. 160,000/= already paid back to the respondent. To that, the claimant filed a reply dated 17/6/2025 and maintained its case as summarized above. It was pleaded that the contract was clear on timelines which the respondent failed to meet. That all requested for data was availed and the respondent failed to deliver and further acknowledged its failure and made part payments. The claimant also denied owing the respondent any sums. 5. The claim proceeded under ***Section 30 of The Small Claims Court Act*** thus the witness statements and documents filed by the parties were produced by consent. The claimant filed submissions dated 20/2/2026. The respondent’s were not on record. I have considered the submissions on record as well as the pleadings and documents before this court. 6. I have seen and considered the pleadings, testimonies, evidence and submissions before court. The main issue for determination is whether the claimant has proven that the claim as against the respondent. 7. The standard of proof in civil claims is on a balance of probabilities. See the Court of Appeal in **Mumbi M'Nabea v David M.Wachira [2016] eKLR**. 8. ***Sections 107, 108 and 109 of the Evidence Act, Chapter 80 of the Laws of Kenya*** places the burden of proof of a fact on the person who wishes the court to believe in the existence of such fact. 9. I have considered the entire record. It was not denied that the parties entered into the contract dated 24/11/2021 for installation of a Sacco Management System. The deposit of Kshs. 704,850/= paid to the respondent was also not contested. The contract stipulated that the respondent was to deliver the final product on or before 28/2/2022 or when the claimant was satisfied that the software was satisfactory. There was the email communication of 20/2/2023 wherein the claimant communicated that despite undertakings to compete the project, the same remained pending. The claimant thus effectively terminated the contract. 10. Though the respondent alleged that it had substantially completed the project, it did not produce any evidence to support such allegations. For instance, there was no completion certificates, acceptance documents, invoices, or even correspondence to allude towards completion. No demand for balances was made. 11. Further, the respondent admitted refunding Kshs. 160,000/=. This Court is not convinced that the respondent could possibly have refunded any amount if at all it had completed the project and any balances were owing to it. The respondent’s conduct was more consistent with the claimant's position that the parties had moved to a refund arrangement following non-performance. Had the respondent fully performed its obligations and believed that the claimant owed it the balance of the contract sum, it would be difficult to reconcile that position with its decision to commence refunding monies already received. Though the respondent attributed the refunds to duress and threats, no evidence was produced to support those allegations. The allegations therefore remain mere assertions. 12. It was upon the respondent to produce cogent evidence to prove completion of the project within timelines, or proof of the claimant’s satisfaction such as receipts, invoices, agreements, payment records or other documentary proof demonstrating both the occurrence of the loss and the exact amount claimed. The claimant bore the burden of proving each head of claim to the required standard. 13. I do place reliance on the case of **Palace Investment Ltd v Geoffrey Kariuki Mwenda & Another [2015] eKLR,** where the Court of Appeal held that the burden of proof in civil cases is discharged on a balance of probabilities and that a party must adduce evidence upon which a court can properly find in his favour. In the present case, though the claimant established that the project remained incomplete despite lapse of the deadline period, the respondent failed to discharge the burden to proof that the works were complete and the claimant was in arrears of the balances, if any. 14. As such, on a balance of probabilities, I do find that it is more likely that the respondent failed to complete the project on time, and upon the claimant’s termination of the contract and subsequent demand for refund, the respondent refunded a total of Kshs. 160,000/= leaving the sums claimed due and owing. As such, I do find that the claim is successful. 15. On the other hand, the respondent’s counterclaim was not sufficiently proven and the same cannot succeed. 16. In the end, I do find that the claim is merited. To that end, I hereby order as follows: - 17. **Judgment is hereby entered in favour of the claimant as against the respondent for the sum of Kshs. 544,850/= plus interest at court rate from the date of judgment till payment in full.** 18. **The claimant is awarded costs Kshs. 35,000/=.** 19. **The respondent’s counter-claim is hereby dismissed with no orders as to costs.** 20. The respondent is awarded 30 days stay of execution. **It is so decreed.** **DATED** and **DELIVERED** at **NAIROBI** via **CTS** this 3rd Day of July 2026 **** **HON. GLADYS .W. KIAMAH** **RESIDENT MAGISTRATE/ADJUDICATOR**