Mbungu & another v Aakash Limited [2024] KEHC 10952 (KLR)

Mbungu & another v Aakash Limited (Miscellaneous Civil Application E030 of 2024) [2024] KEHC 10952 (KLR) (19 September 2024) (Ruling)

Neutral citation: [2024] KEHC 10952 (KLR)

Republic of Kenya

In the High Court at Meru

Miscellaneous Civil Application E030 of 2024

EM Muriithi, J

September 19, 2024

Between

Jasper Ireri Mbungu

Applicant

and

Jasir Contractors Limited

Defendant

and

Aakash Limited

Respondent

Ruling

1. By a Notice of Motion under certificate of urgency dated 15/2/2024, brought under Sections 38 and 42 of the Civil Procedure Act, section 11 of the International Convention on Civil and Political Rights (ICCPR), Order 22 Rules 33, 34 and 35 of the Civil Procedure Rules and all other enabling provisions of the law, the applicant seeks:1. Spent2. Spent3. That an order be and is hereby issued by the Honorable Court reviewing and/or setting aside the order by the Meru Chief Magistrate’s Court (Honorable Evalyne Wacera Ndegwa (SRM) issued on the 13th day of February, 2024, and in its part direct that the due process laid down in law be followed before such drastic orders are granted.4. That declaration be and is hereby made that since the Applicant had served his civil jail term and the Respondent failed to make an application for extension of the same neither did they make provision for subsistence to the prison authority, the said Applicant has served his civil jail term and cannot be re-arrested on account of the same facts.5. That the costs of the application be provided.

2. The grounds upon which the application is premised are set out in the body of the application and supporting affidavit of Jaspher Ireri Mbungu, the applicant herein sworn on even date. He contends that he was condemned to pay the respondent Ksh. 1,896,396 together with costs and interest vide the judgment of 7/10/2020. Being one of the directors of the 1st defendant, he endevoured to pay to the respondent a total of Ksh. 420,000 in partial fulfillment of the outstanding decretal amount. The 1st defendant being the principal judgment debtor herein has been having financial challenges which he adequately explained to the respondent to no avail. He was roped in this matter as a defendant, the doctrine of corporate veil notwithstanding and he has been advised by his counsel that there ought to be a formal application to lift the corporate veil before being made personally liable to pay the debts of the 1st defendant. He was served with a notice to show cause and when he appeared in court on 7/12/2023 to explain his predicament, he was committed to civil jail for 30 days. His efforts to try and mitigate the situation with the respondent did not yield any fruit and he was forced to serve the full term in jail. While he was in jail, no formal application to extend his jail term was made neither did the respondent make payment for subsistence to the prison authorities. When the matter was mentioned on 5/1/2024, he was unconditionally released from prison and the matter was due for mention on 13/2/2024. On that day, he appeared in court through his advocate but the trial court issued a warrant of his arrest and directed the OCS Meru Police Station to execute the arrest. Having been released from prison on 5/1/2024, no notice contemplated under Order 22 Rule 31 of the Civil Procedure Rules was served upon him neither did he receive a letter of arrest as contemplated under Order 22 Rule 34 of the Rules. Contrary to the dictates of Order 22 Rule 33 (1) of the Civil Procedure Rules, an order for his arrest was issued without the respondent first depositing the subsistence money in court. He is advised by counsel that no provision of either the Civil Procedure Act or Civil Procedure Rules deal with re-arrest of a judgment debtor who has already served part or full jail term and as such the extension being mooted by the trial court and the respondent should have been made at the time he was serving his civil jail term. He avers that mere sojourn of poverty upon his door or poor business prospects cannot be the basis for his committal to civil jail.

3. The respondent opposed the application vide a replying affidavit sworn by Dipak Kara, its director on 15/3/2024. After the 1st defendant neglected to settle the decretal sum of Ksh. 1,896,396 and instead hid all its assets with the applicant, the respondent was prompted to make an application to lift the corporate veil, which was allowed. The applicant is thus misleading the court by claiming that he is not personally liable to the debts of the 1st defendant. Even after the corporate veil was lifted, the applicant made no attempts to settle the decretal sum prompting his advocate to levy execution against him by issuing a Notice to Show Cause. The applicant failed to appear in court on 18/7/2023 as required and a warrant of his arrest was duly issued. The applicant, apprehensive of his impeding arrest, appeared in court and paid Ksh. 420,000 and proposed to pay the remainder of the decretal sum in monthly installments of Ksh. 75,000, which proposal the court approved, on condition that, in the event of default, warrants of arrest would be issued. The applicant, in blatant violation of the court orders, failed to make any payments thereafter, which led to the execution of warrants of arrest earlier issued against him for the outstanding balance and accrued interest of Ksh. 2,796,798. The applicant was arrested and committed to civil jail for one month, and released on 5/1/2024 on condition that he initiates payment of the balance of the decretal sum. No payments had been made by the applicant as at 13/2/2024 when the matter was mentioned and the trial court issued warrants of arrest against the applicant. The applicant’s claim that he cannot be re-arrested is misguided as he has not continuously or actively been in civil jail for 6 months and thus cannot be said to have been discharged from his debt. The allegation that the applicant is unable to pay the decretal sum is untenable because he had earlier proposed to settle the same by monthly installments of Ksh. 75,000. The application thus lacks good faith as the applicant is a dishonest and fraudulent debtor who is liable to be punished by way of arrest and committal to civil jail. The applicant is determined to thwart his successful claim and deprive him of the chance to relish the benefits of the judgment in his favour, and he urges the court to dismiss the application with costs.

Submissions 4. The applicant urges that the threshold for a regular warrant of arrest against a judgment debtor as set forth under section 38 of the Civil Procedure Act is coached in mandatory terms that before a court issues it, the same should be preceded by a Notice to Show Cause why they should not be committed to prison, and cites Innocent Ondieki v Julius Nakaya Kabole (2019) eKLR. He faults the trial court for disregarding the procedure well laid out above and relying on the provisions of Order 22 Rule 34 of the Civil Procedure Rules, which provide for appearance of a judgment debtor in obedience to a notice or a letter of arrest. He urges that it was incumbent upon the judgment creditor to apply for extension of the committal period and to pay for subsistence as mandated by the provisions of Section 42 of the Civil Procedure Act. He urges that he served the entire committal period and he was subsequently released by an order of the trial court on 5/1/2024 and since no application for extension had been sought and no payment of the mandatory subsistence to the prison authorities had been made, he is not liable to be rearrested under the decree in execution of which he was detained.

5. The respondent urges that the decree issued herein still remains in force, and the applicant is obligated to settle it, and cites Trusted Society of Human Rights Alliance v Cabinet Secretary for Devolution & Planning & 3 Others [2017] eKLR, Econet Wireless Kenya Ltd v Minister for Information & Communication of Kenya & Another [2005] 1 KLR 828, Awadh v Mambu (No. 2) No. 53 of 2004 [2004] KLR 458, B v Attorney General [2004] 1 KLR 431 and Machira T/A Machira & Co. Advocates v East African Standard (No 2) [2002] KLR 63. It faults the applicant for failing to satisfy the conditions for review under Order 45 of the Civil Procedure Rules, and cites Francis Njoroge v Stephen Maina Kamore [2018] eKLR. It prays for the dismissal of the application with costs, so that it can enjoy the fruits of its judgment.

Analysis and Determination 6. The issue for determination is whether application is merited.

7. The applicant is adamant that no provisions of either the Civil Procedure Act or Civil Procedure Rules deal with re-arrest of a judgment debtor who has already served part or the full jail terms.

8. In its ruling of 13/2/2024, the trial court rendered thus;“My opinion is that a Judgment Debtor can be re-arrested even after his release from civil jail and be committed again to civil jail, unless he has continuously/actively been in civil jail for (6) months. No proposal that the payment of the decretal sum has been made by the Judgment Debtor. The Judgment Creditor is willing to pay the Judgment Debtors subsistence for that reason. I issue Warrant of arrest against the Judgment Debtor in execution of the decree. The Officer Commanding Station Meru Police Station to execute.”

9. Arrest and detention in prison of a judgment debtor is one of the modes of execution of a decree provided under Section 38 of the Civil Procedure Act. Section 42 of the Act provides that;“(1)Every person detained in prison in execution of a decree shall be so detained— (a) where the decree is for the payment of a sum of money exceeding one hundred shillings, for a period not exceeding six months; and (b) in any other case, for a period not exceeding six weeks: Provided that he shall be released from such detention before the expiration of the said period of six months or six weeks, as the case may be— (i) on the amount mentioned in the warrant for his detention being paid to the officer in charge of the prison; or (ii) on the decree against him being otherwise fully satisfied, if the court so orders; or (iii) on the request of the person on whose application he has been so detained, if the court so orders; or (iv) on the omission of the person, on whose application he has been so detained, to pay subsistence allowance. (2) A judgment-debtor released from detention under this section shall not merely by reason of his release be discharged from his debt, but he shall not be liable to be rearrested under the decree in execution of which he was detained in prison.”

10. The law is crystal clear that although the release of the judgment debtor from prison does not absolve him from satisfying the decree, he shall not be liable to be rearrested in execution under the same decree of which he was detained in prison.

11. The applicant was in the first instance arrested and committed to civil jail for a period of 30 days, and subsequently released on 5/1/2024. The applicant cannot, therefore, be lawfully rearrested and re-committed to civil jail in execution of this decree.

12. The respondent is at liberty to pursue other modes of execution as enlisted under Section 38 of the Civil Procedure Act, save for the mode herein preferred.

OrdersPARA 13. Accordingly, for the reasons set out above, this court invokes its supervisory jurisdiction under Article 163 (6) and (7) of the Constitution and allows the application dated 15/2/2024 in terms of prayer 4 thereof.PARA 14. There shall be no order as to costs.Order accordingly.

DATED AND DELIVERED THIS 19TH DAY OF SEPTEMBER, 2024. EDWARD M. MURIITHIJUDGEAppearancesMr. Omondi for the Applicant.Ms. Wambulwa for Mr. Gichunge for the Respondent.