Skip to content
AI-generated case briefs sourced from Kenya Law · Not legal advice
Caselaw
AI-generated case brief
Case Brief · caselaw.co.ke
ELRCDismissedNot stated in the judgment as provided· [2020] KEELRC 388 (KLR)

Manuchar Kenya Limited v Dennis Odhiambo Olwete [2020] KEELRC 388 (KLR)

Employment and Labour Relations Court of Kenya at Mombasa (sitting in its appellate capacity)
15 October 2020
LNLinnet Ndolo
1,524 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~6 min to read original · ~4 min brief

The bottom line

#

A Kenyan court refused to freeze released funds because the losing party waited 28 days, proved no loss, and offered no security.

What this practically means

#

Executive summary

#
This is a ruling by Linnet Ndolo, Judge, of the Employment and Labour Relations Court at Mombasa, sitting in its appellate capacity, on the Respondent's Notice of Motion dated 27th August 2020 seeking stay of execution of the Court's order of 30th July 2020, which directed that assets, including money held on account of the judgment of the lower court, be released to the Appellant. The Respondent, who had lodged a notice of appeal dated 12th August 2020, argued through its Advocate Richard Mbuya that release of Kshs. 391,890 held in a joint interest earning account would render its intended appeal to the Court of Appeal nugatory, and that the appeal had significance for WIBA matters across the Republic. The Appellant, through its Legal Manager Aloice Muoki, countered that it was the successful party in the concluded appeal; that the funds had been deposited by the Appellant itself as security for stay granted by the lower court; that the Respondent delayed 28 days in moving the Court; that no substantial loss was demonstrated and no security was offered; and that the Respondent's Advocate lacked capacity to swear to its loss. Applying Order 42 Rule 6(1) and (2) of the Civil Procedure Rules, the Court held that the duty to post security lies on the party seeking stay, not the countering party, and that the legal burden of demonstrating inability to settle a decretal sum lies with the party moving the Court. The application was found without merit and disallowed; the interim orders of 31st August 2020 were discharged; costs were awarded as costs in the appeal before the Court of Appeal.

Key legal issues

#
01

Whether substantial loss and unreasonable delay were established for grant of stay pending appeal

Holding

The application failed: the Respondent, who lost the appeal before this Court, sought to lock the decretal funds deposited by the successful Appellant as security, without showing substantial loss or offering security itself

Reasoning

The Court applied Order 42 Rule 6(1) and (2), which requires substantial loss, absence of unreasonable delay, and security from the applicant. The Respondent took 28 days to move the Court despite being represented at judgment delivery. The money was deposited by the Appellant to satisfy the stay condition set by the lower court; the Respondent could not convert that deposit into security for its own appeal. No plea was made that the Appellant would be unable to satisfy any award of the Court of Appeal, the Respondent being required to prove such inability.

p. 2
02

Whether the appeal would be rendered nugatory if stay is declined

Holding

No nugatory effect was established because substantial loss was not demonstrated and the Appellant was shown to be a profitable company with attachable assets

Reasoning

Counsel for the Appellant relied on authority that where substantial loss has not been established, it cannot be said that an appeal will be rendered nugatory. The Court found nothing to suggest the Appellant would be unable to satisfy an award that may be made against it by the Court of Appeal; the Respondent did not even plead such inability. The Respondent company's advocate also lacked capacity to swear to the loss his client would suffer, there being no affidavit by the Respondent itself.

p. 2

Legal principles established

#
  • The duty to post security under Order 42 Rule 6(1) and (2) of the Civil Procedure Rules lies on the party seeking stay of execution, not the countering party
  • The legal burden of demonstrating inability or financial limitation to settle a decretal sum lies with the party moving the Court

Court orders

#
  1. 1.The Respondent's Notice of Motion dated 27th August 2020 is found to be without merit and is disallowed
  2. 2.The interim orders granted on 31st August 2020 are discharged
  3. 3.The costs of the application will be costs in the appeal before the Court of Appeal

Authorities

#

Legislation

  • Civil Procedure RulesOrder 42 Rule 6 (1) and (2)

Cases cited (3)

  • Shell Limited v Benjamin Karuga Kibiru & another
    [1986] eKLR 410
  • Micro Enterprises Support Programme Trust Registered Trustees v Mayford Savings & Credit Cooperative Society Limited & 5 others
    [2013] eKLR
  • Winfred Nyawira Maina v Peterson Onyiego Gichana
    [2015] eKLR
On appeal from
Lower court (trial court / superior special court; court not named in the judgment)
Not stated
Jurisdiction invoked
Appellate jurisdiction over the lower court's judgment, with the stay application brought under Order 42 Rule 6 (1) and (2) of the Civil Procedure Rules

Key timeline

#

Practical implications

#

Frequently asked questions

#

Cite this brief

#

Cite this brief

Caselaw, "Manuchar Kenya Limited v Dennis Odhiambo Olwete [2020] KEELRC 388 (KLR)", Case Analysis (2020). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/388/eng@2020-10-15

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