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Court of AppealDismissedCivil Appeal No. 190 of 2011· [2014] KECA 864 (KLR)

Export Processing Zones Authority v Kapa Oil Refineries Limited & 7 Others

Court of Appeal
24 January 2014
RNR. N. NambuyeWilliam OukoW. OukoPKP. O. Kiage
2,258 words in judgment
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The bottom line

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What this practically means

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Executive summary

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This is an interlocutory appeal by the Export Processing Zones Authority against a ruling of the High Court at Machakos (P. Kihara Kariuki, J.) dated 12th July 2010, granting the respondents a temporary injunction restraining the appellant from stopping, suspending or restricting the respondents' use of, and discharge of effluent into, the appellant's sewer line pending trial. The dispute arose when Mavoko Water & Sewerage Co. Limited and Tanathi Water Services Board took over management of the sewer system and the respondents began paying discharge charges to the Board, prompting the appellant to threaten cutting off discharge with effect from 5th February 2010. The respondents, a consortium of companies, sued seeking a declaration as to who between the appellant and the Board was entitled to receive the charges. The Court of Appeal (Nambuye, Ouko & Kiage, JJ.A.) restated the limited appellate function on discretionary decisions, citing Mbogo v Shah: interference is warranted only where the judge erred in principle, took into account irrelevant factors, or was clearly wrong. It reaffirmed the three-stage sequential Giella v Cassman Brown guidelines for interlocutory injunctions. Noting the respondents' genuine dilemma over payment and the imminent shutdown of operations supporting over 2,600 employees, the Court held that although the learned Judge did not expressly discuss the adequacy of damages, he adopted the generally accepted approach and reached the correct decision. The appeal was accordingly dismissed with costs, leaving the injunction in place pending trial.

Key legal issues

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01

Whether the High Court Judge misdirected himself in granting the temporary injunction

Holding

The appeal is dismissed; the Judge adopted the generally accepted approach and reached the correct decision in the circumstances of the dispute.

Reasoning

The respondents were caught in a genuine dilemma as to who, between the appellant and the Board, was entitled to receive sewer discharge charges, and faced imminent shutdown of operations supporting over 2,600 employees. The Judge found a prima facie case with probability of success and that the balance of convenience lay with the respondents. Although he did not expressly discuss adequacy of damages, the Court held he adopted the accepted approach and reached the correct decision, so no basis existed for appellate interference under the Mbogo v Shah principles.

p. 5
02

The limited scope of appellate interference with discretionary decisions

Holding

The Court of Appeal has no jurisdiction to exercise an independent original discretion on an appeal from a grant or refusal of an injunction; it may interfere only where the judge misdirected himself or was clearly wrong.

Reasoning

Relying on Mbogo v Shah, the Court restated that an appellate court should not interfere with a judge's discretion unless satisfied the judge misdirected himself in some matter and arrived at a wrong decision, or that it is manifest from the case as a whole that the judge was clearly wrong, resulting in misjustice. The Court must not substitute its own view merely because it would have exercised the discretion differently.

p. 2
03

Purpose of an interlocutory injunction

Holding

An interlocutory injunction maintains or preserves the status quo, prevents hardship or prejudice, precludes overreaching, and preserves a fair balance between the parties pending finality of proceedings.

Reasoning

The Court framed the interlocutory injunction as a preservationary device under section 63(c) and (e) of the Civil Procedure Act and Order XXXIX rules 1, 2 & 3 of the repealed Civil Procedure Rules, aimed at protecting parties while awaiting the final determination of the suit, not at determining the merits.

p. 4

Legal principles established

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  • An appellate court will not interfere with the exercise of a judge's discretion unless the judge erred in principle, took into account irrelevant factors or left out relevant ones, or the decision was wholly wrong or so aberrant that no reasonable judge could have reached it.
  • On an appeal from the grant or refusal of an interlocutory injunction, the Court of Appeal has a limited function and no jurisdiction to exercise an independent original discretion of its own; it must defer to the High Court Judge's discretion.
  • The guidelines for an interlocutory injunction are the three-stage sequential Giella enquiry: prima facie case with probability of success, irreparable injury not compensable by damages, and balance of convenience if in doubt.

Court orders

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  1. 1.Appeal dismissed with costs

Authorities

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Legislation

  • Civil Procedure ActSection 63(c) and (e)
  • Civil Procedure Rules, 2010Order 40 rules (1) and (2)
  • Civil Procedure Rules (repealed)Order XXXIX rules 1, 2 & 3

Cases cited (4)

  • Trade Agrain Limited v. Awal Limited
    Civil Appeal No. 269 of 2002, eKLR 2004

    Appellate court should not express concluded views on merits at interlocutory stage

  • Mbogo & Another v. Shah
    [1968] E.A. 93

    Circumstances in which an appellate court may interfere with a judge's exercise of discretion

  • Giella v Cassman Brown
    [1973] EA 358

    Conditions for grant of an interlocutory injunction

  • Kenya Commercial Finance Co. Ltd v. Afraha Education Society & Others
    Civil Application No. 142 of 1999 [2001] 1 EA 86

    Giella stages applied as separate, distinct and logical hurdles surmounted sequentially

On appeal from
High Court of Kenya at Machakos
H.C.C.C. No. 35 of 2010
Jurisdiction invoked
Appellate jurisdiction of the Court of Appeal over an interlocutory appeal against exercise of judicial discretion (Section 63(c) & (e) Civil Procedure Act; Order 40 rules 1 & 2 Civil Procedure Rules, 2010)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (16)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Export Processing Zones Authority v Kapa Oil Refineries Limited & 7 Others", Case Analysis (2014). Civil Appeal No. 190 of 2011. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2014/864/eng@2014-01-24

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