[2022] KEHC 9966 (KLR)

Waweru v Kabuga (Civil Appeal E011 of 2022) [2022] KEHC 9966 (KLR) (8 July 2022) (Ruling)

Neutral citation: [2022] KEHC 9966 (KLR)

Republic of Kenya

In the High Court at Nakuru

Civil Appeal E011 of 2022

TM Matheka, J

July 8, 2022

Between

Peter Waweru

Applicant

and

Daniel Mumochu Kabuga

Respondent

Ruling

1. The Applicant Peter Waweru vide an application dated 1st February, 2022 brought pursuant to Order 51 Rule1, Order 42 Rule 6(1), Order 43 rule 1 of the Civil Procedure Rules 2010 and Section 3A of the Civil Procedure Act seeks the ORDERS:-1. Spent;2. Thatthis Honourable court be pleased to order the release of Motor Vehicle Registration number KAA 870E- Isuzu Lorry and the same to be on running attachment pending the hearing and determination of this Application;3. Thatthis Honourable Court be pleased to grant a stay of further execution of the ex-parte judgement in NakuruCMCC 856 OF 2018, warrants of attachment issued on 20th August, 2021 as against the Appellant/Applicant and sale of Motor Vehicle Registration number KAA 870 E-Isuzu Lorry pending the hearing and determination of the Applicant’s appeal in Nakuru HCCA NO.11 OF 2022. 4.Thatthis Honourable court be pleased to order the release of Motor Vehicle KAA 870E- Isuzu Lorry and to be on a running attachment pending the hearing and determination of the applicants appeal in Nakuru HCCA NO.11 of 2022. 5.Thatthis Honourable Court be pleased to issue any other Orders as it may deem just, appropriate and expedient in the interest of justice.6. Thatcosts of this application be provided.

2. The application is supported by the grounds on its face and the supporting affidavit of Peter Waweru sworn on the even date. He deponed that he is the owner of the Motor Vehicle Registration Number KAA 870E and that at the time of filing the application for stay and setting aside the interlocutory judgement in the trial court, the respondent herein had commenced execution and attached the suit motor vehicle which is currently at an auctioneer’s yard.

3. That the Ruling against which he had preferred an appeal was delivered on the 18th January, 2022 thus he is exposed to a possible further execution which essentially means the suit motor vehicle is on the verge of being advertised for sale by auction.

4. He deposed that being aggrieved and dissatisfied with the said ruling he instructed his advocates to appeal against the said ruling and that he was condemned unheard since the trial court dismissed his application seeking to defend the lower court matter despite submitting that he was not served with hearing notices.

5. He averred that the motor vehicle which is subject to this suit was attached on 1st September, 2021 and has been in the custody of the auctioneers to date and that this court has power to order the release of the said motor vehicle on a running attachment in the interest of justice.

6. He stated that his Appeal is meritorious and unless stay of execution is granted the said appeal will be an exercise in futility.

7. He deposed that the respondents will suffer no prejudice if this application is allowed and that he is ready and willing to deposit the log book of the subject Motor Vehicle as security.

8. The Application is opposed by the respondent Daniel Mumochi Kabuga vide his Replying Affidavit sworn on 22nd February, 2022.

9. He deponed that the application lacks merit, is frivolous and vexatious.

10. That the suit motor vehicle at the auctioneer’s yard continues to attract storage charges which the applicant has occasioned due to vexatious approach to the whole issue.

11. It was his deposition that whereas the applicant is entitled to exhaust all avenues of litigation available he, the respondent is also entitled to the fruits of his judgement.

12. He stated that the release of the motor vehicle on a running attachment does not guarantee that the motor vehicle will be maintained in its current mechanical condition for as long as it may take for the this application and appeal to be heard and determined.

13. He deposed that in the event the court grants the orders sought herein then the Applicant should be ordered to deposit in court the full decretal amount of Kshs.939,949. 00/= within a prescribed time failure to which execution should proceed.

14. That applicant swore a further Affidavit on 28th February, 2022. He averred that by filing the appeal he is exercising his right to appeal as provided under the law and there is an apprehension that the respondent’s means are not known and therefore if stay is not granted it will be impossible to recover the decretal amount in the event he is successful in the appeal.

15. He stated that his quest for release of the motor vehicle on a running attachment will not defeat the rights of the respondent herein as a decree holder and even if the vehicle will have depreciated at the time the appeal is decided he will be obligated by law to satisfy the whole decretal amount through other means.

16. He stated that the keeping of the motor vehicle at the yard until the appeal is heard and determined will not only depreciate the motor vehicle’s value but will also lead to accrual of colossal storage charges and denial of use of his only tool of trade.

17. He reiterated that he is willing to deposit the log book or any other reasonable security as may be ordered by this court pending the hearing and determination of the appeal.

18. The parties through their respective counsel agreed to canvass the application via Written Submissions.

Appellant’s/Applicant’s Written Submissions 19. The Applicant filed his submissions on 2nd of March, 2022.

20. The applicant submitted that he has met the conditions required for the stay to be granted.

21. On substantial loss, the applicant submitted that he has a meritorious and arguable appeal which has high chances of success and if the orders sought are not granted he is apprehensive that the respondent may levy execution against him rendering the appeal nugatory. As a result of which he will suffer substantial loss.

22. He submitted that the judgement is of a substantial amount and if execution proceeds he might not be able to recover it since the respondent has not demonstrated whether he has the capacity to refund the same in the event his appeal is successful.

23. He therefore urged this court to strike a balance between the respondent’s right to enjoy the fruits of his judgement and his right to pursue an appeal. To buttress this position, the Applicant placed reliance on the case of Joseph Kakomo Mbenga v Maingi Charles & Another [2018] eKLR where the court stated as follows;“….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….”

24. The Applicant submitted that this Application has been filed without unreasonable delay since the lower court Ruling was delivered on 18th January, 2022 in which he has preferred the instant appeal and filed this Application 1st February, 2022 without unreasonable delay.

25. It was the Applicant’s submissions that he is willing to furnish reasonable security as to be ordered by the court. He is also willing to deposit the log book of the subject Motor Vehicle as security pending hearing and determination of the appeal.

26. He prayed that this court allows his application.

Respondent’s Submissions 27. The Respondent filed his Submissions on 2nd March, 2022. He submitted that grant of stay of execution pending appeal is provided for under Order 42 Rule 6 of the Civil Procedure Rules. That to grant or refuse the order of stay of execution pending appeal is discretionary and the court while granting the same must balance the interest of the appellant and the respondent. To support this position the respondent relied on the case of Absalom Dova v Tarbo Transporters [2013] eKLR.

28. The respondent submitted that if the court is persuaded to grant the orders of stay, then it should order the applicant to deposit in court the full decretal sum of Kshs.939,949. 00/= within a prescribed time as security failure to which the execution to proceed. He relied on the cases of Mwaura Karuga t/a Limit Enterprises v Kenya Bus Services Ltd & 4 others [2015] eKLR, In Gianfranco Manenthi & another v Africa Merchant Assurance Company Ltd [2019] eKLR & Arun C. Sharma v Ashana Raukundalia t/a Rairundalia & Co. Advocates & 2 others [2014] eKLR which elucidated the purpose and importance of security in an application for grant of stay of execution pending appeal.

Issues For Determinationi.Whether the Application meets the conditions for grant of stay of execution.

Analysis Whether the Application meets the conditions for grant of stay of execution? 29. The prerequisites for grant of stay of execution orders are set out under Order 42 Rule 6 (1) and (2) of the Civil Procedure Rules, thus:(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(2)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 the case of Elena Doudoladova Korir v Kenyatta University [2014] eKLR Justice Nzioki wa Makau had this to say:-“the application must meet a criteria set out in precedents and the criteria is best captured in the case of Halal & another v Thornton & Turpin Ltd where the Court of Appeal (Gicheru JA, Chesoni & Cockar Ag JA) held that“The High Court’s discretion to order stay of execution of its order or decree is fettered by three conditions, namely: - sufficient cause; substantial loss would ensue from a refusal to grant stay;. the Applicant must furnish security; the application must be made without unreasonable delay.”

31. Was there unreasonable delay in the filing of the matter? The ruling of the lower Court was delivered on 18th January 2022. The instant application was filed on 1st February 2022. The Application was filed within reasonable time.

32. Has the applicant demonstrated that he will suffer Substantial loss?. It is not in dispute that the execution process has been put in motion. Indeed, the Applicant’s motor vehicle has been attached by the auctioneers and it is in their yard. The Applicant is apprehensive that in the event that the Appeal is successful, the Respondent may not be able to refund the decretal sum. The Respondent has not disclosed his means. The Court of Appeal in the case of Nairobi Civil Application 238 of 2005 (UR 144/2005) National Industrial Credit Bank Ltd v Aquinas Francis Wasike & another it was stated:“This court has said before and it would bear repeating that while the legal duty is on an applicant to prove the allegation that an appeal would be rendered nugatory because a respondent would be unable to pay back the decretal sum, it is unreasonable to expect such an applicant to know in detail the resources owned by a respondent or the lack of them. Once an applicant expresses a reasonable fear that a respondent would be unable to pay back the decretal sum, the evidential burden must then shift to the respondent to show what resources he has since that is a matter which is peculiarly within his knowledge – see for example section 112 of the Evidence Act, Chapter 80 Laws of Kenya.”

33. Has the applicant offered any security? The Applicant has offered to deposit in court the log book of the subject Motor Vehicle as security. He is also willing to abide by the conditions that the court may impose for the due performance of the decree.

34. On the issue of security, the respondent deponed and submitted if the court was inclined to allow the application to require the applicant to deposit the entire decretal sum of Kshs. 939,949/= in court within such a period as described by court. For this he cited;I)Mwaura Karuga t/a Limit Enterprises v Kenya Bus Services Ltd & 4 others [2015] eKLR;“…. the security must be one which shall achieve due performance of the decree which might ultimately be binding on the applicant. The rule does not, therefore, envisage just any security. The words ‘ultimately be binding’ are deliberately used and are useful here, for they refer to the entire decree as will be payable at the time the appeal is lost. That is the presumption of law here. Therefore, the ultimate decree envisaged under order 42 rule 6 92) (b) of the Civil Procedure Rules includes costs and interest on the judgment sum unless the latter two were not granted, which is seldom. The security to be given is measured on that yardstick.”II)Gianfranco Manenthi & another v Africa Merchant Assurance Company Ltd [2019] eKLR;“Further order 42 should be seen from the point of view that a debt is already owed and due for payment to the successful litigant in a litigation before a court which had delivered the matter in his favour. This is therefore to provide a situation for the court that if the appellant fails to succeed on appeal there could be no return to status quo on the part of the plaintiff to initiate execution proceedings where the judgment involves a money decree. The court would order for the release of the deposited decretal amount to the respondent in the appeal… Thus the objective of the legal provisions on security was never intended to fetter the right of appeal. It was also put in place to ensure that courts do not assist litigants to delay execution of decrees through filing vexatious and frivolous appeals. In any event, the issue of deposit of security for due performance of decree is not a matter of willingness by the applicant but for the court to determine. Counsel for the applicant submitted that he is ready to provide a bank guarantee as security for due performance of the decree.”III.Arun C. Sharma v Ashana Raikundalia t/a Rairundalia & Co. Advocates & 2 others [2014] eKLR;“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… Civil process is quite different because in civil process the judgment is like a debt hence the applicants become and are judgment debtors in relation to the respondent. That is why any security given under Order 42 rule 6 of the Civil Procedure rules acts as security for due performance of such decree or order as may ultimately be binding on the applicants. I presume the security must be one which can serve that purpose.”

35. From the foregoing authorities it is clear that the purport of the requirement for provision for security for the performance of the decree is twofold; to secure the successful litigant’s fruits of his judgment, and to ensure keep the appellant aware of his obligation to fulfil the decree in the event that his appeal is not successful.

36. The appellant had demonstrated this awareness in that he offers the log book of the said motor vehicle and other reasonable security that this court may deem appropriate and relies on Nduhiu Gitahi v Warungengo [1988] KLR 621, where the court stated;“The aim of the court in this case was to make sure, in an even-handed manner, that the appeal would not be prejudiced and that the decretal sum would be available if required. The respondent is not entitled, for instance, to make life difficult for the applicant, so as to tempt him into settling the appeal…”

37. It is therefore expected that the while the appellant pursues his appeal, the decretal sum would be available for the respondent should the appeal be dismissed. The question is whether the deposit of the log book by itself is sufficient security? I do not think so, the motor vehicle upon being released to the applicant will be in the control of the applicant. Its usage and depreciation by the time the appeal is heard may mean that the respondent, in the event the appeal is dismissed, may not recover the fruits of his judgment hence, leading to other proceedings in court. It would only be fair that the applicant deposit reasonable amount of the decretal sum, the log book of the motor vehicle as security for the performance of the decree.

38. In the upshot it is my view that it would be fair for the applicant to deposit the principal sum of Kshs. 614,985/= in court together with the log book, as security for performance of the decree.

39. Upon such deposit applicant’s motor vehicle be released from the auctioneer’s yard.

40. In the upshot the application for stay pending appeal succeeds and the following orders issue;1)The applicant deposits the principal sum of Kshs. 614,985/= and the log book for the lorry KAA 870 E Isuzu Lorry in court within 30 days hereof.2)Upon such deposit the motor vehicle be released to the applicant forthwith from the auctioneer’s yard.3)In default of (1) above prayer (1) and (2) to lapse.4)Costs to abide the outcome of the appeal.

DATED, SIGNED AND DELIVERED AT NAKURU VIRTUALLY THIS 8TH DAY OF JULY, 2022. MUMBUA T MATHEKAJUDGECA EdnaMburu for the appellantMr. Tombe for the RespondentAshitiva Advocates LLPlitigation@ahitivaadvocates.comTombe & Company Advocates,tombeadvocates@gmail.com