Muka Mukuu Farmers Cooperative Society Limited v Stephen Mwanzia Kithuka & 2 others [2021] KEELC 4525 (KLR)
The bottom line
#What this practically means
#Executive summary
#Key legal issues
#Substantial loss for stay of execution under Order 42 Rule 6(2)
No substantial loss to the Appellant; the stay of the quarry lease causes no loss while the Respondents and members would suffer loss if the illegally-constituted committee dealt with the land
The court, guided by Kenya Shell Ltd and Butt v Rent Restriction Tribunal, weighed whether the appeal would be rendered nugatory. Since the Appellant's Management Committee had proposed to lease about 600 acres for quarrying, and quarrying has irreversible consequences on land, staying the lease pending appeal causes the Appellant no substantial loss, whereas the Respondents and membership would suffer if the committee's legality is later impugned.
Interim freezing orders versus payment of salaries and statutory deductions
The Management Committee, whose legality is yet to be determined, cannot deal with the finances generally, but may access accounts solely to pay salaries, wages, utility bills and statutory deductions
The court held that whether the Committee is legally in office is for the Tribunal, and until then it cannot deal with finances and accounts generally. However, salaries and statutory deductions fall due irrespective of the outcome and cannot await determination of the appeal, so a limited carve-out was granted consistent with the interim orders of the Tribunal.
Stay of proceedings before the Tribunal
Stay of proceedings declined; the parties should proceed expeditiously per the Tribunal's directions
The Tribunal had directed parties to file witness statements and documents within 21 days and to have the claim heard and concluded expeditiously on a priority basis within 60 days. In view of those directions, the court declined to stay proceedings, holding the parties should abide by them and ventilate their respective cases expeditiously.
Merits of the pending appeal at interlocutory stage
The court declined to delve into the merits of the appeal, confining itself to the stay criteria
Although the parties argued the merits of the pending appeal at length, including the legality of the Management Committee and compliance with the by-laws, the court held that those issues should be dealt with when hearing the appeal, and at this stage only the stay criteria (substantial loss, delay, security) fell for determination.
Legal principles established
#- Substantial loss is the cornerstone of the jurisdiction for granting stay of execution pending appeal
- A court exercising discretion on stay ought to ensure the appeal, if successful, is not rendered nugatory
- An interim order does not bar payment of employee salaries and statutory deductions, which fall due irrespective of the dispute
Court orders
#- 1.The Notice of Motion dated 3rd August, 2020 is dismissed with costs
- 2.Pending the hearing and determination of the Appeal, the Appellant, its authorized agents, officials and or employees may access the Appellant's bank accounts and finances for the purpose of paying outstanding and continuing salaries, wages, utility bills and statutory deductions only, and not for any other purpose not specified in the order
- 3.Each party to bear its own costs
- On appeal from
- Cooperative Tribunal, Nairobi
- 150 of 2020
- Jurisdiction invoked
- Appellate jurisdiction over decisions of the Cooperative Tribunal under the Co-operative Societies Act; application brought under Order 42 Rule 6(2) of the Civil Procedure Rules
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (2)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Obita v Teacher Service Commission & another (Petition E004 of 2025) [2025] KEELRC 1784 (KLR)[2025] KEELRC 1784 (KLR)17 Jun 2025
- Kyeleni Valley Ventures Limited v Muka Mukuu Farmers Cooperative Society Ltd [2021] KEELC 795 (KLR)[2021] KEELC 795 (KLR)22 Nov 2021
Cite this brief
#Cite this brief
Caselaw, "Muka Mukuu Farmers Cooperative Society Limited v Stephen Mwanzia Kithuka & 2 others [2021] KEELC 4525 (KLR)", Case Analysis (2021). Tribunal Case No. 150 of 2020 (Appeal therefrom). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2021/4525/eng@2021-01-29
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.