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Court of AppealAllowedCivil Application No. Nai. 52 of 2014· [2014] KECA 522 (KLR)

Otieno Ragot & Company Advocates v Capital Construction Ltd & 3 others [2014] KECA 522 (KLR)

Court of Appeal
20 June 2014
1,799 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
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The bottom line

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Kenya's Court of Appeal halted court proceedings so a law firm can appeal after a client replaced it with new lawyers without proper notice.

What this practically means

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Executive summary

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The Court of Appeal at Nairobi (Waki, Maraga and Murgor JJ.A) determined a Notice of Motion dated 20th March 2014 brought by Otieno Ragot & Company Advocates under Rule 5(2)(b) of the Court of Appeal Rules, seeking stay of proceedings in High Court Civil Case No. 645 of 2006 pending an intended appeal against the ruling of Havelock J delivered on 6th March 2014. The applicant, formerly advocates for the 1st to 4th respondents in a suit by Equity Bank Ltd for over Kshs. 725 million, had successfully defended that suit and had taxed party and party costs paid by the 5th respondent. Kamwendwa & Company Advocates thereafter came on record for the 1st to 3rd respondents without giving the applicant notice or obtaining prior leave, contrary to Order 9 Rule 9 of the Civil Procedure Rules, and filed a bill of costs. Havelock J allowed Kamwendwa on record but struck out his pleadings. The applicant contended the judge dealt substantively with the application unheard and that it held an advocate's lien over unpaid fees. Applying the settled twin principles from Reliance Bank Ltd (In Liquidation) v Norlake Investments Ltd, the court found the intended appeal arguable on the Order 9 Rule 9 compliance question, and found the appeal would be rendered nugatory because the respondents' ability to pay fees was unproven. It allowed the application, ordering stay of proceedings in terms of prayer one, with costs in the intended appeal. The decision below was not disturbed; this was an interlocutory application for stay pending appeal.

Key legal issues

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01

Whether the intended appeal challenging the placement of Kamwendwa & Company Advocates on record without compliance with Order 9 Rule 9 was arguable

Holding

The court found the issue arguable: the purpose of Order 9 rule 9 is to protect an outgoing advocate's interests, including fees, and non-compliance by incoming counsel raised a real question for appeal.

Reasoning

The court reasoned that Order 9 rule 9 exists to ensure an outgoing counsel is notified of changes in representation so they may safeguard their interests. Being denied fees for services rendered by unilateral replacement is disconcerting. Since Kamwendwa admittedly did not serve the applicant with notice and sought to validate the omission via a High Court motion, the question of whether the requisite procedure was followed was an arguable issue fit for appeal.

p. 3
02

Whether the intended appeal would be rendered nugatory if the stay of proceedings was not granted

Holding

The court was satisfied that the appeal would be rendered nugatory, noting the respondents' capacity to satisfy any eventual costs obligation was unaddressed and the applicant risked being left unpaid.

Reasoning

Kamwendwa asserted the applicant could tax its bills and execute against the respondents, but did not demonstrate that the respondents were financially capable of honouring their obligations. Given the applicant's claims that the 1st respondent was a shell company and the 2nd and 3rd respondents had no attachable assets, the court was of the distinct impression that the applicant would be left holding the wrong end of the stick, justifying a stay of proceedings.

p. 3

Legal principles established

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  • An application under Rule 5(2)(b) succeeds only if the applicant shows the appeal is arguable and that refusal of the stay or injunction would render the appeal nugatory.
  • The purpose of Order 9 rule 9 of the Civil Procedure Rules is to ensure that an outgoing counsel is duly notified of any change in representation so as to safeguard their interests, including their fees.

Court orders

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  1. 1.Stay of proceedings in terms of prayer one of the notice of motion dated 20th March 2014 pending determination of the intended appeal
  2. 2.Costs of the application to be in the intended appeal

Authorities

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Legislation

  • Civil Procedure ActSection 1A
  • Civil Procedure ActSection 1B
  • Civil Procedure RulesOrder 9 Rule 9
  • Court of Appeal RulesRule 5(2)(b)

Cases cited (1)

  • Reliance Bank Ltd (In Liquidation) vs. Norlake Investments Ltd
    Civil Appl. No. Nai. 93/02 (UR)
On appeal from
High Court
H.C.C.C. No. 645 of 2006
Jurisdiction invoked
Rule 5(2)(b) of the Court of Appeal Rules

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, "Otieno Ragot & Company Advocates v Capital Construction Ltd & 3 others [2014] KECA 522 (KLR)", Case Analysis (2014). Civil Application No. Nai. 52 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2014/522/eng@2014-06-20

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