On finality of judgments: The Case of Kanwal Sarjit Singh Dhiman v Keshavji Jivraj Shah ([2025] KECA 1264)

Case Citation: Dhiman v Shah (Civil Appeal E380 of 2023)
Court of Appeal at Nairobi
Judgment date: 11 July 2025
Judges: P.O. Kiage, W.K. Korir & J.M. Ngugi (Full Case available here)

⚖️ Background & Procedural History

• High Court Suit (1999):
  Keshavji Jivraj Shah sued Dhiman for recovery of a Ksh 7 million loan (plus interest), secured by a property charge. Dhiman failed to file a defense, resulting in an interlocutory judgment on 16 Sept 1999 for ~Ksh 17 million, at 36% interest (See Case here,).
• Execution & Asset Sale:
  The plaintiff sought execution, purchased Dhiman’s property at auction (Ksh 17 million), and obtained a Vesting Order on 13 June 2006. An eviction order followed ( Check Case here).
• High Court Review Application (2006):
  Dhiman applied to review the ex parte judgment and sought leave to file a defense. He claimed he had been misled into settlement talks, paid Ksh 3 million, and argued duress, illegality, unconscionable interest, and improper sale. Kasango J dismissed the application in December 2006 (See Case here).
• Court of Appeal – First Proceedings – 2010 & 2015:
  Leave to amend the appeal was granted in 2010, allowing Dhiman to challenge the ex parte judgment (2019 Judgment, See Judgment here). The 2015 decision reaffirmed factual history and interlocutory judgment events.
• High Court – Application to Strike Defense & Confirm Decree (2018):
  Shah sought to strike out Dhiman’s defense and counterclaim. The court upheld the defense as raising triable issues and emphasized substantial justice over procedural technicalities (See Case here).
• High Court Judgment (2019):
  Justice Makau reviewed pleadings, reaffirmed interlocutory judgment, and preserved Dhiman’s chances to defend—subject to the Court of Appeal outcome (Full Case).

 The Appeal to the Court of Appeal (2025)

Issue before the Court:

i.                      Whether the High Court rightly refused to review the ex parte interlocutory judgment and set aside subsequent orders, given alleged irregularities, duress, and improper execution/Whether the High Court erred in refusing to review and set aside the interlocutory judgment.

ii.                    Whether the appellant had established grounds for review under Order 45 Rule 1 of the Civil Procedure Rules.

iii.                  Whether enforcement of the judgment violated principles of fairness and justice.

 Rules Applied

• Order 45 Rule 1, Civil Procedure Rules:
  Grounds for review:
• Discovery of new and important matter or evidence not previously available.
• Mistake or error apparent on the face of the record.
• Any other sufficient reason.
• Principles of natural justice and equity.

Key Legal Considerations:

• Grounds for review under Civil Procedure Rules—whether there was “new evidence,” “mistake apparent on face of record,” or delay “without unreasonable delay”.
• Whether Dhiman had demonstrated valid grounds (duress, unconscionable mortgage, illegality, misuse of process) warranting relief.
• Weighed principles of finality of judgments and public interest against ensuring substantive justice.

 Court's Reasoning

• The Court emphasized the finality of judgments, noting that Dhiman had not acted promptly or with due diligence.
• Allegations of duress and unconscionable conduct were not substantiated with sufficient legal or evidentiary basis.
• The interest rate, though high, was agreed upon and not illegal per se.
• There was no error on the face of the record, nor any newly discovered evidence to justify review.

 Court’s Holding/Decision (11 July 2025):

• The Court dismissed the appeal./ The Court concluded Dhiman's review grounds were unsustainable/ Appeal dismissed with costs to the respondent.)
• Found no error or sufficient new evidence to warrant review./ They found no mistake apparent and no new evidence that he had exercised due diligence to bring before the court
• Upheld the interlocutory judgment, execution, and vesting orders./ the application was dismissed, upholding the interlocutory judgment and vesting orders./ Interlocutory judgment (1999) remains effective.

• Execution orders, property sale, Vesting Orders, and eviction stay in force. (i.e. Judgment and orders of the High Court affirmed.)

Legal Implications

• Strict procedural standards: Ex parte judgment reviews require clear, fresh evidence or obvious errors. Reinforces the limited scope of review and strict standards under Order 45 of the Civil Procedure Rules.
• Finality vs justice: Courts reinforce the need to adhere to rules to preserve public confidence in process. It Underscores courts’ preference for finality and certainty in litigation, especially where execution has occurred.
• Necessity of timely challenge: Delays and engaging in informal negotiations can impede review applications. It Highlights the importance of procedural compliance and acting without delay.