Kahuthu and Kahuthu Advocates v Karuga & another [2023] KEELC 20426 (KLR)

Kahuthu and Kahuthu Advocates v Karuga & another (Miscellaneous Application 133 of 2019) [2023] KEELC 20426 (KLR) (26 September 2023) (Ruling)

Neutral citation: [2023] KEELC 20426 (KLR)

Republic of Kenya

In the Environment and Land Court at Nairobi

Miscellaneous Application 133 of 2019

MD Mwangi, J

September 26, 2023

Between

Kahuthu and Kahuthu Advocates

Advocate

and

Rose Wambui Karuga

1st Respondent

Kenneth Gichinga Karuga

2nd Respondent

(In respect of the Respondents/ Judgement-Debtors Application dated 3rd July, 2023 seeking payment of the decretal amount by installments)

Ruling

Background 1. The application before me is a Notice of Motion dated 3rd July, 2023 brought under the provisions of order 21 rule 12 (1) and (2), order 22 rule 25 and order 51 rule 1 of the Civil Procedure Rules, 2010. The Applicants pray for orders that they be allowed to pay the decretal amount by way of installments.

2. The application is premised on the grounds on the face of it and is supported by an affidavit sworn by Rose Wambui Karuga deponed on the 3rd July, 2023. The deponent avers that the Advocate was awarded a sum of Kshs. 991,273. 56/= plus costs. The Applicants however are under intense financial constraints and are therefore not in a position to settle the entire Decretal sum in one instalment.

3. The Applicants aver that the application is not in any way intended to deprive the Decree-holder the fruits of his judgement as the Applicants are ready and willing to pay the decretal amount plus the costs awarded. They pray that the court allows them to pay in monthly installments of Kshs. 50,000/= to be paid on or before the 5th day of each month starting August 2023 until payment in full.

4. The deponent further avers that the application has been made timeously and in good faith with a view to not only ensure that the Decree-holder receives and enjoys the fruits of his judgement but to also enable the Applicants the chance to settle the amount as due.

Replying Affidavits 5. The application is opposed by the Advocate who filed two Replying Affidavits; the first one is deponed by the Advocate G.J. Kahuthu and the other by Joseph Nderitu, the Auctioneer, both sworn on 18th July, 2023. The Advocate avers that the application is fatally defective, untruthful, vexatious and an abuse of court process. He states that as at 16th June, 2023, the decretal amount was Kshs. 1,149, 277. 34 as shown on the Warrant of Attachment. The Judgement-debtors live in Karen and that they have been hiding the earlier proclaimed vehicle, KBD 560K with a view to selling it to defeat the execution process.

6. Further, that the Judgement-debtor paid a paltry sum of Kshs. 100,000/= to his Mpesa account on 14th July, 2023 without consulting him. However, and in spite of that payment, a balance of Kshs. 1,049,277. 34/= is still outstanding as at 16th June, 2023. Counsel further avers that he has not been briefed by the auctioneer to what extent he has gone with the sale of the attached goods.

7. The Auctioneer on the other hand avers that he attached the Judgement-Debtor’s goods. He advertised the attached goods for sale as shown in the Letter dated 28th June, 2023 and the Warrant of Attachment dated 13th July, 2023. The Judgement-Debtor has however, been hiding the Motor Vehicle KBD 560K which was proclaimed and is trying to sell it secretly with the intention of defeating the execution.

Supplementary Affidavit 8. The Applicants filed a Supplementary Affidavit deposed by Rose Wambui Karuga on the 24th July, 2023. She deposes that the household items that were seized by Jogen Dries Auctioneers on 27th June, 2023 were sold on 20th July, 2023 in partial execution of the Judgement debt. That the amount referred to in the application by the Advocate was the initial decretal amount given in the Judgement.

9. She further avers that as a show of their good faith and commitment to settle the decretal sum, the Applicants deposited a sum of Kshs. 100,000/= with the Advocate and a further sum of Kshs. 30,000/= to the Auctioneer.

10. She denies hiding the proclaimed Motor vehicle and states that the Motor Vehicle is still parked in her garage. In any event, the Motor Vehicle belongs to one, Hilda Nyokabi who inherited it from her late father. The application having been made in good faith and in order to ensure that the decretal amount is paid, it is in the interest of justice that the court allows them to pay the decretal amount in installments.

Further Replying Affidavit 11. The Advocate, G.J. Kahuthu and the Auctioneer, Joseph Nderitu filed Further Replying Affidavits both deponed on the 18th August, 2023 in response to the Supplementary Affidavit of the Applicants. The Advocate avers that the Judgement debtor has only made a total payment of Kshs. 133,740/= leaving a balance of Kshs.1 015, 537/= unpaid which equally continues to attracts interest.

12. The Auctioneer, Joseph Nderitu, confirms that the Applicants paid Kshs. 100,000/= through Mpesa. He further confirms receipt of Kshs. 50,000/= through Mpesa being part of the Auctioneer’s fees as per the proclamation dated 5th October, 2022.

13. He further deposes that the goods sold at the Public Auction on 20th July, 2023 realized a sum of Kshs. 78, 600/= only. The Kshs. 33, 740/= was forwarded to the Advocates after deduction of part of the auctioneer’s costs.

Court’s direction 14. The court directed that the application be canvassed by way of written submissions. The Judgement-Debtors filed their submissions on 25th July, 2023. However, the Advocate did not file any submissions.

Issues for Determination 15. I have carefully considered the application and the response by the Advocate as well as the submissions by the Judgement-Debtors. The sole issue for determination in this matter is whether the Applicants should be allowed to pay the decretal amount by installments as proposed.

Analysis and determination 16. The applicable provision of the law in respect of an application of this nature is order 21 rule 12 of the Civil Procedure Rules (2010). The rule provides that;“(1)Where and in so far as a decree is for the payment of money, the court may for any sufficient reason at the time of passing the decree order that payment of the amount decreed shall be postponed or shall be made by instalments, with or without interest, notwithstanding anything contained in the contract under which the money is payable.(2)After passing of any such decree, the court may on the application of the judgment debtor and with the consent of the decree- holder or without the consent of the decree holder for sufficient cause shown, order that the payment of the amount decreed be postponed or be made by instalments on such terms as to the payment of interest, the attachment of the property of the judgment-debtor or the taking of security from him, or otherwise, as it thinks fit.”

17. It is clear that the court has the discretion to allow payment of the decreed amount by installments where sufficient cause has been shown by an Applicant. The discretion being judicial discretion must at all times be exercised judicially and in the interest of justice. It is incumbent upon the Applicant therefore to show sufficient cause in order to benefit from the discretion of this court.

18. The Applicable principles for the grant of orders as sought by the Applicant herein were set out in the case of Botanics Kenya Ltd v Ensign Food (K) LTD (1959) as follows: -a.The circumstances under which the debt was contracted(b)The conduct of the debtor(c)His financial position(d)His bona fides in offering to pay a fair proportion of the debt at once.

19. In the case of Freight Forwarders Ltd v Elsek & Elsek (K) Ltd (2012) eKLR, the court defined what amounts to ‘sufficient cause’ to include the following;a.the debtor is unable to pay in lump sumb.the debtor can pay by reasonable monthly installmentsc.the application is made in utmost good faith

20. In an earlier decision in the case of Keshvaji Jethabhai & Bros Limited v Saleh Abdulla [1959] EA 260, the court had restated the principles that should guide the court in exercising its discretion as hereunder:a.Whilst creditors’ rights must be considered each case must be considered on its own merits and discretion exercised accordingly;b.The mere inability of a debtor to pay in full at once is not a sufficient reason for exercise of the discretion;c.The debtor should be required to show his bona fides by arranging prompt payment of a fair proportion;d.Hardship of the debtor might be a factor, but it is a question in each case whether some indulgence can fairly be given to the debtor without prejudicing the creditor.

21. From the above cited authorities, the burden is upon the Applicant to show that he/she is entitled to indulgence under order 21 rule 12 of the Civil Procedure Rules

22. In the instant suit, Judgement was entered in favour of the Advocate for the sum of Kshs. 991,273. 56/= plus costs on the 14th February, 2022. As at 16th June, 2023, the decretal amount had accrued interest and the outstanding amount was Kshs. 1,149,277. 34/=. The Advocate avers that the Judgement debtor has only made a total payment of Kshs. 133,740/= leaving a balance of Kshs. 1,015, 537/= unpaid which continues to attract interest.

23. The Applicants on the other hand aver that they are under intense financial constraints and are therefore not in a position to settle the entire Decretal sum in one instalment. That the application is no way intended to deprive the Decree-holder the fruits of its judgement as the Applicants are ready and willing to pay the decretal amount plus costs awarded but pray that the court allows them to pay in installments. They propose that they be allowed to pay a sum of Kshs. 50,000/= monthly starting August 2023 until payment in full.

24. The decree holder disagrees with the proposal to pay the decretal sum by instalments and prays that the application be dismissed.

25. From the authorities cited above, it is clear that each case must be considered on its own merits and the mere fact of inability to pay the full sum at once is not a sufficient reason on its own. It must be considered that the Judgement herein arose from the Advocate’s representation of the Applicants in a 2008 case. From the Ruling of the Taxing Master, the costs were incurred between December 2010 and November, 2018.

26. Judgement herein was entered on 14th February, 2022 and a Decree issued in April, 2022. The Applicants have not made noticeable efforts to pay the amount owing save for the Kshs. 100,000/= paid and the proceeds of sale of the attached household goods. The payment of Kshs. 100,000/- was only effected after execution of the decree was commenced.

27. Whilst the court considers the financial hardship of the debtors as a factor in making its determination, it is also bound to weigh the same against the legitimate interests of the decree holder who holds a lawful decree of this court in his hands and is entitled to the fruits of his judgment. It is a delicate balancing act.

28. This court, having carefully considered the plea by the Judgement- Debtors and considering the circumstances of this case allows the application conditionally and makes the following orders;a.That the Respondent/ Judgement- Debtors to pay 40% of the balance of the decretal amount to the Advocate/Decree Holder on or before the 31st October, 2023. b.Thereafter, to pay the remaining balance of the decretal amount in equal monthly installments of Kshs. 50,000/= payable on or before the 5th day of each month starting 5th December, 2023 until payment in full.c.In case of default on any one instalment, the decree holder will be at liberty to execute for the outstanding balance without any further reference to this court.d.The costs of this Application be borne by the Applicants.

It is so ordered.

RULING DATED, SIGNED & DELIVERED VIRTUALLY AT NAIROBI THIS 26TH DAY OF SEPTEMBER, 2023. M. D MWANGIJUDGEIn the virtual presence of:Mr. Kahuthu for the Advocate/RespondentNo appearance for the clients/ApplicantsYvette: Court Assistant.M. D MWANGIJUDGE