STEPHEN KIMANI MUHU V SAVINGS AND LOAN KENYA LIMITED & ANOTHER [2009] KECA 243 (KLR)
The bottom line
#Kenya's Court of Appeal stopped the auction of a borrower's house because selling it before his appeal was heard would cause a loss no money award could fix.
What this practically means
#Executive summary
#Key legal issues
#Whether the intended appeal was arguable
The Court found the intended appeal arguable on several points: the effective date of the charge (registration on 23rd May 1986 versus signing in 1982) for purposes of charging interest; the amount actually advanced (Ksh.286,200/= versus Ksh.414,907/=); and the consequential question of the correct amount due on either calculation.
The Court identified that whether interest should run from the date the charge was signed or the date of registration, and whether interest should be based on the amount stated in the charge or an inflated figure, were matters requiring thorough investigation in the intended appeal. Those questions were neither frivolous nor idle, satisfying the first limb of the rule 5(2)(b) test.
Whether the appeal would be rendered nugatory if the injunction was refused
The Court held that if the property were sold before the appeal was heard, the applicant would lose both the payments already made (Ksh.2,286,664/=) and the house itself, a loss totally disproportionate to any damages, so the nugatory limb was satisfied.
The Court weighed the consequence of an auction against the adequacy of damages. Because the applicant stood to lose his house and all sums paid for a loan of only Ksh.286,200/= or Ksh.414,907/=, monetary compensation could not cure the loss. Equity therefore favoured preserving the property until the appeal was determined.
Legal principles established
#- An applicant under rule 5(2)(b) must satisfy the Court first that the intended or filed appeal is arguable (not frivolous) and second that, if the appeal succeeds, its success would be rendered nugatory by refusal to grant the application.
- Where the loss that would follow a sale of property before an intended appeal is heard would be totally disproportionate to any amount of damages, the Court will grant an injunction to stop the sale.
Court orders
#- 1.Temporary injunction restraining the respondents by themselves and/or their agents, servants and/or employees from further advertising, offering for sale, selling by public auction or otherwise and/or in any manner whatsoever disposing of the property known as L.R. No. NAIROBI/BLOCK 72/1249 pending the hearing and determination of the intended appeal
- 2.Costs of the application to be in the intended appeal
- On appeal from
- High Court of Kenya at Milimani Commercial Courts
- H.C.C.C. No. 493 of 2006
- Jurisdiction invoked
- Rules 5(2)(b) and 47(1) of the Court of Appeal Rules
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "STEPHEN KIMANI MUHU V SAVINGS AND LOAN KENYA LIMITED & ANOTHER [2009] KECA 243 (KLR)", Case Analysis (2009). Civil Application No. 145 of 2008 (UR 92/2008). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2009/243/eng@2009-07-10
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.