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Court of AppealDismissedCivil Appli 290 of 2006 (163/2006 UR)· [2007] KECA 64 (KLR)

WINFRED MUTUMI WAMBUA & PATRICK MASAI MAKAU v ABEDNEGO NYAMAI ARON MAKAU (Civil Application 290 of 2006) [2007] KECA 64 (KLR)

Court of Appeal of Kenya
30 March 2007
2,050 words in judgment
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The bottom line

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Kenya's Court of Appeal refused to stop a hotel takeover, because money lost during the appeal could be calculated and repaid later.

What this practically means

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Executive summary

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This was an application by notice of motion under rule 5(2)(b) of the Court of Appeal Rules by Winfred Mutumi Wambua and Patrick Masai Makau seeking an interlocutory injunction restraining Abednego Nyamai Aron Makau from erecting, alienating, managing or interfering with the operations of T-Tot Hotel, Machakos, pending an intended appeal against a ruling of Kubo, J. delivered on 27 September 2006 in H.C.C.C. No. 1395 of 2004. The High Court had dismissed the applicants' interlocutory injunction application in a dispute concerning the estate of the late Aron Wambua Makau, holding that the affidavit evidence balanced out and could not be determined without cross-examination of the deponents. The applicants argued before the Court of Appeal that the ruling was delivered prematurely, before closure of their submissions, amounting to denial of a fair hearing and bias, and that the respondent, as a joint administrator, was in breach of fiduciary duty and perpetrating a fraud on the estate by diverting hotel receipts. The court restated the settled rule 5(2)(b) two-limb test: the applicant must show an arguable intended appeal and that the appeal, if successful, would be rendered nugatory absent the order. Applying that test, the court held that granting the injunction would create more problems on the ground, that any loss could be quantified by assessing the hotel's average income, and that the main suit remained pending before the High Court. The single judgment of the court (Tunoi, O'Kubasu and Githinji, JJA) dismissed the application, with costs of the application in the intended appeal.

Key legal issues

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01

Test for grant of an injunction or stay under rule 5(2)(b) of the Court of Appeal Rules

Holding

The applicant must demonstrate both an arguable intended appeal and that the appeal, if successful, would be rendered nugatory without the order sought.

Reasoning

The court restated the settled two-limb test from Ruben & 9 Others v Nderito and Bob Morgan Systems Ltd v Jones. The application fails if either limb is not satisfied. The applicants' arguability arguments centred on alleged prematurity of the High Court ruling and denial of the right to be heard, but the court found the second, nugatory limb unmet because damages for operation of the hotel business would be readily assessable.

p. 4
02

Whether the High Court ruling dismissing the injunction application was premature and in breach of natural justice

Holding

The court did not accept that the applicants would be rendered nugatory even if the intended appeal on this point were arguable; the main suit remained pending before the High Court.

Reasoning

The applicants argued the judge ruled without hearing their closing submissions, amounting to bias and denial of a fair hearing. The Court of Appeal observed that the learned judge, alive to the nature of the dispute, directed the parties to take a hearing date for the main suit, so the underlying litigation would still determine the dispute; an injunction at this stage would create chaos rather than preserve the position.

p. 5
03

Whether the damage allegedly suffered by the applicants was compensable, defeating the nugatory-aspect limb

Holding

Any loss from the respondent operating the hotel during the pendency of the appeal would be quantifiable and therefore compensable, so the appeal would not be rendered nugatory.

Reasoning

The court reasoned that because the dispute relates to a hotel business, the average income for whatever period the respondent operated it could readily be assessed if the applicants ultimately succeeded. The court also noted that granting the injunction would create more problems on the ground, and that the land on which the hotel stands was said from the bar to be the respondent's property, with only the business in dispute.

p. 5

Legal principles established

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  • An applicant under rule 5(2)(b) must satisfy the court that the intended appeal is arguable and that, if successful, it would be rendered nugatory unless a stay or injunction is granted
  • In dealing with rule 5(2)(b) applications the Court of Appeal exercises original jurisdiction and considers the matter afresh; the exercise is not an appeal from the trial judge's discretion

Court orders

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  1. 1.The application for an interlocutory injunction pending the intended appeal is dismissed
  2. 2.Costs of the application shall be in the intended appeal

Authorities

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Legislation

  • Court of Appeal Rulesrule 5(2)(b)
  • Civil Procedure RulesOrder XXXIX rules 1 and 2

Cases cited (4)

  • Ruben & 9 Others v. Nderito & Another
    [1989] KLR 459
  • Stanley Munga Githunguri vs. Jimba Credit Corporation Ltd
    Civil Application NAI. 161 of 1988
  • Bob Morgan Systems Ltd & Another v. Jones
    (2004) 1 KLR 194
  • Giella v. Cassman Brown & Co. Ltd
    [1973] E.A. 358
On appeal from
High Court of Kenya at Nairobi
H.C.C.C. No. 1395 of 2004
Jurisdiction invoked
Rule 5(2)(b) of the Court of Appeal Rules (original jurisdiction to grant an injunction pending an intended appeal)

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, "WINFRED MUTUMI WAMBUA & PATRICK MASAI MAKAU v ABEDNEGO NYAMAI ARON MAKAU (Civil Application 290 of 2006) [2007] KECA 64 (KLR)", Case Analysis (2007). Civil Appli 290 of 2006 (163/2006 UR). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2007/64/eng@2007-03-30

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