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ELCPartially AllowedNot stated in judgment· [2019] KEELC 1818 (KLR)

Noorlands Ltd v Kenya Power Lighting Co. Ltd [2019] KEELC 1818 (KLR)

Environment and Land Court
27 June 2019
802 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Mombasa court stopped enforcement of a land judgment because the winner might not be able to repay the money if the appeal succeeds.

What this practically means

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Executive summary

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The defendant applicant moved the Environment and Land Court at Mombasa by Notice of Motion dated 22nd November 2016 under Order 42 rule 6, seeking stay of the judgment delivered on 4th November 2016 pending appeal, on grounds that an appeal had been filed, stay was needed to avoid the appeal being rendered nugatory, the applicant was willing to provide security, and the application was made without undue delay. The plaintiff/respondent, through a replying affidavit sworn by Mohamed Khatib holding a power of attorney, opposed the application, arguing that the defendant was still supplying power to connected squatters, that stay requires proof of substantial loss, and that the 168-acre suit land was sufficient to reimburse the defendant. The defendant relied on Superior Homes (K) Ltd v Musango Kithome (2018) eKLR, stressing that the plaintiff's location and bank details were unknown. The court held the application was filed without undue delay, since Order 42 rule 6 concerns the time of filing, not prosecution, and the file had been engaged in taxation. On substantial loss, the court, having visited the land and found it fully occupied by squatters, inferred that recovery of monies from the plaintiff through the land would not be easy, validating the defendant's fears. The defendant, a going concern willing to provide security, was granted stay in terms of prayer 3 conditional on depositing half the decretal sum in a joint escrow account within 45 days. Costs were ordered in the cause.

Key legal issues

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01

Whether the stay application was brought without undue delay

Holding

The application filed in the same month as the judgment was made without undue delay; delay in prosecution did not count

Reasoning

The court held that Order 42 rule 6 is concerned with the time of bringing the application to court, not the time of prosecuting it. The application was filed in November 2016, the same month as the judgment. Further, the court file was engaged in taxation before the Deputy Registrar, so it could not proceed in the two forums simultaneously.

p. 2
02

Whether the defendant would suffer substantial loss

Holding

Yes - the defendant's fear of non-recovery of the decretal sum was a good ground of substantial loss

Reasoning

The plaintiff relied on the value of the 168-acre suit land to show financial capacity. Having visited the land, the court found it fully occupied by squatters, making recovery of monies through the land difficult. The plaintiff's whereabouts and financial details were also unknown, so the defendant's fear of non-recovery in the event of a successful appeal was well founded.

p. 2
03

What security should accompany the stay

Holding

Half the decretal sum to be deposited in a joint escrow account within 45 days

Reasoning

The defendant was a going concern and had offered security. Balancing the parties' interests, the court directed half the decretal sum to be deposited in an escrow account in the joint names of the parties' advocates, held as security pending the hearing and determination of the appeal, with a 45-day compliance window.

p. 2

Legal principles established

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  • An application for stay under Order 42 rule 6 is measured by when it is filed, not when it is listed for hearing
  • Difficulty of recovering a decretal sum from a respondent, where the suit land is occupied by squatters, constitutes substantial loss

Court orders

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  1. 1.Stay of the judgment delivered on 4th November 2016 granted in terms of prayer 3 of the application, conditional on provision of security
  2. 2.Half of the decretal sum to be deposited in an escrow account in the joint names of the parties' advocates as security pending appeal, within 45 days
  3. 3.Costs of the application ordered in the cause

Authorities

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Legislation

  • Civil Procedure RulesOrder 42 rule 6

Cases cited (1)

  • Superior Homes (K) Ltd –versus- Musango Kithome
    (2018) eKLR
Jurisdiction invoked
Order 42 rule 6 of the Civil Procedure 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, "Noorlands Ltd v Kenya Power Lighting Co. Ltd [2019] KEELC 1818 (KLR)", Case Analysis (2019). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2019/1818/eng@2019-06-27

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