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ELRCAllowedNotice of motion dated September 8, 2022 (arising from Mavoko MCEL No. 98 of 2019)· [2023] KEELRC 635 (KLR)

Endmor Steel Millers Ltd v Mburu (Appeal E14 of 2022) [2023] KEELRC 635 (KLR)

Employment and Labour Relations Court
16 March 2023
2,008 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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This ruling by the Employment and Labour Relations Court at Nairobi (Dr. Jacob Gakeri, Judge) determines a notice of motion dated September 8, 2022 filed by Endmor Steel Millers Ltd, the appellant in a pending appeal against the judgment of Honourable Stephen Jalang'o (Mr) PM in Mavoko MCEL No. 98 of 2019 (John Ngotho Mburu v Endmor Steel Millers Ltd), delivered August 4, 2022, awarding the respondent a decretal sum of Kshs 574,140/=. The applicant sought a stay of execution pending appeal under Order 42 rule 6 of the Civil Procedure Rules, 2010, contending it had an arguable appeal, that the decretal sum would be irrecoverable if paid, and offering security. The respondent opposed, alleging abuse of process and no demonstrated substantial loss, and proposed deposit of the decretal sum in a joint interest-earning account. The court framed a single issue: whether the application was merited. Applying Order 42 rule 6(2), the court found the applicant had demonstrated substantial loss since the respondent had not shown ability to refund the decretal sum (burden shifting under National Industrial Credit Ltd v Francis Wasike); the one-month delay was not unreasonable; and the applicant's readiness to furnish security satisfied the security condition. The court affirmed and extended the interim orders of September 16, 2022 pending the appeal, directed deposit of the decretal amount in a joint interest-earning account within 45 days, required expedition of the record of appeal within 45 days, and ordered that failure to comply would entitle the respondent to execute. Costs were reserved to the appeal.

Key legal issues

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01

Whether the applicant demonstrated substantial loss to justify stay of execution pending appeal

Holding

The applicant demonstrated substantial loss; the respondent did not show ability to refund the decretal sum if the appeal succeeded, shifting the evidential burden to him.

Reasoning

The applicant argued execution was imminent and the decretal sum would be irrecoverable if the appeal succeeded. Under National Industrial Credit Ltd v Francis Wasike, once an applicant expresses reasonable fear that the respondent cannot repay, the burden shifts to the respondent to demonstrate his resources. The respondent here failed to demonstrate ability to repay, as in Victor Ogola v Mary Waithe Kihiu, so substantial loss was established.

p. 4
02

Whether the application was made without unreasonable delay

Holding

The application filed slightly over one month after the judgment was not an unreasonable delay.

Reasoning

The trial judgment was delivered on August 4, 2022 and the application filed on September 9, 2022, slightly over a month later. The court held this was not unreasonable delay, a position the respondent conceded in submissions.

p. 4
03

Whether the applicant's offer of security satisfied Order 42 rule 6(2)(b)

Holding

The applicant's readiness and willingness to furnish security satisfied the condition; the nature of security is a matter for the court's discretion.

Reasoning

The applicant expressed readiness and willingness to furnish security. Relying on Mwaura Karuga (cited by the respondent), the ultimate decree envisaged includes costs and interest, and the rule confers discretion on the court to determine the nature of security while balancing the parties' rights. The court directed deposit of the decretal amount in a joint interest-earning account.

p. 4

Legal principles established

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  • Once an applicant expresses a reasonable fear that a respondent would be unable to pay back the decretal sum, the evidential burden shifts to the respondent to show what resources he has, as a matter peculiarly within his knowledge.
  • Order 42 rule 6(2)(b) confers discretion on the court to determine the nature of security to be furnished in light of the circumstances, balancing the respective rights of the parties.

Court orders

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  1. 1.The interim orders granted on September 16, 2022 are affirmed and extended pending the hearing and determination of the appeal against the judgment in Mavoko MCEL No 98 of 2019
  2. 2.The applicant shall deposit the decretal amount in an interest earning account jointly held by counsels for the parties on record within 45 days
  3. 3.Applicant shall expedite the filing of the record of appeal and take steps to have the same listed for hearing within 45 days from the date of the ruling
  4. 4.Failure to observe orders (b) and (c) shall entitle the respondent to execute the judgment and decree unless the duration is extended by the court
  5. 5.Costs shall be in the appeal

Authorities

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Legislation

  • Civil Procedure ActSections 79G, 95, 63(e), 1A, 1B, 3A
  • Civil Procedure Rules, 2010Order 42 rule 6; Order 51 rule 1
  • Evidence ActSection 112
  • Constitution of KenyaArticles 159(2)(d), 48

Cases cited (7)

  • James Wangalwa & another v Agnes Naliaka Cheseto
    Misc. App No 42 of 2011
  • Mwaura Karuga t/a Limit Enterprises v Kenya Bus Services Ltd & 4 others
    (2015) eKLR
  • RWW v EKW
    (2019) eKLR
  • Michael Ntouthi v Abraham Kivondo
    (2021) eKLR
  • Vishram Ravji Halai v Thornton & Turpin
    (1990) KLR
  • National Industrial Credit Ltd v Francis Wasike & another
    (2006) eKLR
  • Victor Ogola v Mary Waithe Kihiu
    (2021) eKLR
On appeal from
Principal Magistrate's Court, Mavoko
Mavoko MCEL No. 98 of 2019 (John Ngotho Mburu v Endmor Steel Millers Ltd)
Jurisdiction invoked
Sections 79G, 95, 63(e), 1A, 1B and 3A of the Civil Procedure Act; Order 42 rule 6 and Order 51 rule 1 of the Civil Procedure Rules, 2010

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, "Endmor Steel Millers Ltd v Mburu (Appeal E14 of 2022) [2023] KEELRC 635 (KLR)", Case Analysis (2023). Notice of motion dated September 8, 2022 (arising from Mavoko MCEL No. 98 of 2019). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/635/eng@2023-03-16

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