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Court of AppealStruck OutCivil Appli No. 219 of 2007 (134/2007 UR)· [2008] KECA 257 (KLR)

Sonalux Limited & another v Barclays Bank of Kenya Limited & 2 others [2008] KECA 257 (KLR)

Court of Appeal
8 February 2008
SBS.E.O. BosireEOE.O. O'KubasuEGE.M. Githinji
2,239 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 confirmed you cannot seek a stay of a court order that merely dismisses your application, because a dismissal orders nothing and cannot be executed.

What this practically means

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Executive summary

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The applicants, Sonalux Limited and African Retail Traders (K) Ltd (in receivership), moved the Court of Appeal under Rule 5(2)(b) of the Court of Appeal Rules seeking stay of execution of a ruling of Kasango, J delivered on 29th January 2007 in H.C.C.C. No. 697 of 2005. The ruling under appeal had dismissed the applicants' chamber summons in which they had sought to restrain Barclays Bank of Kenya and the receiver managers it appointed under a debenture from acting as receiver/managers and from selling charged property, L.R. No. 209/601, secured for the second applicant's indebtedness. The High Court found no prima facie case and no irreparable harm under the Giella v Cassman Brown tests, and rejected reliance on section 52 of the Transfer of Property Act as a bar to the chargee's power of sale. At the hearing, the respondents raised a preliminary objection contending that, the impugned order being a bare dismissal of the chamber summons, there was nothing capable of being stayed. The Court agreed, following its decision in Western College of Arts and Applied Sciences v Oronga and its recent unreported decisions in Nyongo and Ndungu Kinyanjui, that a stay of execution under Rule 5(2)(b) presupposes an order requiring a party to do something, refrain from doing something, or pay a sum. A dismissal with costs orders nothing of that kind, so no stay could properly issue and an injunction could not be used to circumvent that position. The Court upheld the preliminary objection and struck out the notice of motion dated 24th August 2007 with costs to the respondents. No separate opinion was written; the bench was unanimous.

Key legal issues

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Competence of a Rule 5(2)(b) application for stay of execution of a purely negative order of dismissal

Holding

A dismissal order that directs no party to do or refrain from doing anything, and requires no payment, is incapable of execution and cannot be the subject of a stay; the application is incompetent and liable to be struck out.

Reasoning

The Court traced the applicants' chamber summons as having been dismissed with costs by Kasango, J. Applying its own prior decisions and the Western College of Arts and Applied Sciences v Oronga authority, it held that stay under Rule 5(2)(b) presupposes an executable order. Since the High Court ordered nothing to be done or paid, there was nothing to stay, and a temporary injunction could not substitute for it.

p. 4

Legal principles established

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  • In an application under Rule 5(2)(b) for stay of execution, where the court whose order is sought to be stayed has not ordered any party to do anything, refrain from doing anything, or pay any sum, there is nothing for the Court of Appeal to enforce or restrain by injunction, and no stay can issue.

Court orders

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  1. 1.The preliminary objection is upheld
  2. 2.The notice of motion dated 24th August, 2007 is struck out with costs to the respondents

Authorities

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Legislation

  • Court of Appeal RulesRule 5(2)(b)
  • Civil Procedure RulesOrder XXXIX Rules 1, 2, 3 and 9
  • Civil Procedure RulesOrder L Rule 1
  • Civil Procedure ActSection 3A
  • Transfer of Property ActSection 52
  • Transfer of Property ActSection 69A
  • Companies ActSections 353 and 354(1)

Cases cited (5)

  • Giella v Cassman Brown
    [1973] EA 358
  • Western College of Arts and Applied Sciences vs. Oronga
    (1976) KLR 63
  • The Hon. Peter Anyang' Nyongo' & 2 others vs. The Minister for Finance & Another
    Civil Application No. NAI. 273 of 2007 (unreported)
  • Ndungu Kinyanjui vs. Kibichoi Kugeria Services & Another
    Civil Application No. NAI 79 of 2007 (unreported)
  • David Thiongo T/A Welcome General Stores vs. Market Fancy Emporium
    Civil Application No. Nai. 47 of 2007
On appeal from
High Court of Kenya at Nairobi, Milimani Commercial Court and Tax Division
H.C.C.C. No. 697 of 2005
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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Cite this brief

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Cite this brief

Caselaw, "Sonalux Limited & another v Barclays Bank of Kenya Limited & 2 others [2008] KECA 257 (KLR)", Case Analysis (2008). Civil Appli No. 219 of 2007 (134/2007 UR). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2008/257/eng@2008-02-08

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