Introduction and Background
1. This suit was instituted by the applicant (the Bank), through a plaint dated 28th August 2023. The Bank seeks to recover the amount of Kshs. 52,424,286.40 being an outstanding debt due from the respondents under a Murabahah facility extended by the Bank. The respondents entered appearance and filed their statement of defense dated 23rd November 2023. This prompted the application dated 19th August 2024 by which the Bank seeks to have the statement of defence struck out for not disclosing any reasonable defence in law and for default judgment to be entered against the defendants.
Analysis and Determination
2. The application is premised on Order 2 Rule 15(1) of the Civil Procedure Rules which states:
“At any stage of the proceedings the court may order to be struck out or amended any pleading on the grounds that;
a) It discloses no reasonable cause of action or defence in law; or
b) It is scandalous, frivolous or vexatious; or
c) It may prejudice, embarrass or delay the fair trial of the action or
d) It is otherwise an abuse of the process of the court, and may order the suit to be stayed or dismissed or judgment to be entered accordingly as the case may be.”
3. It is well-established jurisprudence that the application of Order 2, Rule 15(1) must be approached with caution, as striking out pleadings is a drastic measure that effectively denies a party the right to be heard. Courts have consistently held that such applications should only succeed in cases where the defense is clearly frivolous, vexatious, or amounts to an abuse of the court process. However, the Rule also serves an important purpose, to prevent the unnecessary expenditure of judicial time and resources on cases where the defense is merely a sham, one that does not raise any triable issues or substantive arguments but is instead intended to delay proceedings.
4. Thus, the Court of Appeal in Meya Agri Traders Ltd V Elgon House, (2010) Ltd (CA 15 of 2020) emphasized that:
“…striking out of pleadings is a draconian tool which must only be deployed by courts in the clearest of incidences. In our view, if a pleading raises a triable issue irrespective of whether it will succeed or not, the suit ought to be allowed to proceed to trial. On the contrary, where a pleading is of no substance or ground, mere denial, fanciful and or is of some ulterior motive the court should not shy away from invoking its powers to strike out such a suit.”
5. I have reviewed the statement of defense filed by the respondents and note that it consists primarily of bare denials of most allegations set out in the plaint. In particular, the respondents deny the existence of the facility agreement, the loan amounts claimed by the Bank, their role as guarantors, the occurrence of default, the restructuring of the facility, and the subsequent default that led to the present suit.
6. On the face of it, the Bank’s supporting documents clearly establish the existence of the financial arrangement between the parties. The letter of offer dated 27th January 2022 unequivocally sets out the terms of the Tawarruq/Commodity Murabahah facility amounting to Kshs. 54,607,380/= (as evidenced on pages 15–20 of the Bank’s documents). The facility was specifically structured to finance the takeover of an existing loan from DIB Kenya Limited, with a repayment schedule spanning 60 months through fixed monthly installments of Kshs. 910,123/=.
7. The letter of offer is duly executed through the signatures of both the Bank and the respondents, affirming their contractual obligations. This is further reinforced by the Murabahah agreement dated 27th January 2022 (at pages 21–38 of the Bank’s documents), which sets out the binding terms of the facility. Additionally, as a precondition for the loan, the 2nd and 3rd respondents executed a Guarantee and Indemnity form on behalf of the 1st respondent (at pages 41–46 of the Bank’s documents), further cementing their liability. The documentary evidence leaves no doubt as to the respondents’ involvement in the facility and their contractual obligations arising therefrom.
8. The authenticity of these documents has not been challenged. As a result, there is no bona fide defense that would justify proceeding to a full trial. The defendants have failed to establish a clear and substantive line of defense, making this a proper case for striking out the statement of defense, noting that the Bank has presented sufficient material before the court, which, even if subjected to a full trial, would be adequate to prove its case. The record speaks for itself, standing in stark contrast to the defendants’ mere denials. Given that this is a liquidated claim, the Bank is entitled to judgment as prayed.
Disposition
9. Accordingly, the application dated 19th August 2024 is allowed as prayed. The defendants’ statement of defense dated 23rd November 2023 is struck out for disclosing no reasonable defense in law, for being frivolous, vexatious and otherwise an abuse of the court process. Consequently, judgment is hereby entered against the 1st, 2nd and 3rd defendants, for the sum of Kshs 52,424,286.40 at the time of instituting the claim. The Bank shall have the costs of the application.
DATED, SIGNED AND DELIVERED IN NAIROBI
THIS 23RD DAY OF MAY 2025.
F. MUGAMBI
JUDGE
1. This suit was instituted by the applicant (the Bank), through a plaint dated 28th August 2023. The Bank seeks to recover the amount of Kshs. 52,424,286.40 being an outstanding debt due from the respondents under a Murabahah facility extended by the Bank. The respondents entered appearance and filed their statement of defense dated 23rd November 2023. This prompted the application dated 19th August 2024 by which the Bank seeks to have the statement of defence struck out for not disclosing any reasonable defence in law and for default judgment to be entered against the defendants.
Analysis and Determination
2. The application is premised on Order 2 Rule 15(1) of the Civil Procedure Rules which states:
“At any stage of the proceedings the court may order to be struck out or amended any pleading on the grounds that;
a) It discloses no reasonable cause of action or defence in law; or
b) It is scandalous, frivolous or vexatious; or
c) It may prejudice, embarrass or delay the fair trial of the action or
d) It is otherwise an abuse of the process of the court, and may order the suit to be stayed or dismissed or judgment to be entered accordingly as the case may be.”
3. It is well-established jurisprudence that the application of Order 2, Rule 15(1) must be approached with caution, as striking out pleadings is a drastic measure that effectively denies a party the right to be heard. Courts have consistently held that such applications should only succeed in cases where the defense is clearly frivolous, vexatious, or amounts to an abuse of the court process. However, the Rule also serves an important purpose, to prevent the unnecessary expenditure of judicial time and resources on cases where the defense is merely a sham, one that does not raise any triable issues or substantive arguments but is instead intended to delay proceedings.
4. Thus, the Court of Appeal in Meya Agri Traders Ltd V Elgon House, (2010) Ltd (CA 15 of 2020) emphasized that:
“…striking out of pleadings is a draconian tool which must only be deployed by courts in the clearest of incidences. In our view, if a pleading raises a triable issue irrespective of whether it will succeed or not, the suit ought to be allowed to proceed to trial. On the contrary, where a pleading is of no substance or ground, mere denial, fanciful and or is of some ulterior motive the court should not shy away from invoking its powers to strike out such a suit.”
5. I have reviewed the statement of defense filed by the respondents and note that it consists primarily of bare denials of most allegations set out in the plaint. In particular, the respondents deny the existence of the facility agreement, the loan amounts claimed by the Bank, their role as guarantors, the occurrence of default, the restructuring of the facility, and the subsequent default that led to the present suit.
6. On the face of it, the Bank’s supporting documents clearly establish the existence of the financial arrangement between the parties. The letter of offer dated 27th January 2022 unequivocally sets out the terms of the Tawarruq/Commodity Murabahah facility amounting to Kshs. 54,607,380/= (as evidenced on pages 15–20 of the Bank’s documents). The facility was specifically structured to finance the takeover of an existing loan from DIB Kenya Limited, with a repayment schedule spanning 60 months through fixed monthly installments of Kshs. 910,123/=.
7. The letter of offer is duly executed through the signatures of both the Bank and the respondents, affirming their contractual obligations. This is further reinforced by the Murabahah agreement dated 27th January 2022 (at pages 21–38 of the Bank’s documents), which sets out the binding terms of the facility. Additionally, as a precondition for the loan, the 2nd and 3rd respondents executed a Guarantee and Indemnity form on behalf of the 1st respondent (at pages 41–46 of the Bank’s documents), further cementing their liability. The documentary evidence leaves no doubt as to the respondents’ involvement in the facility and their contractual obligations arising therefrom.
8. The authenticity of these documents has not been challenged. As a result, there is no bona fide defense that would justify proceeding to a full trial. The defendants have failed to establish a clear and substantive line of defense, making this a proper case for striking out the statement of defense, noting that the Bank has presented sufficient material before the court, which, even if subjected to a full trial, would be adequate to prove its case. The record speaks for itself, standing in stark contrast to the defendants’ mere denials. Given that this is a liquidated claim, the Bank is entitled to judgment as prayed.
Disposition
9. Accordingly, the application dated 19th August 2024 is allowed as prayed. The defendants’ statement of defense dated 23rd November 2023 is struck out for disclosing no reasonable defense in law, for being frivolous, vexatious and otherwise an abuse of the court process. Consequently, judgment is hereby entered against the 1st, 2nd and 3rd defendants, for the sum of Kshs 52,424,286.40 at the time of instituting the claim. The Bank shall have the costs of the application.
DATED, SIGNED AND DELIVERED IN NAIROBI
THIS 23RD DAY OF MAY 2025.
F. MUGAMBI
JUDGE