OLIVE NJERI NGUGI VS Martin Mwaura Chege AND Charles Njoroge Ngugi

(Being an appeal from the judgment and decree of Hon. Jacinta A. Orwa Senior Principal Magistrate delivered on 21^st July 2023 in the Magistrates Court at Kikuyu MCCC No.66 of 2019)

JUDGMENT

1. This appeal arises from a suit by the 1^st respondent against the appellant and the 2^nd respondent in a plaint amended on 10/3/2020 for breach of contract. The respondent’s claim in the suit was for special damages of KShs 217,326/= for unpaid trappers and general damages for stolen trappers plus interest and costs.
2. The respondent’s claim was that on 18/1/2018 he entered into a written agreement with the appellant to lease 369 metal trappers from the 1^st respondent for purposes of construction of a building for the 2^nd respondent on land parcel No. Sigona/1826 belonging to the 2^nd respondent. The agreement was for payment of the metal trappers on a monthly basis. The 1^st respondent received payment either from the appellant or the 2^nd respondent who was based outside Kenya and would send the money to the 1^st respondent through international money transfer.
3. The appellant returned 65 trappers in February (it is not stated which year) and remained with 269 trappers. The appellant and the 2^nd respondent failed to pay for the trappers that remained with them and subsequently the 1^st respondent discovered that some of them had been stolen. He thus filed suit to recover the unpaid money for the trappers and general damages for those stolen.
4. The appellant filed a statement of defence dated 26/10/2020 and averred that she was an employee of the 2^nd respondent as project manager and entered into the contract with the 1^st respondent in that capacity and with the instructions of the 2^nd respondent, a fact which the 1^st respondent was all aware. 
5. The 1^st respondent and the appellant testified in the case and each was cross-examined largely upon the lines of their pleadings.
6. Upon considering the evidence and submissions of parties, the learned trial magistrate found that the appellant was an agent/employee of the 2^nd respondent and was therefore liable to pay the balance of the money for leasing the 269 trappers. She also found that she was duty bound to the safety of the trappers while at the site. She was therefore liable for breach of contract with the 2^nd respondent being vicariously liable. She found the case by the 1^st respondent against the appellant proved on the claim for KShs 217,326/=. She however disallowed the claim for general damages. She entered judgment for the 1^st respondent against the appellant and the 2^nd respondent being KShs 217,326/= jointly and severally.
7. The appellant now appeals against that decision raising some four grounds which in however is just one ground that the learned trial magistrate erred in fact and in law by finding the appellant liable and entering judgment against her jointly and severally with the 2^nd respondent despite the appellant being an employee and agent of a disclosed principal, the 2^nd respondent.
8. The court directed that the appeal be heard by way of written submissions which learned counsels for the appellant and the 1^st respondent duly filed.
9. Learned counsel for the appellant the issues for determination are those laid out in the grounds in the memorandum of appeal.
10. This being a first appeal, the duty of the court is to re-evaluate, re-analyze and re-consider the evidence and draw its own conclusions, bearing in mind that it did not see witnesses testifying and therefore give due allowance for that. See for example Selle & another vs. Associated Motor Boat Co. Ltd & others [1968] E.A at page 126 where it was held as follows:

“An appeal to this Court from a trial by the High Court is by way of retrial and the principles upon which this Court acts in such an appeal are well settled.  Briefly put they are that this Court must reconsider the evidence, evaluate it itself and draw its own conclusions though it should always bear in mind that it has neither seen nor heard the witnesses and should make due allowance in this respect.  In particular, this court is not bound necessarily to follow the trial judge’s findings of fact if it appears either that he has clearly failed on some point to take account of particular circumstances or probabilities materially to estimate the evidence or if the impression based on the demeanor of a witness is inconsistent with the evidence in the case generally (Abdul Hameed Saif v Ali Mohamed Sholan (1955), 22 E.A.C.A. 270)”.

1. See similar holding in Peters vs. Sunday Post Limited (1968) EA 123. (1956) E.A page 424.
2. For me, the issues for determination are whether or not the appellant was liable on the contract in this case in any way and if so, whether the trial court was correct to award the respondent general damages for the breach.
3. The 1^st respondent pleaded in his amended plaint that the appellant was categorical that she worked as a contractor for the 2^nd respondent and with authority from the 2^nd respondent to enter into agreements for purposes of obtaining materials, including the trappers for the construction of the building. The appellant however maintained in her statement of defence that she was an employee of the 2^nd respondent as a project manager. He reiterated the same in his evidence-in-chief which was adopted from his witness statement which is undated but signed and filed alongside the initial plaint in court on 20/3/2019. However, in cross-examination, he said that Olive was the supervisor of the project.
4. On her part, the appellant pleaded in her statement of defence that she was an employee of the 2^nd defendant as a project manager and she left the employment in the month of April, 2018. She also pleaded that this fact was well known to the 1^st respondent. She maintained the same position in her evidence-in-chief adopted from her witness statement dated 3/8/2022. In cross-examination, she said that she was a contactor. Learned counsel for the 1^st respondent submits that the appellant was contacted to put up the building. It is however not clear whether she was referring to the time she was giving her testimony or if the same applied before during her engagement with the respondent.
5. The agreement between the appellant and the 1^st respondent made on 18/1/2018 is not disputed at all. It is also not disputed that at the time when the agreement was made the appellant was working on the 2^nd respondent’s construction project. What is in dispute is the nature of the relationship between the appellant and the 2^nd respondent and therefore her liability to the 1^st respondent. It is the word of the appellant against that of the 1^st respondent seeing that the 2^nd respondent never offered any evidence in the trial court.
6. Learned counsel for the 1^st respondent has cited the case of Maurice Oduor Okech v Chequered Flag Limited [2013] eKLR citing the case of Everret Aviation Limited Vs the Kenya Revenue Authority [2013] eKLR, stated that:

“.. In determining whether a relationship between parties is a contract for services between two independent parties or a contract of service giving rise to an employer/employee relationship, the traditional tests of control of the work by the employer and its integration into the employer’s care business are no longer conclusive.   In my view, the fundamental behaviour of the parties such as the form of documentation evidencing the relationship and the mode of payment is critical.”

1. In this case, the form of contract between the appellant and the 1^2nd respondent is not supported by documentary evidence. But the law under section 107(1) of the Evidence Act and supported by many authorities requires that he who asserts must prove. The burden was upon the 1^st respondent to prove his allegations that indeed the appellant was an independent contractor engaged by the 2^nd respondent on his project. The appellant maintains that she was an employee. Indeed, the 1^st respondent who dealt with her at her work place said in cross-examination that she was a supervisor of the project. Secondly, the 1^st respondent also said that he spoke to the 2^nd respondent about the leasing of the trappers and the 2^nd respondent would send him money for the lease directly. That to me is proof that he acknowledged that the appellant was only a manager of the project. Otherwise if she was an independent contractor, the 1^st respondent would not have bothered to engage with the 2^nd respondent over the lease of the trappers.  
2. The learned trial magistrate found that the appellant was an employee of the 2^nd respondent. In that case, there would be no difficulty in finding, as learned counsel for the appellant urges that she was an agent of a disclosed principal, the 2^nd respondent.  In that case, the position in law and on abundance of decided authorities is that where a principal is disclosed and known, his/her agent should not be sued in the same cause as a co-defendant. Learned counsel for the appellant has cited two authorities to buttress that position. City Council of Nairobi v Wilfred Kamau Githua t/a Githua Associates & another [2016] eKLRB the Court of Appeal held that:

“In the circumstances of this case, the 2^nd respondent cannot be sued as agent where there is a disclosed principal [the appellant]. There is therefore no cause of action against the 2^nd respondent. The principle of common law is that where the principal is disclosed, the agent is not to be sued. In the circumstances of this case, the principal (the appellant) is disclosed and the agent (the 2^nd respondent) cannot therefore be sued. There are no factors vitiating the liability of the disclosed principal. Accordingly, the enjoinment of the 2^nd respondent in this case is unwarranted.”

1. What it means simply is that the appellant herein as employee/agent of the 2^nd respondent was acting or executing the agreement for lease of the trappers for and on behalf of the principal, the 2^nd respondent.
2. The exceptions to this general rule are (1) if the agent is undisclosed or partially disclosed, (2) if the agent lacks authority or exceeds it, or (3) if the agent entered into the contract in a personal capacity. None of them has been shown to exist in this case.
3. Consequently, even if the 1^st respondent was greatly aggrieved by the 2^nd respondent and yet he is overseas, the buck ultimately rests with the 2^nd respondent and is the one to pursue. It was thus not tenable to sue the agent, the appellant herein, along with her known principal the 2^nd respondent herein. There was nothing demonstrated to warrant that course. The learned trial court was therefore in error to find the appellant liable and proceed to enter judgment against her with the 2^nd respondent.
4. Consequently, I allow the appeal. The judgment against the appellant is hereby set aside and substituted with a judgment dismissing the case by the 1^st respondent against the appellant. For clarity, the judgment in respect of the 2^nd respondent remains against him alone.
5. The appellant gets the costs of the appeal to be shared between the two respondents equally and also the costs of the suit against her in the magistrates court.

Dated, Signed and Delivered at Kiambu this 12^th day of July, 2024.

In the presence of:

Nyamagwa for the Appellant.

N/A for the Respondent.

Eutropia Court Assistant.