African Safari Club Limited v Safe Rentals Limited (Civil Application 53 of 2010) [2010] KECA 270 (KLR)
The bottom line
#Kenya's Court of Appeal granted a hotel company a stay of a Kshs.141 million decree, replacing an impossible bank guarantee with property as security.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the intended appeal is arguable (not frivolous)
- 2.Whether, if a stay is not granted, the intended appeal, if successful, would be rendered nugatory
- 3.Whether the overriding objective requires the Court to go beyond the two traditional rule 5(2)(b) requirements and balance the hardships of the parties
Key legal issues
#The twin conditions for stay under rule 5(2)(b) and their relationship to the overriding objective
The two traditional conditions remain, but are no longer exhaustive; the Court must take a broader view of justice and give effect to the overriding objective when exercising its rule 5(2)(b) jurisdiction.
The Court held that the two long-standing requirements — an arguable appeal and that the appeal would be rendered nugatory absent a stay — have served justice well but, after the enactment of the overriding objective, the Court is required to take a much broader view of justice. Because rule 5(2) is subject to the overriding objective, the Court exercising power under the rule must give effect to it, drawing its power from the rule and the Appellate Jurisdiction Act.
Whether the intended appeal would be rendered nugatory absent a stay, given the applicant's insolvency risk
The applicant faced unusual hardship: the guarantee conditions would require cash or realizable collateral of the colossal decretal amount, and the pending winding up cause exposed both parties to non-recovery. Balancing the parties' hardships under the overriding objective justified a stay on modified terms.
The Court analysed the applicant's inability to provide a guarantee without cash collateral, the winding up cause with nine creditors owed over Kshs.25 million, and the respondent's own risk of ending up with a paper decree since the applicant could not pay the much greater decretal amount. Faced with almost equal hardship, the Court weighed the hardships on the scales and offered the yacht and Coast property (combined value Kshs.100 million) as security, placing the parties on an equal footing.
Distinguishing Hunker Trading Company Ltd v Elf Oil Ltd
Hunker was distinguishable: that application was brought under section 3A of the Appellate Jurisdiction Act, the applicant there had not complained that the superior court's conditions were onerous, and there was total neglect of the order constituting an abuse of process.
The respondent relied heavily on Hunker. The Court accepted similarities but identified critical differences: the legal basis of the application, the absence of any complaint about onerous conditions in Hunker, and the total neglect of the superior court order there, which the Court had found to be a misuse of the court's time and resources. The Court therefore declined to follow Hunker's outcome on the facts before it.
Legal principles established
#- The two traditional rule 5(2)(b) requirements (arguable appeal and nugatory appeal) are no longer exhaustive; the Court must also give effect to the overriding objective when exercising its power under the rule.
- Application of the overriding objective must rest on a factual or legal foundation and be tailored to doing justice on the facts of the particular matter.
Court orders
#- 1.Stay of execution of the decree granted on conditions
- 2.The applicant to pay the respondent Kshs.7,218,664 within 35 days from the date of the order
- 3.The applicant to deposit within 14 days with the Deputy Registrar its title in respect of the immovable property located at the Coast valued at Kshs.50,000,000 and the ownership documents in respect of the yacht valued at Kshs.50 million, the assets to be free from any encumbrances
- 4.Should the applicant in any way pursue the pending stay application in the superior court, the orders granted shall automatically lapse
- 5.Should the applicant fail to meet any of the above conditions or any part thereof, the application shall stand dismissed with costs
- 6.The costs of the application to abide the outcome of the appeal
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court of Kenya, Mombasa
- High Court Civil Case No. of 2006
- Jurisdiction invoked
- Rule 5(2)(b) of the Court of Appeal Rules, read with the Appellate Jurisdiction Act and the overriding objective
Relief refused
#Unconditional stay without any payment towards the decretal sum
The Court ordered payment of Kshs.7,218,664, considering the applicant could suffer no extraordinary hardship paying this sum
Stay on the terms granted by the superior court (cash deposit plus bank guarantee/performance bond for the balance)
The Court found the guarantee requirement would effectively require a cash deposit of the colossal decretal amount, grounding the applicant's operations
Costs
The costs of the application to abide the outcome of the appeal; should the applicant fail to meet any of the conditions, the application shall stand dismissed with costs.
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
Rule 5(2) is subject to the overriding objective and therefore this Court in exercising its power under the rule, must give efiect to the overriding objective
With the above scenario of almost equal hardship by the parties it is incumbent upon the Court, pursuant to the overriding objective to act justly and fairly
The matter before us is distinguishable from the HUNKER case (supra)
In the result, we allow the application by granting an order for stay of execution on these terms
In the meantime, the costs of the application to abide the outcome of the appeal.It is so ordered.
Issues in the judgment
#The superior court case number is incomplete in the judgment (no case number stated).
The respondent's citation of the Appellate Jurisdiction Act sections is garbled in the judgment.
The reasons offered by the applicant for Hunker distinguishability are numbered inconsistently ('first... second... fourth') with no 'third'.
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (2)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Wachira (Suing as administrator of the Estate of Esther Nungari Kinuthia) & 2 others v Duntowobi & 2 others (Land Case E010 of 2023) [2026] KEELC 2837 (KLR)[2026] KEELC 2837 (KLR)14 May 2026
- Estate of Lomaria Kotoruk alias Plimo Kotoruk (Deceased) represented by Susan Cherop v Psinen (Environment and Land Case 54 of 2016) [2025] KEELC 8197 (KLR)[2025] KEELC 8197 (KLR)26 Nov 2025applied
Cite this brief
#Cite this brief
Caselaw, "African Safari Club Limited v Safe Rentals Limited (Civil Application 53 of 2010) [2010] KECA 270 (KLR)", Case Analysis (2010). Civil Application No. NAI 143 of 2010 (arising from High Court Civil Case No. of 2006, Mombasa). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2010/270/eng@2010-05-28
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.