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ELRCDismissedELRC at Machakos – Notice of Motion dated 3rd March 2025 (following judgment dated 31st January 2025)· [2025] KEELRC 1842 (KLR)

Scott Bowerbank Day v Victory Farms Limited (Employment and Labour Relations Cause E181 of 2022) [2025] KEELRC 1842 (KLR)

Employment and Labour Relations Court
20 June 2025
3,444 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
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The bottom line

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A Kenyan employment court refused to pause a USD 238,352 judgment because the losing company never offered security to guarantee payment if its appeal failed.

What this practically means

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Executive summary

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The applicant (the party against whom judgment was entered on 31 January 2025, awarding the claimant USD 238,352 comprising 10 months' salary, a management incentive payment and a relocation allowance, with interest and costs) moved this Court by Notice of Motion dated 3 March 2025 under Rule 73(2) of the ELRC (Procedure) Rules, 2024 and Order 42 Rule 6 of the Civil Procedure Rules, seeking stay of execution and of further proceedings pending an intended appeal to the Court of Appeal. It relied on a Notice of Appeal dated 10 February 2025 and a draft memorandum raising grounds on the management incentive, redundancy, severance pay and compensation. The claimant opposed, contending the applicant had offered no security, was a foreign-owned company capable of folding up, and that the claimant was capable of refunding the decretal sum. In a further affidavit the applicant denied being a foreign entity and asserted the claimant had no known Kenyan address or assets. The court held that the Order 42 Rule 6(2) conditions are mandatory. On substantial loss, applying Century Oil Trading and National Industrial Credit Bank v Wasike, the burden shifted to the claimant, who had not shown ability to refund; that condition was met. However, the applicant offered no security, a compulsory condition; relying on Michael Ntouthi Mitheu v Kivondo Musau and authorities pressed by the respondent, the court found the application a decoy to delay the claimant's enjoyment of the judgment. The court also held that arguability of the appeal is for the Court of Appeal, not the trial court. The application was dismissed with costs to the respondent on 20 June 2025.

Key legal issues

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01

Substantial loss

Holding

The applicant satisfied the substantial-loss condition because the decree holder had not demonstrated ability to refund the money decree if the appeal succeeds.

Reasoning

The decree was a money decree of USD 238,352. Relying on Century Oil Trading and National Industrial Credit Bank v Wasike, the court held that the financial position of both parties is relevant, and that once an applicant reasonably fears non-refundability, the burden shifts to the decree holder to show his resources. The claimant, a resident of Zambia and US citizen with no known Kenyan assets, had not shown ability to repay, so substantial loss was demonstrated.

p. 6
02

Security for due performance of the decree

Holding

The application failed because the applicant offered no security, a compulsory condition for stay.

Reasoning

Order 42 Rule 6(2)(b) is mandatory. The applicant relied on status quo instead of offering security, despite having had ample opportunity since a temporary stay issued after the 31 January 2025 judgment. The court adopted the reasoning in Michael Ntouthi Mitheu v Kivondo Musau on why security is required, and the authorities relied on by the respondent holding the security condition to be mandatory. Absent security, the application was a decoy to delay the claimant's enjoyment of the judgment.

p. 7
03

Arguability of the intended appeal

Holding

The trial court could not consider arguability; that is the preserve of the Court of Appeal.

Reasoning

Although the applicant advanced extensive draft grounds of appeal attacking the findings on the management incentive, redundancy, relocation allowance, severance pay and compensation for unfair termination, the court held that as the trial court it could only consider the factors in Order 42 Rule 6(2); questions of arguability belong to the appellate court on similar applications.

p. 7

Legal principles established

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  • The conditions for stay of execution under Order 42 Rule 6(2) of the Civil Procedure Rules – substantial loss, no unreasonable delay and security for due performance of the decree – are mandatory.
  • A trial court entertaining a stay application cannot determine the arguability of the intended appeal; that question is for the Court of Appeal.
  • Where an applicant for stay of a money decree expresses a reasonable fear that the decree holder cannot refund, the evidential burden shifts to the decree holder to show his resources.

Court orders

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  1. 1.The application dated 3rd March 2025 is dismissed
  2. 2.Costs of the application to the respondent
  3. 3.It is so Ordered

Authorities

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Legislation

  • Employment and Labour Relations Court (Procedure) Rules, 2024Rule 73(2)
  • Civil Procedure RulesOrder 42 Rule 6(1) and (2)(a) and (b)
  • Evidence Act, Chapter 80 Laws of KenyaSection 112
  • Employment ActSection 2 (definition of redundancy), Section 40 (severance pay)

Cases cited (7)

  • Century Oil Trading Company Ltd v Kenya Shell Limited
    Nairobi (Milimani) HCMCA No. 1561 of 2007
  • National Industrial Credit Bank Ltd v Aquinas Francis Wasike & another
    [2006] eKLR
  • Michael Ntouthi Mitheu vs Kivondo Musau
    [2021] eKLR
  • Nduhiu Gitahi v Warugongo
    [1988] KLR 621; 1 KAR 100; [1988-92] 2 KAR 100
  • Gianfranco Manenthi & another v Africa Merchant Assurance Company Ltd
    (2019) eKLR
  • Nganga Kabae v Kahunyo Kimani
    1999 eKLR
  • Wycliffe Sikuku Walusaka v Philip Kaita Wekesa
    2020 eKLR
Jurisdiction invoked
Rule 73(2) of the Employment and Labour Relations Court (Procedure) Rules, 2024 read with Order 42 Rule 6 of the Civil Procedure Rules

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, "Scott Bowerbank Day v Victory Farms Limited (Employment and Labour Relations Cause E181 of 2022) [2025] KEELRC 1842 (KLR)", Case Analysis (2025). ELRC at Machakos – Notice of Motion dated 3rd March 2025 (following judgment dated 31st January 2025). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/1842/eng@2025-06-20

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