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ELCPartially AllowedNot stated in judgment· [2021] KEELC 2717 (KLR)

Desterio Nyongesa Wanyama v Gilbert Wesonga Mugeni & another [2021] KEELC 2717 (KLR)

Environment and Land Court (presumed from judge's designation; judgment does not state court)
30 June 2021
1,133 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Busia court let a businessman pay Kshs.315,076 in taxed costs in five monthly instalments, but stressed debtors must show proof of finances and genuine effort.

What this practically means

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Executive summary

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The applicant, Gilbert Wesonga Mugeni, moved the court by an application dated 17th March 2021 under Order 12 rule 12(1) & (2) of the Civil Procedure Rules and section 3A of the Civil Procedure Act, seeking leave to liquidate taxed costs of Kshs.315,076 by monthly instalments of Kshs.10,000, with liberty to pay off any outstanding balance in a lump sum, and that costs be costs in the cause. He deposed that he did not contest the taxed costs but was distressed by lean economic times affecting his business, compounded by court-ordered deposit of rents into court, and that warrants of arrest had been taken out against him. The respondent opposed, contending the application was an abuse of process, guilty of laches, unsupported by an affidavit of means, and citing Lavington Security Ltd v Nairobi Water & Sewerage Co. Ltd that mere inability to pay is insufficient. The court applied Order 21 Rule 12 and the principles in Freight Forwarders Ltd v Elsek & Elsek (K) Ltd quoting A Rajabali Alidina v Rehmatulla Alidina: the circumstances of the debt, the debtor's conduct, financial position and bona fides. Holding that the applicant only acted after warrants issued, delayed 1½ years after ex-parte taxation, and filed no affidavit of means, the court found insufficient cause for the terms sought. However, taking judicial notice of Covid-19's impact on businesses, it allowed payment in five equal monthly instalments from 20th July 2021, execution to issue on default, with each party bearing their own costs of the application.

Key legal issues

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01

Whether the applicant demonstrated sufficient cause for payment by instalments under Order 21 Rule 12

Holding

The applicant failed to demonstrate sufficient cause for the terms he sought, but the court exercised its discretion in his favour on modified terms

Reasoning

The court applied the criteria in A Rajabali Alidina v Rehmatulla Alidina as adopted in Freight Forwarders Ltd v Elsek & Elsek (K) Ltd: the circumstances of the debt, the debtor's conduct, financial position and bona fides. The applicant only acted after a warrant of arrest issued, delayed 1½ years after taxation, filed no affidavit of means, and proposed a schedule that would take about 3 years. Yet, taking judicial notice of Covid-19's impact on businesses, the court allowed payment in five equal monthly instalments.

p. 2
02

Whether the absence of an affidavit of means defeats an instalment application

Holding

Yes; failure to file an affidavit of means weighed against the applicant

Reasoning

The respondent argued, and the court accepted, that a party seeking discretionary relief must demonstrate source of income and inability to pay. The applicant's own counsel submitted he was a businessman of means, undercutting the claim of hardship. The court noted the absence of the affidavit as a ground for declining the relief as sought.

p. 2
03

Effect of delay and the debtor's conduct on the discretionary relief

Holding

Delay of 1½ years from taxation and inaction until warrants of arrest issued showed conduct insufficient to merit the relief as sought

Reasoning

The court observed the applicant had filed previous applications showing awareness of his obligation, and only took settlement seriously once threatened with committal. The proposed schedule would prolong the decree holder's enjoyment of costs to nearly five years from taxation, which the court found unacceptable, though it still granted relief in the interest of justice.

p. 2

Legal principles established

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  • The power to order payment of a decreed sum by instalments is discretionary and the applicant must show sufficient cause
  • Sufficient cause is assessed by considering the circumstances in which the debt was incurred, the conduct of the debtor, his financial position and his bona fides
  • A judgment debtor seeking discretionary relief must come to equity with clean hands and demonstrate his financial position, ordinarily by affidavit of means

Court orders

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  1. 1.The applicant is allowed to settle the taxed costs in five (5) equal instalments effective from 20th July 2021 and on the 20th of every subsequent month
  2. 2.In default of any one instalment, execution shall issue
  3. 3.Each party to meet their respective costs of the application

Authorities

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Legislation

  • Civil Procedure RulesOrder 12 rule 12(1) & (2)
  • Civil Procedure ActSection 3A
  • Civil Procedure RulesOrder 21 Rule 12(1) & (2)

Cases cited (3)

  • Lavington Security Ltd v. Nairobi Water & Sewerage Co. Ltd
    (2014) eKLR
  • Freight Forwarders Ltd v Elsek & Elsek (K) Ltd
    (2012) eKLR
  • A Rajabali Alidina v. Rehmatulla Alidina & Anor
    (1961) EA 565
Jurisdiction invoked
Order 12 rule 12(1) & (2) of the Civil Procedure Rules and section 3A of the Civil Procedure Act; substantive power under Order 21 Rule 12 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, "Desterio Nyongesa Wanyama v Gilbert Wesonga Mugeni & another [2021] KEELC 2717 (KLR)", Case Analysis (2021). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2021/2717/eng@2021-06-30

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