https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/9316

Ojwaya v South Nyanza Sugar Co Ltd (Civil Appeal E071 of 2022) [2026] KEHC 9316 (KLR) (25 June 2026) (Judgment) Neutral citation: [2026] KEHC 9316 (KLR) Republic of Kenya In the High Court at Migori Civil Appeal E071 of 2022 WN Molonko, J June 25, 2026 Between Ronald O. Ojwaya Appellant and South Nyanza Sugar Co Ltd Respondent (Being an appeal from the Judgment and Decree of Hon. Kamau C.M Resident Magistrate, Rongo, dated 11th December 2019 in PMCC No. 197 of 2016) Judgment Background 1.This is an appeal against the judgment of Hon. Kamau C.M Senior Resident Magistrate, Rongo delivered on 11th December, 2019 in PMCC No. 197 of 2016 involving a sugar cane farmer and a sugar miller in respect of an alleged contract of cane growing and harvesting. 2.In that case, the Appellant claims that he entered into a contract with the Respondent on 15/01/07, which contract would remain in force for a period of 5 years or until one plant crop and two ratoon crops of sugarcane were harvested whichever period was less. 3.In its statement of defence, the Respondent denied the existence of an agreement between the Appellant and the Respondent and denied that it owed the Appellant for the loss of crop on 0.6 (Ha) of land at the rate of 135 tons per hectare and the payment of Kshs.2,500/- per ton for the expected mature cane or that it breached any such contract. 4.In the alternative, the Respondent claimed that it was not bound to purchase the sugarcane from the Appellant as alleged. Rather, it was only bound to harvest sugarcane from plots that had been well maintained and from which satisfactory sugarcane yield could be reasonably expected to be achieved. 5.The Respondent further averred that the Appellant failed to employ the recommended crop husbandry to the extent that the cane was overshadowed and dwarfed by weeds and totally destroyed and the Respondent could not be contractually bound to harvest. 6.The matter was dismissed by the trial court. The Appellant being aggrieved by the judgment, appeals to this court on the following grounds-(i)That the learned trial magistrate erred in law and in fact in disregarding the evidence led by the Appellant which showed that he had a contract with the Respondent, which contract was in fact performed.(ii)The learned trial magistrate erred in law in not finding that D.W.1. the defence witness was not a witness of fact and truth and thereby erred and misdirected himself the balance of possibility principle.(iii)The learned trial magistrate erred in failing to find for the Appellant that on the preponderance of evidence, there was proved to exist a contract between the appellant and the Respondent, which contract the Respondent had resiled from and breached.(iv)The learned trial magistrate erred in law in failing to make an award in damages in favour of the appellant. 7.The Appellant seeks the following orders-(a)The appeal be allowed and the judgment and decree of the trial court be set aside;(b)Damages for breach of contract;(c)Interest; and(d)Costs of the appeal and of the suit at the trial court. 8.Directions were subsequently taken that the appeal be canvassed by way of written submissions. Only the Appellant filed his written submissions while the Respondent failed to do so despite being served with the notice of the hearing. 9.This being the first appeal, it is well settled that the role of this Court is to revisit the evidence on record, evaluate it and reach its own conclusion in the matter. (See the case of Selle & Ano. vs. Associated Motor Boat Co. Ltd (1968) EA 123). This court nevertheless appreciates that an appellate Court will not ordinarily interfere with findings of fact by the trial Court unless they were based on no evidence at all, or on a misapprehension of it or the Court is shown demonstrably to have acted on wrong principles in reaching the findings. This was the holding in Mwanasokoni – versus- Kenya Bus Service Ltd. (1982-88) 1 KAR 278 and Kiruga –versus- Kiruga & Another (1988) KLR 348). 10.At the hearing, PW 1, Ronald Ojwaya, testified that he entered into a contract with the Respondent for the development of sugarcane. Pursuant to the contract, he was supplied with farm inputs while the Respondent was responsible for harvesting the cane. He testified that he performed his obligations under the contract and that the plant crop was harvested by the Respondent. Thereafter, he prepared and developed the first ratoon crop on his 0.6-hectare farm. However, the first ratoon crop was not harvested by the Respondent and consequently dried up in the field and went to waste. 11.He further testified that he did not develop the second ratoon crop because the crop had already been compromised by the failure to harvest the first ratoon. As a result, he suffered loss and prayed for compensation and costs of the suit. He produced a Demand Letter as PEXB 1, Cane Productivity Sub-Location Wise as PEXB 2, and Debit Advice documents as PEXB 3A and PEXB 3B. Consequently, he sought compensation for the 1st and 2nd ratoon crops totaling to Kshs.405,000/- calculated as per the expected yield. 12.During cross-examination, PW1 acknowledged that the contract booklet had not been attached to the pleadings because it was lost. He further confirmed that he did not develop the second ratoon crop since the first ratoon crop was not harvested. 13.DW1, Richard Muok, testified on oath that he was a Senior Field Supervisor employed by the Respondent. He departed from his witness statement dated 18th February 2017 and instead relied on his oral testimony. He testified that there was no contract executed between the parties as alleged. According to him, a genuine contract must be signed by two representatives of the defendant and the farmer, and no such document had been produced before the court. He further stated that the Defendant now Respondent had no such contract in its records. He maintained that the Plaintiff now Appellant was a stranger to the Defendant now Respondent. 14.On cross-examination, DW1 confirmed that the Plaintiff’s/Appellant’s list of documents did not contain a contract and reiterated that no contract existed between the parties. He acknowledged that the witness statement he had disowned contained an admission that a contract existed. He further stated that no account number or acreage was admitted therein, although the cane price was indicated. Appellant’s Submissions 15.The Appellant’s submissions focused on two issues; whether there was a contract between the Appellant and the Respondent despite the loss of the contract book; and whether there was a breach of the contract. 16.On the issue of whether a contract existed despite the loss of the contract book, the Appellant submitted that the existence of a contract was established by the conduct of the parties and the evidence produced before the court. He argued that the denial by DW1 only affected the witness’s credibility because the parties had acted in a manner consistent with a contractual relationship. He relied on Caleb Onyango Adongo V Benard Ouma Ogar (2020) eKLR, Civil Appeal 14 of 2019, where the Court cited the case of Abdulkadir Shariff Abdirahim & Another Vs Shariff Mohamed t/a A.S Mohamed Investments (2014) eKLR where the Court stated:-“21. there is no general rule of law that all agreements must be in writing. The numerous advantages of a written agreement notwithstanding, all that the law requires is that certain specific agreements must be in writing...section 3(1) of the Law of Contract Act is one such provision.” 17.The Appellant submitted that not all agreements are required to be in writing and that once the essential contractual requirements are established, an enforceable contract exists. He maintained that the loss of the contract document did not negate the existence of a valid contract and that the evidence and documents produced in support of his claim were not disputed by the Respondent. According to the Appellant, there was an offer, acceptance, consideration and a meeting of the minds between the parties, as demonstrated by their conduct. 18.On proof of existence of a contract, he cited the case of Ali Abdi Mohamed V Kenya Shell Company Limited [2017] eKLR, where the Court made reference to the case of William Muthee Muthami V Bank of Baroda [2014] eKLR, where it stated:-“in the law of contract, the aggrieved party to an agreement must, in addition, prove that there was offer, acceptance and consideration. It is only when those three elements are available that an innocent party can bring a claim against the party in breach” 19.On inference of a contract by conduct, the Appellant relied on Ali Mohamed v Kenya Shell & Company Limited where the court stated:-“ 11.It therefore follows that a contract can exist where no words have been used but where it can be inferred from the conduct of parties that a contract has been concluded. See Timoney and King V King 1920 AD 133 at 141. In the circumstances of the instant case, there existed an enforceable contract between the parties by reason of conduct. Indeed, it was not disputed by the Respondent that it supplied petroleum products to the appellant at a specific amount per litre and for a certain period of time” 20.The Appellant further submitted that a contract exists where the essential elements of offer, acceptance and consideration are present. He argued that there was an offer when the Respondent contracted him on 15 January 2007 to grow sugarcane on his parcel of land and thereafter sell it to the Respondent. He submitted that there was acceptance when he planted and developed sugarcane on Plot Number 265E in Field Number 102 situated in Kanyamkago Kajulu Sub-location in accordance with the terms of the agreement. He further submitted that consideration was demonstrated by the Respondent’s payment to him after harvesting the plant crop, as evidenced by South Nyanza Sugar Company Limited Debit Advice to Outgrowers Numbers 249653 and 245521. 21.The Appellant also relied on the conduct of the parties to demonstrate the existence of the contract. He submitted that the Respondent contracted him to grow and sell sugarcane to it, supplied seed cane and fertilizer, undertook ploughing, harrowing and furrowing of the land, and harvested the plant crop upon maturity. He argued that these actions constituted clear evidence of an existing contractual relationship. 22.On whether there was a breach of contract, the Appellant submitted that the Respondent failed to harvest the ratoon crops after maturity and thereby breached the terms of the agreement. He cited South Nyanza Sugar Co. Ltd V John Chora Omolo HCCA NO. 123 of 2018 (Kisii) where the court adopted the statement laid out in Martin Akama Lango V South Nyanza Sugar Co. Ltd, HCCA NO. 20 OF 2000, where the court held:-“when the Respondent failed to do the harvesting and waited until the crop was burnt by arsonists, it was in breach of the terms of the agreement and had the trial magistrate correctly interpreted the provisions of the said agreement, she should have held that the Respondent was in breach of the contract and liable to pay damages” 23.The Appellant submitted that the trial magistrate erred both in the procedure followed and, in the decision reached. He urged the appellate court to find that there existed a valid and enforceable contract between the parties which was breached by the Respondent through its failure to harvest the ratoon crops. 24.There was no submission made by the Respondent as stated above. Determination 25.This Court has carefully considered the pleadings, judgment of the trial court, grounds of appeal, submissions and the authorities referred to by the Appellant and reaches the following determination. 26.On the question whether there was a binding contract between the parties, the Appellant faulted the trial court for holding that there was no contract between the parties yet there was evidence that the contract was indeed substantially performed. In the absence of the contract book, was there a valid contract upon which the Appellant could mount a claim for breach of contract? 27.Harris JA in Garvey v Richards [2011] JMCA 16, in considering the essential components of a contract, held thus:-“It is well settled rule that an agreement is not binding as a contract unless it shows an intention by the parties to create a legal relationship. Generally, three basic rules underpin the formation of a contract, namely, an agreement, an intention to enter into contractual relationships and consideration. For a contract to be valid and enforceable, essential terms governing the relationship of the parties must be incorporated therein. The subject matter must be certain. There must be positive evidence that a contractual obligation, born out of an oral or written agreement is in existence.” 28.In Ali Abdi Mohamed v Kenya Shell & Co Ltd (supra), the court stated that a contract can be inferred from the conduct of the parties even in the absence of a formal document. 29.Further in Brodgden v Metropolitan Railway Co. (1877)2App Cas 666, the House of Lords held that a contract may be implied from the conduct of the parties even where a formal agreement was not concluded, so long as both parties acted in a manner that indicted mutual assent. 30.Similarly, in Kenya Ports Authority v Modern Handling (EA) Limited [2017], the court stated that -“Where a contract is inferred from the conduct of the parties, it is sufficient to show that both parties acted in such a way that would lead a reasonable person to conclude that a contract existed between them.” 31.From the record, this court notes the documents relied on by the Appellant including the Debit Advises to the Outgrowers by the Respondent, the Respondent ploughed the land and supplied fertilizer and cane for planting. These documents were produced in evidence before the trial court without objection by the Respondent. Although the Respondent attempted to deny the existence of such documents and that the said documents did not emanate from it, such attempt came late in the day. In any event, section 62 of the Evidence Act prohibits adduction of oral evidence to disprove documentary evidence. On a balance of probabilities, the documents infer part performance of the contract by the Respondent hence the existence of a contractual relationship. 32.On the issue of breach of contract, the Appellant submitted that he performed his obligations under the contract and that the plant crop was harvested by the Respondent. Thereafter, he prepared and developed the first ratoon crop on his 0.6-hectare farm. However, the first ratoon crop was not harvested by the Respondent and consequently dried up in the field and went to waste. On re-evaluation of the evidence adduced by the appellant before the trial court, it was clear that the Respondent was under contractual obligation to harvest the first and the second ratoon crops. The Respondent’s failure to harvest the first ratoon meant that apart from suffering loss of income from the said harvest, he also suffered loss from the expected harvest of the second ratoon crop which never reached maturity. From the foregoing analysis, it is evident that the trial court erred in dismissing the appellant’s suit. The appeal is allowed. 33.The trial court’s judgment is hereby set aside and substituted by a judgment allowing the appellant’s suit with costs. 34.For avoidance of doubt, the appellant is awarded damages of the Kshs.405,000/= being the losses he suffered as a result of the Respondent’s failure to harvest the two ratoon crops as it was required to under the contract it entered with the Appellant. 35.The above amount shall be paid plus interest from the date the suit was filed. DATED, SIGNED AND DELIVERED VIRTUALLY at NAIROBI ON this 25TH day of JUNE, 2026W.N. MOLONKOJUDGEJudgment delivered virtually in the presence of:Respondent- AbsentMs. Theuri h/b for Mr. Oduk for the Appellant.Susan Nzioka – Court Assistant