https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1653

Exclusive Estates Ltd v Telkom Kenya Ltd & 3 others (Civil Appeal (Application) E747 of 2025) [2026] KECA 1653 (KLR) (31 July 2026) (Ruling) Neutral citation: [2026] KECA 1653 (KLR) Republic of Kenya In the Court of Appeal at Nairobi Civil Appeal (Application) E747 of 2025 PO Kiage, J Mohammed & S ole Kantai, JJA July 31, 2026 Between Exclusive Estates Limited Appellant and Telkom Kenya Limited 1st Respondent Postel Housing Co-Operative Society 2nd Respondent Aftraco Limited 3rd Respondent Zehrabanu Janmohamed 4th Respondent (An application for an injunction from the ruling of the High Court of Kenya at Nairobi (Njoki Mwangi, J.) dated 17th January 2025 in HCC Suit No. 1158 of 2001) Ruling 1.Before this Court is a Notice of Motion dated 4th November 2025 by Exclusive Estates Limited (the applicant) expressed to be brought under Sections 3A and 3B of the Appellate Jurisdiction Act, Section 3(1) of the Judicature Act, the doctrine of lis pendens, the inherent jurisdiction of the Court, and Rule 5(2)(b) of the Court of Appeal Rules (this Court’s Rules). Telkom Kenya Limited, Postel Housing Co-Operative Society, Aftraco Limited and Zehrabanu Janmohamed are the 1st to 4th respondents respectively. 2.The notice of motion seeks the following orders:i.Spent.ii.Pending the hearing and determination of the appeal, that the status quo ante obtaining before the delivery of the ruling dated 17th January 2025, which preserved the suit property pursuant to the judgment of this Court in Nairobi Civil Appeal No. 135 of 2013, Exclusive Estates Ltd v Registrar of Titles & Others, directing the registration of a caveat over sixty (60) acres comprised in Land Reference No. 7656, Ngong Road, Nairobi (the suit property), be restored; and that the 1st and 2nd respondents, whether by themselves, their servants or agents, be restrained from seeking payment of the sum of Kshs.11,400,000,000, being the value of the said sixty (60) acres awarded to the 1st respondent in ELC Petition No. 11 of 2021;iii.Pending the hearing and determination of the appeal, that a sum of Kshs.11,400,000,000 out of the decretal amount of Kshs.15,000,000,000, or such proportion thereof as represents the value of the sixty (60) acres in respect of the suit property awarded to the 1st respondent in ELC Petition No. 11 of 2021, be deposited in a joint interest-earning escrow account in the names of the advocates for the applicant and the 1st respondent should the decretal sum be settled before the appeal is determined;iv.That the 1st respondent be directed to keep the applicant's advocates regularly informed of the progress made towards settlement of the decretal sum in ELC Petition No. 11 of 2021 and furnish confirmation of any payment made towards partial or full satisfaction of the decree;v.That this Court be pleased to make such further orders as it may deem just and expedient in the interests of justice;vi.That the costs of the application abide the outcome of the appeal. 3.The application is supported by the grounds set out on its face and by the supporting affidavit sworn by Mr. Mark Mungai Mburu (Mr. Mburu), a director of the applicant. He deposes, inter alia, that during the pendency of Milimani Commercial Case No. 1158 of 2001, the Government unlawfully took over the suit property, thereby precipitating the filing of Constitutional Petition No. 11 of 2021. 4.The deponent further avers that during the pendency of ELC Petition No. 11 of 2021, the existence of a Deed of Settlement (the Deed) dated 1st August 2018 came to light. That the Deed had been deliberately concealed from the Arbitrator (the 4th respondent herein) and from the Court during the proceedings in which an application to set aside the arbitral award was prosecuted. 5.The 2nd respondent did not file a response to the application. 6.In opposition to the application, the 1st respondent filed a replying affidavit sworn by Ms. Stella Wawira, its director, who deposes, inter alia, that the order appealed from is purely negative in nature and is, therefore, incapable of being stayed. That the applicant has previously sought substantially similar relief in Nairobi Civil Appeal (Application) No. E755 of 2023 and that the present motion amounts to an abuse of the process of the court and an attempt at forum shopping. Further, that the application is also caught up by the doctrine of sub judice, the earlier application for stay being still pending. Ms. Wawira further deposed that the doctrine of lis pendens has no application since the suit property has already been compulsorily acquired and developed, and that no legal basis exists for directing that the compensation payable to the 1st respondent be preserved in an escrow account. 7.The application is further opposed by the 3rd respondent through a replying affidavit sworn by Mr. Salim Sadru (Mr. Sadru), one of its directors. He deposes inter alia, that the instant application constitutes a blatant abuse of the court process and ought to be dismissed in limine. According to the deponent, the impugned ruling delivered on 17th January, 2025 concerned two preliminary objections challenging the jurisdiction of the trial court on the ground that the issues raised had already been conclusively determined by a court of competent jurisdiction. 8.The deponent further avers that although the impugned ruling was delivered on 17th January 2025, the instant application was not filed until November 2025, a delay which is inordinate and wholly unexplained. He contends that the invocation of urgency is, therefore, an afterthought. He further states that there are presently two (2) applications before this Court seeking substantially similar reliefs, thereby demonstrating deliberate duplication of proceedings and forum shopping. In Mr. Sadru’s view, the application improperly invites this Court to determine matters that were directly in issue before the ELC, and which remain the subject of pending proceedings. He, accordingly, urges that the application be dismissed with costs as being incompetent, devoid of merit and an abuse of the process of the Court. 9.From the record, the 4th respondent did not file a replying affidavit or written submissions and was not represented at the hearing of the application, despite service. Submissions by Counsel 10.The application was heard by way of written submissions with oral highlighting. Learned Senior Counsel Mr. Allen Gichuhi represented the applicant while learned counsel Mr. Nyaburi represented the 1st respondent. Learned counsel, Mr. Otieno was present holding brief for Mr. Nzala for the 2nd respondent while learned Senior Counsel, Mr. Ahmednasir Abdullahi appeared with learned counsel Ms. Wangui for the 3rd respondent. There was no appearance for the 4th respondent despite service. 11.Mr. Gichuhi submitted that the High Court (Njoki Mwangi, J.) erred by determining the Preliminary Objections before hearing the pending applications alleging perjury, concealment of the Deed and review. Mr. Gichuhi submitted that the appeal is arguable, inter alia, on the ground that the High Court erred in law by failing to consider the doctrine of lis pendens and the judgment of this Court in Nairobi Civil Appeal No. 135 of 2013 Exclusive Estates Ltd v The Registrar of Titles & Others which reinstated the caveat in favour of the applicant on the suit property. 12.On the nugatory aspect, counsel submitted that unless the stay orders are granted, the applicant will suffer irreparable loss as its interest in the suit property would have been lifted if the title is cancelled and it is unclear how the 1st respondent would refund the monies if the compensation sum is paid. 13.Mr. Nyaburi opposed the application and submitted that the intended appeal is not arguable as the issues raised therein were conclusively determined by the ELC (Oguttu Mboya, J.) in ELC Petition No. 11 of 2021. The said judgment of the ELC had not been set aside by the time the impugned ruling of the High Court was delivered and neither has it been set aside to date. Counsel further submitted that the instant application is an abuse of the court process as the applicant being aggrieved by the decision of the ELC (Oguttu Mboya, J.) filed an appeal to this Court (CA No. E755 of 2023). The applicant subsequently filed an application for stay pending appeal dated 3rd November 2023 seeking similar orders to those filed in the instant application. The applicant is guilty of forum shopping and exposing this Court to embarrassment and ridicule by presenting a scenario where it is possible to have two contradicting decisions in relation to the same matter. 14.On the nugatory aspect, counsel submitted that the order issued in the impugned ruling is a negative order. There is nothing to be stayed or injuncted by this Court. In the event the orders sought are declined and the appeal ultimately succeeds, the effect is that the suit will be reinstated for hearing and determination. In the event that the applicant succeeds in the reinstated suit the remedy will lie in damages considering that the suit property has already been compulsorily acquired by the Ministry of Sports, Culture & Heritage and Talanta Sports Stadium built thereon. The applicant has not argued that the 1st respondent will not be in a position to pay any damages which may be ultimately ordered. In the circumstances, the applicant’s appeal will not be rendered a paper victory. Accordingly, in the event that the orders sought are not granted, the appeal will not be rendered nugatory as the 1st respondent is capable of compensating the applicant by way of damages. 15.Counsel further submitted that in the event the orders sought are granted, the effect of those orders would be to vary the orders granted by the ELC (Oguttu Mboya, J.) 16.In conclusion, counsel submitted that the orders sought in the instant application fall outside the scope of Rule 5(2)(b) of this Court’s Rules. They do not seek for stay of execution of any orders from the ELC, nor do they seek an injunction of any action by the respondents, with a view to preserving the subject matter of the appeal. They are in the nature of mandatory injunction orders which are in part directed at entities who are not parties in respect of this matter. Counsel urged us to dismiss the application with costs to the 1st respondent. 17.Mr. Otieno informed the Court that the 2nd respondent supports the application. 18.Mr. Ahmednasir opposed the application and submitted that jurisdiction had to be determined first once challenged by way of Preliminary Objection, relying on the case of Mukisa Biscuit Manufacturing Co. Ltd v West End Distributors Ltd [1969] EA 696. Counsel submitted that Rule 5(2)(b) cannot be used to obtain substantive appellate relief or restore the status quo ante and that granting the orders sought would effectively determine the appeal before it is heard. 19.Mr. Ahmednasir further submitted that the prayer for status quo ante cannot be granted; this Court does not have jurisdiction to grant the orders of status quo ante as sought; granting the orders sought would amount to setting aside the impugned ruling; the applicant filed an appeal and an application against the judgment of the ELC (Oguttu Mboya, J.) raising the same issues as those raised in the instant application. Counsel further submitted that the application seeks to stay a negative order. Counsel relied on the decision of this Court in Western College of Arts and Applied Sciences v E.P. Oranga & Others [1976] KLR 63 in support of the proposition that a negative order, such as the dismissal of a suit is incapable of execution or a stay, except in respect of costs. Counsel submitted that the application is unmeritorious and urged that the same be dismissed with costs to the 3rd respondent. 20.In his brief rejoinder, Mr. Gichuhi submitted that this Court has jurisdiction to grant an order of status quo ante; and that this Court has inherent power to do justice and preserve the subject matter of the appeal. Determination 21.We have considered the application, the grounds in support thereof, the authorities cited and the law. The jurisdiction under Rule 5(2)(b) of this Court’s Rules is discretionary and guided by the interests of justice. 22.The principles for granting a stay of execution, injunction or stay of proceedings under Rule 5(2)(b) of this Court’s Rules are well settled. This Court in the case of Trust Bank Limited and Another v. Investech Bank Limited & 3 Others [2000] eKLR delineated the jurisdiction of this Court in such an application as follows:“The jurisdiction of the Court under Rule 5(2)(b) is original and discretionary and it is trite law that to succeed an applicant has to show firstly that his appeal or intended appeal is arguable, to put another way, it is not frivolous and secondly that unless he is granted a stay the appeal or intended appeal, if successful will be rendered nugatory. These are the guiding principles but these principles must be considered against facts and circumstances of each case…” 23.On the first principle, as to whether or not the appeal is arguable, we have to consider whether there is at least a single bona fide arguable ground that has been raised by the applicants that warrants ventilation before this Court. In Stanley Kang’ethe Kinyanjui v Tony Ketter & 5 Others [2013] eKLR this Court described an arguable appeal in the following terms:“vii)An arguable appeal is not one which must necessarily succeed, but one which ought to be argued fully before the court; one which is not frivolous.viii)In considering an application brought under Rule 5 (2) (b) the court must not make definitive or final findings of either fact or law at that stage as doing so may embarrass the ultimate hearing of the main appeal.” 24.On the nugatory aspect, the position in law is that this depends on whether or not what is sought to be stayed if allowed to happen is irreversible; or if it is not reversible, whether damages will reasonably compensate the aggrieved party. See: Stanley Kang’ethe Kinyanjui v Tony Ketter & 5 Others (supra). 25.It is well settled that for an application under Rule 5(2)(b) of this Court’s Rules to succeed, the applicant must satisfy both limbs of the twin principles as they are conjunctive. (See: Republic v Kenya Anti-Corruption Commission & 2 others [2009] eKLR 31, and Reliance Bank Ltd v Norlake Investments Limited [2002] 1 EA 227). 26.We have carefully considered the grounds set out in the motion. Counsel for the applicant submitted that the appeal is arguable inter alia as the High Court erred in law by failing to consider the doctrine of lis pendens and the judgment of this Court in Nairobi Civil Appeal No. 135 of 2013 that reinstated the caveat in favour of the applicant on the suit property. An arguable point is not necessarily one that must succeed, but merely one that is deserving of consideration by the Court. Without saying more lest we embarrass the bench that will be seized of the main appeal, we are satisfied that the intended appeal is arguable. 27.In determining whether an intended appeal would be rendered nugatory, this Court is required to consider the competing claims of the parties, each application being determined on its own peculiar facts and circumstances. As this Court stated in Stanley Kang'ethe Kinyanjui v Tony Ketter & 5 Others, (supra) the nugatory aspect depends on whether what is sought to be stayed is reversible or, if not, whether damages would reasonably compensate the aggrieved party. The Court further emphasized that the twin principles of arguability and the nugatory aspect are conjunctive, and an applicant must satisfy both limbs before relief under Rule 5(2)(b) may issue. 28.We are alive to the fact that the order impugned in the intended appeal is a negative order dismissing the applicant’s suit. Ordinarily, such an order is incapable of execution and therefore not amenable to an order of stay. However, the present application does not merely seek a stay of execution. The applicant also seeks an injunction pending appeal together with orders restoring the status quo ante. In that regard, this Court has recently affirmed that the fact that the impugned decision is a negative order does not, without more, deprive the Court of jurisdiction to grant an injunction under Rule 5(2)(b) of this Court’s Rules. In Adero & 3 Others v Douglas & 3 Others, Civil Application No. E103 of 2024; [2024] KECA 976(KLR), this Court declined to grant the order of injunction sought on the grounds that the applicants had failed to demonstrate that the appeal would be rendered nugatory; and because the order sought had been overtaken by events and would affect the rights of third parties. 29.In the present case, we are similarly unpersuaded that the applicant has satisfied the nugatory limb. Should the appeal ultimately succeed, the legal consequence would merely be the reinstatement of the suit for hearing and determination on its merits. Moreover, the suit property has already been compulsorily acquired by the Ministry of Sports, Culture & Heritage and the intended public project has since been undertaken thereon. Any loss that may ultimately be established is compensable in damages, and the applicant has neither alleged nor demonstrated that the 1st respondent would be incapable of satisfying any decree that may ultimately issue. In accordance with the principles enunciated in Stanley Kang’ethe Kinyanjui v Tony Ketter and 5 Others (supra), we are therefore unable to conclude that the intended appeal would be rendered nugatory if the orders sought are declined. 30.We further observe that the applicant seeks, in substance, to restore the status quo ante through orders in the nature of a mandatory injunction. Those orders are directed, in part, against third parties, including the Ministry of Sports, Culture & Heritage which is responsible for payment of compensation amounting to Kshs. 15,000,000,000 but is not a party to these proceedings. Granting the relief sought would inevitably affect the rights and obligations of persons or entities who are not before the Court without affording them a hearing would effectively reverse actions that have already been undertaken pursuant to the compulsory acquisition process. In these circumstances, and consistent with the approach adopted by this Court in Adero & 3 Others (supra), we are not persuaded that this is one of those exceptional cases warranting the grant of a stay of execution, an injunction or the restoration of the status quo ante at an interlocutory stage. 31.Accordingly, we find that the applicant has failed to demonstrate that the intended appeal would be rendered nugatory in the absence of the grant of the orders sought. The application, therefore, fails on the second limb of Rule 5(2)(b) of this Court’s Rules. 32.As the applicant is required to meet both limbs of Rule 5(2)(b) of thisCourt’s Rules, the application fails and is dismissed. 33.Costs of the application shall abide the outcome of the appeal. 34.It is so ordered. DATED AND DELIVERED AT NAIROBI THIS 31ST DAY OF JULY, 2026P. O. KIAGE……………………JUDGE OF APPEALJAMILA MOHAMMED………………………JUDGE OF APPEALS. ole KANTAI………………………JUDGE OF APPEALI certify that this is a true copy of the originalSignedDEPUTY REGISTRAR