Automated Summary
Key Facts
The High Court of Kenya dismissed Meditec Systems Limited's application to strike out Afromcare Limited's defense and counterclaim. The plaintiff argued the defense lacked merit and evidence, while the defendant claimed the application violated their constitutional right to a fair hearing. The court found the counterclaim raised bona fide triable issues regarding the plaintiff's alleged breach of contract, including machinery defects causing operational losses and costly repairs. Costs of the application were awarded to the defendant.
Transaction Type
Breach of contract related to machinery performance and financial losses
Issues
The court must determine whether the Defendant's Defence and Counterclaim, which include allegations of breach of contract and failure to perform under the agreement, should be struck out, thereby concluding the case without a full trial and denying the Defendant the opportunity to present its case.
Holdings
The Plaintiff/Applicant's application by way of a Notice of Motion dated 13th June 2024 seeking to strike out the Defence and Counterclaim was dismissed. The Court determined that the Defence and Counterclaim raised bona fide triable issues, particularly regarding the Plaintiff's alleged breach of contract, failure of performance, and economic loss, which require proof through a trial. The costs of the application were awarded to the Defendant/Respondent.
Remedies
- The Plaintiff/Applicant's Notice of Motion dated 13th June 2024 seeking to strike out the Defence and Counterclaim is hereby dismissed.
- The costs of the application are awarded to the Defendant/Respondent, as the Court found the application to be premature and the Defence to raise triable issues.
Legal Principles
- The Court held that striking out the Defence and Counterclaim at this stage would violate principles of natural justice, specifically the constitutional right to a fair hearing under Article 50 of the Kenyan Constitution. The Applicant's motion was deemed premature as it sought to deny the Defendant an opportunity to present its case, which is a fundamental right in judicial proceedings.
- The Court applied the legal standard under Order 2 Rule 15 of the Civil Procedure Rules, which permits striking out pleadings only in exceptional circumstances where they are a 'complete sham'. The Defence and Counterclaim were found to raise genuine triable issues (e.g., breach of contract, failure of performance, and economic loss) that require expert evaluation and full evidence, not summary determination.
Precedent Name
- Olympic Escort International Co. Ltd. & 2 Others vs. Parminder Singh Sandhu & Another
- Blue Shield Insurance Company Ltd vs. Joseph Mboya Oguttu
Key Disputed Contract Clauses
- The Defendant alleged that the Plaintiff breached the contract by supplying machinery that was unfit for its intended purpose, caused operational losses due to excessive downtime, and required costly repairs exceeding the purchase price.
- The Defendant disputes the sum claimed by the Plaintiff as liquidated damages, arguing that the Plaintiff failed to meet its contractual obligations and that the losses were not properly established.
Cited Statute
Civil Procedure Rules
Judge Name
Njoroge Benjamin K.
Passage Text
- "It is trite that, a triable issue is not necessarily one that the defendant would ultimately succeed on. It need only be bona fide." (paragraph 6.10)
- "In light of the above the Court declines to strike out the Defence and Counterclaim." (paragraph 6.13)
- "The principles guiding the Court when considering such an application which seeks striking out of a pleading is now well settled. Madan J.A. (as he then was) in his judgment in the case of D.T. Dobie and Company (Kenya) Ltd vs Muchina (1982) KLR 1 discussed the issue at length..." (paragraph 6.5)
Damages / Relief Type
- Liquidated damages as claimed by the Plaintiff in the original suit.
- Compensatory damages sought by the Defendant in the Counterclaim for breach of contract and financial losses.