' THE REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA
AT BUNGOMA
CIVIL APPEAL NO. E008 OF 2024
DANIEL NJURU KARIUKI……………………………….…….APPELLANT
VERSUS
JAMES MUIGAI KARIUKI…………………….……………RESPONDENT
(Being an appeal against the judgement/decree of the Chief Magistrate’s Court at Bungoma (Hon. T.M. Olando-PM) delivered on 20th December 2023 in Bungoma CMCC No. E040 of 2023)
JUDGEMENT
1. The Respondent herein instituted a suit at the magistracy seeking the following orders:
a. Accumulated mense profit to be assessed by the Honourable Court.
b. Release of motor vehicle registration KCC 106R Toyota Town Ace to the Plaintiff.
c. Costs of the suit.
d. Interest.
e. Any other relief the Honourable Court deems fit and just to grant.
2. According to the Plaint dated 27th January 2023, the Respondent averred that he was the lawful owner of motor vehicle registration number KCC 106R Toyota Town Ace and that sometime in the month of June 2022 he used the motor vehicle as a collateral to obtain a loan of Kshs. 150,000/= plus interest and other incidentals totaling to Kshs. 242,500/= from Platinum Credit Limited. He averred that upon his default in servicing the loan, his said motor vehicle registration number KCC 106R Toyota Town Ace was attached to meet the remaining outstanding loan sum. That subsequent thereto he obtained a friendly loan of Kshs. 242, 500/= from the Appellant herein vide an agreement executed by Anwar & Company Advocates. The Respondent was then able to redeem his motor vehicle registration number KCC 106R Toyota Town Ace.
3. The Respondent averred that due to his close ties with the Appellant, he did, at the request of the latter, hand over the said motor vehicle to him for his use until 16th August 2022. The Respondent averred that since 17th August 2022, he has been pleading with the Appellant to surrender his motor vehicle registration number KCC 106R Toyota Town Ace and collect the money as advanced to the Respondent, to no avail. The Respondent further averred that said motor vehicle did not form part of the terms or collateral of the mutual loan agreement and that the Appellant was on the verge of wasting the same.
4. In response to the Plaint, the Appellant herein filed a Defence and Counter-claim wherein he averred that he entered into a sale agreement with the Respondent herein over motor vehicle registration number KCC 106R Toyota Town Ace for purchase price of Kshs. 380,000/= out of which Kshs. 339,964/= was paid to Platinum Credit Limited and an auctioneer at the prompt of the Respondent leaving a balance of Kshs. 40, 036/= which was paid after the Respondent had obtained his logbook from Platinum Credit Limited and when the transfer was made.
5. In response to the Defence and counter claim, the Respondent denied the averments and placed the Appellant to strict proof. He insisted that he was still the bona fide owner of the motor vehicle registration number KCC 106 R Toyota Town Ace and averred that he never consented to the repair and/or purchase of parts replaced on the motor vehicle by the Appellant herein wherefore he is not liable for the expenses incurred and that the Appellant failed to disclose the condition of the motor vehicle prior to the repairs by virtue of an inspection report and/or valuation report.
6. Both parties made their case at the trial Court and the Court rendered itself in the following terms:
“…The agreement produced is an agreement for loan. I don’t find any reason to doubt the evidence of the Plaintiff neither can I get any reason why the Plaintiff could lie against the Defendant, though the Defendant testified that he bought the vehicle from the Plaintiff, there was no agreement for sale of motor vehicle produced by the Defendant.
The only evidence that was produced is a loan agreement.
I find the Plaintiff’s evidence was not challenged and I find that the Plaintiff has proved his case on a balance of probabilities.
I find the evidence of the Defendant to be mere denial and/or admission and lacks in merit and substance.
I theus enter judgement in favourt of the Plaintiff and against the Defendant for the
a. Release of the motor vehicle KCC 106 R Toyota Town Ace to the Plaintiff.
b. The mesne profit was not proved
c. The Plaintiff also gets costs of the suit”
Appeal
7. The Appellant was aggrieved by the decision of the trial Magistrate and preferred the present appeal on (8) grounds: -
i. The learned magistrate erred in fact and in law in failing to appreciate that a contract for sale and or purchase of motor vehicle need not to be in writing.
ii. The learned magistrate erred in fact and in law in failing to give reasons why he chose to believe the evidence of the Respondent and disregarded the evidence of the Appellant and his witness.
iii. The learned magistrate erred in fact and in law in misapprehending the law and the facts of the case thereby arriving at a decision that is not supported by facts and evidence.
iv. The learned magistrate erred in fact and in law in failing to list down the issues for determination in the matter despite the same being mandatory in law and thus, the judgement does not pass muster.
v. The learned magistrate erred in fact and in law in failing to appreciate the evidence of the Appellant and that of his witness thereby arriving at a wrong finding.
vi. The learned magistrate erred in fact and in law in failing to determine the Appellant’s counterclaim which ought to be determined simultaneously with the Respondent’s claim.
vii. The learned magistrate erred in fact and in law in relying on extraneous factors and disregarding material factors thereby arriving at a wrong decision that is unsupported in law.
viii. The learned magistrate erred in fact and in law in failing to appreciate the gist of the evidence adduced and the dispute therein between the parties thereby reaching a decision that is unsupported by the evidence on record.
8. The Appellant prayed that the appeal herein be allowed; the trial Court’s judgment delivered on 20th December 2023, be set aside and be substituted with a judgement dismissing the said claim and instead this Court to allow the Appellant’s counterclaim and the Respondents be condemned to pay costs of this appeal.
9. The appeal was canvassed vide written submissions. The Respondent filed his submissions dated 16th June 2025, whereas the Appellant filed his submissions dated 26th February 2025.
The Appellant’s Submissions
10. In a nutshell, the Appellant submits on his 8 preferred grounds of appeal. According to him, the Law of Contract at Section 3 provides that contracts must be in writing and contract for sale and/or purchase of motor vehicle, as in this appeal, is not one of them and by virtue of the proof of existence of oral contract, the trial Court holding that there was no sale of agreement of motor vehicle by the Appellant was one made in error. He submits that there was an oral contract of sale and the same was witnessed by DW2 who gave evidence. He posits that by virtues of Section 3 of the Law of Contract Act, there is no mandatory requirement for agreements for sale of motor vehicle to be in writing and that the existence of one is inferred from the evidence of DW1 and DW2.
11. The Appellant submits that that the evidence of DW1 was duly corroborated by DW2 thus proving the existence of an oral agreement between the Appellant and the Respondent over the sale of the motor vehicle registration number KCC 106 R Toyota Town Ace but the trial Court chose to believe the evidence of the Respondent over that of the Appellant. He insisted that by virtue of Section 109 of the Evidence Act and the evidence as tendered by DW2 it was clear that the Appellant proved the existence of an oral sale agreement.
12. The Appellant submits that the judgement of the trial Court was contrary to the dints of Order 21 Rule 4 of the Civil Procedure Rules and the lack of outlined issues for determination in the judgment is prejudicial to the appellant as the judgment lacked details of its finding and what was considered prior to the arrival of the court’s findings.
13. The Appellant submits that the lack of determination of its counterclaim was vital as the same was aimed at completing the sale or in the alternative refunding the Appellant the monies paid to the Respondent as part of the purchase price. He urged this Court to find the trial Court failed to determine the Appellants counterclaim as it did the Respondent’s claim.
14. The Appellant urged this Court to find that the Appellant had availed evidence of the existence of an oral agreement for the purchase of motor vehicle registration number KCC 106 R Toyota Town Ace and that he had repaired the same extensively wherefore the trial Court should have ordered the Respondent to reimburse the Appellant all the monies paid towards the Respondent’s loan with M/S Platinum Credit and the auctioneer to redeem the vehicle. Respondent’s Submissions
15. Respondent submits that the only agreement he entered into with the Appellant herein was with regard to his advancement of a loan to a tune of Kshs. 242, 500/=. He maintains that there was no oral sale agreement of his motor vehicle registration number KCC 106 R Toyota Town Ace and/or any agreement for it’s repair. In addition, he submits that he repaid the loan agreement with the Appellant herein on 10th August 2022 and that he does not owe the Appellant herein the amount of Kshs. 339,964/= or any pending balance of Kshs. 40, 036/= as prayed in his counter claim or at all.
16. The Respondent submits that he entered into a friendly loan agreement on 10th August 2022 for a loan amount of Kshs. 242, 500/= in the presence of DW2 who was the sole witness and their friend and that the said agreement was executed before Mr. Anwar, advocate for the Appellant. According to him, the trial Court analyzed both documentary and oral evidence before it prior to making its determination. He urged this Court to uphold the trial Court’s holding and dismiss this appeal with costs to the Respondents.
Analysis & Determination
17. I have considered the appeal herein, the record of appeal and the respective parties’ written submission. Conscious of my duty as the first appellate Court, to reconsider the evidence, reassess it and make my own conclusions on the evidence, subject to the cardinal fact that I did not have the advantage singularly enjoyed by the trial Magistrate, of seeing and hearing the witnesses as they testified. (See Seascapes Ltd v. Development Finance Company of Kenya Ltd [2009] KLR, 384). I also remind myself that this Court will not normally interfere with a finding of fact by the trial Court unless it is based on no evidence or on a misapprehension of the evidence or the Magistrate is shown demonstrably to have acted on wrong principle in reaching the findings he did. (See Ephantus Mwangi & Another v Duncan Mwangi Wambugu [1982-88] 1 KAR 278).
18. Vide a Plaint dated 27th January 2023, the Respondent herein, filed the suit and sought judgment against the Appellant for the following orders as already disclosed in paragraph 1 hereinabove.
19. The Appellant, filed the defence and counter claim dated 24th April 2024, and sought judgment against the Respondent for the following orders: -
a. The Plaintiff be ordered to pay the Defendant the monies paid to Platinum Credit Limited and the Auctioneer to a tune of Kshs. 339,964/= together with interest thereon at commercial rate of 21% per annum.
b. The Plaintiff be ordered to refund the Defendant the monies used in repairing the vehicle totaling to Kshs. 250,000/= together with interest at Court rates.
c. Costs of the suit.
20. On the loan agreement between the Appellant and the Respondent, the Appellant bore the burden of proving his case and by extension proving that he only entered into a friendly loan agreement for the amount of Kshs.242,500/=. Section 107 of the Evidence Act describes the burden of proof as follows:-
1. Whoever desires any Court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts must prove that those facts exist.
2. When a person is bound to prove the existence of any fact it is said that the burden of proof lies on that person.
21. In the case of Mbuthia Macharia vs Annah Mutua Ndwiga & Another (2017) eKLR, the Court of Appeal stated that: -
“The legal burden is discharged by way of evidence, with the opposing party having a corresponding duty of adducing evidence in rebuttal. This constitutes evidential burden. Therefore, while both the legal and evidential burdens initially rested upon the appellant, the evidential burden may shift in the course of trial, depending on the evidence adduced.”
22. It was the evidence of PW1 that he borrowed Kshs. 242, 500/= from the Appellant herein and the terms were that he was to refund the money and the agreement was duly executed by M/S Anwar & Company Advocates on 10th August 2022. He also told the Court that on 16th August 2022, owing to his close ties to the Appellant herein, the latter borrowed his motor vehicle registration number KCC 106 R Toyota Town Ace for personal use only for that day and he duly acceded to the appellant’s request. He told the Court that from 17th August 2022, he had been pleading with the Appellant to surrender the motor vehicle and pick his money as advanced in the loan agreement but the Appellant declined so to do.
23. On cross-examination, he told the Court that he has known the Appellant herein for over 5 years and that he entered into an agreement with him for advancement of Kshs. 242, 500/= so as to redeem his motor vehicle registration number KCC 106 R Toyota Town Ace from attachment by Platinum Credit Limited. He told the Court that he cleared the debt with Platinum Credit Limited on 16th August 2022. Further that when he gave his motor vehicle to the Appellant herein, the same was in roadworthy condition and Appellant had not expressed any interest in purchasing the same from him. He told the Court that he paid the Auctioneer, Kshs. 8,640/= was paid by the Appellant herein. On 16th August 2022, when the motor vehicle was released to him. He maintained that he knew the condition of his car and was not aware that the same had been spray painted.
24. On re-examination, he reiterated that the Appellant herein gave the him a loan and that he was not aware that the Appellant had made some payments to Platinum Credit Limited. He told the Court that his motor vehicle registration number KCC 106 R Toyota Town Ace was used for business purposes and the Appellant never told him that the vehicle needed spray painting or new tyres. He maintained that he was the one who paid the auctioneer Kshs. 8, 640/= and that his friendly loan agreement was executed on 10th August 2022.
25. The Appellant herein who testified as DW1 told the Court that he knows the Respondent and that the motor vehicle registration number KCC 106 R Toyota Town Ace is registered in the Respondent’s name. He concurred that he advanced the Respondent herein Kshs. 242,500/= vide a friendly loan agreement.
26. DW2, John Njenga Mwangi, testified that he was acquainted to both the parties to this appeal and that he was the one who took the Respondent to the Appellant to secure the Kshs. 242,500/= friendly loan.
27. I have examined the parties exhibits namely: PEXH III and the DEXH I which is the friendly loan agreement indicating that the Appellant extended to the Respondent herein a loan of Kshs. 242,500/= and the Respondent was agreed to refund the same by 17th August 2022 and in default the loan amount attracts an interest at commercial rates of 21% per annum. The said document was duly witnessed by DW2 and executed by all the parties plus witness.
28. The burden of proof was with the Respondent and he discharge it by production as PEXH III the loan agreement which the parties duly executed. In the circumstances, I agree with the trial Court that there exists a valid friendly loan Agreement between the parties herein for Kshs. 242,500/=.
29. On the counterclaim and oral agreement, the Appellant in his evidence as DW1 testified that there was a sale agreement of the motor vehicle registration number KCC 106 R Toyota Town Ace but the same was simply oral and it was to be written after the Respondent secures his motor vehicle from Platinum Credit Limited.
30. DW2, John Njenga Mwangi, testified that the parties to this appeal had an agreement for sale of motor vehicle registration number KCC 106 R Toyota Town Ace but the same was oral.
31. The Respondent on the other hand denied the existence of such an agreement of sale of his motor vehicle registration number KCC 106 R Toyota Town Ace and he posted that the Appellant had only borrowed the said motor vehicle on 16th August 2022, for use limited to that day and when he did not return it he started to pursue him of the same on 17th August 2022. Other than merely stating that they had agreed on the sale of motor vehicle registration number KCC 106 R Toyota Town Ace to the Appellant, no iota evidence of any such sale of the said motor vehicle was adduced.
32. A car is a chattel personal, thus, the Sale of Goods Act applies to the alleged agreement of sale herein. The issues above will also be resolved through the said law. In particular, Section 14 of the Sale of Goods Act, Cap 31, Laws of Kenya, provides that:
“14. In a contract of sale, unless the circumstances of the contract are such as to show a different intention, there is—
(a) an implied condition on the part of the seller that in the case of a sale he has a right to sell the goods, and that in the case of an agreement to sell he will have a right to sell the goods at the time when the property is to pass;
(b) an implied warranty that the buyer shall have and enjoy quiet possession of the goods;
(c) an implied warranty that the goods shall be free from any charge or encumbrance in favour of any third party, not declared or known to the buyer before or at the time when the contract is made.”
33. The record of the subordinate court reveals that the Respondent herein had filed a Notice of Motion dated 27th January 2023, seeking orders of mandatory injunction to compel the Appellant to surrender the suit vehicle. The motor vehicle is registered in the name of Respondent herein. Given that the parties had executed the loan agreement before an advocate, it beats logic as to why they did not sign a sale agreement for the said motor vehicle. The explanation given by the Respondent on how the Appellant gained possession of his motor vehicle on 16th August 2022, is quite plausible and in tandem with the evidence adduced. The Appellant did not prove that the sum of Kshs. 242,500/= was paid to the Respondent by the Appellant on account of the oral sale agreement of motor vehicle registration number KCC 106 R Toyota Town Ace. In fact, evidence shows that the possession and repairs of the said motor vehicle were not done without the authority and consent of the Respondent herein. In light of this evidence I do find that the testimony of DW2 that he witnessed the oral agreement cannot be reconciled with the conduct of the parties herein who were initially minded of reducing a loan agreement into a written contract. The executed friendly loan agreement was explicit on how the Respondent was to pay back the advanced loan and none of the terms disclosed any intention of the parties to transfer ownership of the Respondent’s motor vehicle to the appellant. The Appellant did not prove that he had paid a sum of Kshs. 339,964/= to Platinum Credit Limited at the instance of the Respondent.
34. In the upshot, I find that the Appellant has not proved its counter claim on a balance of probabilities. Accordingly, I dismiss it.
35. On the balance, this Court dismisses the Appellant’s appeal. The order of the trial Court, compelling the Appellant to release the subject motor vehicle registration number KCC 106 R Toyota Town Ace to the Respondent is upheld.
36. Each party shall bear their own costs in this Appeal while the costs in the suit remain as awarded by the trial Court.
Orders accordingly.
Dated and delivered at Bungoma this 30th day of September 2025.
M.S.Shariff
Judge
In the presence of:
Anwar for the Appellant
Juma Waswa for the Respondent
Peter Machoni – Court Assistant.
'
IN THE HIGH COURT OF KENYA
AT BUNGOMA
CIVIL APPEAL NO. E008 OF 2024
DANIEL NJURU KARIUKI……………………………….…….APPELLANT
VERSUS
JAMES MUIGAI KARIUKI…………………….……………RESPONDENT
(Being an appeal against the judgement/decree of the Chief Magistrate’s Court at Bungoma (Hon. T.M. Olando-PM) delivered on 20th December 2023 in Bungoma CMCC No. E040 of 2023)
JUDGEMENT
1. The Respondent herein instituted a suit at the magistracy seeking the following orders:
a. Accumulated mense profit to be assessed by the Honourable Court.
b. Release of motor vehicle registration KCC 106R Toyota Town Ace to the Plaintiff.
c. Costs of the suit.
d. Interest.
e. Any other relief the Honourable Court deems fit and just to grant.
2. According to the Plaint dated 27th January 2023, the Respondent averred that he was the lawful owner of motor vehicle registration number KCC 106R Toyota Town Ace and that sometime in the month of June 2022 he used the motor vehicle as a collateral to obtain a loan of Kshs. 150,000/= plus interest and other incidentals totaling to Kshs. 242,500/= from Platinum Credit Limited. He averred that upon his default in servicing the loan, his said motor vehicle registration number KCC 106R Toyota Town Ace was attached to meet the remaining outstanding loan sum. That subsequent thereto he obtained a friendly loan of Kshs. 242, 500/= from the Appellant herein vide an agreement executed by Anwar & Company Advocates. The Respondent was then able to redeem his motor vehicle registration number KCC 106R Toyota Town Ace.
3. The Respondent averred that due to his close ties with the Appellant, he did, at the request of the latter, hand over the said motor vehicle to him for his use until 16th August 2022. The Respondent averred that since 17th August 2022, he has been pleading with the Appellant to surrender his motor vehicle registration number KCC 106R Toyota Town Ace and collect the money as advanced to the Respondent, to no avail. The Respondent further averred that said motor vehicle did not form part of the terms or collateral of the mutual loan agreement and that the Appellant was on the verge of wasting the same.
4. In response to the Plaint, the Appellant herein filed a Defence and Counter-claim wherein he averred that he entered into a sale agreement with the Respondent herein over motor vehicle registration number KCC 106R Toyota Town Ace for purchase price of Kshs. 380,000/= out of which Kshs. 339,964/= was paid to Platinum Credit Limited and an auctioneer at the prompt of the Respondent leaving a balance of Kshs. 40, 036/= which was paid after the Respondent had obtained his logbook from Platinum Credit Limited and when the transfer was made.
5. In response to the Defence and counter claim, the Respondent denied the averments and placed the Appellant to strict proof. He insisted that he was still the bona fide owner of the motor vehicle registration number KCC 106 R Toyota Town Ace and averred that he never consented to the repair and/or purchase of parts replaced on the motor vehicle by the Appellant herein wherefore he is not liable for the expenses incurred and that the Appellant failed to disclose the condition of the motor vehicle prior to the repairs by virtue of an inspection report and/or valuation report.
6. Both parties made their case at the trial Court and the Court rendered itself in the following terms:
“…The agreement produced is an agreement for loan. I don’t find any reason to doubt the evidence of the Plaintiff neither can I get any reason why the Plaintiff could lie against the Defendant, though the Defendant testified that he bought the vehicle from the Plaintiff, there was no agreement for sale of motor vehicle produced by the Defendant.
The only evidence that was produced is a loan agreement.
I find the Plaintiff’s evidence was not challenged and I find that the Plaintiff has proved his case on a balance of probabilities.
I find the evidence of the Defendant to be mere denial and/or admission and lacks in merit and substance.
I theus enter judgement in favourt of the Plaintiff and against the Defendant for the
a. Release of the motor vehicle KCC 106 R Toyota Town Ace to the Plaintiff.
b. The mesne profit was not proved
c. The Plaintiff also gets costs of the suit”
Appeal
7. The Appellant was aggrieved by the decision of the trial Magistrate and preferred the present appeal on (8) grounds: -
i. The learned magistrate erred in fact and in law in failing to appreciate that a contract for sale and or purchase of motor vehicle need not to be in writing.
ii. The learned magistrate erred in fact and in law in failing to give reasons why he chose to believe the evidence of the Respondent and disregarded the evidence of the Appellant and his witness.
iii. The learned magistrate erred in fact and in law in misapprehending the law and the facts of the case thereby arriving at a decision that is not supported by facts and evidence.
iv. The learned magistrate erred in fact and in law in failing to list down the issues for determination in the matter despite the same being mandatory in law and thus, the judgement does not pass muster.
v. The learned magistrate erred in fact and in law in failing to appreciate the evidence of the Appellant and that of his witness thereby arriving at a wrong finding.
vi. The learned magistrate erred in fact and in law in failing to determine the Appellant’s counterclaim which ought to be determined simultaneously with the Respondent’s claim.
vii. The learned magistrate erred in fact and in law in relying on extraneous factors and disregarding material factors thereby arriving at a wrong decision that is unsupported in law.
viii. The learned magistrate erred in fact and in law in failing to appreciate the gist of the evidence adduced and the dispute therein between the parties thereby reaching a decision that is unsupported by the evidence on record.
8. The Appellant prayed that the appeal herein be allowed; the trial Court’s judgment delivered on 20th December 2023, be set aside and be substituted with a judgement dismissing the said claim and instead this Court to allow the Appellant’s counterclaim and the Respondents be condemned to pay costs of this appeal.
9. The appeal was canvassed vide written submissions. The Respondent filed his submissions dated 16th June 2025, whereas the Appellant filed his submissions dated 26th February 2025.
The Appellant’s Submissions
10. In a nutshell, the Appellant submits on his 8 preferred grounds of appeal. According to him, the Law of Contract at Section 3 provides that contracts must be in writing and contract for sale and/or purchase of motor vehicle, as in this appeal, is not one of them and by virtue of the proof of existence of oral contract, the trial Court holding that there was no sale of agreement of motor vehicle by the Appellant was one made in error. He submits that there was an oral contract of sale and the same was witnessed by DW2 who gave evidence. He posits that by virtues of Section 3 of the Law of Contract Act, there is no mandatory requirement for agreements for sale of motor vehicle to be in writing and that the existence of one is inferred from the evidence of DW1 and DW2.
11. The Appellant submits that that the evidence of DW1 was duly corroborated by DW2 thus proving the existence of an oral agreement between the Appellant and the Respondent over the sale of the motor vehicle registration number KCC 106 R Toyota Town Ace but the trial Court chose to believe the evidence of the Respondent over that of the Appellant. He insisted that by virtue of Section 109 of the Evidence Act and the evidence as tendered by DW2 it was clear that the Appellant proved the existence of an oral sale agreement.
12. The Appellant submits that the judgement of the trial Court was contrary to the dints of Order 21 Rule 4 of the Civil Procedure Rules and the lack of outlined issues for determination in the judgment is prejudicial to the appellant as the judgment lacked details of its finding and what was considered prior to the arrival of the court’s findings.
13. The Appellant submits that the lack of determination of its counterclaim was vital as the same was aimed at completing the sale or in the alternative refunding the Appellant the monies paid to the Respondent as part of the purchase price. He urged this Court to find the trial Court failed to determine the Appellants counterclaim as it did the Respondent’s claim.
14. The Appellant urged this Court to find that the Appellant had availed evidence of the existence of an oral agreement for the purchase of motor vehicle registration number KCC 106 R Toyota Town Ace and that he had repaired the same extensively wherefore the trial Court should have ordered the Respondent to reimburse the Appellant all the monies paid towards the Respondent’s loan with M/S Platinum Credit and the auctioneer to redeem the vehicle. Respondent’s Submissions
15. Respondent submits that the only agreement he entered into with the Appellant herein was with regard to his advancement of a loan to a tune of Kshs. 242, 500/=. He maintains that there was no oral sale agreement of his motor vehicle registration number KCC 106 R Toyota Town Ace and/or any agreement for it’s repair. In addition, he submits that he repaid the loan agreement with the Appellant herein on 10th August 2022 and that he does not owe the Appellant herein the amount of Kshs. 339,964/= or any pending balance of Kshs. 40, 036/= as prayed in his counter claim or at all.
16. The Respondent submits that he entered into a friendly loan agreement on 10th August 2022 for a loan amount of Kshs. 242, 500/= in the presence of DW2 who was the sole witness and their friend and that the said agreement was executed before Mr. Anwar, advocate for the Appellant. According to him, the trial Court analyzed both documentary and oral evidence before it prior to making its determination. He urged this Court to uphold the trial Court’s holding and dismiss this appeal with costs to the Respondents.
Analysis & Determination
17. I have considered the appeal herein, the record of appeal and the respective parties’ written submission. Conscious of my duty as the first appellate Court, to reconsider the evidence, reassess it and make my own conclusions on the evidence, subject to the cardinal fact that I did not have the advantage singularly enjoyed by the trial Magistrate, of seeing and hearing the witnesses as they testified. (See Seascapes Ltd v. Development Finance Company of Kenya Ltd [2009] KLR, 384). I also remind myself that this Court will not normally interfere with a finding of fact by the trial Court unless it is based on no evidence or on a misapprehension of the evidence or the Magistrate is shown demonstrably to have acted on wrong principle in reaching the findings he did. (See Ephantus Mwangi & Another v Duncan Mwangi Wambugu [1982-88] 1 KAR 278).
18. Vide a Plaint dated 27th January 2023, the Respondent herein, filed the suit and sought judgment against the Appellant for the following orders as already disclosed in paragraph 1 hereinabove.
19. The Appellant, filed the defence and counter claim dated 24th April 2024, and sought judgment against the Respondent for the following orders: -
a. The Plaintiff be ordered to pay the Defendant the monies paid to Platinum Credit Limited and the Auctioneer to a tune of Kshs. 339,964/= together with interest thereon at commercial rate of 21% per annum.
b. The Plaintiff be ordered to refund the Defendant the monies used in repairing the vehicle totaling to Kshs. 250,000/= together with interest at Court rates.
c. Costs of the suit.
20. On the loan agreement between the Appellant and the Respondent, the Appellant bore the burden of proving his case and by extension proving that he only entered into a friendly loan agreement for the amount of Kshs.242,500/=. Section 107 of the Evidence Act describes the burden of proof as follows:-
1. Whoever desires any Court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts must prove that those facts exist.
2. When a person is bound to prove the existence of any fact it is said that the burden of proof lies on that person.
21. In the case of Mbuthia Macharia vs Annah Mutua Ndwiga & Another (2017) eKLR, the Court of Appeal stated that: -
“The legal burden is discharged by way of evidence, with the opposing party having a corresponding duty of adducing evidence in rebuttal. This constitutes evidential burden. Therefore, while both the legal and evidential burdens initially rested upon the appellant, the evidential burden may shift in the course of trial, depending on the evidence adduced.”
22. It was the evidence of PW1 that he borrowed Kshs. 242, 500/= from the Appellant herein and the terms were that he was to refund the money and the agreement was duly executed by M/S Anwar & Company Advocates on 10th August 2022. He also told the Court that on 16th August 2022, owing to his close ties to the Appellant herein, the latter borrowed his motor vehicle registration number KCC 106 R Toyota Town Ace for personal use only for that day and he duly acceded to the appellant’s request. He told the Court that from 17th August 2022, he had been pleading with the Appellant to surrender the motor vehicle and pick his money as advanced in the loan agreement but the Appellant declined so to do.
23. On cross-examination, he told the Court that he has known the Appellant herein for over 5 years and that he entered into an agreement with him for advancement of Kshs. 242, 500/= so as to redeem his motor vehicle registration number KCC 106 R Toyota Town Ace from attachment by Platinum Credit Limited. He told the Court that he cleared the debt with Platinum Credit Limited on 16th August 2022. Further that when he gave his motor vehicle to the Appellant herein, the same was in roadworthy condition and Appellant had not expressed any interest in purchasing the same from him. He told the Court that he paid the Auctioneer, Kshs. 8,640/= was paid by the Appellant herein. On 16th August 2022, when the motor vehicle was released to him. He maintained that he knew the condition of his car and was not aware that the same had been spray painted.
24. On re-examination, he reiterated that the Appellant herein gave the him a loan and that he was not aware that the Appellant had made some payments to Platinum Credit Limited. He told the Court that his motor vehicle registration number KCC 106 R Toyota Town Ace was used for business purposes and the Appellant never told him that the vehicle needed spray painting or new tyres. He maintained that he was the one who paid the auctioneer Kshs. 8, 640/= and that his friendly loan agreement was executed on 10th August 2022.
25. The Appellant herein who testified as DW1 told the Court that he knows the Respondent and that the motor vehicle registration number KCC 106 R Toyota Town Ace is registered in the Respondent’s name. He concurred that he advanced the Respondent herein Kshs. 242,500/= vide a friendly loan agreement.
26. DW2, John Njenga Mwangi, testified that he was acquainted to both the parties to this appeal and that he was the one who took the Respondent to the Appellant to secure the Kshs. 242,500/= friendly loan.
27. I have examined the parties exhibits namely: PEXH III and the DEXH I which is the friendly loan agreement indicating that the Appellant extended to the Respondent herein a loan of Kshs. 242,500/= and the Respondent was agreed to refund the same by 17th August 2022 and in default the loan amount attracts an interest at commercial rates of 21% per annum. The said document was duly witnessed by DW2 and executed by all the parties plus witness.
28. The burden of proof was with the Respondent and he discharge it by production as PEXH III the loan agreement which the parties duly executed. In the circumstances, I agree with the trial Court that there exists a valid friendly loan Agreement between the parties herein for Kshs. 242,500/=.
29. On the counterclaim and oral agreement, the Appellant in his evidence as DW1 testified that there was a sale agreement of the motor vehicle registration number KCC 106 R Toyota Town Ace but the same was simply oral and it was to be written after the Respondent secures his motor vehicle from Platinum Credit Limited.
30. DW2, John Njenga Mwangi, testified that the parties to this appeal had an agreement for sale of motor vehicle registration number KCC 106 R Toyota Town Ace but the same was oral.
31. The Respondent on the other hand denied the existence of such an agreement of sale of his motor vehicle registration number KCC 106 R Toyota Town Ace and he posted that the Appellant had only borrowed the said motor vehicle on 16th August 2022, for use limited to that day and when he did not return it he started to pursue him of the same on 17th August 2022. Other than merely stating that they had agreed on the sale of motor vehicle registration number KCC 106 R Toyota Town Ace to the Appellant, no iota evidence of any such sale of the said motor vehicle was adduced.
32. A car is a chattel personal, thus, the Sale of Goods Act applies to the alleged agreement of sale herein. The issues above will also be resolved through the said law. In particular, Section 14 of the Sale of Goods Act, Cap 31, Laws of Kenya, provides that:
“14. In a contract of sale, unless the circumstances of the contract are such as to show a different intention, there is—
(a) an implied condition on the part of the seller that in the case of a sale he has a right to sell the goods, and that in the case of an agreement to sell he will have a right to sell the goods at the time when the property is to pass;
(b) an implied warranty that the buyer shall have and enjoy quiet possession of the goods;
(c) an implied warranty that the goods shall be free from any charge or encumbrance in favour of any third party, not declared or known to the buyer before or at the time when the contract is made.”
33. The record of the subordinate court reveals that the Respondent herein had filed a Notice of Motion dated 27th January 2023, seeking orders of mandatory injunction to compel the Appellant to surrender the suit vehicle. The motor vehicle is registered in the name of Respondent herein. Given that the parties had executed the loan agreement before an advocate, it beats logic as to why they did not sign a sale agreement for the said motor vehicle. The explanation given by the Respondent on how the Appellant gained possession of his motor vehicle on 16th August 2022, is quite plausible and in tandem with the evidence adduced. The Appellant did not prove that the sum of Kshs. 242,500/= was paid to the Respondent by the Appellant on account of the oral sale agreement of motor vehicle registration number KCC 106 R Toyota Town Ace. In fact, evidence shows that the possession and repairs of the said motor vehicle were not done without the authority and consent of the Respondent herein. In light of this evidence I do find that the testimony of DW2 that he witnessed the oral agreement cannot be reconciled with the conduct of the parties herein who were initially minded of reducing a loan agreement into a written contract. The executed friendly loan agreement was explicit on how the Respondent was to pay back the advanced loan and none of the terms disclosed any intention of the parties to transfer ownership of the Respondent’s motor vehicle to the appellant. The Appellant did not prove that he had paid a sum of Kshs. 339,964/= to Platinum Credit Limited at the instance of the Respondent.
34. In the upshot, I find that the Appellant has not proved its counter claim on a balance of probabilities. Accordingly, I dismiss it.
35. On the balance, this Court dismisses the Appellant’s appeal. The order of the trial Court, compelling the Appellant to release the subject motor vehicle registration number KCC 106 R Toyota Town Ace to the Respondent is upheld.
36. Each party shall bear their own costs in this Appeal while the costs in the suit remain as awarded by the trial Court.
Orders accordingly.
Dated and delivered at Bungoma this 30th day of September 2025.
M.S.Shariff
Judge
In the presence of:
Anwar for the Appellant
Juma Waswa for the Respondent
Peter Machoni – Court Assistant.
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