[2022] KEHC 1543 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT

AT ELDORET

CIVIL APPEAL NO. E106 OF 2021

LEILEI KIPCHIRCHIR DANIEL.............. APPELLANT

VERSUS

SELVESTER BULEMI LUMETI.......1ST RESPONDENT

KATIKA ENTERPRISES LTD...........2ND RESPONDENT

(An appeal from the judgment of Hon.E. Kigen, Senior Resident Magistrate, Eldoret in CM CC No.605 of 2017 delivered on 30/7/2021)

RULING

1. By a Notice of Motion dated 27th August, 2021, the Applicant seeks the following orders;

1. Spent.

2. That the Honourable Court be pleased to extend time for lodging of a Memorandum of Appeal and Record of Appeal against the judgment of Hon. E.Kigen made on 30/7/2021 in Eldoret CMCC No. 605 of 2017.

3. That the Memorandum of Appeal dated 27th August, 2021 be deemed as properly filed.

4. That pending the hearing and determination of the application herein, there be stay of execution of the judgment made on 30/7/2021 in Eldoret CMCC 605 of 2017 and all subsequent orders entered against the Appellant/Applicant.

5. That pending the hearing and determination of the appeal interpartes, there be temporary stay of execution of the judgment made on 30/7/2021 in Eldoret CMCC 605 of 2017 and of all subsequent orders entered against the Appellant/Applicant emanating therefrom.

6. That pending the hearing and determination of the intended appeal the Applicant herein do avail security by way of Bank Guarantee from Diamond Trust Bank for the whole judgment sum of Kshs.189,275/=.

7. That the costs of and incidentals to this application abide the result of the appeal.

2. The application is premised on the grounds on the face thereof and the Supporting Affidavit of Lelei Kipchirchir Daniel sworn on 27th August, 2021. The Applicant’s case is that judgment was delivered in Eldoret CMCC No. 605 of 2017 on 30th July, 2021 and the Respondent was awarded General Damages - Ksh. 180,000/=, Special damages Kshs. 9,275/=, net award being Kshs. 189,275/- plus costs and interest. Being dissatisfied with the said Judgment, the Applicant instructed his Advocates on record to institute an Appeal against the said judgment. That the time period in which the Judgment dated 30th July, 2021 can be appealed according to statute is set to lapse on Sunday 29th July 2021 and unless stay of execution is granted the Applicant will suffer irreparable loss and damage.

3. The Applicant contends that the delay of one day herein in filing the appeal is not inordinate and that the same was occasioned by the fact that the decision to appeal was being deliberated on by the applicant when time lapsed.

4. The Applicant’s position is that the intended Appeal raises pertinent issues and has a high chance of success. The Applicant is apprehensive that the 1st Respondent, as Decree Holder, may proceed and levy execution. The Applicant avers that Respondent has not disclosed nor furnished the Court with any documentary evidence to prove his financial standing.

5. The Applicant’s insurer is ready, willing and able to furnish the Court with a Bank Guarantee issued by Diamond Trust bank as security to the court for the entire judgment sum of Kshs.189, 275/=.

The Response

6. The application was opposed vide a replying affidavit of Selvester Bulemi Lumeti, the 1st Respondent, sworn 13th September, 2021 in which he deposed that Order 42 Rule 6(2) of the Civil Procedure Rules 2010 provides that a party seeking orders for stay should demonstrate that they stand to suffer substantial loss, make the application for stay without undue delay and offer security for the due performance of the order that may be ultimately binding on the Applicant.

7. The 1st Respondent contends that although the judgment by the trial court was delivered on the 30th July 2021, the application herein was filed on the 27th August 2021. The 1st Respondent’s case is that the application for stay has been made late in the day and the Appellant has not advanced any justification whatsoever for the delay.

8. The 1st Respondent’s case is that while the Appellant contends that he will suffer substantial loss, he has not demonstrated the loss that he stands to suffer, or prejudice that will be occasioned if the stay orders are not granted. The 1st Respondent maintains that his Advocates on record have not threatened execution and there is no threat that the judgment sum will be beyond the Appellant's reach if the appeal is successful.

9. Further, the 1st Respondent contends that the fact that the process of execution has been put in motion or is likely to be put in motion does not amount to substantial loss, that even when execution has been launched and completed, even where property has been attached and sold, it does not amount to substantial loss.

10. The 1st Respondent denied the averments by the Applicant that his financial status is not known and averred that he is a successful farmer in western Kenya and therefore can comfortably refund the decretal sum in the event the appeal succeeds.

11. The 1st Respondent is apprehensive about the proposal by the Applicant to furnish security by way of a Bank Guarantee from Diamond Trust Bank for a sum of Kshs. 189,275/=. He contends that the said agreement having a limited lifespan has the potential of leaving him exposed should it expire without renewal and that he will not have security for costs pending determination of the intended appeal. The 1st Respondent maintains the position that should stay be grant the decretal sum plus costs of the suit should be deposited with court in a joint interesting earning account.

12. The 1st Respondent contends that the Appeal is maliciously made to deprive him of the fruits of his judgment yet he continues to suffer from indelible scars and injuries from the accident.

13. Parties agreed to canvass the application vide written submissions. The Applicant filed his written submissions on 4th October, 2021 whereas the Respondents did not file any.

Determination

14. I have carefully considered the application, the Supporting Affidavits, the grounds of opposition and the submissions filed as well as the authorities relied upon. From the foregoing, the following issues arise for determination:

a. Whether to extend time within which to file the appeal; and

b. Whether to grant the orders of stay

15. Section 79 G of the Civil Procedure Act provides that:

Every appeal from a subordinate court to the High Court shall be filed within a period of thirty days from the date of the decree or order appealed against, excluding from such period any time which the lower court may certify as having been requisite for the preparation and delivery to the appellant of a copy of the decree or order:

Provided that an appeal may be admitted out of time if the appellant satisfies the court that he had good and sufficient cause for not filing the appeal in time.

16. It is clear therefore that the decision whether or not to grant leave to appeal out of time or to admit an appeal out of time is an exercise of discretion of the court. The Court’s discretion being judicial must therefore be exercised on the basis of evidence and sound legal principles, with the burden of disclosing the material falling squarely on the supplicant for such orders. One of those judicial principles expressly provided for in the above provision is that the applicant must satisfy the Court that he has a good cause for doing so.

17. In First American Bank of Kenya Ltd vs Gulab P Shah & 2 Others Nairobi (Milimani) HCCC NO. 2255 of 2000 [2002] 1 EA 65 the Court set out the factors to be considered in deciding whether or not to grant such an application and these are; the length of the delay; the explanation if any for the delay; the merits of the contemplated action, whether the matter is arguable one, deserving a day in court or whether it is a frivolous one which would only result in the delay of the course of justice; and whether or not the Respondent can adequately be compensated in costs for any prejudice that he may suffer as a result of a favourable exercise of discretion in favour of the Applicant.

18. In Stanley Kangethe Kinyanjui vs. Tony Ketter & 5 Others [2013] eKLR the court held that:

“...On whether the appeal is arguable, it is sufficient if a single bonafide arguable ground of appeal is raised...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...”

19. In this case the Applicant contended that the delay in filing the appeal was due to inability to give instructions to lodge the appeal within the prescribed time due to having consultations with the insurer. That the Appellant’s Advocate on record was only able to file the Memorandum of Appeal and this instant application on Monday 30th August, 2021 whereas the timelines for filing the appeal lapsed on 29th August, 2021 which was unfortunately a Sunday and therefore the one-day delay in filing the same.

20. From the record it is clear that as at the time of filing the memorandum of appeal and the present application the stay of execution of 30 days had lapsed but the delay is not inordinate and sufficient reasons have been given for the same. One day delay is not inordinate and I therefore grant leave to the Applicant to file the appeal out of time. Consequently, let the Memorandum of Appeal already on record be deemed to have been properly filed.

21. As regards stay, the principles guiding the grant of a stay of execution pending appeal are well settled. These principles are provided under Order 42 rule 6(1) and (2) of the Civil Procedure Rules which provides as follows:

“(1) No appeal or second appeal shall operate as a stay of execution or proceeding 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.”

22. In the case Samvir Trustee Limited vs. Guardian Bank Limited Nairobi (Milimani) HCCC 795 of 1997 the court held that;

“Every party aggrieved with a decision of the High Court has a natural and undoubted right to seek the intervention of the Court of Appeal and the Court should not put unnecessary hindrance to the enjoyment and exercise of that right by the defendant.A stay would be overwhelming hindrance to the exercise of the discretionary powers of the court…The Court in considering whether to grant or refuse an application for stay is empowered to see whether there exist any special circumstances which can sway the discretion of the court in a particular manner. But the yardstick is for the court to balance or weigh the scales of justice by ensuring that an appeal is not rendered nugatory while at the same time ensuring that a successful party is not impeded from the enjoyment of the fruits of his judgement. It is a fundamental factor to bear in mind that, a successful party is prima facie entitled to the fruits of his judgement; hence the consequence of a judgement is that it has defined the rights of a party with definitive conclusion. The respondent is asserting that matured right against the applicant/defendant…For the applicant to obtain a stay of execution, it must satisfy the court that substantial loss would result if no stay is granted. It is not enough to merely put forward mere assertions of substantial loss, there must be empirical or documentary evidence to support such contention. It means the court will not consider assertions of substantial loss on the face value but the court in exercising its discretion would be guided by adequate and proper evidence of substantial loss…Whereas there is no doubt that the defendant is a bank, allegedly with substantial assets, the court is entitled to weigh the present and future circumstances which can destroy the substratum of the litigation…At the stage of the application for stay of execution pending appeal the court must ensure that parties fight it out on a level playing ground and on equal footing in an attempt to safeguard the rights and interests of both sides. The overriding objective of the court is to ensure the execution of one party’s right should not defeat or derogate the right of the other. The Court is therefore empowered to carry out a balancing exercise to ensure justice and fairness thrive within the corridors of the court. Justice requires the court to give an order of stay with certain conditions.”

23. In this case the Applicant’s contention is that he will not be able to recover the decretal sum from the 1st Respondent in the event the orders of stay are not granted. The Appellant’s position is that he was held to be 50% liable for the accident which forms the subject matter of the lower court suit that gave rise to this appeal and hopes to get no liability vide this appeal. The Applicant is apprehensive that he will suffer substantial loss if the decretal sum of Kshs. 189,275/= is paid to the 1st Respondent should the appeal succeed.

24. Further, it is submitted that the Respondent may not be able to refund the amounts awarded in event the same is paid and appeal succeeds. Where the allegation is that the Respondent will not be able to refund the decretal sum the burden is upon the Applicant to prove that the Respondent will not be able to refund to the applicant any sums paid in satisfaction of the decree. See Caneland Ltd. & 2 Others vs. Delphis Bank Ltd. Civil Application No. Nai. 344 of 1999.

25. The law, however appreciates that it may not be possible for the Applicant to know the Respondent’s financial means. The law is therefore that all an Applicant is reasonably be expected to do, is to swear, upon reasonable grounds, that the Respondent will not be in a position to refund the decretal sum if it is paid to him should the appeal succeed. The applicant is not expected to go into the bank accounts, if any, operated by the Respondent to see if there is any money there. The property a man has is a matter so peculiarly within his knowledge that an applicant may not reasonably be expected to know them. In those circumstances, the legal burden still remains on the applicant, but the evidential burden would then, in those circumstances, where the applicant has reasonable grounds which grounds must be disclosed in the application that the Respondent will not be in a position to refund the decretal sum if the appeal succeeds, have shifted to the Respondent to show that he would be in a position to refund the decretal sum. See Kenya Posts & Telecommunications Corporation vs. Paul Gachanga Ndarua Civil Application No. Nai. 367 of 2001.

26. Accordingly, while appreciating that the Applicant did not sufficiently disclose his basis for believing that the 1st Respondent would not refund the decretal sum, the Respondent did not respond on the aspect of his ability to refund the amount in event the appeal succeeds save mentioning in passing that he is a successful farmer in western Kenya and therefore can comfortably refund the decretal sum. Conversely, the Appellant does not contend that if compelled to pay the decretal sum they are likely to fold up. The Appellant proposes that he be allowed to give security of the entire decretal amount by way of bank guarantee.

27. An Applicant must satisfy the Court that the application was made without unreasonable delay. The Court noted that the impugned judgment was delivered on 30th July 2021, the Memorandum of Appeal was filed on 30th August, 2021and an application for stay was filed on 30th August, 2021. This Court finds that there was no inordinate delay in filing this Application.

28. As to whether the proposed appeal is arguable, I have looked at the Memorandum of Appeal in the light of the judgment of the trial court. The Applicant proposes to challenge both the quantum and the finding on liability. He contends that the trial court erred in assessing an award which was excessive and wholly erroneous estimate of the loss and damages suffered by the Respondent. In University of Nairobi V Ricatti Business of East Africa [2020] eKLR the Court of Appeal while citing the case of John Gitahi & Another V Pioneer Holding (A) Ltd and 2 Others Civil Application No, 124 of 2008 observed that;

“An arguable appeal is also not one which must necessarily succeed, but one which ought to be argued fully before court; one which is not frivolous.”

8. Plainly therefore, the appeal is arguable, bearing in mind that an arguable appeal is not necessarily an appeal that must ultimately succeed.

9. On the issue of security, the Applicant has averred that they are ready to provide security for the decretal sum. The law is that where the Applicant intends to exercise his undoubted right of appeal, and in the event that he is likely to succeed he should not be faced with a situation in which it would find itself unable to get back its money. Likewise, the Respondent who has judgment in his favour should not, if the Applicant were eventually to be unsuccessful in his intended appeal, find it difficult or impossible to realize the decree.

10. The Bank Guarantee given by Diamond Trust Bank and annexed to the Supporting Affidavit sworn by Leilei Kipchirchir Daniel may not specifically cover the 1st Respondent. However, the Court in fashioning the security is not necessarily bound by what is offered by an Applicant. In this case, the appeal is directed at the quantum of damages only. Since liability is not in dispute it must be appreciated that at the end of the day the Respondent will be entitled to some amount.

11. Having considered this instant application in its entirety, I hereby, grant prayer 1 to 5 of the application on condition that;

a. The Appellant herein deposits the entire decretal sum in a joint interest earning account in the names of the Advocates for the parties on record within thirty (30) days from the date of this ruling failing which the stay shall automatically lapse.

b. The costs of the application shall abide the Appeal.

DATED, SIGNED AND DELIVERED AT ELDORET ON THIS 15TH DAY OF MARCH, 2022

E.K. OGOLA

JUDGE