Skip to content
AI-generated case briefs sourced from Kenya Law · Not legal advice
AI-generated case brief
Case Brief · caselaw.co.ke
ELCPartially AllowedNot stated in judgment· [2019] KEELC 2049 (KLR)

Equatorial Land Holdings Limited & another v Cheseret Arap Korir [2019] KEELC 2049 (KLR)

High Court of Kenya
23 July 2019
601 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~2 min to read original · ~4 min brief

The bottom line

#

A Kenyan High Court confirmed that court orders protecting land pending arbitration automatically end once the arbitrator issues a final award.

What this practically means

#

Executive summary

#
Equatorial Land Holdings Limited and Karebe Gold Mining Limited applied to discharge, vacate or set aside interlocutory orders issued on 1st March 2019 by the High Court at Eldoret restraining the 1st plaintiff from carrying on any activity on suit parcels of land pending the outcome of arbitration. The applicants contended that the arbitral proceedings had concluded, with a final award delivered on 30th April 2019, in which the arbitrator found the defendant contractually bound to honour clause 2.2 of the lease agreement dated 12th June 2009, including renewal of the lease for a further 10 years from 22nd January 2019. Only costs and damages remained outstanding in the arbitration, and the respondent had not paid the arbitration costs of Kshs. 503,500. The respondent opposed, arguing the award was incomplete on the issue of rent, that it had challenged the award, that the applicants had not deposited Kshs. 2,000,000 previously ordered, and that discharge would prejudice it. Ombwayo J held that the interlocutory orders were tied to the pendency of the arbitration and lapsed upon the making of the award, observing that the court could not force the parties to agree on the outstanding rent. The court discharged the restraining orders but, in the interest of justice, directed the applicants to deposit Kshs. 3,000,000 in a joint interest-earning fixed account within 14 days as security for rent pending the hearing of the application dated 6th May 2019. Costs of the application were awarded to the applicants. Judgment delivered at Eldoret on 23rd July 2019.

Key legal issues

#
01

Whether interlocutory orders pending arbitration survive the arbitral award

Holding

The orders lapse once the award is made

Reasoning

The court had issued interlocutory restraining orders solely to preserve the status quo pending the outcome of the arbitration. Since the purpose of the orders was tied to the pendency of the arbitral proceedings, the making of the award on 30th April 2019 exhausted their purpose. The court held it could not force the parties to agree on rent, an issue left open by the arbitrator, and therefore the orders could not be maintained.

p. 2
02

Whether discharge of the orders should be conditioned to protect the respondent

Holding

A deposit of Kshs. 3,000,000 was ordered as security for rent pending the hearing of a pending application

Reasoning

Although the court found the restraining orders had lapsed, it balanced the respondent's claim that rent remained undetermined and that discharge would enable the applicants to resume operations. In the interest of justice, the discharge was accompanied by a condition that the applicants deposit Kshs. 3,000,000 in a joint interest-earning fixed account as security for rent pending determination of the application dated 6th May 2019.

p. 2

Legal principles established

#
  • Interlocutory restraining orders issued pending arbitration lapse upon the making of the arbitral award

Court orders

#
  1. 1.The interlocutory orders issued on 1st March 2019 restraining the plaintiffs from carrying on any activity on the suit parcels of land are discharged as the arbitral award has already been made
  2. 2.The applicants to deposit Kshs. 3,000,000 in a joint interest earning fixed account to be opened within 14 days in the names of the advocates on record at the Kenya Commercial Bank, Eldoret branch as security for rent, pending the hearing of the application dated 6th May 2019
  3. 3.Costs of the application to the applicant
Jurisdiction invoked
Inherent powers of the High Court to regulate its interlocutory orders pending arbitration (not expressly cited in the judgment)

Key timeline

#

Practical implications

#

Frequently asked questions

#

Cite this brief

#

Cite this brief

Caselaw, "Equatorial Land Holdings Limited & another v Cheseret Arap Korir [2019] KEELC 2049 (KLR)", Case Analysis (2019). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2019/2049/eng@2019-07-23

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