https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/816

**REPUBLIC OF KENYA** **IN THE CHIEF MAGISTRATES COURT OF KENYA AT MOMBASA** **MAGISTRATE COURT CIVIL** **CIVIL CASE NO. E1154 OF 2023** **ZAINABU WAITHERA NJEHIA....................................................................PLAINTIFF** **VERSUS** **ROYAL AUTOWORLD INTERNATIONAL LIMITED............................1ST DEFENDANT** **MOSES MBUGUA MUNGAI..............................................................2ND DEFENDANT** **JUDGMENT** **Introduction** 1. The Plaintiff instituted these proceedings arising from the sale and subsequent disposal of motor vehicle registration number KDH 880T, Toyota Auris. By her Amended Plaint amended on 4th December 2024, she seeks, jointly and severally against the Defendants, refund of KShs.1,350,000, general damages for fraud, mental anguish and damage suffered, costs and interest. She pleads that the Defendants conspired to dispose of the vehicle through a forged affidavit and fraudulent email and that the 2nd Defendant retained the proceeds of sale. 2. The Defendants deny fraud. Their common position is that the Plaintiff authorised the 2nd Defendant to sell the vehicle after she failed to clear an outstanding balance of KShs.450,000 owed to the 1st Defendant. The 2nd Defendant additionally admits that he sold the vehicle for KShs.1,200,000, received the purchase price into his bank account and thereafter dealt with the proceeds in the manner set out in his defence. 3. I have considered the pleadings, witness statements, oral evidence as reflected in the parties' submissions, documentary exhibits and the respective written submissions. **Plaintiff's case** 1. It is substantially common ground that on 25th October 2022, the Plaintiff entered into a sale agreement with the 1st Defendant for the purchase of KDH 880T for KShs.1,800,000. 2. The agreed consideration was partly satisfied by the Plaintiff trading in her Toyota Ractis registration number KCX 431T, valued at KShs.750,000, and paying a further KShs.600,000 in cash. Her total contribution was therefore KShs.1,350,000, leaving KShs.450,000 payable by 6th November 2022. 3. The Plaintiff did not clear the KShs.450,000 by the agreed date. KDH 880T remained in the custody of the 1st Defendant pending completion of the purchase price. 4. Her case, however, is that neither the agreement nor any subsequent authority permitted the Defendants to sell the vehicle. She pleaded that the 1st and 2nd Defendants conspired to dispose of it using an affidavit falsely attributed to her and a fraudulent email. She further alleged that the 2nd Defendant hacked her email, impersonated her and, after paying KShs.450,000 to the 1st Defendant, retained KShs.750,000 from the proceeds. She consequently pleaded financial loss of KShs.1,350,000, loss of user, mental anguish and anxiety. **The 1st Defendant's case** 1. The 1st Defendant does not dispute the original transaction or the amount paid by the Plaintiff. Its case is that after the Plaintiff defaulted on the KShs.450,000 balance, there were communications between the parties concerning payment. It says that the Plaintiff ultimately informed it that the vehicle would be sold and the outstanding balance paid from the proceeds. 2. The 1st Defendant relied upon WhatsApp communications, an email allegedly originating from the Plaintiff's email address and two affidavits dated 12th November 2022. One affidavit purportedly emanated from the Plaintiff and authorised the 2nd Defendant to sell KDH 880T and use part of the proceeds to clear the KShs.450,000 balance. The disputed affidavit expressly contains such authority. 3. The 1st Defendant's position is that it did not procure the purchaser and did not receive the KShs.1.2 million sale proceeds. Its interest was confined to the outstanding KShs.450,000, which it subsequently received. **The 2nd Defendant's case** 1. The 2nd Defendant admits that he and the Plaintiff had previously been in a romantic relationship and had lived together. He admits the material terms of the transaction between the Plaintiff and the 1st Defendant. 2. More importantly, the 2nd Defendant admits that he personally procured a purchaser for KDH 880T and sold it to Daniel Ikiara Kamau for KShs.1,200,000. He further admits that the entire KShs.1.2 million was deposited into his DTB Bank Account No. 095000050293. 3. His account of the KShs.1.2 million is as follows: Application Amount Paid to the 1st Defendant KShs.450,000 Alleged brokerage KShs.100,000 Paid to Plaintiff on 25th November 2022 KShs.300,000 Paid to Plaintiff on 5th January 2023 KShs.100,000 Retained against alleged debt KShs.250,000 Total KShs.1,200,000 1. The 2nd Defendant says that the KShs.250,000 was retained towards an alleged debt of KShs.3,400,000 which the Plaintiff owed him. **Issues for determination** 1. Having considered the pleadings and evidence, the following issues arise: 2. Whether the Plaintiff authorised the 2nd Defendant to sell KDH 880T; 3. Whether fraud, forgery and conspiracy were proved against either Defendant; 4. Whether the 1st Defendant is liable to the Plaintiff; 5. Whether the 2nd Defendant properly accounted for the proceeds of sale; 6. Whether the Plaintiff is entitled to the reliefs sought; and 7. Who should bear costs. **Analysis and determination** Whether fraud was proved 1. Fraud is a serious allegation. A party alleging it must distinctly plead and distinctly prove the acts constituting the fraud. It is not sufficient for fraud to be left to inference. The parties referred the Court to Vijay Morjaria v Nansingh Madhusingh Darbar & Another [2000] eKLR, Kinyanjui Kamau v George Kamau Njoroge [2015] eKLR, and Moses Parantai & Peris Wanjiku Mukuru v Stephen Njoroge Macharia [2020] KECA 232 (KLR). 2. The consistent principle emerging from those authorities is that while proof of fraud in a civil case does not reach the criminal standard of proof beyond reasonable doubt, it requires evidence more cogent than that ordinarily sufficient on a simple balance of probabilities. The 2nd Defendant himself acknowledges that principle in his submissions. 3. Sections 107–109 of the Evidence Act equally place the initial burden upon the person asserting the relevant facts. The Plaintiff's case was that the affidavit of 12th November 2022 was forged and the email relied upon by the Defendants was fraudulent or generated after her email was hacked. Those are serious and specific allegations. The difficulty is that the evidentiary record does not contain forensic evidence establishing either proposition. 4. No document examiner was called to compare the disputed signature with an admitted specimen. Neither was the advocate before whom the disputed affidavits purportedly came into existence called to disown the commissioning or explain the circumstances in which the documents were prepared. 5. The absence of a handwriting expert or the commissioning advocate is not automatically fatal; fraud may be proved by other cogent circumstantial evidence. Nevertheless, where the principal question is whether a signature or electronic communication was fabricated, the Court must consider the quality of the evidence actually presented. 6. I have also considered the 2nd Defendant's submission that no evidence of a police report was produced. That submission must be approached cautiously because the Plaintiff's documentary material contains correspondence seeking investigation and material relating to subsequent criminal proceedings. The mere existence of a complaint or criminal proceedings, however, does not by itself prove the civil allegation of forgery against either Defendant. Whether the Plaintiff authorised the sale 1. The disputed affidavit cannot be considered in isolation. The evidence includes WhatsApp communications between the Plaintiff and the 1st Defendant concerning the outstanding balance and the possible sale of the vehicle. 2. Of particular significance is a communication attributed to the Plaintiff in which she complained that the 1st Defendant should seek information concerning the car from her and not Moses, but went on to state in substance that she had given Moses authority “to sell & not be owner.” That communication materially undermines the Plaintiff's categorical pleaded case that she never authorised the 2nd Defendant to sell the vehicle at all. 3. There is an important distinction between giving Moses ownership of the vehicle and authorising him to act as an intermediary to sell it. The WhatsApp communication is consistent with the latter. 4. The Plaintiff also communicated in terms indicating that the car could be sold so that the balance could be paid. When that evidence is considered together with the fact that KShs.450,000 remained outstanding and with the contemporaneous communications concerning the vehicle, I am not persuaded that the Plaintiff has proved that the 2nd Defendant had no authority whatsoever to sell KDH 880T. 5. The Plaintiff's submissions argued that only a registered Power of Attorney could legally authorise the sale. I am unable, on the evidence and authorities placed before me, to accept the broad proposition that a sale of movable property such as a motor vehicle can only be effected through a registered Power of Attorney. More importantly, the Plaintiff's own communications are relevant to the factual question whether she gave Moses authority to arrange a sale. 6. I therefore find, on a balance of probabilities, that the Plaintiff authorised the 2nd Defendant to procure the sale of KDH 880T for purposes which included settling the outstanding KShs.450,000 due to Royal Autoworld. That finding does not, however, resolve the entire dispute. Authority to sell property is not authority to appropriate its proceeds. The chronology of the sale 1. The Plaintiff's submissions also contend that the sale agreement between Moses and Daniel Ikiara Kamau was dated 4th November 2022, preceding the affidavits of 12th November 2022. 2. That would be a significant circumstance if established because it would mean that Moses had purported to sell the vehicle before the written authority upon which he principally relies. 3. There are, however, inconsistencies in the copies and references to dates in the record. The Defendants' case is that the transaction culminated in payment of KShs.450,000 to Royal Autoworld on 18th November 2022. Given those inconsistencies, I am not prepared to make a finding of fraud merely from counsel's characterisation of the date in submissions, particularly where the WhatsApp evidence independently points toward some authority to sell. Liability of the 1st Defendant 1. The 1st Defendant received KShs.450,000 from the proceeds. That was exactly the amount which the Plaintiff admittedly owed it under the original sale agreement. There is no evidence that the 1st Defendant received any part of the remaining KShs.750,000. Nor is there sufficient evidence to establish that Royal Autoworld participated in the alleged fabrication of the disputed affidavit or email. 2. The 1st Defendant was presented with communications which, viewed objectively and together with the WhatsApp messages, indicated that Moses had authority to sell the vehicle and use part of the proceeds to clear its outstanding balance. The Plaintiff had admittedly defaulted on the KShs.450,000. The 1st Defendant ultimately received no more than that contractual entitlement. 3. On the evidence before me, the heightened evidential threshold necessary to establish fraud or conspiracy against the 1st Defendant has not been attained. Accordingly, the suit against the 1st Defendant fails. The 2nd Defendant's duty to account 1. The position of the 2nd Defendant is materially different. Moses does not merely say that he facilitated the sale. He expressly admits that: he procured Daniel Ikiara Kamau as purchaser; he sold KDH 880T for KShs.1,200,000; the KShs.1.2 million was paid into his own bank account; he paid KShs.450,000 to Royal Autoworld; he paid or retained the remaining KShs.750,000 in the manner he describes. Those matters arise directly from his own defence. 2. Having received another person's sale proceeds in his own account pursuant to authority to sell, the 2nd Defendant assumed an obligation to account for those proceeds. The admitted arithmetic is straightforward. From KShs.1,200,000, payment of the admitted KShs.450,000 debt to Royal Autoworld left: KShs.1,200,000 – KShs.450,000 = KShs.750,000. 3. The question is what lawfully happened to that KShs.750,000. KShs.400,000 allegedly remitted to the Plaintiff. Moses produced DTB transaction notifications corresponding with transfers of KShs.300,000 on 25th November 2022 and KShs.100,000 on 5th January 2023 to account number 0168024258. His pleadings and submissions identify that account as the Plaintiff's. The Plaintiff challenged the sufficiency of that evidence and argued that Moses had not demonstrated that the account belonged to her. 4. On the evidence as a whole, however, I am satisfied on a balance of probabilities that the two transfers were made in connection with the sale transaction. They total KShs.400,000. That sum must therefore be credited to the 2nd Defendant. Alleged brokerage of KShs.100,000 1. Moses next deducts KShs.100,000 as brokerage fees. The evidentiary burden of proving that expenditure falls upon him. He received the Plaintiff's proceeds and it is he who asserts that KShs.100,000 was legitimately spent on her behalf. The record before me does not sufficiently identify the alleged broker or brokers, the agreed commission, the person to whom the KShs.100,000 was paid, or documentary acknowledgment of payment. 2. A bare assertion that KShs.100,000 was paid to brokers is not an adequate account for money received on behalf of another person. I therefore find that the alleged brokerage deduction of KShs.100,000 has not been proved. KShs.250,000 retained against alleged KShs.3.4 million debt 1. The 2nd Defendant expressly admits retaining another KShs.250,000. His justification is that the Plaintiff owed him KShs.3,400,000, and that he appropriated KShs.250,000 toward that alleged debt. Once again, that allegation concerns a fact peculiarly within the 2nd Defendant's knowledge and one upon which he relies to justify retaining the Plaintiff's money. 2. An admitted receipt or retention of another person's money cannot be justified merely by asserting an unrelated debt. The alleged debt required proof. 3. I have not been shown sufficient documentary or other evidence establishing that the Plaintiff owed Moses KShs.3.4 million, when the debt arose, the terms upon which it was advanced, or that Moses possessed a contractual right of set-off against the motor vehicle sale proceeds. Moreover, there is no pleaded counterclaim seeking judgment against the Plaintiff for KShs.3.4 million. I therefore find that the 2nd Defendant failed to establish a lawful basis for retaining KShs.250,000. Amount for which the 2nd Defendant failed to account 1. The result is: Sale proceeds....................................................KShs.1,200,000 Less Royal Autoworld.........................................KShs.450,000 Balance...............................................................KShs.750,000 Less proved remittances to Plaintiff......................KShs.400,000 Unaccounted balance..........................................KShs.350,000 1. The KShs.350,000 comprises the unproved KShs.100,000 brokerage deduction and the KShs.250,000 admittedly retained by the 2nd Defendant. The Plaintiff pleaded that the 2nd Defendant retained the balance of the sale proceeds. She claimed monetary recovery from the Defendants. The fact that she claimed KShs.1,350,000 does not oblige the Court either to award the entire amount or dismiss the claim altogether where the evidence establishes a lesser monetary entitlement falling within the pleaded claim. I therefore find the 2nd Defendant liable to account to the Plaintiff for KShs.350,000. Is the Plaintiff entitled to KShs.1,350,000? 1. No. The Plaintiff's claim for a full refund of KShs.1,350,000 proceeds on the premise that the sale itself was fraudulent and completely unauthorised. I have found that the evidence, particularly the contemporaneous communications, does not establish that proposition to the required standard. Further, the Plaintiff admittedly owed Royal Autoworld KShs.450,000. That debt was discharged from the proceeds of sale for her benefit. She also received, on the evidence accepted by the Court, KShs.400,000 from Moses. An award of KShs.1,350,000 without accounting for those benefits would place the Plaintiff in a position substantially better than that which existed before the disputed sale. The proved monetary loss attributable to the 2nd Defendant's failure to account is therefore KShs.350,000, not KShs.1,350,000. General damages for fraud and mental anguish 1. The Plaintiff also seeks general damages for fraud, mental anguish and damage suffered. Having found that fraud and conspiracy were not proved to the required standard, an award expressly founded upon fraud cannot issue. 2. Although the 2nd Defendant failed to account for KShs.350,000, the appropriate remedy on the pleadings and evidence is restoration of that money together with interest. The Plaintiff did not place before the Court sufficient evidence upon which a distinct monetary award for mental anguish or loss of user could reasonably be assessed. I therefore decline the prayer for general damages. **Conclusion** 1. This case ultimately turns on a distinction which the parties' positions tended to obscure. The evidence does not sufficiently prove that the sale itself was fraudulent. Indeed, the contemporaneous communications support the conclusion that Moses had authority to sell the vehicle. But authority to sell was not authority to keep the Plaintiff's money. 2. Moses received KShs.1.2 million. After paying the admitted KShs.450,000 balance to Royal Autoworld, he was required to account for KShs.750,000. He has satisfactorily accounted for KShs.400,000 remitted to the Plaintiff but has failed to establish a lawful basis for the remaining KShs.350,000. As against Royal Autoworld, the Plaintiff has not proved fraud or conspiracy. The company received only the KShs.450,000 which was contractually due to it. **Final orders** 1. Consequently, judgment is entered as follows: 2. The Plaintiff's suit against the 1st Defendant, Royal Autoworld International Limited, is dismissed. 3. Judgment is entered for the Plaintiff against the 2nd Defendant, Moses Mbugua Mungai, for KShs.350,000. 4. The prayer for general damages for fraud, mental anguish and loss of user is declined. 5. The sum of KShs.350,000 shall attract interest at court rates from the date of filing suit until payment in full. 6. As the Plaintiff has succeeded against the 2nd Defendant, though for substantially less than the amount claimed, the 2nd Defendant shall bear the Plaintiff's costs of the suit, subject to taxation/assessment. 7. As regards the 1st Defendant, considering that the transaction and subsequent dealings were intertwined and that its conduct legitimately formed part of the controversy requiring determination, I direct that each party shall bear its own costs in respect of the claim between the Plaintiff and the 1st Defendant. Orders accordingly. **DATED, SIGNED AND DELIVERED ONLINE VIA MICROSOFT TEAMS AT MOMBASA THIS 27TH AUGUST 2026.** ............................................ **EMILY M. MWAMUYE** **SENIOR RESIDENT MAGISTRATE**