Riley Falcon Security Services Limited v Maseno University & another [2017] eKLR

Key Facts

Transaction Type

Issues

• Whether the University breached the Agreement by evicting the plaintiff without 3 months' notice and if the plaintiff is entitled to 3 months' fees in lieu of notice.
• Whether the University disobeyed the order issued by Justice Dulu on 23rd May 2014 before entering into the agreement with Bedrock and the effect of such disobedience.
• Whether the defendants acted unlawfully and maliciously in evicting the plaintiff and its employees, and what relief should be awarded.
• Whether the contract between the University and Bedrock was in breach of Section 100 of the Public Procurement and Disposal Act, 2005, rendering it null and void.
• Whether the plaintiff is entitled to Kshs 10,538,695.09 for services rendered prior to termination and eviction.

Holdings

• The plaintiff's claim for Kshs 10,538,695.09 in unpaid invoices was dismissed due to failure to prove the amount due. The court noted discrepancies in invoicing and insufficient evidence of the disputed balance (Kshs 2,962,198.15), emphasizing the plaintiff's burden to demonstrate damages.
• The court dismissed the plaintiff's claim for damages arising from the eviction, finding no sufficient evidence of malicious intent or special damages. The eviction occurred at the end of the contract term, and any assault claims would require separate litigation by the affected employee.
• The court determined that the University did not breach the 23rd May 2014 injunction order (from HCCA No. 54 of 2014) by entering the Bedrock contract on 19th May 2014. The order was issued after the Board's decision to proceed with Bedrock, and the plaintiff, not being a party to that case, could not enforce it.
• The court ruled that the plaintiff could not invoke section 100(3) of the Public Procurement Act to invalidate the University-Bedrock contract. The plaintiff was not a party aggrieved by the Board's decision, and the contract was executed lawfully after the Board's dismissal of Gillys' challenge and within the 14-day appeal period.
• The court held that the extension of the Agreement by Maseno University was for a fixed term (1st May 2014 to 31st May 2014) and explicitly excluded the notice period for termination. The contractual terms beyond the extension period were not preserved, and the Agreement expired on 31st May 2014 without requiring further notice.

Remedies

• The court ordered the plaintiff to pay half the costs of the 1st defendant and full costs of the 2nd defendant, noting that part of the claim had been settled.
• The plaintiff's claim against both defendants is dismissed as all issues were answered in the negative.

Legal Principles

• The plaintiff relied on an interim injunction (HCCA No. 54 of 2014) to argue the University breached the court order by entering a contract with Bedrock. The court held the plaintiff, not a party to the injunction, could not enforce it, distinguishing between Gillys' rights and the plaintiff's claims.
• The court emphasized the plaintiff's obligation to prove the outstanding amount on the balance of probabilities. The plaintiff's claim for Kshs 2,962,198.15 was dismissed due to inability to substantiate the disputed invoices and temporary work orders.
• The plaintiff argued the University was estopped from denying payment for services rendered, including temporary work orders, based on prior conduct and agreements. The court rejected this, finding insufficient evidence to establish estoppel as the plaintiff failed to prove the University's acceptance or reliance on their actions.

Precedent Name

• Africa Management Communication International Limited v Joseph Mathenge Mugo & Another
• Martin Nyaga Wambora & 4 Others v Speaker of the Senate & 6 Others
• Republic v Public Procurement Administrative Review Board & 2 Others ex-parte Noble Gases International Limited

Key Disputed Contract Clauses

• The contractual provision regarding termination by notice or payment in lieu of notice was central to Issue No. 1. The court interpreted whether the one-month extension preserved or excluded these terms.
• Clause 7.2 allowed the University to request additional services via temporary work orders, valid for 30 days. Only four of the plaintiff's work orders were signed as required, forming a basis for payment disputes.
• Clause 7.1 established the fixed monthly payment of Kshs 3,734,040.00 for 222 guards (including supervisors and dog handlers), inclusive of VAT. Disputes arose over invoicing amounts exceeding this rate.

Cited Statute

Judge Name

Passage Text

• For the reasons I have stated above, I answer issues all the issues framed in the negative. It follows that the plaintiff's claim against both defendants is dismissed.
• I cannot therefore say that the University violated the order of Dulu J., restraining it from entering the contract with Bedrock.
• the Agreement had already expired on 31st March 2014 and the extension of the Agreement was for one month only from 1st May 2014 to 31st May 2014. This extension was for a fixed term excluded the application of a notice period longer than the fixed term.

Damages / Relief Type

• Compensatory Damages of Kshs 10,538,695.09 for outstanding services
• Declaratory Relief for the contract to be null and void
• Compensatory Damages of Kshs 11,954,979.75 in lieu of 3 months' notice
• Pecuniary, general, aggravated, and exemplary damages for breach of contract
• Costs of the suit