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Court of AppealDismissedCivil Application No. 294 of 2007 (UR)· [2008] KECA 260 (KLR)

Stanbic Bank Kenya Limited v Kenya Revenue Authority [2008] KECA 260 (KLR)

Court of Appeal
8 February 2008
ROR.S.C OmoloPhilip Kiptoo TunoiP.K. TunoiJOJ.W. Onyango Otieno
2,899 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 it cannot stop KRA from collecting disputed tax when the High Court only dismissed a case without making any positive order.

What this practically means

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Executive summary

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The applicant bank sought, by notice of motion dated 3rd December 2007, an injunction restraining the Kenya Revenue Authority from demanding or recovering withholding tax of over Ksh.7,954,342 in respect of Reuters services pending an intended appeal against the High Court's dismissal of its judicial review application for certiorari and prohibition. The High Court (Wendo, J) had dismissed the motion with costs on 23rd November 2007. Before the Court of Appeal, counsel for the applicant conceded that an injunction could not be granted, since the High Court in a judicial review application under Order 53 rule 3(1) could not have granted one, and section 3(3) of the Appellate Jurisdiction Act requires the appellate court to apply the same law as the High Court. Counsel instead asked the Court to read prayer 3 (liberty to apply for further orders) as an application for stay of execution or maintenance of status quo under rule 5(2)(b). The Court declined, holding that its powers under rule 5(2)(b) are confined to stay of execution, stay of proceedings and injunction, and cannot be extended to create a prayer not sought. In any event, the High Court had made no positive order: it merely dismissed the motion, leaving nothing capable of execution or stay, a position settled in Western College (Weco) v Oranga, Mombasa Seaport Duty Free v Kenya Ports Authority and Republic v Kenya Wildlife Services. The Court found it unnecessary to decide whether the KRA can be injuncted under section 3(2)(a) of the Kenya Revenue Authority Act read with section 16(1)(i) of the Government Proceedings Act, or whether the intended appeal would be rendered nugatory. The application was dismissed with costs to the respondent.

Key legal issues

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01

Availability of injunction on appeal from a judicial review application

Holding

The Court cannot grant an injunction because the High Court could not have granted one in a judicial review application under Order 53 rule 3(1).

Reasoning

Section 3(3) of the Appellate Jurisdiction Act mandates that on appeal the Court applies the law applicable in the High Court. Because the judicial review jurisdiction does not permit the grant of injunctions, the same incapacity attaches to the appellate court hearing the intended appeal. Applicant's counsel conceded this point.

p. 3
02

Whether prayer 3 could be treated as an application for stay

Holding

No; the court cannot re-cast a prayer not sought, and doing so would amount to abuse of its discretionary powers under rule 5(2)(b).

Reasoning

Prayer 3 merely sought liberty to apply for further orders; it did not seek stay or status quo. Rule 5(2)(b) confines the Court's powers to three specified orders, and its inherent powers revolve around those aspects only. Reading a stay into a general prayer would be close to abusing the discretion.

p. 3
03

Whether there was a positive order capable of being stayed

Holding

No; the superior court's dismissal of the judicial review motion was a negative order with nothing to execute or stay.

Reasoning

The High Court did not order the respondent to collect the tax or the applicant to pay it; it simply dismissed the motion for certiorari and prohibition with costs. Following Weco v Oranga, Mombasa Seaport Duty Free and Republic v Kenya Wildlife Services, a bare dismissal leaves no positive and enforceable order that a stay or injunction could attach to.

p. 5

Legal principles established

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  • On an appeal, the Court of Appeal applies the same law as the High Court; since an injunction cannot issue in a judicial review application under Order 53, the Court of Appeal cannot grant one in respect of such a matter.
  • There is no order capable of being stayed where the superior court has merely dismissed an application without ordering any party to do or refrain from doing anything.
  • The inherent powers of the Court under rule 5(2)(b) are confined to stay of execution, stay of proceedings and injunction, and cannot be stretched to create or grant a prayer not sought.

Court orders

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  1. 1.The application is dismissed with costs to the respondent

Authorities

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Legislation

  • Kenya Revenue Authority Actsection 3(2)(a)
  • Government Proceedings Actsection 16(1)(i)
  • Appellate Jurisdiction Actsection 3(3)
  • Civil Procedure RulesOrder 53 rule 3(1)
  • Court of Appeal Rulesrule 5(2)(b)

Cases cited (3)

  • Western College of Arts and Applied Sciences (Weco) vs. Oranga
    (1976) KLR 63
  • Mombasa Seaport Duty Free Ltd vs. Kenya Ports Authority – Civil Application No. Nai. 242 of 2006
    unreported
  • Republic vs. Kenya Wildlife Services & 2 others – Civil Application No. Nai. 12 of 2007
    unreported
On appeal from
High Court of Kenya at Nairobi
H.C. Misc. Application No. 1371 of 2005
Jurisdiction invoked
Rule 5(2)(b) of the Court of Appeal Rules; section 3(3) of the Appellate Jurisdiction Act, Chapter 9, Laws of Kenya

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, "Stanbic Bank Kenya Limited v Kenya Revenue Authority [2008] KECA 260 (KLR)", Case Analysis (2008). Civil Application No. 294 of 2007 (UR). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2008/260/eng@2008-02-08

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