Helb battles Sh10m award over businesswoman's wrongful CRB listing

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A Sh10 million dispute pitting the Higher Education Loans Board (Helb) against a businesswoman over her erroneous listing with credit reference bureaus has escalated to the Court of Appeal.

This followed a High Court finding that Helb wrongly listed Eunice Nganga as a defaulter of a Sh8,000 loan it said it had disbursed to Maseno University in 1997, despite confirmation that she never received the money.

As the appeal proceeds, the Court of Appeal has rejected Ms Nganga’s bid to introduce fresh evidence that came into existence after the October 2020 High Court judgment. Some of the evidence was bank statements, M-Pesa messages and business agreements.

"It is evident that the evidence sought to be introduced was neither before the superior court nor in existence,” the judges said.

The dispute originates from a Helb loan application Ms Nganga made in 1995, which the Board initially rejected before approving it after her 1997 appeal.

Helb said it sent Sh8,000 to Maseno University, but Ms Nganga maintained that she never received the money.

The Board pursued her for repayment until 2016, when it reversed the Sh8,000 after accepting that she had not benefited from the loan.

But the dispute resurfaced after her name was listed with credit reference bureaus, classifying her as a defaulter.

Ms Nganga sued in March 2019, accusing Helb and the bureaus of violating her rights and damaging her business and professional reputation. She sought Sh45 million in damages, saying the listing damaged her restricted access to credit and affected her travel business.

Helb told the court that a system problem caused a data mix-up in December 2018 and that it subsequently instructed the bureaus to delete the erroneous information.

In its judgment, the High Court found that Helb nevertheless forwarded Ms Nganga’s details to the bureaus despite knowing she had not received the loan. The court said the Board had been told since 1999 that its information was inaccurate but failed to correct the same.

"Since 1999, the petitioner had severally informed the Board of the inaccuracy of the information they had been holding. The Board did not correct the information since 1999," it noted.

The court directed Helb to pay her Sh10 million in damages for infringement of her fundamental rights and freedom and for the estimated loss of business (including loss of income).

It also ordered the respondents to purge all adverse information in their records concerning the petitioner. Helb moved to the Court of Appeal to challenge this decision.

The latest Court of Appeal ruling concerns Ms Nganga’s application to introduce additional evidence.

Ms Nganga sought to admit a bank's credit facility letter, M-Pesa records, bank statements and business contracts generated after the judgment.

But the three-judge bench rejected the application, holding that an appeal must examine whether the trial court was correct using material available when judgment was made.

“In our view, the appellate process is concerned with reviewing the correctness of the decision of the trial court on the basis of the material that was available, or ought reasonably to have been available, at the time that the decision was made,” the judges said.

“The purpose of Rule 31 is not to enable parties to build a new evidentiary record after judgment and thereafter invite the appellate court to determine issues on the basis of post-judgment developments,” the court said.

The judges found that Ms Nganga had not met the legal threshold and dismissed her application.

Reporting originally appeared via Nation Africa. Read the full source for additional context.