[2022] KEHC 11964 (KLR)

Elijah & another v Iseu (Civil Appeal 20 of 2021) [2022] KEHC 11964 (KLR) (16 March 2022) (Ruling)

Neutral citation: [2022] KEHC 11964 (KLR)

Republic of Kenya

In the High Court at Kajiado

Civil Appeal 20 of 2021

SN Mutuku, J

March 16, 2022

Between

Patrick Murithi Elijah

1st Applicant

Irene Githinji

2nd Applicant

and

Serah Mueni Iseu

Respondent

Ruling

1. Patrick Murithi Elijah and Irene Githinji (the applicants) have brought this Notice of Motion Application dated September 21, 2021under order 22 rule 22, order 42 rules4, 6,and 7, order 51 rules 1 and 3 of the Civil Procedure Rules and sections 3, 3A and 79G of the Civil Procedure Act and all other enabling provisions of the law. The applicants are seeking the following orders:a.Spentb.That this honourable court be pleased to grant a stay of execution of the ruling issued by honourable E. Mulochi in Kajiado CMCC No. 32 of 2020 on August 30, 2021pending the hearing and determination of this application.c.That this honourable court be pleased to grant a stay of execution of the ruling issued by honourable E. mulochi in kajiado cmcc no. 32 of 2020 on August 30, 2021pending the hearing and determination of this appeal in Kajiado Civil Appeal No. 20 of 2021. d.That this honourable court be pleased to set aside the judgment and or decree by the honourableE. Mulochi in Kajiado CMCC No. 32 of 2021 on April 26, 2021pending the hearing and determination of this application.e.That this Honourable court be pleased to set aside the judgment and or decree by the honourable E. Mulochi in Kajiado CMCC No. 32 of 2021 on April 26, 2021pending the hearing and determination of thisappeal in Kajiado Civil Appeal No. 20 of 2021. f.That this honourable court allow the applicants to furnish the court with security in the form of a bank guarantee from the DTB Bank.g.That the application be heard inter partes on such date and time as this honourable court may direct.h.That costs of this application abide the outcome of the appeal.i.That this honourable Court be pleased to issue any other order and/or direction it deems fit to grant in the circumstances.

2. The application is supported by grounds found on the face of it and in the supporting affidavit sworn by Irene Githinji on the September 21, 2021 that she is the insured of motor vehicle registration No. KAU 297C; that the Appellants were found 100% liable in a Judgment delivered April 26, 2021; that the respondent was awarded Kshs 350,000 in general damages and Kshs 20,550 in special damages with costs and interest; that theapplicants are dissatisfied with the award and have preferred an appeal; and that they brought an application for stay but the trial court dismissed the same on August 30, 2021.

3. It is further stated that the appeal has high chances of success and that if stay is not granted, the applicants stand to suffer irreparable damage and that theirappeal will be rendered nugatory. It is stated that the respondent will not suffer any prejudice and that if the judgment is executed, the respondent will not be able to repay them since her financial standing has not been disclosed. the applicants state that their insurance company is willing and ready to provide security in the form of a bank guarantee.

4. Thisapplication was canvassed by written submissions. The applicants filed their submissions on December 10, 2021. In the submissions they have argued that if stay is not granted they stand to suffer irreparable loss. They cited the case of RWW v EKW [2019]eKLR where the court, while addressing the issue of stay pending appeal stated as follows:“The purpose of an application for stay of execution pending an appeal is to preserve the subject matter in dispute so that the rights of the appellant who is exercising the undoubted right of appeal are safeguarded and the appeal if successful, is not rendered nugatory. However, in doing so, the court should weigh this right against the success of a litigant who should not be deprived of the fruits of his/her judgment. The court is also called upon to ensure that no party suffers prejudice that cannot be compensated by an award of costs.”

5. Secondly, they have submitted that the application was made without unreasonable delay. They submitted that the Ruling was delivered on August 30, 2021and this notice of motion was filed on September 21, 2021.

6. Thirdly, they argued that they are willing to provide security for costs. They cited Focin Motorcycle Co. Limited v. Ann Wambui Wangui & another [2018] eKLR where it was stated that:“Where the applicant proposes to provide security as the applicant has done, it is a mark of good faith that the application for stay is not just meant to deny the respondent the fruit of judgment. My view is that it is sufficient for the applicant to state that he is ready to provide security or to propose the kind of security but it is the discretion of the Court to determine the security. The applicant has offered to provide security and has therefore satisfied this grounds for stay.”

7. They argue that this application is meritorious and ought to be allowed.

8. On the other hand are the submissions by the respondent filed on November 25, 2021. It is her argument that the appellants have not proved that they are likely to suffer substantial loss should the appeal fail; that the mere fact that they would have to pay the decretal sum does not amount to substantial loss on their part and that they have failed to prove that they will suffer anything more than just paying to the respondent the decretal amount.

9. The respondent cited Misc. Application No. 42 of 2011, James Wangalwa & Another v Agness Naliaka Cheseto where the court stated that:“The Applicant must establish other factors which show that the execution will create a state of affairs that will irreparably affect or negate the very essential core of the Applicant as the successful party in the appeal. That is what substantial loss would entail.”

10. The respondent also cited Century Oil Trading Company Ltd v Kenya Shell LimitedNairobi (Milimani) HCMCA No. 1561 of 2007 where it was held that:“…The court has to balance the interest of the application who is seeking to preserve the status quo pending the hearing of the appeal so that his appeal is not rendered nugatory and the interest of the respondent who is seeking to enjoy the fruits of his judgment.”

11. The respondent argued that the judgment herein was for monetary value and since the respondent has won the first hurdle, she should be entitled to enjoy some bit of the fruits of the judgment by releasing some payments to her.

12. The respondent submitted that in the event the court is persuaded to grant stay of execution to the appellant, then the court ought to grant the following conditions:a.That the appellant do release half of the decretal sum in Kajiado CMCC No. 32 of 2o2o to the decree holders’ Advocates.b.That the balance of the decretal sum be deposited in a joint interest earning account of both advocates on record till the said appeal is heard and fully determined.c.That the above conditions be complied with within 30 days.

13. Order 42 rule 6 (1) and (2) of the Civil Procedure Rules provides as follows in respect of stay pending appeal:(1)No appeal or second appeal shall operate as a stay of execution or proceedings under a decree or order appealed from except in so far as the court appealed from may order but, the court appealed from may for sufficient cause order stay of execution of such decree or order, and whether the application for such stay shall have been granted or refused by the court appealed from, the court to which such appeal is preferred shall be at liberty, on application being made, to consider such application and to make such order thereon as may to it seem just, and any person aggrieved by an order of stay made by the court from whose decision the appeal is preferred may apply to the appellate court to have such order set aside.(2)No order for stay of execution shall be made under subrule (1) unless—(a)the court is satisfied that substantial loss may result to the applicant unless the order is made and that the application has been made without unreasonable delay; and(b)such security as the court orders for the due performance of such decree or order as may ultimately be binding on him has been given by the applicant.

14. From the above provisions, the conditions to be met by an applicant seeking stay of execution pending an appeal are that:i.The applicant is likely to suffer substantial loss unless the order for stay is made;ii.That the application seeking stay has been made without unreasonable delay; andiii.The applicant seeking stay has provided security for the due performance of the decree or order.

15. Flowing from these conditions is the question as to whether the applicants herein have met the threshold for the grant of stay pending the appeal. I have noted from their application that they are seeking, in prayers 2 and 3, to be granted stay of execution of the ruling issued on August 30, 2021 in Kajiado CMCC No. 32 of 2020 pending the hearing and determination of this Notice of Motion and pending the hearing and determination of Kajiado High Court Civil Appeal No. 20 of 2021 respectively. In prayers 4 and 5, the applicants are seeking setting aside of the judgment and decree in the same matter delivered on April 26, 2021 pending the hearing and determination of this application and appeal respectively. The ruling delivered on August 30, 2021 sought stay of execution of the judgment delivered on April 26, 2021.

16. If this court were to grant prayers 4 and 5 and set aside the judgment of the lower court, the effect would be to determine the appeal before the parties are heard. This would be prejudicial to the Respondent who would be condemned unheard. I am not sure the applicants know what they are seeking in prayers 4 and 5 of their notice of motion.

17. As submitted, there is need to balance the rights of an applicant seeking stay of execution pending an appeal by preserving the subject matter in dispute lest the appeal be rendered nugatory and the rights of a successful litigant who should not be deprived of the fruits of his/her judgment. In so balancing those competing rights, the court must ensure that no party is prejudiced in a way that cannot be compensated by an award of costs.

18. By paying the award in general and special damages, the applicants would be satisfying a decree upon their being found 100% liable. What loss are they likely to suffer and would this loss, if any, be substantial? They have submitted that the financial standing of the Respondent is not known and that if the amount in damages is paid to her and the appeal is successful, they may not recover their money.

19. It is true that the respondent has not shown her financial standing and the impact of the money being paid to her is not clear given that this court has not been given anything to go by in terms of whether she is able to repay that money. There may be a point of substantial loss. However, this impact can be mitigated by having the amount in general damages deposited in a safe place as we await the outcome of the appeal.

20. While I note that the application for stay was made without unreasonable delay, it is my considered view that to safeguard the rights of both the applicants and the respondent, this court hereby grants stay of execution of the judgment and decree of the lower court pending the hearing and determination of the appeal in the following terms:i.That the amount in general damages being Kshs 350,000 be deposited in an interest earning joint account in the name of the advocates for the Applicants and those of the Respondent pending the hearing and determination of the appeal herein.ii.That this be done in the next 45 days from today’s date.iii.That the applicants do, within 45 days file and serve a record of appeal and submissions.iv.That upon service, the respondent does file response and submissions within 21 days.v.That costs of this application be in the cause.vi.That this matter shall be mentioned on June 23, 2022 for compliance and further orders.

21. Orders shall issue accordingly.

DATED, SIGNED AND DELIVERED THIS 16THDAY OF MARCH 2022. S. N. MUTUKUJUDGE