Arvind Velji Shah v Zaverchand Sojpal Jetha Holdings Ltd & 5 others [2009] KECA 316 (KLR)
The bottom line
#Kenya's Court of Appeal ruled it has no power to 'stay' an injunction, so businesses must comply with injunctions pending appeal.
What this practically means
#Executive summary
#Key legal issues
#Whether rule 5(2)(b) of the Court of Appeal Rules empowers the Court to stay an injunction
It does not; the rule permits only a stay of execution, an injunction, or a stay of further proceedings, and a stay of an injunction is not among them.
The Court examined the text of rule 5(2)(b), which lists three types of orders: a stay of execution, an injunction, and a stay of any further proceedings. A stay of an injunction is omitted. The Court reasoned that granting a stay of an injunction would nullify the injunction before the appeal against it is heard, an omission likely intended by the Rules Committee. Following Consolidated Bank of Kenya v Usafi Limited, the Court held that an injunction once granted is in force and requires no execution.
Whether the intended appeal was arguable
Yes; both limbs of the rule 5(2)(b) test as to arguability were effectively conceded and the Court agreed the intended appeal was arguable and not frivolous.
Counsel for the 1st and 3rd to 6th respondents conceded arguability. The Court observed that the learned Judge granted injunction orders without hearing the application inter partes, and that if he merely extended interim orders, the extension prima facie offended order 39 rule 3(2) of the Civil Procedure Rules. However, the Court made no final decision on those matters, reserving them for the appeal court.
Whether refusal of the stay would render the intended appeal nugatory
The Court did not reach the nugatory limb because it found it had no jurisdiction to grant the orders sought in the first place.
Although the applicant argued that the companies would become insolvent and that he risked bankruptcy on personal guarantees, the Court held that the orders sought were simply not available under rule 5(2)(b) since the order to be stayed was an injunction. With no jurisdiction to make the orders, the nugatory-ness inquiry was immaterial and the application had to be dismissed.
Legal principles established
#- Rule 5(2)(b) of the Court of Appeal Rules does not confer jurisdiction on the Court to grant a stay of an injunction; the only orders available are a stay of execution, an injunction, or a stay of further proceedings.
- An injunction, once ordered, is in force and requires no further proceedings to give effect to it, so it cannot be 'stayed' or stayed in execution.
- An application under rule 5(2)(b) must satisfy the twin tests: the appeal or intended appeal must be arguable, and its success must not be rendered nugatory if the orders sought are refused.
- An injunction imposes a duty to stop doing something rather than a duty to do something, and such orders cannot be executed for purposes of stay.
Court orders
#- 1.The notice of motion dated seeking stay pending intended appeal is dismissed
- 2.No order as to costs
- On appeal from
- High Court of Kenya at Mombasa
- Mombasa H.C.C.C. No. 2 of 2009
- Jurisdiction invoked
- Rule 5(2)(b) of the Court of Appeal Rules
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Arvind Velji Shah v Zaverchand Sojpal Jetha Holdings Ltd & 5 others [2009] KECA 316 (KLR)", Case Analysis (2009). Civil Application No. 96 of 2009 (UR 60/09). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2009/316/eng@2009-05-29
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.