Introduction and Background
1. This Ruling determines the application dated 11th August 2025, brought under Section 1A, 1B and 3A of the Civil Procedure Act, Order 9 Rule 9, Order 10 Rule 11, Order 51 Rule 1, and 15 Order 22 Rule 22(1) of the Civil Procedure Rules. The Applicants who are the Defendants in the suit seek three substantive reliefs.
2. First, they seek leave to be granted to the firm of Kithu Mbuthia & Company Advocates to formally come on record as representing the Applicants in these proceedings. Second, they pray that the default judgment entered against them on 24th July 2025 in favour of the Respondent, together with all consequential orders and proceedings, be set aside.
3. In addition, they seek to be accorded unconditional leave to defend the suit in terms of the annexed Statement of Defence. The applicants further urge that the Statement of Defence dated 22nd July 2025 be deemed duly filed and properly on record, and that it be served upon the Respondent as part of the regular course of proceedings.
4. The application is opposed through a Replying Affidavit sworn by Felix Kitoto on 19th September 2025. In arriving at this determination, I have also considered the Further Affidavit filed on behalf of the Applicants, together with the written submissions presented by both parties.
Analysis and Determination
5. On the issue of leave to come on record, the Respondent has argued that the Notice of Appointment filed by Kithu Mbuthia & Company Advocates is incurably defective. According to the Respondent, all subsequent filings are of no legal effect, as the Notice was lodged in blatant disregard of the mandatory provisions of Order 9 Rule 9 of the Civil Procedure Rules.
6. Having considered this contention, I note that the present application has been properly brought in compliance with Order 9 Rule 9, as it expressly seeks leave for counsel to come on record. The omission to file a Notice of Change of Advocates in place of a Notice of Appointment, though procedurally irregular does not occasion any prejudice to the Respondent. It is a technical lapse that does not go to the substance of the matter. I therefore find no reason to deny the prayer sought, particularly where no demonstrable prejudice has been shown to result from the inadvertent omission.
7. In reaching this conclusion, I am guided by the decision in Tobias M. Wafubwa v Ben Butali [2017] KESA 142 (KLR), where the Court of Appeal observed:
“We would go further to add that, provided that where the failure to comply with rule 9 did not undermine the jurisdiction of the court, or affect the core of the dispute in question, or prejudice either of the parties in any way as to lead to a miscarriage of justice, then, Article 159 of the Constitution and the overriding principles could be called upon to aid the court to dispense substantive justice through just, efficient and timely disposal of proceedings.”
8. Turning now to the prayer for setting aside the default judgment, the Applicants attribute the failure to file their Statement of Defence to the negligence of their former counsel. They allege that despite making follow-ups with counsel, the defence was not filed. However, unlike the other correspondence on record which consistently documents updates on the progress of the matter, there is no single communication evidencing such follow-up in relation to the filing of the defence. This omission is particularly striking given that the Applicants themselves acknowledge that the amount in dispute is a colossal sum of Kshs. 120,817,739.68 together with contractual interest.
9. It seems to me that they were clearly aware of the suit and its gravity, but owing to whatever fallout may have arisen between themselves and their advocates on record, they failed to ensure the filing of their defence. They now seek to shift the blame entirely onto their former counsel.
10. The applicable principles in determining applications for setting aside default judgments are well settled. In CMC Holdings Limited v James Mumo Nzioki [2004] eKLR, the Court of Appeal held:
“The law is now well settled that in an application for setting aside ex parte judgment, the court must consider not only reasons why the defence was not filed or for that matter why the applicant failed to turn up for hearing on the hearing date but also whether the applicant has reasonable defence which is usually referred as whether the defence if filed already or if a draft defence is annexed to the application, raises triable issues.”
11. Similarly, in Osodo v Barclays Bank International Ltd [1980] KLR 31 and in Lucy Momanyi t/a I.N. Momanyi & Company v Nurein M.A. Hatimy & Another [2003] KECA 3 (KLR) the Court emphasized the importance of affording a party the opportunity to defend their case where there appears to be arguable grounds.
12. I have carefully examined the Statement of Defence annexed to the application. The Applicants candidly admit the existence of the loan agreement and the arrears in repayment. They further concede that the motor cycles were repossessed and sold. However, they raise serious allegations that the process was tainted with fraud and illegality, and therefore cannot stand as a lawful realization of the security.
13. Specifically, they contend that the Respondents failed to ensure proper valuation of the motor vehicles and motor cycles was done prior to sale, that no advertisement was issued as required under the Auctioneers Rules and the Hire Purchase Act, no accounts were rendered following the sale of the repossessed assets and that exorbitant and unlawful interest charges were levied against them. If established at trial, the allegations would have a significant bearing on the rights and obligations of the parties.
14. It is significant to note that the Plaintiffs have not addressed these concerns in their Replying Affidavit or submissions. The silence strengthens the Applicants’ position that the defence raises triable issues worthy of judicial interrogation and that the averments are not frivolous or superficial assertions. In light of these considerations, I am satisfied that the Statement of Defence discloses substantial grounds which merit full examination at trial.
15. The Applicants must therefore be afforded an opportunity to present and ventilate their case, in line with the overriding objective of the Civil Procedure Act and the constitutional imperative under Article 159. Allowing the matter to proceed to trial will best serve the ends of substantive justice.
Disposition
16. Accordingly, the application dated 11th August 2025 is allowed. I make the following final orders:
i. Leave is hereby granted to the firm of Kithu Mbuthia & Company Advocates to come on record for the Applicants.
ii. The default judgment entered on 24th July 2025 together with all consequential orders and proceedings is hereby set aside.
iii. The Applicants are granted unconditional leave to defend the suit.
iv. The Statement of Defence dated 22nd July 2025 is deemed duly filed and properly on record, and shall be served upon the Plaintiff forthwith.
v. Costs of this application shall abide the outcome of the main suit.
1. This Ruling determines the application dated 11th August 2025, brought under Section 1A, 1B and 3A of the Civil Procedure Act, Order 9 Rule 9, Order 10 Rule 11, Order 51 Rule 1, and 15 Order 22 Rule 22(1) of the Civil Procedure Rules. The Applicants who are the Defendants in the suit seek three substantive reliefs.
2. First, they seek leave to be granted to the firm of Kithu Mbuthia & Company Advocates to formally come on record as representing the Applicants in these proceedings. Second, they pray that the default judgment entered against them on 24th July 2025 in favour of the Respondent, together with all consequential orders and proceedings, be set aside.
3. In addition, they seek to be accorded unconditional leave to defend the suit in terms of the annexed Statement of Defence. The applicants further urge that the Statement of Defence dated 22nd July 2025 be deemed duly filed and properly on record, and that it be served upon the Respondent as part of the regular course of proceedings.
4. The application is opposed through a Replying Affidavit sworn by Felix Kitoto on 19th September 2025. In arriving at this determination, I have also considered the Further Affidavit filed on behalf of the Applicants, together with the written submissions presented by both parties.
Analysis and Determination
5. On the issue of leave to come on record, the Respondent has argued that the Notice of Appointment filed by Kithu Mbuthia & Company Advocates is incurably defective. According to the Respondent, all subsequent filings are of no legal effect, as the Notice was lodged in blatant disregard of the mandatory provisions of Order 9 Rule 9 of the Civil Procedure Rules.
6. Having considered this contention, I note that the present application has been properly brought in compliance with Order 9 Rule 9, as it expressly seeks leave for counsel to come on record. The omission to file a Notice of Change of Advocates in place of a Notice of Appointment, though procedurally irregular does not occasion any prejudice to the Respondent. It is a technical lapse that does not go to the substance of the matter. I therefore find no reason to deny the prayer sought, particularly where no demonstrable prejudice has been shown to result from the inadvertent omission.
7. In reaching this conclusion, I am guided by the decision in Tobias M. Wafubwa v Ben Butali [2017] KESA 142 (KLR), where the Court of Appeal observed:
“We would go further to add that, provided that where the failure to comply with rule 9 did not undermine the jurisdiction of the court, or affect the core of the dispute in question, or prejudice either of the parties in any way as to lead to a miscarriage of justice, then, Article 159 of the Constitution and the overriding principles could be called upon to aid the court to dispense substantive justice through just, efficient and timely disposal of proceedings.”
8. Turning now to the prayer for setting aside the default judgment, the Applicants attribute the failure to file their Statement of Defence to the negligence of their former counsel. They allege that despite making follow-ups with counsel, the defence was not filed. However, unlike the other correspondence on record which consistently documents updates on the progress of the matter, there is no single communication evidencing such follow-up in relation to the filing of the defence. This omission is particularly striking given that the Applicants themselves acknowledge that the amount in dispute is a colossal sum of Kshs. 120,817,739.68 together with contractual interest.
9. It seems to me that they were clearly aware of the suit and its gravity, but owing to whatever fallout may have arisen between themselves and their advocates on record, they failed to ensure the filing of their defence. They now seek to shift the blame entirely onto their former counsel.
10. The applicable principles in determining applications for setting aside default judgments are well settled. In CMC Holdings Limited v James Mumo Nzioki [2004] eKLR, the Court of Appeal held:
“The law is now well settled that in an application for setting aside ex parte judgment, the court must consider not only reasons why the defence was not filed or for that matter why the applicant failed to turn up for hearing on the hearing date but also whether the applicant has reasonable defence which is usually referred as whether the defence if filed already or if a draft defence is annexed to the application, raises triable issues.”
11. Similarly, in Osodo v Barclays Bank International Ltd [1980] KLR 31 and in Lucy Momanyi t/a I.N. Momanyi & Company v Nurein M.A. Hatimy & Another [2003] KECA 3 (KLR) the Court emphasized the importance of affording a party the opportunity to defend their case where there appears to be arguable grounds.
12. I have carefully examined the Statement of Defence annexed to the application. The Applicants candidly admit the existence of the loan agreement and the arrears in repayment. They further concede that the motor cycles were repossessed and sold. However, they raise serious allegations that the process was tainted with fraud and illegality, and therefore cannot stand as a lawful realization of the security.
13. Specifically, they contend that the Respondents failed to ensure proper valuation of the motor vehicles and motor cycles was done prior to sale, that no advertisement was issued as required under the Auctioneers Rules and the Hire Purchase Act, no accounts were rendered following the sale of the repossessed assets and that exorbitant and unlawful interest charges were levied against them. If established at trial, the allegations would have a significant bearing on the rights and obligations of the parties.
14. It is significant to note that the Plaintiffs have not addressed these concerns in their Replying Affidavit or submissions. The silence strengthens the Applicants’ position that the defence raises triable issues worthy of judicial interrogation and that the averments are not frivolous or superficial assertions. In light of these considerations, I am satisfied that the Statement of Defence discloses substantial grounds which merit full examination at trial.
15. The Applicants must therefore be afforded an opportunity to present and ventilate their case, in line with the overriding objective of the Civil Procedure Act and the constitutional imperative under Article 159. Allowing the matter to proceed to trial will best serve the ends of substantive justice.
Disposition
16. Accordingly, the application dated 11th August 2025 is allowed. I make the following final orders:
i. Leave is hereby granted to the firm of Kithu Mbuthia & Company Advocates to come on record for the Applicants.
ii. The default judgment entered on 24th July 2025 together with all consequential orders and proceedings is hereby set aside.
iii. The Applicants are granted unconditional leave to defend the suit.
iv. The Statement of Defence dated 22nd July 2025 is deemed duly filed and properly on record, and shall be served upon the Plaintiff forthwith.
v. Costs of this application shall abide the outcome of the main suit.