IN THE COURT OF APPEAL

AT NAIROBI

(CORAM: NAMBUYE, MAKHANDIA & M’INOTI, JJA)

CIVIL APPEAL NO. 107 OF 2010

BETWEEN

KENYA COMMERCIAL BANK LIMITED ………………................…..…..APPELLANT

AND
BENJOH AMALGAMATED LIMITED…………………………….…....………RESPONDENT

(Being an appeal from the Ruling and Order of the High Court of Kenya at
Nairobi (Lady Justice Khaminwa) delivered on 6th July, 2009
in

H.C.C.C. No. 90 of 2009)

********************

CONSOLIDATED WITH
CIVIL APPEAL NO. 137 OF 2010

KENYA COMMERCIAL BANK LIMITED ……………................……..…..APPELLANT

AND
BENJOH AMALGAMATED LIMITED…....................................1ST RESPONDENT

BIDII KENYA LIMITED................................................................2ND RESPONDENT

(Being an appeal from the Ruling and Order of the High Court of Kenya at
Nairobi (Lady Justice Khaminwa) delivered on 17th November,
2009
in

H.C.C.C. No. 494 of 2008)

********************

1
 CONSOLIDATED WITH
CIVIL APPEAL NO. 174 OF 2010

BIDII KENYA LIMITED ……………..................................................……..…..APPELLANT

AND
BENJOH AMALGAMATED LIMITED.................................…...1ST RESPONDENT
KENYA COMMERCIAL BANK LIMITED..............................2ND RESPONDENT

(Being an appeal from the Ruling and Order of the High Court of Kenya at
Nairobi (Lady Justice Khaminwa) delivered on 17th November,
2009

in

H.C.C.C. No. 494 of 2008)

********************

JUDGMENT OF THE COURT

The record of appeal before us is voluminous. It comprises eleven volumes

with each running into hundreds of pages. The record itself is a reflection of the

enormous amount of litigation that has been undertaken by the parties herein.

The dispute between the parties has had a long history in the court corridors

spanning a period in excess of 25 years, from 1992 when the first suit was filed in

the High Court. Since then, there has been at least fourteen (14) suits with all

manner of applications being made in the said suits. The dispute between the

parties has been canvassed in all the courts of record in this land, all the way to

the Supreme Court. Suffice it to say, all the suits and applications have been

geared towards resolving the dispute resulting or arising from the same

transaction and involving the same parties.

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 This judgment is in respect of 3 consolidated appeals and one cross appeal.

The appeals are Civil Appeal number 107 of 2010, Kenya Commercial Bank vs

Benjoh Amalgamated Limited. This appeal emanates from the ruling and order

of the High Court (Khaminwa, J.) dated 6th July 2009. The second appeal, Civil

Appeal No. 137 of 2010, Kenya Commercial Bank limited vs. Benjoh

Amalgamated Limited and Bidii Kenya Limited arises from a ruling by the same

Judge dated 17th November, 2009. The last appeal being Civil Appeal No. 174 of

2010, Bidii Kenya Limited v. Benjoh Amalgamated Limited and Kenya

Commercial Bank Limited, also challenges the ruling dated 17th November by the

same Judge. The cross-appeal is filed in respect of Civil Appeal No. 107 of 2010 by

Benjoh Amalgamated Limited.

The background to these appeals and cross-appeal is that sometimes in 1988,

the United States of America International Development “USAID” offered funds

by way of loans to Kenyans under the Rural Projects Enterprise Programme to be

administered by the Kenya Commercial Bank “KCB” amongst other banks. Benjoh

Amalgamated Limited “Benjoh”, wishing to start a flower export business applied

for a loan of Kshs. 18,675,000 through KCB. Following a feasibility study, KCB

recommended the project and in 1989, granted Benjoh the loan facility secured by

legal charges over two properties known as LR No. 12411/1 and LR No. 12411/2

“the suit properties”. Upon request by KCB for further security, and as a guarantee

for the loan facility, a charge was further created on a property known as LR No.

10075 owned by Muiri Coffee Estate Ltd “Muiri”.

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 As is often the case, the loanee defaulted in the repayment of the loan.

Following the default on the part of Benjoh, KCB instructed a firm of its advocates to

realize the securities charged. The advocates in turn instructed auctioneers to

advertise and sell by public auction the charged properties. A day before the

scheduled auction, Benjoh and Muiri filed HCCC No. 1219 of 1992 Benjoh and

Muiri v KCB seeking to stop the auction and claiming Kshs. 13.125 million which it

alleged it had lost in the process. The suit was however compromised by the parties

through a consent order recorded before Githinji, J. (as he then was) on 4th May,

1992 in which Benjoh admitted its indebtedness to KCB and undertook to repay the

loan by 31st July 1992. In default thereof, the consent order further allowed KCB to

proceed with the realization of the securities. Benjoh and Muiri failed to liquidate the

loan as per the consent order and KCB again sought to realize the security through a

public auction scheduled for 23 rd January 1993. A day before the said auction, Benjoh

filed HCCC No. 285 of 1993 seeking to stop the looming auction. It managed to get

an injunction which was later dismissed after inter-partes hearing. Undeterred in the

realization of its security, another auction was scheduled for 26 th June 1996 by KCB.

Two days prior to the scheduled public auction, the guarantor, Muiri filed HCCC No.

1520 of 1996 seeking general damages and contemporaneously filed an application

seeking to stop the auction of its property against KCB and Benjoh. The suit was

however dismissed. Almost a year later, Muiri filed HCCC No. 1611 of 1996 against

KCB and Benjoh but the suit was struck out as it was based on a mistaken belief that

the LR No. 10075 had

4
been sold. Another auction was slated for 7 th February 1997 but HCCC No. 24 of

1997 was filed in the High Court at Nyeri by Benjoh against KCB a day prior to the

said auction. In the suit, Benjoh prayed for a proper and detailed statement of

account and general damages. It successfully sought and obtained an injunction

stopping the said auction but the suit was ultimately struck out on 9 th May 1997

for being res judicata.

Undeterred, Benjoh went back to the original suit HCCC No. 1219 of 1992,

and filed an application seeking to set aside the consent order. The application

was allowed by the High Court but the same was overturned on appeal in Civil

Appeal No. 276 of 1997. The Court of Appeal upheld and reinstated the consent

order. Benjoh then sought consolidation of HCCC No. 1219 of 1992 with HCCC

No. 285 of 1993 but the application was dismissed since the former suit had been

finalized. A subsequent application by Benjoh to review the consent order in

HCCC No. 1219 of 1992 was also rejected by court. Still undeterred, Benjoh and

Muiri instituted HCCC No. 1576 of 1999 seeking statement of account from KCB

but the suit was dismissed by Lenaola J. (as he then was) on 23rd July, 2004 with

costs to the appellant for among other reasons being res judicata. Aggrieved, Benjoh

and Muiri filed Civil Appeal No. 239 of 2005 which appeal was also dismissed on

31st March, 2006 on account of res judicata. Four days later, Benjoh, together with

Muiri instituted HCCC No. 337 of 2006 against KCB which later became HCCC

No. 243 of 2006 upon transfer to the Commercial Division of the High Court. In

the suit, Benjoh and Muiri sought for release of title deeds to the suit properties

5
and declarations that records from KCB had failed to establish their indebtedness

to it. The court however struck out the suit on KCB’s application for being an

abuse of the process of court. Applying the doctrine of res judicata, the Judge held

that the court was not entitled to try issues which had already been determined

previously by other courts.

Subsequently, constitutional petition numbers 122 and 352 of 2007

respectively were instituted by Benjoh and Muiri against KCB but were both

dismissed for being, inter alia, res judicata on KCB’s application. The first petition

sought declaration that Benjoh’s loan account had been fraudulently operated and

further sought to compel the director of criminal investigations to institute

investigations into the said account. The second petition sought declarations that

KCB’s attempt to sell the charged properties in Nyandarua and Kiambu was in

contravention of the petitioner’s right to property under section 75 of the former

Constitution. The petitioners also prayed that KCB’s attempt to sell the charged

properties be declared illegal and unconstitutional and the said properties be

discharged and released to them.

Eventually on 19th September 2007, L.R No. 10075 was sold through a public

auction to the highest bidder, Bidii who soon thereafter became the registered owner

of the same. That notwithstanding, Benjoh and Muiri went ahead and filed HCCC

494 of 2008 against KCB and Bidii in a bid to nullify the sale. In a ruling dated 3 rd

November 2008, Lady Justice J. Khaminwa found that issues in the suit had been

previously canvassed before other courts and hence res judicata.

6
However, since the property had now been disposed off, the Judge ordered KCB to

render the final statement of accounts to Benjoh so as to bring litigation between

the parties to an end. That was not to be. Benjoh yet again instituted HCCC No.

205 of 2009 against KCB, amongst others, still questioning the advanced loan and

statement of account which had been raised in the previous suits.

Three applications filed in the High Court are the sources of these appeals.

The first appeal is in respect of an application dated 2 nd April 2009. The

application was filed by KCB against Benjoh. It was based on a suit instituted by

Benjoh and Muiri against KCB being HCCC No. 90 of 2009. In the suit, Benjoh

and Muiri, as already indicated sought a declaration that the final statement of

account rendered by the appellant pursuant to the order of Khaminwa J. was

fraudulent and a sham. They also sought a declaration that KCB breached the

contract between it and Benjoh and further prayed for special damages in the sum

of Kshs.2,243,067,494/- and general damages. When KCB became aware of the

suit, it filed a defence and simultaneously filed an application to strike out the suit.

The application was premised on the grounds that Benjoh had filed

previous suits against it and the issues in those suits were directly or substantially

in issue in the instant suit; that the suit was time barred by the Limitations of

Actions Act and that the suit had been filed without the authority of Muiri who

had previously withdrawn a suit against it. In response to KCB’s application,

Benjoh raised a preliminary objection on the ground that KCB filed its defence

7
outside the prescribed period of 7 days under the Civil Procedure Rules and

therefore sought to have the defence struck out. The Judge however refused to

strike out the defence on the basis that Benjoh had failed to demonstrate that

summons to enter appearance had been served upon KCB. Similarly, the Judge

refused the application by KCB holding that since HCCC 90 of 2009 was

pending and raised similar issues as the instant suit, the instant suit would be

stayed pending the finalization of that previous suit. Aggrieved by the said ruling,

KCB filed the instant appeal, whereas Benjoh filed the cross-appeal.

In the appeal, KCB contends that the Judge misdirected herself by failing to

appreciate the effect of the consent entered into by the parties which had finally

resolved the dispute between them. Further, that the Judge erred by failing to

appreciate that the suit was res judicata and was further statutorily barred by the

Limitation of Actions Act.

Benjoh in its cross-appeal faulted the Judge for failing to strike out the

KCB’s defence on account of it being filed out of time. Further, that the Judge

erred by failing to enter judgment as sought by it since KCB had failed to enter

appearance and file its defence as provided for under the said rules.

Civil Appeal No. 137 of 2010, as earlier alluded to, arises from HCCC No.

494 of 2008. It was instituted by Benjoh and Muiri against KCB and Bidii. It

sought to declare the sale of LR No. 10075 to Bidii illegal and void; a declaration

that Benjoh’s loan account with KCB had been fraudulently operated and an order

directing the police commissioner to investigate the account. Again when served

8
with court papers, KCB and Bidii reacted by filing similar applications to strike

out the suit on grounds that it was res judicata, scandalous, frivolous, vexatious

and otherwise an abuse of the process of the court. The two applications were

consolidated and heard together. Both applications were resisted by Benjoh. In her

ruling, Khaminwa, J. refused to strike out the suit on the ground that the

statement of accounts produced by KCB raised issues or questions that had

previously not been canvassed in court. She held that the issue of accounts raised

in the suit warranted a trial and therefore dismissed the two applications.

Aggrieved by the said ruling, KCB instituted Civil Appeal No. 137 of 2010.

In its appeal, KCB faults the Judge for failing to appreciate that the claims or

issues contained in HCCC No. 494 of 2008 were res judicata. Further, for failing to

appreciate the consent order recorded in 1992 where Benjoh admitted owing KCB

the loan amount. KCB also impugned the judgment for making conclusive findings

without the benefit of a trial. Moreover, it contended that the issues canvassed by

the Judge had been conclusively canvassed in Nairobi HCCC 1576 of 1999 and the

decision therein upheld by the Court of Appeal in Nairobi Civil Appeal No. 239 of

2004.

Bidii in turn instituted Civil Appeal No. 174 of 2010 against the same

ruling. It complained that the Judge in her determination failed to appreciate that

Muiri, as the original owner of LR No. 10075, having discontinued suit against it

and KCB on 29th September 2008, then Benjoh lacked requisite locus standi to

institute the suit. It further faulted the Judge for failing to appreciate that the

9
issues raised in the suit had previously been canvassed even before her and she had

held the same to be res judicata. There is also the ground of appeal that the Judge

had failed to appreciate the consent previously recorded and upheld by the various

courts.

The appeals, with the consent of the parties, were canvassed by way of

written submissions with limited oral highlights. In its written submissions in

support of the first two appeals and in opposition to the cross appeal, KCB

submitted that the prayers sought in Nairobi HCCC No. 90 of 2009 were similar

to the prayers that Benjoh had sought in Nairobi HCCC No. 122 of 2007 and the

matters were therefore res judicata. Further, that the Judge in her ruling rendered in

HCCC 494 of 2008 had found all the issues between the parties res judicata upon

being moved by KCB. KCB also pointed out that prior to the filing of Nairobi

HCCC No. 90 of 2009, Muiri had filed HCCC No. 505 of 2008 against it and

Khaminwa J. who also dealt with the application then granted an injunction

against it. However, KCB appealed against that decision in Nairobi Civil Appeal

No 100 of 2010 as consolidated with Nairobi Civil Appeal No 106 of 2010; KCB

Ltd v Muiri Coffee Estate Ltd & Others on the basis that the Judge had erred in

not finding that the matters raised before her were res judicata. This Court allowed

the appeal. The matter might have ended there but the promulgation of the

Constitution, 2010 introduced the Supreme Court as the apex court. Article

163(4)(b) of the Constitution conferred jurisdiction on the Supreme Court to

hear appeals in which it or this Court certified that a matter of general public

10
importance was involved subject to the power vested in the Supreme Court to

review a certificate by this Court and to either affirm, vary or overturn it.

Buoyed by the said constitutional provision, Benjoh and Muiri approached

the Court of Appeal and applied for a certificate for leave to appeal to the Supreme

Court against its decision. The issue as framed before the Court of Appeal which

required interrogation and input by the Supreme Court was “whether the High Court

and the Court of Appeal, which are Courts of record, have jurisdiction to entertain proceedings

and make Rulings and Judgments on the basis of Orders supposedly made before a Court of record,

where that record is in fact missing”.

It should be noted that the existence of the consent order entered into

between the parties had been challenged by Benjoh all through, even in the instant

appeal. Benjoh and Muiri managed to persuade the Court of Appeal that indeed

such an issue was a matter of general public importance and therefore obtained

leave to proceed to the Supreme Court. KCB challenged the grant of the leave in

the Supreme Court on the basis that the issues in the suit did not transcend the

interest of the parties so as to bear an interest on the society. The Supreme Court

ultimately ruled in favour of KCB and the leave to appeal was rescinded and the

consent previously recorded between the parties held to be valid and binding.

Further in its submissions, KCB contended that HCCC No. 90 of 2009 was

time barred in view of the fact that the contract between the parties was breached

in 1990 and the suit was filed on 11th February 2009. According to the appellant,

11
the suit was time barred by dint of section 4 (1) (a) of the Limitations of Actions

Act which required any such suit to be filed within 6 years.

On Benjoh’s cross appeal, KCB maintained that Benjoh did not serve upon it

the plaint and summons to enter appearance as required by the Civil Procedure

Rules. It termed a forgery an affidavit of service stating that the said documents

had been served upon it. That however, upon learning of the suit, it duly filed its

memorandum of appearance and defence but was unable to serve the same upon

Benjoh since the latter did not exist at the address given in the plaint and was

untraceable.

Benjoh, in its written submissions in opposition to the appeals and in

support of the cross-appeal stated that at the core of the appeals was the question

whether a customer in a bank-customer relationship was entitled to a rendition of

true and proper accounts. That upon receipt and scrutiny of the same, whether a

customer is entitled to hold the bank to account. According to Benjoh, the Judge

having perused the accounts produced by the appellant raised various queries in

the said accounts which had not been previously canvassed and the judge rightly

therefore refused to strike out HCCC No. 494 of 2008 “since it contains substantial

claim on accounts.” The respondent cited the case of Margaret Njeri Muiruri v

Bank of Baroda (2014) eKLR where it was held that a bank had an obligation to

keep and provide proper accounts. Benjoh disputed the existence of the consent

order relied on by KCB and Bidii as having settled the dispute. According to the

12
respondent, it was being condemned on a non-existent and unascertainable court

record.

Benjoh further disputed the exercise of KCB’s statutory power of sale over

LR No. 10075. It submitted that according to the consent, KCB was only at liberty

to proceed with the realization of the two charged properties and not the

property owned by Muiri. It rejected the argument by KCB that it was at liberty

to realize any of the three securities that secured the loan facility. It also rejected

the notion that in the matters before her, the Judge was enjoined to defer to the

consent and disregard the duty to render true and proper accounts. Benjoh was

also of the view that KCB was obligated to demonstrate how it complied with the

consent order by proving the outstanding sums and the co-relation with the two

charged properties.

On res judicata, Benjoh submitted that the Judge in her ruling of 3 rd

November 2008 discarded the issues she deemed res judicata and upheld those that

were not. As such, the Judge held that, the only question not canvassed was the

question of how the loan account was operated. That save for the statement of

accounts provided by KCB pursuant to the order of the Judge, nowhere in the

chequered history of the dispute had KCB been called upon to account. Benjoh

reiterated that it was entitled to be provided with the accounts and the same

required to be scrutinized to the satisfaction of the Court informed by the duty of

the bank to a customer which duty was not in question. It remained adamant that

the duty to account had not been extinguished and could not be muted by the

13
principle of res judicata. This is especially since it argued that the subject loan

account continued to be operated even after the consent and continues to attract

interest at undisclosed rates. That to hold res judicata applied to rendering of

accounts was to allow a fiduciary to hide behind the strictures of technicalities.

Benjoh denied that the suit was time barred on the basis that the subject

loan account had not been closed. According to it, the duty to render accounts can

only be extinguished by rendering true and proper accounts. To the extent that

KCB had impugned the High court’s duty to make final conclusions prior to a full

trial, Benjoh submitted that the Judge was entitled to make an informed and

reasoned ruling on the evidence before her. Further, that the findings of the

learned Judge at the interlocutory stage were informed by KCB and Bidii seeking

to terminate the suit before court without trial and the findings did not bar the

conduct of a trial. In reply that it did not have locus standi to institute the suit, it

contended that a borrower had a right to impeach the realization of a security

presented to a lender as a guarantee to its financial facility.

In prosecuting its appeal, Bidii in its written submissions reiterated and

associated itself with the arguments advanced by KCB in its written submissions.

For instance, it submitted that Benjoh lacked locus standi to institute the suit in

respect of LR No. 10075. As already observed, the property was owned by Muiri

who had earlier on discontinued suit against it and KCB. Further that the issues

raised in the suit were res judicata and the suit amounted to an abuse of the court

process.

14
 During the oral highlights, learned counsel Mr. Nyachoti and Issa

Mansour appeared for KCB and Bidii respectively and relied on their filed written

submissions. Appearing for Benjoh, learned counsel Mr. Kyalo Mbobu orally

highlighted that in her ruling of 17thNovember 2009 the Judge found as a fact that

the question of accounts had never been canvassed. That the Judge found that the

question arose in regard to the statements of accounts which had not been dealt

with in the prior cases and so on that basis, the Judge refused to strike out the suit.

In the circumstances he denied that the Judge fell afoul of the doctrine of res

judicata. According to counsel, the issue of duty of a bank to account to a

customer had never been canvassed and that was the gist of the suits before the

High Court. Further, counsel revisited the issue of the consent and submitted that

the same was nonexistent in the court records. Even so, he submitted that

according to the consent order, KCB was to realize its security from the two

principal properties charged and not Muiri’s property as it did. That by doing so,

KCB offended the terms of the consent order.

Mr. Nyachoti in reply submitted that the consent order settled the dispute.

That even if the consent order itself could not be traced in the court records, that

was immaterial since it had never been challenged as a forgery. He submitted that

the issue of the property and the accounts that the Director of Criminal

Investigations had been requested to investigate had been settled with finality by

the Supreme Court.

15
 Mr. Issa on his part associated himself fully with the submissions of Mr.

Nyachoti and further submitted in reply that Benjoh’s submissions did not

resonate with the plaints before the High Court. He pointed out that the consent

order was not challenged or mentioned in the plaints. Further, that Benjoh did not

say which property was to be sold, the charged properties or LR No. 10075. In

conclusion, counsel submitted that the attempt to reopen the issue of consent flies

in the face of the Supreme Court decision which had reaffirmed with finality that

issue.

Having considered the records of the appeals, the rulings of Khaminwa, J.,

the written and oral submissions as well as the law, it is our view that the appeals

and cross-appeal can be determined on the following grounds; res judicata, the

consent order and finally, the statutory power of sale exercised by KCB.

As previously observed, the amount of litigation undertaken by the parties

herein has been enormous and unrelenting. A plethora of suits numbering at least

14 have been canvassed in all the courts of record all geared towards resolving the

same dispute arising from a single transaction and involving the same parties. In

such a scenario, small wonder that issues previously canvassed and determined by

other courts have repeatedly found their way before other courts for

determination. Courts called upon to determine such issues have all invoked the

doctrine of res judicata. The doctrine is provided for in our jurisprudence by dint of

section 7 of the Civil Procedure Act which provides;

16
 “No court shall try any suit or issue in which the matter directly
and substantially in issue has been directly and substantially in
issue in a former suit between the same parties, or between
parties under whom they or any of them claim, litigating under
the same title, in a court competent to try such subsequent suit or
the suit in which such issue has been subsequently raised, and has
been heard and finally decided by such court.”

The elements of res judicata have been held to be conjunctive rather than

disjunctive. As such, the elements reproduced below must all be present before a

suit or an issue is deemed res judicata on account of a former suit;

(a) The suit or issue was directly and substantially in issue in the former

suit.

(b) That former suit was between the same parties or parties under

whom they or any of them claim.

(c) Those parties were litigating under the same title.

(d) The issue was heard and finally determined in the former suit.

(e) The court that formerly heard and determined the issue was

competent to try the subsequent suit or the suit in which the issue is

raised.

See Mulla, Procedure Code Act of 1908 16 th Edition.

Expounding on the rationale of the doctrine, the Court of Appeal remarked

as follows in the recent appeal; Independent Electoral & Boundaries

Commission v Maina Kiai & 5 Others (2017) eKLR,

“The rule or doctrine of res judicata serves the salutary aim of

bringing finality to litigation and affords parties closure and
17
 respite from the spectre of being vexed, haunted and hounded by
issues and suits that have already been determined by a
competent court. It is designed as a pragmatic and common-
sensical protection against wastage of time and resources in an
endless round of litigation at the behest of intrepid pleaders
hoping, by a multiplicity of suits and fora, to obtain at last,
outcomes favourable to themselves. Without it, there would be
no end to litigation, and the judicial process would be rendered a
noisome nuisance and brought to disrepute and calumny. The
foundations of res judicata thus rest in the public interest for
swift, sure and certain justice.”

See also William Koros (Legal Personal Representative of Elijah, C.A.

Koross v. Hezekiah Kiptoo Komen & 4 others (2015) eKLR.

Cognizant of the above principles, the courts called upon to decide suits or

issues previously canvassed or which ought to have been raised and canvassed in

the previous suits have not shied away from invoking the doctrine as a bar to

further suits. As was stated in Henderson v Henderson (1843) 67 ER 313, res

judicata applies not only to points upon which the court was actually required by

parties to form an opinion and pronounce a judgment, but to every point which

properly belonged to the subject of litigation, and which the parties, exercising

reasonable diligence, might have brought forward at the time. In the case of

Mburu Kinyua v Gachini Tutu (1978) KLR 69 Madan, J. Quoting with approval

Wilgram V.C. in Henderson v Henderson (supra) stated:

“Where a given matter becomes the subject of litigation in,

and of adjudication by a court of competent jurisdiction, the
court requires the parties to that litigation to bring forward their
whole case and will not (except in special circumstances) permit
the same parties to open the same subject of ligation in respect of
a matter which might have been brought forward as part of the
18
 subject in contest, but which was not brought forward, only
because they have from negligence, inadvertence, or even
accident omitted part of their case. The plea of res judicata
applies except in special cases, not only to points upon which the
court was actually required by the parties to form an opinion and
pronounce judgment but to every point which properly belonged
to the subject of litigation, and which parties exercising
reasonable diligence, might have brought forward at the time”
(emphasis added).

We have no doubt at all that the suits filed by Benjoh and Muiri raised

issues that were previously raised or could with reasonable diligence have been

raised in the previous suits. This is the basis upon which we will eventually

determine whether the judge erred in not upholding KCB and Bidii contention

that issues raised in the suit had already been raised and finally determined in the

previous suits; that the former suits involved the same parties, and that the courts

which handled those previous suits were competent.

The first case in respect of the dispute was Nairobi HCCC No. 1219 of 1992,

instituted by Benjoh and Muiri against KCB which culminated in the consent

order which the respondent still impugns before this Court. Faced with imminent

sale of the charged property by KCB in exercise of its statutory power of sale,

Benjoh and Muiri rushed to court for an injunction. In the suit both prayed that

the performance of the contract between Benjoh and KCB, without the fault on

the part of Benjoh became impossible and the said contract was frustrated, and

Benjoh ought to be discharged from the said contract and it would therefore be

unjust and unconscionable for KCB to sell the suit properties belonging to Benjoh

and Muiri. Alternatively, a declaration that by withholding the balance of the

19
monies applied for by Benjoh, KCB was thereby in breach of a condition to be

implied from the nature thereof, that it would not so withhold the monies rest

(sic) Benjoh’s consideration in the transaction fails. They also prayed for damages

of Kshs. 13,125,000/- and general damages.

Subsequently, the suit was compromised in terms that the duo would pay

the outstanding balance on the loan but were unable to live up to their promise.

Can it be said that the issue of the duty of a bank to render true and proper

accounts to a customer now being raised by Benjoh could not have been raised at

that stage and in that suit? Indeed, from the prayers above, KCB’s obligation to

account to Benjoh is indirectly raised. Benjoh and Muiri later instituted HCCC No

1576 of 1999 seeking to invalidate the consent and further sought a statement of

accounts. Called upon to decide the suit, Lenaola, J. (as he was then), dismissed the

suit and further stated as follows;

“43. Do all these issues show that the matters are res judicata?
Without hesitation, I shall say, yes. HCCC 1219/92 has been
settled in terms of the consent order and the issues pleaded there
cannot now be the basis for a fresh plea seeking similar remedies.
Litigation must come to an end, however painfully!”

Again the issue of accounts and the duty of the bank to render accounts to

the customer was in focus and or could have been raised in this suit. Indeed, it was

partially raised. Aggrieved by that decision, the parties moved to this Court in

Civil appeal No. 239 of 2004 and the Court upheld the findings of the learned

Judge and stated;

20
 “Having held that all the issues raised in H.C.C.C. No. 1576 of 1999
were res judicata we do not think it is necessary for us to
consider whether that suit was an abuse of the process of the
court and whether it was filed outside the period of limitation. In
any case a party who brings for the decision of the court matters
which have already been determined can truly be said to be
abusing the process of that court. And whether the suit was
brought within or outside the limitation cannot really matter; the
issues raised in it having been previously determined, no court
was entitled to try those issues again.

We have said enough, we think, to show that this appeal cannot

succeed. We think the Appellants will not like it but we also
must point out to them that irrespective of how many cases they
may wish to bring on the same issues, the answer will and can
only be one and they already know what the answer shall be. This
appeal fails and we order that it be and is hereby dismissed with
costs thereof to the Respondent.”

HCCC 122 of 2007 was a constitutional petition instituted by Benjoh and

Muiri against KCB. It was also dismissed on account of being res judicata. In the

said petition, Benjoh had sought a declaration that the loan account had been

fraudulently operated and that the Director of Criminal Investigations be called

upon to investigate the account. Once again the issue of accounts and the

bank/customer relationship was a live issue and even if it was not, with exercise of

diligence, Benjoh could have raised it. Prior to this, there was also HCCC No. 24

of 1997 in which Benjoh sought from KCB the rendering of proper accounts. There

was also HCCC No. 243 of 2006 in which Benjoh claimed that records from KCB

had failed to establish their indebtedness. Are all these not matters of accounts?

Following the sale of LR No. 10075 to Bidii on 19th September 2007 via a

public auction, Benjoh and Muiru sought to restrain the new owners from taking
21
possession. The same Judge (Khaminwa, J) however in a ruling dated 3rd

November held all the issues raised to be res judicata. This is how the judge
rendered herself;

“I have perused all the authorities on this submission

and I have come to the conclusion that the matters already
determined in this dispute havebecome res judicata in view of
the previous suits and the ruling of justice Warsame in Suit
No. 11 of 2007 aforesaid decided. All matters relating to the
exercise of the power of sale by first defendant are now res
judicata

...regarding the issue of accounts this issue has herein

been raised before. However the applicant is entitled to final
account. In view of the final sale and transfer of the
mortgaged property, this should bring this litigation to a
close.”

By then, Muiri who was the 2nd plaintiff in the suit and the initial owner of

LR No. 10075 and guarantor to the Benjoh had discontinued the suit on 29 th

September 2008 against both KCB and Bidii which has led to the argument that

Benjoh therefore lacks locus standi. Upon Benjoh being furnished with the accounts

as ordered, it again instituted HCCC No. 90 of 2009 seeking declarations that the

statement of accounts rendered by KCB was fraudulent and a sham, that KCB

breached the contract between it and Benjoh to advance Kshs. 23,175,00/- for a

floriculture project, special damages of Kshs. 2,243,067,494/- as well as general

damages. KCB in turn sought to strike out the suit on account of being res judicata.

The application culminated in the ruling dated 6 th July 2009 which stayed HCCC

NO. 90 of 2009 till HCCC No. 494 of 2008 was heard and finalized. Again, the

question of accounts and KCB’s duty to Benjoh is readily

22
discernable. That ruling triggered Civil Appeal No. 107 of 2010, wherein the

ruling is impugned on grounds that the Judge erred in not appreciating that the

issues in the dispute were res judicata on account of former suits and the consent

decree. Benjoh on its part filed a cross-appeal alleging that the Judge erred in

failing to strike out the respondent’s defence to the suit as the same was not filed

in compliance with the Civil Procedure Rules. Raising similar issue, the appeals

were consolidated for determination.

In its submissions, Benjoh has contended that the matter of accounts raised

in the two suits was not res judicata and as such required to proceed to trial. KCB

on the other hand insists that the matter is res judicata. KCB for instance points out

that in HCCC No. 122 of 2007, Benjoh sought a declaration that the loan account

had been fraudulently operated. In HCCC No. 90 of 2009, Benjoh again sought to

declare the statements of accounts furnished as a sham and fraudulent. The earlier

suit was dismissed by Warsame, J. (as he then was) on account of being res judicata.

The learned Judge remarked as follows;

“No matter the number of suits, no matter the distance travelled,

no matter who files the case, no matter the sophistication and
ingenuity of the advocate acting for the Plaintiff, no matter which
Judge attempts to determine the plaintiff’s dispute with the bank,
the inevitable and only answer to the plaintiff’s repeated
question to our judicial system is and can only be one. They know
it. And there is no need for me to repeat.

I therefore think there is no reason to cling to a property given as

a security to the bank for funds received from the bank. The
rights of the Plaintiffs in that security are not absolute and it is
unwise and unnecessary to come and knocking a door whose
keys is in your possession. The point I am making, is that even if
Lord
23
 Denning was to be recalled from his grave and given the task to
decide the Plaintiff’s case with the same facts presented before
the various courts, he would, I think reach and/or arrive at the
same decision as that of the High Court and the Court of Appeal
judges who attended to the Plaintiffs’ various matters.”

In its quest to escape liability or mitigate loss, Benjoh has pursued almost

all possible legal avenues and has employed tremendous legal ingenuity and

sophistry. Benjoh however seems to have ignored or failed to grasp the full tenor,

extend and spirit of the doctrine of res judicata. The doctrine is grounded on public

interest and thus transcends the parties’ interests in a suit. Public interest requires

or demands that litigation must at some point come to an end. In the Maina Kiai

case (supra), the Court quoted with approval the Indian Supreme Court in the

case of Lal Chand v Radha Kishan, AIR 1977 SC 789 where it was stated;

“The principle of res judicata is conceived in the larger public

interest which requires that all litigation must, sooner than later,
come to an end. The principle is also founded in equity, justice
and good conscience which require that a party which has once
succeeded on an issue should not be permitted to be harassed by
a multiplicity of proceedings involving determination of the same
issue.

The practical effect of the res judicata doctrine is that it is a

complete estoppel against any suit that runs afoul of it, and there
is no way of going around it – not even by consent of the parties –
because it is the court itself that is debarred by a jurisdictional
injunct, from entertaining such suit.”

Again, in Benjoh Amalgamated Limited & Another v Kenya Commercial

Bank Limited [2014] eKLR, this Court in determining yet another application by

Benjoh stated thus,

24
 “In Management Corporation Stratta Title Plan No.301 v. Lee Tat
Development Pte Ltd[2009] S GHC 234, the Court of Appeal (of
Singapore) examined the doctrine of res judicata in relation to
decided cases and observed that the policy reasons underlying
the doctrine of res judicata as a substantive principle of law are
first “the interest of the community in the termination of
disputes, and in the finality and conclusiveness of judicial
decisions” and second, “the rights of the individual to be
protected from vexatious multiplication of suits and
prosecutions.”

The Court went on to state that:

“the courts have never accepted res judicata as an absolute

principle of law which applies rigidly in all circumstances
irrespective of the injustice of the case. There is one established
exception to this doctrine, and that is where the Court itself has
made such an egregious mistake that grave injustice to one or
more of the parties concerned would result if the Court’s
erroneous decision were to form the basis of an estoppel against
the aggrieved party.... In such a case, the tension between justice

principle and the finality principle is resolved in favour of the

former.”

“... the general rule is that where a litigant seeks to reopen in a

fresh action an issue which was previously raised and decided
on the merits in an earlier action between the same parties, the
public interest in the finality of litigation (“the finality
principle”) outweighs the public interest in achieving justice
between the parties (“the justice principle”) and therefore the
doctrine of res judicata applies. In such cases, it is usually
immaterial that the decision which gives rise to the estoppel is
wrong because “a competent tribunal has jurisdiction to decide
wrongly, as well as correctly, and if it makes a mistake its
decision is binding unless corrected on appeal.”

Therefore, there are instances where the public interest is given prominence

over parties’ interests in a suit. Such an instance, in our view, would be like in the
instant suit where great burden of litigation has been placed upon a party

necessitating such a party to seek protection from court. The Supreme Court of
25
India in the case of State of UP v Nawab Hussain, AIR 1977 SC 1680, considered

the doctrine of constructive res judicata and delivered itself thus,

“This doctrine is based on two theories: (i) the finality and

conclusiveness of judicial decisions for the final termination of
disputes in the general interest of the community as a matter of
public policy, and (ii) the interest of the individual that he should
be protected from multiplication of litigation. It therefore serves
not only a public but also a private purpose by obstructing the
reopening of matters which have once been adjudicated upon.”

Further that,

But it may be that the same set of facts may give rise to two or
more causes of action. If in such a case a person is allowed to
choose and sue upon one cause of action at one time and to
reserve the other for subsequent litigation, that would aggravate
the burden of litigation. Courts have therefore treated such a
course of action as an abuse of its process and it would be
accurate to say that res judicata for this purpose is not confined
to the issues which the court is actually asked to decide, but that
it covers issues or facts which are so clearly part of the subject
matter of the litigation and so clearly could; have been raised that
it would be an abuse of the process of the court to allow a new
proceeding to be started in respect of them. This is therefore
another and an equally necessary and efficacious aspect of the
same principle, for it helps in raising the bar of res judicata, by
suitably construing the general principle of subduing a
cantankerous litigant. That is why this other rule has sometimes
been referred to as constructive res judicata which, in reality, is
an aspect or amplification of the general principle.”

To our mind, there is no better case in which the Court ought to invoke the

doctrine of constructive res judicata than in the present appeals. Constructive res

judicata is broader and encompasses all the issues in a dispute which, a party

employing due diligence ought to have raised for consideration. To allow Benjoh
26
to relitigate, re-agitate and re-canvass any issues, no matter how crafted or the

legal ingenuity and sophistry employed and in spite of the plethora of cases

already conclusively determined by competent courts on the question of accounts,

would be tantamount to throwing mud on the doctrine of res judicata and allow a

travesty of justice to be committed to a party. The specific issue the respondent

raises of rendering true and proper accounts to a customer’s accounts, has been or

could have been raised before the High Court in the previous suits.

The history of this matter shows a vexatious litigant who in spite of having

lost all the fourteen cases and despite the costs involved is still willing to further

subject KCB and Bidii to ceaseless litigation. Justice demands that a successful

party in litigation be allowed to enjoy the fruits of its litigation. It is time the

respondent accepted the inevitable despite the consequences such a possibility

portends to it and stops further litigation on this long running dispute which has

all been about KCB’s exercise of its statutory power of sale and accounts. To open

up any further litigation would complicate matters as they stand and goes against

the pursuit of finality in this dispute.

Probably recognizing the tenacity of the human spirit in pursuit of a goal,

the Supreme Court of India in the Nawab Hussein case (supra) stated that the

spirit of contentiousness may give rise to conflicting judgments of equal authority,

lead to multiplicity of actions and bring the administration of justice into

disrepute. To guard against such and in ensuring certainty of the law, this Court

ought to and does affirm what the various courts have stated, that the issues in

27
this dispute are for as long as they revolve around KCB’s exercise of statutory

power of sale and accounts are res judicata and Benjoh ought to accept that fact.

Accordingly, the learned Judge erred in not allowing the applications by KCB and

Bidii to strike out the suit on that account.

Benjoh too has contested the consent order entered into between the

parties on the ground that the consent order was nonexistent and was not

available in the court records. That contention by the respondent before this

Court shows Benjoh’s propensity in disregarding the doctrine of res judicata. In no

other issue in this matter, in our view, does the doctrine of res judicata apply more

than the issue of the consent order recorded before Githinji J. The consent has

been affirmed by all the courts of record. In HCCC 1576 of 1999, the High Court in

its judgment held that,

“For the avoidance of doubt, the consent order of 4.5.1992 in

HCCC 1219/92 remains the decision of the court in the dispute
between parties and I so affirm.”

The Court of Appeal in Civil Appeal No. 239 of 2004; Benjoh

Amalgamated & Another v KCB dealt with the issue of consent order as follows,

“All those suits ended or were terminated in favour of the

Respondent but on 4th April, 1997, some five years after the
original suit was filed and the consent judgment entered the two
Appellants went back to Civil Case No. 1219 of 1992 and under
Order 44 Rule 1 asked Githinji, J (as he then was) who had
recorded the consent judgment to review or set aside the consent
judgment. The reasons for that application are not really relevant.
What is relevant is that Githinji, J heard the application, and by
his order dated 31st October, 1997 allowed the same and set aside
the consent judgment. The present Respondent was aggrieved by
the order of Githinji, J and

28
 appealed to this Court vide Civil Appeal No. 276 of 1997. By its
judgment dated and delivered on 10thMarch, 1998 the Court
allowed the appeal, set aside the orders which Githinji, J had
made and restored the consent judgment which had been entered
on 4th May, 1992. One would have thought that would be the end
of the matter but not so the Appellants.”

Indeed, Benjoh went ahead and managed to convince the Court of Appeal

that the issue of missing court record was a matter of general public importance

that necessitated the input of the Supreme Court. As stated elsewhere in this

judgment, the Court of Appeal did grant leave to Benjoh to appeal to the Supreme

Court which basically was a challenge to the consent order entered into between

the parties. KCB successfully challenged the grant of the leave in the Supreme

Court. In its ruling rescinding the leave, the apex court pronounced itself in

Kenya Commercial Bank Limited v Muiri Coffee Estate Limited & another

[2016] eKLR as follows,

“A Court’s Judgment and/or Ruling, in the perception of the

Constitution and the law, is an edict that resolves a live issue of
controversy, and is by no means an abstract pronouncement. In
asking this Court to pronounce itself on the propriety of a missing
record of the High Court, the Court is being called upon, in the
very first place, to determine the question of the legality of the
consent made by the parties herein in that missing record. That
question was settled as far back in time as 1998. It is not
conceivable that this Court should reopen that consent. Since
that question was first determined with finality on 10th March,
1998, rights, obligations and interests have crystallized, and they
carry all validity, and embody proper and legitimate expectations.
The system of justice that is upheld by the Court of law, will not
tamper with such rights and obligations, even where some parties
may feel aggrieved.”
29
 This Court is bound by those findings. This Court too cannot depart from

the findings of fact previously reached by the trial courts as they were based on

evidence. We think we have said enough to demonstrate that the question or the

fate of the consent order has been settled by the highest court in the land and is

therefore not amenable to challenge by Benjoh.

In its submissions, Benjoh has also raised an issue which in the strict

interpretation of the law and in an adversarial system should not fall for

consideration in this appeal. As already stated, the said issue is outside the

purview of the suits from which the current appeals emanate, being HCCC No.

494 of 2008 and HCCC No. 90 of 2009. The issue we are talking about is KCB’s

exercise of statutory power of sale. The substantive prayer in HCCC No. 494 of

2008 was a declaration that the account had been fraudulently operated. In the

latter suit, the respondent sought a declaration that the statements of account

were fraudulent and a sham. In his oral submissions learned counsel Mr. Issa

Mansour pointed out that the submissions of Benjoh failed to resonate with the

suits as filed in the High Court. In its submissions, Benjoh still challenges the

appellant’s statutory power of sale over LR No. 10075 and faults KCB for having

exercised its power of sale over the property owned by Muiri instead of the two

principally charged properties. Benjoh submits that in doing so, KCB ran afoul of

the consent order. These are issues that were not raised in the suits from which

these appeals emanate.

30
 During the oral hearing, Mr. Issa submitted that Benjoh had not contended

which property KCB ought to have sold, other than LR No. 10075. On the other

hand, it was KCB’s contention that it was at liberty to realize its security from any

of the properties it held as security. It should also be remembered that the charge

over the sold property was created after KCB requested or demanded further

security for the loan facility. LR No. 10075 was thereafter charged upon that

demand and therefore was given as a security for the loan. Benjoh cannot therefore

argue that KCB exercised its right of sale over the wrong property. The said

property had been charged to secure the loan and was sold upon default. In our

view it was within KCB’s right to choose upon which property to exercise its

rights over.

Benjoh’s cross appeal is anchored on the application that sought to strike

out KCB’s defence on the ground that the same was filed outside the timelines

stipulated under Order VIII rule 1 (2) and Order VI rule 13 (1) (d) of the Civil

Procedure Rules. KCB denied service of the suit papers or the summons upon it.

Upon interrogation of that allegation by the Judge, she rightly found that Benjoh

failed to demonstrate that it had served the summons and the suit papers upon

KCB, and therefore, it could not successfully invoke the above provision of the

Civil Procedure Rules. This is a finding of fact and no basis has been laid to

warrant our intervention. The upshot is that the cross appeal is a non-starter and

ought to be dismissed.

31
 On the whole, Civil Appeals Nos. 107, 137 and 174 all of 2010 are allowed

with costs. The cross-appeal is however dismissed with costs as well.

Dated and delivered at Nairobi this 15th day of December, 2017.

R. N. NAMBUYE

……………………..…………….
JUDGE OF APPEAL

ASIKE-MAKHANDIA

……………………..…………….
JUDGE OF APPEAL

K. M’INOTI

……………………..…………….
JUDGE OF APPEAL
I certify that this is
a true copy of the original.

DEPUTY REGISTRAR

32