https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/1641

 **REPUBLIC OF KENYA** **IN THE EMPLOYMENT *&* LABOUR RELATIONS** **COURT OF KENYA AT KISUMU** **APPEAL NO. E050 OF 2025** PORT FLORENCE COMMUNITY HOSPITAL, KISUMU.....**APPELLANT** **VERSUS** CAREN CHEROTICH..............................…..........................**RESPONDENT** *(Being an Appeal against the judgment and decree of Hon. V. Adhiambo SRM in Kisumu MCC. ELRC No. E107 of 2024 delivered on the 24th day of June 2025)* **RULING** 1. The Appellant has moved the Court through the application dated 9th March 2026 seeking, principally, orders to vary, vacate and/or set aside the order issued on 15th December 2025 striking out the records of appeal in ELRC Appeals Nos. E050 of 2025 to E062 of 2025. The Appellant further seeks reinstatement of the said appeals for hearing and determination on their merits and an order of stay of execution pending the hearing and determination of the appeals. It also urges the Court to grant it costs. 2. The application is premised on the grounds on its face and is supported by the affidavit of Mr. Ambrose Nyangao, the Appellant’s Chief Executive Officer. He depones that the Appellant was unable to comply with this Court’s order of 13th November 2025 requiring the deposit of the decretal sum within thirty days due to financial constraints. According to the deponent, the Appellant has an arguable appeal with high chances of success, and unless the orders sought are granted, the appeal will be rendered nugatory. He further avers that the Respondent remains at liberty to execute the decree at any time, thereby exposing the Appellant to substantial loss. The deponent asserts that the Appellant is willing to comply with any conditions the Court may impose for the due performance of the decree. He explains that the failure to deposit the decretal sum was not borne out of unwillingness to obey the Court’s orders but was occasioned by financial incapacity, given that the cumulative decretal amount in the twelve appeals stands at Kshs. 6,201,452.24. On that basis, he urges the Court to allow the application in the interests of justice and to avert loss that would not be adequately compensated by an award of damages. 3. The application is opposed. In a replying affidavit sworn on 27th March 2026, the Respondent contends that the Court properly exercised its discretion in striking out the appeals following the Appellant’s failure to comply with the conditional order requiring deposit of the decretal sum. She asserts that the Appellant has not offered any satisfactory explanation for its non-compliance and that its conduct demonstrates deliberate disregard of the Court’s orders. The Respondent further avers that the Appellant has failed to satisfy any of the legal grounds for review, having neither demonstrated the discovery of new and important evidence nor identified any error apparent on the face of the record. She disputes the claim of financial hardship, contending that the Appellant’s director and principal shareholder is a Member of Parliament pursuing gubernatorial ambitions and has already embarked on campaigns that require considerable financial resources. She further depones that the Appellant owns several private hospitals and hotels and was therefore capable of raising the requisite security. In her view, equity aids the vigilant and not the indolent, and allowing the application would unjustly deprive her of the fruits of her judgment. She also argues that the application, having been filed nearly four months after the impugned ruling, is an abuse of the court process and ought to be dismissed with costs. 4. The application was canvassed by way of written submissions. Appellant’s Submissions 1. The Appellant submits that its failure to deposit the decretal sum was solely attributable to financial constraints, a fact it had communicated to its previous advocates, who nevertheless failed to move the Court for variation, vacation or setting aside of the order. It contends that this constitutes sufficient cause for review under Rule 33 of the Employment and Labour Relations Court Rules, particularly because compliance with the order would severely impair its operations. The Appellant therefore urges the Court to permit it to furnish a bank guarantee in lieu of a cash deposit and relies on the case of **Muthui *v* Kasivu (Civil Appeal E268 of 2023) [2024] KESC 9627 (KLR)**, where a bank guarantee was accepted as an alternative form of security. The Appellant further asserts that this Court possesses inherent jurisdiction to vary, set aside or vacate its orders where the interests of justice so demand. In support of this proposition, it cites the decision in **Bilha Ngonyo Isaac *v* Kembu Farm Ltd *&* another [2018] KEHC 4729 (KLR)**, which adopted the principles in **Shah *v* Mbogo *&* another [1967] EA 116**, to the effect that judicial discretion should be exercised to prevent injustice or hardship resulting from inadvertence, excusable mistake or error, but not to aid a litigant who has deliberately sought to obstruct or delay the course of justice. On that basis, the Appellant maintains that its financial incapacity amounts to sufficient cause warranting the exercise of the Court’s discretion in its favour. 2. Regarding reinstatement of the appeals, the Appellant submits that its non-compliance stemmed from financial difficulties rather than any unwillingness to prosecute the appeals. It contends that its conduct demonstrates a genuine desire to pursue the appeals, as evinced by its efforts to communicate its financial position to the Respondent and its proposal to provide alternative security. It relies on the decision in the case of **Bartik *&* 3 others *v* Aduda *&* 2 others (Civil Case E002 of 2024) [2025] КЕНС 12025 (KLR)** which in citing **Philip Chemwolo *&* another *v* Augustine Kubende [1982-88] KAR 103**, acknowledged that blunders will continue to be made from time to time, however such blunders should not deprive a litigant of the opportunity to have a matter determined on its merits. 3. The Appellant further relies on the case of **Richard Ncharpi Leiyagu *v* Independent Electoral Boundaries Commission *&* 2 others [2013] KECA 282 (KLR)**, where it was held: *"For the aforesaid reasons the learned Judge was clearly wrong in the exercise of his discretion which resulted in an injustice, the petition could have proceeded for hearing within the same time frame. The appellant was denied a hearing; we have no choice but to allow this appeal as disallowing the appeal would go against the spirit of the overriding objectives and also the provisions of Article 159 of the Constitution."* 1. As regards stay of execution, the Appellant submits that it is entitled to the same in line with Rule 21 of the Employment and Labour Relations Court Rules and Order 42 Rule 6 of the Civil Procedure Act. On substantial loss it emphasizes that depositing the princely sum of Kshs 6,201,452.78 will cripple its operations. It relies on the case of **Njoroge *&* another *v* Malweyi *&* another (Civil Appeal E243 of 2024) [2024] KЕНС 16207 (KLR)** which in reference to the decision in the case of **James Wangalwa *&* another *v* Agnes Naliaka Cheseto [2012] eKLR** held: *"No doubt in law, the fact that the process of execution has been put in motion, or is likely to be put in motion, by itself, does not amount to substantial loss. Even when execution has been levied and completed, that is to say, the attached properties have been sold, as is the case here does not in itself amount to substantial loss under Order 42 Rule 6 of the CPR. This is so because execution is a lawful process. The applicant must establish other factors which show that the execution will create a state of affairs that will irreparably affect or negate the very essential core of the applicant as the successful party in the appeal...the issue of substantial loss is the cornerstone of both jurisdictions. Substantial loss is what has to be prevented by preserving the* status quo *because such loss would render the appeal nugatory."* 1. The Appellant further contends that unless stay is granted, the appeal will be rendered nugatory since the Respondent has not demonstrated her ability to refund the decretal sum should the appeal ultimately succeed. As to the issue of unreasonable delay, the Appellant submits that the period of almost three months was occasioned by a change of advocates, necessitated by the previous advocates’ failure to act on instructions, coupled with the closure of offices for Christmas. It maintains that its current advocates came on record on 5th March 2026 and filed the present application shortly thereafter on 10th March 2026. Consequently, it argues that there was no unreasonable delay. 2. On security for the due performance of the decree, the Appellant submits that the nature and form of security remain matters within the Court’s discretion. It therefore avers that a bank guarantee would sufficiently protect the Respondent’s interests while preserving its right of appeal. In support, it relies on the decision in the case of **Samvir Trustee Limited *v* Guardian Bank Limited [2007] eKLR**, where the Court emphasized the need to balance the competing interests of an appellant seeking to preserve an appeal and a successful litigant entitled to enjoy the fruits of a judgment. The Appellant accordingly urges the Court to allow the application. Respondent’s Submissions 1. The Respondent submits that the application is devoid of merit and fails to meet the legal threshold for review under Rule 74 of the Employment and Labour Relations Court (Procedure) Rules, 2024, section 80 of the Civil Procedure Act and Order 45 Rule 1 of the Civil Procedure Rules. She asserts that the Appellant has neither demonstrated the discovery of new and important evidence, nor identified any error apparent on the face of the record, nor established any other sufficient reason to warrant review. Reliance is placed on the decision in the case of **National Bank of Kenya Limited *v* Ndungu Njau [1997] eKLR**, where the Court held that review is available only to correct an obvious error or omission and cannot be used to challenge a court’s interpretation of the law or to re-open issues that have already been determined. 2. The Respondent further submits that the order requiring the Applicant to deposit the decretal sum was a conditional and time-bound order whose compliance was mandatory. Citing the case of **MM Butt *v* The Rent Restriction Tribunal [1979] eKLR**, the Respondent asserts that the power to grant stay is discretionary and may be exercised subject to conditions deemed just by the court. Once imposed, such conditions become binding obligations and failure to comply disentitles a party from equitable relief. The Respondent maintains that the requirement for security was not a procedural formality but a fundamental mandatory condition. Reliance is placed on the case of **Focin Motorcycle Co. Limited *v* Ann Wambui Wangui *&* another [2018] eKLR**, where the Court emphasized that security furnished under Order 42 Rule 6 must be capable of securing the due performance of the decree. The Respondent also cites the decision in the case of **Halai *&* another *v* Thornton *&* Turpin (1963) Ltd [1990] KLR 365**, in which the Court held that provision of security is a fundamental requirement for the grant of stay. 3. The Respondent further submits that compliance with court orders is mandatory. She cites the decision in the case of **Nicholas Kiptoo Arap Korir Salat *v* Independent Electoral and Boundaries Commission *&* 7 others [2014] KECA 782 (KLR)**, where the Supreme Court emphasized that parties must comply with court orders and procedural rules. The Respondent also cites the case of **Raila Odinga *&* others *v* IEBC *&* others [2013] eKLR** for the proposition that court orders are not issued in vain and must be obeyed to uphold the rule of law. She therefore maintains that the Appellant’s failure to comply with the conditional order demonstrates indolence, disregard of court orders, and lack of good faith. 4. With regard to the court’s discretion to set aside orders, the Respondent reiterates that the Appellant has not met the threshold for review. Additionally, she submits that the Applicant neither explained its failure to comply with the court’s orders nor sought extension of time or variation of the orders before the lapse of the prescribed period. Consequently, she asserts that the Appellant is not deserving of the court’s discretion. She relies on **Mbogo *&* another *v* Shah [1968] EA 116 at 123B**, in which the court emphasized that judicial discretion is intended to prevent injustice from accident, inadvertence, or excusable mistake, but not to assist a litigant who has deliberately sought to obstruct or delay the course of justice. 5. With respect to stay of execution the Respondent submits that the Appellant has not met the conditions thereof. On substantial loss the Respondent asserts that audited accounts, bank statements, financial reports, cash flow statements, or other documentary evidence have not been produced to show that the Appellant’s operations will be crippled if it deposits the entire decretal amount in court. In support of this position, she cites the case of **Kenya Shell Limited *v* Benjamin Karuga Kibiru *&* another [1986] KLR 410**, where the Court held that an applicant must provide evidence of substantial loss and that, absent such evidence, it would be rare for an appeal to be rendered nugatory. The Respondent also cites the case of **Machira T/A Machira *&* Co. Advocates *v* East African Standard (No. 2) [2002] KLR 63**, where it was held: *"To be obsessed with the protection of an appellant or intending appellant in total disregard or flitting mention of the so far successful opposite party is to flirt with one party as crocodile tears are shed for another contrary to sound principle for the exercise of a judicial discretion."* 1. Additional reliance is placed on the decision in the case of **Samvir Trustee Limited *v* Guardian Bank Limited [2007] eKLR** for the argument that a successful litigant is *prima facie* entitled to enjoy the fruits of judgment and should not be kept from doing so on the basis of speculative assertions. Concerning the delay in filing the application, the Respondent submits that period of nearly 3 months from 15th December 2025 to 10th March 2026 is inordinate, unreasonable and inexcusable. She asserts that the explanations advanced, namely change of advocates and the Christmas holiday period, do not constitute sufficient cause in law. It is her contention that the mistakes or indolence of the Appellant’s counsel should not be visited on her. Reliance is placed on the case of **Savings and Loan Limited v Susan Wanjiru Muritu Nairobi HCCC No. 397 of 2002 (unreported)** where the court held: *"It is not enough simply to accuse the advocate of failure to inform as if there is no duty on the client to pursue his matter."* 1. On the issue of security, the Respondent submits that the Appellant has not demonstrated the terms, validity, enforceability or duration of the alleged bank guarantee. She asserts that the Appellant cannot seek to vary express court orders through promises unsupported by evidence, and the Appellant cannot seek to renegotiate terms merely because compliance has become inconvenient. Accordingly, the Respondent urges the Court to dismiss the application with costs, uphold the Ruling striking out the appeals, and allow the Respondent to proceed with execution. Disposition 1. The issue for determination is singular. Has the Appellant/Applicant made out a case for the grant of the orders sought? It is common ground that the Appellant preferred Appeal Nos. E050 of 2025, E051 of 2025, E053 of 2025, E054 of 2025, E055 of 2025, E056 of 2025, E057 of 2025, E058 of 2025, E059 of 2025, E060 of 2025, E061 of 2025 and E062 of 2025 all between the Appellant and 11 Respondents including the present Respondent. In the Appeals, applications had been preferred seeking stay of execution pending hearing of the appeals which applications were granted. The condition granted was that the Appellant was to deposit the entire decretal sums within 30 days of 15th December 2025. 2. It is common ground there was no deposit of the decretal sums as ordered by the Court. The Appellant has now moved the Court vide the notice of motion application dated 9th March 2026 seeking, principally, orders to vary, vacate and/or set aside the order issued on 15th December 2025 striking out the records of appeal. 3. The factors a Court has to consider in setting aside are well settled. In the present scenario, like in all applications to set aside, the court has unfettered discretion in determining whether or not to set aside the orders issued. The Court must of necessity take into account such factors as the reasons given for non-compliance by the Appellant. The discretion is not absolute, nor is it an open cheque to be wielded arbitrarily as it is fettered. In the exercise of judicial discretion, just like in any instances where the Court must exercise judicial discretion, it must do so on fixed principles and not on sympathy, benevolence, sentiments or private opinions. The discretion is only to be exercised in only the most deserving of cases. It must never be displayed or given arbitrarily, whimsically or capriciously. The Court’s discretion being judicial must therefore be exercised on the basis of evidence and sound legal principles as enunciated in a plethora of cases cited herein. 4. In the case of **Savings and Loans Limited *v* Susan Wanjiru Muritu Nairobi (Milimani) HCCS No. 397 of 2002** (unreported) Kimaru J. (as he then was) expressed himself thus: *"Whereas it would constitute a valid excuse for the Defendant to claim that she had been let down by her former Advocates failure to attend Court on the date the application was fixed for hearing, it is trite that a case belongs to a litigant and not to her advocate. A litigant has a duty to pursue the prosecution of his or her case. The court cannot set aside dismissal of a suit on the sole ground of a mistake by counsel of the litigant on account of such advocate's failure to attend court. It is the duty of the litigant to constantly check with her advocate the progress of her case. In the present case, it is apparent that if the defendant had been a diligent litigant, she would have been aware of the dismissal of her previous application for want of prosecution soon after the said dismissal. For the defendant to be prompted to action by the plaintiff's determination to execute the decree issued in its favour is an indictment on the defendant. She had been indolent and taking into account her last conduct in the prosecution of the application to set aside the default judgment that was dismissed by the court, it would be a travesty of justice for the court to exercise its discretion in favour of such a litigant."* [Emphasis supplied] 1. The law is that though a court has a wide discretion in setting aside default judgements that discretion should be exercised judicially having regard to the particular circumstances of each case since the rules of the court must, *prima facie*, be obeyed, and in order to justify a court in exercising its discretion in favour of a party who has failed to comply with the set timelines during which some step in procedure requires to be taken, there must be material on which the court can exercise its discretion, otherwise a party in breach would have an unqualified right to an extension of time which would defeat the purpose of the rules which is to provide a timetable for the conduct of litigation. 2. The Court would be failing in the delivery of justice by allowing the Appellant run roughshod over the procedural requirements inherent in stay orders as issued to it. The Appellant ought to have moved Court immediately, if it felt it had no capability to comply with the stay order issued and not merely wait until things hit fever pitch before moving to Court close to 3 months later. 3. In every case that appears before the courts, there are two sides and, on this score, the justice of the case lies in disallowing the motion by the Appellant as to grant the said motion would be sanctioning indolence. No evidence of financial inability was displayed and an affiant cannot be said to have availed sufficient reason to set aside absent such evidence to compel a Court to come to the determination that indeed there are financial constraints in meeting the judgment. As there is no basis to interfere with the dismissal order issued herein, the application dated 9th March 2026 seeking, principally, orders to vary, vacate and/or set aside the order issued on 15th December 2025 striking out the records of appeal – be and is hereby dismissed with costs to the Respondents for being unmerited. The Respondents may proceed to execute the decrees subject of Appeal Nos. E050 of 2025, E051 of 2025, E052 of 2025, E053 of 2025, E054 of 2025, E055 of 2025, E056 of 2025, E057 of 2025, E058 of 2025, E059 of 2025, E060 of 2025, E061 of 2025 and E062 of 2025. It is so ordered. **Dated and delivered at Kisumu this 17th day of June 2026** **Nzioki wa Makau, MCIArb.** **JUDGE**