State Law VS ANNAH ADHIAMBO/TA AWASI MINI HADWARE AND BOM AWASI PAG HIGH SCHOOL

1. The claim before the trial court was for the payment of monies owed to the respondent herein who was awarded a contract by the appellant to construct a twin-dormitories vide contract awarded on 13/10/2016 at a fixed sum of Kshs 5,785,820. The respondent averred that she completed the project on 4/02/2019 and handed over to the building to the appellant. The respondent pleaded that despite completing the project, the appellant had only paid a sum of Kshs 2,500,000/- leaving the balance of Ksh 3,285,820 unpaid.
2. The respondent’s suit therefore was for a breach of contract and demand for the payment of the balance of Kshs 3,285,820 together with interest from 4/02/2019.
3. The appellant duly entered appearance and filed it’s statement of defence admitting the use of the building from 4/02/2019. The appellant averred that the ablution block was not constructed as per the provided floor plans. It also admitted paying the sum of Kshs 2,500,000/-  but maintained   that the balance can only be paid upon completion of the abolition block and a proper valuation be done.
4. The matter proceeded to hearing where the respondent’s evidence was as stated in the aforegoing paragraphs.
5. In cross examination, the respondent stated that she had constructed the building in accordance with the bill of quantities and drawing plans and that the school principal advised her to use blocks instead of bricks and the said principal was present when the final inspection was done.
6. PW-2 Joshua Ouma Omollo stated that he was on the ground when the works were ongoing. He testified that the public works official and the principal were in-charge of inspecting the works. This witness stated that a report on the completion of the work was done by Charles Owaga, a public works official and a certificate of completion was duly issued on 4/02/2019. That the money intended for ablution blocks was converted into building blocks as there was no sewage system in the area.
7. PW-3 Charles Ogwang, a public works inspector stated that the building works at the school were complete to some level as the ablution block was incomplete. This witness testified that he did a report for the payment. He stated that the project was not practically complete as the ablution block was incomplete. At the time that he gave his  testimony he stated that he had already left the area and was not aware whether the work was eventually completed.
8. DW-1 was Magori Joseph, was the appellant’s principal and his evidence was that the respondent was to construct an ablution block and a twin dormitory and that the bill of quantities was fixed by the contractor although the ablution block was incomplete. He maintained that the value of works done was 3, 572,006.10 and the project was therefore not handed over.
9. DW-2 was Michale Owuro Nyamori, his evidence was that according to his report, the foundation type of the building was altered. He went ahead to state there were structural alterations made by the contractor in variation with the initial drawings and the bill of quantities.
10. DW-3 was Boniface Toto Abade testimony was that he prepared the report date 2/8/22 over the works done by the respondent. That as per his report, the value of the works done was kshs 3, 636, 910.
11. The at the conclusion of the hearing, the trial magistrate ordered the appellant to release to the respondent Kshs 1,072,006.10/- and deposit the sum of Kshs 2,213,814/- in court and in default, the respondent be at liberty to execute the entire sum.
12. Upon entry of judgment as aforesaid, the appellant being aggrieved moved this court on appeal setting out the following grounds;
    1. The learned trial magistrate erred by dismissing the appellant’s counterclaim which finding was against the weight of evidence and the plaintiff’s own admission that they did not complete the construction as per the bill of quantities and drawings as they did not construct the abolition block.
    2. The learned trial magistrate erred in failing to appreciate that there was no evidence presented by the respondent’s that demonstrated that the construction was executed as per the bill of quantities and the drawings or exposing the value of the work they had done and that the only evidence that that showed the value of the work done emanated from the appellant’s expert witness.
    3. The magistrate applied wrong principles when he arrived at the finding that both appellant’s expert reports were prepared and concluded by the parties who were not present or involved in the execution of the construction and was done in the absence of the respondent thus rendering them un-credible, therefore failing to appreciate the role of the expert evidence and the facts that the un-challenged reports were prepared from the actual status of the subject works.
    4. The trial magistrate erred by rendering contradictory and inconsistent judgment when he entered judgment in favour of the plaintiff for special damages 1,072,006.10 as presented by the expert’s inspection report (being the balance adduced after subtracting the value of the measured work done from the amount already paid to the respondent) and at the same time found the evidence of the said expert not credible. The court heavily relied in that valuation and the appellant’s pleadings which were all hinged on the said inspection report and then ironically states that they were not credible witnesses. The judgment blew hot and cold on the same testimonies.
    5. The trial magistrate erred by ordering a joint valuation report be done after judgment has been rendered. Ignoring the fact that the appellant had requested for the same in the interest of justice before the close of the defence case and during the course of the mentions wherein parties consented  to do a joint valuation report but the plaintiff took hard stance and eventually declined thus rendering the judgment conditional, inconclusive and openly biased to the appellant who was not the offending party.
    6. The trial magistrate erred by affixing a condition that the Kshs 2,213,814/- be deposited in court within 60 days failure to which the execution do issue for the entire contract amount unless a joint report is done when it was crystal clear during the trial that it is the respondent who declined to attend to the joint report and thereby unfairly condemning the appellant and the same is inconsistent and goes against its own finding  that the evidence shows that the construction was not complete.
    7. The learned trial magistrate erred by rendering inconsistent, openly biased and inconclusive yet final judgment and by so doing purports to litigate on behalf of the respondent who neither provided evidence as to the value of work done nor gave evidence to rebut the evidence by the appellant’s expert witnesses and admitted that they did not complete the construction as per the requirements.
    8. The trial magistrate erred by rendering judgment rewarding the plaintiff for the entire project when the plaintiff admitted that they did not complete the works and the court’s own finding that indeed the works was not completed, and hence going against public policy, and condones unjust enrichment from public coffers.
    9. The trial magistrate erred by completely the ignoring the appellant’s evidence on record, filed submissions and relied authorities and thereby arriving at an erroneous, unfair and inconclusive judgment which is not judiciously sound.
13. The appeal was canvassed by way of written submissions. The appellant submits that the trial magistrate misapprehended the facts of the case by dismissing the appellant’s counterclaim which was against the respondent’s admission that they had not completed the construction according to the bill of quantities. That the trial court applied wrong principles when considering the issue of expert reports prepared and filed which the trial magistrate nonetheless considered as stated in the appellant’s pleadings in awarding damages. The authority in SYT V TA (2019) eKLR has been cited.
14. The appellant submits that awarding the respondent amounts to unjust enrichment and contrary to public policy. That the trial court erred by awarding the respondent as she had not proved her case to the required standards and cites the authority in William Kabogo Gitau V George Thuo & 2 ors (2010) 1 KLR 526 and Damondar Jihabhai & Co. Ltd and another V Eustace Sisal Estates Ltd (1967) EA 153.
15. On the part of the respondent, it is submitted that the building was completed in 2019 and handed over to the appellant and is now in use. That the appellant’s allegation of defects and or failure to meet specifications is an afterthought as the 6 month’s defect-period passed without the appellant raising any issue.
16. That the documents produced by the appellant were unilaterally prepared by the appellant after filing of the suit and after 3 years had lapsed since the building was handed over and that the facts do not support the appellant’s case.
17. In support of its position the respondent cites the decision in Damondar Jihanbhai (supra) for the preposition that the role of the court’s in contract is to enforce and giving effect to a contract.

Analysis and determination.

1. This being a first appeal, the duty of the court is as was held in Mark Oiruri Mose vs. R (2013) eKLR thus;

….the Court is duty bound to revisit the evidence tendered before the trial court afresh, evaluate it, analyze it and come to its own independent conclusion on the matter but always bearing in mind that the trial court had the advantage of observing the demeanor of the witnesses and hearing them give evidence and give allowance for that.

1. Having examined the record of appeal, the memorandum of appeal and the submissions herein, there is no dispute the parties herein entered into contract for the construction of the appellant’s twin dormitory which was handed over to the appellant sometimes in the year 2019 and the same has been in use since then. There also is no dispute the appellant paid the sum of Kshs 2,500,000/- to the respondent, leaving a balance of kshs 3,285,820/- which remained unpaid as at the time of filing suit.
2. Taking the above into account, I am of the view that the following issues will adequately dispose of this appeal;
   1. Who was in breach of contract?
   2. The propriety of the judgment entered in the trial court.
   3. The appropriate orders to be made in the instant appeal.
3. In analyzing the above issues, it is not lost to the court that in every civil dispute, the burden of proof always lies on the plaintiff and the standard of proof is on a balance of probabilities pursuant to the provisions of Section 107-109 of the Evidence Act.
4. On the first issue; that, who was in breach of the contract, from the plaint, the respondent’s claim was for the payment of the sum of Kshs 3, 285,820/- and interest at 14% from the date of competition of the project. She particularized the instances of breach of contract by the appellant.
5. In support of her case, the respondent produced into evidence a letter of award, notification for tender award and acceptance by the respondent. The above documents taken into perspective wholesomely indicate that the respondent was to work on the project according to the bill of quantities also produced into evidence.
6. The cumulative effect of the pleadings and evidence tendered before that court shows that there was no provision for the construction of the ablution block as was confirmed by the respondent and DW-1, the appellant’s agent who was manning the project. The respondent also stated that the appellant changed the specifications of the project in terms of the materials to be used.
7. According to the appellant’s counterclaim filed in the trial court, the appellant pleaded breach of contract by the respondent for inter alia failing to complete the project in accordance with the bill of quantities and the architectural drawings, changing the building’s foundation without the consent of the project manager and failure to complete the ablution block.
8. In his oral testimony before the court, DW-1, the appellant’s principal stated that they had not paid the respondent as the work’s were incomplete and they requested for a report on the same. In cross examination, he stated there was no requirement for the construction of the ablution block according to the bill of quantities and the letter of offer and the award of the contract. DW-2 on his part produced into evidence a report he prepared in 2022 on the building. According to him, the contractor changed the structure of the building. DW-3 produced a report he prepared on 2/8/2022 detailing the works done by the respondent.
9. After considering the evidence, the trial court as a matter of fact made a finding that found the contract had no requirement for the construction of an ablution block. That the dormitory was already occupied by students, that the reports relied on by the appellant were prepared by strangers’ way after the suit had been filed who did not participate in the works at the initial stages. The trial magistrate indeed found that the appellants had never recalled the certificate issued to the respondent or made a formal demand to the respondent that the works were not complete.
10. From the above, it is not in question the entire transaction was a contractual undertaking governed by the laws of contract which states inter alia courts have no business rewriting contracts on behalf of the parties but to give effect to the parties intentions. On this regard I find guidance from the decision in Pius Kimaiyo Langat vs. Co-operative Bank of Kenya Ltd (2017) eKLR where the Court of Appeal stated that: -

We are alive to the hallowed legal maxim that it is not the business of Courts to rewrite contracts between parties, they are bound by the terms of their contracts, unless coercion, fraud or undue influence are pleaded and proved. 

1. It is discernable from the above authority that the court while sitting on this appeal is only minded in giving effect to the parties’ intentions in the contract produced into evidence. The parties were the ones setting the terms of the contract which terms are binding upon them to the letter unless the exceptions stated above are established.
2. This court has reanalyzed, re-scrutinized and re-evaluated the evidence on record and the decision by the trial court. There is no iota of doubt that the bill of quantities formed the basics of the contract. The works undertaken by the respondent were evaluated by PW-3 who was in charge of the project and submitted his report on 4/2/2019 and that the project had already been handed over and used by the appellant. According to him, there was variance of the project but the client (appellant) was satisfied. He explained that the flush toilet could not be installed as the school had problems with water and had no sewage system.
3. I have also considered the fact that the reports relied by the appellants were authored post event, after the institution of the suit; the suit was filed on 17^th February, 2022 yet the reports were prepared on 14/7/2022 and 2/8/2022 respectively.
4. This court takes cognizance of the fact that the project was handed over and put into use by the appellant in 2019 and the post event reports produced by the appellant were authored by strangers who took no part in the supervision of the commissioned works wherefore the said reports are inconsequential and of no probative value.
5. As provided for in Section 112 of the Evidence Act, the burden of proving facts specially within the knowledge of a party lies with that party, whose case stands to crumble in the event of it’s failure to discharge the burden. The Section Provides;

‘In civil proceedings, when any fact is especially within the knowledge of any party to those proceedings, the burden of proofing of disproving that fact is upon him.’

1. It is noteworthy that the report dated 4/2/2019 produced by PW-3 who was the appellant’s agent did not qualify the work already done. In fact there is no mention that the work is incomplete. The appellant, in my view,  deliberately chose not to call it’s officers who supervised the work at the material time. Such obvious omission must attract an adverse inference in respect of the appellant’s case. The only reports produced by the appellant were, as statd herein above, the ones generated after the suit had been filed. In the case of   Financing Limited vs. Ezekiel Chebii & 14 others [2012] eKLR, the court was faced with a similar situation and it rendered itself as hereunder;

Where a party has custody or is in control of evidence which that party fails or refuses to tender or produce, the court is entitled to make adverse inference that if such evidence was produced, it would be adverse to such a party.   In the case of Kimotho –vs- KCB (2003) 1 EA 108 the court held that adverse inference should be drawn upon a party who fails to call evidence in his possession.”

1. Upon re- analysis of the evidence presented before the trial court, I find that indeed, the project was handed over to the appellant and who then put it into use. The attempt to dispute the competition of the building came late in the day and the preparation of reports way after the filing of the suit and occupation of the building is dishonest and a calculated move to deny the respondent of her rightful dues.
2. In conclusion this court finds that the appellant was economical with the truth, it failed to adduce before the trial court, the project progress reports that it had in it’s possession and the reports authorizing the use of the building.
3. Despite taking unreserved possession and putting the building into use, the appellant ignored and or deliberately failed to honour it’s part of the bargain by making full payment of the contract price to the respondent.
4. On the balance I find that the appellant is the one in breach of the contract.
5. The second issue is one the propriety of the judgment in the trial court. The appellant in this appeal contends that the trial magistrate erred in ordering a joint valuation report post judgment despite finding that the project was incomplete.
6. I have on my part perused the judgment and it is indeed true that the court found the project was not done to completion and in the end, ordered a joint valuation report by the parties herein and the balance of Ksh 2,213,814/- be  deposited  in court pending the preparation of the joint report. It ordered the appellant to release to the respondent the sum of Kshs 1,072,006.10.
7. Putting the above into perspective, the trial court indeed made correct observation of the status of the performance of the contract and the findings made in the interest of justice. On my part, I find that the project was handed over to the appellant of 4/2/2019 after the report by PW-3. This should have been the time that the work done by the respondent should have been valued as that is the time the appellant took possession of and moved into the house.
8. I note that at the time of preparation of the reports in 2022, the building must due to natural causes have undergone some wear and tear either from use or elements of nature and the reports made do not present a correct position of the work done as at the time of handing over in 2019.
9. On the third issue and having made foregoing finding of fact and law, I find that the appeal partially succeeds to the extent that the respondent be paid the sums due and owing as at 4/2/2019 and the sum of Kshs 1, 072,006.10/- be released to the respondent while the deposit held in court if any, be released back to the appellant after payment of balance if any to the respondent.
10. As this appeal is partially successful, each party shall bear its own costs on the appeal and the costs in the trial court is awarded to the respondent.

Delivered, Dated, and Signed at Kisumu this 27^thday of August   2024