Pride Inn Hotels has suffered a major legal setback after the Court of Appeal dismissed its bid to overturn a Sh2.1 million award granted to a firm contracted to operate an alcoholic beverages business in its Nairobi hotels.
A three-judge bench of the Court of Appeal comprising Wanjiru Karanja, Kathurima Inoti, and Lydia Achode upheld the High Court’s decision in favour of Thatchmaanz Limited, dismissing Pride Inn’s appeal in its entirety.
The hotel chain had challenged the award of Sh2,104,770, which was granted as damages for breach of contract.
“Consequently, upon re-evaluating the evidence afresh, we find no merit in this appeal. We uphold the trial court’s judgment and dismiss the appeal,” the appellate judges ruled.
Court Finds Contract Was Performed
In their judgment, the judges found that Thatchmaanz Limited had fully discharged its contractual obligation by supplying alcoholic beverages to Pride Inn, but the hotel failed to honour its payment obligations.
The court noted that Thatchmaanz produced unpaid invoices totaling Sh2,104,770, which clearly demonstrated the outstanding debt.
“We therefore find that Thatchmaanz Limited not only pleaded special damages but also strictly proved them,” the court held.
Third-Party Claim Against Managing Director Rejected
Pride Inn had also sought to shift liability to its Managing Director, Anthony Ngunga, through a third-party notice.
However, the Court of Appeal found no evidence that Pride Inn properly sought leave to serve the third-party notice through substituted service, nor that such proceedings were ever prosecuted in the trial court.
“There is no evidence that such an application was made or that service was effected on the Managing Director. Nothing therefore turns on this ground, which fails,” the judges ruled.
Hotel’s Grounds of Appeal Dismissed
Pride Inn had argued that the High Court erred in law and fact by finding that a valid contract existed between the parties, and by concluding that alcoholic beverages were supplied without sufficient proof.
The hotel further argued that the court failed to apply the legal principle of ex turpi causa non oritur actio, claiming the contract was illegal and against public policy.
It also faulted the trial court for awarding special damages allegedly not strictly proved, and for failing to enter judgment against Anthony Ngunga under Order 1 Rule 15 of the Civil Procedure Rules.
The appellate court rejected all these arguments, finding that the High Court properly analysed the evidence and reached a sound decision supported by the record.
Appeal Dismissed
The dismissal of the appeal means Pride Inn must now pay the Sh2.1 million award, bringing the long-running commercial dispute to an end.
