https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/6846

Ngao Credit Ltd v Charo (Civil Appeal E1151 of 2025) [2026] KEHC 6846 (KLR) (Civ) (14 May 2026) (Ruling) Neutral citation: [2026] KEHC 6846 (KLR) Republic of Kenya In the High Court at Nairobi (Milimani Law Courts) Civil Civil Appeal E1151 of 2025 WA Okwany, J May 14, 2026 Between Ngao Credit Limited Appellant and Charles Kombe Charo Respondent Ruling Background 1.The Respondent sued the Applicant in Milimani CMCC No. 1566 of 2020. The case was heard on 5th September 2024 after which the Respondent closed his case and the matter set down for defence hearing. 2.Defence hearing did not proceed on several occasions owing to various reasons which the Applicant attributed to unavoidable circumstances including illness of witnesses, maternity leave of counsel, and absence or indisposition of counsel for the Respondent. 3.When the matter eventually came up for defence hearing on 30th October 2025, the Applicant sought an adjournment on grounds that his witness was on sick-leave and unable to attend court. The learned Magistrate however declined to grant the adjournment, dismissed the defence case, and directed parties to proceed by way of written submissions without hearing the Applicant’s evidence. 4.Aggrieved by the dismissal of its defence and apprehensive that judgment would be delivered without its evidence being heard, the Applicant lodged the present appeal and the accompanying application seeking stay of proceedings before the trial court. The Application 5.This ruling is in respect to the Appellant/Applicant’s Notice of Motion dated 18th November 2025 seeking principally orders for stay of proceedings in Milimani CMCC No. 1566 of 2020, Charles Kombe Charo vs. Ngao Credit Limited, pending the hearing and determination of the appeal herein. 6.The application is brought under Articles 50(1) and 159(2)(a), (d) and (e) of the Constitution of Kenya, Order 42 Rule 6 and Order 51 Rule 1 of the Civil Procedure Rules, Sections 1A, 1B and 3A of the Civil Procedure Act, the Appellate Jurisdiction Act, and all other enabling provisions of the law. 7.The Applicant further seeks orders that the proceedings before the lower court commence de novo with its participation. The application is supported by the affidavits of Celestine Kageha Osili and Abigail Mutua and the written submissions dated 18th February 2026. It is opposed through the Replying Affidavit sworn by the Respondent, Charles Kombe Charo. The Applicant’s Case 8.The Applicant contends that although the Respondent closed his case on 5th September 2024, the defence hearing failed to proceed on several occasions due to unavoidable circumstances, including illness of witnesses, maternity leave of counsel, and indisposition of counsel for the Respondent. 9.The Applicant avers that on 7th August 2025, counsel for the Applicant was present and ready to proceed with the hearing, but the matter was adjourned because counsel for the Respondent was unwell. 10.It is deposed that on 30th October 2025, the Applicant’s witness was on sick leave and therefore unable to attend court. Counsel sought an adjournment, but the learned Magistrate declined the request, dismissed the Applicant’s defence case, and directed parties to file submissions. 11.The Applicant further avers that following the exit of Miss Ojuok from employment on 31st October 2025, the matter was not properly handed over and that the proceedings of 30th October 2025 were omitted from the handover report. 12.The Applicant states that it only became aware of the dismissal upon being served with the Respondent’s submissions on 11th November 2025. 13.The Applicant additionally contends that upon obtaining typed proceedings, it was surprised to discover that the proceedings did not expressly indicate dismissal of the defence case or directions on filing submissions and that at one point the court file was missing. 14.The Applicant maintains that it has been denied the constitutional right to a fair hearing under Article 50(1) of the Constitution and that unless stay of proceedings is granted, the appeal shall be rendered nugatory because judgment may be delivered solely on the basis of the Respondent’s evidence. 15.It is further submitted that the Applicant has an arguable appeal raising serious constitutional and procedural questions regarding the denial of a hearing and the exercise of judicial discretion by the trial court. 16.The Applicant submits that the errors and inadvertence of previous counsel ought not to be visited upon an innocent litigant. The Applicant relied on several authorities and statutory provisions in support of its case. The Respondent’s Case 17.The Respondent contends that the application does not satisfy the mandatory requirements under Order 42 Rule 6 of the Civil Procedure Rules. 18.The Respondent argues that the Applicant failed to attach the order appealed from and further failed to attach its defence or pleadings before the lower court. 19.The Respondent further submits that the matters relating to internal handovers between advocates are irrelevant to the legal threshold for stay of proceedings. 20.According to the Respondent, the lower court record clearly demonstrates that the Applicant had repeatedly sought adjournments over an extended period and that the trial court exercised proper discretion in declining further adjournment. 21.The Respondent highlights at least four (4) instances when the case did not proceed as it was adjourned at the instance of the Applicant. He contends that the lower court properly exercised discretion after repeated adjournments and prolonged delay in a matter that had already been pending for several years. 22.The Respondent further avers that the Applicant indicated that it had no evidence when the adjournment was declined, and voluntarily closed its case, whereupon parties took a mention date for submissions by consent. 23.It is also the Respondent’s position that the Applicant was not denied a hearing because it had been accorded more than adequate opportunities to prosecute its defence. 24.The Respondent additionally contends that the affidavits sworn by Abigail Mutua constitute hearsay evidence because the deponent never attended the proceedings before the lower court. 25.The Respondent therefore submits that the intended appeal is frivolous, lacks merit, and does not satisfy the threshold for grant of stay of proceedings. Analysis and Determination 26.Having considered the application, affidavits, rival submissions, proceedings before the lower court, and the authorities cited, I find that the main issue for determination is whether the applicant has made out a case for the granting of orders for stay of proceedings. 27.The application is principally anchored on Order 42 Rule 6 of the Civil Procedure Rules which provides that:“No appeal or second appeal shall operate as a stay of execution or proceedings under a decree or order appealed from except in so far as the court appealed from may order…” 28.The Rule further requires demonstration of substantial loss and that the application be brought without unreasonable delay. 29.Article 50(1) of the Constitution which guarantees every person the right to a fair hearing. 30.Article 159(2)(d) of the Constitution further obligates courts to administer justice without undue regard to procedural technicalities. 31.The principles governing stay of proceedings were stated in Re Global Tours & Travel Ltd HCWC No. 43 of 2000, where Ringera J. stated:“As I understand the law, whether or not to grant a stay of proceedings or further proceedings on a decree or order appealed from is a matter of judicial discretion to be exercised in the interests of justice… the sole question is whether it is in the interest of justice to order stay of proceedings and if it is, on what terms it should be granted.” 32.The Court further stated that in exercising that discretion, the Court should consider:“…the need for expeditious disposal of cases, the prima facie merits of the intended appeal… the scarcity and optimum utilization of judicial time and whether the application has been brought expeditiously.” 33.The Applicant’s complaint is that the trial court dismissed its defence case without hearing it, thereby violating its constitutional right to fair hearing under Article 50(1) of the Constitution. 34.The Respondent, however, contends that the Applicant had repeatedly delayed the proceedings through multiple adjournments and that the learned Magistrate properly exercised discretion in declining a further adjournment. 35.A perusal of the record reveals that, indeed, several adjournments had been granted before the lower court. The question before this court, however, is not whether the trial court had discretion to refuse an adjournment but rather, whether the intended appeal raises arguable issues deserving preservation pending appeal. I am persuaded that it does. 36.In Butt vs. Rent Restriction Tribunal [1982] KLR 417 the Court of Appeal held:“The general principle is that where there is a right of appeal, the court ought to ensure that the appeal if successful is not rendered nugatory.” 37.Similarly, in Reliance Bank Ltd vs. Norlake Investments Ltd [2002] 1 EA 227, the Court held:“An appeal is rendered nugatory where the subject matter is destroyed or the situation created is irreversible.” 38.The Applicant argued that unless stay is granted, the lower court shall proceed to give a judgment solely on the Respondent’s evidence and the Applicant will have been permanently shut out from presenting its defence. That argument cannot be said to be frivolous. 39.In Safaricom Limited vs. Josenga Company Limited & 4 Others [2021] eKLR, the Court stated that the right to fair hearing is a principle of Natural Justice that cannot be limited and/or derogated from. The Court further emphasized that Article 50(1) guarantees the right to have any dispute that can be resolved by application of law decided in a fair and public hearing. 40.In this case the Applicant also explained the circumstances leading to the failure to proceed on 30th October 2025, including sickness of the witness and administrative lapses occasioned by transition of counsel. 41.Whether those reasons were sufficient to warrant adjournment is ultimately a matter to be determined at the hearing of the substantive appeal. However, at this stage, the Court is only required to determine whether the appeal is arguable and whether refusal of stay would occasion prejudice incapable of remedy. 42.The Court is alive to the principle that mistakes of counsel should not lightly be visited upon litigants. In Philip Chemwolo & Another vs. Augustine Kubende [1982–88] KAR 103, Apaloo JA famously stated:“Blunders will continue to be made from time to time and it does not follow that because a mistake has been made that a party should suffer the penalty of not having his case heard on its merits.” 43.Likewise, in Richard Ncharpi Leiyagu vs. IEBC & 2 Others [2013] eKLR, the Court of Appeal held that the right to a hearing has always been a well protected right in our Constitution and is also the cornerstone of the Rule of Law. The Court further stated that courts should lean towards sustaining rather than terminating proceedings. 44.The Respondent urged the Court to find that the Applicant had been granted numerous adjournments and was merely delaying the matter. 45.I have carefully considered that argument. Indeed, courts must guard against abuse of process and unnecessary delay in litigation. However, courts are equally enjoined to ensure that disputes are determined on their merits whenever possible. 46.In Raila Odinga vs. IEBC & Others [2013] eKLR the Supreme Court observed that Article 159(2)(d) of the Constitution simply means that a Court of law should not pay undue attention to procedural requirements at the expense of substantive justice. 47.In the present matter, I find that should the proceedings continue and judgment is delivered before the appeal is heard, the substratum of the appeal shall effectively be lost because the Applicant’s complaint is precisely that it was denied an opportunity to present its defence. 48.I am therefore satisfied that the Applicant has demonstrated sufficient cause for grant of stay of proceedings pending appeal. 49.I am also satisfied that the application was brought without unreasonable delay, having been filed shortly after the Applicant became aware of the dismissal of its defence case. 50.As regards the prayer that the matter commences de novo, that issue falls within the substantive appeal and cannot appropriately be determined at this interlocutory stage. Disposition 51.Accordingly, and having regard to the findings and observations that I have made in this ruling, I find that the instant application is merited and make the following final orders:a.The Notice of Motion dated 18th November 2025 is hereby allowed in part.b.There shall be a stay of proceedings in Milimani CMCC No. 1566 of 2020 pending the hearing and determination of this appeal.c.The prayer that the matter proceeds de novo is deferred to the hearing of the substantive appeal.d.The Applicant shall file and serve the Record of Appeal within forty-five (45) days from the date hereof.e.Costs of the application shall abide the outcome of the appeal. 52.It is so ordered. DATED, SIGNED AND DELIVERED AT NAIROBI THIS 14TH DAY OF MAY 2026.HON W. A. OKWANYJUDGEIn the presence ofMiss Osili for AppellantNo Appearance for RespondentAbdirzak - Court Assistant