China City Construction Company Limited & another v Karisa (Suing as the Administrator and Legal Representative of the Estate of the Late Didlora Mwaka Mwangala) [2024] KEHC 3323 (KLR)

China City Construction Company Limited & another v Karisa (Suing as the Administrator and Legal Representative of the Estate of the Late Didlora Mwaka Mwangala) (Civil Appeal 105 of 2023) [2024] KEHC 3323 (KLR) (8 April 2024) (Ruling)

Neutral citation: [2024] KEHC 3323 (KLR)

Republic of Kenya

In the High Court at Malindi

Civil Appeal 105 of 2023

SM Githinji, J

April 8, 2024

Between

China City Construction Company Limited

1st Appellant

Kennedy Sete Kiprotich

2nd Appellant

and

Mbura Herbert Karisa (Suing as the Administrator and Legal Representative of the Estate of the Late Didlora Mwaka Mwangala)

Respondent

(Being an appeal from the Judgment of Honourable R.Amwayi – SRM dated, signed and delivered in the Chief Magistrate’s Civil Suit No.E046 of 2021 Kaloleni on 14th July, 2023)

Ruling

Representation:Mr Wachira Advocates for the Applicant/AppellantMr Ngure Advocates for the Respondent 1. For determination is the Appellant’s notice of motion dated 18th July 2023. In the motion which is brought under sections 1A, 1B,3 and 3A of the Civil Procedure Act and Order 42 Rule 6 of the Civil Procedure Rules, the Appellants want the following orders: -a.Spent.b.Spent.c.There be a stay of execution of the judgment of the court delivered on June 14, 2023 in Civil Suit No. E046 of 2021 Kaloleni pending the hearing and determination of the intended appeal.d.The appellant be allowed to furnish acceptable bank guarantee that it will settle the decretal amount and costs that will be awarded in the appeal.e.Costs of this application to abide the outcome of the intended appeal.

2. The application is supported by the affidavit sworn by Bi Cheng Chuan and the grounds found on the face of the motion.

3. In opposition, the Respondent filed a Replying Affidavit which he swore on 2nd August 2023 stating that the application is a smack on the face of this court and should be dismissed in its entirety. He added that the Appellant should deposit the entire decretal amount in court and have the appeal heard expeditiously so as not to defeat justice as he has continued to suffer mental anguish and pain.

4. The application was canvassed by way of written submissions.

Appellant’s Submissions 5. In submissions filed on 2nd October 2023, counsel submitted that the decretal amount is substantial and if the stay is not granted, the Appellants may have no remedy if the appeal succeeds. To counsel, this would amount to substantial loss. He relied on the cases of James Wangalwa & another v Agnes Naliaka Cheseto [2012] eKLR and Michira t/a Michira & Co. Advocates v East African Standard [2002] eKLR.

6. Counsel added that the application was made without unreasonable delay and he relied on the case of Thomas K’bahati t/a K/Bahati & Co. Advocates v Janendra Raichand Shah [2021] eKLR.

7. With regard to security for costs, counsel urged the court to accept the bank guarantee annexed in the supporting affidavit. He relied on the case of Absalom Dova v Tarbo Transporters [2013] eKLR; Beranrd Ontita Zebedeo v Julius Nyamwega Ontere [2022] eKLR; Justin Mutunga David v China Road & Bridge Corporation (K) Limited [2019] eKLR; National Bank of Kenya Limited v Rachuonyo & Rachuonyo Advocates [2021] eKLR, Charles Wesonga Mbingi v Commissioner of Investigations and Enforcement [2021] eKLR; and Mbukoni Services Limited & another v Mutinda Reuben Nzili & 2 others [2021] eKLR.

Respondent’s Submissions 8. Citing the case of Mbula v Nzangani (Civil Appeal E150 of 2022) [2023] KEHC 18249 (KLR) and Nicholas Stephen Okaka & anor v Alfred Waga Wesonga [2022] eKLR, counsel submitted that a bank guarantee is not proof of funds and that the Appellants ought to deposit the entire decretal amount either in court or a joint interest earning account.

9. The provisions of Order 42 (6) of the Civil Procedure Rules, 2010 provide guidelines in an application for stay of execution and states that:“(1)No appeal or second appeal shall operate as a stay of execution or proceeding 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 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 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; andb.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.

10. In Butt v Rent Restriction Tribunal (1982) KLR 417 the Court of Appeal held that the general principle in granting or refusing stay is if there is no overwhelming hindrance, a stay must be granted so that an appeal may not be rendered nugatory should that appeal court reverse the trial court’s discretion.

11. It follows therefore that this court, in such application as the present one, must consider whether the Appellant has met the conditions namely- establishment of a sufficient cause, satisfaction of substantial loss and the furnishing of security. The application must also have been made without unreasonable delay.

12. In this case, the impugned judgment was delivered on 14th July 2023 and the present application filed on 19th July 2023, while the memorandum of appeal was filed on 10th July 2023. There is therefore no unreasonable delay.

13. On substantial loss, it was the Appellant’s allegation that the decretal amount is substantial, if paid to the Respondent and the appeal succeeds, they may not be able to recover the same.On this principle, Platt, Ag. JA (as he then was) in Kenya Shell Limited v 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:“It is not sufficient by merely stating that the sum of Kshs 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. Guided by the above reasoning, I am not convinced that the reasons advanced by the Appellants sufficiently demonstrates likelihood of suffering substantial loss. Be that as it may, I note that in the Replying Affidavit, the Respondent is somewhat open to granting of the orders sought as long as the decretal amount is deposited in court as security to pave way for the appeal. For the reason, and in the interest of broad justice, I hereby grant conditional stay of execution pending hearing and determination of the appeal in the following terms: -a.That the Appellants do deposit in court within 30 days the decretal sum Kshs. 2,939,400/-, failure to which, the Respondent shall be at liberty to execute.b.Costs to abide the outcome of the appeal.

RULING READ, SIGNED AND DELIVERED VIRTUALLY AT MALINDI THIS 8TH DAY OF APRIL, 2024. ...................................S.M.GITHINJIJUDGEIn the Presence of; -1. Mr Ngure for the Respondent2. Mr Wachira for the Applicant