Clement Muturi Kigano v Shengli Engineering Construction Group Limited [2020] KEHC 602 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT NAIROBI

CIVIL CASE NO. 212 OF 2011

CLEMENT MUTURI KIGANO............................................PLAINTIFF

VERSUS

SHENGLI ENGINEERING CONSTRUCTION

GROUP LIMITED.............................................................DEFENDANT

RULING

1)   The subject matter of this ruling are the two applications.

The first application is the motion dated 12th October 2020  taken out by the plaintiff/applicant whereof he sought for the following orders:

i.  THAT leave be granted to the plaintiff to forthwith execute the decree passed by this court on 24th September 2020 as relates to payment of ksh. 10 million, which was secured by Bank Guarantee dated 14th June, 2013 issued by Citibank, N.A

ii. THAT Citibank, N.A be directed to forthwith pay to the plaintiff’s advocates, M/as Amuga and Company Advocates the sum of Kenya Shillings Ten Million (Kshs.10,000,000/=)

iii.  THAT the balance of the decretal sum plus interest and costs be paid upon ascertainment of costs by taxation or agreement between the parties.

iv. THAT such further or other order be granted as the court may deem fit  in the circumstances of this case.

2)  The second motion dated 26. 10. 2020 is taken out by the defendant/ respondent whereof it sought to be granted the   following orders:

a) This application be certified as urgent and heard ex parte in the first instance.

b)  There be a stay of execution of the judgment and decree of the honourable court rendered on 24th September 2020 pending the hearing and determination of this application.

c)  There be a stay of execution of the judgment and decree of the honourable court rendered on 24th September 2020 pending the hearing and determination of the defendant/applicants appeal against the judgment and decree.

d) This court be pleased to give any further or other order as it may deem just and expedient.

e)  Costs incidental to this application abide with the results of the defendant/applicant’s appeal

3) When the motions came up for interpartes hearing this court gave orders directing the two application to be heard   together.

4)   Though the motion dated 26. 10. 2020 was filed later than the one dated 12th October 2020, I think it is important to determine it first. I have already set out the orders sought in the aforesaid motion. The motion is supported by the affidavit sworn by Victor Lubelo Khomo.  When served, the plaintiff filed the replying affidavit he swore to oppose the motion.

5)   It is not in dispute that on 24th September 2020 this court Delivered  its judgment in favour of the plaintiff whereof    was awarded inter   alia:

Special damages       ksh.2,030,534/=

General damages for pain & suffering                               ksh.8,000,000/=

Interest and costs.

6)   Being aggrieved, the defendant has filed a notice of appeal to challenge the aforesaid judgement in the Court of Appeal.

7)   The defendant is now before this court seeking to be granted an order for stay of execution pending appeal.  It is the submission of the defendant that unless the order for stay is granted it would suffer substantial loss in that the financial circumstances of the plaintiff is unknown hence there is no guarantee that if the decretal sum is paid to him he would be in a position to repay if the appeal turns successful.  The defendant stated that it is willing to abide by any conditions this court imposes as security for the due performance of the decree.

8)   The plaintiff opposed the motion arguing that he is in a position to refund the decretal sum if required at the conclusion of the appeal.  The plaintiff stated that he is currently a Member of Parliament and also the chairman of the Parliamentary Departmental Committee on Justice and Legal Affairs Committee.    He also annexed to the replying affidavit copies of seven (7) land titles to show that he owns highly valuable properties in Kenya.

9)   The plaintiff further argued that the defendant has failed to demonstrate that it will suffer substantial loss since he has   proved that he is capable of refunding the decretal sum if paid to him.

10) The principles to be considered in an application for stay of execution pending appeal are provided for under Order 42 rule 6 of the Civil Procedure Rules.  The first is that an application for stay of execution pending appeal must be filed without unreasonable delay. It is the defendant’s submission that it filed the motion without unreasonable delay.

11) The plaintiff is of the submission that the application was filed after a long delay and as an afterthought.  The record shows that this court delivered its judgment on 24th September 2020.  The defendant filed the application for stay on 26th October 2020.  The application was filed 32 days after the date of delivery of judgement.  In my view the delay is not inordinate. I am satisfied that the motion was filed without unreasonable delay.

12) The second principle is that an applicant must show the substantial loss it would suffer if the order for stay is denied.  In this case the defendant has stated that there is no evidence that the plaintiff is in a positon to refund the decretal sum when required.  The plaintiff has stated that he is in a positon to refund the decretal sum if paid.  He stated that he is a Member of Parliament and on top of that he is the chairman of the Parliamentary Departmental Committee on Justice and Legal Affairs Committee.  He also averred that he owns highly valuable properties in Kenya.

13) I have carefully considered the material placed before this court by the plaintiff.  The plaintiff did not place before this court evidence of earnings in form of payslips or bank statements.  It is possible that the aforesaid documents may reveal that the plaintiff has committed his earnings to loan repayments leaving nothing to repay the decretal sum.

14) The plaintiff also failed to attach estimated values of the landed properties he owns.  Even if he had done so, I doubt whether those properties would easily be disposed of to easily make a refund of the decretal sum. In the end I am convinced that the defendant has shown that it would suffer substantial loss if the order for stay is denied in that there is no credible evidence that the plaintiff is in a financial position to refund the decretal sum within a short notice should the appeal turn successful.

15) The third and final principle is the provision for security for the due performance of the decree.  The defendant has stated that it is willing to abide by any conditions that this court may find just and equitable to issue.  I think a reasonable order to make in the circumstances to direct the defendant to deposit the judgment sum in an interest earning account in the joint names of learned advocates.

16) In the end the motion dated 26. 10. 2020 is allowed.

Consequently,

(a) An order for stay of the execution of the decree pending appeal is granted on condition that the defendant/applicant deposits the principal decretal sum of ksh.10,030,534/= in an interest earning account in the joint names of the firms of advocates appearing in this suit within a period of 45 days from the date hereof.  In default the order for stay shall automatically lapse. Costs of the motion to abide the outcome of the appeal.

17) In the motion dated 12th October 2020, the main order sought by the plaintiff is for leave to execute the decree passed by this court on 24th September 2020 as relates to payment of kshs.10,000,000/= which amount was secured by bank guarantee dated 14th June 2013, by Citibank N.A and that the balance of the decretal sum plus interest and costs be paid upon ascertainment of costs by taxation or agreement between the parties.

18) In the supporting affidavit sworn by Paul Amuga, learned Advocate for the plaintiff, it is deponed that it will take quite some time for the plaintiff to have his bill of costs, taxed by the court.  It is further deponed that since the money is not accruing any interest and since there is no order staying execution of the decree it is in the interest of both parties that the said sum be paid to the plaintiff forthwith.  Mr. Achoki, learned advocate for the defendant/respondent argued that the motion is premature.

19)The plaintiffs application is based on Section 94 of the Civil Procedure Actwhere the court has a discretionary power to allow execution of decree it passed before costs are ascertained.  The courts discretion can be exercised if it considers it necessary.

20) There is no doubt that this court has already made a granting an order for stay of execution of the decree pending appeal. In the circumstances this court finds it not necessary to grant the order for execution before taxation.

21) In the end the motion dated 12. 10. 2020 if found to be without merit. The same is dismissed with each party meeting its own costs on the motion.

Dated, Signed and Delivered online via Microsoft Teams at Nairobi this 17th day of December, 2020.

……………………………..

J.  K. SERGON

JUDGE

In the presence of:

…………………………….…. for the Plaintiff

……………………………….. for the Defendant