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Court of AppealDismissedCivil Application No. 264 of 2008 (UR 169/2008)· [2008] KECA 104 (KLR)

Vanessa Gathoni Kamau v Bank of India [2008] KECA 104 (KLR)

Court of Appeal of Kenya
17 October 2008
EGE. M. GithinjiJOJ. W. Onyango OtienoJAJ. Aluoch
2,513 words in judgment
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The bottom line

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Kenya's Court of Appeal confirmed that winning an injunction pending appeal requires proving your case will be worthless without it, not just that your appeal is arguable.

What this practically means

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Executive summary

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This was a single-judge-application ruling by the Court of Appeal at Nairobi under Rule 5(2)(b) of the Court of Appeal Rules, in which Vanessa Gathoni Kamau sought an injunction restraining Bank of India from selling her property, L.R. No. Nairobi/Block 91/50 at Gigiri, and a stay of proceedings in Milimani HCCC No. 491 of 2008, pending an intended appeal against Kimaru, J's ruling of 15th September 2008 dismissing her injunction application as res judicata. The High Court had found that the issues she raised in her personal capacity were substantially and conclusively determined in an earlier suit, Nairobi HCCC No. 54 of 2008, filed by Urban Village Enterprises Limited, of which she is a director, over the same property charged to secure the company's loan. That suit had been compromised by a consent order granting the company 90 days to repay, later varied by a further 60 days, with a default clause permitting the bank to sell upon failure to pay; the company failed to pay and a substantial part of the loan remained owing. The Court of Appeal, per Githinji, Onyango Otieno and Alucho, JJ.A, held the intended appeal arguable on its 19 proposed grounds but refused relief because the applicant failed the second limb of the Rule 5(2)(b) test: she did not show that the appeal, if successful, would be rendered nugatory, damages being an adequate remedy against a viable bank. The application was dismissed, the temporary stay granted on 2nd October 2008 was discharged, and the court made no orders as to costs.

Key legal issues

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01

The twin test under Rule 5(2)(b) of the Court of Appeal Rules

Holding

The applicant must show both an arguable appeal and that the appeal would be rendered nugatory if the orders sought are not granted; arguability alone is insufficient

Reasoning

The court restated the settled principles governing Rule 5(2)(b) applications, adopting its earlier decision in Eustarine Estates Ltd v Leonard Investments Ltd. Although satisfied the intended appeal was arguable, the court found the applicant had not demonstrated that damages would not adequately compensate the bank or that the bank would be unable to pay damages, so the nugatory limb failed.

p. 4
02

Whether the res judicata finding by the High Court supported refusal of relief

Holding

The applicant's conduct in filing a personal suit after the company's suit on the same property had been compromised by consent undermined her claim, and the superior court had found her suit res judicata under section 7 of the Civil Procedure Act

Reasoning

The High Court had found the issues in the applicant's personal suit were substantially and conclusively determined in the company's earlier suit, which was compromised by a consent order containing a default clause permitting the bank to sell. The Court of Appeal noted the applicant swore affidavits in both suits and that a substantial part of the loan remained owing, weighing against granting relief.

p. 3

Legal principles established

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  • An arguable appeal alone does not entitle a party to a stay or injunction under Rule 5(2)(b); the applicant must additionally show that the appeal, if successful, would be rendered nugatory

Court orders

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  1. 1.The Notice of Motion dated 25th September 2008 is dismissed
  2. 2.The temporary order of stay of sale of the suit premises (L.R. No. NAIROBI/91/50) granted on 2nd October 2008 is discharged
  3. 3.No orders as to costs

Authorities

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Legislation

  • Court of Appeal RulesRule 5(2)(b)
  • Civil Procedure ActSection 7
  • Registered Land ActSection 65(2)
  • Registered Land ActSection 74

Cases cited (1)

  • Eustarine Estates Ltd vs Leonard Investments Ltd
    Civil Application No. Nai. 59 of 2007 (unreported)
On appeal from
High Court of Kenya, Nairobi (Milimani Commercial Courts)
HCCC No. 491 of 2008
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 (1)

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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, "Vanessa Gathoni Kamau v Bank of India [2008] KECA 104 (KLR)", Case Analysis (2008). Civil Application No. 264 of 2008 (UR 169/2008). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2008/104/eng@2008-10-17

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