https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1249

Eastern Africa Grain Council v Mokua & 5 others (Civil Appeal (Application) E961 of 2025) [2026] KECA 1249 (KLR) (3 July 2026) (Ruling) Neutral citation: [2026] KECA 1249 (KLR) Republic of Kenya In the Court of Appeal at Nairobi Civil Appeal (Application) E961 of 2025 W Karanja, K M'Inoti & WK Korir, JJA July 3, 2026 Between Eastern Africa Grain Council Applicant and Jane Mokua 1st Respondent Vennah Kwamboka 2nd Respondent James Kuria 3rd Respondent Martha Njogu 4th Respondent Samwell Rutto 5th Respondent Emmanuella Atito 6th Respondent (An application for stay of execution of the judgment of the Employment and Labour Relations Court of Kenya at Nairobi (Rutto, J.) dated 21st October, 2025 in ELRC E106 of 2023) Ruling 1.Before this Court is a notice of motion dated 13th November 2025 filed by the applicant, Eastern Africa Grain Council, seeking an order staying execution of the judgment of the Employment and Labour Relations Court (S. Rutto, J.) delivered on 21st October 2025 in Nairobi ELRC Cause No. E106 of 2023, the resulting decree and any further proceedings related thereto, pending the hearing and determination of the intended appeal. 2.In the impugned judgment, the learned Judge found the applicant liable to honour its contractual obligation by paying the respondents their accrued gratuity in the sum of Kshs. 851,731.27 for the 1st respondent, Kshs. 1,097,914.62 for the 5th respondent, and Kshs. 542,363.49 for the 6th respondent, together with interest from the date of filing suit until payment in full, plus costs of the suit. The claims by the 2nd, 3rd and 4th respondents were compromised in the course of the proceedings. 3.The application is supported by the affidavit sworn on 13th November 2025 by the applicant’s Executive Director, Mr. Gerald Makau Masila. Mr. Musila avers that the applicant has filed a Memorandum of Appeal raising eleven arguable points, among them being the erroneous finding at paragraph 55 of the judgment that financial constraints did not absolve the appellant from its contractual obligations to the respondents contrary to the express contractual term on payment of gratuity contained in Clause VIII of the respondents’ employment contracts to the effect that the funding of the applicant shall always determine the sustainability of the agreement. 4.The applicant further avers that it had remitted to the Fund Manager all the funds in respect of the outstanding gratuity. The applicant contends that if the decretal sums are paid to the respondents, and in the event the intended appeal succeeds, it would be rendered nugatory because of the difficulty of recovery since the respondents are impecunious and unemployed, with their sources of income and whereabouts unknown. Specifically, the applicant deposes that the 5th and 6th respondents are out of the jurisdiction of the Court because they are outside the country. According to the applicant, the respondents will suffer no prejudice if the order sought is granted since the gratuity funds are already with the Fund Manager. 5.When the application came up before us for hearing, learned counsel Mr. Kimata appeared for the applicants. Learned counsel Ms. Cheruto was in attendance for the 1st, 5th and 6th respondents. Mr. Kimata had filed written submissions which he sought to rely on. On the other hand, Ms. Cheruto had not filed any response or submissions, citing technological challenges. Nevertheless, the hearing proceeded. 6.Through the filed submissions, Mr. Kimata submitted that the Court was properly seized of the application under rule 5(2)(b) as the applicant had filed a Notice of Appeal within the stipulated timelines. Counsel referred to Stanley Kangethe Kinyanjui vs. Tony Ketter & 5 Others [2013] KECA 378 (KLR), where this Court comprehensively summarised the principles governing applications under rule 5(2)(b) and argued that the applicant had met the conditions for the grant of the orders sought. Counsel, while relying on Damji Pragji Mandavia vs. Sara Lee Household & Body Care (K) Ltd, Civil Application No. Nai 345 of 2004, reiterated that the intended appeal raised arguable grounds, asserting that it was sufficient if a single bona fide arguable ground of appeal existed. Citing National Industrial Credit Bank Ltd vs. Aquinas Francis Wasike & Another [2006] KECA 333 (KLR), counsel argued that while the legal duty is on an applicant to prove that an appeal would be rendered nugatory because a respondent would be unable to pay back the decretal sum, it is unreasonable to expect an applicant to know in detail the resources owned by a respondent. He submitted that once an applicant expresses a reasonable fear that a respondent would be unable to repay the decretal sum, the evidential burden shifts to the respondent to show what resources he has, as that is a matter peculiarly within his knowledge. 7.There’s no dispute that a Notice of Appeal was filed on 4th November 2025, thereby properly invoking the jurisdiction of this Court under rule 5(2)(b) of the Court of Appeal Rules. The sole issue for determination is whether the applicant has satisfied the twin principles to warrant the grant of an order of stay of execution pending appeal. 8.An applicant who invokes the discretionary jurisdiction of the Court for grant of orders under rule 5(2)(b) of the Rules of this Court must not only present an arguable appeal but must also demonstrate that without an order of stay, the appeal will be rendered nugatory. We remind ourselves that an arguable appeal is not one which must necessarily succeed, and that even a single arguable point is sufficient for the Court to exercise its jurisdiction in favour of the applicant. These principles have been reiterated in a plethora of decisions of this Court, including Montague Charles Ruben & 9 Others vs. Peter Charles Nderito & Another [1989] KECA 70 (KLR), wherein it was held that:“In dealing with rule 5(2)(b) applicants, this Court exercises original jurisdiction and this has been so stated in a long line of cases decided by this Court. Once an applicant has properly come before the Court, the Court has jurisdiction to grant an injunction or make an order for a stay on such terms as the Court may think just. We have to apply our minds denovo (anew) on the propriety or otherwise of granting the relief sought. And as we have always made clear, this exercise does not constitute an appeal from the trial judge’s discretion to ours. In such an application, the applicant must show that the intended appeal is not frivolous, or put the other way round, he must satisfy the court that he has an arguable appeal. Secondly, it must be shown that the appeal, if successful, would be rendered nugatory: See Stanley Munga Githunguri vs. Jimba Credit Corporation Ltd Civil Application No. NAI. 161 of 1988.” 9.Turning to the first limb, we have examined the draft memorandum of appeal annexed to the supporting affidavit. The applicant has raised several grounds of appeal, one of them being that the learned Judge erred in finding that financial constraints did not absolve the applicant from its contractual obligations, contrary to the express terms of the respondents’ employment contracts, which made the payment of gratuity subject to the availability of funding. In our view, this ground, among others, is not frivolous. It is arguable and ought to be argued fully before the Court. As already stated, an arguable appeal is not one which must necessarily succeed, but one which is not frivolous. Without speaking more to this point lest we embarrass the bench that will eventually hear the appeal, we find that the applicant has satisfied the first limb. 10.Turning to the second limb, the applicant has expressed a fear that if the decretal sum is paid over to the respondents, the success of the intended appeal would be rendered nugatory because the respondents are impecunious, unemployed, their sources of income unknown, while some are outside the jurisdiction of the Court. The applicant’s apprehension is reasonable and remains uncontroverted. 11.In National Industrial Credit Bank Ltd vs. Aquinas Francis Wasike & Another (supra), the Court held that once an applicant expresses a reasonable fear that a respondent would be unable to pay back the decretal sum, the evidential burden shifts to the respondent to show what resources he has. The respondents have not discharged that burden. We are accordingly persuaded that if the decretal sum is paid out, the applicant may well be unable to recover the same, thereby rendering the success of the intended appeal nugatory. 12.In plenary, Mr. Kimata pointed out that the applicant had deposited the respondent’s gratuity with the Fund Manager and that the applicant was only apprehensive that, in the event an order of stay is not granted, the applicant will be required to pay the interest awarded by the trial court. Indeed, the applicant has demonstrated that the funds are already with the Fund Manager. No prejudice will therefore be occasioned to the respondents if a stay is granted, as the funds are preserved and will be available to them should the appeal ultimately fail. 13.In the result, we find merit in the Notice of Motion dated 13th November 2025. Consequently, we hereby issue an order staying execution of the impugned judgment, consequential orders and decree, and any further proceedings in ELRCC No. E106 of 2023, pending the hearing and determination of the intended appeal. For the avoidance of doubt, the order applies to the 1st, 5th and 6th respondents only. 14.There being a pending appeal, the costs of this application shall be in the appeal. DATED AND DELIVERED AT NAIROBI THIS 3RD DAY OF JULY 2026.W. KARANJA................................ JUDGE OF APPEALK. M’INOTI................................ JUDGE OF APPEALW. KORIR................................ JUDGE OF APPEALI certify that this is a True copy of the originalSignedDEPUTY REGISTRAR