The Appellant’s Case;
1. The Appellant lodged an appeal challenging the Ruling that was delivered on 15th November 2024 which it finds to be flawed in law.
2. Through the Memorandum of Appeal dated 10th December 2024 the Appellant prays for the following reliefs;
a) The appeal to be allowed in it’s entirety.
b) The Ruling and all consequential orders of Hon. Rawlings Liluma Musiega made on 15th November 2024 to be set aside.
c) An order dismissing with costs the Respondent’s application for injunctive relief before the Trial Court;
d) An award of costs of this Appeal to the Appellant.
3. Reliance is placed in Section 7(1) (a) of the Magistrates’ Court Act which stipulates that “A magistrate's court shall have and exercise such jurisdiction and powers in proceedings of a civil nature in which the value of the subject matter does not exceed twenty million shillings.”
4. According to the Appellant, the dispute before the Trial Court revolves around Motor vehicles: KDD 85P, KDG 369J, KDG 407Y, KCS 044K, KDG 425J, KHMA 316V, KCR 369H, KCH 045K, KHMA 657T, KHMA 548S, KHMA 957Q; Heavy machinery: Caterpillar Diesel Generator (DE33GC) and a JCB Roller.
5. According to the Appellant the financing agreements—placed before the Trial Court by both parties and found reflect a cumulative loan facility of Kshs. 50,317,000 exclusive of any interest and/or penalties which might have accrued as a result of default.
6. It argues that at the material time when the Appellant sought repossession, the total outstanding amount on the loan facilities was in excess of Kshs. 43,000,000, as evidenced by the unchallenged statements of account.
7. The cause of action in the suit filed at the Trial Court is the loan facility advanced, the securities and the amount due and owing which exceeds the pecuniary limit of the Trial Court particularly since the entire loan facility is recalled upon default according to the Appellant.
8. Reliance is placed in the case of Kangogo & another (Suing as the administrators of the Estate of the Late Richard Chelimo Kangogo) v IndusTrial and Commercial Development Corporation (Civil Case 2 of 2023) [2024] KEHC 4501 (KLR) (12 April 2024) (Judgment) this court found that a clause in a contract permitting the financier to recall the entire facility upon a default can be lawfully exercised by the financier on occurrence of default and should not be interfered with and/or is not illegal. It is trite law parties are bound by the terms of their contract.
9. Reliance is also placed in clause 17.2 of the Asset Finance Facility Agreements permitted the Appellant to recall the entire facility which at the time exceeded the pecuniary limit of the Trial. The Appellant moved to repossess all assets which exceed the pecuniary limit of this Honourable court, the Trial Court lacked jurisdiction to entertain the suit.
10. The Appellant argues that the Magistrate exceeded the jurisdiction conferred by statute and in doing so, he acted ultra vires and rendered a ruling that is, by operation of law, null and void.
11. Reliance is placed in the case of Owners of the Motor Vessel “Lillian S” v Caltex Oil (Kenya) Ltd [1989] KLR 1: “Jurisdiction is everything. Without it, a court has no power to make one more step... A court of law downs its tools in respect of the matter before it the moment it holds the opinion that it is without jurisdiction.”
12. The Appellant submits that the magistrate’s action amounted to an unlawful assumption of judicial power.
13. The Appellant is aggrieved that the Trial Court proceeded to grant interim injunctive reliefs on the ground that the interest rates levied by the Appellant were excessive, unjust, and contrary to the agreed contractual terms.
14. The Court of Appeal in the case of Fina Bank Ltd. V Ronak Ltd, [2001] 1 EA 54 stated that dispute on accounts is not a basis for grant of an injunction, and more specifically on interest, it stated as follows:
“…As the charge documents which were in evidence before the High Court expressly reserved, in favour of the Appellant, the right to charge interest at variable rates its absolute and sole discretion, the contractual relationship between the parties could not be impeached because the exact rate or rates had not been specified. Accordingly the Respondents had not made out a case for injunctive relief in their favour and the order of the High Court had no sound basis.”
15. The basis upon which the Honourable Magistrate granted injunctive remedies to the Respondent is flawed according to the appellant.
16. Reliance is placed in the Court of Appeal in Nguruman Limited v Jan Bonde Nielsen & 2 Others [2014] eKLR authoritatively reaffirmed the three-tier test in Giella v Cassman Brown [1973] EA 358, and cautioned that: "Speculative injury cannot be a basis for granting an injunction. To merit interlocutory protection, the harm feared must be real, imminent and incapable of being remedied by an award of damages."
17. In Andrew Muriuki Wanjohi v Equity Building Society & Another [2006] eKLR, injury arising from commercial enforcement of a debt obligation is not irreparable, and can be compensated.
18. The injunctive reliefs granted were therefore procedurally unwarranted and legally untenable.
19. The Honourable Magistrate, with respect, ventured into a matter far beyond the statutory threshold prescribed under Section 7(1) of the Magistrates’ Court Act, and thereby rendered a decision that is ultra vires, null, and void.
20. The injunctive orders granted were not only premature but based on speculative assertions incapable of satisfying the high bar set by binding judicial precedent.
21. The Appellant, who was lawfully exercising its rights under the contractual instruments, was halted by a legally flawed and procedurally unsound injunction.
The Respondent’s Case:
22. The Respondent believes that the Trial Court is possessed of the requisite pecuniary jurisdiction to adjudicate the underlying dispute.
23. It is its case that an Appellate Court does not act as a Court of first instance and cannot entertain fresh issues unless they are pure questions of law arising from undisputed facts and whose determination is necessary to avert a miscarriage of justice. That exception does not apply here. As on 15thNovember 2024 only those issues that were raised, argued, and determined as of that date can properly be the subject of this appeal.
24. It is its case that the issue of jurisdiction was raised only after the ruling of 15th November 2024 had already been delivered.
25. It argues that the issue of jurisdiction was raised by way of a Preliminary Objection filed on 22nd January 2025, and that the said objection was heard and dismissed by the Trial Court in a separate ruling delivered on 25th April 2025.
26. An appeal challenging the jurisdiction of the Trial Court ought to emanate from the ruling of 25th April 2025, which is the ruling in which that issue was raised, heard, and determined according to the Appellant.
27. The appeal before the Court seeks to impugn the decision rendered on 15th November 2024, at a time when the question of jurisdiction was neither raised nor determined. It argues that this Court, lacks jurisdiction to make a determination on a question that was not the subject of determination in the impugned ruling.
28. Reliance is placed in the Court of Appeal in Masinjila v Kanda (Civil Appeal 111 of 2019) [2024] KECA 1086 (KLR) (19 August 2024), where the learned Judges held:
"We cannot in good conscience determine a matter raised for the first time in an appeal, the said issue not having been raised and a determination made thereof which determination then becomes the subject of an appeal."
29. It submits that the present appeal is improper to the extent that it invites this Honourable Court to adjudicate on a question of jurisdiction that was not part of the impugned decision of 15th November 2024.
30. That issue according to the Respondent properly belongs to an appeal arising from the ruling of 25th April 2025—which has not been filed.
31. On the issue of the injunction, it submits that the legal test for the grant of a Temporary Injunction is now well-settled. The Court of Appeal in the seminal case of Nguruman Limited v Jan Bonde Nielsen & 2 Others [2014] eKLR, held as follows:
“… these are the three pillars on which rest the foundation of any order of injunction, interlocutory or permanent. It is established that all the above three conditions and stages are to be applied as separate, distinct and logical hurdles which the applicant is expected to surmount sequentially… if the applicant establishes a prima facie case that alone is not sufficient basis to grant an interlocutory injunction, the court must further be satisfied that the injury the Respondent will suffer, in the event the injunction is not granted will be irreparable. In other words, if damages recoverable in law are an adequate remedy and the Respondent is capable of paying, no interlocutory order of injunction should normally be granted, however strong the applicant’s claim may appear at that stage. If prima facie case is not established, then irreparable injury and balance of convenience need no consideration.”
32. It is from this three-limb test—prima facie case, irreparable injury, and balance of convenience—that the Trial Court correctly examined the merits of the application and granted the temporary injunction.
33. The Trial Court correctly appreciated that a prima facie case is more than just an arguable case.
34. It must be one that demonstrates infringement of a right or shows a high probability of success at trial.
35. The Applicant’s supporting affidavit showed, on oath, that the Respondent levied an interest rate that was excessive, arbitrary, and contrary to the express terms of the loan agreement.
36. The Applicant further demonstrated that these revised rates were imposed without notice and in breach of the contractual framework.
37. This is not a mere difference of opinion or interpretation—it is an outright challenge to the lawfulness of the Respondent’s conduct in the administration of the loan facility according to the Appellant.
38. The applicant argues that the Trial Court was right to find that a prima facie case had been established.
39. The second limb—irreparable harm—was also met. The Appellant in this appeal repossessed certain motor vehicles which it intends to dispose of through sale.These assets are not only of high commercial value but also form part of the very subject matter of the dispute.
40. Once sold and the proceeds applied to an inflated and disputed loan account, the substratum of the suit would be lost. It argues that the damage caused would not be adequately remediable through an award of damages, particularly where the resale process is opaque or subject to third-party interests.
41. On the third limb—balance of convenience—the Appellant submits that it clearly tilts in favour of the Respondent in this appeal. The injunction serves one purpose: to preserve the status quo pending hearing and determination. The Respondent merely seeks to prevent the dissipation of assets while the legality of the loan enforcement is scrutinized.
42. In contrast, the Appellant is not prejudiced by this, particularly where its right to recover any genuine outstanding sums remains intact upon the conclusion of the matter.
43. The Appellant believes that the Court correctly exercised its discretion in granting the injunction.The threshold for a temporary injunction was rightly applied and met, and to uphold the decision of the Trial Court.
Analysis and Determination;
The following are the issues for determination;
1) Whether the appeal has merit.
2) Who shall bear costs.
44. In Selle & Another vs. Associated Motor Boat Co Ltd & Others [1968] EA The court therein held that the appellate court was not bound by the findings of fact of the Trial Court but that in re-considering and re-evaluating the evidence so as to draw its own conclusions, it always had to bear in mind that it neither saw nor heard the witnesses and thus make due allowance in that respect.
45. The Supreme Court of India on the 27th day of April, 2015 in the case of K. Anbazhagan v. State of Karnataka and Others, as follows;
“The appellate court has a duty to make a complete and comprehensive appreciation of all vital features of the case. The evidence brought on record in entirety has to be scrutinized with care and caution. It is the duty of the Judge to see that justice is appropriately administered, for that is the paramount consideration of a Judge. The said responsibility cannot be abdicated or abandoned or ostracized, even remotely.....The appellate court is required to weigh the materials, ascribe concrete reasons and the filament of reasoning must logically flow from the requisite analysis of the material on record. The approach cannot be cryptic. It cannot be perverse. The duty of the Judge is to consider the evidence objectively and dispassionately. The reasoning in appeal are to be well deliberated. They are to be resolutely expressed. An objective judgment of the evidence reflects the greatness of mind - sans passion and sans prejudice. The reflective attitude of the Judge must be demonstrable from the judgment itself. A judge must avoid all kind of weakness and vacillation. That is the sole test. That is the litmus test.”
46. The Respondent advanced an argument that this Court sitting in its appellate jurisdiction does not act as a Court of first instance and cannot entertain fresh issues unless they are pure questions of law arising from undisputed facts and whose determination is necessary to avert a miscarriage of justice. That exception does not apply here.
47. According to the Respondent, an appeal is a review of a determination of the Trial Court based on the issues that were alive and determined at the time the impugned decision was rendered.
48. The Respondent argued that as on 15thNovember 2024 the issue of jurisdiction was raised only after the ruling of 15th November 2024 had already been delivered by way of a Preliminary Objection filed on 22nd January 2025, and that the said objection was heard and dismissed by the trial court in a separate ruling delivered on 25th April 2025.
49. The Respondent argued that the appeal before the Court seeks to impugn the decision rendered on 15th November 2024, at a time when the question of jurisdiction was neither raised nor determined.
50. It is this court's finding that sitting in its appellate jurisdiction it is not bound by the findings of fact of the trial court. It can re-consider and re-evaluate the evidence all over again and arrive at its own conclusions within the principles as enunciated in the Selle case (supra).
51. Having so held, this court has looked at the question whether it has the jurisdiction to interrogate whether it has the relook at the issue of the Jurisdiction of the trial court.
52. Section 7(1) (a) of the Magistrates’ Court Act is unequivocal: “A magistrate's court shall have and exercise such jurisdiction and powers in proceedings of a civil nature in which the value of the subject matter does not exceed twenty million shillings.”
53. According to the Appellant, the dispute before the Trial Court revolves around Motor vehicles: KDD 85P, KDG 369J, KDG 407Y, KCS 044K, KDG 425J, KHMA 316V, KCR 369H, KCH 045K, KHMA 657T, KHMA 548S, KHMA 957Q; Heavy machinery: Caterpillar Diesel Generator (DE33GC) and a JCB Roller.
54. According to the Appellant the financing agreements placed before the Trial Court by both parties reflect a cumulative loan facility of Kshs. 50,317,000 exclusive of any interest and/or penalties which might have accrued as a result of default.
55. At the material time when the Appellant sought repossession, the total outstanding amount on the loan facilities was in excess of Kshs. 43,000,000.
56. The Respondent did not challenge the fact that the pecuniary value of the subject matter exceeds twenty million shillings.
57. Instead of addressing the issue of jurisdiction as raised by the Appellant, the Respondent advanced the argument that the issue of jurisdiction was raised by way of a Preliminary Objection filed on 22nd January 2025, and that the said objection was heard and dismissed by the Trial Court in a separate ruling delivered on 25th April 2025.
58. All it engages in is nullity. Nyarangi, JA, in Owners of Motor Vessel ‘Lillian S’ v Caltex Oil (Kenya) Limited [1989] KLR 1 expressed himself as follows on the issue of jurisdiction: -
“Jurisdiction is everything. Without it, a court has no power to make one more step. Where a court has no jurisdiction, there would be no basis for a continuation of proceedings…”
59. Indeed, so determinative is the issue of jurisdiction such that it can be raised at any stage of the proceedings.
60. In Adero & Another vs. Ulinzi Sacco Society Limited [2002] 1 KLR 577, as follows;
1) ……..
2) The jurisdiction either exists or does not ab initio …
3) jurisdiction cannot be conferred by the consent of the parties or be assumed on the grounds that parties have acquiesced in
4) actions which presume the existence of such jurisdiction.
5) Jurisdiction is such an important matter that it can be raised at any stage of the proceedings even on appeal.
61. In Petition No. 7 of 2013 Mary Wambui Munene v. Peter Gichuki Kingara and Six Others, [2014] eKLR, the Supreme Court held that ‘jurisdiction is a pure question of law’ and should be resolved on priority basis.
62. Jurisdiction is defined in Halsbury’s Laws of England (4th Ed.) Vol. 9 as “…the authority which a Court has to decide matters that are litigated before it or to take cognizance of matters presented in a formal way for decision.”
63. Black’s Law Dictionary, 9th Edition, defines jurisdiction as the Court’s power to entertain, hear and determine a dispute before it.
64. In Words and Phrases Legally Defined Vol. 3, John Beecroft Saunders defines jurisdiction as follows:
“By jurisdiction is meant the authority which a Court has to decide matters that are litigated before it or to take cognisance of matters presented in a formal way for its decision. The limits of this authority are imposed by the statute, charter or commission under which the Court is constituted, and may be extended or restricted by like means. If no restriction or limit is imposed, the jurisdiction is said to be unlimited. A limitation may be either as to the kind and nature of the actions and matters of which the particular Court has cognisance or as to the area over which the jurisdiction shall extend, or it may partake both these characteristics…. Where a Court takes upon itself to exercise a jurisdiction which it does not possess, its decision amounts to nothing. Jurisdiction must be acquired before judgment is given.” That, jurisdiction is so central in judicial proceedings, is a well settled principle in law. A Court acting without jurisdiction is acting in vain.
65. The Court of Appeal in Kakuta Maimai Hamisi -vs- Peris Pesi Tobiko & 2 Others (2013) eKLR stated that: -
“So central and determinative is the jurisdiction that it is at once fundamental and over-arching as far as any judicial proceedings in concerned. It is a threshold question and best taken at inception. It is definitive and determinative and prompt pronouncement on it once it appears to be in issue in a consideration imposed on courts out of decent respect for economy and efficiency and necessary eschewing of a polite but ultimate futile undertaking of proceedings that will end in barren cui-de-sac. Courts, like nature, must not sit in vain.”
66. The source of a Court’s jurisdiction, the Supreme Court of Kenya in Samuel Kamau Macharia & Another vs. Kenya Commercial Bank Limited & others (2012) eKLR stated as follows: -
“13. A Court’s jurisdiction flows from either the Constitution or legislation or both. Thus, a court of law can only exercise jurisdiction as conferred by the Constitution or other written law. It cannot arrogate to itself jurisdiction exceeding that which is conferred upon it by law. We agree with counsels for the first and second Respondents in his submission that the issue as to whether a Court of law has jurisdiction to entertain a matter before it, is not one of mere procedural technicality, it goes to the very heart of the matter, for without jurisdiction, the Court cannot entertain any proceedings … where the Constitution exhaustively provides for the jurisdiction of a Court of law, the Court must operate within the constitutional limits. It cannot expand its jurisdiction through judicial craft or innovation. Nor can Parliament confer jurisdiction upon a Court of law beyond the scope defined by the Constitution. Where the Constitution confers power upon Parliament to set the jurisdiction of a Court of law or tribunal, the legislature would be within its authority to prescribe the jurisdiction of such a court or tribunal by statute law.”
67. In the instant appeal this court is of the view that the jurisdiction issues are always alive and nothing can be done to eradicate it. The jurisdiction issue follows a suit from the day it gets into the justice system from the trial Court through to the Supreme Court.
68. The fact that the lower court embraced jurisdiction where none existed cannot be said to be the final legal position on the issue of jurisdiction. To hold so would amount to a betrayal and an abdication of my duty to protect and promote the rule of law. An appellate court can raise and cure the illegality which I hereby do.
Costs;
69. In the case of Jasbir Singh Rai & 3 others v Tarlochan Singh Rai & 4 others [2014] eKLR, it was held, to the same intent Mr. Justice (Rtd.) Kuloba thus writes in his work, Judicial Hints on Civil Procedure, 2nd ed. (Nairobi: Law Africa, 2011), p. 94:
“Costs are [awarded at] the unfettered discretion of the court, subject to such conditions and limitations as may be prescribed and to the provisions of any law for the time being in force, but they must follow the event unless the court has good reason to order otherwise: Chamilabs v. LaljiBhimji and Shamji JinabhaiPatel, High Court of Kenya, Civil Case No. 1062 of 1973.”
Determination;
70. The orders of the trial Court are none consequential and the same is set aside given that they were issued by a court that lacked jurisdiction.
Order;
The appeal is allowed with costs.
1. The Appellant lodged an appeal challenging the Ruling that was delivered on 15th November 2024 which it finds to be flawed in law.
2. Through the Memorandum of Appeal dated 10th December 2024 the Appellant prays for the following reliefs;
a) The appeal to be allowed in it’s entirety.
b) The Ruling and all consequential orders of Hon. Rawlings Liluma Musiega made on 15th November 2024 to be set aside.
c) An order dismissing with costs the Respondent’s application for injunctive relief before the Trial Court;
d) An award of costs of this Appeal to the Appellant.
3. Reliance is placed in Section 7(1) (a) of the Magistrates’ Court Act which stipulates that “A magistrate's court shall have and exercise such jurisdiction and powers in proceedings of a civil nature in which the value of the subject matter does not exceed twenty million shillings.”
4. According to the Appellant, the dispute before the Trial Court revolves around Motor vehicles: KDD 85P, KDG 369J, KDG 407Y, KCS 044K, KDG 425J, KHMA 316V, KCR 369H, KCH 045K, KHMA 657T, KHMA 548S, KHMA 957Q; Heavy machinery: Caterpillar Diesel Generator (DE33GC) and a JCB Roller.
5. According to the Appellant the financing agreements—placed before the Trial Court by both parties and found reflect a cumulative loan facility of Kshs. 50,317,000 exclusive of any interest and/or penalties which might have accrued as a result of default.
6. It argues that at the material time when the Appellant sought repossession, the total outstanding amount on the loan facilities was in excess of Kshs. 43,000,000, as evidenced by the unchallenged statements of account.
7. The cause of action in the suit filed at the Trial Court is the loan facility advanced, the securities and the amount due and owing which exceeds the pecuniary limit of the Trial Court particularly since the entire loan facility is recalled upon default according to the Appellant.
8. Reliance is placed in the case of Kangogo & another (Suing as the administrators of the Estate of the Late Richard Chelimo Kangogo) v IndusTrial and Commercial Development Corporation (Civil Case 2 of 2023) [2024] KEHC 4501 (KLR) (12 April 2024) (Judgment) this court found that a clause in a contract permitting the financier to recall the entire facility upon a default can be lawfully exercised by the financier on occurrence of default and should not be interfered with and/or is not illegal. It is trite law parties are bound by the terms of their contract.
9. Reliance is also placed in clause 17.2 of the Asset Finance Facility Agreements permitted the Appellant to recall the entire facility which at the time exceeded the pecuniary limit of the Trial. The Appellant moved to repossess all assets which exceed the pecuniary limit of this Honourable court, the Trial Court lacked jurisdiction to entertain the suit.
10. The Appellant argues that the Magistrate exceeded the jurisdiction conferred by statute and in doing so, he acted ultra vires and rendered a ruling that is, by operation of law, null and void.
11. Reliance is placed in the case of Owners of the Motor Vessel “Lillian S” v Caltex Oil (Kenya) Ltd [1989] KLR 1: “Jurisdiction is everything. Without it, a court has no power to make one more step... A court of law downs its tools in respect of the matter before it the moment it holds the opinion that it is without jurisdiction.”
12. The Appellant submits that the magistrate’s action amounted to an unlawful assumption of judicial power.
13. The Appellant is aggrieved that the Trial Court proceeded to grant interim injunctive reliefs on the ground that the interest rates levied by the Appellant were excessive, unjust, and contrary to the agreed contractual terms.
14. The Court of Appeal in the case of Fina Bank Ltd. V Ronak Ltd, [2001] 1 EA 54 stated that dispute on accounts is not a basis for grant of an injunction, and more specifically on interest, it stated as follows:
“…As the charge documents which were in evidence before the High Court expressly reserved, in favour of the Appellant, the right to charge interest at variable rates its absolute and sole discretion, the contractual relationship between the parties could not be impeached because the exact rate or rates had not been specified. Accordingly the Respondents had not made out a case for injunctive relief in their favour and the order of the High Court had no sound basis.”
15. The basis upon which the Honourable Magistrate granted injunctive remedies to the Respondent is flawed according to the appellant.
16. Reliance is placed in the Court of Appeal in Nguruman Limited v Jan Bonde Nielsen & 2 Others [2014] eKLR authoritatively reaffirmed the three-tier test in Giella v Cassman Brown [1973] EA 358, and cautioned that: "Speculative injury cannot be a basis for granting an injunction. To merit interlocutory protection, the harm feared must be real, imminent and incapable of being remedied by an award of damages."
17. In Andrew Muriuki Wanjohi v Equity Building Society & Another [2006] eKLR, injury arising from commercial enforcement of a debt obligation is not irreparable, and can be compensated.
18. The injunctive reliefs granted were therefore procedurally unwarranted and legally untenable.
19. The Honourable Magistrate, with respect, ventured into a matter far beyond the statutory threshold prescribed under Section 7(1) of the Magistrates’ Court Act, and thereby rendered a decision that is ultra vires, null, and void.
20. The injunctive orders granted were not only premature but based on speculative assertions incapable of satisfying the high bar set by binding judicial precedent.
21. The Appellant, who was lawfully exercising its rights under the contractual instruments, was halted by a legally flawed and procedurally unsound injunction.
The Respondent’s Case:
22. The Respondent believes that the Trial Court is possessed of the requisite pecuniary jurisdiction to adjudicate the underlying dispute.
23. It is its case that an Appellate Court does not act as a Court of first instance and cannot entertain fresh issues unless they are pure questions of law arising from undisputed facts and whose determination is necessary to avert a miscarriage of justice. That exception does not apply here. As on 15thNovember 2024 only those issues that were raised, argued, and determined as of that date can properly be the subject of this appeal.
24. It is its case that the issue of jurisdiction was raised only after the ruling of 15th November 2024 had already been delivered.
25. It argues that the issue of jurisdiction was raised by way of a Preliminary Objection filed on 22nd January 2025, and that the said objection was heard and dismissed by the Trial Court in a separate ruling delivered on 25th April 2025.
26. An appeal challenging the jurisdiction of the Trial Court ought to emanate from the ruling of 25th April 2025, which is the ruling in which that issue was raised, heard, and determined according to the Appellant.
27. The appeal before the Court seeks to impugn the decision rendered on 15th November 2024, at a time when the question of jurisdiction was neither raised nor determined. It argues that this Court, lacks jurisdiction to make a determination on a question that was not the subject of determination in the impugned ruling.
28. Reliance is placed in the Court of Appeal in Masinjila v Kanda (Civil Appeal 111 of 2019) [2024] KECA 1086 (KLR) (19 August 2024), where the learned Judges held:
"We cannot in good conscience determine a matter raised for the first time in an appeal, the said issue not having been raised and a determination made thereof which determination then becomes the subject of an appeal."
29. It submits that the present appeal is improper to the extent that it invites this Honourable Court to adjudicate on a question of jurisdiction that was not part of the impugned decision of 15th November 2024.
30. That issue according to the Respondent properly belongs to an appeal arising from the ruling of 25th April 2025—which has not been filed.
31. On the issue of the injunction, it submits that the legal test for the grant of a Temporary Injunction is now well-settled. The Court of Appeal in the seminal case of Nguruman Limited v Jan Bonde Nielsen & 2 Others [2014] eKLR, held as follows:
“… these are the three pillars on which rest the foundation of any order of injunction, interlocutory or permanent. It is established that all the above three conditions and stages are to be applied as separate, distinct and logical hurdles which the applicant is expected to surmount sequentially… if the applicant establishes a prima facie case that alone is not sufficient basis to grant an interlocutory injunction, the court must further be satisfied that the injury the Respondent will suffer, in the event the injunction is not granted will be irreparable. In other words, if damages recoverable in law are an adequate remedy and the Respondent is capable of paying, no interlocutory order of injunction should normally be granted, however strong the applicant’s claim may appear at that stage. If prima facie case is not established, then irreparable injury and balance of convenience need no consideration.”
32. It is from this three-limb test—prima facie case, irreparable injury, and balance of convenience—that the Trial Court correctly examined the merits of the application and granted the temporary injunction.
33. The Trial Court correctly appreciated that a prima facie case is more than just an arguable case.
34. It must be one that demonstrates infringement of a right or shows a high probability of success at trial.
35. The Applicant’s supporting affidavit showed, on oath, that the Respondent levied an interest rate that was excessive, arbitrary, and contrary to the express terms of the loan agreement.
36. The Applicant further demonstrated that these revised rates were imposed without notice and in breach of the contractual framework.
37. This is not a mere difference of opinion or interpretation—it is an outright challenge to the lawfulness of the Respondent’s conduct in the administration of the loan facility according to the Appellant.
38. The applicant argues that the Trial Court was right to find that a prima facie case had been established.
39. The second limb—irreparable harm—was also met. The Appellant in this appeal repossessed certain motor vehicles which it intends to dispose of through sale.These assets are not only of high commercial value but also form part of the very subject matter of the dispute.
40. Once sold and the proceeds applied to an inflated and disputed loan account, the substratum of the suit would be lost. It argues that the damage caused would not be adequately remediable through an award of damages, particularly where the resale process is opaque or subject to third-party interests.
41. On the third limb—balance of convenience—the Appellant submits that it clearly tilts in favour of the Respondent in this appeal. The injunction serves one purpose: to preserve the status quo pending hearing and determination. The Respondent merely seeks to prevent the dissipation of assets while the legality of the loan enforcement is scrutinized.
42. In contrast, the Appellant is not prejudiced by this, particularly where its right to recover any genuine outstanding sums remains intact upon the conclusion of the matter.
43. The Appellant believes that the Court correctly exercised its discretion in granting the injunction.The threshold for a temporary injunction was rightly applied and met, and to uphold the decision of the Trial Court.
Analysis and Determination;
The following are the issues for determination;
1) Whether the appeal has merit.
2) Who shall bear costs.
44. In Selle & Another vs. Associated Motor Boat Co Ltd & Others [1968] EA The court therein held that the appellate court was not bound by the findings of fact of the Trial Court but that in re-considering and re-evaluating the evidence so as to draw its own conclusions, it always had to bear in mind that it neither saw nor heard the witnesses and thus make due allowance in that respect.
45. The Supreme Court of India on the 27th day of April, 2015 in the case of K. Anbazhagan v. State of Karnataka and Others, as follows;
“The appellate court has a duty to make a complete and comprehensive appreciation of all vital features of the case. The evidence brought on record in entirety has to be scrutinized with care and caution. It is the duty of the Judge to see that justice is appropriately administered, for that is the paramount consideration of a Judge. The said responsibility cannot be abdicated or abandoned or ostracized, even remotely.....The appellate court is required to weigh the materials, ascribe concrete reasons and the filament of reasoning must logically flow from the requisite analysis of the material on record. The approach cannot be cryptic. It cannot be perverse. The duty of the Judge is to consider the evidence objectively and dispassionately. The reasoning in appeal are to be well deliberated. They are to be resolutely expressed. An objective judgment of the evidence reflects the greatness of mind - sans passion and sans prejudice. The reflective attitude of the Judge must be demonstrable from the judgment itself. A judge must avoid all kind of weakness and vacillation. That is the sole test. That is the litmus test.”
46. The Respondent advanced an argument that this Court sitting in its appellate jurisdiction does not act as a Court of first instance and cannot entertain fresh issues unless they are pure questions of law arising from undisputed facts and whose determination is necessary to avert a miscarriage of justice. That exception does not apply here.
47. According to the Respondent, an appeal is a review of a determination of the Trial Court based on the issues that were alive and determined at the time the impugned decision was rendered.
48. The Respondent argued that as on 15thNovember 2024 the issue of jurisdiction was raised only after the ruling of 15th November 2024 had already been delivered by way of a Preliminary Objection filed on 22nd January 2025, and that the said objection was heard and dismissed by the trial court in a separate ruling delivered on 25th April 2025.
49. The Respondent argued that the appeal before the Court seeks to impugn the decision rendered on 15th November 2024, at a time when the question of jurisdiction was neither raised nor determined.
50. It is this court's finding that sitting in its appellate jurisdiction it is not bound by the findings of fact of the trial court. It can re-consider and re-evaluate the evidence all over again and arrive at its own conclusions within the principles as enunciated in the Selle case (supra).
51. Having so held, this court has looked at the question whether it has the jurisdiction to interrogate whether it has the relook at the issue of the Jurisdiction of the trial court.
52. Section 7(1) (a) of the Magistrates’ Court Act is unequivocal: “A magistrate's court shall have and exercise such jurisdiction and powers in proceedings of a civil nature in which the value of the subject matter does not exceed twenty million shillings.”
53. According to the Appellant, the dispute before the Trial Court revolves around Motor vehicles: KDD 85P, KDG 369J, KDG 407Y, KCS 044K, KDG 425J, KHMA 316V, KCR 369H, KCH 045K, KHMA 657T, KHMA 548S, KHMA 957Q; Heavy machinery: Caterpillar Diesel Generator (DE33GC) and a JCB Roller.
54. According to the Appellant the financing agreements placed before the Trial Court by both parties reflect a cumulative loan facility of Kshs. 50,317,000 exclusive of any interest and/or penalties which might have accrued as a result of default.
55. At the material time when the Appellant sought repossession, the total outstanding amount on the loan facilities was in excess of Kshs. 43,000,000.
56. The Respondent did not challenge the fact that the pecuniary value of the subject matter exceeds twenty million shillings.
57. Instead of addressing the issue of jurisdiction as raised by the Appellant, the Respondent advanced the argument that the issue of jurisdiction was raised by way of a Preliminary Objection filed on 22nd January 2025, and that the said objection was heard and dismissed by the Trial Court in a separate ruling delivered on 25th April 2025.
58. All it engages in is nullity. Nyarangi, JA, in Owners of Motor Vessel ‘Lillian S’ v Caltex Oil (Kenya) Limited [1989] KLR 1 expressed himself as follows on the issue of jurisdiction: -
“Jurisdiction is everything. Without it, a court has no power to make one more step. Where a court has no jurisdiction, there would be no basis for a continuation of proceedings…”
59. Indeed, so determinative is the issue of jurisdiction such that it can be raised at any stage of the proceedings.
60. In Adero & Another vs. Ulinzi Sacco Society Limited [2002] 1 KLR 577, as follows;
1) ……..
2) The jurisdiction either exists or does not ab initio …
3) jurisdiction cannot be conferred by the consent of the parties or be assumed on the grounds that parties have acquiesced in
4) actions which presume the existence of such jurisdiction.
5) Jurisdiction is such an important matter that it can be raised at any stage of the proceedings even on appeal.
61. In Petition No. 7 of 2013 Mary Wambui Munene v. Peter Gichuki Kingara and Six Others, [2014] eKLR, the Supreme Court held that ‘jurisdiction is a pure question of law’ and should be resolved on priority basis.
62. Jurisdiction is defined in Halsbury’s Laws of England (4th Ed.) Vol. 9 as “…the authority which a Court has to decide matters that are litigated before it or to take cognizance of matters presented in a formal way for decision.”
63. Black’s Law Dictionary, 9th Edition, defines jurisdiction as the Court’s power to entertain, hear and determine a dispute before it.
64. In Words and Phrases Legally Defined Vol. 3, John Beecroft Saunders defines jurisdiction as follows:
“By jurisdiction is meant the authority which a Court has to decide matters that are litigated before it or to take cognisance of matters presented in a formal way for its decision. The limits of this authority are imposed by the statute, charter or commission under which the Court is constituted, and may be extended or restricted by like means. If no restriction or limit is imposed, the jurisdiction is said to be unlimited. A limitation may be either as to the kind and nature of the actions and matters of which the particular Court has cognisance or as to the area over which the jurisdiction shall extend, or it may partake both these characteristics…. Where a Court takes upon itself to exercise a jurisdiction which it does not possess, its decision amounts to nothing. Jurisdiction must be acquired before judgment is given.” That, jurisdiction is so central in judicial proceedings, is a well settled principle in law. A Court acting without jurisdiction is acting in vain.
65. The Court of Appeal in Kakuta Maimai Hamisi -vs- Peris Pesi Tobiko & 2 Others (2013) eKLR stated that: -
“So central and determinative is the jurisdiction that it is at once fundamental and over-arching as far as any judicial proceedings in concerned. It is a threshold question and best taken at inception. It is definitive and determinative and prompt pronouncement on it once it appears to be in issue in a consideration imposed on courts out of decent respect for economy and efficiency and necessary eschewing of a polite but ultimate futile undertaking of proceedings that will end in barren cui-de-sac. Courts, like nature, must not sit in vain.”
66. The source of a Court’s jurisdiction, the Supreme Court of Kenya in Samuel Kamau Macharia & Another vs. Kenya Commercial Bank Limited & others (2012) eKLR stated as follows: -
“13. A Court’s jurisdiction flows from either the Constitution or legislation or both. Thus, a court of law can only exercise jurisdiction as conferred by the Constitution or other written law. It cannot arrogate to itself jurisdiction exceeding that which is conferred upon it by law. We agree with counsels for the first and second Respondents in his submission that the issue as to whether a Court of law has jurisdiction to entertain a matter before it, is not one of mere procedural technicality, it goes to the very heart of the matter, for without jurisdiction, the Court cannot entertain any proceedings … where the Constitution exhaustively provides for the jurisdiction of a Court of law, the Court must operate within the constitutional limits. It cannot expand its jurisdiction through judicial craft or innovation. Nor can Parliament confer jurisdiction upon a Court of law beyond the scope defined by the Constitution. Where the Constitution confers power upon Parliament to set the jurisdiction of a Court of law or tribunal, the legislature would be within its authority to prescribe the jurisdiction of such a court or tribunal by statute law.”
67. In the instant appeal this court is of the view that the jurisdiction issues are always alive and nothing can be done to eradicate it. The jurisdiction issue follows a suit from the day it gets into the justice system from the trial Court through to the Supreme Court.
68. The fact that the lower court embraced jurisdiction where none existed cannot be said to be the final legal position on the issue of jurisdiction. To hold so would amount to a betrayal and an abdication of my duty to protect and promote the rule of law. An appellate court can raise and cure the illegality which I hereby do.
Costs;
69. In the case of Jasbir Singh Rai & 3 others v Tarlochan Singh Rai & 4 others [2014] eKLR, it was held, to the same intent Mr. Justice (Rtd.) Kuloba thus writes in his work, Judicial Hints on Civil Procedure, 2nd ed. (Nairobi: Law Africa, 2011), p. 94:
“Costs are [awarded at] the unfettered discretion of the court, subject to such conditions and limitations as may be prescribed and to the provisions of any law for the time being in force, but they must follow the event unless the court has good reason to order otherwise: Chamilabs v. LaljiBhimji and Shamji JinabhaiPatel, High Court of Kenya, Civil Case No. 1062 of 1973.”
Determination;
70. The orders of the trial Court are none consequential and the same is set aside given that they were issued by a court that lacked jurisdiction.
Order;
The appeal is allowed with costs.