A communication firm has lost a bid to be paid Sh76 million by the owners of Garden City Mall for breach of contract.
Although the High Court found GC Retail Limited in breach of the contract entered into in 2015, the court said JohnGray Communication Ltd, a firm hired to manage signage, events, and other commercial activities at the popular mall, did not prove the losses alleged to have been suffered.
The court noted that the marketing manager did their part of the bargain to actualise the five-year contract.
“Applying that principle, I find that the Defendant’s (GC Retail Ltd) unilateral and immediate termination of the agreement, without notice, without invoking the permitted grounds, and without opportunity to remedy, constituted breach of contract,” said the court.
The court, however, said a party alleging breach of contract must go further and demonstrate the actual loss suffered.
“The court is only able to award damages where the plaintiff proves the fact and quantum of loss on a balance of probabilities. This position is consistent with the settled principle that damages are compensatory and must be anchored in evidence of actual loss,” said the court.
The court also dismissed a demand for compensation of Sh20 million for alleged loss of reputation.
While dismissing the claim, the court noted that JohnGray Communication Ltd was allowed to complete the existing contracts.
It was noted that the firm’s managing director John Kimani Muthami, admitted that all the payments were received and that no evidence was tendered of reputational injury or loss attributable to GC Retail Ltd.
In a win for GC Retail Ltd, the court allowed part of its counterclaim comprising unpaid invoices, revenue share from signage, and other sums.
Evidence tabled in court showed that the parties entered into a commercialisation arrangement at the popular mall on Thika Road, Nairobi, in 2015.
JohnGray Communication Limited said it was hired to provide services such as generating revenue from non-gross leasable areas, managing internal and external signage, and organising events and activations.
The marketing firm sought special damages of Sh76.3 million or, in the alternative, restitution for the value of services rendered, interest, and general damages for alleged loss of reputation.
“I therefore find that there was a binding agreement, partly written and partly by conduct, governing the commercialisation services,” said the court.
GC Retail Ltd denied the alleged breach and disputed the existence of any agreement beyond a memorandum of understanding dated May 25, 2015.
The mall owner then sought payment of Sh16.9 million comprising unpaid invoices, revenue share from signage, and other sums.
“The net substantiated unpaid amount is Sh 3,257,283.12/=. PW1 (Dr Kimani) was unable to dispute these figures, and indeed conceded under cross-examination that some items aligned with the Plaintiff’s own documentation,” said the court.
The court said the amount will attract interest at court rates from the date of this Judgment until payment in full. 470
