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Court of AppealDismissedCivil Application (Nairobi) arising from Notice of Motion dated 14th December 2023· [2024] KECA 513 (KLR)

J&K Investments Limited v Gazemba Wekesa & Co Advocates (Civil Application E587 of 2023) [2024] KECA 513 (KLR)

Court of Appeal of Kenya
26 April 2024
SKS. Gatembu KairuFTF. TuiyottFNF. W. Ngunjiri
2,581 words in judgment
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The bottom line

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The Court of Appeal refused to stop garnishee execution of a Kshs.35.5 million legal fees decree because the company's intended appeal had no arguable grounds.

What this practically means

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Executive summary

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Before the Court of Appeal was a Notice of Motion by J & K Investments Limited under rule 5(2)(b) of the Court of Appeal Rules seeking stay of execution of a High Court ruling (Majanja, J, 27th October 2023) which dismissed the applicant's application to set aside a remuneration agreement and allowed the respondent advocate's claim for Kshs.35,500,000 in legal fees arising from arbitration proceedings, plus costs capped at Kshs.150,000 with interest. A decree was extracted on 7th December 2023 and the respondent commenced garnishee proceedings against the applicant's three bank accounts, obtaining a garnishee nisi order, prompting the application for stay. The applicant argued the intended appeal was arguable on grounds that the remuneration agreement was procured by coercion, that a separate consultancy agreement governed fees, that the fees were exorbitant, and that the High Court lacked jurisdiction in light of an arbitration clause; it also contended that the garnishee proceedings would render the appeal nugatory. The respondent countered that only Kshs.63,610 was recovered from the garnishee, that it was a firm of reputable standing capable of refunding, and that the applicant, a foreign national with no known Kenyan assets, should at least pay uncontested fees of Kshs.19,872,010.20 as security. The Court, applying the conjunctive twin principles under rule 5(2)(b), found the appeal was not arguable, declined to make definitive findings on the merits, and held that the nugatory limb fell away, the decree being monetary and compensable. The application was dismissed with costs to the respondent.

Key legal issues

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01

Whether the intended appeal is arguable

Holding

The appeal is not arguable; none of the proposed grounds (separate fee agreement, coercion, exorbitant fees, lack of jurisdiction) rises above frivolity on the material placed before the Court

Reasoning

The Court reviewed the proposed grounds against the High Court ruling and the record. The applicant did not annex any fee settlement agreement to its application, while the respondent annexed the consultancy agreement of 18th January 2021 with its addendum. On that record, the Court could not find a single arguable point, noting that at this stage it avoids definitive findings so as not to embarrass the main appeal.

p. 5
02

Whether the appeal would be rendered nugatory without stay

Holding

The nugatory limb need not be addressed because the first limb failed; in any event the decree is monetary and compensable, and the respondent, a firm of reputable standing, could refund the money if the appeal succeeded

Reasoning

The Court held that the second limb falls away automatically once the first limb fails. It further observed that this is a monetary decree which can be compensated; counsel for the respondent confirmed the firm could refund any money if the appeal succeeded, and the applicant did not depose that the respondent could not refund.

p. 5

Legal principles established

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  • The twin principles under rule 5(2)(b) — arguability and nugatory effect — must be established conjunctively, not disjunctively, and to the Court's satisfaction
  • A single arguable point suffices; the Court will not delve into the merits of the appeal at the stay stage

Court orders

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  1. 1.The Notice of Motion is dismissed with costs to the respondent

Authorities

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Legislation

  • Court of Appeal Rulesrule 5(2)(b)

Cases cited (5)

  • Trust Bank Limited & Another v Investech Bank Limited & 3 Others
    (2000) eKLR
  • Stanley Kang’ethe Kinyanjui v Tony Ketter & 5 Others
    (2013) eKLR
  • Opiyo & 123 Others v Teleposta Pension Scheme Registered Trustees
    (Civil Application No. E276 of 2022) (2022) KECA 1276 (KLR)
  • Mungai v Mwangi Keng’ara & Co. Advocates
    (Civil Application No. E407 of 2022) (2023) KECA 1328 KLR
  • R. K. K. v M. W. K. & 2 others
    (2016) eKLR
On appeal from
High Court of Kenya
Nairobi High Court Misc. Comm. Application No. 377 of 2023 consolidated with Misc. Comm. Application E437 of 2023
Jurisdiction invoked
Rule 5(2)(b) of the Court of Appeal Rules, 2010 (now Rules, 2022)

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, "J&K Investments Limited v Gazemba Wekesa & Co Advocates (Civil Application E587 of 2023) [2024] KECA 513 (KLR)", Case Analysis (2024). Civil Application (Nairobi) arising from Notice of Motion dated 14th December 2023. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2024/513/eng@2024-04-26

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