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ELRCPartially AllowedNotice of Motion dated 1st July 2016 (ELRC, Nairobi)· [2016] KEELRC 722 (KLR)

Timothy Asudi Malwa v E-Gap Solutions Limited [2016] KEELRC 722 (KLR)

Employment and Labour Relations Court
9 September 2016
899 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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What this practically means

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Executive summary

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By a Notice of Motion dated 1st July 2016, the Respondent sought a stay of execution of this Court's judgment of 27th May 2016, delivered in favour of the Claimant, pending an intended appeal. The application, supported by the affidavit of the Respondent's Director, Gibbon Akifuma, was grounded on the existence of an arguable appeal, apprehended irreparable harm, absence of inordinate delay, and an offer to deposit reasonable security. The Claimant opposed the application, deponing that no steps to execute had been taken, that the Respondent had not demonstrated an arguable appeal or risk of the appeal being rendered nugatory, and that he could refund the decretal sum should the appeal succeed. Applying Order 42 Rule 6(2) of the Civil Procedure Rules and the additional case-law condition of an arguable appeal, the Court found the application timely and security offered. On substantial loss, the Court noted this was a cash award and that mere doubt about the Claimant's ability to repay, unsupported by evidence that he was a man of straw, was insufficient. The Court held that a stay application must balance the Respondent's right of appeal against the Claimant's right to enjoy the fruits of judgment. It granted a conditional stay: the Respondent to release 50% of the decretal sum to the Claimant within 14 days, and deposit the balance in an interest-earning account in the joint names of counsel for both parties within 30 days, failing which the stay would automatically lapse. Costs of the application were made costs in the appeal.

Key legal issues

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01

Whether the conditions for stay of execution under Order 42 Rule 6(2) were satisfied

Holding

Yes, on conditions. Delay and security were satisfied; on substantial loss, the Court found no evidence the Claimant could not repay but crafted conditional orders balancing both parties' rights

Reasoning

Order 42 Rule 6(2) requires substantial loss, absence of unreasonable delay and adequate security, supplemented by the requirement of an arguable appeal. The application was filed promptly after judgment and the Respondent offered security. Doubt about the Claimant's ability to repay was unsupported by evidence of insolvency. The Court therefore granted a conditional stay: half the decretal sum released to the Claimant, the balance held in a joint interest-earning account, with automatic lapse on breach.

p. 2
02

Whether the Respondent had an arguable appeal that would be rendered nugatory

Holding

Treated as an arguable appeal; the nugatory risk was addressed through the conditional deposit rather than an outright refusal

Reasoning

Relying on Syner-Med Pharmaceuticals, an arguable appeal need only raise a substantive point. The Respondent had filed a Notice of Appeal. Rather than withhold the fruits of judgment entirely, the Court preserved the subject matter by requiring the balance of the decretal sum to be held in a joint interest-earning account, with the stay lapsing automatically if conditions were breached.

p. 2

Legal principles established

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  • An arguable appeal is one which raises a substantive point, not necessarily one that will succeed when fully ventilated
  • In granting or declining a stay of execution the Court must consider the particular circumstances of each case
  • A judgment debtor's mere assertion that the decree holder cannot repay is insufficient to show substantial loss; stay applications preserve the subject matter rather than block a successful litigant's enjoyment of judgment
  • In determining a stay application the Court must strike a balance between the applicant's right of appeal and the decree holder's right to enjoy the fruits of the judgment

Court orders

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  1. 1.Stay of execution of the judgment of 27th May 2016 granted on conditions
  2. 2.The Respondent to release to the Claimant the equivalent of 50% of the decretal sum within 14 days of the ruling
  3. 3.The balance (equivalent of 50% of the decretal sum) to be deposited in an interest-earning account in the joint names of Counsel for both parties within 30 days of the ruling
  4. 4.Failure to observe any of the conditions shall lead to an automatic lapse of the stay
  5. 5.Costs of the application to be costs in the appeal

Authorities

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Legislation

  • Civil Procedure RulesOrder 42 Rule 6(2)

Cases cited (5)

  • Banking Insurance & Finance Union (Kenya) v Murata Sacco Society Limited
    [2015] eKLR
  • Syner-Med Pharmaceuticals Ltd v Glaxo Group Limited
    [2010] eKLR
  • Butt v Rent Restriction Tribunal
    [1982] KLR 417
  • David Mbugua v Keroche Breweries Ltd
    [2015] eKLR
  • Michael Kiboi Gatumia v Mastermind Tobacco (K) Limited
    [2013] eKLR
Jurisdiction invoked
Order 42 Rule 6(2) of the Civil Procedure Rules (stay of execution pending intended appeal)

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, "Timothy Asudi Malwa v E-Gap Solutions Limited [2016] KEELRC 722 (KLR)", Case Analysis (2016). Notice of Motion dated 1st July 2016 (ELRC, Nairobi). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/722/eng@2016-09-09

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