Patriotic Group of Companies Ltd v Family Bank Ltd (Civil Appeal E1235 of 2024) [2026] KEHC 8143 (KLR) (Civ) (4 June 2026) (Judgment)

Patriotic Group of Companies Ltd v Family Bank Ltd (Civil Appeal E1235 of 2024) [2026] KEHC 8143 (KLR) (Civ) (4 June 2026) (Judgment) Neutral citation: [2026] KEHC 8143 (KLR) Republic of Kenya In the High Court at Nairobi (Milimani Law Courts) Civil Civil Appeal E1235 of 2024 D Mburu, J June 4, 2026 Between Patriotic Group Of Companies Limited Appellant and Family Bank Limited Respondent (An appeal from the ruling of Hon. A. Nyoike, SPM, delivered on 30th September 2024 at the Milimani Commercial Chief Magistrate’s Court in MCCC/E4523/2023) Judgment 1.By a Memorandum of Appeal dated 25th October 2024, the Appellant lodged an appeal to this court against the ruling of the Chief Magistrate’s Court delivered by Hon. A. Nyoike (SPM) on 30th September 2024 in Nairobi Milimani MCCC/E4523/2024. 2.The appellant instituted Civil Suit No. E4523 of 2023 against the respondent at the Milimani Commercial Magistrate’s Court vide a Plaint dated 24th August 2023 which was filed in court on 9th October 2023. The respondent duly entered appearance and filed a statement of defence plus a notice of preliminary objection dated 19th March 2024 contending that the suit was time-barred pursuant to section 4(1) of the Limitation of Actions Act, Cap 22 Laws of Kenya, and that the plaint was incurably defective. In a ruling delivered on 30th September 2024, the Hon. Magistrate upheld the preliminary objection thereby striking out the appellant’s suit holding that the cause of action arose on 31st March 2015. Aggrieved by the said ruling, the appellant lodged this appeal. 3.The Appellant raised the following grounds of appeal:1.The learned trial magistrate erred grossly in law and in principle in allowing the respondent’s preliminary objection which raised a factual point rather than a pure point of law as by law established.2.The learned trial magistrate erred in law and in principle in holding that the appellant’s cause of action arose on 31st March 2015 and ignored the pleadings which clearly stated that the appellant only became aware that the respondent had paid the post-dated cheques much later when the respondent demanded a repayment of the amounts.3.That the learned trial magistrate erred and misdirected herself as to the pleadings before her thereby arriving at a wrong decision that the cause of action arose on 31st March 2015 when it was clear that the respondent did not file any statement of defence so as to allow an evaluation of the factual issue on when the cause of action arose.4.That the learned magistrate erred in law and in principle in holding that, the appellant’s suit was time barred in line with section 4(1) of the Limitation of Actions Act, Cap 22 Laws of Kenya in total disregard of the appellant’s plaint before her showing that the cause of action arose on 31st August 2021 and was therefore timely.5.That the learned magistrate erred in law and in principle in finding that the preliminary objection raised by the respondent was merited contrary to the well established principle that a preliminary objection cannot be raised where facts have to be ascertained.6.The learned magistrate wholly erred in law and fact in arriving at the said decision thus causing a miscarriage of justice by unfairly striking out the appellant’s suit. 4.The Appellant therefore seeks that the appeal be allowed with costs, that the ruling delivered by the Hon Magistrate be set aside and quashed. 5.The appeal was canvassed by way of written submissions. I have carefully considered the parties’ respective submissions. The Appellant submitted that the trial court erred by treating the disputed date of accrual of the cause of action as a pure question of law when in fact it was central to the disputed and required evidential determination. The appellant further faulted the trial court for finding that the cause of action arose on 31st March 2015 as opposed to 13th August 2021 “as consistently pleaded by the appellant.” The appellant argued that its cause of action arose from its wrongful listing with the Credit Reference Bureau (CRB) by the respondent. It was further submitted on behalf of the appellant that the appellant did not become aware of the listing until 13th August 2021 upon conducting a credit status check as it had not been issued with any notice of intention to list. 6.The respondent contended that its preliminary objection before the lower court raised a pure point of law on the question of limitation. The respondent submitted that the date when the cause of action arose was not a contested fact as the same had been clearly pleaded in the plaint, and that the preliminary objection was founded on section 4(1) of the Limitations of Actions Act, Cap 22. 7.The respondent further submitted that the trial court rightly determined that the cause action arose on 31st March 2015 as borne out in paragraphs 3 to 16 of the Plaint and therefore, the six-year limitation period for claims founded on contract had already lapsed. The respondent specifically referred to the particulars of breach of contract pleaded at paragraph 16 of the plaint whereby the plaintiff refers to events that occurred on 31st March 2015 and therefore maintained that the cause of action herein arose on 31st March 2015. 8.The respondent therefore urged the court to find that the appeal lacks merit and dismiss it with costs. Analysis and Determination. 9.Two main issues arise for determination by this court. Firstly, whether the issue raised in the respondent’s preliminary objection before the trial court was a pure point of law, and secondly, whether the trial court was right in upholding the said preliminary objection. 10.In the case of Mukisa Biscuit Manufacturing Co. Ltd v West End Distributors Ltd (1969) E.A 696 Law J at Page 700 stated as follows: -“So far as I am aware, 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. Examples are an objection to the jurisdiction of the court or a plea of limitation or a submission that the parties are bound by the contract giving rise to the suit to refer the dispute to arbitration….” 11.The quoted dictum therefore implies that a preliminary objection must consist of pure points of law which have been pleaded or which arise by clear implication out of the pleadings. This was the holding of J. B. Ojwang, J. in the case of Oraro v Mbaja [2005] eKLR where he stated thus: -“I think the principle is abundantly clear. A “preliminary objection”, correctly understood, is now well identified as, and declared to be a point of law which must not be blurred with factual details liable to be contested and in any event, to be proved through the processes of evidence. Any assertion which claims to be a preliminary objection, and yet it bears factual aspects calling for proof, or seeks to adduce evidence for its authentication, is not, as a matter of legal principle, a true preliminary objection which the Court should allow to proceed. I am in agreement with learned counsel, Mr. Ougo, that “where a Court needs to investigate facts, a matter cannot be raised as a preliminary point.” 12.I have looked at the plaint filed by the appellant in the lower court. At paragraph 5 of the plaint, the appellant avers “that on 31st March 2015, the bank (respondent) banked and/or honoured the said cheques issued to Linear Credit before the due date, which cheques were dated 2nd April 2015, despite clear instructions not to proceed with the same.” 13.At paragraph 16 of the plaint, the appellant has set out particulars of breach of contract by the respondent as follows:a.Negligently paying out six cheques amounting to Kshs. 5,450,000/= following clear instructions not to.b.Negligently overdrawing the plaintiff’s account with such a huge sum without authorization, overdraft facility and/or a credit arrangement in place.c.Deliberately ignoring instructions not to honour the cheques and allowing payments to Linear Credit without notifying and/or alerting the plaintiff.d.Negligently paying post-dated cheques before the due date and without notice.e.Continuing to levy and impose unauthorized interest and penalties on the account accumulating allegedly Kshs. 6,078,570/-.f.Failing to notify the plaintiff when the cheques were presented and later honoured.g.Failing to acknowledge an error in honouring the cheques and overdrawing the plaintiff’s account when there were no enough funds in the said account or credit arrangements.h.Failing to communicate with the plaintiff concerning their overdrawn account before sending Garth Auctioneers to demand payments.i.Failing to furnish the plaintiff with a notice to show cause why it should not be negatively listed under the Credit Reference Bureau.j.Failing to furnish the plaintiff with an adverse notice to show cause why it should not be negatively listed under Credit reference Bureau.k.Irregularly and unprocedurally providing Credit Reference Bureau with the plaintiff’s financial status.l.Maliciously and indolently listing the plaintiff as a loan defaulter under the Credit Reference Bureau.m.Issuing threats to the plaintiff through its agents to settle the overdrawn position which they were not even aware of.n.Failing to correct the error of negatively listing the plaintiff with the Credit reference Bureau despite their lack of knowledge of how the account was overdrawn with such a large amount.” 14.I have cited the above extract from the plaint in order to demonstrate that the plaintiff’s claim is undoubtedly founded on events that took place on the 31st March 2015. That is the plain and clear language used in paragraphs 16(a) to (h). Even though the appellant alleges that it has consistently pleaded that the cause of action accrued on 13th August 2021, there is absolutely no reference to that date in the plaint. There is no reference to any other date in the plaint except 31st March 2015. Invariably, this court hereby concludes that from the wording used in the plaint, there is no doubt that the cause of action accrued on 31st March 2015. The trial court needed not carry out factual inquiries, as the respondent in its defence had not disputed the said date. 15.Consequently, I do hereby find and hold that the respondent’s preliminary objection raised a pure point of law and therefore, the learned trial magistrate was right in holding, as she did, that the preliminary objection was properly before the court. 16.On the second issue, I have already found that the cause of action accrued on 31st March 2015. The suit in the lower court, founded on contract, was filed on or about 9th October 2023. This was about eight years and six months after the date when the cause of action accrued. 17.As rightly submitted by counsel for the respondent, the limitation period runs from the date the cause of action accrued and not when a party alleges to have discovered the wrongdoing. Section 4(1)(a) of the Limitation of Actions Act Cap 22 Laws of Kenya provides that actions founded on contract may not be brought after the end of six years from the date on which the cause of action accrued. The question of limitation touches on jurisdiction and the court has no jurisdiction to entertain a matter filed outside the statutory limitation period as was held in the case of Bosire Ongero v Royal Media Services [2015] eKLR. Similarly, in the case of Mutuku v Multichoice Kenya Limited & Another (Cause E1039 of 2023) [2024] KEELRC 1028 (KLR) (17th April 2024) the court held thus:“it is trite law that issues of limitation of time go to the jurisdiction of the court.” 18.Flowing from the foregoing, I do hereby find and hold that the Hon. Magistrate was right in upholding the respondent’s preliminary objection and striking out the suit for having been filed out of time. Consequently, this appeal lacks merit and is hereby dismissed with costs to the respondent. DAVID MBURUJUDGE04/06/2026Dated, signed, delivered virtually via Microsoft Teams and uploaded to the Case Tracking System (CTS) this 4th day of June 2026.In the presence of;…………………………………………..……………......…….…Court Assistant………………………………………………….….…………….for the Appellant.…….………………………………………………………….for the Respondent