' Background
1. This is a ruling on the Notice of Motion dated 10th July 2023 brought by the Plaintiff/Applicant under Order 36 Rules 1 and 5 of the Civil Procedure Rules 2010 and Sections 1A, 1B, and 3A of the Civil Procedure Act. The Applicant seeks summary judgment against the Defendant/Respondent for USD 428,887.53 together with interest from 10th May 2022 until payment in full and the costs of the suit.
2. The motion is supported by the Supporting Affidavit of Marina Champion sworn on 10th July 2023 and various annexures including a statement of account and a copy of what is described as a Business Alignment Agreement dated 13th May 2021. The Applicant’s position is that the Defendant is truly indebted to it for the said sum being the balance due for goods supplied pursuant to the agreement between the parties.
3. In opposition, the Defendant filed a Replying Affidavit sworn on 19th October 2023 and written submissions dated 24th April 2024, contending that the alleged agreement and indebtedness are disputed; that the statement of account relied upon was generated solely by the Applicant and has not been acknowledged by the Defendant; and that the circumstances of the alleged breach raise triable issues that ought to be heard and determined at trial.
4. It is common ground that the parties were engaged in a commercial relationship relating to the supply of pre-mixed food fortification products. Between 28th March 2018 and 30th April 2019, the Applicant issued the Respondent with Private Finance Initiatives (PFIs) pursuant to which goods were delivered. The Applicant avers that as of 30th April 2019, the outstanding balance stood at USD 515,624.85, later reduced through part payments including USD 18,567.32 on 17th November 2020, USD 27,800 on 4th May 2021, and USD 20,000 and USD 20,370 in June and July 2021 respectively.
5. Following a meeting held on 5th May 2021, the parties are said to have concluded the Business Alignment Agreement on 13th May 2021, which provided inter alia that the Defendant would make monthly payments of USD 20,000 and that future orders would be subject to prepayment. The Applicant avers that no payments have been made since July 2021, leaving an outstanding balance of USD 428,887.53, as shown in its internal statement of account.
6. The Respondent, however, denies execution of the alleged Business Alignment Agreement and contends that the statement of account is unilaterally prepared and unacknowledged. It maintains that there are disputes regarding reconciliation of accounts and the actual amount due for goods supplied, which can only be resolved through evidence at trial.
Issue for Determination
7. The sole issue for determination is whether the Applicant has met the threshold for entry of summary judgment under Order 36 Rule 1 of the Civil Procedure Rules?
8. Order 36 Rule 1(1) provides that where a defendant has entered appearance, the plaintiff may apply for judgment where the defendant has no bona fide defence to the claim. However, the rule has been consistently interpreted with caution, the courts emphasizing that summary judgment is a drastic remedy to be granted only in clear and obvious cases.
9. In Continental Butchery Ltd v Samson Musila Nthiwa [1978] eKLR, the Court of Appeal stated that the purpose of summary judgment is to enable a plaintiff to obtain a quick judgment where there is plainly no defence, but where a defendant raises even one bona fide triable issue, leave to defend should be granted. Similarly, in Industrial & Commercial Development Corporation v Daber Enterprises Ltd [2000] eKLR, the Court held that the jurisdiction to enter summary judgment should be exercised only where there is no doubt that the defendant has no plausible defence.
10. The same principle was reaffirmed in Harit Sheth t/a Harit Sheth Advocates v Shamas Charania [2014] eKLR and Diamond Trust Bank Kenya Ltd v Eric Barasa Nakitare [2019] eKLR, where the Court of Appeal observed that summary judgment can only be entered where the claim is so plain and obvious that it leaves no room for doubt or contest.
Analysis and Determination
11. I have considered the pleadings, affidavits, and submissions on record. It is not in dispute that there were prior commercial dealings between the parties. However, the existence and effect of the alleged Business Alignment Agreement of 13th May 2021 and the statement of account relied upon by the Applicant are matters of factual contestation.
12. The statement forming the basis of the claim is one generated by the Applicant. There is no indication that it was confirmed, signed, or adopted by the Respondent. Likewise, there is no written acknowledgment of the debt or evidence of admission by the Respondent that the amount of USD 428,887.53 is indeed owed.
13. While the Applicant relies on partial payments as evidence of acknowledgment, the Respondent disputes the underlying reconciliation of accounts, and the completeness of deliveries. These issues go to the root of liability and quantum and cannot be resolved without oral evidence.
14. Moreover, although the said agreement on repayment was exhibited, there is insufficient evidence on record showing breach of its express terms by the Respondent. Whether the Business Alignment Agreement was binding, and whether it was executed by authorized representatives are triable issues that warrant ventilation at full trial.
Disposition
15. Upon evaluation of the material before me, I am satisfied that the Respondent’s defence raises triable issues of both fact and law , particularly the existence and execution of the Business Alignment Agreement; whether terms of the same were breached; the authenticity and accuracy of the Applicant’s internal statement of account; and whether the alleged amount of USD 428,887.53 remains due and payable.
16. Consequently, the Applicant has not demonstrated that this is a plain and obvious case fit for summary judgment. The Notice of Motion dated 10th July 2023 is accordingly dismissed. Costs of the application shall abide the outcome of the main suit.
'
1. This is a ruling on the Notice of Motion dated 10th July 2023 brought by the Plaintiff/Applicant under Order 36 Rules 1 and 5 of the Civil Procedure Rules 2010 and Sections 1A, 1B, and 3A of the Civil Procedure Act. The Applicant seeks summary judgment against the Defendant/Respondent for USD 428,887.53 together with interest from 10th May 2022 until payment in full and the costs of the suit.
2. The motion is supported by the Supporting Affidavit of Marina Champion sworn on 10th July 2023 and various annexures including a statement of account and a copy of what is described as a Business Alignment Agreement dated 13th May 2021. The Applicant’s position is that the Defendant is truly indebted to it for the said sum being the balance due for goods supplied pursuant to the agreement between the parties.
3. In opposition, the Defendant filed a Replying Affidavit sworn on 19th October 2023 and written submissions dated 24th April 2024, contending that the alleged agreement and indebtedness are disputed; that the statement of account relied upon was generated solely by the Applicant and has not been acknowledged by the Defendant; and that the circumstances of the alleged breach raise triable issues that ought to be heard and determined at trial.
4. It is common ground that the parties were engaged in a commercial relationship relating to the supply of pre-mixed food fortification products. Between 28th March 2018 and 30th April 2019, the Applicant issued the Respondent with Private Finance Initiatives (PFIs) pursuant to which goods were delivered. The Applicant avers that as of 30th April 2019, the outstanding balance stood at USD 515,624.85, later reduced through part payments including USD 18,567.32 on 17th November 2020, USD 27,800 on 4th May 2021, and USD 20,000 and USD 20,370 in June and July 2021 respectively.
5. Following a meeting held on 5th May 2021, the parties are said to have concluded the Business Alignment Agreement on 13th May 2021, which provided inter alia that the Defendant would make monthly payments of USD 20,000 and that future orders would be subject to prepayment. The Applicant avers that no payments have been made since July 2021, leaving an outstanding balance of USD 428,887.53, as shown in its internal statement of account.
6. The Respondent, however, denies execution of the alleged Business Alignment Agreement and contends that the statement of account is unilaterally prepared and unacknowledged. It maintains that there are disputes regarding reconciliation of accounts and the actual amount due for goods supplied, which can only be resolved through evidence at trial.
Issue for Determination
7. The sole issue for determination is whether the Applicant has met the threshold for entry of summary judgment under Order 36 Rule 1 of the Civil Procedure Rules?
8. Order 36 Rule 1(1) provides that where a defendant has entered appearance, the plaintiff may apply for judgment where the defendant has no bona fide defence to the claim. However, the rule has been consistently interpreted with caution, the courts emphasizing that summary judgment is a drastic remedy to be granted only in clear and obvious cases.
9. In Continental Butchery Ltd v Samson Musila Nthiwa [1978] eKLR, the Court of Appeal stated that the purpose of summary judgment is to enable a plaintiff to obtain a quick judgment where there is plainly no defence, but where a defendant raises even one bona fide triable issue, leave to defend should be granted. Similarly, in Industrial & Commercial Development Corporation v Daber Enterprises Ltd [2000] eKLR, the Court held that the jurisdiction to enter summary judgment should be exercised only where there is no doubt that the defendant has no plausible defence.
10. The same principle was reaffirmed in Harit Sheth t/a Harit Sheth Advocates v Shamas Charania [2014] eKLR and Diamond Trust Bank Kenya Ltd v Eric Barasa Nakitare [2019] eKLR, where the Court of Appeal observed that summary judgment can only be entered where the claim is so plain and obvious that it leaves no room for doubt or contest.
Analysis and Determination
11. I have considered the pleadings, affidavits, and submissions on record. It is not in dispute that there were prior commercial dealings between the parties. However, the existence and effect of the alleged Business Alignment Agreement of 13th May 2021 and the statement of account relied upon by the Applicant are matters of factual contestation.
12. The statement forming the basis of the claim is one generated by the Applicant. There is no indication that it was confirmed, signed, or adopted by the Respondent. Likewise, there is no written acknowledgment of the debt or evidence of admission by the Respondent that the amount of USD 428,887.53 is indeed owed.
13. While the Applicant relies on partial payments as evidence of acknowledgment, the Respondent disputes the underlying reconciliation of accounts, and the completeness of deliveries. These issues go to the root of liability and quantum and cannot be resolved without oral evidence.
14. Moreover, although the said agreement on repayment was exhibited, there is insufficient evidence on record showing breach of its express terms by the Respondent. Whether the Business Alignment Agreement was binding, and whether it was executed by authorized representatives are triable issues that warrant ventilation at full trial.
Disposition
15. Upon evaluation of the material before me, I am satisfied that the Respondent’s defence raises triable issues of both fact and law , particularly the existence and execution of the Business Alignment Agreement; whether terms of the same were breached; the authenticity and accuracy of the Applicant’s internal statement of account; and whether the alleged amount of USD 428,887.53 remains due and payable.
16. Consequently, the Applicant has not demonstrated that this is a plain and obvious case fit for summary judgment. The Notice of Motion dated 10th July 2023 is accordingly dismissed. Costs of the application shall abide the outcome of the main suit.
'