[2021] KECA 1039 (KLR)

IN THE COURT OF APPEAL

AT NAIROBI

(CORAM: NAMBUYE, OKWENGU & MUSINGA JJ.A.)

CIVIL APPEAL (APPLICATION) NO. 36 OF 2020

BETWEEN

MOHAMED BULLE.......................................................................................APPLICANT

AND

RICHARD KIPKOECH AIYABEI...................................................1STRESPONDENT

AGRICULTURAL FINANCE CORPORATION............................2NDRESPONDENT

HON. BENJAMIN CHEMBOI..........................................................3RDRESPONDENT

HON. JOHN OK’OBADO.................................................................4THRESPONDENT

HON. HASSAN OSMAN...................................................................5THRESPONDENT

HON. MARTIN OGINDO.................................................................6THRESPONDENT

DR. GLADYS K. NGAO....................................................................7THRESPONDENT

MRS. TABITHA M. MAUGI.............................................................8THRESPONDENT

(Being an application for stay of execution pending appeal from the ruling and order of the

Employment and Labour Relations Court at Nairobi (Hon. H. Wasilwa, J.)

dated 8thApril 2020 inELRC Petition No. 46 of 2020)

RULING OF THE COURT

On 26th October 2020, the Notice of Motion dated 23rd July 2020 came before us for hearing and determination. The motion was brought under Rules 1(2)and5(2)(b)of the Court of Appeal Rules. The motion substantively sought orders that:

3. The execution of the ruling and orders of the Employment and Labour Relations Court at Nairobi (Hon. Justice Wasilwa) on the application dated 8thApril 2020 delivered on 16thJuly 2020 in Employment and Labour Relations Petition No. 46 of 2020 be andis hereby stayed pending the hearing and determination of the appeal therefrom.

4. Further proceedings in Employment and Labour Relations Petition No. 46 of 2020 be and is hereby stayed pending the hearing and determination of the appeal from the ruling and orders made by the Employment and Labour Relations Court on 16thJuly 2020 in regard to the application dated 8thApril, 2020.

5. That the 1strespondent bears the costs of this application and in the alternative that costs abide the outcome of the appeal.

The application was supported by grounds on its body and a supporting affidavit sworn by Mohamed Bulle, together with annextures thereto. The application was opposed by a replying affidavit sworn by the 1st respondent, Richard Kipkoech Aiyabei, on 29th September 2020 with no annextures thereto. The application was canvassed virtually through the rival pleadings of the parties, written submissions of the applicant, 1st respondent and the 2nd – 8th respondents, and legal authorities relied upon by the respective parties in support of their rival positions. The set for the applicant is dated 3rd August 2020 and 21st October 2020 respectively for both the main and further submissions. That for the 1st respondent is dated 29th September 2020, while those for the 2nd to 8th respondents are dated 17th August 2020.

On 26th October 2020 when the application came up for hearing before us, we heard the parties and granted interim orders as follows:-

“1. An interim order of stay of execution of the ruling and orders of the Employment and Labour Relations Court at Nairobi (Hon. H. Wasilwa, J.) on the application dated 8thApril 2020 delivered on 16thJuly 2020 in Employment and Labour Relations Petition No. 46 of 2020 be and is granted pending delivery of the ruling on the application dated 23rdApril 2020, scheduled for delivery on 18thDecember 2020.

2. An interim order of stay of proceedings in Employment and Labour Relations Petition No. 46 of 2020 be and is hereby granted pending delivery of the ruling on the application dated 23rdJuly 2020 scheduled for delivery on 18thDecember 2020.

3. Costs of the application to abide the outcome of the ruling on 18thDecember 2020. ”

We now give our ruling and the reasons for granting the interim orders.

The background to the application albeit in a summary form, is that on 21st April 2019, the 1st respondent applied for an extension of his contract of employment with the 2nd respondent for the position of Managing Director, which application upon consultation with the Cabinet Secretary of Agriculture, Livestock and Fisheries was approved and a contract for a period of one (1) year was entered into between the 1st respondent and the 2nd respondent, on the premise that the same would lapse on 31st March 2020, unless extended in terms of the terms of the contract contained therein. It was in the cause of the subsistence of the said contract that issues arose with regard to the 1st respondent’s discharge of his duties with the 2nd respondent, triggering the 1st respondent’s suspension from duty by the 2nd respondent’s Board of Directors. The aforementioned events also triggered criminal investigations into the same matter. On 21st March 2020, the 1st respondent acknowledging that his one-year employment contract with the 2nd respondent would lapse on 31st March 2020, applied for its extension which was declined by the 2nd respondent’s Board of Directors. It is the 2nd respondent’s Board of Directors refusal to accede to the 1st respondent’s request for the renewal of his contract of employment, that triggered the filing of Petition No. 46 of 2020 in the Employment and Labour Relations Court.

Simultaneously with the filing of the petition was filed a Notice of Motion dated 31st March 2020 seeking a temporary injunction against the 2nd respondent by itself, servants and agents, restraining it from interfering with the peaceful performance of the 1st respondent’s duties as the Managing Director of the 2nd respondent in accordance with the 1st respondent’s terms and conditions of employment in the contract that had been duly executed between them pending the hearing of the interim application in the first instance and the main petition in the second instance.

This is the application that was placed before Hon. H. Wasilwa, J. on 1st April 2020 resulting in an exparte interim order being granted in favour of the 1st respondent as prayed for. The order was accordingly extracted and served upon the 2nd respondent who failed to honour those orders citing inability to effectually implement them for the reason that, first, the 1st respondent’s contract of employment with them had lapsed on 31st March 2020 by sheer effluxion of time. Second, the position had already been filled by another person procedurally appointed in accordance with the governing regulations.

Aggrieved, the 1st respondent moved back to the same ELRC and filed an application dated 8th April 2020 seeking a break-in order and change of locks to his former physical office; an order citing the applicant and its officers for contempt of Court and committal to civil jail for a period of six (6) months for disobeying the orders issued ex parte on 1st April 2020; and lastly, that the Officer Commanding Central Police Division Nairobi to ensure compliance with the break-in order and maintain peace in the premises of the applicant. The application wasNRB Civil Application No. 36 of 2020 Reasons for the ruling delivered on 26thOctober 2020 4opposed by the applicant and the 2nd – 8th respondents through a preliminary objection and a replying affidavit.

During the pendency of the hearing of the above application, the applicant and the 2nd – 8th respondents filed an application dated 15th April 2020 seeking to set aside the orders issued ex parte on 1st April 2020. The said application and the one filed by the 1st respondent on 8th of April 2020 were placed before the learned Judge on 4th June 2020. The learned Judge declined to hear the applicant’s and 2nd – 8th respondents’ application of 15th June 2020 until they purged their contempt of disobedience to the Court’s orders issued ex parte on 1st April 2020. Instead, the learned Judge proceeded to hear the 1st respondent’s application of 8th April 2020 and issued the impugned orders of 16th July 2020 citing the applicant and the 2nd – 8th respondents for contempt and fixed the matter for 30th July 2020 for sentencing.

The applicant was aggrieved and timeously filed the notice of appeal dated 20th July 2020 intending to appeal against the whole of that decision. It is on the said notice of appeal that the application under consideration is anchored. They rely on the annexed memorandum of appeal to support their contention that the intended appeal is arguable. It is also their argument that the orders sought if not granted, the intended appeal will be rendered nugatory because the effect of execution of a committal order is irreversible. In their view they have satisfied the twin principle threshold for granting of the relief sought under Rule 5(2)(b) of the Rulesof this Court.

To buttress the above argument, they have relied on the cases of Trust Bank Limited & Another vs. Investech Bank Ltd & 3 Others [2000]eKLR; Ethics and Anti-Corruption Commission vs. Nicholas Mwenda Mtwaruchiu & 8 Others [2018]eKLR; Nyamodi Ochieng Nyamogo & Another vs. Kenya Posts & Telecommunications Corporation [1994]eKLR; National Bank of Kenya Limited & Another vs. Geoffrey Wahome Muotia [2016]eKLR;Kabale Tache Arero vs. Salome Munubi & 3 Others; Muhammad Swazuri Chairman National Land Commission & Another (Interested Parties) [2020]eKLRandJustus all on the principles that guide the Court in the exercise of its unfettered discretionary mandate under Rule 5(2)(b) of the Court of Appeal Rules, and to which we shall shortly revert to.

As already mentioned above, the applicant filed further submissions in which they have addressed the law on contempt proceedings which do not fall for consideration under Rule 5(2)(b) of the Court Rules. These touch on the merit of the intended appeal. We refrain from delving into them to avoid preempting the intended appeal or prejudicing the parties.

One of the conditional principles that guide the Court in the exercise of its unfettered discretionary mandate under the said rule is that when considering an application of this nature, 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. See the case of Damji Pragji Mandavia vs. Sara Lee Household & Body Care (K) Ltd Civil Application No. Nai 345 of 2004.

The 2nd - 8th respondents support the application. They adopt fully the background to the application as already set out above. It is their submissions that the facts as laid by the applicant meet the threshold for granting relief under the said rule. In support of the above submissions, they rely on the case ofGithunguri vs. Jimba Credit Corporation Ltd (No. 2) [1988]eKLR,Butt vs. Rent Restriction Tribunal [1979]eKLR,Dennis Mogambi Mang’are vs. Attorney General & 3 Others [2012]eKLR,Kenya Hotel Properties Limited vs. Willisden Investments Limited & 6 Others [2013]eKLR, National Water Conservation & Pipeline Corporation vs. Jayne Kanini Mwanza [2014]eKLR, also all on the principles that guide the Court in the exercise of its unfettered discretionary mandate under the said Rule. Also cited was case law touching on contempt of Court proceedings and effect of a fixed term of contract of employment which as we have already pointed out above do not fall for consideration in an application of this nature. We, therefore find no need to delve into them.

In opposition to the application, the 1st respondent both in his replying affidavit and written submissions stressed the need for the applicant to obey court orders issued on 1st April 2020 and 4th June 2020, which they do not dispute to have personal knowledge of; that court orders must be obeyed to preserve the dignity of the court; that this Court has a duty to protect the dignity and sanctity of court orders. It also has a duty to ensure that a party seeking an equitable remedy does so with clean hands.

Our invitation to intervene on behalf of the applicant has been invoked under Rule 1(2) and 5(2)(b) of the Court of Appeal Rules. Rule 1(2) enshrines the inherent jurisdiction of the Court. The principles that guide the invocation of this jurisdiction have now been crystalized by case law. See the case of Equity Bank Limited vs. West Link Mbo Limited [2013]eKLR;andBoard of Governors Moi High School, Kabarak & Another vs. Malcolm Bell [2013]eKLRfor the enunciation of the principles inter alia that “inherent power is the authority possessed by a Court implicitly without its being derived from the Constitution or Statute. Second, that inherent powers are endowments to the Court, such as will enable it to regulate its internal conduct to safeguard itself against contemptuous or disruptive intrusion from elsewhere, and to ensure that its mode or discharge of duty is conscionable, fair and just.”The principles that guide the exercise of the Court’s unfettered discretionary mandate under Rule 5(2)(b) of the Rules of this Court and which we fully adopt are as aptly crystalized by the Court in the case

In summary, an applicant seeking relief under Rule 5(2)(b) of the Rules of this Court which is the substantive provision for accessing the reliefs sought has to demonstrate that the intended appeal/appeal is arguable; and second that unless he/she is granted stay, the appeal/or intended appeal, if successful, will be rendered nugatory. See the case of Trust Bank Limited & Another vs. Investech Bank Ltd & 3 Others[supra]. It is the applicant’s contention that the threshold on the first prerequisite has been satisfied. He relies on the annexed memorandum of appeal raising a litany of fifteen (15) grounds of appeal.

The position in law is that an arguable appeal is not one that must necessarily succeed, but one which ought to be argued fully before the Court; one which is not frivolous. In our view, all the grounds listed in the memorandum of appeal are arguable notwithstanding that they may not ultimately succeed. Secondly, that it is sufficient if a single bona fide arguable ground is raised. There is nothing raised in the 1st respondent’s opposing documents to suggest that the grounds of appeal intended to be raised are not bona fide arguable issues especially, when they are based on the background to the application already highlighted above. In light of the above assessment and reasoning on this prerequisite, we are satisfied that the first prerequisite under Rule 5(2)(b) of the Rulesof the Court has been satisfied.

Turning to the proof of the second prerequisite under this rule, it is undisputed that the threatened action sought to be forestalled is committal to civil jail for alleged disobedience of the court orders issued on 8th April 2020. The position in law on this aspect of the application is that each case has to be considered on its own peculiar facts. See David Morton Silverstein vs. Atsango Chesoni [2001]eKLR. Secondly, this also depends on whether or not what is sought to be stayed, if allowed to happen, is reversible or if it is not reversible whether damages will be reasonable to compensate the party aggrieved. See the case of Reliance Bank Ltd vs. Norlake Investments Ltd [2002] 1 E. A 227.

In light of the above threshold, it is apparent to us that the application was anchored on threat of committal to civil jail for alleged contempt of Court orders, and we are in agreement that should an order of stay not be granted and a committal order is issued, the applicant would lose his right to liberty, and the period of such loss is irreversible once the order is executed. We therefore find that the second pre-requisite has also been satisfied.

It is for these reasons that we issued the interim orders of 26th October 2020, and now affirm the interim orders by issuing orders that:

(i) Further proceedings in Employment and Labour Relations Petition No. 46 of 2020 be and is hereby stayed pending the hearing and determination of the appeal from the ruling and orders made by the Employment and Labour Relations Court on 16thJuly 2020 in regard to the application dated 8thApril, 2020.

(ii) The execution of the ruling and orders of the Employment and Labour Relations Court at Nairobi (Hon. Justice Wasilwa) on the application dated 8thApril 2020 delivered on 16thJuly 2020 in Employment and Labour Relations Petition No. 46 of 2020 be and is hereby stayed pending the hearing and determination of the appeal therefrom.

(iii) Costs of the application to abide the outcome of the intended appeal.

DatedandDeliveredatNairobithis29thday of January, 2021.

R. N. NAMBUYE

JUDGE OF APPEAL

HANNAH OKWENGU

JUDGE OF APPEAL

D. K. MUSINGA

JUDGE OF APPEAL

I certify that this is a true copy of the original.

Signed

DEPUTY REGISTRAR

NRB Civil Application No. 36 of 2020 Reasons for the ruling delivered on 26thOctober 2020 10