https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/11502

# REPUBLIC OF KENYA **IN THE HIGH COURT OF KENYA AT NAIROBI MILIMANI LAW COURTS** **CIVIL APPEAL NO. E319 OF 2026** BAJRANG SINGH RATHORE T/A RAJLAXMI LIMITED APPELANT/APPLICANT -VERSUS- DITI ENGINEERING RESPONDENT (*Being an application for stay of execution of the judgement delivered by Honourable S. N. Njoki on 18th May 2026 in SCCCOMM/E786/2026.*) # RULING 1. Before the Court is an application dated 20th May 2026, by Bajrang Singh Rathore T/A Rajlaxmi Limited (the appellant/applicant), expressed to be brought pursuant to sections 1A, 1B, 3A of the Civil Procedure Act and Order 42 Rule 6 of the Civil Procedure Rules. The applicant seeks for orders: 1. That this application be certified urgent and service thereof be dispensed with *(Spent).* 2. That this Honourable Court be pleased to grant leave to the firm of Bryan Khaemba, Kamau Kamau & Company Advocates to come on record for the Appellant herein *(Spent).* 3. That pending the hearing and determination of this application, this Honourable Court be pleased to issue an Order of Stay of execution of the judgement in Milimani SCCCOMM/E736 of 2026 Diti Engineering versus Bajrang Singh Rathore T/A Rajlaxmi Limited, delivered 18th May 2026 together with any consequential decree and orders as arising therein. 4. That pending the hearing and determination of this appeal, this Honourable Court be pleased to issue an Order of Stay of execution of the judgement in Milimani SCCCOMM/E736 of 2026 Diti Engineering versus Bajrang Singh Rathore T/A Rajlaxmi Limited, delivered 18th May 2026 together with any consequential decree and orders as arising therein. 5. That the costs of the application be provided for. Diti Engineering is the respondent herein. 1. The matter originates from the respondent’s award of Kshs 1,000,000/- by the Small Claims court at Nairobi as a result of the appellant/applicant’s failure to fulfil their part of a contract for supply of goods. 2. The application is opposed by the Replying Affidavit sworn by Jayesh Mehta on 20th May 2026. Both parties filed submissions. # Applicant’s Submissions 1. In submissions dated 20th May 2026, the appellant/applicant states that Order 42 Rule 6 of the Civil Procedure Rules provides for the court’s discretion to grant stay pending appeal on condition that it is satisfied that; substantial loss may result to the applicant, furnishing of security and, the application is made without undue delay. 1. Relying on *Tropical Commodities Suppliers Limited & Others vs International Credit Bank Ltd (in liquidation) (2004) 2 E.A 331* the appellant/applicant submitted that substantial loss refers to any loss, great or small, that is of real worth or value as distinguished from a loss without value is a loss that is merely nominal. 2. The appellant/applicant submits that they stand to suffer substantial loss if the decretal sum is paid to the respondent. Further, that the respondent, who is a foreign entity incorporated in India, has failed to provide material demonstrating their financial ability to refund the decretal sum should the appeal succeed. 3. It is also submitted that the appellant/applicant is willing to furnish security. The applicant demonstrates that they have previously complied with a similar order of this Court on 24th May 2026 to deposit the sum of Kshs 200,000/- as security. 4. The application has also been made without undue delay as the judgement was delivered on 18th May 2026, and this application was filed on 20th May 2026. # Respondent’s submissions 1. In opposing the application, the respondent in submissions dated 2nd July 2026, contends that the appellant/applicant has failed to demonstrate substantial loss as required by Order 42 Rule 6(2) of the Civil Procedure Rules. The respondent cites *James Wangalwa & another v Agnes Naliaka Cheseto [2012] eKLR* where the court stated that 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. 1. The respondent contends that the appellant/applicant’s reliance on the respondent’s financial position to demonstrate substantial loss is not sufficient and it is founded on unsupported allegations. Relying on *Caneland Ltd & 2 others v Delphis Bank Ltd, Civil Application No. Nai. 344 of 1999;* and *Stephen Wanjohi v Central Glass Industries Ltd, Nairobi HCCC No. 6726 of 1991* the respondent emphasises that the applicant is the one to demonstrate that the decree holder would be unable to refund the decretal sum should the appeal succeed. 2. On the issue of security, the respondent submits the Kshs 200,000/- deposited to the Court is not sufficient as the order was granted at the interim stage for conditional stay. The respondent submits that the appellant/applicant ought to deposit the entire sum of Kshs 1,000,000 together with any accrued interests and costs into a joint interest-earning account in the names of both advocates on record, or deposit the same to Court. # Determination 1. Having considered the application, replying affidavit, parties’ submissions, the authorities cited, and the law, the issue for determination is whether a stay of execution pending appeal is merited. 2. Order 42 Rule 6(2) reads: # “No order for stay of execution shall be made under sub rule (1) **unless—** 1. **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** 2. **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.”** 3. Firstly, the record indicates that the impugned judgement was delivered on 18th May 2026. This application was promptly filed on 20th May 2026. The application is thus timely, and without undue delay. 4. The applicant also argued that they stand to suffer substantial loss if the decretal sum of Kshs 1,000,000/- is paid to the respondent because the respondent is a foreign entity, thus out of the jurisdiction of this court should the appeal succeed and recovery of the decretal sum is necessary. The respondent contended that the claim was unfounded and merely speculative of its financial capabilities. 5. While it is well established that execution of a money decree does not normally constitute substantial loss, this court ought to balance the interests of both parties in the interest of justice. 6. In *Ujagar Singh vs Runda Coffee Estates Limited [1966] EA 263*, the court invoked its jurisdiction and ordered the preservation of the status quo pending the hearing and determination of the appeal. The court observed: # “…It is not normal for a court to grant stay of execution in monetary decrees but where there are special features such as the issue or the regularity of the judgment, the fact that the amount payable under the decree being substantial and the fact that the plaintiff has no known assets within the jurisdiction from which the applicant can recoup in the event the appeal is successful…” 1. The fact that the respondent is a foreign entity incorporated out of the jurisdiction of this court is a relevant factor for assurance of ease of recovery of the decretal sum. To balance this concern, this court is mandated to exercise its discretion to mitigate any potential substantial loss by requiring furnishing of security. 2. On the issue of the amount as contended by the respondent, the purpose of Order 42 Rule 6(2)(b) is to secure the performance of the decree while ensuring that the respondent is not unfairly denied the assurance of availability of the fruits of their judgement. 3. Since the appellant/applicant has already demonstrated to this court that they are willing to comply, it is only fair for the full sum of Kshs 1,000,000/- to be deposited so that there can be an equitable balance for both parties. 4. Consequently, in the circumstances of this application, I make the following orders: 5. *The Notice of Motion dated 20th May 2026 is merited.* 6. *A stay of execution of the decree is granted pending determination of the appeal, on condition that the applicant deposits the balance of Kshs* *800,000 in addition to the already deposited Ksh 200,000/- to this court within thirty (30) days from the date of this ruling.* 1. *In default of compliance with the condition in order (ii) above, the stay of execution shall automatically lapse and the respondent shall be at liberty to proceed with execution of the decree.* 2. *Costs of the application to follow the appeal.* **DATED** and **DELIVERED** at **NAIROBI** this 23RD day of **JULY 202**6. ……………………….……………………………… # E.K. OGOLA JUDGE In the presence of: Bulowe holding brief for Khaemba for the Applicant. Wanjau for the Respondent. Gisielle Muthoni, Court Assistant.