(Being an appeal from the judgment and decree of Hon. S. G. Gitonga (Mrs), Adjudicator delivered on 10th March 2023 in Milimani Small Claims Court SCCOMM. E4853 of 2022)
JUDGMENT
1. This appeal arises from a judgment of the Small Claims Court (SCC) dated 10th March 2023 in which the court dismissed the respondent’s claim against the appellant for security guard services for the period 17th July 2020 and 20th July 2022 in the sum of KShs 924,320/= and also dismissed the appellant’s counterclaim against the respondent for a refund of KShs 453,256/= as payment made to the respondent for security services invoiced but not rendered. The SCC held that both parties had failed to prove their respective claims on a balance of probability and dismissed them. The appellant has appealed against the dismissal of its counterclaim.
2. The case before the SCC was heard by viva voce evidence. The respondent called three witnesses: CW 1, Raphaella Daballen, CW 2, Sagara Philip and CW 3, Abdirizaack Hussein. The appellant also called three witnesses DW 1, Rose Gacheru; DW 2, Kevin Munyao Mutuku and DW 3, Michael Kagwe Ndung’u. Each of the witnesses had recorded a statement which was adopted as evidence in chief, and the witness was cross-examined thereon.
3. There is no dispute that on 17th July 2020, the parties entered into a contract for the provision of security services by the respondent to the appellant at the Ilaut site. The signed contract was produced as an exhibit, and there was no contest on the terms thereof. Under clause 2, the duration of the contract was indefinite unless or until terminated by either party by giving the other not less than one month’s written notice. Under clause 4, the charges were KShs 26,500/= per guard per month exclusive of VAT.
4. According to the respondent, through the evidence of its witnesses, it fully performed its part of the contract, providing guard security services as per the contract and submitted invoices to the appellant totaling KShs 1,313,976 for services rendered for the period 26th October 2020 to 25th March 2022 for settlement. However, the appellant paid KShs 415,136/= only. The respondent thus terminated the contract for non-payment through a letter to the appellant dated 20th April 2022, effective 20th May 2022.
5. According to the respondent, at the time of issuance of the notice of termination, the unpaid invoices amounted to KShs 862,840/= and the amount payable for the notice period was KShs 61,480/=, making the total outstanding sum KShs 924,320/= which the respondent claimed from the appellant.
6. The appellant, on his part, alleged that, in fact, the respondent was the one who breached the contract. The appellant claimed that the respondent never provided security services as per the contract terms, as it never deployed two security guards, one for the day and the other for the night, to guard the site, among other breaches. The appellant therefore counterclaimed for a sum of KShs 453,256/= (inclusive of withholding tax paid to KRA), which it had paid to the respondent as per invoices submitted by the respondent, but for services that were never rendered.
7. The learned Adjudicator, after analyzing the evidence, concluded that both parties had failed to prove their respective claims against each other on a balance of probability. Consequently, she dismissed the claims and directed each party to bear its own costs.
8. The appellant was dissatisfied with the decision dismissing the counterclaim and filed the present appeal through the memorandum dated 24th July 2024. It raised six grounds as follows:
a. The learned Adjudicator erred in law and fact by finding that payments made by the appellant to the respondent were proper even though the respondent had breached the terms of the contract, and as such, the appellant was under no obligation to pay for the security services.
b. The learned Adjudicator erred in law and fact by finding that the appellant did not prove its claim for a refund of KShs 453,256/=.
c. The learned Adjudicator erred in law and fact by failing to find that the respondent was liable to restitute the appellant for payments made under the contract despite finding that the respondent had fraudulently misrepresented itself to the appellant on material facts which occasioned the payments.
d. The learned Adjudicator erred in law and fact by finding that the appellant’s failure to dispute the respondent’s fraudulent invoices within the contractual timelines denied them the right to a refund.
e. The learned Adjudicator erred in law and fact by finding that the appellant failed to prove its counterclaim.
f. The learned Adjudicator erred in law and fact by finding that the appellant was not entitled to the costs of the suit.
9. The appellant therefore prays that the appeal be allowed, the decision of the SCC be set aside, and an order for the refund of the KShs 453,256/= by the respondent to the appellant and the costs of the claim before the SCC and of the appeal herein be awarded to the appellant. The appellant also prays that the court may make such further or other orders as are just in the circumstances of the appeal.
10. The appeal was disposed of by written submissions filed by learned counsels for the parties. The same are considered in the analysis that follows.
11. An appeal to this court from the SCC is on points of law only as provided for under section 38 of the SCC Act. So, the first issue for this court to consider is whether the grounds of appeal raised by the appellant are on points of law only.
12. Learned counsel for the appellant would do well, in drafting the grounds of appeal from the SCC to this court, to refer and be guided by the Court of Appeal’s observation in the case of Independent Electoral and Boundaries Commission & another v Mule & 3 others [2014] KECA 890 (KLR) that:
“Those points in an appeal of the kind before us, being from an election court’s decision, are further circumscribed by Section 85A of the Elections Act which limits appeals to the Court of Appeal to matters of law only. It is therefore quite strange and improper that each of the seventeen grounds, without exception, commences with a standard expression “the judge erred in fact and law” or “the learned Judge erred in law and in fact.” Clearly the drafters of the memorandum did not have the legal provision in active contemplation. Had they done so, they would have found that by invoking factual errors, they were inviting jurisdictional objections to their entire appeal.”
13. From this decision, it bears remembering that invoking factual errors in an appeal based on points of law only may cause the same to be struck off the record. All the same, this court has to consider only the points of law arising from the above grounds.
14. Going through the submissions of learned counsel for the appellant, I note that the appellant reduced all the grounds of appeal into one issue, that is, whether the trial court’s dismissal of the appellant’s counterclaim was proper in law. Luckily, the submissions by learned counsel for the appellant are based entirely on this point of law inasmuch as the appellant keeps adverting to “erred in law and fact” in the grounds of appeal.
15. Learned counsel for the appellant submits that they have no problem with the learned Adjudicator’s appraisal of the facts, as the same was accurate, and this court should adopt the same. He has cited the well-established principle that where an appellate court’s jurisdiction is confined to points of law, the court must resist the temptation to interfere with the trial court’s findings of fact and confine itself to issues of law. This position was stated, for instance, by the Court of Appeal in M’Riungu v. Republic [1983] KLR 455, where it was held that:
“where a right of appeal is confined to question of law, an appellate court has loyalty to accept the findings of fact of the lower court(s) and resist the temptation to treat findings of fact as holdings of fact and law and it should not interfere with the decision of the trial court or the first appellate court unless it is apparent that on evidence, no reasonable tribunal could have reached that conclusion, which would be the same as holding that the decision is bad in law”.
16. Therefore, in the present appeal, where the SCC appropriately dealt with the evidence, this court has no right to interfere with the findings based thereon unless this court finds that no reasonable tribunal could have reached the decision made by the SCC.
17. One more important feature of the SCC to bear in mind while considering the appeal is that the SCC Act exempts the Small Claims Court’s proceedings from the rigid application of the standards of evidence applicable in other court proceedings and permits the court to include as evidence any material that it deems credible or trustworthy (emphasis by underlining supplied). It follows from this provision that it is largely upon the Adjudicator to determine the material to rely upon. Section 32 of the Act provides that the strict evidentiary rules applicable in other courts are not wholly applied in the Small Claims Court. It further provides that the Court may admit as evidence any oral or written testimony, record, or other material even though the same is not admissible as evidence in any other Court under the law of evidence (emphasis supplied). This means the Adjudicator has the discretion to admit any evidence which may help establish whether or not the claim is proved. For me, this provision further limits the jurisdiction of the High Court to issues of law only. The issue of considering the facts before the trial court is further limited by the procedure applicable before the SCC, which is unlike the procedure before the magistrates’ courts. Section 3 of the SCC Act, on the guiding principles of the court, provides inter alia that the court shall be guided by the principles of judicial authority prescribed under Article 159(2) of the Constitution, and without prejudice to the same, the Court shall adopt such procedures as the Court deems appropriate to ensure fairness of process and simplicity of procedure (emphasis supplied). The fairness of the process is further reinforced under Part IV, which is the substantive part that deals with the procedure before the court. Section 17 of the Act, which falls under that part provides that:
S. 17. Subject to this Act and Rules, the Court shall have control of its own procedure in the determination of claims before it and, in the exercise of that control, the Court shall have regard to the principles of natural justice.
18. Therefore, according to me, the principles of natural justice rather than the technical procedural rules under the CPR take centre stage in an SCC hearing. In the case of Justice Amraphael Mbogholi Msagha v. Chief Justice of the Republic of Kenya & 7 Others Nairobi HCMCA No. 1062 of 2004; [2006] 2 KLR 553; [2006] eKLR, the Court, in discussing the rules of natural justice, cited De Smith and Brazier, Constitutional and Administrative Law 6th Edition (Penguin United Kingdom: 1989) (pages 557-558), which states:
“The content of natural justice is therefore flexible and variable. All that is fundamentally demanded of the decision maker is that his decision in its own context be made with due regard for the affected parties’ interests and accordingly be reached without bias and after giving the party or parties a chance to put his or their case....”
19. Indeed, the technicality of procedure and strict rules of evidence as applied in the magistrates’ court were excluded so that the Adjudicator could achieve one of the main objectives of the court, which is provided under section 34 of the Act, on expeditious disposal of cases with quite onerous provisions that:
S. 34 (1) All proceedings before the Court on any particular day so far as is practicable shall be heard and determined on the same day or on a day to day basis until final determination of the matter which shall be within sixty days from the date of filing the claim.
(2) Judgment given in determination of any claim shall be delivered on the same day and in any event, not later than three (3) days from the date of the hearing.
(3) The Court may only adjourn the hearing of any matter under exceptional and unforeseen circumstances which shall be recorded and be limited to a maximum of three adjournments.
20. While proceeding under the CPR before the magistrate’s court, it is practically impossible to hear and determine every case that comes before it in a day’s sitting. However, for the SCC, the strict compliance with the provisions of the SCCA, by excluding the strict evidentiary rules and technicalities of procedure under the CPR, and through the adoption of a flexible procedure by the learned Adjudicator, can achieve this. Therefore, for me, the provisions of the SCCA would best be applied with the court proceeding more through the alternative means of dispute resolution of negotiation, and conciliation between parties with the court’s guidance, as well as summary determinations rather than laborious taking of notes from witnesses, analyzing evidence, sifting through pages of lengthy submissions by learned counsels, and rendering lengthy judgments as was the case herein. This would be achievable with an eye on the observance of the rules of natural justice when considering a claim.
21. My view, therefore, is that the responsibility of this court when considering an appeal from the SCC is to consider the legality and reasonableness of the decision of the learned Adjudicator. If this court is satisfied that the SCC has made a reasonable evaluation of the facts and properly considered and applied the law, then it will not interfere with its findings and determination. The converse would also be true. That is where the law was not properly considered and/or applied, or where the decision does not seem reasonable from the facts before the court, then this court will interfere. Given the provisions of the SCC Act, excluding to a large extent the strict provisions of the law of evidence and the technicalities of the CPR, I would find that the standard of reasonableness would be that of an ordinary person on the street.
22. Learned counsel for the appellant submits that, having appropriately dealt with the facts of the case and applied the law of contract and found that the respondent had breached the terms of the contract by not providing security services at the site as provided for in the contract, the learned Adjudicator misapplied the law to the facts by refusing to order a refund of the monies paid by the appellant. The SCC thereby allowed the respondent to benefit unjustly from the breach of contract. This court needs to determine the veracity of that assertion.
23. In his judgment, the learned Adjudicator found on the claim by the respondent for payment for services rendered that the respondent breached the terms of the contract, and the appellant was under no obligation to pay for the security services. It is on those findings that the appellant anchors his appeal, contending that the SCC ought to have allowed the counterclaim for a refund of the sums paid on the contract.
24. On the appellant’s counterclaim, the learned Adjudicator found that the appellant had failed to raise any queries on the invoices raised by the respondent within 30 days, as provided for under clauses 4.5 and 4.7 of the contract. Consequently, the respondent was not entitled to a refund of KShs 453,256/= as per the counterclaim.
25. On this later finding, learned counsel for the appellant submits that the learned Adjudicator erred by strictly adhering to the written terms of the contract in dismissing the appellant’s counterclaim and thereby aiding an unjust enrichment. That is an absurd submission for a party that pleads breach of contract. It is a hallowed principle of the law of contract that parties are bound by the terms of their contract, and the court will not unjustifiably interfere with the same, as was held in the case cited by learned counsel for the respondent of National Bank of Kenya Ltd v Pipeplastic Samkolit (K) Ltd & another [2001] KECA 362 (KLR) that:
“A Court of law cannot re-write a contract between the parties. The parties are bound by the terms of their contract, unless coercion, fraud or undue influence are pleaded and proved.”
26. The duty of the court is to construe the contract and any terms implied in it and give effect to them.
27. The learned Adjudicator found with respect to the evidence of CW 1 that there were discrepancies in her testimony because she claimed to be a guard duly employed by the respondent from May 2021 to May 2022, and that she neither had any training nor any authorization as a guard, and further that she had been employed by the area chief rather than the respondent. Further, she claimed to have been present at the site when Kevin, DW 2, visited, but when she was told to physically identify him, she was unable to do so despite previously alleging to know him quite well.
28. In view of those findings, it behooves this court to reproduce the testimony of CW 1 before the SCC to see whether the learned Adjudicator’s findings were in line with it.
29. The testimony of CW 1 before the SCC was brief. She adopted her witness statement dated 16th September 2022 as her evidence after which she was cross-examined. In cross-examination she stated that:
“I work with Ismax Security since 2021. Before this, I was not employed. I am a trained guard. I trained at home. Ismax did not train me as a guard. The chief told me about this job after he got communication from Ismax Security. The chief is from my father’s family he is like my uncle. I worked from May 2021 to December 2021 then I proceeded for maternity leave. I left my work to the night guard. He was now guarding day and night. There was a visitor’s book. I did not fill my name in the visitor’s book. When the respondent’s agent Kevin came to site I was not there. I had gone to clinic. I left work in November 2021.”
30. In re-examination, the witness said:
“I started work in May 2021 until February 2022. I went for maternity in December and came back in February 2022. I then stopped working in May 2022. Since we were informed there is no money to pay us.”
31. It is apparent from the testimony of CW 1 as reproduced above that there are many factual inaccuracies in the learned Adjudicator’s findings about her evidence, yet the learned Adjudicator based her decision on those inaccurate findings.
32. The finding that CW 1 was employed by the area chief and not by the respondent herein, and that she was untrained and unauthorized, was not based on the evidence adduced at the hearing. CW 1 said clearly that she was employed by Ismax Security Services, the respondent herein. She explained further that she got her said employment with the respondent through communication from the area chief, Sagaram, CW 2 who was her uncle. She said that CW 2 was also the one who was liaising with the respondent on the issue of the guards’ payment. The other guard she was working with was George Sagaram. It was not, as found by the learned Adjudicator, that the area chief was the one who had employed them.
33. The learned Adjudicator also found that CW 1 had said that she was around when DW 2 visited the site. That was in clear contrast to the testimony by CW 1 and supported by CW 2 that she was not on site, as she had gone to the clinic. I have not seen anywhere in her testimony where CW 1 alleged that she could identify DW 2, and there is no recorded testimony of her failing to point out CW 2 as found by the learned Adjudicator. Yet the learned Adjudicator faulted her evidence on that basis. I find those to be errors made by the learned Adjudicator in making findings that were not based on evidence on record, and therefore errors of law.
34. Further, the learned Adjudicator found that the respondent did not have security guards on site for the period of five days when Kevin Mutuku, DW 2 was there. He appears to have entirely relied on the evidence of DW 2, who alleged that a guard by the name of Safari, who was supposed to be on duty at the time was called to the site but he never showed up.
35. That finding by the SCC clearly overlooked the evidence of CW 2 who said that in fact, there was a guard by the name of George Sagaram present when DW 2 was there. Kevin never explained from whom he received the information that the alleged Safari was the guard supposed to be on duty, and the allegation that the said Safari was a “boda boda” operator who could not be performing guard duties. Yet again, even if that finding was correct, which I have found it was not, there was no other evidence that before that and afterwards, there were no guards on site. The appellant depended on suppositions rather than concrete evidence for its assertion that the respondent had never rendered any guard security services at all at the site.
36. The learned Adjudicator failed to consider the evidence of CW 2, Philip Sagaram, who was emphatic that the respondent provided security services to the appellant with two guards on site, CW 1 and one George Sagaram, for the entire period. He said that his office was next to the site and the two guards reported to him, under an arrangement he had with the respondent.
37. More importantly, CW 2 said that when Kevin DW 2 visited the site CW 1, had gone to the clinic, and that George, who was a guard employed by Ismax, was present. He denied the allegations by Kevin, DW 2, that he was detained at the site by the respondent’s guards. CW 2 explained quite clearly the incident that occurred involving two National Police Reservist (NPR) Guards and Kevin. He explained that these two guards, who had since been employed by the Kenya Power & Lighting Company, were initially employed, through him, by the appellant herein, Whitespace Technologies. That was before Whitespace engaged the respondent to provide security services on that site. Apparently, the appellant had failed to pay these two guards during that period. Therefore, when DW 2 went to the site, they demanded their pay from him. The issue was sorted out when Ms Rose from the appellant company sent KShs 3,000/= to the two guards. It was not an issue with the respondent’s guards. Therefore, the appellant turning the whole issue around to allege that it was caused by the absence of the respondent’s guards on site was not proper. CW 2’s evidence in his written statement was quite clear that the appellant’s guard George, was on site when the incident occurred.
38. It is apparent that in his judgment, the learned Adjudicator failed to consider the evidence of CW 2 at all in his analysis. Secondly, he failed to appraise that evidence alongside that of DW 2, choosing to believe DW 2 without offering any reason why he did not find CW 2 to be a credible witness. It would be apparent that Kevin, DW 2 and by extension, the appellant chose to sensationalize the whole issue due to the demand by the two NPR guards that they be paid their dues previously unpaid by the appellant, because CW 2 said that the incident was not to the magnitude of threatening to burn the appellant’s vehicle as alleged by the appellant. In any case, it was not caused by the respondent’s guards as alleged.
39. No doubt, the provision of security services is a sensitive issue that must be taken very seriously. Nobody contracts for security services for the guards to be absent from duty. But even while acknowledging this fact, the contract between the appellant and the respondent made provision to accommodate such absence. Clause 3.4.2 of the contract envisaged a situation where a guard could be absent from site by providing that:
“Where a guard assigned to the Client is absent or is incapacitated for any reason, the Company shall provide a replacement guard with minimum practicable delay.”
40. Therefore, the fact that CW 1 was not on site when DW 2 visited could not be a reason to lead to the harsh conclusion by the learned Adjudicator that security services had never been provided by the respondent at all. Under those circumstances envisaged by the said clause, there is no provision that the respondent would be considered to have breached the contract. Even then CW2 testified that another guard, George Sagaram, was on site.
41. In whole, considering the case before the SCC on the standard of reasonableness, a common man should find the evidence of CW 1 and CW 2 that the respondent had provided security services to the appellant to be more probable than that of DW 2 who was at the site for only a flitting moment, that the contract was in force. CW 1 and CW 2 were witnesses who were present on site all the time, and the evidence of Kevin, DW 2, who was only at the site for a few days, did not controvert it. For me, that evidence was not rebutted by the appellant’s witnesses nor impeached through cross-examination. Secondly, on the same standards of evaluating evidence before the SCC, I would find that the allegation by the appellant that the respondent had failed to keep proper records of vehicles and persons entering and leaving the premises was no proof that it did not have guards on site, and therefore a breach of the contract as found by the learned Adjudicator.
42. Looking at the learned Adjudicator’s judgment and the submissions of the appellant at the trial, I note that the learned Adjudicator appears to have taken word-for-word those submissions in her judgment without an independent evaluation of the evidence by both parties.
43. Failure to take into account material evidence by a trial court is an issue of law and the appellate court may interfere with the findings of the trial court where it is demonstrated that there was no evidence at all upon which the trial court’s findings were based or that the evidence relied upon was of such a nature that no reasonable tribunal, properly addressing its mind on it, could have made such findings as has been held in numerous decisions. (see for instance Bashir Haji Abdullahi v Adan Mohammed Nooru & 3 others [2014] KECA 707 (KLR). Considering the evidence tendered before the SCC, I find that the learned Adjudicator made findings that were not supported by the evidence on record, and that justifies this court’s interference with his decision.
44. Learned counsel for the appellant has strongly submitted that there was a fraudulent misrepresentation committed by the respondent in submitting the invoices for payment when no security services had been rendered. I agree with the submissions by learned counsel for the respondent in response thereto that the appellant did not raise the issue of fraud in its case against the respondent, and so the same cannot be taken up in this appeal. In any case, I have found that, based on the evidence tendered before the SCC, the learned Adjudicator’s finding that the respondent did not provide the security services was in error.
45. I am however, satisfied that, even though he made errors in his analyses of the evidence, the learned Adjudicator found correctly that the appellant was not entitled to recover the sums already paid to the respondent due to the provisions in clause 4 of the contract that all invoices would be assumed to be correct and payable should the client fail to raise any query with the company within 30 days of the date of the invoice. I believe the period of 30 days was provided for in the contract, given its nature, so that the appellant could verify whether indeed the services for which it had been invoiced had been rendered or not. Failure to raise a query meant that it was satisfied that the services had been rendered. I would add a second reason, which is what this court has found above, that in fact, security services were rendered and the appellant was obliged to pay for them.
46. From the foregoing analysis, it is apparent that the judgment of the learned Adjudicator dismissing the counterclaim is sustained but for the reasons which this court has given above. Consequently, I find the appeal has no merit, and it is dismissed, with costs to the respondent.
47. Orders accordingly.
48. Delivered, dated, and signed on the Virtual Platform, Microsoft Teams, this 30th day of April 2026.
ANDAYI W. F.
JUDGE
In the presence of:
... for the Appellant.
... for the Respondent.
Ummu: Court Assistant.
JUDGMENT
1. This appeal arises from a judgment of the Small Claims Court (SCC) dated 10th March 2023 in which the court dismissed the respondent’s claim against the appellant for security guard services for the period 17th July 2020 and 20th July 2022 in the sum of KShs 924,320/= and also dismissed the appellant’s counterclaim against the respondent for a refund of KShs 453,256/= as payment made to the respondent for security services invoiced but not rendered. The SCC held that both parties had failed to prove their respective claims on a balance of probability and dismissed them. The appellant has appealed against the dismissal of its counterclaim.
2. The case before the SCC was heard by viva voce evidence. The respondent called three witnesses: CW 1, Raphaella Daballen, CW 2, Sagara Philip and CW 3, Abdirizaack Hussein. The appellant also called three witnesses DW 1, Rose Gacheru; DW 2, Kevin Munyao Mutuku and DW 3, Michael Kagwe Ndung’u. Each of the witnesses had recorded a statement which was adopted as evidence in chief, and the witness was cross-examined thereon.
3. There is no dispute that on 17th July 2020, the parties entered into a contract for the provision of security services by the respondent to the appellant at the Ilaut site. The signed contract was produced as an exhibit, and there was no contest on the terms thereof. Under clause 2, the duration of the contract was indefinite unless or until terminated by either party by giving the other not less than one month’s written notice. Under clause 4, the charges were KShs 26,500/= per guard per month exclusive of VAT.
4. According to the respondent, through the evidence of its witnesses, it fully performed its part of the contract, providing guard security services as per the contract and submitted invoices to the appellant totaling KShs 1,313,976 for services rendered for the period 26th October 2020 to 25th March 2022 for settlement. However, the appellant paid KShs 415,136/= only. The respondent thus terminated the contract for non-payment through a letter to the appellant dated 20th April 2022, effective 20th May 2022.
5. According to the respondent, at the time of issuance of the notice of termination, the unpaid invoices amounted to KShs 862,840/= and the amount payable for the notice period was KShs 61,480/=, making the total outstanding sum KShs 924,320/= which the respondent claimed from the appellant.
6. The appellant, on his part, alleged that, in fact, the respondent was the one who breached the contract. The appellant claimed that the respondent never provided security services as per the contract terms, as it never deployed two security guards, one for the day and the other for the night, to guard the site, among other breaches. The appellant therefore counterclaimed for a sum of KShs 453,256/= (inclusive of withholding tax paid to KRA), which it had paid to the respondent as per invoices submitted by the respondent, but for services that were never rendered.
7. The learned Adjudicator, after analyzing the evidence, concluded that both parties had failed to prove their respective claims against each other on a balance of probability. Consequently, she dismissed the claims and directed each party to bear its own costs.
8. The appellant was dissatisfied with the decision dismissing the counterclaim and filed the present appeal through the memorandum dated 24th July 2024. It raised six grounds as follows:
a. The learned Adjudicator erred in law and fact by finding that payments made by the appellant to the respondent were proper even though the respondent had breached the terms of the contract, and as such, the appellant was under no obligation to pay for the security services.
b. The learned Adjudicator erred in law and fact by finding that the appellant did not prove its claim for a refund of KShs 453,256/=.
c. The learned Adjudicator erred in law and fact by failing to find that the respondent was liable to restitute the appellant for payments made under the contract despite finding that the respondent had fraudulently misrepresented itself to the appellant on material facts which occasioned the payments.
d. The learned Adjudicator erred in law and fact by finding that the appellant’s failure to dispute the respondent’s fraudulent invoices within the contractual timelines denied them the right to a refund.
e. The learned Adjudicator erred in law and fact by finding that the appellant failed to prove its counterclaim.
f. The learned Adjudicator erred in law and fact by finding that the appellant was not entitled to the costs of the suit.
9. The appellant therefore prays that the appeal be allowed, the decision of the SCC be set aside, and an order for the refund of the KShs 453,256/= by the respondent to the appellant and the costs of the claim before the SCC and of the appeal herein be awarded to the appellant. The appellant also prays that the court may make such further or other orders as are just in the circumstances of the appeal.
10. The appeal was disposed of by written submissions filed by learned counsels for the parties. The same are considered in the analysis that follows.
11. An appeal to this court from the SCC is on points of law only as provided for under section 38 of the SCC Act. So, the first issue for this court to consider is whether the grounds of appeal raised by the appellant are on points of law only.
12. Learned counsel for the appellant would do well, in drafting the grounds of appeal from the SCC to this court, to refer and be guided by the Court of Appeal’s observation in the case of Independent Electoral and Boundaries Commission & another v Mule & 3 others [2014] KECA 890 (KLR) that:
“Those points in an appeal of the kind before us, being from an election court’s decision, are further circumscribed by Section 85A of the Elections Act which limits appeals to the Court of Appeal to matters of law only. It is therefore quite strange and improper that each of the seventeen grounds, without exception, commences with a standard expression “the judge erred in fact and law” or “the learned Judge erred in law and in fact.” Clearly the drafters of the memorandum did not have the legal provision in active contemplation. Had they done so, they would have found that by invoking factual errors, they were inviting jurisdictional objections to their entire appeal.”
13. From this decision, it bears remembering that invoking factual errors in an appeal based on points of law only may cause the same to be struck off the record. All the same, this court has to consider only the points of law arising from the above grounds.
14. Going through the submissions of learned counsel for the appellant, I note that the appellant reduced all the grounds of appeal into one issue, that is, whether the trial court’s dismissal of the appellant’s counterclaim was proper in law. Luckily, the submissions by learned counsel for the appellant are based entirely on this point of law inasmuch as the appellant keeps adverting to “erred in law and fact” in the grounds of appeal.
15. Learned counsel for the appellant submits that they have no problem with the learned Adjudicator’s appraisal of the facts, as the same was accurate, and this court should adopt the same. He has cited the well-established principle that where an appellate court’s jurisdiction is confined to points of law, the court must resist the temptation to interfere with the trial court’s findings of fact and confine itself to issues of law. This position was stated, for instance, by the Court of Appeal in M’Riungu v. Republic [1983] KLR 455, where it was held that:
“where a right of appeal is confined to question of law, an appellate court has loyalty to accept the findings of fact of the lower court(s) and resist the temptation to treat findings of fact as holdings of fact and law and it should not interfere with the decision of the trial court or the first appellate court unless it is apparent that on evidence, no reasonable tribunal could have reached that conclusion, which would be the same as holding that the decision is bad in law”.
16. Therefore, in the present appeal, where the SCC appropriately dealt with the evidence, this court has no right to interfere with the findings based thereon unless this court finds that no reasonable tribunal could have reached the decision made by the SCC.
17. One more important feature of the SCC to bear in mind while considering the appeal is that the SCC Act exempts the Small Claims Court’s proceedings from the rigid application of the standards of evidence applicable in other court proceedings and permits the court to include as evidence any material that it deems credible or trustworthy (emphasis by underlining supplied). It follows from this provision that it is largely upon the Adjudicator to determine the material to rely upon. Section 32 of the Act provides that the strict evidentiary rules applicable in other courts are not wholly applied in the Small Claims Court. It further provides that the Court may admit as evidence any oral or written testimony, record, or other material even though the same is not admissible as evidence in any other Court under the law of evidence (emphasis supplied). This means the Adjudicator has the discretion to admit any evidence which may help establish whether or not the claim is proved. For me, this provision further limits the jurisdiction of the High Court to issues of law only. The issue of considering the facts before the trial court is further limited by the procedure applicable before the SCC, which is unlike the procedure before the magistrates’ courts. Section 3 of the SCC Act, on the guiding principles of the court, provides inter alia that the court shall be guided by the principles of judicial authority prescribed under Article 159(2) of the Constitution, and without prejudice to the same, the Court shall adopt such procedures as the Court deems appropriate to ensure fairness of process and simplicity of procedure (emphasis supplied). The fairness of the process is further reinforced under Part IV, which is the substantive part that deals with the procedure before the court. Section 17 of the Act, which falls under that part provides that:
S. 17. Subject to this Act and Rules, the Court shall have control of its own procedure in the determination of claims before it and, in the exercise of that control, the Court shall have regard to the principles of natural justice.
18. Therefore, according to me, the principles of natural justice rather than the technical procedural rules under the CPR take centre stage in an SCC hearing. In the case of Justice Amraphael Mbogholi Msagha v. Chief Justice of the Republic of Kenya & 7 Others Nairobi HCMCA No. 1062 of 2004; [2006] 2 KLR 553; [2006] eKLR, the Court, in discussing the rules of natural justice, cited De Smith and Brazier, Constitutional and Administrative Law 6th Edition (Penguin United Kingdom: 1989) (pages 557-558), which states:
“The content of natural justice is therefore flexible and variable. All that is fundamentally demanded of the decision maker is that his decision in its own context be made with due regard for the affected parties’ interests and accordingly be reached without bias and after giving the party or parties a chance to put his or their case....”
19. Indeed, the technicality of procedure and strict rules of evidence as applied in the magistrates’ court were excluded so that the Adjudicator could achieve one of the main objectives of the court, which is provided under section 34 of the Act, on expeditious disposal of cases with quite onerous provisions that:
S. 34 (1) All proceedings before the Court on any particular day so far as is practicable shall be heard and determined on the same day or on a day to day basis until final determination of the matter which shall be within sixty days from the date of filing the claim.
(2) Judgment given in determination of any claim shall be delivered on the same day and in any event, not later than three (3) days from the date of the hearing.
(3) The Court may only adjourn the hearing of any matter under exceptional and unforeseen circumstances which shall be recorded and be limited to a maximum of three adjournments.
20. While proceeding under the CPR before the magistrate’s court, it is practically impossible to hear and determine every case that comes before it in a day’s sitting. However, for the SCC, the strict compliance with the provisions of the SCCA, by excluding the strict evidentiary rules and technicalities of procedure under the CPR, and through the adoption of a flexible procedure by the learned Adjudicator, can achieve this. Therefore, for me, the provisions of the SCCA would best be applied with the court proceeding more through the alternative means of dispute resolution of negotiation, and conciliation between parties with the court’s guidance, as well as summary determinations rather than laborious taking of notes from witnesses, analyzing evidence, sifting through pages of lengthy submissions by learned counsels, and rendering lengthy judgments as was the case herein. This would be achievable with an eye on the observance of the rules of natural justice when considering a claim.
21. My view, therefore, is that the responsibility of this court when considering an appeal from the SCC is to consider the legality and reasonableness of the decision of the learned Adjudicator. If this court is satisfied that the SCC has made a reasonable evaluation of the facts and properly considered and applied the law, then it will not interfere with its findings and determination. The converse would also be true. That is where the law was not properly considered and/or applied, or where the decision does not seem reasonable from the facts before the court, then this court will interfere. Given the provisions of the SCC Act, excluding to a large extent the strict provisions of the law of evidence and the technicalities of the CPR, I would find that the standard of reasonableness would be that of an ordinary person on the street.
22. Learned counsel for the appellant submits that, having appropriately dealt with the facts of the case and applied the law of contract and found that the respondent had breached the terms of the contract by not providing security services at the site as provided for in the contract, the learned Adjudicator misapplied the law to the facts by refusing to order a refund of the monies paid by the appellant. The SCC thereby allowed the respondent to benefit unjustly from the breach of contract. This court needs to determine the veracity of that assertion.
23. In his judgment, the learned Adjudicator found on the claim by the respondent for payment for services rendered that the respondent breached the terms of the contract, and the appellant was under no obligation to pay for the security services. It is on those findings that the appellant anchors his appeal, contending that the SCC ought to have allowed the counterclaim for a refund of the sums paid on the contract.
24. On the appellant’s counterclaim, the learned Adjudicator found that the appellant had failed to raise any queries on the invoices raised by the respondent within 30 days, as provided for under clauses 4.5 and 4.7 of the contract. Consequently, the respondent was not entitled to a refund of KShs 453,256/= as per the counterclaim.
25. On this later finding, learned counsel for the appellant submits that the learned Adjudicator erred by strictly adhering to the written terms of the contract in dismissing the appellant’s counterclaim and thereby aiding an unjust enrichment. That is an absurd submission for a party that pleads breach of contract. It is a hallowed principle of the law of contract that parties are bound by the terms of their contract, and the court will not unjustifiably interfere with the same, as was held in the case cited by learned counsel for the respondent of National Bank of Kenya Ltd v Pipeplastic Samkolit (K) Ltd & another [2001] KECA 362 (KLR) that:
“A Court of law cannot re-write a contract between the parties. The parties are bound by the terms of their contract, unless coercion, fraud or undue influence are pleaded and proved.”
26. The duty of the court is to construe the contract and any terms implied in it and give effect to them.
27. The learned Adjudicator found with respect to the evidence of CW 1 that there were discrepancies in her testimony because she claimed to be a guard duly employed by the respondent from May 2021 to May 2022, and that she neither had any training nor any authorization as a guard, and further that she had been employed by the area chief rather than the respondent. Further, she claimed to have been present at the site when Kevin, DW 2, visited, but when she was told to physically identify him, she was unable to do so despite previously alleging to know him quite well.
28. In view of those findings, it behooves this court to reproduce the testimony of CW 1 before the SCC to see whether the learned Adjudicator’s findings were in line with it.
29. The testimony of CW 1 before the SCC was brief. She adopted her witness statement dated 16th September 2022 as her evidence after which she was cross-examined. In cross-examination she stated that:
“I work with Ismax Security since 2021. Before this, I was not employed. I am a trained guard. I trained at home. Ismax did not train me as a guard. The chief told me about this job after he got communication from Ismax Security. The chief is from my father’s family he is like my uncle. I worked from May 2021 to December 2021 then I proceeded for maternity leave. I left my work to the night guard. He was now guarding day and night. There was a visitor’s book. I did not fill my name in the visitor’s book. When the respondent’s agent Kevin came to site I was not there. I had gone to clinic. I left work in November 2021.”
30. In re-examination, the witness said:
“I started work in May 2021 until February 2022. I went for maternity in December and came back in February 2022. I then stopped working in May 2022. Since we were informed there is no money to pay us.”
31. It is apparent from the testimony of CW 1 as reproduced above that there are many factual inaccuracies in the learned Adjudicator’s findings about her evidence, yet the learned Adjudicator based her decision on those inaccurate findings.
32. The finding that CW 1 was employed by the area chief and not by the respondent herein, and that she was untrained and unauthorized, was not based on the evidence adduced at the hearing. CW 1 said clearly that she was employed by Ismax Security Services, the respondent herein. She explained further that she got her said employment with the respondent through communication from the area chief, Sagaram, CW 2 who was her uncle. She said that CW 2 was also the one who was liaising with the respondent on the issue of the guards’ payment. The other guard she was working with was George Sagaram. It was not, as found by the learned Adjudicator, that the area chief was the one who had employed them.
33. The learned Adjudicator also found that CW 1 had said that she was around when DW 2 visited the site. That was in clear contrast to the testimony by CW 1 and supported by CW 2 that she was not on site, as she had gone to the clinic. I have not seen anywhere in her testimony where CW 1 alleged that she could identify DW 2, and there is no recorded testimony of her failing to point out CW 2 as found by the learned Adjudicator. Yet the learned Adjudicator faulted her evidence on that basis. I find those to be errors made by the learned Adjudicator in making findings that were not based on evidence on record, and therefore errors of law.
34. Further, the learned Adjudicator found that the respondent did not have security guards on site for the period of five days when Kevin Mutuku, DW 2 was there. He appears to have entirely relied on the evidence of DW 2, who alleged that a guard by the name of Safari, who was supposed to be on duty at the time was called to the site but he never showed up.
35. That finding by the SCC clearly overlooked the evidence of CW 2 who said that in fact, there was a guard by the name of George Sagaram present when DW 2 was there. Kevin never explained from whom he received the information that the alleged Safari was the guard supposed to be on duty, and the allegation that the said Safari was a “boda boda” operator who could not be performing guard duties. Yet again, even if that finding was correct, which I have found it was not, there was no other evidence that before that and afterwards, there were no guards on site. The appellant depended on suppositions rather than concrete evidence for its assertion that the respondent had never rendered any guard security services at all at the site.
36. The learned Adjudicator failed to consider the evidence of CW 2, Philip Sagaram, who was emphatic that the respondent provided security services to the appellant with two guards on site, CW 1 and one George Sagaram, for the entire period. He said that his office was next to the site and the two guards reported to him, under an arrangement he had with the respondent.
37. More importantly, CW 2 said that when Kevin DW 2 visited the site CW 1, had gone to the clinic, and that George, who was a guard employed by Ismax, was present. He denied the allegations by Kevin, DW 2, that he was detained at the site by the respondent’s guards. CW 2 explained quite clearly the incident that occurred involving two National Police Reservist (NPR) Guards and Kevin. He explained that these two guards, who had since been employed by the Kenya Power & Lighting Company, were initially employed, through him, by the appellant herein, Whitespace Technologies. That was before Whitespace engaged the respondent to provide security services on that site. Apparently, the appellant had failed to pay these two guards during that period. Therefore, when DW 2 went to the site, they demanded their pay from him. The issue was sorted out when Ms Rose from the appellant company sent KShs 3,000/= to the two guards. It was not an issue with the respondent’s guards. Therefore, the appellant turning the whole issue around to allege that it was caused by the absence of the respondent’s guards on site was not proper. CW 2’s evidence in his written statement was quite clear that the appellant’s guard George, was on site when the incident occurred.
38. It is apparent that in his judgment, the learned Adjudicator failed to consider the evidence of CW 2 at all in his analysis. Secondly, he failed to appraise that evidence alongside that of DW 2, choosing to believe DW 2 without offering any reason why he did not find CW 2 to be a credible witness. It would be apparent that Kevin, DW 2 and by extension, the appellant chose to sensationalize the whole issue due to the demand by the two NPR guards that they be paid their dues previously unpaid by the appellant, because CW 2 said that the incident was not to the magnitude of threatening to burn the appellant’s vehicle as alleged by the appellant. In any case, it was not caused by the respondent’s guards as alleged.
39. No doubt, the provision of security services is a sensitive issue that must be taken very seriously. Nobody contracts for security services for the guards to be absent from duty. But even while acknowledging this fact, the contract between the appellant and the respondent made provision to accommodate such absence. Clause 3.4.2 of the contract envisaged a situation where a guard could be absent from site by providing that:
“Where a guard assigned to the Client is absent or is incapacitated for any reason, the Company shall provide a replacement guard with minimum practicable delay.”
40. Therefore, the fact that CW 1 was not on site when DW 2 visited could not be a reason to lead to the harsh conclusion by the learned Adjudicator that security services had never been provided by the respondent at all. Under those circumstances envisaged by the said clause, there is no provision that the respondent would be considered to have breached the contract. Even then CW2 testified that another guard, George Sagaram, was on site.
41. In whole, considering the case before the SCC on the standard of reasonableness, a common man should find the evidence of CW 1 and CW 2 that the respondent had provided security services to the appellant to be more probable than that of DW 2 who was at the site for only a flitting moment, that the contract was in force. CW 1 and CW 2 were witnesses who were present on site all the time, and the evidence of Kevin, DW 2, who was only at the site for a few days, did not controvert it. For me, that evidence was not rebutted by the appellant’s witnesses nor impeached through cross-examination. Secondly, on the same standards of evaluating evidence before the SCC, I would find that the allegation by the appellant that the respondent had failed to keep proper records of vehicles and persons entering and leaving the premises was no proof that it did not have guards on site, and therefore a breach of the contract as found by the learned Adjudicator.
42. Looking at the learned Adjudicator’s judgment and the submissions of the appellant at the trial, I note that the learned Adjudicator appears to have taken word-for-word those submissions in her judgment without an independent evaluation of the evidence by both parties.
43. Failure to take into account material evidence by a trial court is an issue of law and the appellate court may interfere with the findings of the trial court where it is demonstrated that there was no evidence at all upon which the trial court’s findings were based or that the evidence relied upon was of such a nature that no reasonable tribunal, properly addressing its mind on it, could have made such findings as has been held in numerous decisions. (see for instance Bashir Haji Abdullahi v Adan Mohammed Nooru & 3 others [2014] KECA 707 (KLR). Considering the evidence tendered before the SCC, I find that the learned Adjudicator made findings that were not supported by the evidence on record, and that justifies this court’s interference with his decision.
44. Learned counsel for the appellant has strongly submitted that there was a fraudulent misrepresentation committed by the respondent in submitting the invoices for payment when no security services had been rendered. I agree with the submissions by learned counsel for the respondent in response thereto that the appellant did not raise the issue of fraud in its case against the respondent, and so the same cannot be taken up in this appeal. In any case, I have found that, based on the evidence tendered before the SCC, the learned Adjudicator’s finding that the respondent did not provide the security services was in error.
45. I am however, satisfied that, even though he made errors in his analyses of the evidence, the learned Adjudicator found correctly that the appellant was not entitled to recover the sums already paid to the respondent due to the provisions in clause 4 of the contract that all invoices would be assumed to be correct and payable should the client fail to raise any query with the company within 30 days of the date of the invoice. I believe the period of 30 days was provided for in the contract, given its nature, so that the appellant could verify whether indeed the services for which it had been invoiced had been rendered or not. Failure to raise a query meant that it was satisfied that the services had been rendered. I would add a second reason, which is what this court has found above, that in fact, security services were rendered and the appellant was obliged to pay for them.
46. From the foregoing analysis, it is apparent that the judgment of the learned Adjudicator dismissing the counterclaim is sustained but for the reasons which this court has given above. Consequently, I find the appeal has no merit, and it is dismissed, with costs to the respondent.
47. Orders accordingly.
48. Delivered, dated, and signed on the Virtual Platform, Microsoft Teams, this 30th day of April 2026.
ANDAYI W. F.
JUDGE
In the presence of:
... for the Appellant.
... for the Respondent.
Ummu: Court Assistant.