[2022] KEHC 1732 (KLR)

REPUBLIC OF KENYA

HIGH COURT OF KENYA AT KERICHO

CIVIL APPEAL NO. E032 OF 2021

PASCAL OTIENO AMOKE..................................................APPELLANT/APPLICANT

- V E R S U S -

COLLINS OMONDI OMOLLO................................................................RESPONDENT

R U L I N G

1. The Application coming for consideration in this Ruling is dated 7/1/2022 seeking stay of execution of the judgment delivered on 24/11/2021 in Kericho CMCC E25 of 2020 pending hearing and determination of Appeal No.32 of 2021.

2. The Applicant further seeks Orders that the Applicant provides Security in the form of a Bank guarantee for the full decretal sum of Kshs.298,703/= pending the hearing and determination of the said Appeal.

3. The Application is supported by the Affidavit of the Applicant dated 7/1/2022 in which the applicant has deposed as follows.

4. The Applicant is the owner of the motor vehicle registration number KCS 022Q which forms the subject of the case.

5. The Applicant averred that he was advised that an ex parte judgment against him was issued on 24/11/2021 vide Kericho CMCC E025 of 2020 for a sum of Kshs. 298,703 plus costs and interest.

6. The Applicant further averred that the Respondent wrote him a letter demanding for payment of the decretal sums thus exposing him to the risk of execution proceedings.

7. The Applicant averred that he has lodged an appeal vide Kericho HCCA No. 32 of 2021against the trial court’s decision reverting interlocutory judgment against him and that should execution proceedings be levied against him, the appeal would be rendered nugatory.

8. The Applicant was cognizant of the fact that an appeal does not operate as stay as such his movable properties were exposed to execution and subsequent sale, there was an imminent threat of execution so long as there was no stay of execution in force.

9. The Applicant further averred that the appeal filed against the trial court’s ruling has high chances of success as the trial court had prematurely dismissed his application without offering him an opportunity to be heard on merit.

10. The Applicant further averred that he and his insurers were willing and able to furnish security pending hearing and determination of the appeal; by providing a bank guarantee for the decretal sum of Kshs. 298,703.

11. The Applicant averred that the Respondent was a man of straw and will not be able to refund the decretal sums should the appeal succeed.

12. The Respondent opposed the Application and filed a Replying Affidavit dated 20/1/2022 in which he deposed as follows.

13. The Respondent averred that he instituted the suit in 29/9/2020 seeking for compensation of injuries he sustained as a result of a road traffic accident which occurred on 3/3/2020, he attended court, gave evidence and the court entered judgment in his favour which was yet tp be honored by the Applicant.

14. The Respondent averred that the application for stay of execution pending appeal was made in bad faith, lacked merit, was baseless, inept, an afterthought, amounted to an abuse of court process and was tailor-made to delay and/or deny him the rightful fruits of judgment.

15. The Respondent also averred that the memorandum of appeal attached to the instant application for stay of execution lacks merit and has no chances of success.

16. The Respondent sought to have the application for stay dismissed with costs. In the alternative if the Court were so inclined to grant stay, the stay should be granted on condition that the judgment sum of Kshs. 298,703 be deposited in court pending hearing and determination of the appeal and as such the baseless allegation by the Applicant that the Respondent is a “man of straw” should be disregarded as the security is to be deposited in court.

17. The parties filed written submission which I have duly considered.

18. The Applicant submitted that he was denied the right to have his case heard in an impartial manner and to be represented by an advocate of his choice, as a result judgment was delivered in favour of the Respondent, therefore exposing the Applicant to execution proceedings. The Applicant argued that had he been granted the opportunity to defend the case on merit, perhaps the judgment would have been mitigated given the nature of the injuries in question which were soft tissue injuries.

19. The Applicant submitted that the Respondent had not filed any documents to prove his financial standing or shown to the court any property they own which could be used to satisfy the decretal sum should the appeal succeed. The Applicant cited the case of Amal Hauliers Limited vs. Abdulnasir Abukar Hassan [2017] eKLR

20. The Applicant submitted that the instant application had been filed without unreasonable delay, that immediately following the impugned ruling delivered on 22/9/2021, the Applicant immediately filed for stay of proceedings and the instant application for stay of execution.

21. The Applicant submitted that based on the grounds set out on the memorandum of appeal filed, he has a good and arguable appeal with a high chance of success.

22. The Applicant submitted that as a measure to safeguard due performance of the decree herein, the Applicant was willing to furnish security by providing a bank guarantee for the full decretal sum pending hearing and determination of the appeal.

23. The Applicant further submitted that the appeal raises substantive issues of law and that the Applicant had satisfied the conditions set out by the law on stay of execution, which orders if not granted and the Respondent proceeds to execute judgment against the Applicant, the appeal would be rendered nugatory and the Applicant would suffer irreparable loss and damage.

24. The Respondent submitted that the onus of proving substantial loss and/or damage lay with the Applicant, the Applicant had not established whether any substantial loss would be suffered and/or the nature of the substantial loss to be suffered in the event the Court declined to issue orders for stay. The Respondent submitted that he was being denied the fruits of his judgment.

25. The Respondent submitted that the issue of financial standing would not arise if the Court were inclined to grant the orders sought, the Court should direct to have the decretal amount deposited in Court.

26. The Respondent contended that the funds would be secure in Court and not dependent on contracts entered into with a third parties, as the nature of security (bank guarantee) proposed by the Applicant involved contracts with third parties and was valid for twelve (12) months and there was a likelihood that appeal would take longer than the twelve (12) months thus rendering the security insufficient.

27. The Respondent further submitted that the memorandum of appeal lacked merit and the appeal has no chances of success. The Respondent was opposed to the Applicant’s contention that he was denied the right to be heard at trial, the Respondent stated that the Applicant was given ample opportunities to be heard at the trial.

28. The issues for determination in the application dated 7/1/2022 are as follows:-

(i) Whether the Applicant will suffer substantial loss unless the order of stay is granted.

(ii) Whether the application has been made without unreasonable delay.

(iii) Whether the Bank Guarantee the applicant is offering is sufficient security for the due performance of the decree

29. The provision governing stay of execution pending appeal is Order 42 Rule 6 (1) and (2) of the Civil Procedure Rules which provides as follows:-

[Order 42, rule 6. ]

"(1) 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 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 sub rule (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.

30. In ANTOINE NDIAYE VS. AFRICAN VIRTUAL UNIVERSITY [2015] eKLR Gikonyo J. stated as follows;

“The relief of stay of execution pending appeal is governed by Order 42 Rule 6 of the Civil Procedure Rules. The relief is discretionary although, as it has been said often, the discretion must be exercised judicially, that is to say, judiciously and upon defined principles of law; not capriciously or whimsically. Therefore, stay of execution should only be granted where sufficient cause has been shown by the Applicant. And in determining whether sufficient cause has been shown, the court should be guided by the three prerequisites provided under Order 42 Rule 6 of the Civil Procedure Rules, that: (a) The application is brought without undue delay; (b) The court is satisfied that substantial loss may result to the Applicant unless stay of execution is ordered; and (c) 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”.

31. On the issue of security I have considered several authorities.

32. In ARUN C. SHARMA VS. ASHANA RAIKUNDALIA T/A/RAIRUNDALIA &CO.ADVOCATES & 2 ORS [2014] eKLR, the court stated: “The purpose of the security needed under Order 42 is to guarantee the due performance of such decree or order as may ultimately be binding on the applicant. It is not to punish the judgment debtor…”

33. In FOCIN MOTORCYCLE CO. LIMITED VS. ANN WAMBUI WANGUI & ANOR [2018] eKLR, it was stated that: “Where the applicant proposes to provide security as the Applicant has done, it is a mark of good faith that the application for stay is not just meant to deny the respondent the fruits of judgment. My view is that it is sufficient for the applicant to state that he is ready to provide security or to propose the kind of security but it is the discretion of the Court to determine the security. The Applicant has offered to provide security and has therefore satisfied this ground for stay.”

34. From the above decisions, it is clear that the issue of security is discretionary and it is upon the court to determine the same. I hereby grant stay of execution pending appeal on the following conditions:-

(i) THAT the Applicant deposits the full decretal sum in an interest earning account held jointly by the Applicant’s and the Respondent’s Advocates within sixty (60) days of this date.

(ii) THAT failure to meet the above stated condition, the Respondent be at liberty to execute.

35. This ruling to abide in High Court Civil Appeal No.E033 of 2021.

DELIVERED, DATED AND SIGNED AT KERICHO THIS 4TH DAY OF MARCH, 2022.

A. N. ONGERI

JUDGE