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Court of AppealPartially AllowedCivil Appeal 70 of 1982· [1983] KECA 110 (KLR)

INDUSTRIAL & COMMERCIAL DEVELOPMENT CORPORATION vs J.KEMUMA ONYANGO & 3 OTHERS [1983] KECA 110 (KLR)

Court of Appeal
18 May 1983
1,920 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Court of Appeal ruled that judgment debtors get no advance notice before their movable property is auctioned to settle a debt.

What this practically means

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Executive summary

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The Industrial and Commercial Development Corporation appealed against a ruling of Chesoni J of the High Court at Nairobi of August 19, 1982, which had granted the respondents (trading as the Friends Bakery) an ex parte vacation application under rule 3(2) of the High Court (Practice and Procedure) Rules, Section 3A of the Civil Procedure Act and Order XXI rule 25, including a stay of execution of a decree for Kshs 164,835.35 obtained by default judgment. The respondents had admitted liability and not challenged the decree. Kneller JA, delivering the leading judgment with which Simpson CJ and Potter JA agreed, held the ex parte stay unjustified because the judge could instead have adjourned the auction under Order XXI rule 63 to allow the decree-holder to be served and an early inter partes hearing fixed. The inherent jurisdiction recognised in the Siqueira Facho and Ujagar Singh authorities existed but had no grounds for invocation here; Order XXI rule 25 was wrongly cited as it applies only where the decree-holder is a defendant in another pending suit. The court held that the Civil Procedure Act and Rules do not require notice to a judgment debtor before attachment and sale of movable property where personal liberty is not at stake, the safeguards being the right to tender the decretal sum before sale and the remedy under Order XXI rule 69 for injury from irregularities. The appeal was allowed with costs; the respondents' prayer for payment by instalments had already fallen away for want of the appellant's consent.

Key legal issues

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01

Ex parte grant of stay of execution

Holding

The grant of a stay ex parte was unjustified; the judge could instead have adjourned the auction under Order XXI rule 63 to allow service on the decree-holder and an inter partes hearing.

Reasoning

Even if the application was made in Nairobi on August 19 and the auction was in Kisumu on August 20, the judge had power under Order XXI rule 63 to adjourn the sale to a date permitting service of the papers on the appellant in Nairobi and an early hearing. An ex parte stay was therefore unnecessary and unjustified; the inherent jurisdiction under Section 3A had no grounds for invocation on these facts.

p. 2
02

Proper statutory basis of the application

Holding

The summons was rightly brought under Section 3A of the Civil Procedure Act (not the 'Rules'), but Order XXI rule 25 was wrongly cited since it applies only where the decree-holder is a defendant in another pending suit; and there were no grounds to invoke the inherent jurisdiction.

Reasoning

Order XXI rule 25 governs stays where the decree-holder is a defendant in a pending suit in which the judgment debtor is plaintiff, which was not the case. The inherent power described in the older authorities existed, but no circumstances on these facts called for its exercise.

p. 3
03

Notice before execution against movable property

Holding

The Act and Rules do not require notice to the judgment debtor to show cause before attachment and sale of movable property, unlike execution against immovable property or arrest and detention in prison.

Reasoning

Notice is required for terms and conditions of sale of attached immovable property (Order XXI rules 60 and 61) and before arrest and detention in prison for a money decree (Section 38 and Order XXI rules 32, 35), but no provision requires notice for attachment of movable property. The decree-holder's protection lies in the judgment debtor's ability to tender the decretal sum before sale and the remedy under Order XXI rule 69 for injuries from irregularities.

p. 3
04

The High Court judge's view that every party must have notice of each step

Holding

Rejected. The safeguards for a judgment debtor faced with execution against movables are the right to tender payment before sale and the suit for compensation or recovery under Order XXI rule 69, not a general rule of notice at every stage.

Reasoning

The judge illustrated his view with a judgment debtor whose vehicle worth Kshs 300,000 is sold under a Kshs 2,000 decree, and one absent abroad at judgment but present at execution. Kneller JA held these concerns answered by the tender-before-sale mechanism and Order XXI rule 69 remedies rather than by any notice requirement.

p. 3

Legal principles established

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  • Where the decree is for payment of money and the liberty of the citizen is not threatened, the Civil Procedure Act and Rules do not require the judgment debtor to be given notice to show cause why his movable property is to be attached and sold in execution.
  • The court has an inherent power, ex debito justitiae, to order a stay of execution in appropriate circumstances even where no appeal is pending.
  • An ex parte stay of execution was unjustified where the sale could have been adjourned instead, giving the judgment debtor time to serve the decree-holder and fix an early inter partes hearing.
  • A sale of movable property in execution, though not vitiated by irregularity in publishing or conducting it, gives a person injured by the irregularity a suit for compensation or recovery of the property from the purchaser.
  • This Court's decision binds the High Court on the requirements of notice before execution against movable property.

Court orders

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  1. 1.Appeal allowed with costs to the appellant
On appeal from
High Court at Nairobi
Jurisdiction invoked
First appeal to the Court of Appeal against a ruling of the High Court (statutory appellate jurisdiction; no specific constitutional provision invoked in the judgment)

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "INDUSTRIAL & COMMERCIAL DEVELOPMENT CORPORATION vs J.KEMUMA ONYANGO & 3 OTHERS [1983] KECA 110 (KLR)", Case Analysis (1983). Civil Appeal 70 of 1982. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/1983/110/eng@1983-05-18

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.