Gilgil Treatment Industries Ltd v Bank of India & another (Civil Application E052 of 2026) [2026] KECA 1556 (KLR)
The bottom line
#Kenya's Court of Appeal refused to block the sale of Gilgil Treatment Industries' properties, ruling the bank can compensate the company if its appeal succeeds.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the intended appeal is arguable under rule 5(2)(b)
- 2.Whether the intended appeal would be rendered nugatory if the orders of stay/injunction are not granted
- 3.(Raised but not determined) Whether the multiplicity of proceedings by the applicant amounts to abuse of the Court's process
Key legal issues
#Arguability of the intended appeal
The intended appeal was arguable because it raised non-frivolous questions on the validity of statutory notices under sections 90 and 96 of the Land Act and the application of interlocutory injunction principles
The Court applied the settled low threshold: an arguable appeal is not one that must succeed but one that is not frivolous and deserves fuller consideration. The Court declined to assess the grounds against the High Court ruling, holding that this duty lies with the bench that will hear the intended appeal; its task at the rule 5(2)(b) stage is only to determine whether the issues raised are not frivolous.
Whether the appeal would be rendered nugatory
The appeal would not be rendered nugatory: the properties are charged securities, the applicant conceded indebtedness, and the respondent bank can compensate in damages
Relying on Shah v Diamond Trust Bank and Muga Developers, the Court held that where the value of charged property is determinable and the chargee is a reputable financial institution capable of paying damages, exercise of the statutory power of sale does not render a successful appeal nugatory. Counsel for the applicant conceded the applicant owed the respondent money, and the applicant did not rebut the respondents' arguments on compensability.
Abuse of process through multiplicity of proceedings
The Court declined to determine the abuse-of-process allegation as it was unnecessary once the twin test failed
The respondents alleged that the applicant and proxies had filed multiple applications and suits over the same matter. Having found the application failed on the rule 5(2)(b) threshold, the Court expressly declined to decide the abuse question, leaving it open. The applicant had argued that exercising a lawful right of appeal cannot, without more, constitute abuse of process.
Legal principles established
#- An applicant under rule 5(2)(b) must satisfy the twin test: an arguable appeal and that the appeal will be rendered nugatory absent stay
- An arguable appeal need not succeed; it is sufficient that a single bona fide arguable ground is raised
- Where charged property is the subject of the application and the chargee is a reputable financial institution able to pay damages, an intended appeal is not rendered nugatory by exercise of the statutory power of sale
Court orders
#- 1.The notice of motion dated 7th April 2026 is dismissed with costs to the respondents
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court of Kenya
- Jurisdiction invoked
- Rule 5(2)(b) of the Court of Appeal Rules, 2022
Relief refused
#Orders restraining the respondents from selling, advertising for sale, alienating or otherwise dealing with L.R. Nos. Eldoret Municipality Blocks 9/2501, 9/2502 and 9/2522 pending the intended appeal
The applicant failed to satisfy the twin principles under rule 5(2)(b); although the appeal was arguable, it would not be rendered nugatory as the charged properties are compensable in damages and the respondent bank is capable of paying
Costs
The notice of motion dated 7th April 2026 is dismissed with costs to the respondents
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
In conclusion, we find that since the applicant has failed to satisfy the twin principles for grant of relief under rule 5(2)(b), its motion must fail. The notice of motion dated 7th April 2026 is therefore dismissed with costs to the respondents.
For an applicant to successfully move the Court for an order of stay of execution, an injunction or stay of proceedings, an arguable appeal must be disclosed, and in addition, the applicant must demonstrate that without an order of stay, the appeal will be rendered nugatory.
It is not for us to assess these grounds against the ruling of the learned Judge, for that duty lies with the bench of the Court that will eventually be tasked with hearing the intended appeal.
On the nugatory aspect, the concern is whether what is sought to be stayed if allowed to happen is reversible; or if it is not reversible, whether damages will reasonably compensate the party aggrieved.
The respondent is a licensed financial institution, and it has not been demonstrated that it is not capable of compensating the applicant, if successful.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Gilgil Treatment Industries Ltd v Bank of India & another (Civil Application E052 of 2026) [2026] KECA 1556 (KLR)", Case Analysis (2026). Notice of Motion dated 7th April 2026 (Court of Appeal, Eldoret). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1556/eng@2026-07-31
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.