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Court of AppealDismissedCivil Application No. E032 of 2021· [2021] KECA 387 (KLR)

Pamela Kawira Arunga v NCBA Bank Kenya PLC & 4 others [2021] KECA 387 (KLR)

Court of Appeal
23 July 2021
911 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 refused to stop the removal of a land restriction, ruling you cannot use a title restriction to achieve what a court already denied you.

What this practically means

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Executive summary

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This was an application under Rule 5(2)(b) of the Court of Appeal Rules by Pamela Kawira Arunga seeking a stay of a ruling of the Environment and Land Court (Okongo, J.) delivered on 21st January 2021, which ordered the removal of a restriction she had registered against Title Number Kiambaa/Kihara/2861. The property had been charged to NCBA Bank Kenya PLC to secure banking facilities; on default, the Bank exercised its statutory power of sale and sold the property to the 2nd respondent. The applicant's earlier attempt to restrain the sale by injunction failed on 24th January 2019. She then registered a restriction on the title, prompting the Bank to seek its removal in ELC No. 4 of 2018. The Judge found that the applicant and the 5th respondent had abused the Land Registrar's powers by obtaining through a restriction what they had failed to obtain from the court, declared the restriction baseless, illegal, null and void, and ordered its removal. Applying the settled twin principles - arguability of the intended appeal and the nugatory-ness of its success if stay is refused - the Court of Appeal (Musinga, Kiage and Gatembu Kairu, JJ.A.) was not persuaded the appeal was arguable, noting that it was not open to the applicant to have a restriction placed on the property after losing her injunction application. It further held the appeal would not be rendered nugatory, since the equity of redemption was extinguished and damages would lie if the sale was irregular. The application was dismissed with costs to the Bank.

Key legal issues

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01

Arguability of the intended appeal

Holding

The Court entertained doubts that the intended appeal was arguable: the property was admittedly charged to the Bank, the applicant's injunction application failed, and it was not open to her to have a restriction placed on the property instead.

Reasoning

The Court tested the applicant's grounds against the twin Rule 5(2)(b) principles. It found the facts undisputed: the charge existed, default occurred, and the injunction application was dismissed on 24th January 2019. Having failed in court, the applicant could not obtain via a restriction from the Land Registrar what she failed to obtain from the court. On those facts the Court was not persuaded the appeal was arguable.

p. 2
02

Nugatory value of the intended appeal

Holding

The appeal would not be rendered nugatory absent a stay because the property had been sold and transferred, extinguishing the equity of redemption, and damages would be an adequate remedy if the sale was found irregular.

Reasoning

The Court held that the second limb of the Rule 5(2)(b) test was not satisfied. Since the property had been sold and transferred to the 2nd respondent, the equity of redemption was already extinguished. Even if the applicant's assertion of an irregular sale at gross undervalue were ultimately established, a remedy in damages would be available, so no stay was necessary to preserve the appeal's utility.

p. 2

Legal principles established

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  • An applicant under Rule 5(2)(b) must demonstrate that the intended appeal is arguable and that, if stay is declined and the appeal succeeds, it will be rendered nugatory
  • Where a party fails to obtain an injunction restraining a chargee from exercising its statutory power of sale, it is not open to that party to circumvent the court's decision by procuring a restriction on the title

Court orders

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  1. 1.The application for stay is dismissed
  2. 2.Costs of the application awarded to the 1st respondent

Authorities

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Legislation

  • Court of Appeal RulesRule 5(2)(b)

Cases cited (1)

  • Co-operative Bank of Kenya Limited vs. Banking Insurance & Finance Union (Kenya)
    [2015] eKLR
On appeal from
Environment and Land Court at Nairobi
ELC Case No. 4 of 2018
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, "Pamela Kawira Arunga v NCBA Bank Kenya PLC & 4 others [2021] KECA 387 (KLR)", Case Analysis (2021). Civil Application No. E032 of 2021. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2021/387/eng@2021-07-23

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