https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/13089

Republic v Riungu & another (Criminal Appeal E146 of 2025) [2026] KEHC 13089 (KLR) (25 August 2026) (Judgment) Neutral citation: [2026] KEHC 13089 (KLR) Republic of Kenya In the High Court at Kibera Criminal Appeal E146 of 2025 DR Kavedza, J August 25, 2026 Between Republic Appellant and Perez Mawira Riungu 1st Respondent Johnson Munene John 2nd Respondent (Being an appeal against the acquittal delivered by Hon. A. Mwangi (C.M) 6th October 2025 at Kibera Chief Magistrate’s Court Criminal Case No. 1121 of 2019) Judgment 1.The Respondents were jointly charged with the offence of stealing by servant contrary to section 281 of the Penal Code. The particulars of the offence are that on diverse dates between 1th January 2018 and 30th June 2019 at unknown place within the Republic of Kenya, jointly, being employees of Option One Distributors (E.A) Limited stole consignments of cement valued at Kshs. 30,043,656.81 the property of Option One Distributers (EA) Limited, which came to their possession by virtue of their employment. After a full trial, the two Respondents were acquitted. 2.Aggrieved by the acquittal, the Director of Public Prosecutions lodged the present appeal. The Appellant contends that the trial court failed to properly evaluate the prosecution evidence and erred in acquitting the Respondents. It urges this Court to set aside the acquittal, substitute it with convictions and impose appropriate sentences. 3.As this is a first appeal, this Court is under a duty to reconsider, re-evaluate and reappraise the evidence on record and draw its own independent conclusions, bearing in mind that it neither saw nor heard the witnesses testify. (See Okeno v Republic [1972] EA 32.) 4.The prosecution called 11 witnesses in support of its case.PW1, a director of Option One Distributors, testified that the complainant was a family business engaged in the distribution of fast-moving consumer goods and building materials, including cement. The business had several branches managed by managers, accountants, stock controllers and transport personnel. In 2019, the directors noted a deterioration in the company’s cash flow, inability to service debts and increasing overdrafts. A forensic audit was consequently commissioned. The preliminary audit disclosed an unexplained loss of about Kshs.22 million, while the final report dated 15th August 2019 placed the loss at Kshs.39,967,000. The witness stated that the matter was reported to the police through the company’s advocate, MM Gitonga. She identified the 1st respondent as the accountant and the 2nd respondent as the transport manager. 5.PW1 explained that the material commodity in the case was cement. The company would pay the cement manufacturers before loading, after which the cement would be collected and delivered to the complainant’s premises. The 2nd respondent, Johnson Munene, dealt with the transport arrangements, while the 1st respondent, Perez Mawira, was involved in the accounting and payment processes. The witness stated that the company maintained an internal audit system, but the quarterly audits had not detected the material irregularities. She further testified that daily reports, including expense reports, deliveries and balances brought forward, were prepared and that the reports given by the 1st respondent were supplied to the investigating officers. 6.PW2, a director and trustee of the family estate, testified that the complainant was incorporated in 2010 and dealt, inter alia, in cement and other building materials. He stated that the 2nd respondent had initially been employed as his chief of staff and was later appointed transport manager and special projects manager. The 2nd respondent was introduced to the cement manufacturers and was responsible for directing drivers on destinations and coordinating cement deliveries. He stated that the 1st respondent was the accountant and that he received daily sales reports from him. The complainant operated a cash account and maintained bank accounts with Absa, Equity and Family Bank. The 1st respondent authenticated payments for cement, while the 2nd respondent issued instructions concerning the loading and delivery of the cement. 7.PW2 described the procedure for purchasing cement. The complainant would make payment to the cement manufacturer. The payment would be authenticated by the 1st respondent, after which the 2nd respondent would communicate with the manufacturer and issue the necessary instructions and order for loading. A text message confirming payment and loading would be sent to the 2nd respondent. The cement would thereafter be transported to the complainant’s premises, where it would be received by the stock controller, documented and entered into the system by the accountant. The witness stated that the irregularity arose when cement was authorised for loading into vehicles which were not authorised company vehicles. He further referred to two M-Pesa transactions between the respondents and stated that the company ultimately lost over Kshs.39,967,000. 8.In cross-examination, PW2 stated that the complainant had a branch manager, stock controller, cashier, accountant and transport manager. The company had an accounting system to which employees had different levels of access, with the accountant having universal access. He maintained that the stock controller, branch manager and internal auditor had no responsibility for the loss under investigation. He stated that the 1st respondent was based at Keria while the 2nd respondent was based in Nairobi, although the latter also interacted with the Mombasa Road office. 9.PW3, the branch manager at Keria, testified that at the material time the 1st respondent was the accountant and the 2nd respondent the transport manager. The accountant authorised cash payments, including payments for cement, while Timothy Njeru made the actual bank deposits. Drivers collecting cement were issued with LPOs by the 1st respondent, the 2nd respondent or the witness. The cement manufacturers issued invoices and delivery notes, and the documents were subsequently handed to the store manager, Joseph Munyua, who prepared a goods received note. The documentation was then handed to the accountant for entry into the company system. 10.PW3 further testified that trucks not belonging to the complainant were hired by either respondent depending on workload and availability of company trucks. Where a driver was diverted from the original destination, the instruction could emanate from the 1st respondent, the 2nd respondent or the witness. If cement was sold on the way, the driver was required to account for the sale through the relevant cash, invoice and delivery documentation. She discovered that the quantity of cement received did not correspond with the quantity paid for. Upon contacting external drivers, she learnt that some cement had been sold in Chuka, but the corresponding delivery notes and invoices were not presented to the complainant. She estimated that more than 500 bags were unaccounted for. 11.PW3 testified that the company’s system captured invoices, quantities and the cost of cement, with the 1st respondent having full system access. She stated that daily sales reports, receipts summaries, cash reports and expenditure reports were prepared. She also testified that cement was supplied to Mara Ranch and Keria Supermarket, although payment was not always made, and that such supplies were taken into account in assessing the quantities allegedly lost. She confirmed that she had not obtained bank statements to independently verify the banking slips. 12.PW4, the store manager, testified that goods delivered to the complainant were accompanied by invoices and delivery notes. Upon receipt, he verified the quantity, prepared a goods received note and handed the documents to the 1st respondent for entry into the accounting system. The system would then generate the relevant invoice and delivery documentation for onward sale. He stated that the complainant’s cement vehicles were under the responsibility of the 2nd respondent, who was the transport manager. The transport manager coordinated delivery from the manufacturers to the complainant, while delivery from the complainant to customers was under the transport manager and/or accountant. 13.PW4 further stated that the transport manager ensured that trucks were loaded and reached the intended destinations. There were occasions when goods were taken to a different destination upon the direction of the branch manager. He stated that it was the transport manager who could instruct drivers concerning the movement of commodities from the manufacturer to the complainant. He also confirmed that the company used external trucks when demand exceeded its own transport capacity and that Gacheri had requested from him reports and goods received notes relating to cement supplied during the relevant period. 14.PW5, a company driver of motor vehicle KBX 153K, testified that he ferried cement from Kenya Portland Cement and National Cement to Keria. He would leave the store with an LPO issued by the manager, accountant or transport manager, present it to the manufacturer, and receive a pick slip, invoice and delivery note after loading. Upon returning, the documents were handed over for verification and subsequently to the 1st respondent. He stated that he was at times diverted to Mara Ranch on instructions from the 2nd respondent and that the respondents consulted each other concerning drivers’ instructions. 15.PW6, another company driver, testified that he drove motor vehicle KCB 225P FX 21S and ferried cement from Nairobi. He received LPOs from either the 1st respondent or the 2nd respondent. He stated that drivers were sometimes rerouted to other destinations on telephone instructions from either respondent. He further testified that there were occasions when customers paid drivers directly for cement and the money was submitted to the 2nd respondent at Keria. He confirmed deliveries to Mara Ranch, a construction site, and stated that he was told by the 2nd respondent that the site belonged to his boss. 16.PW7, who had worked for the complainant for about 20 years, testified that his duties included collecting money from the cashier and depositing it in the bank. He would hand the deposit slip to the 1st respondent, who would photograph it and send it to the 2nd respondent through WhatsApp. He deposited monies on instructions from the manager, accountant or transport manager, without necessarily knowing the purpose for which the money was being deposited. He was also not aware of Mara Ranch. 17.PW8, a former company driver of motor vehicle KBP 901K, testified that he transported cement from Simba Cement and Blue Triangle to Keria. He received an LPO from the accountant, presented it to the cement manufacturer, and after loading received the relevant invoice, pick slip and delivery note. Upon returning to Keria, he surrendered the documents to the accountant and was instructed where to deliver the cement. Where customers paid cash, he surrendered the money to the cashier. 18.PW9, a company driver of motor vehicle KCB 224P FH, testified that the 1st respondent issued him with LPOs for collection of cement from Blue Triangle and Simba Cement. After loading, he returned to Keria and handed the invoice and delivery note to the accountant, after which the information was entered into the system and he was instructed where to deliver the cement. Customers who paid cash paid through the driver, who remitted the money to the cashier. He stated that he never collected goods without an LPO and that, after collecting cement, drivers were required to pass through the company before proceeding to customers. 19.PW10, a cashier, testified that the 1st respondent was the accountant while the 2nd respondent was the procurement and logistics officer. She received and filed cash and sales slips. She stated that she was informed by Zipporah Gacheri Mbaya of irregularities concerning cement and that the DCI subsequently commenced investigations. According to her, some trucks were selling cement and the proceeds were not reaching the business. She further stated that some of the trucks were not captured in the system, despite the accountant being responsible for making the entries. She could not quantify the value of the cement allegedly lost. 20.PW10 stated that, as cashier, she received cash from drivers and reconciled it with the 1st respondent before Timothy Njeru was sent to bank the money. She testified that some trucks were not entered in the system and that she could not identify all of them. She was not aware of Mara Ranch or having received payment from it. She nevertheless stated that it was not unusual for the 1st respondent to send money to drivers. 21.PW11, a CPA registered and licensed by ICPAK, testified that he was engaged by Jasper Mbiuki in 2019 to conduct a forensic audit concerning suspected fraud and misappropriation at the Keria branch, specifically in relation to cement. He examined the period January 2017 to 30 June 2019. He obtained information from National Cement, which produces Simba Cement, and East African Portland Cement, which produces Blue Triangle Cement, and compared the quantities of cement paid for with those received by the complainant. He stated that the quantities did not tally and that cement worth approximately Kshs.39 million had been paid for but was not received at the complainant’s premises. 22.PW11 testified that he and his team interviewed, among others, Jasper Mbiuki, Lucy Mbiuki, Dennis Gitonga, Zipporah Gacheri, Elizabeth Mwende, Timothy Njeru and drivers Gerald, Vincent Kimathi and Eric. They liaised with the cement manufacturers and established that the cement had been released and that records of the vehicles and drivers involved were maintained. According to the witness, the vehicles used to collect the unaccounted-for cement were outsourced by the 2nd respondent. He stated that the investigation disclosed an arrangement between the accountant, who authorised payment for the cement, and the transport manager, who was responsible for ensuring its collection and delivery to the complainant. 23.In conducting the audit, PW11 relied on the complainant’s electronic accounting system, journals, sales and purchase ledgers, store records, bank records, bank deposit slips, delivery notes and statements from the two cement manufacturers. He prepared a forensic audit report dated 15th August 2019, which he produced in evidence as an exhibit. He stated that the report quantified the loss at approximately Kshs.39,967,000. 24.In cross-examination, PW11 confirmed that he did not produce in Court the deposit slips showing payments to the cement manufacturers or the delivery notes which he had examined during the audit. He explained that the documents were bulky and stated that he relied substantially on the electronic accounting system and the records supplied to him. He further stated that he had interview notes but did not produce them. He acknowledged that some cement was delivered to Mara Ranch but had not included that material in his report and could not determine whether the cement delivered there had been paid for or the exact quantity delivered. 25.In their sworn defence, the 1st respondent, testified that he was employed as an accountant and performed his duties within the company’s established procedures. He maintained that he was never found in possession of the complainant’s cement and that there was no evidence linking him to the alleged theft or its proceeds. 26.The 1st respondent testified that in May 2019 he informed Jasper Mbiuki, a director of the complainant, of his intention to leave employment after about ten years. On 4th July 2019, Jasper summoned him and informed him that Zipporah, the Keria branch manager, had raised concerns that the branch accountant was diverting company cement. Jasper asked him to assist in building a case against the accountant. The 1st respondent declined, stating that he had no evidence linking his co-respondent to the alleged diversion. He testified that Jasper thereafter required him to return the company’s assets and leave. He cleared with the company on 10th July 2019 and was arrested on 29th August 2019. 27.The 1st respondent further testified that the complainant had previously experienced similar incidents involving employees and was insured against theft by servants. He referred to three cases at the Nkubu and Chuka Law Courts in which the company had allegedly been compensated by its insurer. He stated that Jasper wanted him to cooperate in implicating the accountant and that, upon his refusal, he was threatened with loss of his retirement benefits. 28.On the alleged cement discrepancy, the 1st respondent testified that the complainant had four trucks dedicated to transporting cement and that external trucks were legitimately engaged whenever demand was high. He stated that the decision to outsource was made by the sales department and branch manager. Drivers would be contacted, issued with an LPO, collect the cement and deliver it as instructed. 29.He attributed the alleged disparity between cement delivered or sold and the proceeds to the complainant’s dealings with Mara Ranch. He testified that Mara Ranch was involved in construction and sourced cement from Option One. He acted as a link between the project and Jasper Mbiuki and would procure materials required for the projects. Orders for cement would be communicated to the Keria branch, which would arrange for a driver to collect and deliver the cement. He maintained that he was not involved in payment for the cement and that the outsourcing of trucks was authorised. 30.The 2nd respondent, Johnson Munene, testified that he had been appointed transport manager and special projects manager and had responsibility for coordinating transport and managing relationships with cement suppliers. Although he could direct drivers on delivery destinations, he stated that he did not handle cash. He maintained that the 1st respondent was the accountant and prepared the daily sales reports and cash disposal instructions. 31.The 2nd respondent denied that he was responsible for hiring external trucks. He testified that additional trucks were legitimately outsourced when demand was high and that the decision was made by the sales department and branch manager. He maintained that he did not determine which vehicle was assigned to a particular customer and was not mandated to hire external trucks. 32.The 2nd respondent further testified that he worked for both Option One and Mara Ranch. Cement for Mara Ranch was supplied from Option One pursuant to orders originating from the project and authorised by Jasper Mbiuki. He would communicate the orders to the Keria branch, which would arrange delivery. He maintained that he was not involved in the payment for the cement. 33.The 2nd respondent stated that Jasper had asked him to assist in implicating the 1st respondent in the alleged diversion of cement. He declined because he had no evidence linking the 1st respondent to the alleged offence. He maintained that, following his refusal to cooperate, Jasper required him to return the company property and leave employment. 34.After a full trial, both respondents were acquitted accordingly. 35.The appeal was canvassed by written submissions which have been duly considered and there is no need to rehash them. 36.Section 281 of the Penal Code Cap 63 (Laws of Kenya) provides that:“If the Offender is a clerk or servant, and the thing stolen is the property of his employer or came into the possession of the offender on account of his employer, he is liable to imprisonment for seven years." 37.The burden of proving every ingredient of the offence rested upon the prosecution. Sections 107(1), 108 and 109 of the Evidence Act provide:Section 107(1): "Whoever desires any court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts must prove that those facts exist."Section 108: "The burden of proof in a suit or proceeding lies on that person who would fail if no evidence at all were given on either side."Section 109: "The burden of proof as to any particular fact lies on the person who wishes the court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on any particular person." 38.I have reconsidered the evidence on record in its entirety, bearing in mind that this is an appeal against the acquittal of the 1st respondent, Perez Mawira, and the 2nd respondent, Johnson Munene. The issue is whether, notwithstanding the failure by the investigating officer to testify, the evidence adduced by the prosecution was sufficient to establish the charge of stealing by servant contrary to section 281 of the Penal Code beyond reasonable doubt. 39.Section 281 of the Penal Code provides that where the offender is a clerk or servant and the thing stolen is the property of his employer, or came into his possession on account of his employer, he is liable to imprisonment for seven years. The prosecution was therefore required to establish, first, that the respondents were employees of the complainant; secondly, that the property belonged to, or came into their possession on account of, their employer; and thirdly, that the property was dishonestly taken or converted, thereby depriving the employer of it. The offence incorporates the essential ingredients of stealing under section 268 of the Penal Code. This position has been affirmed in Samoei v Republic [2025] KEHC 11593 (KLR) and Kioko v Republic [2022] KEHC 14379 (KLR). 40.On whether the respondents were servants of the complainant, the evidence was direct and unequivocal. PW1, PW2, PW3, PW4 and several of the complainant’s drivers consistently identified the 1st respondent as the accountant and the 2nd respondent as the transport manager. The 1st respondent himself did not dispute his employment. The 2nd respondent similarly acknowledged his employment and his role in transport and special projects. The employment relationship was therefore established beyond reasonable doubt. Indeed, the evidence showed that the respondents occupied positions which gave them access to, and responsibility over, the very processes through which the cement was purchased, transported, received and accounted for. 41.On the second ingredient of the offence charge, the issue is whether the property in issue was owned by the complainant and came into the respondents’ possession by virtue of their employment. The evidence established that the complainant purchased cement from the manufacturers, including Simba Cement and Blue Triangle Cement, for onward sale. PW3, PW4 and the drivers described the established procedure whereby LPOs were issued, cement collected from the manufacturers, and delivery notes, invoices and goods received notes returned to the complainant. 42.The 1st respondent, as accountant, had access to the accounting system and dealt with the relevant documentation and payments. The 2nd respondent, as transport manager, coordinated the transportation and movement of the cement. PW11, the forensic auditor, compared the manufacturers’ records with the complainant’s records and found a substantial unexplained disparity. The evidence therefore established both the complainant’s ownership of the cement and the respondents’ access to it by virtue of their respective employment. 43.The third issue is whether the cement was stolen or dishonestly converted. The prosecution evidence went beyond mere suspicion. PW3 discovered that the quantity of cement paid for by the complainant did not correspond with the quantity received. She contacted external drivers and established that some of the cement had been diverted and sold in Chuka, yet the corresponding invoices and delivery notes were not returned to the complainant. PW11, the forensic auditor, independently examined the manufacturers’ records, the complainant’s accounting records, purchase and sales ledgers, bank records and delivery documentation. His forensic audit quantified the unexplained loss at approximately Kshs.39,967,000. The evidence also established that more than 500 bags of cement were unaccounted for. This was evidence of an actual loss of identifiable property, rather than a mere accounting discrepancy. 44.On the nexus between the loss to the respondents, it was the prosecution’s evidence that the 1st respondent had control of the accounting system and was involved in authorising payments and processing the documentation relating to cement. The 2nd respondent was responsible for transport and directing drivers. The evidence of the drivers was material. They testified that they received instructions from the respondents, sometimes by telephone, to divert deliveries to alternative destinations, including Mara Ranch. There was also evidence of payments and communications between the respondents. PW11 testified that the outsourced vehicles used to collect the cement were connected with the transport function and that the records disclosed an arrangement between the accounting and transport functions through which cement was paid for but was not received by the complainant. 45.The respondents’ respective defences did not displace that evidence. The 1st respondent sought to attribute the discrepancy to the complainant’s dealings with Mara Ranch, while the 2nd respondent maintained that the supplies and use of outsourced trucks were authorised. Those explanations, however, had to be considered against the established evidence that cement paid for was not accounted for at the complainant’s premises and that some of it was diverted without the requisite invoices and delivery documentation. The fact that legitimate diversions or supplies to Mara Ranch occurred did not, without more, account for the substantial quantity of cement which the forensic audit established as unaccounted for. 46.The circumstances constituted circumstantial evidence connecting the respondents to the dishonest conversion. The applicable test is that the inculpatory facts must be incompatible with the innocence of the accused and incapable of explanation upon any other reasonable hypothesis than that of guilt. The Court of Appeal in Musii Tulo vs. Republic (2014) eKLR outlined the principles observed when such evidence as follows;To ascertain whether or not the inculpatory facts put forward by the prosecution are incompatible with the innocence of the appellant and incapable of explanation upon any other reasonable hypothesis than that of guilty, we must also consider a further principle set out in the case of Musoke v. R (1958) EA 715 citing with approval Teper v. R (1952) AL 480 thus: -“It is also necessary before drawing the inference of accused's guilt from circumstantial evidence to be sure that there are no other co-existing circumstances which would weaken or destroy the inference.' 47.In the present case, the evidence of the respondents’ positions, their control over the relevant processes, the unexplained loss, the diversion of cement, the involvement of outsourced vehicles and the documentary and forensic reconciliation, when considered cumulatively, provided a coherent evidential chain pointing to dishonest appropriation. 48.From the record, the prosecution closed their case without calling the investigating officer. The question is what was the effect of that failure? The absence of the investigating officer did not, in the circumstances of this case, extinguish the otherwise cogent prosecution evidence. In Keino v Republic [2024] KECA 710 (KLR), the Court of Appeal reaffirmed that although it is good practice to call the investigating officer, failure to do so does not automatically render a prosecution case fatal. Each case must be considered on its own circumstances. The failure to call the investigating officer cannot vitiate a conviction where the evidence on record is sufficient to sustain it. 49.In the present case, the material evidence came from the complainant’s directors and employees, the drivers who handled the cement, and the forensic auditor who examined and reconciled the relevant records. The investigating officer would principally have narrated the investigations undertaken and linked the documentary and witness evidence already before the court. The core facts establishing the loss, the ownership of the cement, the respondents’ employment and their respective access to and control over the relevant processes had already been proved through direct evidence. The absence of the investigating officer therefore did not create a material evidential gap. 50.Upon re-valuating the evidence as a whole, I find that the prosecution proved that the respondents were servants of the complainant; that the cement was the complainant’s property and came into the respondents’ possession or control by virtue of their employment; and that the cement was dishonestly appropriated, resulting in substantial loss to the complainant. The evidence was sufficiently cogent to meet the criminal standard of proof. The learned trial court therefore erred in acquitting the 1st and 2nd respondents principally on account of the investigating officer’s failure to testify. The acquittal was consequently not supported by the evidence on record and was not proper. 51.In the premises, the appeal is allowed. Summons shall issue to the 1st and 2nd Respondent for purposes of mitigation and sentencing for the offence they have been convicted of. Orders accordingly JUDGEMENT DATED AND DELIVERED VIRTUALLY THIS 25TH DAY OF AUGUST 2026D. KAVEDZAJUDGE