Sana Industries Limited v Macharia (Employment and Labour Relations Appeal E105 of 2025) [2025] KEELRC 2035 (KLR)
The bottom line
#Kenya's Employment Court paused execution of a Kshs 421,502 judgment because the judgment creditor could not show they could refund the money if the appeal succeeded.
What this practically means
#Executive summary
#Key legal issues
#Conditions for grant of stay of execution pending appeal
The three conditions under Order 42 Rule 6(2) - substantial loss, no unreasonable delay, and security - were all satisfied.
The court applied Order 42 Rule 6(2) of the Civil Procedure Rules to fill the lacuna in the ELRC (Procedure) Rules 2024. The application filed on 15th April 2025 followed a judgment of 18th March 2025, so there was no unreasonable delay. Substantial loss was demonstrated because the respondent, having filed only grounds of opposition and no affidavit, did not demonstrate ability to refund the decretal sum. Security in the form of a logbook of a vehicle registered in the applicant's name, supported by a valuation report, was held sufficient.
Meaning of substantial loss in money decrees
Substantial loss is a qualitative concept; in money decrees it lies in the respondent's inability to refund the decretal sum if the appeal succeeds.
Relying on Antoine Ndiaye v African Virtual University, the court held that substantial loss is not a mathematical formula but any loss of real worth. The applicant showed it would be reduced to a mere explorer in the judicial process if it paid the decretal sum without prospects of recovery. Since the respondent did not demonstrate ability to refund, potential substantial loss to the applicant was established.
Sufficiency of the security offered
The logbook of Motor Vehicle KCB 015G, valued at Kshs. 1,300,000 against a decretal sum of Kshs. 421,502 plus interest and half costs, was good security.
The applicant produced a valuation report and a copy of the logbook showing the vehicle registered in its name, unencumbered by loans and with no previous owners. The respondent's objection that the security was offered by an employee and was not good did not persuade the court, which was satisfied on ownership and sufficiency.
Legal principles established
#- In a money decree, substantial loss lies in the inability of the Respondent to refund the decretal sum should the appeal succeed.
- A stay ought to be granted so that an appeal, if successful, may not be nugatory.
Court orders
#- 1.Temporary order of stay of execution of the Judgment and Decree of the Magistrates Court delivered on 18th March 2025 by Hon Diana Orago pending the hearing and determination of the Appeal
- 2.The original logbook of Motor Vehicle Registration number KCB 015G valued at Kshs. 1,300,000/- admitted as security to be deposited in court within 15 days of the order, in default execution may proceed
- 3.Costs of the application to the Respondent in the cause
- 4.Mention on 14th July 2025 for further directions in the appeal
- On appeal from
- Magistrates Court at Ruiru
- MCELRC/E024/2024
- Jurisdiction invoked
- Order 40 Rule 6, Order 50 Rules 3 and 6, Sections 1A and 3A of the Civil Procedure Act Cap 21, and Rule 21 of the Employment and Labour Relations Court (Procedure) Rules 2024
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Sana Industries Limited v Macharia (Employment and Labour Relations Appeal E105 of 2025) [2025] KEELRC 2035 (KLR)", Case Analysis (2025). Notice of Motion dated 11th April 2025 (Appeal from Ruiru MCELRC/E024/2024). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/2035/eng@2025-07-04
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.