LULE AUTOSPARES LIMITED vs RIFT VALLEY AGRICULTURAL CONTRACTORS LTD [2004] KEHC 2251 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT NAKURU CIVIL APPEAL NO. 45 OF 2004

LULE AUTOSPARES LIMITED…………………………………………..APPELLANT

VERSUS

RIFT VALLEY AGRICULTURAL CONTRACTORS LTD………….…RESPONDENT

RULING

The appellant filed an application by way of a Notice of Motion dated 22nd March, 2004 brought under Order XLI Rule 4 and Order L Rule 1 of the Civil Procedure Rules. He prayed that execution of the ruling and order of the Senior Resident Magistrate delivered on 19th February, 2004 in CMCC No. 270 of 2004 be stayed pending the hearing and determination of the appeal. The application was supported by an affidavit sworn by the appellant’s advocate, Mr. Paschal Peter Oyuko Mbeche and its was made on the grounds that the ruling determined the whole suit before the court and that the import of the ruling was to condemn the appellant before he was heard.

The respondent filed grounds of opposition dated 29th March, 2004 as well as a replying affidavit sworn by Mr. Benson Thiru Karanja, the Managing Director of the respondent. The appellant filed its appeal on 22nd March, 2004 and the first ground of appeal is regarding pecuniary jurisdiction of the subordinate court which gave the ruling which is the subject matter of this appeal as it is claimed in the appeal that the magistrate did not have such jurisdiction. The genesis of the original suit was an agreement entered into between the parties on 8th April, 2002 whereby the respondent agreed to hire out to the appellant two earth moving equipment for a period of seven months. It was a term of the said agreement that upon completion of the said period or the project for which the appellant was hiring the said equipment, the appellant would return the same to the respondent’s yard at Nakuru. The above facts were not denied by the appellant. The hire charges were agreed at Kshs.2000/- per hour and during the hire period, the hirer (appellant) was to maintain and keep the graders in good working condition and was obligated to consult the respondent for any want of repair. The third clause of the said agreement provided that the respondent was to reimburse the appellant any maintenance expenses incurred provided that such expense was vouched for by the respondent or its representative and consent to incur the expense had been given by the respondent.

On 5th February, 2004 the respondent filed suit in the Chief Magistrate’s court as against the appellant praying for a declaration that the retention of the said equipment after the expiry of the agreement dated 8th April, 2002 was unlawful and also sought damages for conversion and costs of the suit.

Together with the plaint the respondent also filed a chamber summons where it prayed that it be allowed to repossess the two earth moving machines among other prayers. Interim orders as prayed for were granted and the matter was heard inter partes on 13th February, 2004. On 19th February, 2004 the court made an order that the two machines be released to the appellant who was to return them to the respondent within 30 days from the aforesaid date in working condition. This order is now the subject of the appeal.

On 27th February, 2004 the appellant filed a statement of defence and counter claim, albeit under protest. It claimed a sum of Kshs.2,493,653/- for purchase of spares and auto parts for the two machines as well as a Land Rover, Motor Lorry and labour charges. I have carefully considered all the submissions made by counsel and perused all the relevant documents on record. From the contents of paragraph 7 of the appellant’s statement of defence which was filed after the ruling now appealed against, the main reason why the appellant wants to be allowed to retain the two earth moving equipment is to enable it recover the expenses which it has allegedly incurred in putting the machines to a working condition. That amount is not specified. The sum of Kshs.2,493,635/- which is claimed in the counter-claim includes those repair expenses as well as other expenses for purchase of spares for Land Rov4er, Motor Lorry and labour charges. However, the contract between the parties clearly indicated that the appellant was not to incur any expenses in repairing the two machines without express consent and agreement on the amount by the respondent, a condition which does not seem to have been adhered to by the appellant. The appellant has already filed suit against the respondent to reoccur those expenses. This is by way of its counter-claim. Can it then rightly continue to hold the two machines on account of those expenses even when it has not claimed to be holding the same on account of any right of lien? I do not think so. The court cannot force the parties to remain in the contract if the same has been breached by the appellant. My view is that the appellant has not shown that he will suffer substantial loss if the orders of stay sought are not granted. He has not shown any evidence of any contract which is likely to be lost if the order of stay is refused. Substantial loss is the corner stone for granting an order of stay of execution pending appeal and an applicant should not spare any effort to convince the court by way of presenting appropriate material and/or evidence that would go to prove that crucial issue. I am not therefore inclined to grant the prayer for stay of execution.

Regarding the issue of the lower court’s jurisdiction in making the orders it did, that is the main ground of appeal and I can not make any determination of it at this stage as that would be prejudicial to the appellate proceedings. However, it is in the interests of both parties that this matter be resolved as soon as possible and so I direct that the appeal be listed down for hearing within the next forty five days from the date hereof. The appellant should take the appropriate steps to get the appeal ready for hearing within that period.

The end result is that the appellant’s application dated 22nd March, 2004 is dismissed with costs.

DATED, SIGNED and DELIVERED at Nakuru this 21st day of April, 2004.

DANIEL K. MUSINGA

AG. JUDGE

21/4/04