[2018] KEHC 4998 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA

AT MACHAKOS

CIVIL APPEAL NO. 5 OF 2018

SAMUEL WATUKA MUINDI.................APPELLANT

VERSUS

JAYESH VIJAY PATEL........................RESPONDENT

RULING

1. By a Motion on Notice dated 28th February, 2018, the applicant/appellant herein, Samuel Watuka Muindi, substantially seeks an order that pending the hearing and determination of this appeal there be a stay of judgement and decree issued in Mavoko PMCC No. 582 of 2016.

2. According to the applicant judgement was entered against the defendants in the said suit jointly and severally in the sum of Kshs 3 million and it is that judgement that has provoked this appeal which in his view has high chances of success.

3. It was deposed by the applicant that unless execution of the said decision is stayed, he decree holder shall execute the same, an action that is likely to render this appeal nugatory. It was further deposed that this application was filed timeously and without unreasonable delay and that the grant of the orders sought herein will not prejudice the decree holder as the application is not intended to delay or frustrate the decree holder from realising the fruits of the judgement.

4. It was the applicant’s apprehension that unless the orders sought herein are granted he would suffer irreparable loss and damage as the respondent may not be in a position to reimburse the loss incurred.

5. The application was however opposed by the Respondent who relied on the following grounds of opposition:

(1) There is no notice/memorandum of appeal which has been filed or served upon the Respondent or his counsel.

(2) The application is an abuse of court process as there has been an unreasonable delay of more than three months by the Appellant in filing this application.

(3) The Appellant has not shown any substantial loss that may be occasioned.

(4) The Appellant has not deposited any security before this Court.

6. Apart from the said grounds the applicant also filed a replying affidavit in which he deposed that though the date of the delivery of the judgement was known to the applicant, the applicant did not turn up in order to seek stay of execution.

7. It was the Respondent’s case that the time for filing an appeal had in any case expired on 2nd December, 2017 hence the application for stay of execution was incompetent as there is no appeal. It was further deposed that the application was made after an inordinate delay of unexplained three months and that the applicant had not demonstrated that any substantial would be occasioned if the execution ensued and that he had not tendered any security before this Court.

8. To the Respondent, the applicant’s application was an attempt to defeat the ends of justice by filing this frivolous and vexatious application.

9. Based on the same ground that he appeal was filed outside the prescribed time, the Respondent filed an application dated 14th March, 2018 seeking that the Memorandum of Appeal dated 22nd January, 2018 be struck out.

10. To the application by the Respondent, the applicant retorted that the period of 30 days for filing an appeal runs from a definite and ascertainable date and that the judgement of the lower court does not indicate the date of its delivery. It was therefore his position that there is some uncertainty as to when the same was delivered. It was therefore the applicant’s position that in those circumstances the appeal cannot be said to have been filed out of time.

Determination

11. These two applications were directed to be heard together. However since the Respondent’s application, if successful, would have the result of disposing of this appeal, I intend to start with the said application.

12. The applicant’s case is hinged on the fact that since the judgement was undated, time did not run against him so as to render his appeal incompetent. If the subject judgement was not dated, it is arguable whether or not there is a judgement capable of being appealed against. To that extent one may not fault the applicant, at least at this stage, in not filing his appeal within the prescribed period. The applicant has annexed to his replying affidavit, both the typed and handwritten copies of the judgement in question. I have perused both documents and I am unable to find the date when the said judgement was delivered.

13. In the premises it is my view without going into the details of the validity of the said judgement that the applicant’s application cannot be dismissed simply on the basis of the appeal having been filed out of time. Consequently, the Respondent’s application dated 14th March, 2018 fails and is dismissed but with no order as to costs as the parties failed to comply with this Court’s directions to furnish the Court with soft copies of their pleadings and submissions.

14. As regards the prayer for stay of execution, the principles guiding the grant of a stay of execution pending appeal are well settled. These principles are provided under Order 42 rule 6(2) of the Civil Procedure Rules which provides as follows:

No order for stay of execution shall be made under subrule

(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.

15. In Vishram Ravji Halai vs. Thornton & Turpin Civil Application No. Nai. 15 of 1990 [1990] KLR 365,the Court of Appeal held that whereas the Court of Appeal’s power to grant a stay pending appeal is unfettered, the High Court’s jurisdiction to do so under Order 41 rule 6 of the Civil Procedure Rules is fettered by three conditions namely, establishment of a sufficient cause, satisfaction of substantial loss and the furnishing of security. Further the application must be made without unreasonable delay. To the foregoing I would add that the stay may only be granted for sufficient cause and that the Court in deciding whether or not to grant the stay and that in light of the overriding objective stipulated in sections 1A and 1B of the Civil Procedure Act, the Court is nolonger limited to the foregoing provisions. The courts are now enjoined to give effect to the overriding objective in the exercise of its powers under the Civil Procedure Act or in the interpretation of any of its provisions. According to section 1A(2) of the Civil Procedure Act “the Court shall, in the exercise of its powers under this Act or the interpretation of any of its provisions, seek to give effect to the overriding objective” while under section 1B some of the aims of the said objective are; the just determination of the proceedings; the efficient disposal of the business of the Court; the efficient use of the available judicial and administrative resources; and the timely disposal of the proceedings, and all other proceedings in the Court, at a cost affordable by the respective parties.

16. It therefore follows that all the pre-Overriding Objective decisions must now be looked at in the light of the said provisions. This does not necessarily imply that all precedents are ignored but that the same must be interpreted in a manner that gives effect to the said objective. What is expected of the Court is to ensure that the aims and intendment of the overriding objective as stipulated in section 1A as read with section 1B of the Civil Procedure Act are attained. It is therefore important that the Court takes into consideration the likely effect of granting the stay on the proceedings in question. In other words the Court ought to weigh the likely consequences of granting the stay or not doing so and lean towards a determination which is unlikely to lead to an undesirable or absurd outcome. What the Court ought to do when confronted with such circumstances is to consider the twin overriding principles of proportionality and equality of arms which are aimed at placing the parties before the Court on equal footing and see where the scales of justice lie considering the fact that it is the business of the court, so far as possible, to secure that any transitional motions before the Court do not render nugatory the ultimate end of justice. The Court, in exercising its discretion, should therefore always opt for the lower rather than the higher risk of injustice. See Suleiman vs. Amboseli Resort Limited [2004] 2 KLR 589. This was the position of Warsame, J (as he then was) in Samvir Trustee Limited vs. Guardian Bank Limited Nairobi (Milimani) HCCC 795 of 1997 where he expressed himself as hereunder:

“Every party aggrieved with a decision of the High Court has a natural and undoubted right to seek the intervention of the Court of Appeal and the Court should not put unnecessary hindrance to the enjoyment and exercise of that right by the defendant. A stay would be overwhelming hindrance to the exercise of the discretionary powers of the court…The Court in considering whether to grant or refuse an application for stay is empowered to see whether there exist any special circumstances which can sway the discretion of the court in a particular manner. But the yardstick is for the court to balance or weigh the scales of justice by ensuring that an appeal is not rendered nugatory while at the same time ensuring that a successful party is not impeded from the enjoyment of the fruits of his judgement. It is a fundamental factor to bear in mind that, a successful party is prima facieentitled to the fruits of his judgement; hence the consequence of a judgement is that it has defined the rights of a party with definitive conclusion. The respondent is asserting that matured right against the applicant/defendant…For the applicant to obtain a stay of execution, it must satisfy the court that substantial loss would result if no stay is granted. It is not enough to merely put forward mere assertions of substantial loss, there must be empirical or documentary evidence to support such contention. It means the court will not consider assertions of substantial loss on the face value but the court in exercising its discretion would be guided by adequate and proper evidence of substantial loss…Whereas there is no doubt that the defendant is a bank, allegedly with substantial assets, the court is entitled to weigh the present and future circumstances which can destroy the substratum of the litigation…At the stage of the application for stay of execution pending appeal the court must ensure that parties fight it out on a level playing ground and on equal footing in an attempt to safeguard the rights and interests of both sides. The overriding objective of the court is to ensure the execution of one party’s right should not defeat or derogate the right of the other. The Court is therefore empowered to carry out a balancing exercise to ensure justice and fairness thrive within the corridors of the court. Justice requires the court to give an order of stay with certain conditions.”

17. Therefore this Court must guard against any action or inaction whose effect may remove pith of this litigation and leave only a shell as was appreciated by the Court of Appeal position in Dr Alfred Mutua vs. Ethics & Anti-corruption Commission & Others Civil Application No. Nai. 31 of 2016 in which it cited the Nigerian Court of Appeal decision of Olusi & Another vs. Abanobi & Others [suit No. CA/B/309/2008] that:

“It is an affront to the rule of law to… render nugatory an order of Court whether real or anticipatory. Furthermore…parties who have submitted themselves to the equitable jurisdiction of courts must act within the dictates of equity.”

18. It is trite that in giving effect to the rights the courts must balance fundamental rights of individual against the public interest in the attainment of justice in the context of the prevailing system of legal administration and the prevailing economic, social and cultural conditions. See Bell vs. DPP [1988] 2 WLR 73.

19. Apart from that as the Supreme Court appreciated in Gitirau Peter Munya vs. Dickson Mwenda Kithinji & 2 Others [2014] eKLR, the Court must consider whether or not it is in the public interest that the order of stay be granted and that this condition is dictated by the expanded scope of the Bill of Rights, and the public spiritedness that run through the Constitution.

20. On the first principle, Platt, Ag.JA (as he then was) in Kenya Shell Limited vs. Kibiru [1986] KLR 410, at page 416 expressed himself as follows:

“It is usually a good rule to see if Order XLI Rule 4 of the Civil Procedure Rules can be substantiated. If there is no evidence of substantial loss to the applicant, it would be a rare case when an appeal would be rendered nugatory by some other event. Substantial loss in its various forms, is the corner stone of both jurisdictions for granting a stay. That is what has to be prevented. Therefore without this evidence it is difficult to see why the respondents should be kept out of their money”.

21. On the part of Gachuhi, Ag.JA (as he then was) at 417 held:

“It is not sufficient by merely stating that the sum of Shs 20,380. 00 is a lot of money and the applicant would suffer loss if the money is paid. What sort of loss would this be? In an application of this nature, the applicant should show the damages it would suffer if the order for stay is not granted. By granting a stay would mean that status quo should remain as it were before judgement. What assurance can there be of appeal succeeding? On the other hand, granting the stay would be denying a successful litigant of the fruits of his judgement.”

22. Dealing with the contention that the fact that the respondent is in need of finances is an indication that he would not be in position to refund the decretal sum, Hancox, JA (as he then was) in the above cited case when he expressed himself as follows:

“I therefore think in the circumstances that these comments were unfortunate. Nevertheless, having considered the matter to the full, and with anxious care, there is in my judgement no justification whatsoever for holding that there is a likelihood that the respondents will not repay the decretal sum if the appeal is successful and that the appeal will thereby be rendered nugatory. The first respondent is a man of substance, with a good position and prospects. It is true his house was, in his words, reduced to ashes, but I do not take that against him. Both seem to me to be respectable people and there is no evidence that either will cease to be so, in particular that the first respondent will not remain in his job until pensionable age.”

23. Therefore the mere fact that the decree holder is not a man of means does not necessarily justify him from benefiting from the fruits of his judgement. On the other hand, the general rule is that the Court ought not to deny a successful litigant of the fruits of his judgement save in exceptional circumstances where to decline to do so may well amount to stifling the right of the unsuccessful party to challenge the decision in the higher Court. In Machira T/A Machira & Co Advocates vs. East African Standard (No 2) [2002] KLR 63 it was held that:

“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 the other, contrary to sound principle for the exercise of a judicial discretion. The ordinary principle is that a successful party is entitled to the fruits of his judgement or of any decision of the court giving him success at any stage. That is trite knowledge and is one of the fundamental procedural values which is acknowledged and normally must be put into effect by the way applications for stay of further proceedings or execution, pending appeal are handled. In the application of that ordinary principle, the court must have its sight firmly fixed on upholding the overriding objective of the rules of procedure for handling civil cases in courts, which is to do justice in accordance with the law and to prevent abuse of the process of the court”.

24. Where the allegation is that the respondent will not be able to refund the decretal sum the burden is upon the applicant to prove that the Respondent will not be able to refund to the applicant any sums paid in satisfaction of the decree. See Caneland Ltd. & 2 Others vs. Delphis Bank Ltd. Civil Application No. Nai. 344 of 1999.

25. The law, however appreciates that it may not be possible for the applicant to know the respondent’s financial means. The law is therefore that all an applicant can reasonably be expected to do, is to swear, upon reasonable grounds, that the Respondent will not be in a position to refund the decretal sum if it is paid over to him and the pending appeal was to succeed but is not expected to go into the bank accounts, if any, operated by the Respondent to see if there is any money there. The property a man has is a matter so peculiarly within his knowledge that an applicant may not reasonably be expected to know them. In those circumstances, the legal burden still remains on the applicant, but the evidential burden would then have shifted to the Respondent to show that he would be in a position to refund the decretal sum. See Kenya Posts & Telecommunications Corporation vs. Paul Gachanga Ndarua Civil Application No. Nai. 367 of 2001;ABN Amro Bank, N.K. vs. Le Monde Foods Limited Civil Application No. 15 of 2002.

26. What amounts to reasonable grounds for believing that the respondent will not be able to refund the decretal sum is a matter of fact which depends on the facts of a particular case. In my view even if it were shown that the respondent is a man of lesser means, that would not necessarily justify a stay of execution as poverty is not a ground for denial of a person’s right to enjoy the fruits of his success. As was held in Stephen Wanjohi vs. Central Glass Industries Ltd. Nairobi HCCC No. 6726 of 1991, financial ability of a decree holder solely is not a reason for allowing stay; it is enough that the decree holder is not a dishonourable miscreant without any form of income.

27. Although the parties herein have, and regrettably so, not exhibited copies of the pleadings, from the judgement, it comes out that the cause of action was malicious arrest and/or prosecution. The Respondent was awarded Kshs 3,000,000. 00. While the applicant has not furnished any basis for his apprehension that the Respondent is unlikely to refund the decretal sum in the event that the appeal succeeds, the Respondent has likewise not contested that allegation made on oath. There is for example no positive and express averment in the replying affidavit that the Respondent is in a position to refund the said award. While the general rule is that poverty of the judgement creditor is not necessarily a ground for granting stay of execution, where the award is on the face of it high, that is a factor which this Court may take into account.

28. Therefore with respect to the issue whether or not the applicant stands to suffer substantial loss in Job Kilach vs. Nation Media Group & 2 Others Civil Application No. Nai. 168 of 2005 the Court of Appeal citing Oraro & Rachier Advocates vs. Co-operative Bank of Kenya Limited Civil Application No. Nai. 358 of 1999 held that where there is a decree against the applicant but the amount is colossal, it cannot be lost sight of the fact that the decretal sum is a very large sum, which by Kenyan standards very few individuals will be in a position to pay without being overly destabilized. In the said case the amount in question was Kshs. 4,000,000. 00. However, in this case it is not contended that the applicant is not in a position to pay the said sum or that if made to pay the same it is likely to find itself in some financial embarrassment. To the contrary it is contended that it is the respondent’s ability to refund the sum in question that has been brought into question. That the amount involved is by no means smallish is not in doubt.

29. In the result the order that commends itself to me and which I hereby grant is that there will be a stay of execution of the judgement appealed from pending the hearing and determination of the appeal on condition that the applicant deposits Kshs 1. 5 million in a joint interest earning account with Kenya Commercial Bank, Machakos Branch within 30 days from the date of this decision and in default, the application will be deemed to have been dismissed in which event the Respondent will be at liberty to execute for the full amount.

30. As none of the parties complied with the direction to furnish the Court with soft copies of their pleadings and submissions as at the time of writing this ruling, there will be no order as to costs of both applications.

31. It is so ordered.

Read, signed and delivered in open Court at Machakos this 31st day of July, 2018.

G V ODUNGA

JUDGE

Delivered in the presence of:

Mr Nthiwa for Mr Chege for the Respondent

Miss Kinuthia for Mr Mutiso for the Appellant

CA Geoffrey