Devlink Resources Consultants & 2 others v Musau; Musau (Plaintiff); Devlink Resources Consultants & 2 others (Defendant) [2022] KEHC 10335 (KLR)

Devlink Resources Consultants & 2 others v Musau; Musau (Plaintiff); Devlink Resources Consultants & 2 others (Defendant) (Civil Appeal E92 of 2021) [2022] KEHC 10335 (KLR) (12 July 2022) (Ruling)

Neutral citation: [2022] KEHC 10335 (KLR)

Republic of Kenya

In the High Court at Machakos

Civil Appeal E92 of 2021

MW Muigai, J

July 12, 2022

Between

Devlink Resources Consultants

1st Applicant

Chase Bank Kenya (Ltd)

2nd Applicant

Matuu High School Limited

3rd Applicant

and

Anthony Mutunga Musau

Respondent

and

Anthony Mutunga Musau

Plaintiff

and

Devlink Resources Consultants

Defendant

Chase Bank Kenya (Ltd)

Defendant

Matuu High School Limited

Defendant

(Being an Appeal from the judgment by Hon. G. O. Shikwe in Kithimani PM’s Court PMCC No. 199 of 2017 delivered on 19/05/2017)

Ruling

Notice of Motion Application 1. Vide Application dated the July 12, 2021 under section 3A,79G and 95 of the Civil Procedure Act (cap 21), Order 22 rule, Order 42 Rule 4,6 and 7, Order 50 rule 6 and Order 51 rules 1 and 3 of the Civil Procedure, 2010and all other enabling provisions of the law and sought the following prayers;-a.Spentb.That this court grant an order of stay of execution of the judgment delivered by the trial court on May 19, 2021 pending the hearing and determination of this application.c.That this court grant an order of stay of execution of the judgment delivered by the trial court on May 19, 2021pending the hearing and determination of the Appeal.d.That the appellant/applicant be allowed to furnish thecourt with Bank guarantee as security pending the hearing and determination of the Appeal.e.That the cost of this application abide the outcome of the Appeal.

2. The Application is based on the following grounds inter alia that the appellants/applicants have an arguable Appeal with a high chances of success; that the appellants/applicants are apprehensive that unless the respondent is stayed by orders of this court will swiftly move for execution of the judgment; that the appellants/applicants are apprehensive that unless there is stay of execution the respondent will apply for execution which will render the Appeal nugatory; that the respondent/decree holder is a natural person whose means is unknown; that the Appellants/Applicants are ready to furnish a reasonable security in the form of a bank guarantee from Diamond Trust Bank.

3. The Application is supported by the affidavit of Kevin Ngure sworn on July 12, 2021in which he deposed that he is the Legal Officer at Directline Assurance Company Limited who are insurers of M/V Reg. KBP 861K . The appellants being aggrieved by the judgment in Kithimani Civil Suit No. 199 of 2017 that was entered against them on May 19, 2021, they filed an appeal that they believe they have high chances of success. The respondent may levy distress against them rendering the Appeal nugatory. That the respondent will more likely execute the said judgment and Insurer be made to pay the decretal sum on behalf of the applicant to the respondent. In such an event they would suffer substantial irreparable and irredeemable loss. They are willing to furnish the court with a Bank Guarantee from DTB Bank. The respondent is a man of no means and if the judgment sum is executed in light of the Appeal it will be hard to recover Kshs.743,605/- plus costs.

Respondent’s Replying Affidavit 4. Therespondent filed replying affidavit datedJuly 27, 2021in which he deposed as follows:a.That the Application is defective for being in violation of the provisions of Order 19 rule 3(1) of CPR 2010 as the Supporting Affidavit is sworn by a person who is not a party to the suit.b.That the Memorandum of Appeal does not raise serious issues to be considered by this court for reasons that the judgment by the Learned Magistrate on both liability and quantum was well reasoned based on the evidence produced by both parties herein.c.That Order 42, rule 6 of the Civil procedure Rulesstates that no Appeal operates as a stay of execution or proceedings under a decree or Order appealed, except when the court finds it is reasonable to do so.d.That the applicants/appellants have not demonstrated any intention of prosecution of the Appeal since there is no evidence of any attempt to apply for copies of proceedings to commence the process of filing an appeal and it only shows that the applicants/appellants application is only meant to derail the respondent from enjoying his fruits of justice.e.That the Bank Guarantee the applicants/appellants are willing to furnish expires onDecember 6, 2021and there is no guarantee that the same will be renewed since the period within which the intended Appeal will be heard and determined is not definite.f.That in the draft Memorandum of Appeal the applicant/appellants herein are only dissatisfied with the quantum awarded to the respondent as the issue of liability is uncontested.

Appellants/Applicant Submissions 5. The applicants/appellants submitted unless stay of execution of the judgment dated 19/05/2021 is granted they stand to suffer irreparable loss as the decretal sum involved herein is Kshs.700,000/-; that they have an arguable appeal with high chances of success and therefore is stay of execution is not granted hence the said appeal rendered nugatory.

6. The issues arising for determination before this court are:1. Whether the appellant has an arguable Appeal.2. Whether substantial loss would emerge from refusal to grant stay.3. Whether the applicants are ready and willing to furnish security4. Whether the application was done without unreasonable delay.

7. On the issue of whether the applicant/appellant has an arguable appeal it was submitted that the Appeal was filed on 18/06/2021 within the lower court stay period; that the Appeal is mainly on quantum as an excessive award was made which is not proportionate to the evidence that was tabled before court and the injuries suffered herein hence it is arguable.

8. The Court of Appeal In the case of Kenya Revenue Authority v Sidney Keitany Changole & 3others [2015] eKLR the court held that;“This court has further held that the applicant need only prove or establish one arguable point noting that an arguable appeal is not necessarily one that will succeed but one that is not frivolous.”

9. That the principles governing exercise of the judicial discretion are;a.There are no limits or restriction on the judge’s discretion,b.The discretion is intended so to be exercised to avoid injustice.

10. On the issue of whether substantial loss will occur from refusal to grant stay it was submitted that in theiraffidavit filed herein it stated that the respondent’s means are unknown and it is highly unlikely that the respondent will not be capable of refunding the decretal amount in the event the applicants appeal succeeds.

11. Reference is made in the case ofNational Industrial Credit Bank limited v Aquinas Francis Wasike, Court of Appeal Civil Application No 238 of 2005 where the Court of Appeal held as follows:-“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.”

12. On the issue of whether application was done without unreasonable delay it was submitted that the judgment was delivered on May 19, 2021 and Memorandum of Appeal within time on June 18, 2021which was well within the thirty (30) days initial stay of execution period hence the application for stay was brought without any unreasonable delay.

13. On the issue of whether the appellant are ready and willing to furnish security it was submitted that the Appellants is ready and willing to provide security in the form of a Bank Guarantee pending the hearing and determination of the Appeal.

14. In the case of Selestical limited v Global Development [2015] eKLR the court stated that;“In my view, the rules give the court unfettered discretion to issue any order as to preserve the subject matter pending the hearing of the Appeal. There is no doubt therefore that the court has powers to order such security for the due performance of decree or order, and that the appellant did not have to furnish such security upfront before arguing the application for stay pending appeal.”

15. It is finally submitted that an order of stay of execution pending appeal be issued as prayed in the application dated July 12, 2021and the costs of the Application abide by the outcome of the appeal.

16. Respondent opted to rely on their replying affidavit dated July 27, 2021and did not file Written Submissions.

Determination 17. The issue is whether stay of execution pending appeal should or should not be granted.

Substantial Loss 18. The applicant contends that if stay of execution is not granted, he is apprehensive that unless the respondent is stayed by orders of this court the respondent will swiftly move for execution of the judgment. The applicant is apprehensive that execution will render the Appeal nugatory. Therespondent/decree holder is a natural person whose means is unknown and not sure the amount maybe refunded in the event of a successful appeal and hence he will suffer irreparable loss.

Unreasonable Delay 19. The applicant filed appeal on 18/6/2021 and judgment was on 19/5 /2021 there has been no undue delay and the appeal is filed within the statutory timelines.

Furnish Security 20. The appellants/applicants are ready to furnish a reasonable security in the form of a bank guarantee from Diamond Trust Bank.

21. The applicant has pleaded that he is willing to offer any security as may be ordered by court.

Arguable Appeal 22. Appellants/Applicants have an arguable Appeal with a high chance of success. As to what constitutes an arguable appeal, the Court of Appeal in Nairobi Women’s Hospital v Purity Kemunto[2018] eKLR stated;“To say that an appeal is arguable is another way of saying that it is not frivolous and that it raises a bona fide issue deserving full consideration by the court. Even one bona fide issue will satisfy the requirement, for the law does not look for a multiplicity of arguable issues.”

23. 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”.

24. The applicant/appellant has legal right to lodge an appeal to be determined on merit. Order 42 rule 6 CPR 2010, prescribes the conditions of stay which have been complied with save for furnishing of security.

Disposition1. The decretal amount is Ksh 743,605/- so as not to render the appeal nugatory or occasion substantial loss the court orders security of Ksh 200,000/- to be paid to the respondent within 90 days through respondents advocate on record.2. Thereafter, stay of execution shall be granted; and3. The Appellant to file record of Appeal.4. Deputy Registrar Machakos High Court to obtain the Lower Court File.5. Further Mention on Directions shall be on 7/10/2022.

DELIVERED SIGNED & DATED IN OPEN COURT IN MACHAKOS ON 12TH JULY, 2022 (VIRTUAL CONFERENCE).M.W. MUIGAIJUDGE