[2022] KEHC 10819 (KLR)

Kadere Peasants Development (Public Limited Company) PLC v Brazafric Enterprises Limited (Civil Case E554 of 2020) [2022] KEHC 10819 (KLR) (Commercial and Tax) (13 June 2022) (Ruling)

Neutral citation: [2022] KEHC 10819 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Commercial Courts Commercial and Tax Division)

Commercial and Tax

Civil Case E554 of 2020

DAS Majanja, J

June 13, 2022

IN THE MATTER OF THE FOREIGN JUDGMENTS (RECIPROCAL ENFORCEMENT) ACT

Between

Kadere Peasants Development (Public Limited Company) PLC

Plaintiff

and

Brazafric Enterprises Limited

Defendant

Ruling

1. Before the court is the defendant’s application dated October 21, 2021 made under sections 2(a),8(4)(b) and (2) of the Foreign Judgments (Reciprocal Enforcement) Act (Chapter 43 of the Laws of Kenya) (“the Act”) and Rules 4,5 and 6 of the Foreign Judgment (Reciprocal Enforcement) Rules. The defendant seeks to set aside the registration order dated January 21, 2021 where this court registered the judgment issued by the High Court of the United Republic of Tanzania at Mwanza (Commercial Division) in Commercial Case No. 3 of 2014.

2. The application is supported by the affidavit and supplementary of its Deputy Managing Director, John Kilongosi sworn on October 21, 2021 and December 20, 2021 respectively. It is opposed by the plaintiff through the replying affidavit of its Managing Director, Leonard Faustin Kache Bonaho, sworn on December 20, 2021.

3. On November 9, 2021, the court granted an order of stay on condition that the defendant deposits KES 2,000,000. 00 in court or provides a bank guarantee for the same amount within 14 days. The application to set aside came up hearing on December 21, 2021 where, after hearing the parties, I ruled as follows:I have heard the parties and it appears that there is still in place a process where the Defendant intends to challenge the Judgment which has now been registered at the Court of Appeal in Tanzania. Both parties concede that the Judgment in Tanzania has not been set aside. Under section 11(2)(b) of the Act, this court may adjourn the application to enable the defendant pursue its application to set aside or appeal on such terms as it deems just.I therefore decline to set aside the registration order and adjourn the application for a period of 45 days to enable the defendant establish to this court that the appeal is pending or that the judgment has been set aside. In the meantime, the guarantee dated November 9, 2021 shall remain in place pending further directions and orders on February 4, 2022. The defendant shall pay costs of the application.

4. After the ruling, the Defendant filed another application, the Notice of Motion dated 3rd March 2022 seeking extension of time to comply with the order of December 22, 2021 above. The application is supported the affidavit and further affidavit of Joseph Kilongosi sworn on March 3, 2021 and 5th April respectively. It is opposed by the replying affidavit of Aaron Kabunga sworn on April 25, 2022. The Defendant filed a further affidavit of Joseph Kilongosi sworn on May 10, 2022.

5. Based on the evidence and having declined to set aside the registration by the order of December 21, 2021, I am now called upon to decide whether there is a pending appeal in the Republic of Tanzania in terms of sections 2, 10 and 11 of the Act. From the depositions that have been filed by the parties, the prevailing facts are common ground and are as follows.

6. On April 3, 2014, Plaintiff herein filed suit against the defendant at the High Court of the United Republic of Tanzania, Commercial Division at Mwanza; Commercial Case No. 03 of 2014, Kaderes Peasants Development PLC v Brazafric Enterprises Ltd claiming, inter alia, damages for breach of contract. On 3rd June 2016, the court entered default judgment upon failure of the defendant to filed its Statement of Defence despite service of summons upon it. According to the proceedings, the Defendant filed an application to set aside the judgment by the same was dismissed on 5th September 2014. It filed an appeal in the Court of Appeal, Tanzania; Civil Appeal No. 123 of 2014 but the appeal was struck out on December 11, 2015. The Defendant successfully applied for extension of time to appeal but failed to file the Notice of Appeal. Its application to seek another extension was struck out on 1st November 2018 and the subsequent application to the Court of Appeal, Tanzania; Civil Application No. 32 of 2008 was also struck out on October 9, 2019. On November 13, 2020, the High Court in Tanzania approved the Forms necessary for the Plaintiff to execute the judgment in Kenya.

7. On August 5, 2021, the defendant once again filed an application dated August 2, 2021 in the Court of Appeal at Mwanza; Civil Application No. 421/08 of 2021 seeking extension of time in which to institute an appeal from the ruling and order dated 18th November 2018 in the High Court Mwanza, Commercial Division, Misc. Commercial Application No. 323 of 2017. The application is still pending determination before the Court of Appeal.

8. From the facts deponed and the parties’ submissions, the question for determination then is whether the pending application is an appeal within the meaning of sections 2, 10 and 11 of the Act which states, in part, as follows:2. For the purposes of this Act—“appeal” means proceedings by way of application for the discharge or setting aside of a judgment or for a new trial or a stay of execution;10. Setting aside(1)Where a judgment has been registered under this Act an application may be made by the judgment debtor that the judgment be set aside on any of the grounds set out in subsection (2) or (3), and if the High Court is satisfied that any of those grounds has been established it shall set aside the registration of the judgment.(2)The grounds upon which a registered judgment may be set aside are that—--------(k)the judgment has been taken on appeal, and reversed or discharged or otherwise set aside, in a court of the country of the original court;-----------11. Effect of appeals, etc.(1)An application may be made by or on behalf of the judgment debtor to set aside the registration of a judgment on the ground that—(a)an appeal is pending against the judgment; or(b)he is entitled and intends to appeal against the judgment; or(c)the matter in relation to which the judgment was given is the same as that in respect of which proceedings, instituted prior to the institution of the proceedings in the original court, are pending in a court in Kenya.(2)Where the High Court is satisfied that the grounds specified in subsection (1)(a) or (b) are established, it may, on such terms as it thinks just, set aside the registration or adjourn the application until the expiration of such period as appears to the High Court to be reasonably sufficient to enable the proceedings, and any appeal therefrom to a competent tribunal, to be disposed of. [Emphasis mine]

9. The plaintiff’s case is that the pending application has no relationship with the judgment that has been registered and that it is not an appeal within the meaning of the Act hence the court should not set aside the registration. Counsel for the plaintiff submits that there is neither an appeal pending against the default judgment granted to the plaintiff in Mwanza Commercial Case No. 3 of 2014 nor an application to set it aside hence the application should be dismissed.

10. The defendant maintains that Civil Application No. 421/08 of 2021 pending before the Court of Appeal of the United Republic of Tanzania emanates and is related to Mwanza Commercial Case No. 3 of 2014. That the application is a pending appeal for purposes of the Act and that if the registration is not set aside, the pending application will be an academic exercise and it shall be rendered nugatory.

11. In order to set aside the registration, the Defendant must satisfy the court that there is an appeal pending against the judgment. As section 2 of the Act states, an appeal means proceedings by way of an application for the discharge or setting aside of a judgment or for a new trial or a stay of execution. In this case what is pending is not an appeal against the judgment in Mwanza Commercial Case No. 3 of 2014 or an application to discharge or set aside a judgment, it is an application for seeking extension of time in which to institute an appeal from the ruling and order dated 18th November 2018 in High Court Mwanza, Commercial Division, Misc. Commercial Application No. 323 of 2017.

12. While I accept that the pending application in the Court of Appeal of the United Republic of Tanganyika has a relationship with the judgment in Mwanza Commercial Case No. 3 of 2014, it is not an appeal or an application to set aside the judgment in that case within the meaning of the Act. The court is confined by the statutory language of section 2, 10 and 11 of the Act and that language is clear that the appeal or application must relate to the judgment. What the defendant has filed in the foreign court is a peripheral application. I also reject the any suggestion by the defendant that the court is dealing with the merits of the pending application. The court is merely applying the statutory language to the facts of the case.

13. I have come to the conclusion that the defendant’s application dated October 21, 2021must fail. It is dismissed with costs to the plaintiff.

DATED AND DELIVERED AT NAIROBI THIS 13TH DAY OF JUNE 2022. D. S. MAJANJAJUDGECourt Assistant: Mr. M. OnyangoMs Kitonga instructed by S. M. Kitonga and Company Advocates for the Plaintiff.Mr Kamwendwa instructed by N. M. Kamwendwa and Company Advocates for the Defendant.