Mutyaene v KCB Bank Ltd & another (Petition 412 of 2020)  KEHC 2205 (KLR) (Constitutional and Human Rights) (17 March 2023) (Judgment)
Neutral citation:  KEHC 2205 (KLR)
Republic of Kenya
Petition 412 of 2020
M Thande, J
March 17, 2023
Reuben Kioko Mutyaene
KCB Bank Ltd
The Central Bank Of Kenya
1.The Petitioner filed a Petition dated 10.12.2020 seeking the following reliefs:
2.The Petitioner banks with the 1st Respondent (the Bank). The genesis of this Petition as set out in the Petition is cheque no. 000673 issued by the Petitioner for Kshs. 300,000/= payable to his supplier, Alpha Grain Millers Limited. At the time, his bank account had a credit balance of Kshs. 533,341.05. Upon depositing the said cheque in bank account no. 1136600868 at the Bank’s Flamingo branch in Nakuru on 11.12.2020, the same was unpaid and bank charges of Kshs. 600/= and 3,000/= were levied. He also paid the supplier Kshs. 2,500/=, being penalty charges levied for the unpaid cheque. On inquiry, the Bank informed the Petitioner that the cheque was unpaid due to insufficient funds in his bank account. The Petitioner then wrote to the Bank, demanding an explanation why the cheque was unpaid, refund of the unpaid cheque charges amounting to Kshs. 3,600/= and the penalty charges of Kshs. 2,500/= paid to the supplier; and to totally expunge/ delete the offending words in his bank statement viz:i.“INHouse CHQ000673 AT-DPC Unpaid 673 FT193456NWYK BANK FT19; Value Date 11DEC 2019; AMOUNT KSHS. 300,000.00”;ii.“Unpaid Item charge AT-DPC AC-PL52036 FT19345D59; Value Date 11DEC2019; AMOUNT KSHS. 600.00”;iii.“Unpaid item cha AT-DPC Unpay chrg CHQ-673 FT193; Value ate 11 DEC 2019; AMOUNT KSHS. 3,000.00”.
3.On 31.12.19, the Bank admitted the error and advised that the unpaid cheque charges amounting to Kshs. 3,600/= had been reversed and the penalty charges of Kshs. 2,500/= refunded. The Bank however stated that it could not expunge the words appearing in the Bank statement account stating “the entries appearing in the account statement are usually permeant and no interference is permitted”.
4.It is the Petitioner’s case that the incident severed the business relationship between him and the supplier. Despite refunding the penalty charges and his apology vide a letter dated 14.12.19, the supplier never made any other supplies to the Petitioner nor did it respond to the letter. The Petitioner is thus aggrieved by the Bank’s action of dishonouring the cheque in question and further by its refusal to expunge/delete/amend the offending words. Further that its explanation is wanting and in contravention of his right to good reputation, dignity, correction/deletion of untrue or misleading information and protection of his economic interest and consumer rights under Articles 28, 33, 35, 43, 46 and 47 of the Constitution. He is further claimed that the same amounts to negligence, breach of statutory duty of care and bank customer contract and that the Bank is in contravention of the Defamation Act, the Banking Act and CBK Prudential Guidelines.
5.The Petitioner accused the Bank of mishandling his account. He stated that on 5.12.19, his cheque for Kshs. 88,000/= was posted as Kshs. 8,800/=. Instead of deleting or reversing and posting the correct amount, the error was corrected by posting an additional amount of Kshs. 79,200/= without prior notice or advise to the Petitioner. The Bank has also persistently failed to pay cheques issued by the Petitioner even where his account has been adequately funded. Cheque no. 000646 for Kshs. 80,350/= was unpaid on 4.4.16 and the Bank admitted the error. Cheque no. 000655 for Kshs. 900,000/- was dishonored on 6.1.18 with the remark “crossing stamp cancelled”. The Bank corrected the position by honouring the cheque 4 days later. This prompted him to file Nakuru CMCC No. 107 of 2018 (previously Nakuru HCCC No. 34 of 2017) against the Bank. The matter is pending appeal at the Court of Appeal.
6.The Petitioner claims that the offending words in his bank statement on 11.12.19 are defamatory, malicious, injurious to his dignity, integrity, and image and reputation and has caused him to be shunned by banks and business partners and associates. On account of the Bank’s inaction, the Petitioner’s mortgage application at HFC Ltd for Kshs. 10,000,000/= on 19.2.2020, was declined as was his application for building construction services on his land parcel No. MASII/MITHINI/774 by Kyamu Construction and engineering Limited costing Kshs. 6,000,000/- on 7.10.2020. As a result, the proposed building on his land stalled, occasioning him a loss of Kshs. 800,000/= per month which he would be earning, as per a prospective tenant’s letter dated 10.9.19. The Petitioner claims that as a result of the Bank’s actions, his rights under articles 28, 29, 33, 35(1) (b) and (2), 40(1) and (2), 43, 46(1), 47 and 50 of the Constitution have been violated and he has consequently suffered pecuniary loss and damages.
7.According to the Petitioner, in order to be effective, promote efficiency, foster confidence in the banks cheque payment system and to bolster customer care, it would be prudent for the CBK to formulate and issue pursuant to Section 33 of the Banking Act, guiding policy and standard procedure for all banks for deleting, expunging and amending erroneously posted entries in bank customer accounts, statements and database in conformity to Articles 10, 19, 20, 21, 28, 29(d), (f), 33(3), 35(2), 43, 46 and 47 of the Constitution.
8.The Bank has opposed the Petition by a replying affidavit sworn on 28.1.21 by Bonnie Okumu, its Director, Legal Services. He deposed that there was an appeal pending before the Court of Appeal addressing the same issued raised in this Petition and concerning the same subject matter in Nakuru HCCA No. 163 of 2019. The Petitioner has therefore approached this Court in a manner that is irregular and improper and amounts to asking this Court to sit on the appeal through back door. The Petition is thus an abuse of the court process.
9.It is the Bank’s case that the Petition fails to meet the threshold for a constitutional petition. It provides little or no particulars as to the allegations and the manner of alleged infringement on the Petitioner’s constitutional rights. The Petition also failed to define the dispute to be determined by this Court or state with particularity, the specific right allegedly breached and how it was violated. Further that the averments do not raise any constitutional issues that can clearly guide this Court as to the alleged infringement of the Petitioner’s constitutional rights. The alleged infringements as pleaded raise issues in civil law, in particular banking and contract law and are matters that can comfortably be handled by the civil court and that this Court has unfettered discretion to transfer the matter to the civil court.
10.Additionally, it was averred that failure of the Petitioner to file an affidavit in support of the Petition meant that the same is not backed by any evidence and that the claims made in the Petition are mere allegations. Further, the documents intended to be relied upon by the Petitioner should have been presented as annexures to the affidavit and since there is none, the documents should be expunged. The Bank urged the Court to find that the Petition is fatally defective and strike it out with costs.
11.In addition to the replying affidavit, the Bank filed a notice of preliminary objection dated 30.8.21 in opposition to the Petition. The objection is that the Petition falls short of the doctrine of res judicata under Section 7 of the Civil Procedure Act as a suit with the exact same subject matter has already been dealt with and concluded by the High Court sitting in Nakuru.
12.The 2nd Respondent (CBK) opposed the Petition vide a replying affidavit sworn on 12.10.21 by Kennedy Kaunda Abuga, the General Counsel. He set out the functions of CBK which include regulation of the banking industry with a view to fostering a proper functioning and stable market based financial system. To this end, CBK does routine inspections of banks has a robust mechanism for monitoring complaints by customers and their resolution under Part IV and X of its Prudential Guidelines on reporting requirements. Where it is found that complaints handling and customer recourse procedures adopted by any bank are inadequate, CBK as regulator steps in and directs such bank to strengthen its procedures to address customer complaints.
13.On its part, CBK asserted that the Petitioner has not met the test for a constitutional petition which requires that he sets out with a reasonable degree of precision, that of which he complains, the provisions infringed and the manner of infringement. The Petition is founded on generalized complaints without any focus on the fact, law or constitution. The Petitioner has not suffered any loss and has not provided particulars or evidence of the alleged loss and cannot therefore claim compensation for any loss whether as general or exemplary damages, or at all, for non-existent or unproved loss. Additionally, the Petitioner has failed to prove the nature of his rights or fundamental freedoms which the CBK has violated or threatened. CBK thus urged that the Petition be struck out in its entirety.
14.I have given due consideration to the parties’ written submissions. The issues that arise for determination are:i.Whether the Petition is defective for want of an affidavit.ii.Whether the petition offends the doctrine of res judicata.iii.Whether the petition offends the doctrine of constitutional avoidance.iv.Whether the petition has met the threshold for a constitutional petition.v.Who is entitled to costs.
Whether the Petition is defective for want of an affidavit
15.It is the Bank’s case that the Petition is defective for want of a supporting affidavit. The Bank contended that the documents intended to be relied upon by the Petitioner should have been presented as annexures to the affidavit and since there is none, the documents should be expunged. The Bank urged the Court to find that the Petition is fatally defective and strike it out with costs.
16.Rule 4(1) of the Constitution of Kenya (Protection of Rights and Fundamental Freedoms) Practice and Procedure Rules, 2013, provides:
17.Rule 10(1) provides that an application under Rule 4 shall be by way of a petition while Rule 11 makes provision for documents to be annexed to an affidavit or petition and stipulates as follows:
18.Flowing from the above provisions, it is clear that the filing of an affidavit is optional and that a party wishing to rely on any documents may choose to annex the same to the petition or supporting affidavit. Accordingly, the contention by the Bank that the Petition is defective for want of an affidavit, is without merit.
Whether the Petition offends the doctrine of res judicata
19.The Bank submitted that the matter falls right under the doctrine of res judicata. The Bank asserted that the Petitioner had filed Nakuru CMCC No. 107 of 2018 which was heard and concluded. He appealed the decision in Nakuru No. 163 of 2019 which was dismissed and has now proceeded to the Court of Appeal. It is the Bank’s contention that the previous suit raises the same issues in the Petition herein. The bank account in question is the same in both suits, namely account no. 1109141807 held at the Bank’s Moi Avenue branch in Nairobi. In both matters, the Petitioner claims that the Bank failed to pay cheques as per his instructions and that he incurred losses. The particulars of facts in both cases are very similar including the wording. The Petitioner thus ought to have raised the issues herein in the Nakuru suit. The Bank therefore submitted that the matter meets the requirements of res judicata outlined by the Court of Appeal in the case of Independent Electoral & Boundaries Commission v Maina Kiai & 5 Others  eKLR.
20.CBK supported the Bank’s preliminary objection and submitted that the issues raised in this Petition are similar to those in the Nakuru cases.
21.On his part, the Petitioner submitted that the issues raised in the Petition have to do with the mis-posting of the cheque no. 000672 dated 5.12.19 for Kshs. 88,000/=, illegal dishonour of Cheque No. 000673 dated 11.12.19 for Kshs. 300,000/=, deletion of the offensive words in the Petitioner’s bank statement and an order directing CBK to formulate and issue a guiding policy for deletion of entries in their customers’ bank accounts and statement. These issues had not been raised in the previous suit. The Petitioner contended that the cause of action arising from the cheques in question could not be said to have been determined in the judgment in the former suit. In any event that it was not clear what the outcome of the previous litigation will be, as the matter is still pending determination at the Court of Appeal.
22.The doctrine of res judicata is set out in Section 7 of the Civil Procedure Act which provides:
23.For a party to succeed in an objection on ground of res judicata, such party must demonstrate each of the elements in Section 7 of the Civil Procedure Act. This requirement was set out by the Court of Appeal in the case of Independent Electoral & Boundaries Commission v Maina Kiai & 5 Others  eKLR, as follows:
24.And in the case of Suleiman Said Shabhal v Independent Electoral & Boundaries Commission & 3 others  eKLR, the Court of Appeal stated:
25.I have considered the issues raised herein and note that they relate to cheques issued in December 2019 and a bank statement for the same month. I have also perused the plaint in Nakuru CMCC No. 107 of 2018 dated 3.8.17 and amended on 25.5.18. The subject matter therein relates to events that took place in 2016. The Petitioner had issued a cheque for Kshs. 80,350/= in favour of Ogola, Kipkoech & Co Advocates in the belief that he had sufficient funds to cover the same. The cheque was however marked unpaid in his bank statement for April 2016 and an amount of Kshs. 3,300/= was debited from his account as unpaid cheque charge. Similarly, on 5.1.18 the Petitioner issued a cheque for Kshs. 900,000/= to Peter Kioko Kithuka. Although his account had a credit balance of Kshs. 935,654.80 the cheque was returned with the remarks “Crossing Stamp Cancelled”. The cheque was ultimately cleared 4 days later. He claimed that his letters demanding explanation went unanswered.
26.In HCCOMMM 605 OF 2003 Winfred Wambui King’ori v Paramount Bank Limited & Others, (unreported), Mativo, J. (as he then was) considered the elements of res judicata and stated:The learned Judge went on to state:
27.The previous suits were between the Petitioner and the Bank. The Petition herein is between the Petitioner and the Bank with the addition of CBK. This notwithstanding, it is now settled that mere addition or omission of a party in a subsequent suit or omission of a party does not necessarily render the doctrine of res judicata inapplicable. Other than the inclusion of CBK, the parties remain the same. The record shows that judgment in Nakuru CMCC No. 107 of 2018 was delivered on 3.9.19. This was clearly before the cause of action in this Petition arose. The matter directly and substantially in issue in the Petition, though similar, was not directly and substantially in issue in the previous suits. Further the appeal is still pending before the Court of Appeal. Accordingly, it cannot be said that the matter has been heard and finally decided in the former suit.
28.In view of the foregoing, I find and hold that the elements for res judicata have not been satisfied.
Whether the Petition offends the doctrine of constitutional avoidance
29.The Bank submitted that the claim by the Petitioner does not raise any constitutional issues. The alleged infringements as pleaded in the Petition raise issues in civil law and in particular, banking and contract law. As such the matter can comfortably be handled in the civil court.
30.On its part, CBK contended that the Petitioner’s remedy lies in civil law/court and not in this Court. CBK argued that the Petitioner categorically cited alleged breach of duty by the Bank. He also alleged breach of the Defamation Act, thereby making his claim a tortious transgression.
31.It is noted that the Petitioner did not address this issue but submitted that the Court is called upon to interrogate and declare unconstitutional and a nullity, the Bank’s position that that it cannot delete or expunge erroneous and misleading entries appearing in a bank statement. He further contended that the Bank’s edict in that regard, is not backed by law and falls afoul the ethos enshrined in Articles 28, 33(3), 35(2) 46(c) and 47(1) of the Constitution. He further submitted that the inaction by CBK leaves him an abandoned, helpless, disgruntled and aggrieved customer. His ultimate recourse for justice and relief for the losses suffered lies in the hands of this Court.
32.AS I consider this issue, I am aware that the doctrine of constitutional avoidance does not divest this Court of the jurisdiction to hear and determine this matter. What the doctrine means is that while this Court can indeed hear and determine the matter, it restrains itself from hearing the same because there exists another appropriate forum that can hear and determine the matter effectively.
33.The doctrine of constitutional avoidance was expounded by the Supreme Court in Communications Commission of Kenya & 5 others v Royal Media Services Limited & 5 others  eKLR. The Court held as follows: -(256)The appellants in this case are seeking to invoke the “principle of avoidance”, also known as “constitutional avoidance”. The principle of avoidance entails that a Court will not determine a constitutional issue, when a matter may properly be decided on another basis. In South Africa, in S v. Mhlungu, 1995 (3) SA 867 (CC) the Constitutional Court Kentridge AJ, articulated the principle of avoidance in his minority Judgment as follows [at paragraph 59]:(257)Similarly the U.S. Supreme Court has held that it would not decide a constitutional question which was properly before it, if there was also some other basis upon which the case could have been disposed of (Ashwander v. Tennessee Valley Authority, 297 U.S. 288, 347 (1936)).(258)From the foundation of principle well developed in the comparative practice, we hold that the 1st, 2nd and 3rd respondents’ claim in the High Court, regarding infringement of intellectual property rights, was a plain copyright- infringement claim, and it was not properly laid before that Court as a constitutional issue. This was, therefore, not a proper question falling to the jurisdiction of the Appellate Court.
34.And in the case of KKB v SCM & 5 others (Constitutional Petition 014 of 2020)  KEHC 289 (KLR) (22 April 2022) (Ruling), Mativo, J. (as he then was) had this to say about the doctrine:
35.It can be discerned from the foregoing that where another legal course is available, through which a matter can be properly decided and which can give an applicant the relief he seeks, such course should be pursued and the constitutional court should decline to determine a constitutional issue in such matter.
36.And in Uhuru Muigai Kenyatta v Nairobi Star Publications Limited  eKLR, Lenaola, J. (as he then was) stated:
37.The Court of Appeal in the case of Peter O. Ngoge v Francis ole Kaparo & 4 Others  eKLR, the Court of Appeal stated:
38.The prayers sought by the Petitioner in the Petition are civil in nature with civil remedies and could have readily been redressed in a civil court. The Petitioner ought to have filed a civil suit as opposed bypassing the same and coming to the constitutional court.
39.Having found that there exists a remedy in civil law, which the Petitioner ought to have pursued, this Court must refuse to be bogged down by a matter which is so plainly provided for under statute. In this regard, I associate myself with the sentiments expressed by Mativo, J. (as he then was in Mombasa Petition No. E002 of 2022, Jean Bosco Muhayimana & Another v Jimmy Irenge aka Jimmy Mwachugha & Others. (unreported) The Learned Judge stated:“When applying the Bill of Rights in a legal dispute, the principle of avoidance is of crucial importance. As we have seen, the Bill of Rights always applies in a legal dispute. It is usually capable of direct or indirect application and, in a limited number of cases, of indirect application only. The availability of direct application is qualified by the principle that the Bill of Rights should not be applied directly in a legal dispute unless it is necessary to do so.”
40.I similarly agree with Mutungi, J, who in the case of Grays Jepkemoi Kiplagat v Zakayo Chepkoga Cheruiyot  eKLR, had this to say about the practice of filing constitutional petitions in claims that are civil in nature:
41.And in Southlake Panorama Limited v Kenya Electricity Transmission Company Limited & 3 others  eKLR, Ohungo, J. stated as follows regarding the constitutional jurisdiction of the Court and I concur:
42.Having considered the foregoing, I find and hold that the Petitioner’s claim which is founded on his relationship with the Bank as its customer is a plain civil claim. Equally, the compensation contemplated in Article 23 of the Constitution may only be available to a claimant who proves denial, violation or infringement, or threat to a right or fundamental freedom in the Bill of Rights under Article 22. Accordingly, the Petition is not properly laid before this Court as a constitutional issue. As such, this Court invokes the doctrine of avoidance and declines jurisdiction.
Whether the Petition has met the threshold for a constitutional petition
43.It is the Bank’s submission that the Petition does not meet the threshold of a constitutional petition. The Bank submitted that it is not enough for the Petitioner to state that his constitutional rights have been violated but must demonstrate how such rights have been violated. The Bank contended that the Petitioner has alleged violation of his rights without proof of the manner of the violation. Accordingly, the Petition falls short of the requirements of a constitutional petition.
44.On its part, CBK submitted that the Petition does not meet the legal threshold of a constitutional petition, namely that a person seeking redress on a constitutional matter must set out with a reasonable degree of precision that of which he complains, the provisions infringed and the manner of infringement. It is thus the submission of CBK that the Petition which goes against the well-founded principle of pleading constitutional infringement with specificity, thereby rendering the Petition fatally defective.
45.Rule 4(1) of the Constitution of Kenya (Protection of Rights and Fundamental Freedoms) Practice and Procedure Rules, 2013 provides that any person affected or likely to be affected by the denial, violation or infringement or threaten to any right or fundamental freedom provided for in the Constitution may make an application to the High Court for redress. Rule 10(1) provides that an application under Rule 4 shall be made by way of a petition while Rule 10(2) stipulates what a petition is required to disclose, as follows:
46.All constitutional petitions are required to be pleaded with reasonable precision, and a party who alleges violation of rights must clearly state the nature of injury, the rights violated and the manner in which they have been violated. This principle was enunciated in the oft cited case of Anarita Karimi Njeru v Republic  eKLR in which Trevelyan and Hancox, JJs stated:
47.This principle was upheld in the case of Mumo Matemu v Trusted Society of Human Rights Alliance & 5 others  eKLR by the Court of Appeal, which observed as follows:
48.In Timothy Njoya v Attorney General & another  eKLR Lenaola J held: -
49.The Supreme Court in Communications Commission of Kenya & 5 others v Royal Media Services Limited & 5 others  eKLR held that:
50.In Humphrey Mutegi Burini & 9 others v Chief of the Kenya Defence Forces & another  eKLR, Mativo J, (as he then was) stated the following on pleading with precision:
51.Flowing from the cited Rules and cases, it is quite evident that for a constitutional petition to be sustainable a petitioner must cite the constitutional provisions that are alleged to have been violated or threatened and must also demonstrate the manner in which the said provisions have been violated or are threatened with violation from the facts and evidence of the case.
52.In the present case, the Petitioner stated as follows in Paragraph 26(i) of his Petition which is reproduced below:
53.Other than listing the constitutional provisions, the Petitioner has not given any specific details on how the Respondents have violated the said rights and fundamental freedoms. The Petition provides little or no particulars as to the allegations and the manner in which the Respondents are responsible for the alleged infringements. It is not sufficient to allege infringement without particularizing the details and manner of infringement. My finding therefore is the Petition does not meet the threshold for a constitutional petition.
Who is entitled to costs
54.It is trite that costs always follow the event. Rule 26(1) of the Constitution of Kenya (Protection of Rights and Fundamental Freedoms) Practice and Procedure Rules, 2013, provides that the award of the costs is at the discretion of the Court. Sub Rule (2) provides that in exercising its discretion to award costs, the Court shall take appropriate measures to ensure that every person has access to the Court to determine their rights and fundamental freedoms. In determining whether or not to award costs therefore, this Court must be mindful not to hinder the advancement of constitutional justice. The Court has found that the claim herein is a civil claim couched as a constitutional petition and ought not to have been filed in this Court in the first place. The Respondents are therefore entitled to costs for defending a needless petition.
55.In the end and in view of the foregoing, I find that the Petition herein lacks merit and the same is hereby dismissed with costs to the Respondents.
DATED AND DELIVERED IN NAIROBI THIS 17TH DAY OF MARCH 2023M. THANDEJUDGEIn the presence of: -for the Petitionerfor the 1 st Respondentfor the 2nd RespondentCourt Assistant