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Court of AppealAllowedCivil Application No. 89 of 2016 (UR 66 of 2016)· [2017] KECA 750 (KLR)

Kenya Methodist University v Mary Kaungania & Another

Court of Appeal
1 March 2017
RNR.N. NambuyeHOH.M. OkwenguPKP.O. Kiage
2,503 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Court of Appeal paused a Kshs. 46 million employment award against Kenya Methodist University because the winners couldn't show they could refund the money if the appeal succeeded.

What this practically means

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Executive summary

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This is a ruling of the Court of Appeal at Nyeri (Nambuye, Okwengu and Kiage, JJA) on a Notice of Motion dated 22 November 2016 by Kenya Methodist University seeking, under sections 3A and 3B of the Appellate Jurisdiction Act and rule 5(2)(b) of the Court of Appeal Rules 2010, a stay of further proceedings, computation and execution in Nyeri ELRC Cause No. 4 of 2016 consolidated with Cause No. 5 of 2016, pending an intended appeal against a judgment finding unfair termination of two church workers seconded to the university by the Bishop of the Methodist Church of Kenya. The court restated the settled twin criteria: the applicant must show the appeal is arguable and that it will be rendered nugatory if stay is withheld, both limbs being mandatory. It found four arguable grounds, including whether secondment created an employer/employee relationship and whether the learned Judge erred in directing computation of the decretal sum. On nugatory impact, the respondents' tentative computations totalled over Kshs. 46 million; the court held that mere assertion that the decretal figure had not crystallized was insufficient, and the respondents should have demonstrated how the colossal sums would be secured and refundable if the appeal succeeded. Finding both limbs satisfied, the court allowed prayer 3 as prayed and ordered costs of the application to abide the outcome of the intended appeal.

Key legal issues

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01

Arguability of the intended appeal

Holding

The intended appeal was arguable on grounds including whether secondment gave rise to an employer/employee relationship and whether the Judge erred in directing computation of the decretal sum.

Reasoning

The court found a Notice of Appeal on record anchoring the application. The draft memorandum raised four grounds, including recall of secondment by the Bishop, whether secondment created employment, freedom of contract, and the computation direction. A single bona fide arguable point suffices; the applicant satisfied the first ingredient.

p. 4
02

Whether the appeal would be rendered nugatory

Holding

The appeal would be rendered nugatory because the respondents failed to show the colossal decretal sums would be secured and refundable if the appeal succeeded.

Reasoning

The tentative computations exceeded Kshs. 42 million for the 1st respondent and Kshs. 4.7 million for the 2nd. Mere assertion that the decretal figure had not crystallized was insufficient; the onus was on the respondents to rebut the impecuniosity/recovery claim with evidence of security. Failure led to the conclusion of undue hardship and nugatory impact.

p. 4

Legal principles established

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  • An applicant under rule 5(2)(b) must satisfy both the arguability and nugatory-impact limbs; one arguable point suffices.
  • Where an applicant alleges an appeal will be rendered nugatory due to the respondent's inability to refund a colossal decretal sum, the respondent must demonstrate by evidence how the amount would be secured.

Court orders

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  1. 1.Prayer 3 of the Notice of Motion dated 22 November 2016 allowed as prayed - stay of any further proceedings, further computation and/or quantification or execution of the respondents' claim in ELRC Cause No. 4 of 2016 consolidated with Cause No. 5 of 2016 pending the hearing and determination of the intended appeal
  2. 2.Costs of the application to abide the outcome of the intended appeal

Authorities

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Legislation

  • Appellate Jurisdiction ActSections 3A and 3B
  • Court of Appeal Rules 2010Rule 5(2)(b)
  • Court of Appeal Rules 2010Rule 75
  • Court of Appeal Rules 2010Rule 82(2)
  • Court of Appeal Rules 2010Rule 87(1)

Cases cited (17)

  • Equity Bank Limited versus West Link Mbo Limited
    [2013] eKLR

    Rule 5(2)(b) is a procedural innovation for preservation of the subject matter of an appeal

  • Nguruman Limited versus Shompole Group Ranch & Another
    [2014] eKLR

    Rule 5(2)(b) power exercisable only where a notice of appeal has been lodged under rule 75

  • Kenya Tea Growers Association & Another versus Kenya Plantation and Agricultural Workers Union
    [2012] eKLR

    Twin principles: arguability and nugatory impact under rule 5(2)(b)

  • Reliance Bank Limited versus Norlake Investments Limited
    [2002] EA 226

    Nugatory impact assessed on the circumstances of each case; 'nugatory' does not mean worthless

  • 748 Air Services Limited versus Theuri Munyi
    [2014] eKLR

    Money decree can render an appeal nugatory where recovery of paid-out sums is doubtful

  • Githunguri versus Jumba Credit Corporation Ltd No.(2)
    [1988] KLR 88

    Rule 5(2)(b) jurisdiction is original, wide, independent, unfettered and discretionary

  • Reuben & 9 Others versus Nderitu & Another
    [1989] KLR 459

    Nature of rule 5(2)(b) jurisdiction

  • Safaricom Ltd versus Ocean View Beach Hotel Ltd & 2 others
    Civil Application No. 327 of 2009 UR

    Jurisdiction under rule 5(2)(b) arises only where a notice of appeal is lodged

  • Kenya Tea Growers Association & another versus Kenya Planters Agricultural Workers Union
    Civil Application No. Nai 72 of 2001 (UR)

    Arguable appeal need not necessarily succeed but raises a bona fide issue

  • Joseph Gatahi Gachau & Another versus Pioneer Holdings (A) Ltd & 2 Others
    Civil Application No. 24/2008

    Meaning of arguable appeal

  • Damji Pragiji Mandavia versus Sara Lee Household & Body Care (K) Ltd
    Civil Application No. Nai 345 of 2005 (UR)

    A single bona fide arguable point is sufficient

  • Kenya Railways corporation versus Edernan Properties Ltd
    Civil Appeal No. Nai 176 of 2012

    One arguable point suffices

  • Ahmed Musa Ismael versus Kimba Ole Ntamorua & 4 others
    Civil Appeal No. Nai 256 of 2013

    One arguable point suffices

  • Stanley Kangethe Kinyanjui versus Tony Ketter & 5 others
    CA No. 31 of 2012

    Test for whether an appeal will be rendered nugatory

  • David Morton Silverstein Versus Atsango Chesoni
    Civil Application No. Nai 1989 of 2001

    Each case depends on its own facts and peculiar circumstances

  • International Laboratory for Research on Animal Diseases Versus Kinyua
    [1990] KLR 403

    Onus shifts to respondent to rebut impecuniosity claim by evidence

  • Republic versus Kenya Anti Corruption Commission & 2 others
    [2009] KLR 31

    Applicant must satisfy both limbs of rule 5(2)(b)

On appeal from
Employment and Labour Relations Court at Nyeri
Cause No. 4 of 2016 consolidated with Cause No. 5 of 2016
Jurisdiction invoked
Sections 3A and 3B of the Appellate Jurisdiction Act Cap 9 and Rule 5(2)(b) of the Court of Appeal 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 (3)

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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, "Kenya Methodist University v Mary Kaungania & Another", Case Analysis (2017). Civil Application No. 89 of 2016 (UR 66 of 2016). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2017/750/eng@2017-03-01

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