(Being an appeal against the judgment and decree of Hon. Kiongo Kagenyo, Adjudicator delivered on 15th July 2024 in Milimani Small Claims Court SCCCOMM. CLAIM NO. E1234 of 2023)
1. This appeal arises from a judgment of the Small Claims Court (SCC) dated 15th July 2024 in which the court granted the respondent’s claim against the appellant for breach of contract for the appellant’s failure to pay KShs 856,600/= as the balance of the amount for services rendered by the respondent to the appellant.
2. It was not disputed before the SCC that the respondent provided interior design development and consultancy services for the respondent’s two pharmacy outlets, one at Riverside drive, and the other at Yaya Centre, Alta Towers both in Nairobi County. The contracts for each of the outlets were separately entered into, with the one for Riverside drive being on 31st March 2022 for KShs 2,206,000/= and the other at Yaya Centre on 21st April 2022 for KShs 1,900,000/= making a total of KShs 4,106,000/=.
3. According to the respondent, who was the Claimant before the SCC, for the Riverside works, site inspection for the completed works was done on 7th May 2022 and hand over on 31st May 2022 while for the Yaya Centre works site inspection was done on 19th June 2022 and hand over on 29th June 2022 and the appellant proceeded to occupy both premises on 31st May and 29th June respectively.
4. According to the respondent, there was no complaint raised by the appellant at the time of occupation over the manner of execution of the works by the respondent. However, the appellant failed to complete payment for the works as agreed. The appellant only paid KShs 3,250,000/= as at 17th June 2022 leaving a balance of KShs 856,000/= which it never paid thus leading to the claim before the SCC.
5. According to the appellant, the respondent failed to deliver on the contract as it had no intention and/or ability to do the same and therefore it was not entitled to the payment claimed or any at all. Its position was that the respondent failed to deliver to the appellant design works for the appellant’s approval before commencement of the works. It was the appellant’s further contention that the respondent was not skilled or well equipped to render the services it was contracted for and therefore rendered shoddy, unprofessional and substandard services and the appellant had to engage the services of a different contractor to carry out the works altogether. That demands to the appellant to provide requisite certificates, licences and/or approvals to confirm the qualifications of the respondent to undertake the works were not honored by the respondent.
6. Further that the respondent delayed the completion of the works and the appellant had to occupy the premises in the state they were to avert further losses due to existing leases for the premises.
7. The appellant stated that it raised these issues with the respondent at the site on 9th December 2022 where its officers pointed out the glaring defects in the works and it was agreed that the respondent would demolish the substandard works as pointed out and submit a better design to the appellant for approval before implementation, which the respondent never did.
8. It was therefore the appellant’s case before the SCC that the respondent was the one in breach of the contract and therefore frustrated and effectively terminated the same.
9. The terms of the contract, including the scope of works, amount payable, terms of payment were not disputed.
10. The case proceeded by way of the pleadings and witness statements filed by the parties under section 30 of the Small Claims Court Act (Cap. 10A) Laws of Kenya. Section 30 of the SCCA provides that:
S. 30. Subject to agreement of all parties to the proceedings, the Court may determine any claim and give such orders as it considers fit and just on the basis of documents and written submissions, statements or other submissions presented to the Court.
11. The learned Adjudicator found that the existence of the contract between the parties, the contractual sum of KShs 4,106,600/= and that the appellant had paid KShs 3,250,000/= were not in issue. The learned Adjudicator then considered the issues raised by the appellant that the contract was illegal and that the respondent delivered shoddy, unprofessional and substandard services to the respondent.
12. The learned Adjudicator appreciated that the court could not enforce an illegal contract. He considered the assertion by the appellant that the respondent was not registered. The learned Adjudicator found that the appellant had failed to prove that the respondent had misrepresented itself to the appellant at the time of entering into the contract and therefore the appellant had entered into the contract by mistake. The learned Adjudicator found that by failing to demand for registration certificates and qualifications from the respondent at the time of entering into the contract and only raising it as a defence to the claim was an afterthought. The learned Adjudicator found that the appellant had failed to make a counterclaim against the respondent over its allegations that the respondent had failed to deliver on the contract as per the standard expected and that it had incurred further costs for hiring a different contractor to carry out the works.
13. Upon analyzing the evidence and the submissions by the parties and considering the law and authorities the learned Adjudicator concluded that the respondent had delivered on its part of the bargain while the appellant had not and therefore it was in breach of the contract. The court therefore found that the respondent had proved its claim against the appellant to the required standard and he allowed the same with costs to the respondent.
14. The appellant was dissatisfied with the judgment and in the memorandum of appeal dated 10th January 2024 he raised the following grounds that:
a) the learned magistrate erred in fact and in law in the appreciation of the contested factual premises by the parties and the interpretation and appreciation of the material law and thus wrongly decided the dispute in favour of the respondent.
b) the learned magistrate erred in fact and in law by holding that the respondent delivered its part of the contract.
c) the learned magistrate erred in fact and in law by holding that the respondent (sic) was in breach of the terms of the contract on payment.
d) the learned magistrate erred in fact and in law by failing to appreciate that the respondent carried out shoddy unprofessional and substandard services which led to the appellant engaging another contractor to do all the works afresh hence occasioning immense losses to the appellant.
e) the learned magistrate erred in fact and in law by failing to appreciate that the respondent was unqualified to offer contractual services as set out in the contract entered with the appellant.
f) the learned magistrate erred in fact and in law by failing to appreciate that the respondent was not well skilled and equipped to render the services it was contracted for.
g) the learned magistrate erred in fact and in law by failing to appreciate that the contract between the parties was illegal and void ab initio courtesy of the respondent’s lack of qualifications and blatant contravention of the statute governing contractors and the National Construction Authority Act (Cap. 118) Laws of Kenya.
h) the learned magistrate erred in fact and in law by failing to take notice that the respondent presented before the court forged documents which action amounted to contempt of court and therefore contrary to section 15 of the National Construction Authority Act (Cap. 118) Laws of Kenya.
i) the learned magistrate erred in fact and in law by failing to appreciate that the appellant does not owe the respondent the demanded KShs 856,000/=.
15. The appellant therefore prays that the appeal be allowed and the judgment and finding of the learned magistrate upholding the statement of claim be set aside in its entirety, the award of the costs of the suit to the respondent be set aside and costs in the lower court and the appeal be awarded to the appellant and that this court may make any other or further orders as the justice of the case may demand or the court may deem fit
16. The appeal was disposed of by way of written submissions filed by learned counsels for the parties. The same are considered in the analysis that follows.
17. I have considered the grounds set out in the Memorandum of Appeal and the submissions by learned counsels for the parties. Both parties reduced the grounds of appeal above into six issues common to both of them for this court’s determination. However, considering the submissions all the issues revolve around one issue, that is, whether or not the respondent was registered with the National Construction Authority and the effect thereof. That is the point of law for this court’s determination.
18. As a preliminary issue for guidance to learned counsels for both parties, the SCC is presided over by an Adjudicator and not a magistrate. It is important to bear in mind the vital provisions of the SCCA in order to appreciate and always have at the back of the mind the spirit behind the creation of this very distinguished court because, otherwise it gets meshed up with the operations of the magistrate’s court and there it loses meaning as a different court from the magistrates’ court. In the Kenyan context, an Adjudicator is indeed a magistrate. However, while presiding over the SCC he removes the robes of a magistrate and wears the ordinary garment of an Adjudicator who in the spirit of the SCCA should come down to the level of the ordinary man on the streets in adjudicating the claims. The reasons are that the SCC is designed to be simple that is, without the strictures of formal procedure and strict evidentiary rules, fast and accessible. These reasons will come out clearer in the analysis and evaluation of the evidence that follows because the operations of the SCC must be distinguished from those of the magistrate’s court.
19. The appellant submits that the respondent made a fraudulent misrepresentation to it at the time of entering into the contract that it was qualified to carry out contractual works as per the contract when in fact it was not.
20. In response to that submission, the respondent the respondent terms the accusations of it being unregistered as untrue.
21. First, an appeal to this court from the SCC is on points of law only as provided for under section 38 of the SCC Act. So, the first issue for this court to consider is whether the grounds of appeal raised by the appellant are on points of law only. Therefore, the submission by learned counsels for the parties that this court has to analyze and reassess the evidence on record and reach its own findings on the facts is misplaced. From the provisions of the Act, it follows that this court cannot proceed with the case by way of a rehearing and re-evaluation of evidence as is the norm in other civil matters as required under the Civil Procedure Act and Rules.
22. Learned counsel for the parties would do well to refer and be guided by the Court of Appeal’s observation in the case of Independent Electoral and Boundaries Commission & another v Mule & 3 others [2014] KECA 890 (KLR) that:
“Those points in an appeal of the kind before us, being from an election court’s decision, are further circumscribed by Section 85A of the Elections Act which limits appeals to the Court of Appeal to matters of law only. It is therefore quite strange and improper that each of the seventeen grounds, without exception, commences with a standard expression “the judge erred in fact and law” or “the learned Judge erred in law and in fact.” Clearly the drafters of the memorandum did not have the legal provision in active contemplation. Had they done so, they would have found that by invoking factual errors, they were inviting jurisdictional objections to their entire appeal.”
23. Further exposition on this issue of an appeal based on points of law only is found in the case of M’Riungu v. Republic [1983] KLR 455, where the Court of Appeal stated thus:
“where a right of appeal is confined to question of law, an appellate court has loyalty to accept the findings of fact of the lower court(s) and resist the temptation to treat findings of fact as holdings of fact and law and it should not interfere with the decision of the trial court or the first appellate court unless it is apparent that on evidence, no reasonable tribunal could have reached that conclusion, which would be the same as holding that the decision is bad in law”.
24. Another important feature to bear in mind while considering the appeal is that section 32 of the SCC Act exempts the court’s proceedings from the rigid application of the standards of evidence applicable in other court proceedings and permits the court to include as evidence any material that it deems credible or trustworthy (emphasis by underlining supplied). It follows from this provision that it is largely upon the Adjudicator to determine the material to rely upon.
25. Section 32 of the Act provides that the strict evidentiary rules applicable in other courts are not wholly applied in the Small Claims Court. It further, provides that the Court may admit as evidence any oral or written testimony, record, or other material even though the same is not admissible as evidence in any other Court under the law of evidence (emphasis by underlining supplied). My understanding of this provision is that the Adjudicator has the discretion to admit evidence which may be helpful in establishing whether or not the claim is proved. This provision further limits the province of the appellate court to issues of law only as the appellate court would have no means to overturn the findings of fact by the trial court and substitute them with its own findings.
26. Therefore, the submissions by learned counsel for the appellant based on non-adherence by the trial court to the strict rules of evidence are also found to be misplaced. For instance, whether or not the trial court was entitled to rely on the documents presented by the respondent to establish that it was duly registered with the NCA was an issue of fact before the SCC.
27. Although the learned Adjudicator failed to correctly address himself to the issue raised by the appellant of whether or not the certificates of registration were forgeries, I find that there was no miscarriage of justice. The parties had presented before him conflicting evidence in the form of witness statements, with the respondent asserting that the certificates were genuine and the appellant that they were forgeries. Considering that the parties had waived their right to proceed in the case by way of calling witnesses to be cross-examined on the evidence tendered, including the documents produced as exhibits, the learned Adjudicator was not bound to apply the strict rules of evidence to determine admissibility and authenticity of those documents. I find that, provided that he had with him, other evidence upon which he could rely and he did rely what this court needs to determine is whether his decision was reasonable in the circumstances. I am satisfied that it was and there was no error of law on his part.
28. The issue of considering the facts before the trial court is further limited by the procedure applicable before the SCC which is unlike the procedure before the magistrates’ courts. Learned counsel for the respondent has made reference to various rules of procedure under the Civil Procedure Rules 2010 but I find that those are not applicable in the SCC.
29. Section 3 of the SCC Act on the guiding principles of the court provides inter alia that the court shall be guided by the principles of judicial authority prescribed under Article 159(2) of the Constitution and without prejudice to the same, the Court shall adopt such procedures as the Court deems appropriate to ensure fairness of process and simplicity of procedure (emphasis in bold supplied). The fairness of process is however reinforced under Part IV which is the substantive part that deals with procedure. Section 17 of the Act which falls under Part IV, it provides that:
S. 17. Subject to this Act and Rules, the Court shall have control of its own procedure in the determination of claims before it and, in the exercise of that control, the Court shall have regard to the principles of natural justice.
30. Therefore, the principles of natural justice rather than the technical procedural rules under the CPR take centre stage in a SCC hearing. In Justice Amraphael Mbogholi Msagha v. Chief Justice of the Republic of Kenya & 7 Others Nairobi HCMCA No. 1062 of 2004; [2006] 2 KLR 553; [2006] eKLR, the Court, in discussing the rules of natural justice, cited De Smith and Brazier, Constitutional and Administrative Law 6th Edition (Penguin United Kingdom: 1989) (pages 557-558) which states:
“The content of natural justice is therefore flexible and variable. All that is fundamentally demanded of the decision maker is that his decision in its own context be made with due regard for the affected parties’ interests and accordingly be reached without bias and after giving the party or parties a chance to put his or their case....”
31. In this case, there is no complaint that the appellant was not heard on his case. I have dealt with the issue of the SCC failing to determine the authenticity of the certificates produced by the respondent to sshow that he was duly registered, above.
32. Indeed, technicality of procedure and strict rules of evidence as apply in the magistrates’ court were excluded so that the Adjudicator could be able to achieve one of the main objectives of the court which is provided under section 34 of the Act on expeditious disposal of cases with quite onerous provisions that:
S. 34 (1) All proceedings before the Court on any particular day so far as is practicable shall be heard and determined on the same day or on a day to day basis until final determination of the matter which shall be within sixty days from the date of filing the claim.
(2) Judgment given in determination of any claim shall be delivered on the same day and in any event, not later than three (3) days from the date of the hearing.
(3) The Court may only adjourn the hearing of any matter under exceptional and unforeseen circumstances which shall be recorded and be limited to a maximum of three adjournments.
33. While proceeding under the CPR and applying the strict rules of evidence, before the magistrate’s court, it is practically impossible to hear and determine every case that comes before it in a day’s sitting. It is only through strict compliance with the provisions of the SCCA with the exclusion of the strict evidentiary rules and technicalities of procedure under the CPR through adoption of a flexible procedure by the learned Adjudicator that this can be achieved.
34. Therefore, the complaint by the appellant that the learned Adjudicator failed to evaluate the evidence in probably a lengthy judgment as the appellant would have wished has no basis. The learned Adjudicator stated that he had considered the pleadings, documents, witness statements and submissions by the parties and made an analysis of the evidence presented. He cannot be faulted for not writing a long-winding judgment.
35. There is no requirement for the learned Adjudicator to prepare a lengthy decision under the SCC Act as is the case under the Civil Procedure Rules. Rule 23(4) of the SCC Rules provides that at the end of the hearing, the Court shall prepare a written record of its decision in final determination of the claims before it and (a) pronounce its decision in accordance with section 34(2) of the Act; or (b) send a copy of its written decision to the parties. This is in contrast to Order 21 Rule 4 of the Civil Procedure Rules which provides that “Judgement in defended suits shall contain a concise statement of the case, the points for determination, the decision thereon and the reasons for such decision.” The claim could only be and a determination made as provided for under the SCC Act.
36. Turning back to the issue raised by the appellant that the respondent was not duly registered under the NCA Act as a contractor and therefore could not legally enter into the contract with the appellant, sections 15 and 16 of the NCA Act provide for the registration of contractors under the Act as follows:
15. Requirement for registration.
(1) A person shall not carry on the business of a contractor unless the person is registered by the Board under this Act.
(2) ...
16. Meaning of "Contractor".
(1) For the purposes of this Act, a person carries on business as a contractor where such person, for reward or other valuable consideration, undertakes the construction, installation or erection, for any other person, of any structure situated below, on or above the ground, or other work connected therewith, or the execution, for any other person, of any alteration or otherwise to any structure or other work connected therewith, and undertakes to supply—
(a) the materials necessary for the work, or is authorized to exercise control over the type, quality or use of the materials supplied by any other person;
(b) the labour necessary for the work, or is authorized on behalf of the person for whom the work is undertaken or any other person, to employ or select workmen for employment for the purposes of the execution of the work, whether under a contract of service or otherwise:
Provided that a person shall not be deemed to be a contractor if the work undertaken—
(i) does not incur a cost exceeding such sum or sums as the Board may from time to time determine; or
(ii) consists of a residential house for private use, not requiring a structural design.
(2) The Board shall register eligible contractors to undertake any of the classes of contracted works set out in the Third Schedule depending on their knowledge and experience.
(3) The Cabinet Secretary may by notice in the Gazette amend the Third Schedule.
37. It follows from these provisions that a person who is not registered by the Board under the Act and further if the works being undertaken do not fall within the proviso to section 16(1) of the Act then the person cannot enter into a contract under the Act. Any contract entered into by that party under the Act is illegal and therefore void ab initio.
38. This position has been held to be so in various authorities as cited in the case of Kenya Airways Limited v Flora [2013] KECA 545 (KLR) cited by learned counsel for the appellant. For instance, in Mapis Investment (K) Ltd v Kenya Railways Corporation [2005] KECA 358 (KLR) the Court of Appeal citing the decision of the Privy Council in Mistry Amar Singh v. Serwano Wofunira Kulubya, [1963] EA 408 on appeal from a judgment and order of the East African Court of Appeal at page 414 of the report where in his speech Lord Morris of Borth -y- Guest quoted with approval the following passage from the judgment in Scott v. Brown, Doering, McNab & Co (3), [1892] 2 QB 724 Lindley LJ at p.728:
“Ex turpi causa non oritur actio. This old and well known legal maxim is founded in good sense, and expresses a clear and well recognised legal principle, which is not confined to indictable offences. No court ought to enforce an illegal contract or allow itself to be made the instrument of enforcing obligations alleged to arise out of a contract or transaction which is illegal, if the illegality is duly brought to the notice of the court, and if the person invoking the aid of the court is himself implicated in the illegality. It matters not whether the defendant has pleaded the illegality or whether he has not. If the evidence adduced by the plaintiff proves the illegality the court ought not to assist him.”
39. Further the Court of Appeal, dealing with an issue of illegality of contract had expressed itself as follows in the case of PATEL V SINGH (No 2) [1987] KLR 585 at 588, relying on the words of Devlin L.J (as he then was), in ARCHBOLDS (FREIGHTAGE) LTD V S. SPANGLETT LTD [1961] I QB 374 at 388 reiterated:
“The effect of illegality upon a contract may be threefold. If at the time of making the contract there is an intent to perform it in an unlawful way, the contract, although it remains alive, is unenforceable at the suit of the party having that intent; if the intent is held in common, it is not enforceable at all. Another effect of illegality is to prevent a plaintiff from recovering under a contract if in order to prove his rights under it he has to rely upon his own illegal act; he may not do that even though he can show that at the time of making the contract he had no intent to break the law and that as the time of performance he did not know what he was doing was illegal. The third effect of illegality is to avoid the contract ab initio and that arises if the making of the contract is expressly or impliedly prohibited by statute or is otherwise contrary to public policy.”
40. It follows from these decisions that if established to be true that the respondent was required to but was not registered under the Act in order to undertake the works the subject of the contract between the parties, it would render the same unenforceable meaning the respondent could not claim upon it as was the case before the SCC.
41. In its submissions, the appellant tries to wriggle out of the fact that it undertook the works as a contractor by directing the issue to the title of the contract rather than the works undertaken. After stating that the appellant had erroneously in its submissions attempted to rewrite and recreate the ambit of the contracts by naming them as “Interior Design and Contracting Works,” instead of what they actually were to, “To Provide Interior Design Development & Consultancy Services for the Clients Pharmacy Outlet” by posing a question *of how the appellant made severed Contractual Works from Consultancy Services and stating that one does not need to be a contractor to offer interior design and consultancy services. However, the issue is not in the name of the project but in the works executed and I am satisfied from the scope of works, that the work fell within the definition of contractor under subsection 1 of section 16 where it provides that:
“For the purposes of this Act, a person carries on business as a contractor where such person, for reward or other valuable consideration, undertakes ... or the execution, for any other person, of any alteration or otherwise to any structure or other work connected therewith, and undertakes to supply ...”
42. The works undertaken by the respondent would fall particularly under the provision of “undertakes ... other work connected therewith...” and so fit in the definition of contractor in that section.
43. However, the definition has an exception that a person shall not be deemed to be a contractor if the work undertaken does not incur a cost exceeding such sum or sums as the Board may from time to time determine. I note that in its submissions, the appellant has not made reference to the proviso to section 16(1) of the Act.
44. Since the appellant was the one asserting that the respondent was not duly registered, under section 109 of the Evidence Act (Cap. 80) Laws of Kenya, the onus was upon the appellant to show that the works contracted between them did not fall within this proviso and therefore that the respondent was required to be registered under the Act. Section 109 of the Evidence Act provides that the burden of proof as to any particular fact lies on the person who wishes the court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on any particular person.
45. I find from the evidence on record that the appellant did not provide any such evidence. Consequently, its assertion that the respondent was disqualified under the Act from contracting for the works it undertook for the appellant and that the contract was therefore illegal and void ab initio was not established.
46. I am satisfied and I find that even though without making reference to the provisions of the NCA Act with respect to registration of contractors, learned Adjudicator, though reasoning differently, arrived at the correct decision that the appellant was in breach of contract with the respondent and was liable to pay the respondent KShs 856,000/= as the balance of the cost of services rendered to the appellant.
47. Consequently, I find that the appeal has no merit and the same is dismissed. The judgment of the trial court is affirmed.
48. The respondent shall get the costs of this appeal.
49. Orders accordingly.
50. Delivered, dated and signed on the Virtual Platform, Teams this 12th day of March 2026 and uploaded on the CTS for access by parties.
ANDAYI W. F.
JUDGE
In the presence of:
N/A for the Appellant.
Kathure (Ms) h/b for Orenge for the Respondent.
Ummu h/b for Aminaa: Court Assistant.
1. This appeal arises from a judgment of the Small Claims Court (SCC) dated 15th July 2024 in which the court granted the respondent’s claim against the appellant for breach of contract for the appellant’s failure to pay KShs 856,600/= as the balance of the amount for services rendered by the respondent to the appellant.
2. It was not disputed before the SCC that the respondent provided interior design development and consultancy services for the respondent’s two pharmacy outlets, one at Riverside drive, and the other at Yaya Centre, Alta Towers both in Nairobi County. The contracts for each of the outlets were separately entered into, with the one for Riverside drive being on 31st March 2022 for KShs 2,206,000/= and the other at Yaya Centre on 21st April 2022 for KShs 1,900,000/= making a total of KShs 4,106,000/=.
3. According to the respondent, who was the Claimant before the SCC, for the Riverside works, site inspection for the completed works was done on 7th May 2022 and hand over on 31st May 2022 while for the Yaya Centre works site inspection was done on 19th June 2022 and hand over on 29th June 2022 and the appellant proceeded to occupy both premises on 31st May and 29th June respectively.
4. According to the respondent, there was no complaint raised by the appellant at the time of occupation over the manner of execution of the works by the respondent. However, the appellant failed to complete payment for the works as agreed. The appellant only paid KShs 3,250,000/= as at 17th June 2022 leaving a balance of KShs 856,000/= which it never paid thus leading to the claim before the SCC.
5. According to the appellant, the respondent failed to deliver on the contract as it had no intention and/or ability to do the same and therefore it was not entitled to the payment claimed or any at all. Its position was that the respondent failed to deliver to the appellant design works for the appellant’s approval before commencement of the works. It was the appellant’s further contention that the respondent was not skilled or well equipped to render the services it was contracted for and therefore rendered shoddy, unprofessional and substandard services and the appellant had to engage the services of a different contractor to carry out the works altogether. That demands to the appellant to provide requisite certificates, licences and/or approvals to confirm the qualifications of the respondent to undertake the works were not honored by the respondent.
6. Further that the respondent delayed the completion of the works and the appellant had to occupy the premises in the state they were to avert further losses due to existing leases for the premises.
7. The appellant stated that it raised these issues with the respondent at the site on 9th December 2022 where its officers pointed out the glaring defects in the works and it was agreed that the respondent would demolish the substandard works as pointed out and submit a better design to the appellant for approval before implementation, which the respondent never did.
8. It was therefore the appellant’s case before the SCC that the respondent was the one in breach of the contract and therefore frustrated and effectively terminated the same.
9. The terms of the contract, including the scope of works, amount payable, terms of payment were not disputed.
10. The case proceeded by way of the pleadings and witness statements filed by the parties under section 30 of the Small Claims Court Act (Cap. 10A) Laws of Kenya. Section 30 of the SCCA provides that:
S. 30. Subject to agreement of all parties to the proceedings, the Court may determine any claim and give such orders as it considers fit and just on the basis of documents and written submissions, statements or other submissions presented to the Court.
11. The learned Adjudicator found that the existence of the contract between the parties, the contractual sum of KShs 4,106,600/= and that the appellant had paid KShs 3,250,000/= were not in issue. The learned Adjudicator then considered the issues raised by the appellant that the contract was illegal and that the respondent delivered shoddy, unprofessional and substandard services to the respondent.
12. The learned Adjudicator appreciated that the court could not enforce an illegal contract. He considered the assertion by the appellant that the respondent was not registered. The learned Adjudicator found that the appellant had failed to prove that the respondent had misrepresented itself to the appellant at the time of entering into the contract and therefore the appellant had entered into the contract by mistake. The learned Adjudicator found that by failing to demand for registration certificates and qualifications from the respondent at the time of entering into the contract and only raising it as a defence to the claim was an afterthought. The learned Adjudicator found that the appellant had failed to make a counterclaim against the respondent over its allegations that the respondent had failed to deliver on the contract as per the standard expected and that it had incurred further costs for hiring a different contractor to carry out the works.
13. Upon analyzing the evidence and the submissions by the parties and considering the law and authorities the learned Adjudicator concluded that the respondent had delivered on its part of the bargain while the appellant had not and therefore it was in breach of the contract. The court therefore found that the respondent had proved its claim against the appellant to the required standard and he allowed the same with costs to the respondent.
14. The appellant was dissatisfied with the judgment and in the memorandum of appeal dated 10th January 2024 he raised the following grounds that:
a) the learned magistrate erred in fact and in law in the appreciation of the contested factual premises by the parties and the interpretation and appreciation of the material law and thus wrongly decided the dispute in favour of the respondent.
b) the learned magistrate erred in fact and in law by holding that the respondent delivered its part of the contract.
c) the learned magistrate erred in fact and in law by holding that the respondent (sic) was in breach of the terms of the contract on payment.
d) the learned magistrate erred in fact and in law by failing to appreciate that the respondent carried out shoddy unprofessional and substandard services which led to the appellant engaging another contractor to do all the works afresh hence occasioning immense losses to the appellant.
e) the learned magistrate erred in fact and in law by failing to appreciate that the respondent was unqualified to offer contractual services as set out in the contract entered with the appellant.
f) the learned magistrate erred in fact and in law by failing to appreciate that the respondent was not well skilled and equipped to render the services it was contracted for.
g) the learned magistrate erred in fact and in law by failing to appreciate that the contract between the parties was illegal and void ab initio courtesy of the respondent’s lack of qualifications and blatant contravention of the statute governing contractors and the National Construction Authority Act (Cap. 118) Laws of Kenya.
h) the learned magistrate erred in fact and in law by failing to take notice that the respondent presented before the court forged documents which action amounted to contempt of court and therefore contrary to section 15 of the National Construction Authority Act (Cap. 118) Laws of Kenya.
i) the learned magistrate erred in fact and in law by failing to appreciate that the appellant does not owe the respondent the demanded KShs 856,000/=.
15. The appellant therefore prays that the appeal be allowed and the judgment and finding of the learned magistrate upholding the statement of claim be set aside in its entirety, the award of the costs of the suit to the respondent be set aside and costs in the lower court and the appeal be awarded to the appellant and that this court may make any other or further orders as the justice of the case may demand or the court may deem fit
16. The appeal was disposed of by way of written submissions filed by learned counsels for the parties. The same are considered in the analysis that follows.
17. I have considered the grounds set out in the Memorandum of Appeal and the submissions by learned counsels for the parties. Both parties reduced the grounds of appeal above into six issues common to both of them for this court’s determination. However, considering the submissions all the issues revolve around one issue, that is, whether or not the respondent was registered with the National Construction Authority and the effect thereof. That is the point of law for this court’s determination.
18. As a preliminary issue for guidance to learned counsels for both parties, the SCC is presided over by an Adjudicator and not a magistrate. It is important to bear in mind the vital provisions of the SCCA in order to appreciate and always have at the back of the mind the spirit behind the creation of this very distinguished court because, otherwise it gets meshed up with the operations of the magistrate’s court and there it loses meaning as a different court from the magistrates’ court. In the Kenyan context, an Adjudicator is indeed a magistrate. However, while presiding over the SCC he removes the robes of a magistrate and wears the ordinary garment of an Adjudicator who in the spirit of the SCCA should come down to the level of the ordinary man on the streets in adjudicating the claims. The reasons are that the SCC is designed to be simple that is, without the strictures of formal procedure and strict evidentiary rules, fast and accessible. These reasons will come out clearer in the analysis and evaluation of the evidence that follows because the operations of the SCC must be distinguished from those of the magistrate’s court.
19. The appellant submits that the respondent made a fraudulent misrepresentation to it at the time of entering into the contract that it was qualified to carry out contractual works as per the contract when in fact it was not.
20. In response to that submission, the respondent the respondent terms the accusations of it being unregistered as untrue.
21. First, an appeal to this court from the SCC is on points of law only as provided for under section 38 of the SCC Act. So, the first issue for this court to consider is whether the grounds of appeal raised by the appellant are on points of law only. Therefore, the submission by learned counsels for the parties that this court has to analyze and reassess the evidence on record and reach its own findings on the facts is misplaced. From the provisions of the Act, it follows that this court cannot proceed with the case by way of a rehearing and re-evaluation of evidence as is the norm in other civil matters as required under the Civil Procedure Act and Rules.
22. Learned counsel for the parties would do well to refer and be guided by the Court of Appeal’s observation in the case of Independent Electoral and Boundaries Commission & another v Mule & 3 others [2014] KECA 890 (KLR) that:
“Those points in an appeal of the kind before us, being from an election court’s decision, are further circumscribed by Section 85A of the Elections Act which limits appeals to the Court of Appeal to matters of law only. It is therefore quite strange and improper that each of the seventeen grounds, without exception, commences with a standard expression “the judge erred in fact and law” or “the learned Judge erred in law and in fact.” Clearly the drafters of the memorandum did not have the legal provision in active contemplation. Had they done so, they would have found that by invoking factual errors, they were inviting jurisdictional objections to their entire appeal.”
23. Further exposition on this issue of an appeal based on points of law only is found in the case of M’Riungu v. Republic [1983] KLR 455, where the Court of Appeal stated thus:
“where a right of appeal is confined to question of law, an appellate court has loyalty to accept the findings of fact of the lower court(s) and resist the temptation to treat findings of fact as holdings of fact and law and it should not interfere with the decision of the trial court or the first appellate court unless it is apparent that on evidence, no reasonable tribunal could have reached that conclusion, which would be the same as holding that the decision is bad in law”.
24. Another important feature to bear in mind while considering the appeal is that section 32 of the SCC Act exempts the court’s proceedings from the rigid application of the standards of evidence applicable in other court proceedings and permits the court to include as evidence any material that it deems credible or trustworthy (emphasis by underlining supplied). It follows from this provision that it is largely upon the Adjudicator to determine the material to rely upon.
25. Section 32 of the Act provides that the strict evidentiary rules applicable in other courts are not wholly applied in the Small Claims Court. It further, provides that the Court may admit as evidence any oral or written testimony, record, or other material even though the same is not admissible as evidence in any other Court under the law of evidence (emphasis by underlining supplied). My understanding of this provision is that the Adjudicator has the discretion to admit evidence which may be helpful in establishing whether or not the claim is proved. This provision further limits the province of the appellate court to issues of law only as the appellate court would have no means to overturn the findings of fact by the trial court and substitute them with its own findings.
26. Therefore, the submissions by learned counsel for the appellant based on non-adherence by the trial court to the strict rules of evidence are also found to be misplaced. For instance, whether or not the trial court was entitled to rely on the documents presented by the respondent to establish that it was duly registered with the NCA was an issue of fact before the SCC.
27. Although the learned Adjudicator failed to correctly address himself to the issue raised by the appellant of whether or not the certificates of registration were forgeries, I find that there was no miscarriage of justice. The parties had presented before him conflicting evidence in the form of witness statements, with the respondent asserting that the certificates were genuine and the appellant that they were forgeries. Considering that the parties had waived their right to proceed in the case by way of calling witnesses to be cross-examined on the evidence tendered, including the documents produced as exhibits, the learned Adjudicator was not bound to apply the strict rules of evidence to determine admissibility and authenticity of those documents. I find that, provided that he had with him, other evidence upon which he could rely and he did rely what this court needs to determine is whether his decision was reasonable in the circumstances. I am satisfied that it was and there was no error of law on his part.
28. The issue of considering the facts before the trial court is further limited by the procedure applicable before the SCC which is unlike the procedure before the magistrates’ courts. Learned counsel for the respondent has made reference to various rules of procedure under the Civil Procedure Rules 2010 but I find that those are not applicable in the SCC.
29. Section 3 of the SCC Act on the guiding principles of the court provides inter alia that the court shall be guided by the principles of judicial authority prescribed under Article 159(2) of the Constitution and without prejudice to the same, the Court shall adopt such procedures as the Court deems appropriate to ensure fairness of process and simplicity of procedure (emphasis in bold supplied). The fairness of process is however reinforced under Part IV which is the substantive part that deals with procedure. Section 17 of the Act which falls under Part IV, it provides that:
S. 17. Subject to this Act and Rules, the Court shall have control of its own procedure in the determination of claims before it and, in the exercise of that control, the Court shall have regard to the principles of natural justice.
30. Therefore, the principles of natural justice rather than the technical procedural rules under the CPR take centre stage in a SCC hearing. In Justice Amraphael Mbogholi Msagha v. Chief Justice of the Republic of Kenya & 7 Others Nairobi HCMCA No. 1062 of 2004; [2006] 2 KLR 553; [2006] eKLR, the Court, in discussing the rules of natural justice, cited De Smith and Brazier, Constitutional and Administrative Law 6th Edition (Penguin United Kingdom: 1989) (pages 557-558) which states:
“The content of natural justice is therefore flexible and variable. All that is fundamentally demanded of the decision maker is that his decision in its own context be made with due regard for the affected parties’ interests and accordingly be reached without bias and after giving the party or parties a chance to put his or their case....”
31. In this case, there is no complaint that the appellant was not heard on his case. I have dealt with the issue of the SCC failing to determine the authenticity of the certificates produced by the respondent to sshow that he was duly registered, above.
32. Indeed, technicality of procedure and strict rules of evidence as apply in the magistrates’ court were excluded so that the Adjudicator could be able to achieve one of the main objectives of the court which is provided under section 34 of the Act on expeditious disposal of cases with quite onerous provisions that:
S. 34 (1) All proceedings before the Court on any particular day so far as is practicable shall be heard and determined on the same day or on a day to day basis until final determination of the matter which shall be within sixty days from the date of filing the claim.
(2) Judgment given in determination of any claim shall be delivered on the same day and in any event, not later than three (3) days from the date of the hearing.
(3) The Court may only adjourn the hearing of any matter under exceptional and unforeseen circumstances which shall be recorded and be limited to a maximum of three adjournments.
33. While proceeding under the CPR and applying the strict rules of evidence, before the magistrate’s court, it is practically impossible to hear and determine every case that comes before it in a day’s sitting. It is only through strict compliance with the provisions of the SCCA with the exclusion of the strict evidentiary rules and technicalities of procedure under the CPR through adoption of a flexible procedure by the learned Adjudicator that this can be achieved.
34. Therefore, the complaint by the appellant that the learned Adjudicator failed to evaluate the evidence in probably a lengthy judgment as the appellant would have wished has no basis. The learned Adjudicator stated that he had considered the pleadings, documents, witness statements and submissions by the parties and made an analysis of the evidence presented. He cannot be faulted for not writing a long-winding judgment.
35. There is no requirement for the learned Adjudicator to prepare a lengthy decision under the SCC Act as is the case under the Civil Procedure Rules. Rule 23(4) of the SCC Rules provides that at the end of the hearing, the Court shall prepare a written record of its decision in final determination of the claims before it and (a) pronounce its decision in accordance with section 34(2) of the Act; or (b) send a copy of its written decision to the parties. This is in contrast to Order 21 Rule 4 of the Civil Procedure Rules which provides that “Judgement in defended suits shall contain a concise statement of the case, the points for determination, the decision thereon and the reasons for such decision.” The claim could only be and a determination made as provided for under the SCC Act.
36. Turning back to the issue raised by the appellant that the respondent was not duly registered under the NCA Act as a contractor and therefore could not legally enter into the contract with the appellant, sections 15 and 16 of the NCA Act provide for the registration of contractors under the Act as follows:
15. Requirement for registration.
(1) A person shall not carry on the business of a contractor unless the person is registered by the Board under this Act.
(2) ...
16. Meaning of "Contractor".
(1) For the purposes of this Act, a person carries on business as a contractor where such person, for reward or other valuable consideration, undertakes the construction, installation or erection, for any other person, of any structure situated below, on or above the ground, or other work connected therewith, or the execution, for any other person, of any alteration or otherwise to any structure or other work connected therewith, and undertakes to supply—
(a) the materials necessary for the work, or is authorized to exercise control over the type, quality or use of the materials supplied by any other person;
(b) the labour necessary for the work, or is authorized on behalf of the person for whom the work is undertaken or any other person, to employ or select workmen for employment for the purposes of the execution of the work, whether under a contract of service or otherwise:
Provided that a person shall not be deemed to be a contractor if the work undertaken—
(i) does not incur a cost exceeding such sum or sums as the Board may from time to time determine; or
(ii) consists of a residential house for private use, not requiring a structural design.
(2) The Board shall register eligible contractors to undertake any of the classes of contracted works set out in the Third Schedule depending on their knowledge and experience.
(3) The Cabinet Secretary may by notice in the Gazette amend the Third Schedule.
37. It follows from these provisions that a person who is not registered by the Board under the Act and further if the works being undertaken do not fall within the proviso to section 16(1) of the Act then the person cannot enter into a contract under the Act. Any contract entered into by that party under the Act is illegal and therefore void ab initio.
38. This position has been held to be so in various authorities as cited in the case of Kenya Airways Limited v Flora [2013] KECA 545 (KLR) cited by learned counsel for the appellant. For instance, in Mapis Investment (K) Ltd v Kenya Railways Corporation [2005] KECA 358 (KLR) the Court of Appeal citing the decision of the Privy Council in Mistry Amar Singh v. Serwano Wofunira Kulubya, [1963] EA 408 on appeal from a judgment and order of the East African Court of Appeal at page 414 of the report where in his speech Lord Morris of Borth -y- Guest quoted with approval the following passage from the judgment in Scott v. Brown, Doering, McNab & Co (3), [1892] 2 QB 724 Lindley LJ at p.728:
“Ex turpi causa non oritur actio. This old and well known legal maxim is founded in good sense, and expresses a clear and well recognised legal principle, which is not confined to indictable offences. No court ought to enforce an illegal contract or allow itself to be made the instrument of enforcing obligations alleged to arise out of a contract or transaction which is illegal, if the illegality is duly brought to the notice of the court, and if the person invoking the aid of the court is himself implicated in the illegality. It matters not whether the defendant has pleaded the illegality or whether he has not. If the evidence adduced by the plaintiff proves the illegality the court ought not to assist him.”
39. Further the Court of Appeal, dealing with an issue of illegality of contract had expressed itself as follows in the case of PATEL V SINGH (No 2) [1987] KLR 585 at 588, relying on the words of Devlin L.J (as he then was), in ARCHBOLDS (FREIGHTAGE) LTD V S. SPANGLETT LTD [1961] I QB 374 at 388 reiterated:
“The effect of illegality upon a contract may be threefold. If at the time of making the contract there is an intent to perform it in an unlawful way, the contract, although it remains alive, is unenforceable at the suit of the party having that intent; if the intent is held in common, it is not enforceable at all. Another effect of illegality is to prevent a plaintiff from recovering under a contract if in order to prove his rights under it he has to rely upon his own illegal act; he may not do that even though he can show that at the time of making the contract he had no intent to break the law and that as the time of performance he did not know what he was doing was illegal. The third effect of illegality is to avoid the contract ab initio and that arises if the making of the contract is expressly or impliedly prohibited by statute or is otherwise contrary to public policy.”
40. It follows from these decisions that if established to be true that the respondent was required to but was not registered under the Act in order to undertake the works the subject of the contract between the parties, it would render the same unenforceable meaning the respondent could not claim upon it as was the case before the SCC.
41. In its submissions, the appellant tries to wriggle out of the fact that it undertook the works as a contractor by directing the issue to the title of the contract rather than the works undertaken. After stating that the appellant had erroneously in its submissions attempted to rewrite and recreate the ambit of the contracts by naming them as “Interior Design and Contracting Works,” instead of what they actually were to, “To Provide Interior Design Development & Consultancy Services for the Clients Pharmacy Outlet” by posing a question *of how the appellant made severed Contractual Works from Consultancy Services and stating that one does not need to be a contractor to offer interior design and consultancy services. However, the issue is not in the name of the project but in the works executed and I am satisfied from the scope of works, that the work fell within the definition of contractor under subsection 1 of section 16 where it provides that:
“For the purposes of this Act, a person carries on business as a contractor where such person, for reward or other valuable consideration, undertakes ... or the execution, for any other person, of any alteration or otherwise to any structure or other work connected therewith, and undertakes to supply ...”
42. The works undertaken by the respondent would fall particularly under the provision of “undertakes ... other work connected therewith...” and so fit in the definition of contractor in that section.
43. However, the definition has an exception that a person shall not be deemed to be a contractor if the work undertaken does not incur a cost exceeding such sum or sums as the Board may from time to time determine. I note that in its submissions, the appellant has not made reference to the proviso to section 16(1) of the Act.
44. Since the appellant was the one asserting that the respondent was not duly registered, under section 109 of the Evidence Act (Cap. 80) Laws of Kenya, the onus was upon the appellant to show that the works contracted between them did not fall within this proviso and therefore that the respondent was required to be registered under the Act. Section 109 of the Evidence Act provides that the burden of proof as to any particular fact lies on the person who wishes the court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on any particular person.
45. I find from the evidence on record that the appellant did not provide any such evidence. Consequently, its assertion that the respondent was disqualified under the Act from contracting for the works it undertook for the appellant and that the contract was therefore illegal and void ab initio was not established.
46. I am satisfied and I find that even though without making reference to the provisions of the NCA Act with respect to registration of contractors, learned Adjudicator, though reasoning differently, arrived at the correct decision that the appellant was in breach of contract with the respondent and was liable to pay the respondent KShs 856,000/= as the balance of the cost of services rendered to the appellant.
47. Consequently, I find that the appeal has no merit and the same is dismissed. The judgment of the trial court is affirmed.
48. The respondent shall get the costs of this appeal.
49. Orders accordingly.
50. Delivered, dated and signed on the Virtual Platform, Teams this 12th day of March 2026 and uploaded on the CTS for access by parties.
ANDAYI W. F.
JUDGE
In the presence of:
N/A for the Appellant.
Kathure (Ms) h/b for Orenge for the Respondent.
Ummu h/b for Aminaa: Court Assistant.