https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1273

Velos Enterprises Limited v Paragon Electronics Limited & 3 others (Civil Appeal 274 of 2018) [2026] KECA 1273 (KLR) (3 July 2026) (Judgment) Neutral citation: [2026] KECA 1273 (KLR) Republic of Kenya In the Court of Appeal at Nairobi Civil Appeal 274 of 2018 M Ngugi, AO Muchelule & WK Korir, JJA July 3, 2026 Between Velos Enterprises Limited Appellant and Paragon Electronics Limited 1st Respondent Techno Service Limited 2nd Respondent Get Mobile Limited 3rd Respondent Joseph Mwaura Ndegwa (Auctioneer) t/a JK Ndegwa Auctioneers Limited 4th Respondent (An appeal from the ruling and order of the High Court of Kenya at Nairobi (Sergon, J.) dated 11Th May 2018 in HCCC No. 289 of 2015) Judgment 1.This appeal arises from a ruling of the High Court of Kenya at Milimani (Sergon, J.) dated 11th May 2018 in Nairobi HCCC No. 289 of 2015. In the ruling, the court was dealing with an application dated 31st July 2017 in which the appellant, Velos Enterprises Limited (Hereafter ‘the appellant’), sought to set aside an ex parte judgment entered against it and in favour of Paragon Electronics Limited, Techno Service Limited and Get Mobile Limited, the 1st 2nd and 3rd respondents, on 26th October 2015. 2.We note that J. K. Ndegwa Auctioneers Limited, named in this appeal as the 4th respondent and as the 2nd defendant in the plaint before the High Court, did not participate in the proceedings in that court or this Court. Indeed, it does not appear to have been served with summons to enter appearance. Accordingly, for ease of reference, we shall refer to the 1st, 2nd and 3rd respondents as ‘the respondents’. 3.In its ruling, the trial court declined to set aside the ex parte judgment, holding that the firm of Oraro & Co. Advocates, who had entered appearance for the appellant and filed a defence, was not properly on record; that its defence had been filed out of time and without leave; that judgment in damages was properly entered against the appellant; that the amount claimed was a liquidated amount; and that in the circumstances of the case, the appellant should be let to suffer for the mistakes of its advocates. 4.Aggrieved by the decision, the appellant filed the present appeal in which it raises nine (9) grounds of appeal in its memorandum of appeal dated 7th August 2018, which we shall address later in this judgment. It prays that the appeal be allowed with costs against the respondents; that the orders of 11th May 2018 be set aside; and that its application dated 31st July 2017 be allowed with costs. 5.This is a first appeal. We are, accordingly, under a duty to examine the evidence before the trial court, evaluate it and reach our own conclusions- see Selle vs Associated Motor Boat Co. Ltd [1968] EA 123. 6.The record indicates that by a plaint dated and filed on 21st August 2015, the respondents sought, as against the applicant and one Joseph Mwaura Ndegwa t/a S.K. Ndegwa Auctioneers Limited (hereafter ‘the auctioneer’), damages arising from an illegal attachment and conversion of the respondents’ goods which they averred was carried out by the auctioneer on the instructions of the appellant, on or about 8th May 2012. It was their averment further that on or about 8th May 2012, they learnt that their shared business premises at Gateway Business Park along Mombasa Road in Nairobi had been broken into and several goods, valued at Kshs. 27,369,907, removed from the premises. 7.The respondents further averred that they became aware in late 2012 that the break-in and removal of their goods had been undertaken by the auctioneer, on the instructions of the appellant, in purported enforcement of a decree issued on 5th May 2011 in Nairobi HCCC No. 289 of 2009- Velos Enterprises Limited v. Paragon Enterprises as consolidated with HCCC No. 285 of 2010- Paragon Electronics Limited v.Velos Enterprises Limited. 8.The respondents averred that on 3rd April 2012, the auctioneer, in purported execution of warrants of attachment issued on 12th February 2012, which expired on 15th March 2012, purported to undertake a proclamation on the basis of the expired warrants against items in the premises of the 1st respondent, some of which belonged to the 2nd and 3rd respondents; and that during the proclamation, the auctioneer broke into the 1st respondent’s premises and damaged the premises and assets which were valued at Kenya Shillings 17,011, 202.94. They asserted that the auctioneer had advertised the goods for sale on 12th April 2012, and that on 19th April 2012, the auctioneer caused a sham sale of the goods to take place. 9.The respondents alleged that the execution proceedings were fraudulent, based on misinformation and falsehoods, particulars of which they set out in the suit. They prayed for judgment against the appellant and the auctioneer for Kenya Shillings 27,360,907 being the value of the property lost and Kshs. 17,011,202.94 being the value of the damaged goods, interest thereon and costs of the suit. 10.A perusal of the record indicates that summons to enter appearance were served on the appellant on 23rd September 2015, and a memorandum of appearance was filed on its behalf on 28th September 2015 by the firm of Sichangi Partners, Advocates, and served on the firm of Ngatia & Associates, Advocates for the respondents, on the same date. Thereafter, a request for interlocutory judgment dated 13th October 2015 for the sum of Kshs. 44,381,109.94 with interest thereon from the date of filing suit till payment in full was filed by the respondents’ advocates. 11.The record further indicates that on 6th October 2015, the firm of Oraro & Company Advocates filed a memorandum of appearance for the appellant, which was served on the respondents’ advocates, Ngatia & Associates, on 23rd October 2015, together with a defence dated 23rd October 2015 and filed on the same date. 12.In the defence, while denying the respondents’ claim, the appellant averred that any attachment and subsequent sale of the respondents’ goods by auction was pursuant to the summary judgment and decree obtained by the appellant on 5th May 2011 in HCCC No. 289 of 2009-Velos Enterprises Limited v. Paragon Electronics as consolidated with HCCC No. 285 of 2010- Paragon Electronics Limited v. Velos Enterprises Limited. 13.The appellant denied that the warrants of attachment had expired on 15th March 2012, asserting that it was issued on 15th February 2012, was to expire on 15th March 2012 but was extended on two occasions on 18th April 2012 and 19th May 2012. The appellant also denied the allegations of fraud set out in the plaint, and prayed that the suit be dismissed with costs. 14.The next significant development on the record was the filing of garnishee proceedings by the respondents. In the said application, dated 21st July 2017 and filed on behalf of the respondents by the firm of Henia & Anzala Advocates, the respondents sought garnishee orders in respect of the appellant’s accounts held in I & M Bank and KCB Bank to recover Kshs. 55,365,664.73 in execution of a decree issued on 6th June 2017 pursuant to the ex parte judgment entered against the appellant on 26th October 2015. It is this garnishee application that precipitated the filing of the application dated 31st July 2017, brought under Order 10 rule 11 of the Civil Procedure Rules, seeking to set aside the ex parte judgment. 15.In the application, the appellant averred that it had learnt that the ex parte judgment had been entered against it when it was served with the garnishee proceedings on 27th July 2017. It prayed that the ex parte judgment entered against it on 26th October 2015 be set aside, contending that it had, on 23rd October 2015, filed and served a memorandum of appearance and statement of defence on the respondents, but that despite the filing of the defence, the court proceeded to irregularly enter judgment against it; and to award the respondents Kshs. 55,365,664.73 without any formal proof. 16.It prayed that the judgment be set aside to enable it to defend itself in exercise of its right to a fair trial, contending that the amount claimed in the plaint was not a liquidated amount, and that there was a need for formal proof of the claim. Further, that while the suit was filed against it and the auctioneer, there was no evidence of service on the auctioneer, nor was judgment entered against the auctioneer. 17.In the affidavit in support of the application sworn by Rameshchandra Iayantilal Sheth on 31st July 2017 and a supplementary affidavit also sworn by Mr. Sheth on 17th October 2017, the appellant averred that it had initially instructed the firm of Sichangi Partners, Advocates to act for it, but that it later engaged the firm of Oraro & Co. Advocates to represent it, leading to the filing of two memoranda of appearance; that this had led to some inadvertent confusion; that it should not be punished for the failure of its first advocates to file a defence, especially since it had always intended to defend the suit; that there was a defence on the record filed by Oraro & Co. Advocates on 23rd October 2015 which raised triable issues warranting a full hearing; that any mistake of counsel ought not to be visited upon the innocent client; that upon receiving the memorandum of appearance from the firm of Sichangi Partners, Advocates, the respondents should have, at the very least, effected service of the notice of entry of judgment on that firm of Advocates and/or the firm of Oraro & Co. Advocates. The appellant asserted that it had a constitutional right to be heard under Article 50(1) and 159(2)(d) of the Constitution, and the right should not be abridged at the altar of technicality. 18.The respondents opposed the application by an affidavit sworn by Bulent Gulbahar, a director of the 2nd respondent, on 21st September 2017. It was their case that the ex parte judgment had been regularly and properly obtained due to the appellant’s failure to file a valid defence within the stipulated time; that the firm of Sichangi Partners, Advocates, which was the advocate validly on record, did not file any defence by 12th or 13th October 2015, 14 days after entering appearance on 28th September 2015, and therefore, by 14th October 2015 when the request for judgment was filed, the appellant was indeed in default. The respondents contended that the purported defence filed on 23rd October 2015 by Oraro & Co. Advocates was a nullity in law as Oraro & Co. were not properly on record at the time, no notice of change of advocates having been filed. 19.They contended that in any event, even if that defence was to be recognised, it was filed three days out of time, without leave, contrary to Order 7 rule 1 of the Civil Procedure Rules. The respondents contended therefore that the Deputy Registrar properly ignored or overlooked that irregular defence and proceeded to enter judgment on 26th October 2015 since, on the face of the court record, no valid defence had been lodged by the appellant. 20.It was the respondents’ contention further that the default judgment was regular and not impeachable ex debito justitiae as the appellant had been duly served with summons. Further, that a duly served defendant failing to file a defence in time resulted in a regular default judgment which could only be set aside at the court’s discretion, not as of right. 21.Upon considering the application and the respective averments and submissions of the parties, the trial court rendered the ruling the subject of this appeal. 22.At the hearing of the appeal before us, learned counsel, Ms. Mwangi, appeared for the appellant, learned counsel, Mr. Ataka, was present for the respondents, while Mr. Bulent Gulbahar, a director of the 2nd respondent, was present for the 2nd respondent pursuant to a notice to act in person on its behalf. There was no appearance for the 3rd and 4th respondents, nor were there submissions on record for them. 23.Ms. Mwangi highlighted the appellant’s submissions dated 19th February 2021 while Mr. Ataka highlighted submissions dated 4th March 2022, indicated to be filed on behalf of the 1st and 2nd respondents. Mr. Bulent Gulbahar highlighted submissions for the 2nd respondent dated 12th April 2024. 24.In its submissions, the appellant notes that in the request for judgment, the respondents applied for judgment against one of two defendants under Order 10 rule 4 of the Civil Procedure Rules, which was entered on 26th October 2015 as a final judgment against the appellant; that at the time and date when judgment was entered against it, there was on record a duly filed statement of defence; that judgment was entered against it as prayed in the plaint and not an interlocutory judgment as had been prayed for in the Request for Judgment; that the decree was extracted on 6th June 2017 without the involvement of the appellant and/or its Advocates; and that they only learnt of the entry of judgment on 27th July 2017 when they were served with the garnishee application by the I" respondent's then Advocates, Messrs. Henia Anzala Advocates. 25.The appellant submits that it explained in the affidavits sworn by Mr. Rameschandra Sheth the reasons for the delay in filing the statement of defence, attributing it to confusion caused by the appellant instructing two firms of advocates to represent it in the case; and that the firm of Oraro & Company Advocates only learnt that there was a previous law firm on record in August 2017. The appellant submits that despite the confusion, by 23rd October 2015, a statement of defence had been filed and served on the respondents’ Advocates, who accepted service without demur or qualification. 26.The appellant condenses its nine grounds of appeal into three: whether the trial judge erred in failing to set aside the default judgment entered in favour of the respondents; whether the advocates representing the appellant were properly on record and if not, whether such error justified the upholding of the ex parte judgment, taking into account the provisions of Order 10 rules 6 and 11 of the Civil Procedure Rules and Articles 50 and 159(2) (d) of the Constitution. 27.The appellant relies on the case of Kwanza Estates v Dubai Bank (In Liquidation) & Others [2019JeKLR with respect to the exercise of the discretionary power of the trial judge to set aside an interlocutory judgment under Order 10 rule 11; and the circumstances under which this Court will interfere with the exercise of discretion. The appellant also relies on the case of James Kanyiita Nderitu & another vs. Marios Philotas Ghikas & another [2016] eKLR for the proposition that once it comes to the notice of the court that a judgment is irregular, the court does not have to be moved to set it aside; that it can do so suo moto, without venturing into considerations whether the intended defence raises triable issues, or whether there was delay in applying to set it aside. 28.The appellant submits that the ex parte judgment was irregular as the respondents’ advocates were aware that the reliefs sought in the plaint required a hearing, the respondents having requested for interlocutory judgment under Order 10 rule 4 of the Civil Procedure Rules, but that what they obtained from the Court was a decree for the sums prayed in the plaint. 29.The appellant further submits that the respondents had instituted their suit against two defendants (the appellant and the auctioneer), claiming damages caused by the auctioneer during a proclamation in respect of the enforcement of a summary judgment obtained in HCCC 289 of 2009 and 285 of 2010. 30.It submits that there has been no pleading that the damages, which remained unproven, arose out of the breach of any written agreement between the parties providing for the calculation of these damages; and that the respondents’ claim was not a claim for a liquidated amount; as defined in Black's Law Dictionary and the Supreme Court Practice 1988 Edition Volume 1 [6/2/4] which defines a liquidated demand as being in the nature of a debt, a specific sum of money due and payable under or by virtue· of a contract. The appellant asserts that the amounts were at best a claim for pecuniary damages to be assessed by the Court once the respondents had led evidence at formal proof. 31.The appellant submits that the only applicable provision in entering ex parte judgment for the respondents was Order 10 rule 6 of the Civil Procedure Rules which provides for entry of interlocutory judgment after which the matter would be set down for assessment of the damages on formal proof, citing in support the case of Kenya Commercial Bank Ltd v Joshua Aggrey Oburi [200l] eKLR; that a claim for special damages must be pleaded and proved, reliance being placed on the decision in Provincial Insurance Co. East Africa v Nandwa [1995-98) 2 E.A. 288 and Waweru v Ndiga (1982-88) 1 KAR 210; and that the amounts pleaded in this case ought to have been strictly proved at formal proof, and final judgment should not have been entered without it. 32.The appellant submits further that the trial judge erred and wrongly exercised his discretion in dismissing its application as Order 10 rule 11 gives the court discretion to set aside any judgment entered under the provisions of Order 10; that the appellant had sought the court’s exercise of discretion to set aside the ex parte judgment; and that as was held in Waweru v Ndiga (supra), the court has an unfettered discretion to do justice to the parties. 33.Further, that as was held in Geeta Bharat Shah v Omar Said Mwatayri [2009) eKLR, even where the summons was properly served and therefore the ex parte judgment is regular, the court, in the exercise of its discretion, is required to consider the draft defence and if, having considered it, comes to the conclusion that it raises matters that require the court's investigation or raises triable issues, it is required to exercise its discretion in favour of the applicant. The appellant submits that in this case, the defence raised, among others, the issue of the claims being res judicata given the existence and judgment in HCCC No. 289 of 2009. 34.The appellant impugns, finally, the holding by the trial court that it should be allowed to suffer for the mistakes of its counsel. It submits that given the confusion and the resultant delay in filing the statement of defence caused by the appellant and its two advocates, the innocent mistake ought not to be visited on the appellant. It relies in support on the case of Pithon W. Maina v Thuka Mugiria (1982-88) 1 KAR 171 in which it was held that in the circumstances of the case, the appellant should not have been denied a hearing because of his advocate's mistake, even if it amounted to negligence. 35.The 1st respondent’s submissions, highlighted by learned counsel, Mr. Ataka, were that the firm of Oraro & Co Advocates came on record for the appellants on 6th February 2018 in place of the firm of Sichangi Partners, Advocates, 7 months after filing the application dated 31st July 2017 and three months before the ruling of 11th May 2018. This, according to the 1st respondent, amounted to their own implicit admission that at the time they filed the application dated 31st July 2017, they were not properly on record; nor were they on record when they purportedly filed the statement of defence on 23rd October 2015. Further, that they only filed the Notice of Change of Advocates upon service with the 1st respondent’s replying affidavit in opposition to the application dated 31st July 2017 which pointed out the irregularity. It submits that the trial court was therefore right in striking out all the pleadings filed by the said firm before it properly came on record in the matter, support for this submission being sought in the case of Jasso Chucha Huka (Branch Secretary, Isiolo Branch Kanu) & 2 others v Sadia Halake Galgalo & 4 others [2021] eKLR. 36.The 1st respondent submits, secondly, that there was no valid statement of defence on record on 26th October 2015. It submits that for the court to determine whether or not it would allow the application to set aside the ex parte judgment, it would have had to consider whether there were triable issues raised in the statement of defence. Since there was no valid statement of defence on record, there was nothing for the court to consider. 37.The 1st respondent asks this Court to be guided by the decision in Adblu East Africa Limited & 2 others v Jean Farhat & 2 others [2020] eKLR in which similar circumstances existed; and Regina Kavenya Mutuku & 3 others v United Insurance Co Ltd [2002] eKLR to submit that since the appellant did not have a valid defence on record, it was not necessary for the High Court to enter into any further consideration of whether or not any of the matters raised in the invalid defence raised any bona fide triable issues. 38.The 1st respondent further submits that the appellant did not seek leave to file its defence out of time; that it filed the defective memorandum of appearance on 6th October 2015; should have filed its defence on 20th October 2015 but filed it on 23rd October 2015 and therefore the defence was filed out of time; and that Order 7 rule 1 of the Civil Procedure Rules required that leave be sought to file the statement of defence out of time, but it was not. 39.The 1st respondent argues that while the court has jurisdiction to entertain and allow applications to set aside judgments in appropriate cases, where there is no application or prayer for leave to file a defence out of time and for the suit to be heard on merit, the purpose of granting the prayer to set aside judgement is in vain, support for this submission being sought in Seline Akoth Oyiengo v George Ochieng Owino & another [2019] eKLR. 40.It is the 1st respondent’s submission further that the request for judgment dated 13th October 2015, lodged under Order 10, rules 4 and 10 of the Civil Procedure Rules, was properly granted on 26th October 2015 against the appellant which had failed to file a defence within the prescribed period despite being served and entering appearance on 28th September 2015. It contends that the Deputy Registrar properly entered default judgment as the appellant failed to file its defence within the prescribed time, citing in support the definition of a ‘regular default judgment’ in the case of James Kanyiita Nderitu & another v Marios Philotas Ghikas & another [2016] eKLR. 41.While conceding that the court has the discretion to set aside even a regular ex parte judgment, the 1st respondent submits that the court was not entitled to do so in exercise of its discretion unless the applicant provides an explanation for the failure to file his memorandum of appearance or defence. It maintains that in this case, the appellant did not provide any explanation why its former advocates, Sichangi Partners, Advocates, did not file a defence after entering appearance within time. 42.It is the 1st respondent’s submission, further, that the Deputy Registrar was entitled to enter judgment as the prayers in the plaint were liquidated and amounted to ascertainable demands, citing in support the case of Gurbaksh Singh & Sons Limited-v- Njiri Emporium Ltd [1985] eKLR for the definition of liquidated damages. The 1st respondent contends that the appellant had not placed before us grounds for interference with the exercise of discretion by the trial court; that setting aside an ex parte judgment is discretionary, and this Court is enjoined not to interfere with the exercise of discretion except in very limited and clear circumstances where it is demonstrated that the trial court misdirected itself, considered matters it should not have considered, or failed to consider matters which it should have considered, and in so doing arrived at the wrong decision, support for this submission being sought in the case of Tobias M. Wafubwa v Ben Butali [2017] eKLR. 43.The 1st respondent discounts the appellant’s argument that the mistakes of its counsel should not be visited upon it, contending that the act of a client instructing two advocates cannot be described as ‘mistake of counsel’; that it has not been explained how appointment of two law firms could have caused confusion, and nor was the ‘confusion’ explained in the application dated 31st July 2017. It is its submission that no explanation has been offered for the inordinate delay in filing the defence by Oraro & Co. Advocates, reliance being sought in the case of Omwoyo -v-African Highlands & Produce Co. Ltd [2002]1 KLR to submit that an innocent party should not be made to shoulder the consequences of the negligence of the appellant’s advocates; and that the appellant’s remedy lies in a claim in professional negligence against the advocates. It prays that the appeal be dismissed with costs. 44.In his submissions, Mr. Gulbahar emphasized the failure of the appellant’s advocates to file their defence on time, contending that there was no evidence that the defence was filed as there is no receipt in the record of appeal. Further, and somewhat contradicting the prior argument, that the defence was filed on 23rd October 2015 and it was therefore filed out of time, the firm of Oraro & Co. Advocates not having sought leave to file it out of time. 45.In urging this Court to dismiss the appeal, Mr. Gulbahar echoed the submissions made on behalf of the 1st respondent, maintaining that there was no defence on record and therefore there would be no point in sending the matter back to the High Court as the situation would be the same as it was at the time of the ruling of the High Court. 46.We have considered the record of appeal and the submissions of the parties. The overarching issue for determination is whether the trial court properly exercised its discretion in declining to set aside the ex parte judgment entered on 26th October 2015 in favour of the respondents. In addressing our minds to this core issue, we will need to consider four subsidiary issues, viz:i.Whether the firm of Oraro & Company Advocates was properly on record for the appellant;ii.Whether the appellant’s statement of defence was properly on record and ought to have been considered by the court;iii.Whether the ex parte judgment entered on 26th October 2015 was regular in the circumstances of this case;iv.Whether the respondents’ claim was for liquidated damages not requiring formal proof. 47.At the hearing of the appeal, Ms. Mwangi tacitly conceded, and the record bears this out, that the representation of the appellant at the inception of the suit was wanting. The appellant first instructed the firm of Sichangi Partners, Advocates, which filed a memorandum of appearance on 28th September 2015. The appellant then instructed the firm of Oraro & Co Advocates, which filed another memorandum of appearance on its behalf on 6th October 2015. 48.Thereafter, on 23rd October 2015, the second law firm filed a statement of defence dated 23rd October 2015, which was served on the Advocates then on record for the respondents, Ngatia & Associates, on the same date. It is not disputed that under Order 7 rule 1 of the Civil Procedure Rules, a defendant must file a defence within 14 days after entering appearance, so in this case, the defence ought to have been filed by 20th October 2015, which is a public holiday in Kenya, so the last date for filing the defence was 21st October 2015. There was therefore a delay of two days. 49.The respondents have strenuously argued that the firm of Oraro & Co. Advocates was not properly on record, and therefore the defence that it filed was not properly on record. They were therefore, they contend, entitled to the ex parte judgment which was entered for them on 26th October 2015. It is undisputed that the firm of Oraro & Co. did not file a Notice of Change of Advocates or a Notice of Appointment as required by law to formally place itself on record in place of Sichangi Partners, Advocates, as required under Order 9 rule 5 of the Civil Procedure Rules. It eventually filed a notice of change of advocates on 6th February 2018. 50.It would appear that in filing the memorandum of appeal and the statement of defence, Oraro & Co. Advocates operated on the mistaken assumption that the appellant had instructed them to take up the matter from inception, the appellant not having informed its new firm of advocates that it had previously given instructions to another law firm. Looked at from this perspective, and having been filed prior to the entry of judgment and therefore the requirements of Order 9 rule 9 of the Civil Procedure Rules did not apply, the confusion alluded to by the appellant may find a sympathetic ear in the Court. 51.We say so having noted the antics of the respondents with their own advocates after the entry of judgment in their favour, which meant that in the case of the respondents’ advocates, Order 9 rule 9 was applicable. In its written submissions, the appellant drew attention to the fact, and our own perusal of the record confirms this, that post the judgment of 26th October 2015, there were at least three changes of advocates for the respondents, without compliance with the said Order 9 rule 9. There was a notice of change of advocates dated 21st July 2017 from Ngatia & Associates to Henia Anzala Advocates, just before this latter firm filed the application for garnishee orders. Then there is a notice of change of advocates dated 6th December 2017 from Henia Anzala Advocates back to Ngatia & Associates; and there appears to have been yet another change of advocates to the current firm, AKO Advocates. 52.That being the case, it seems to us that the respondents cannot afford to throw stones at the appellant with respect to the procedural propriety of the changes in representation. A perusal of the record does not reveal any application for leave to come on record by any of the respondents’ advocates post judgment under Order 9 rule 9; nor could we find any consent to the change of representation. It would appear, therefore, that the application for the decree on 6th June 2017 and the application for a garnishee order were made by counsel who were not properly on record. 53.It seems to us, then, that in this case, in a situation where all parties were non-compliant, the court was under a duty to consider the defence on record, despite the circumstances under which it was filed. As has been held by our courts in several decisions, even where there is a regular judgment in default but a draft defence has been annexed on an application to set aside the judgment, the court should consider it to see if it raises any triable issues- see Tree Shade Motors Limited v D.T. Dobie and Company (K) Limited & Another [1998] KECA 40 (KLR) and CMC Holding Limited v Nzioki [2004] KECA 143 (KLR). 54.In this case, there was a defence on record, albeit filed two days late by a firm of advocates that assumed, incorrectly as it turned out, that it was properly on record. Bearing in mind the duty of the court to render substantive justice, we take the view that the trial court should have considered the defence on record before striking out and dismissing the application to set aside the judgment. 55.Which brings us to a consideration of the validity of the judgment entered in favour of the respondents. The respondents have asserted that the judgment in their favour was proper and regular as they had prayed for a liquidated amount in the plaint. Two questions arise with regard to the impugned ex parte judgment. The first is whether it was a regular or irregular default judgment. In its decision in James Kanyiita Nderitu (supra) this Court drew the distinction between the two in the following terms:“We shall first address the ground of appeal that faults the learned judge for setting aside the default judgment and consequential orders in the circumstances of the case. From the outset, it cannot be gainsaid that a distinction has always existed between a default judgment that is regularly entered and one which is irregularly entered. In a regular default judgment, the defendant will have been duly served with summons to enter appearance, but for one reason or another, he had failed to enter appearance or to file defence, resulting in default judgment. Such a defendant is entitled, under Order 10 rule 11 of the Civil Procedure Rules, to move the court to set aside the default judgment and to grant him leave to defend the suit. In such a scenario, the court has unfettered discretion in determining whether or not to set aside the default judgment, and will take into account such factors as the reason for the failure of the defendant to file his memorandum of appearance or defence, as the case may be; the length of time that has elapsed since the default judgment was entered; whether the intended defence raises triable issues; the respective prejudice each party is likely to suffer; whether on the whole it is in the interest of justice to set aside the default judgment…” 56.With regard to an irregular default judgment, the Court stated:“In an irregular default judgment, on the other hand, judgment will have been entered against a defendant who has not been served or properly served with summons to enter appearance. In such a situation, the default judgment is set aside ex debito justitiae, as a matter of right. The court does not even have to be moved by a party once it comes to its notice that the judgment is irregular; it can set aside the default judgment on its own motion. In addition, the court will not venture into considerations of whether the intended defence raises triable issue or whether there has been inordinate delay in applying to set aside the irregular judgment. The reason why such judgment is set aside as of right, and not as a matter of discretion, is because the party against whom it is entered has been condemned without notice of the allegations against him or an opportunity to be heard in response to those allegations. The right to be heard before an adverse decision is taken against a person is fundamental and permeates our entire justice system. (See Onyango Oloo v. Attorney General [1986-1989] EA 456). 57.In this case, the appellant had been served, and had entered appearance, twice. It had also filed a defence on 23rd October 2015, two days later than it should have, under the Civil Procedure Rules. The ex parte judgment was, therefore, a regular judgment as defined in James Kanyiita Nderitu. In a situation where parties are less disposed to grind their opponents into the dust, as we occasionally see in disputes before us, this is a matter where the ex parte judgment could have been set aside by consent, and the issues between the parties heard on merit. This was not done, however, which leads us to where we now are. So, the short answer is that the ex parte judgment was a regular default judgment, one which could be set aside at the discretion of the court as provided under Order 10 rule 11 of the Civil Procedure Rules. 58.Before circling back to the core issue identified at the beginning of this analysis- whether the trial court erred in the exercise of its discretion in dealing with the application dated 31st July 2017, we turn to address the question whether the ex parte judgment was for a liquidated amount, as the trial court found, and therefore there was no need for formal proof. In determining that the amount for which judgment was entered was a liquidated amount, the trial judge observed as follows:“The 1st defendant has complained that since the claim was for loss and or damages, there was need for the court to assess damages.10)With respect, I do not agree with that submission. The plaint is specific on what the plaintiff sought. The plaintiff asked to be paid Ksh.27,309,907 for the goods carted away and Ksh.17,011,202/94 representing the value of damages for the property destroyed. The aforesaid sums represented a liquidated claim pursuant to the provisions of Order 10 rule 4 of the Civil Procedure Rules. In the circumstance therefore, there was no need to undertake an-assessment to ascertain the claim.” 59.The question is what amounts to a liquidated claim. In its decision in Postal Corporation of Kenya & another v Aineah Likumba Asienya & 11 others [2018] KECA 326 (KLR), this Court accepted the definition of liquidated damages as set out in the decision of Ochieng J. (as he then was) in Cimbria East Africa Limited v Kenya Power & Lighting Co. Limited [2017] eKLR in which the learned Judge stated:“A claim does not become a liquidated demand simply because it has been quantified. To qualify as liquidated demand, the amount must be shown to be either already ascertained or capable of being ascertained as a mere matter of arithmetic. I adopt the following definition of a debt or liquidated demand from THE SUPREME COURT PRACTICE (1985) VOLUME 1, at page 33;A liquidated demand is in the nature of debt,i.e a specific sum of money due and payable under or by virtue of a contract. Its amount must either be already ascertained or capable of being ascertained as a mere matter of arithmetic. If the ascertainment of a sum of money, even though it be specified or named as a definite figure, requires investigation beyond mere calculation, then the sum is not a debt or liquidated demand but constitutes damages.”See also Gurbaksh Singh & Sons Ltd v Njiri Emporium Ltd [1985] KECA 81 (KLR), 60.In order to qualify as a liquidated amount, the exact amount of money owed has to be an amount that is ascertained or determined in the manner described in Cimbria East Africa Limited v Kenya Power & Lighting Co. Limited. In this case, the respondents’ plaint at paragraph 4 et seq states that:4.The Plaintiffs' claim against the Defendants jointly and severally is in damages arising from an illegal attachment and conversion of the Plaintiffs' goods which was carried out on or about 8th May 2012.5.On or about 8th May 2012, the Plaintiffs learnt that their shared business premises at Block C Gateway Business Park along Mombasa Road in Nairobi had been broken into….Several goods belonging to the Plaintiffs. valued at Kshs. 27, 369, 907.00/= had been removed from the premises.6.On 3rd April 2012 the 2nd Defendant purported to undertake a proclamation on the basis of the expired warrants on items and assets obtained from the Plaintiffs’ premises several of which items belonged to the 2nd and 3rd Plaintiffs and not the 1st Plaintiff's.7.During the proclamation the 2nd Defendant by himself and or by persons working for him and or on his instructions violently broke into the premises and in their trail vandalized and damaged the Plaintiffs' premises and fixed assets within the premises causing the Plaintiffs loss worth Kshs 17,011,202.94/=. 61.The respondents’ pleadings, in our view, do not disclose specific, determined, or ascertained amounts. The respondents’ claim was that their properties had been carted away and their premises damaged; and they had placed values on the goods carted away and damaged properties of Kshs.27,369,907.00 and Kshs. 17,011,202.94 respectively. As submitted by counsel for the 1st respondent, their claim could be ascertained. True. But it must be understood that ascertaining the claim required that the respondents adduce evidence in support of their claim by way of formal proof, which was not done. 62.Accordingly, we find that in the circumstances of this case, the trial court was in error in finding that formal proof was not required. We take the view that the trial court did not exercise its discretion properly in failing to consider the defence that was on record and in declining to set aside the ex parte judgment and allowing the appellant to defend the claim. 63.In the result, we allow the appellant’s appeal, set aside the ruling of the High Court dated 11th May 2018, and allow the appellant’s application dated 31st July 2017. Given the comedy of errors engaged in by all the parties to this appeal with respect to representation, we direct that each party bears its own costs of the appeal. DATED AND DELIVERED AT NAIROBI THIS 3RD DAY OF JULY, 2026.MUMBI NGUGI………………………………JUDGE OF APPEALAGGREY MUCHELULE………………………………JUDGE OF APPEALW. K. KORIR………………………………JUDGE OF APPEALI certify that this is a true copy of the original.SignedDEPUTY REGISTRAR