[2022] KEHC 3199 (KLR)

Zubaid Yusuf Alias Zubri Zubaid Yusuf & another v Mutua & another (Suing on Behalf of the Estate of Shadrack Kioko Kyego (Deceased)) (Civil Appeal E163 of 2021) [2022] KEHC 3199 (KLR) (13 July 2022) (Ruling)

Neutral citation: [2022] KEHC 3199 (KLR)

Republic of Kenya

In the High Court at Machakos

Civil Appeal E163 of 2021

GV Odunga, J

July 13, 2022

Between

Zubaid Yusuf Alias Zubri Zubaid Yusuf

1st Appellant

Zaycom Enterprises Limited

2nd Appellant

and

Jacinta Mueni Mutua

1st Respondent

Winfred Kavini Kioko

2nd Respondent

Suing on Behalf of the Estate of Shadrack Kioko Kyego (Deceased)

Ruling

1. Vide a notice of Motion Application dated 8th October 2021, the Applicant seeks the following orders;a.Spentb.Spentc.That there be stay of execution of the judgement and/ or decree in Machakos CMCC No. 560 of 2019 Jacinta Mueni Mutua and Winfred Kavini Kioko (Suing on behalf of the estate of Shadrack Kioko Kyego (Deceased) vs Zubaid Yusuf Alias Zubri Zubaid Yusuf and Zaycom Enterprises Limited and any consequential orders arising therefrom pending the hearing and determination of the Appeal filed herein

2. The same is supported by the affidavit of Zubaid Yusuf, the first applicant herein, sworn on 8th October 2021. According to the deponent, being dissatisfied with the judgement delivered on 8th of September 2021 in Machakos CMCC No. 560 of 2019 – Jacinta Mueni and Wilfred Kavini Kioko (Suing as the Legal Representatives of the Estate of Shadrack Kioko Kyengo (Deceased) vs. Zubaid Yusuf Alias Zubri Zubaid Yusuf and Zaycom Enterprises Limited), he instructed their advocates to lodged this appeal. It was deposed that in the said judgement the Court awarded Kshs 3,467,398. 00 plus costs and interest.

3. The deponent averred that she has applied for certified copies of the judgement and the 30-day stay has lapsed putting her at risk of execution therefore she stood to suffer substantial loss and prejudice. It was her view that the appeal has a high chance of success and undertook to furnish such security as the court may deem reasonable for the due performance.

4. In opposing the application, the Respondents, vide a replying affidavit sworn on 29th October 2021 by Jacinta Mueni Mutua, the widow of the deceased, deposed that the applicants had not satisfied Order 42 Rule 6 of the Civil Procedure Rules. It was her case that the application is an afterthought intended to deny the beneficiaries of the estate the fruits of judgement. She however prayed that in the event the prayers are granted, then the Appellants should be directed to pay her half the decretal sum and deposit half in a joint interest earning account in the names of the advocates within 30 days.

5. On behalf of the applicant it was submitted that they had satisfied Order 42 Rule 6 of the Civil Procedure Rules, 2010 and were thus entitled to the order sought. According to them, the appeal, based on the memorandum of appeal, had high chances of success on both matters of law and fact. In this regard they relied on the Court of Appeal’s decision in David Omwenga vs. John Teleyio [2010] eKLR and Nguruman Limited vs. Jan Bonde Neilson & 2 Others[2014] eKLR, and submitted that an arguable appeal is not one that will necessarily succeed but one that raises triable issues. It was contended that the Applicants would suffer irreparable loss if the stay was not granted as the Respondents had no known source of income and had not demonstrated that they would be able to refund the said amount in the event that the appeal.

6. It was disclosed that the Applicants had taken out an insurance policy with Metropolitan Canon insurance Company Limited and in the event that the appeal is not successful, then its insurers would pay the decretal sum. It was submitted that the applicants were willing to comply with the terms of security as may be ordered by the court. According to the Applicants, they moved with speed to pursue the appeal, an indication that they are keen in prosecuting it. They therefore prayed to be allowed to exercise their constitutional right to appeal as they had satisfied all the conditions of stay.

7. In response, the Respondents submitted that the Applicants had not demonstrated that they will suffer substantial loss and that the appeal is not arguable. It was submitted that the Respondents and the other beneficiaries would be caused great hardship as the wrongful acts of the Applicant robbed them of their father who was the breadwinner leaving the 1st Respondent solely responsible for the basic needs of the deceased children. Reliance was placed on the case of Jackson Kaio Kivuva vs. Peninah Wanjiru Muchebe (2021) eKLR.

8. In the Respondents’ view, based on the evidence of the investigating officer, the appeal is not merited and is an abuse of the court process. It was therefore submitted that this appeal is intended to delay payment of the decretal sum to the estate of the deceased. However, should the Court be inclined to grant the order of stay, it was urged to do so on condition that the Applicants pay her half the decretal sum and deposit half in a joint interest in the names of the advocates herein based on the case of JNM vs. PNM [2018] eKLR.

Determination 9. I have considered the application, the supporting affidavit, the grounds of opposition and the submissions filed as well as the authorities relied upon.

10. 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.

11. 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.

12. 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 in justice.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 facie entitled 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.”

13. 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”.

14. On his part Gachuhi, Ag.JA (as he then was), at 417, held that:“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.”

15. Dealing with the contention that there was no evidence that the 1st Respondent would be able to refund the decretal sum if paid over to the Respondent, 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.”

16. Therefore, the mere fact that the decree holder is not a man or woman 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. InMachiraT/AMachira &CoAdvocates 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”.

17. 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 CanelandLtd. & 2 Others vs. Delphis BankLtd. Civil Application No. Nai. 344 of 1999.

18. 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, in those circumstances, where the applicant has reasonable grounds which grounds must be disclosed in the application that the Respondent will not be in a position to refund the decretal sum if the appeal succeeds, 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 NdaruaCivil Application No. Nai. 367 of 2001; ABN Amro Bank, N.K. vs. Le Monde Foods Limited Civil Application No. 15 of 2002.

19. 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. Suffice to say as was held in Stephen Wanjohi vs. Central Glass IndustriesLtd.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.

20. In this case, the applicants have not disclosed their grounds for believing that the Respondents would not be able to refund the decretal sum herein as the supporting affidavit simply deposed that the judgement sum is substantial hence the Respondents may not be in a position to restitute should the appeal ultimately succeed. The deponent has not disclosed her source of information that the Respondents will be unable to refund the decretal sum if paid over to them. In my view it is not sufficient to simply make a bare averment that the Respondent will not be able to refund. As far as the Court is concerned the Respondent is the successful party and has a right to enjoy the fruits of his judgement unless the circumstances dictate otherwise. It is upon the party seeking to deprive the successful party from enjoying his fruits of judgement that ought to prove that those circumstances do exist. That threshold cannot be said to have been attained by mere bare allegations devoid of sources of information or grounds of belief.

21. In this case however, the decree sum is over Kshs 3 million. 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. With respect to the issue whether or not the applicant stands to suffer substantial loss in Job Kilach vs. Nation Media Group & 2 OthersCivil 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. Therefore, if the applicant were to prove that if compelled to settle the decretal sum it may well fold up hence be disabled in pursuing his otherwise merited appeal, the Court may, while also taking into account the prospects of the Respondent being able to be paid if the appeal were to fail, grant the stay sought.

22. While in this case, it is not contended that the applicant’s insurers are likely to fold up, the amount herein was awarded to an estate of the deceased. The Respondents, in the replying affidavit, have not challenged the averment that they may not be in a position o refund the amount in question should the appeal succeed.

23. In the premises, this is a matter where a stay ought to be granted on condition. In the absence of the grounds upon which the apprehension that the Respondents would not be in a position to refund the sum and in light of lack of positive averment by the Respondents that they are in a position to do so, the order that commends itself to me is that a condition ought to be granted on conditions. Accordingly, there will be a stay of execution pending this appeal on condition that the Applicants pay half of the decretal sum to the Respondents and deposits the other half in a joint interest earning account in Kenya Commercial Bank, Machakos, in the names of the advocates for the parties herein within 30 days from the date hereof. In default execution to proceed.

24. The costs of this application are awarded to the Respondents in any event.

25. It is so ordered.

READ, SIGNED AND DELIVERED IN OPEN COURT AT MACHAKOS THIS 13THDAY OF JULY, 2022. G V ODUNGAJUDGEDelivered in the presence of:Mr Makori for Ms Gichuki for the RespondentCA Susan