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Court of AppealPartially AllowedCivil Application No. Nai 24 of 1998 (11/98UR)· [1998] KECA 246 (KLR)

LAKELAND MOTORS LIMITED vs HARBHAJAN SINGH SEMBI [1998] KECA 246 (KLR)

Court of Appeal of Kenya
20 February 1998
1,141 words in judgment
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The bottom line

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Kenya's Court of Appeal set aside a debt collection that skipped key legal steps, confirming creditors cannot seize property without following proper procedure.

What this practically means

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Executive summary

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This is a ruling of the Court of Appeal at Nairobi (Gicheru, Omolo and Shah, JJ.A.) on an application by Lakeland Motors Limited for a stay of execution of a decree of the High Court at Kisumu (Wambilyangah, J.) dated 21st January 1998 in Kisumu H.C.C.C. No. 227 of 1997, together with a mandatory injunction for the return of attached goods pending an intended appeal. Judgment had been entered for the respondent in the sum of K.Shs.5,264,435.55 with interest. The applicant had also filed a winding-up petition and an application under section 223 of the Companies Act to stay the suit proceedings, which was dismissed. The respondent then applied ex parte for a warrant of attachment before taxation under section 94 of the Civil Procedure Act, obtained an ex parte order dispensing with rule 12(b) of the Auctioneers Rules, 1997, extracted the decree without the applicant's involvement contrary to Order XX rule 7 of the Civil Procedure Rules, attached the applicant's goods and advertised them for auction. The court held that section 94 requires parties to be heard before execution before taxation is ordered, that the decree was irregularly extracted, and that there was no power to dispense with rule 12(b), whose breach amounted to gross irregularity and abuse of process. The court declined a stay under rule 5(2)(b) but, in exercise of its inherent power under rule 1(3), set aside the entire execution process. It made no order on the application costs but ordered the respondent to bear the costs of the irregular and wrongful attachment, including court broker's costs.

Key legal issues

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01

Right to be heard before execution before taxation under section 94 of the Civil Procedure Act

Holding

An order for execution before taxation under section 94 cannot properly be made without affording the decree-debtor an opportunity to be heard; here the applicant was never made aware of the respondent's application for a warrant of attachment.

Reasoning

The court held that the judicial discretion under section 94 requires that parties to a decree passed in the court's original civil jurisdiction be heard before an order for execution before taxation is made. The only step on record was the respondent's letter to the Deputy Registrar seeking a warrant; the applicant was not notified. The court endorsed Shah, J.A.'s observation in the Bamburi Portland Cement case on the application of section 94.

p. 2
02

Compliance with Order XX rule 7 of the Civil Procedure Rules in preparation of the decree

Holding

The respondent extracted the decree without the applicant's involvement, contrary to the relevant provisions of Order XX rule 7, and this was not contested by his counsel.

Reasoning

The record showed the respondent applied for a warrant of attachment on 22nd January 1998 and extracted the decree on 23rd January 1998 without the applicant's knowledge or participation, in total disregard of Order XX rule 7 governing preparation of decrees. Counsel for the respondent did not contest this at the hearing, leaving the irregularity established on the record.

p. 2
03

Mandatory compliance with rule 12(b) of the Auctioneers Rules, 1997 in attachment of movables

Holding

Rule 12(b) requires a proclamation in Sale Form 2 with an inventory of attached movables signed by the owner or an adult at the premises; there is no provision dispensing with it, and execution in breach of it is a gross irregularity justifying setting aside the execution process.

Reasoning

The Deputy Registrar had granted the respondent an ex parte order dispensing with compliance with rule 12(b), but the court found no power in the Auctioneers Act, 1996 or the Auctioneers Rules, 1997 to dispense with the rule. The goods were attached and advertised for auction without the required proclamation and inventory. The court characterised this as a gross irregularity and an abuse of process, and in exercise of its inherent power under rule 1(3) set the execution process aside rather than granting a stay.

p. 2

Legal principles established

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  • Before a superior court orders execution of its decree before taxation under section 94 of the Civil Procedure Act, the parties to the decree must be given an opportunity to be heard.
  • A decree must be prepared with the involvement of the parties as required by Order XX rule 7 of the Civil Procedure Rules, and execution in breach of the Auctioneers Rules is a gross irregularity that an appellate court will set aside in exercise of its inherent power.

Court orders

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  1. 1.Stay of execution under rule 5(2)(b) declined
  2. 2.The execution process of the decree in Kisumu Civil Case No. 227 of 1997 set aside in exercise of inherent power under rule 1(3) of the Court of Appeal Rules
  3. 3.No order as to the costs occasioned by the application
  4. 4.The costs occasioned by the irregular and wrongful attachment, including the court broker's costs, to be borne by the respondent
On appeal from
High Court of Kenya at Kisumu
Kisumu H.C.C.C. No. 227 of 1997
Jurisdiction invoked
Rule 5(2)(b) and rule 1(3) of the Court of Appeal Rules (inherent power)

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, "LAKELAND MOTORS LIMITED vs HARBHAJAN SINGH SEMBI [1998] KECA 246 (KLR)", Case Analysis (1998). Civil Application No. Nai 24 of 1998 (11/98UR). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/1998/246/eng@1998-02-20

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