KENYA RE-INSURANCE CORPORATION V JUSTUS GACHIMU NGUNIA & PHILLIS NYAMBURA [2005] KEHC 3374 (KLR)
- Court
- High Court of Kenya
- Case number
- 3374
- Citation
- [2005] KEHC 3374 (KLR)
- Decided
- 22 July 2005
The Plaintiff is not entitled to interest at the rate of 24% per annum. The Plaintiff is entitled to interest at the contractual rate of 5% per annum from 1st March, 1985 to 3rd May, 1999.
Facts
The Plaintiff, KENYA RE-INSURANCE CORPORATION, advanced a staff loan to the 1st Defendant, JUSTUS GACHIMU NGUNIA, for the purchase of a plot of land. The loan was repaid with interest at an agreed rate of 5% per annum. The 1st Defendant resigned his employment in February 1985, owing the Plaintiff Kshs.160,073/00. The Plaintiff filed a suit for the outstanding loan amount and interest.
Issues
- Was the Plaintiff entitled to unilaterally raise the interest rate from 5% to 24%?
- Was the Plaintiff entitled to interest at the rate of 24% per annum?
Reasoning
The court is satisfied that the Plaintiff advanced a staff loan to the 1st Defendant and that the loan was repaid with interest at an agreed rate of 5% per annum. The court is not satisfied that the Plaintiff was entitled to unilaterally raise the interest rate from 5% to 24%. The Plaintiff is therefore entitled to interest at the contractual rate of 5% per annum.
Outcome
Judgment for the Plaintiff for the principal sum of Kshs.160,073/00 and interest at the contractual rate of 5% per annum from 1st March, 1985 to 3rd May, 1999.
Orders
- Interest at the contractual rate of 5% per annum from 1st March, 1985 to 3rd May, 1999.
- Interest at court rates until payment in full.
- The Plaintiff shall have the costs of the suit.
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