Kenard Limited v Julius Mwangi Kihara [2021] KEELC 2744 (KLR)
The bottom line
#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 Applicant's Application dated 13th November 2020, is merited
- 2.Whether the Respondent's Preliminary Objection dated 24th November 2020, is merited
Key legal issues
#Whether the application for stay of execution pending appeal met the Order 42 Rule 6 preconditions
It did not: no draft memorandum of appeal, no security, no evidence of substantial loss, and inordinate unexplained delay of over a month
The Court found no commitment by the Applicant: no draft Memorandum of Appeal was attached, no security offered or proposal to settle, and no payment since the Ruling. Substantial loss was alleged but unsupported by evidence, and the delay from 24th September to 13th November 2020 was unexplained. The Applicant thus failed all preconditions.
Whether the Court had jurisdiction to entertain the application given the functus officio objection and the Arbitration Act
The preliminary objection succeeded: the Court's jurisdiction was ousted by Section 10 of the Arbitration Act and it was functus officio after the Ruling of 24th September 2020
Arbitration is a consensual process and the Act is a complete code; Civil Procedure provisions do not apply to arbitral proceedings. The award became final and binding, no appeal lies against a refusal to set aside an award under Section 35, and courts should not grant orders in futility or unsupported by law.
Legal principles established
#- The Arbitration Act is a complete code; by virtue of Section 10 no court shall intervene in matters governed by the Act, and provisions of the Civil Procedure Act and Rules do not apply to arbitral proceedings
- An arbitral award is final and binding and no recourse is available against it other than as provided by the Arbitration Act
- An applicant for stay of execution must satisfy all the preconditions: substantial loss, no unreasonable delay, sufficient cause and security for due performance
Court orders
#- 1.The Respondent's Notice of Preliminary Objection dated 24th November 2020 is upheld
- 2.The Applicant's Notice of Motion dated 13th November 2020 is found not merited and accordingly fails
- 3.It is so ordered
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- On appeal from
- null (the Ruling of 24th September 2020 was delivered by this same Court; the Applicant has initiated an appeal to the Court of Appeal)
- Jurisdiction invoked
- Order 42 Rule 6 and Order 51 Rule 1 of the Civil Procedure Rules and Section 3A of the Civil Procedure Act, considered against Sections 10, 32A, 35 and 39 of the Arbitration Act
Relief refused
#Stay of Execution of the Ruling dated 24th September 2020 pending hearing of the Application
Applicant failed to satisfy the Order 42 Rule 6 preconditions of sufficient cause, substantial loss, absence of delay and furnishing of security; and the Court lacked jurisdiction given Section 10 of the Arbitration Act
Stay of Execution of the Ruling dated 24th September 2020 pending the Applicant's Appeal
The Court is functus officio and its jurisdiction is ousted by Section 10 of the Arbitration Act; no appeal lies as contemplated
Costs
No costs order appears in the operative orders; the prayer that 'Costs be provided for' was not expressly addressed in the disposition
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.
Consequently, the Court finds that the Applicant's Application dated 13th November 2020, is not merited, and further, the Respondent's Preliminary Objection dated 24th November 2020 is hereby upheld.
this Court's hands are tied for lack of Jurisdiction in this matter.
in light of provisions of Section 10 of the Arbitration Act, all the provisions including the Civil Procedure Act and Rules do not apply to Arbitral proceedings
The Court finds that the Applicant's Application is inordinately delayed and no sufficient explanation has been offered for such inordinate delay.
The offer for a security should come from the Applicant, and it should not be inferred or implied or left to the Court to make an order for security for due performance as that would amount to stepping into the arena of dispute.
Issues in the judgment
#Party role designations are inverted/confusing throughout: the mover of the application (Julius Mwangi Kihara) is labelled 'Respondent/Applicant' while the opposing party is labelled 'Applicant/Respondent'
The judgment refers to 'rule 11 of the Arbitration Rules' in the context of Order 42/51 Civil Procedure Rules reliance, which is unclear as rule 11 of the Arbitration Rules is not otherwise identified
The Court of Appeal case number of the intended appeal and the lower court/arbitration cause case number are not stated in the judgment
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenard Limited v Julius Mwangi Kihara [2021] KEELC 2744 (KLR)", Case Analysis (2021). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2021/2744/eng@2021-07-01
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.