[2012] KEHC 3019 (KLR)

[2012] KEHC 3019 (KLR)

The court determined that the appropriate rate of interest on the judgment sum awarded in US dollars should be the rate at which a local commercial bank would charge a customer for borrowing in US dollars as at the date of judgment, specifically the US dollar LIBOR rate as at 14 February 2012. The court rejected the application of the standard court rate or an arbitrary commercial rate, instead aligning with the principle that interest should reflect the cost of borrowing the relevant currency. The court further held that the Plaintiff, having obtained judgment in US dollars, is entitled to payment in that currency, and if conversion to Kenya Shillings is desired, the applicable rate is...

Citation
[2012] KEHC 3019 (KLR)
Parties
Plaintiff: Finejet Limited; Defendant: Five Forty Aviation Limited
Court
High Court
Court Station
High Court at Nairobi (Milimani Law Courts)
Jurisdiction
Kenya
Judgment Date
23 July 2012
Case Number
Civil Case 331 of 2011
Procedural Posture
Notice of Motion / Post Judgment Application for Interpretation of Order and Determination of Interest and Conversion Rate
Outcome
Application allowed in part; court clarifies interest and conversion rate applicable to the judgment sum.
Judges
JB Havelock
Legal Topics
Foreign Currency Judgments, Interest Awards, Exchange Rate Determination, Commercial Contracts
Source Language
English
Civil Procedure Commercial and Corporate Foreign Currency Judgments Interest Awards Exchange Rate Determination Commercial Contracts

Case Brief

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Parties

Finejet Limited

Plaintiff

Five Forty Aviation Limited

Defendant

Procedural Posture

Notice of Motion / Post Judgment Application for Interpretation of Order and Determination of Interest and Conversion Rate

Legal Issues

  1. 1 What is the appropriate rate of interest to apply to a judgment sum awarded in US dollars.
  2. 2 What is the applicable period for the accrual of interest on the judgment sum.
  3. 3 What is the correct conversion rate and date for converting the judgment sum from US dollars to Kenya Shillings, if required.

Ratio Decidendi

The court determined that the appropriate rate of interest on the judgment sum awarded in US dollars should be the rate at which a local commercial bank would charge a customer for borrowing in US dollars as at the date of judgment, specifically the US dollar LIBOR rate as at 14 February 2012. The court rejected the application of the standard court rate or an arbitrary commercial rate, instead aligning with the principle that interest should reflect the cost of borrowing the relevant currency. The court further held that the Plaintiff, having obtained judgment in US dollars, is entitled to payment in that currency, and if conversion to Kenya Shillings is desired, the applicable rate is...

Court Disposition

Application allowed in part; court clarifies interest and conversion rate applicable to the judgment sum.

Orders

  • Interest on the judgment sum of US$656,304.49 shall accrue at the US dollar LIBOR rate as at 14 February 2012.
  • Interest on taxed costs (in Kenya Shillings) shall accrue at court rates.