Del Monte Kenya Limited v Patrick Njuguna Kariuki [2013] KECA 2 (KLR)
The bottom line
#Kenya's Court of Appeal paused enforcement of a Kshs 8.8 million unfair termination award against Del Monte, but only if part of the money is paid and the rest secured.
What this practically means
#Executive summary
#Key legal issues
#Whether the Court was properly seized of the rule 5(2)(b) application despite the intended appeal record not having been filed within 60 days
The Court held it was properly seized, since the respondent had not invoked rule 84 to strike out the notice of appeal, and as long as that notice stands the application is properly premised on it.
The respondent argued the application was a non-starter because the record of appeal was filed outside the 60-day period. The applicant did not contest the fact, but the Court held that the proper remedy lay in rule 84, requiring the respondent to move the court to strike out the notice of appeal. Until that is done, the notice stands and the application premised on it is properly before the Court. The applicant was therefore entitled to a merit disposal.
Whether the intended appeal was arguable
The appeal was arguable: the Court identified at least three arguable points, being the retrospective application of section 12(3)(vi) of the Industrial Court Act in awarding exemplary damages, the propriety of reinstatement, and the award of loss of salary.
Applying the settled principles that a single bona fide arguable ground suffices and that an arguable appeal is one that ought to be argued fully rather than one that must succeed, the Court found several arguable grounds: whether the exemplary damages award was retrospective, whether reinstatement was justified, and the propriety of the award of loss of salary. This satisfied the first rule 5(2)(b) ingredient.
Whether refusal of stay would render the intended appeal nugatory
The second ingredient was demonstrated: the decretal sum included contested awards (exemplary damages and salary beyond the notice period), and neither the Industrial Court nor the Court of Appeal could police the respondent's disposal of the money once paid out.
Although the respondent exhibited an uncontroverted valuation report showing property worth about Kshs 21 million, exceeding the decretum, the Court held that what matters is reversibility: once money is paid, the Court cannot police its disposal or use. Following Nation Media Group v Kamotho, the balance of convenience favoured securing the decretal sum in a neutral place pending appeal, which safeguarded either party's interests.
Whether the absence of an offer of security defeated the application
Failure to offer security is not disentitling, because the Court has jurisdiction and discretion under sections 3A and 3B of the Appellate Jurisdiction Act to grant conditional or unconditional stay orders.
The respondent argued no security had been offered. The Court agreed no offer had been made but held its hands were not tied: it could impose conditions. It accepted the applicant's oral offer to release four months' salary from the deposited decretal sum and secure the balance in a neutral interest-earning account as reasonable, and moulded its orders accordingly.
Legal principles established
#- Where an application under rule 5(2)(b) is premised on a notice of appeal, that notice cannot be attacked collaterally; the procedural route is rule 84, and until the notice is struck out the application is properly premised on it.
- An applicant under rule 5(2)(b) need only demonstrate a single bona fide arguable ground of appeal.
- An arguable appeal is one which ought to be argued fully before the court, not one which must necessarily succeed.
- The nugatory-ingredient test is whether what is sought to be stayed is reversible or, if not, whether damages would reasonably compensate the successful appellant; and a party's failure to offer security is not by itself disentitling where the court can impose conditions under section 3A and 3B.
Court orders
#- 1.Stay of execution and/or implementation of the award made against the applicant in Industrial Court case No. 953 of 2011 delivered on 26 October 2012, and any decree resulting therefrom, pending the hearing and determination of the intended appeal
- 2.Condition that the applicant releases to the respondent an amount equivalent to four months salary previously earned, within 14 days of the ruling
- 3.The balance of the decretal amount to be deposited in an interest-earning account in the joint names of counsel for both parties in a mutually agreed financial institution within 14 days, or to remain secured on those terms if already secured
- 4.Costs of the application to be in the appeal
- On appeal from
- Industrial Court of Kenya
- Industrial Court Cause No. 953 of 2011
- Jurisdiction invoked
- Rule 5(2)(b) of the Court of Appeal Rules; sections 3A and 3B of the Appellate Jurisdiction Act (Cap 9); Article 159(2)(d) of the Constitution
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Del Monte Kenya Limited v Patrick Njuguna Kariuki [2013] KECA 2 (KLR)", Case Analysis (2013). Civil Application No NAI 4 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2013/2/eng@2013-09-27
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.