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Court of AppealAllowedCivil Appli 72 of 2006· [2006] KECA 252 (KLR)

East African Safari Air Limited v Anthony Ambaka Kegode & Another

Court of Appeal of Kenya
5 May 2006
EGE. M. GithinjiJOJ. W. Onyango OtienoWDW. S. Deverell
1,216 words in judgment
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The bottom line

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Kenya's Court of Appeal froze the Kegodes' bank accounts and paused the High Court case, because East African Safari Air's appeal would be worthless if the money left the country.

What this practically means

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Executive summary

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East African Safari Air Limited (EASA) applied under rule 5(2)(b) of the Court of Appeal Rules for an injunction restraining the Kegode respondents from withdrawing monies held in their accounts at Charterhouse Bank and Standard Chartered Bank, and for a stay of proceedings in Milimani HCCC No. 345 of 2004, pending an intended appeal against a ruling of Emukule J delivered on 2nd March 2006. The High Court ruling had allowed with costs the first respondent's application to strike out EASA's suit and interim Chamber Summons, on the ground that EASA's new directors had been invalidly appointed (appointments not falling within the Article 28 casual-vacancy exception), leaving no properly constituted board to authorise the suit, and that the receivers' ratification was doubtful. The Court of Appeal framed the familiar twin tests: whether the intended appeal was arguable, and whether it would be rendered nugatory if relief were refused. It found it highly probable that the frozen funds would be removed from the jurisdiction, and concluded that the applicant had raised arguable, non-frivolous issues, declining to elaborate lest it influence the bench hearing the substantive appeal. The court allowed the application, issued the injunction, stayed further proceedings in the superior court, and ordered that costs of the application be in the intended appeal. This is an interlocutory ruling; it does not disturb the High Court decision, which remains subject to the intended appeal.

Key legal issues

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01

Whether the twin tests for relief under rule 5(2)(b) were satisfied

Holding

The court found both limbs satisfied: the money frozen in the bank accounts might be removed from the jurisdiction, rendering any successful appeal nugatory, and the intended appeal raised arguable issues.

Reasoning

The court applied the established two-limb test for rule 5(2)(b) applications. On nugatory aspect, it found it highly probable the frozen funds would be withdrawn and taken out of the jurisdiction if relief were refused. On arguability, it concluded after careful consideration of the Judge's reasons that the applicant had raised arguable, non-frivolous issues, without elaborating further.

p. 2

Legal principles established

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  • On a rule 5(2)(b) application the applicant must show that the intended appeal is arguable (not frivolous) and that, if stay or injunction is not granted and the appeal succeeds, it will have been rendered nugatory.
  • An appellate court on a rule 5(2)(b) application should not give reasons that may influence the bench that will hear the substantive appeal.

Court orders

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  1. 1.An injunction restraining Anthony Ambaka Kegode and Elizabeth Ann Kegode, and each of them, from withdrawing or disposing of any sums of money deposited in their accounts at Charterhouse Bank Limited (Longonot Branch) and Standard Chartered Bank Limited (Langata and Karen Branches) pending final determination of the intended appeal against the ruling and orders of Emukule J delivered on 2nd March 2006 in Milimani H.C.C.C. No. 345 of 2004
  2. 2.A stay of any further proceedings in the superior court in Milimani H.C.C.C. No. 345 of 2004 pending determination of the intended appeal against the ruling and orders of Emukule J delivered on 2nd March 2006
  3. 3.Costs of and incidental to the application to be in the intended appeal
On appeal from
High Court of Kenya at Milimani Commercial Courts, Nairobi
H.C.C.C. No. 345 of 2004
Jurisdiction invoked
Rule 5(2)(b) of the Court of Appeal Rules

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (2)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "East African Safari Air Limited v Anthony Ambaka Kegode & Another", Case Analysis (2006). Civil Appli 72 of 2006. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2006/252/eng@2006-05-05

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