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Court of AppealDismissedCivil Application No. 16 of 2013

Eres N. V & another v Maina Murage & Co. Advocates [2014] KECA 159 (KLR)

Court of Appeal
18 December 2014
2,011 words in judgment
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The bottom line

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Kenya's Court of Appeal refused to lift a security condition after a company ignored it, warning that misusing court procedures carries real costs.

What this practically means

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Executive summary

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This was a reference by Eres N.V and Eres Enterprises Limited under Rule 54 (now Rule 55) of the Court of Appeal Rules against part of the decision of Sichale, JA, who had extended time to file and serve a notice of appeal on condition that the applicants deposit half of Kshs. 57,793,600/- in an interest-earning joint account within 30 days. The underlying dispute concerned an advocate/client bill of costs; Ibrahim, J had partially allowed the clients' reference to the taxing master's decision, and both parties sought leave to appeal. Muya, J granted the applicants leave on condition of depositing security; they filed a notice of appeal but never complied with the deposit condition. The full Court (Githinji, Gatembu Kairu and J. Mohammed, JJ.A) applied the principles in Eddy Ndeto Gitetu v Kenya Commercial Bank, holding that a reference is not an appeal and that a discretionary order of a single judge will not be disturbed unless plainly wrong. It found the security condition justified given the applicants were a Belgian company with no known Kenyan assets. Crucially, the applicants had failed to satisfy the condition, so the extension had lapsed; they had also filed an appeal that was struck out ex parte, with a setting-aside application pending. The Court held that allowing the reference would be futile, would undermine the administration of justice, and that the reference's true purpose was to forestall the deposit of security, itself an abuse of process. It declined to determine whether leave to appeal is required under Rule 11(3) of the Advocates Remuneration Order, deferring that competence question to the substantive appeal. The reference was dismissed with costs to the respondent.

Key legal issues

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01

Test for interference with a single judge's discretionary decision on reference

Holding

The reference is not an appeal; the full Court will not interfere merely because it would have exercised the discretion differently.

Reasoning

The Court applied the principles in Eddy Ndeto Gitetu v Kenya Commercial Bank, restating that a reference is not an appeal and that a different view of the discretion is not a basis for disturbing the single judge's order. The applicants did not contend the single judge lacked jurisdiction to order security, only that the order was plainly wrong; the Court found the reasons given - the applicant's foreign status and absence of Kenyan assets - justified the condition.

p. 3
02

Abuse of process and futility in exercising the reference jurisdiction

Holding

The Court declined to exercise its jurisdiction where the applicants had breached the security condition and the extension had lapsed.

Reasoning

The applicants had filed the notice of appeal and a substantive appeal, which was struck out ex parte, while failing without explanation to comply with the deposit condition. Allowing the reference could not reverse those events or revive the lapsed extension; it would undermine orders made by the selfsame Court and forestall the deposit of security, itself an abuse of process.

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03

Whether leave to appeal is required under Rule 11(3) of the Advocates Remuneration Order

Holding

The Court expressly declined to determine the leave question in the reference, deferring it to the substantive appeal if raised.

Reasoning

The Court held the issue was not before it: it was not raised in the reference, so no full arguments had been received; the single judge had found the delay sufficiently explained and there was no reference from that finding; and the competence issue was best left to the Court hearing the appeal. The Court accordingly made no pronouncement on whether Article 164(3) abolished the leave requirement.

p. 2

Legal principles established

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  • A reference from a single judge's decision is not an appeal; the fact that the full Court would have exercised the discretion differently is not a sufficient ground for interference.
  • A full Court on reference will not interfere with a single judge's discretionary order under Rule 4 unless it is shown to be plainly wrong.
  • A party who fails to comply with a condition attached to an extension of time, and who abuses court process, cannot invoke the Court's jurisdiction to vary that order.

Court orders

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  1. 1.The reference from the decision of Sichale, JA is dismissed
  2. 2.Costs of the reference are awarded to the respondent
On appeal from
High Court of Kenya at Mombasa
Misc. Application No. 459 of 2008
Jurisdiction invoked
Rule 54 (now Rule 55) of the Court of Appeal Rules 2010 - reference from the decision of a single judge under the proviso to section 5 of the Appellate Jurisdiction Act

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, "Eres N. V & another v Maina Murage & Co. Advocates [2014] KECA 159 (KLR)", Case Analysis (2014). Civil Application No. 16 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2014/159/eng@2014-12-18

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