G4s Kenya Limited v Belle Africa Tours and Travel Limited [2017] KEHC 1219 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT NAIROBI

CIVIL APPEAL  NO. 566  OF 2017

G4S KENYA LIMITED...........................................................APPELLANT

-V E R S U S –

BELLE AFRICA TOURS AND TRAVEL LIMITED...........RESPONDENT

RULING

1. The subject matter of this ruling is the motion dated 23rd October 2017 taken out by G4S Kenya Ltd, the appellant in which it sought for inter alia, an order for stay of execution of the order of Hon. G. A. Mmasi, learned Senior Principal Magistrate made on 20th September 2017 vide Nairobi C.M.C.C. no. 3647 of 2017.  The motion is supported by the affidavit of Alvar Lawrence Okelo sworn on 23rd October 2017 and a further affidavit also sworn by the same deponent.

2. When served with the motion, Belle Africa Tours and Travel Ltd, the respondent herein, filed the replying affidavit of Titus Kigo Koigi, to oppose the application.  When the motion came up for interpartres hearing, learned counsels were invited to make oral submissions.

3. I  have considered the grounds stated on the face of the motion and the facts deponed in the affidavits filed in support and against the application.  I have further considered the rival  oral submissions of learned counsels.  The history of this dispute can be discerned from the material placed before this court.  The parties to this dispute executed a written agreement titled “Transport Services Agreement.”  In the aforesaid agreement, the respondent agreed to provide the appellant with motor vehicles for the provision of transport services.  The agreement is dated 1st February 2015 and was to last for 2 years  with an option of renewal.  The aforesaid agreement expired on 31st January 2017. Pursuant to the aforementioned agreement it would appear the respondent supplied the appellant motor vehicles registration numbers inter alia: KCJ 793J, KCG 981Y, KBL 874H, KBV 927L, KBS 930X, KBR 389X and KBU 920C.

4. It is the submission of the appellant that it contracted the services of the respondent for the vehicles it required from time to time on a monthly basis in terms of the monthly local purchase orders issued to the respondent.  The appellant is of the submission that those local purchase orders bore no relation to and were at all times unrelated to the terms and conditions of the agreement which lapsed on 31st January 2017. The respondent on the other hand is of the view that the agreement was orally renewed and that the local purchase order was used before, during and after the renewal of the agreement as a mode of processing the monthly payments for transport services.

5. Sometimes in the month of March 2017, the applicant avers that it contracted the services of Holiday Car Hire Ltd, to provide transport services which company begun to transport services to the appellant with effect from 1st April 2017.  By a letter dated 17. 5.2017, the appellant informed the respondent of its intention to cease issuing further monthly local purchase orders from June 2017.  The aforesaid letter prompted the respondent to file the suit before the Chief  Magistrate’s Court i.e. Nairobi C.M.C.C. No. 3647 of 2017 claiming there was a breach of contract.  The respondent successfully obtained temporary orders of injunction to restrain the appellant from breaching the contract by terminating the contract for the provision of transport services pending the hearing and determination of the suit.  The appellant being aggrieved by the order of injunction, it preferred this appeal.

6. Having outlined the background of this dispute in detail, let me now consider the merits or otherwise of the motion.  I have already stated that the appellant is before this court seeking for a temporary order of stay pending appeal.  The appeal is an appeal against an interlocutory order of injunction.  The appellant has argued that it has an arguable appeal, in that it will be in a position to show on appeal that the learned Senior Principal Magistrate erred when she made conclusive findings which are to the effect that the contract was orally renewed yet the case is yet to be heard. At this stage this court is barred from making conclusive finding before hearing the substantive appeal.  What I can only state is that the appeal is not frivolous.

7. The principles to be considered in determining an application for stay are well stated in Order 42 rule 6 of the Civil Procedure Rules.  First, an applicant must show that unless the order for stay is granted it would suffer substantial loss.

Secondly, that the application for stay must be filed without unreasonable delay.

Thirdly, that the provision of security for the due performance of the decree and or order should  be made.

8. There is no doubt that the motion was timeoulsy filed. The question which must be determined is whether or not the appellant/applicant has shown the substantial loss it would suffer if the order for stay is denied. It is the submission of the appellant that the respondent served it with the order issued on 20. 9.2017 with a penal notice and unless the order for stay of the order is made, it would suffer substantial loss and irreparable damage which will not only be limited to financial loss but would render this appeal nugatory.  In other words unless the order for stay is given the appellant may be cited for contempt of the trial court’s order for injunction.  The respondent on the other hand is of the view that if the order for stay is given the respondent will be the most affected party in that the failure by the appellant to pay for the services rendered has caused the respondent to suffer damages and loss as the financial institution which gave loans for the purchase of the vehicles have made several demands for the loan repayment hence the increase of interest since the  loan is not being serviced.

9. Having considered the divergent arguments by the parties herein, I am persuaded by the appellant’s submission that  it may suffer substantial loss if the order for stay is denied.  The appellant may be cited for contempt and its property may be sequestrated if the order for stay is denied.  It is clear in  my mind that the question as to whether or not the contract was orally renewed is yet to be answered in a substantive trial before the trial court.

10. The other principle is in respect of the provision of security for the due performance of the decree/order.  The appellant/ applicant did not address this court over the principle and neither did the respondent did.  This court is of course enjoined by law to make orders providing for security for the due performance of the decree/order.  It should be appreciated that what provoked the respondent to  institute the suit before the trial court is the letter written by the appellant to the respondent dated 17. 5.2017 in which the appellant informed the respondent of its intention to cease issuing further local purchase orders from June 2017.  In the circumstances of this case it is difficult to determine and ascertain the sort of security which is appropriate for the applicant to provide.  The respondent has merely stated that it would suffer more as compared to the appellant but has totally failed to suggest what kind of security this court should  make to ameliorate its losses of suffering.  In the circumstances of this appeal, I think it is not necessary to make an order directing any party to provide security for the due performance of the order or decree. I am convinced that the most appropriate order is to make directions which are geared towards the expeditious disposal of this interlocutory appeal.

11. In the end prayer 3 of the motion dated 23rd  October 2017 is allowed.  Costs of the motion to bide the outcome of this appeal. 12) This court further makes the following directions: The appellant is directed to take the necessary steps to have this appeal ready for hearing within 21 days.

The Deputy Registrar is directed to liaise with the Executive Officer of the trial court to have the proceedings of the trial court typed and forwarded to this court and supplied to the parties within 21 days.  This appeal to be mentioned on 7. 12. 2017 for admission and for fixing a hearing date.

Dated, Signed and Delivered in open court this 14th day of November, 2017.

J. K. SERGON

JUDGE

In the presence of:

....................................................  for the Appellant

..................................................... for the Respondent