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Court of AppealDismissedCivil Application No. NAI. 191 of 2015· [2015] KECA 150 (KLR)

ABN Amro Bank N.V v Kenya Pipeline Company Limited [2015] KECA 150 (KLR)

Court of Appeal
11 December 2015
1,659 words in judgment
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The bottom line

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Kenya's Court of Appeal refused to halt a Shs.26 million costs bill, holding that a party seeking a stay must prove the appeal would be worthless without one.

What this practically means

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Executive summary

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This Court of Appeal ruling at Nairobi (Okwengu, J. Mohammed and Kantai, JJ.A.) disposed of an application under Rules 5(2)(b) and 42 of the Court of Appeal Rules, 2010 and Sections 3(2), 3A and 3B of the Appellate Jurisdiction Act by ABN AMRO Bank N.V., seeking a stay of proceedings and of taxation of Kenya Pipeline Company Limited's party and party bill of costs of about Shs.26 million, pending determination of Civil Appeal No. 149 of 2015 against a High Court ruling (Gikonyo, J., 30 September 2014) that ordered production of documents and, on the applicant's default, struck out its suit. Applying the settled twin principles for Rule 5(2)(b) relief, the Court found arguability satisfied - whether the judge was right to hold the requested documents relevant was an arguable point, and one arguable point suffices. However, the nugatory limb failed: the bill had not been taxed, the amount payable was unknown, the applicant had ignored the respondent's request to identify contested items, and as a large foreign bank it could refund costs if the appeal succeeded. The contention that the untaxed Shs.26 million figure alone justified stay 'stands on quick sand'. The motion dated 10th July 2015 was dismissed with costs to the respondent. The decision below was not disturbed; the related substantive appeal was not before the Court.

Key legal issues

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01

Arguability of the intended appeal against the striking out of the applicant's suit for default in supplying documents ordered on discovery

Holding

The Court found one arguable point: whether the learned judge was right to hold the requested documents relevant.

Reasoning

The High Court judge had ordered the applicant to supply specified documents within a limited period, in default the suit to be struck out; the suit was struck out. Whether the judge was right to find the documents relevant was an arguable point, and a single arguable point suffices under Rule 5(2)(b).

p. 3
02

Whether the appeal would be rendered nugatory if taxation of the respondent's bill of costs proceeded

Holding

No - the nugatory limb failed and the application was dismissed.

Reasoning

The bill of about Shs.26 million had not been taxed, so the amount payable was unknown. The applicant, a large foreign bank, did not respond to the respondent's invitation to identify contested items and did not seek stay at the High Court. The contention that the untaxed sum was colossal and would jeopardize operations 'stands on quick sand'.

p. 3

Legal principles established

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  • To succeed under Rule 5(2)(b), an applicant must establish both an arguable appeal and that the appeal will be rendered nugatory if stay or injunction is not granted; failing either limb, the application fails.
  • A single arguable point suffices to satisfy the arguability threshold under Rule 5(2)(b).

Court orders

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  1. 1.The motion dated 10th July, 2015 is dismissed
  2. 2.Costs of the application to the respondent

Authorities

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Legislation

  • Appellate Jurisdiction Act, Cap 9Section 3(2)
  • Appellate Jurisdiction Act, Cap 9Section 3A
  • Appellate Jurisdiction Act, Cap 9Section 3B
  • Court of Appeal Rules, 2010Rule 1(2)
  • Court of Appeal Rules, 2010Rule 5(2)(b)
  • Court of Appeal Rules, 2010Rule 42
  • Constitution of Kenya, 2010Article 159(2)

Cases cited (5)

  • Reliance Bank Ltd v Norlake Investments Ltd
    [2002] 1 EA 227
  • Patrick Mweu Musimba v Richard N. Kalembe Ndile & 3 Others
    [2013] eKLR
  • Githunguri vs Simba Credit Corporation Ltd
    2 [1988] KLR 838
  • J. K. Industries Ltd vs Kenya Commercial Bank Ltd
    [1982-88] 1088
  • Ishmael Kagunyi Thande vs Housing Finance of Kenya Ltd
    [2006] eKLR 1
On appeal from
High Court of Kenya at Nairobi
HCCC. No. 3 of 2012
Jurisdiction invoked
Sections 3(2), 3A, 3B of the Appellate Jurisdiction Act, Cap 9; Rules 1(2), 5(2)(b), 42 of the Court of Appeal Rules, 2010; Article 159(2) of the Constitution

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, "ABN Amro Bank N.V v Kenya Pipeline Company Limited [2015] KECA 150 (KLR)", Case Analysis (2015). Civil Application No. NAI. 191 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2015/150/eng@2015-12-11

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