J.M. Njenga & Co. Advocates LLP v Kimuri Housing Company Ltd

c) THAT there be a stay of execution of the Decree dated 16/02/ 2026. d) THAT this Honorable Court be pleased to allow the Judgment debtor/Applicant to settle the outstanding balance of the decretal sum by way of monthly instalments of Kshs 300,000 payable on or before the 15th day of every Month. e) THAT this Honorable Court do grant leave to the firm of Thiongo & Partners Advocates to come on record for the Judgment debtor/Applicant post Judgment/Ruling. f) THAT this Honorable Court be pleased to issue any other order as it deems fit and just in the circumstances. 2. The Application is supported by the Affidavit of MARGRET WAMBUI NGUGI sworn on even date. The grounds are that the Judgment Debtor/Applicant was ordered by a Decree dated 16/02/2026, to pay Kshs 9,584,270 to the Decree Holder/Respondent, but is currently unable to satisfy this entire amount in a single lump sum due to competing financial obligations. To clear the debt within two years, the Applicant has proposed paying monthly instalments of Kshs 300,000 -due on or before the 15th of each monthsupplemented by additional payments whenever extra funds become available. However, because the Decree Holder has already issued warrants of attachment and proclaimed the ELCLMISC. NO. E007 OF 2024 2|Page

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Applicant's assets and tools of trade for seizure on 3rd March, 2026, the Applicant urgently requests an interim stay of execution alongside approval for the proposed payment plan, warning that without Court intervention, the loss of these vital operational assets will cause irreparable harm and ruin its ability to generate the income needed to meet this payment plan and other obligations. 3. In the Supporting Affidavit, deponent Margret Wambui Ngugi states that she is a Director of the Judgment Debtor/Applicant, making her competent to swear to the facts of the case. She explains that the Applicant was ordered to pay the Decree Holder/Respondent Kshs 9,584,270 pursuant to a Court Decree dated 16/02/2026. Owing to multiple existing financial obligations, the Applicant cannot settle the sum in a lump sum and has proposed a two-year payment plan of Kshs 300,000 per month due on or before the 15th of each month, supplemented by lump payments whenever additional funds become available. 4. However, the Decree Holder has already obtained warrants of attachment and proclaimed the Applicant’s assets and tools of trade on 16/02/2026, evidence of which is attached as Annexure "MWN-1" comprising a copy of the warrants of attachment and the proclamation notice. The deponent emphasizes that if the Court does not urgently intervene with an interim stay of execution ahead of the scheduled carting away of property on 3/03/2026, the Applicant will ELCLMISC. NO. E007 OF 2024 3|Page

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suffer irreparable harm, as the loss of its operational tools will cripple business operations and render it impossible to honor the proposed instalment payments or meet its other financial commitments. 5. In opposition to the Application the Decree Holder/Respondent filed a Replying Affidavit sworn on 10/03/2026. In the Replying Affidavit, deponent Jeremy Njenga, an Advocate of the High Court of Kenya and Managing Partner of the Decree-holder/Respondent law firm, states that he is fully conversant with the facts and competent to swear the Affidavit in opposition to Margaret Ngugi’s application dated 3/03/2026. He contends that having previously acted for the Judgment Debtor Company, he knows it holds real estate assets valued in billions of Kenya Shillings and collects substantial rent from commercial and residential developments; thus, its claim of being unable to pay the decretal sum of Kshs 9,584,270.10 in a lump sum is unproven, as it provided no evidence of its alleged multiple financial obligations. He argues that if genuinely committed to settling, the Company could have offered land or property to offset the debt rather than presenting an unconscionable offer of Kshs 300,000 per month without making any initial down payment, which would delay full recovery for over three years and frustrate the Decreeholder's right to enjoy the fruits of its Judgment. ELCLMISC. NO. E007 OF 2024 4|Page

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6. Accordingly, the Decree-holder opposes the application and proposes a counter-offer requiring an immediate down payment of at least 30% of the decretal sum, with the remaining balance settled in monthly instalments of at least Kshs 500,000. Finally, the deponent requests that the Court either dismiss the Judgment Debtor’s application with costs due to its total lack of effort to settle any portion of the debt since Judgment was entered, or grant the application strictly on the terms of the Decree-holder’s counter-offer. 7. In the Further Affidavit sworn on 21/07/2026, deponent Margaret Wambui Ngugi, a Director of the Judgment Debtor Company, responds to Jeremy Njenga’s Replying Affidavit to clarify the Company's financial state and reinforce its Notice of Motion. She maintains that the Judgment Debtor has never refused to satisfy the decretal sum but is severely constrained by operational cash-flow bottlenecks. She contends that the Decree-Holder's demand for an upfront lump-sum payment of Kshs 3,500,000 alongside monthly payments of Kshs 500,000 is commercially unviable, oppressive, and mathematically impossible for the Company to fulfill under its current financial standing. 8. To demonstrate these financial constraints, the deponent reveals that the Judgment Debtor is already actively servicing another decretal debt in Milimani ELC Misc. Case No. E065 & E067 of 2024 (Peter Gachuhi & Company Advocates v. Kimuri Housing Limited & Another) at a ELCLMISC. NO. E007 OF 2024 5|Page

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fixed rate of Kshs 500,000 per month, as evidenced by Annexure "MWN-1" which is a copy of the consent order in that matter. She warns that executing the attachment and sale of the Company's primary office equipment and tools of trade will destroy its revenue source, causing business operations to cease and making it impossible to pay either creditor. Consequently, she asserts that the proposed instalment of Kshs 300,000 per month is the absolute maximum sustainable amount the Company can offer without defaulting into total insolvency, noting that the Decree-Holder will suffer no prejudice since statutory interest continues to accrue on the outstanding balance. She concludes by urging the Court to exercise its equitable discretion under Order 21 Rule 12 of the Civil Procedure Rules to allow the Notice of Motion as prayed. 9. The parties canvassed the Application by way of written submissions. In its written submissions, the Judgment Debtor, Kimuri Housing Company Limited, invokes Order 21 Rule 12 of the Civil Procedure Rules, 2010, contending that the Court possesses unfettered judicial discretion to order payment of instalments. the Kshs. 9,584,270/= Citing the precedent decretal case of sum in Keshavji Jethabhai & Bros Ltd v. Saleh Abdullah (1959) EA 260, Counsel submits that financial hardship of the debtor is a critical factor and that justice demands granting an indulgence where it does not unreasonably prejudice the ELCLMISC. NO. E007 OF 2024 6|Page

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creditor. Counsel highlights that the Applicant faces severe operational cash-flow bottlenecks while servicing another major decretal debt of Kshs. 500,000/= per month in Milimani ELC Misc. Case No. E065 & E067 of 2024 (Peter Gachuhi & Company Advocates v. Kimuri Housing Limited & Another). Consequently, forcing an immediate lump-sum payment or the Decree-Holder’s proposed Kshs. 3.5 million down payment would cripple the Applicant's commercial enterprise and lead to total insolvency. 10. Relying further on Hildegard Ndalut v. Lelkina Dairies Ltd & Anor (2005) eKLR, Counsel argues that the Applicant has demonstrated utmost bona fides and a genuine commitment to settle the debt through its proposed monthly instalments of Kshs. 300,000/=. Counsel stresses that execution is meant to enable a Decree holder to realize the fruits of Judgment, not to drive a Judgment Debtor into liquidation. If the Decree-Holder is permitted to carry away the proclaimed office equipment and tools of trade, the Applicant's revenue stream will cease entirely, rendering it impossible to satisfy any creditor. Therefore, the balance of convenience favors granting a stay of execution and approving the instalment plan, especially since statutory interest continues to accrue to safeguard the Decree-Holder against any prejudice. ELCLMISC. NO. E007 OF 2024 7|Page

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11. In its written Decree-Holder/Respondent law submissions, firm contends the that the Judgment Debtor's application dated 3/03/2026 seeking a stay of execution and permission to pay the decretal sum now approaching Kshs 10,000,000 including interest in monthly instalments of Kshs 300,000 is a bad-faith maneuver designed solely to delay execution after its assets were proclaimed on 26/02/2026. The Decree-Holder emphasizes that the underlying debt stems from taxed professional legal fees that are the backbone of a law firm's operations. On the issue of stay of execution under Order 42, Counsel submits that the Applicant has failed to demonstrate substantial loss through concrete evidence, filed the application tardily only after proclamation, and offered no security, making the application unmeritorious. 12. Regarding payment by instalments under Order 21 Rule 12, Counsel relies on Keshavji Jethabhai & Bros Ltd v. Saleh Abdullah (1959) EA 260, A. Rajabali Alidina v. Remtulla Alidina & Ano (1961) EA 565, and Hildegard Ndalut v. Lelkina Dairies Ltd & Anor (2005) eKLR to argue that the burden lies squarely on the debtor to establish bona fides and show sufficient cause for Court indulgence. Citing Keshavji Jethabhai and Hildegard Ndalut, Counsel stresses that mere inability to pay or generalized financial hardship does not automatically warrant an order for instalments; a debtor must demonstrate ELCLMISC. NO. E007 OF 2024 8|Page

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genuine seriousness by making a prompt payment of a fair proportion of the debt. The Decree-Holder notes that the Applicant has paid nothing since Judgment was entered on 4/02/2026, nor has it provided bank statements or financial records to substantiate its alleged cash-flow difficulties or rebut assertions that it is a multi-billion-shilling enterprise. 13. Counsel submits that allowing instalments of Kshs 300,000 per month would unfairly prejudice the DecreeHolder by extending liquidation over 33 months excluding interest, denying it the timely enjoyment of the fruits of its Judgment. Consequently, the Decree-Holder urges the Court to dismiss the application with costs. Alternatively, if the Court is inclined to grant relief, Counsel prays that it adopts the Decree-Holder’s counter-offer being an immediate down payment of at least Kshs 3,500,000, followed by monthly instalments of Kshs 500,000 accompanied by a strict default clause. Issues for Determination 14. Having evaluated the pleadings, Affidavits, and written submissions filed by the parties, the key issues arising for determination are: i. Whether the Judgment Debtor has established sufficient cause to warrant the grant of an order for stay of execution, and ii. Whether the Court should exercise its judicial discretion under Order 21 Rule 12 of the Civil ELCLMISC. NO. E007 OF 2024 9|Page

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Procedure Rules to permit the liquidation of the decretal sum by monthly instalments. 15. The principles governing the grant of a stay pending execution or further proceedings are anchored under Order 42 Rule 6 of the Civil Procedure Rules 2010, alongside the Court’s inherent powers to prevent abuse of process under Sections 1A, 1B, and 3A of the Civil Procedure Act. The Applicant must demonstrate that substantial loss will result unless the order is granted, that the application was made without unreasonable delay, and that adequate security is provided. The Applicant argues that carting away its primary office equipment on 3/03/2026 will cause irreparable harm by shutting down its business operations completely. However, as noted by the Decree-Holder, execution of a lawful Decree does not automatically equate to substantial loss unless supported by clear evidence of exceptional prejudice, and the Applicant moved the Court only after execution was levied. 16. While the Judgment Debtor filed its application after proclamation had already taken place, Kenyan Courts recognize that judicial discretion must remain equitable when evaluating whether execution threatens the very existence of an operational enterprise. In BM Mung'ata & Company Advocates v Kamia (Civil Miscellaneous Application E089 of 2021) [2026] KEHC 5826 (KLR), the High Court examined the dual statutory standards governing ELCLMISC. NO. E007 OF 2024 10 | P a g e

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post-Judgment relief and underscored that Court intervention must balance the preservation of a viable business against the imperative of enforcing judicial Decrees. Although the Judgment Debtor approached the Court post-proclamation, the immediate threat to its tools of trade presents a genuine risk of operational collapse, satisfying the substantial loss test provided an equitable payment structure can be implemented. 17. On the second issue of permitting payment by instalments, the Court’s authority derives directly from Order 21 Rule 12(2) of the Civil Procedure Rules 2010, which allows the Court for sufficient cause shown to order that the payment of a decretal sum be made by instalments, even without the consent of the Decree-holder. The law does not mandate absolute refusal of relief merely because a Decreeholder rejects a proposed payment structure. In Mwangi v Happy Go Ltd (Cause 229 of 2018) [2022] KEELRC 13321 (KLR), the Employment and Labour Relations Court observed that the core inquiry under Order 21 Rule 12 is whether the Applicant has established sufficient cause and demonstrated bona fides through genuine, sustainable proposals to satisfy the Judgment debt rather than executing an indefinite delay 18. As held by the High Court in Awuonda v Kenya Commercial Bank Limited (Civil Appeal 9 of 2018) [2023] KEHC 3136 (KLR), the exercise of judicial discretion ELCLMISC. NO. E007 OF 2024 11 | P a g e

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under Order 21 Rule 12 requires a delicate balancing act. The Court noted that while a Decree-holder is entitled to enjoy the fruits of a Judgment without unreasonable hindrance, the judicial process should avoid driving a willing debtor into absolute insolvency where structured relief can yield full recovery over time. 19. In the present case, despite the Decree-Holder's rejection of the initial proposal and the Judgment Debtor's delayed entry into Court, the Judgment Debtor has demonstrated good faith by coming forward with an active offer to begin settling the debt while maintaining its existing monthly Court-ordered obligations under Milimani ELC Misc. Case No. E065 & E067 of 2024. Rejecting the debtor's offer outright would result in the immediate attachment and auction of primary tools of trade, destroying its revenue-generating capacity and leaving both creditors unpaid. Consequently, establishing sufficient cause under Order 21 Rule 12 permits the Court to grant an indulgence that protects the business as a going concern, while modifying the payment schedule such as introducing an immediate initial down payment and an upgraded monthly sum to safeguard the Decree-Holder against unreasonable prejudice. 20.I do not however, that the Applicant has failed to produce audited accounts or bank statements to establish its overall financial position or to demonstrate why no down payment ELCLMISC. NO. E007 OF 2024 12 | P a g e

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has been offered out of the principal sum of over Kshs 9.5 million. While Order 21 Rule 12 allows room for judicial indulgence to prevent total commercial insolvency, an instalment scheme of Kshs 300,000/= per month stretching over nearly three years without an initial lump sum unreasonably prejudices the Decree-Holder law firm, which is entitled to prompt settlement of its taxed fees. Consequently, any order allowing payment by instalments must incorporate a substantial upfront payment and a enhanced monthly rate to balance the equities between the parties. 21. Given the foregoing I do make the following orders: 1) The Judgment Debtor/Applicant's Notice of Motion dated 3/03/2026 is hereby allowed with modifications as set out below. i. An order of stay of execution of the Decree dated 16/02/2026 and any warrants or proclamation issued pursuant thereto is hereby granted, liquidation of the pending decretal the full sum in accordance with the structured payment plan ordered herein. ii. The Judgment Debtor/Applicant is granted leave to settle the outstanding decretal sum of Kshs 9,584,270/= together with accrued interest on the following terms: ELCLMISC. NO. E007 OF 2024 13 | P a g e

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a) An initial down payment of Kshs 1,500,000/= to be paid to the DecreeHolder/Respondent within fourteen (14) days from the date of this Ruling. b) The remaining balance to be liquidated by way of monthly instalments of Kshs 400,000/= payable on or before the 15 th day of every commencing on succeeding 15/10/2026, month, until full payment. 2) In default of payment of the initial down payment or any single monthly instalment on its due date, the order of stay of execution shall automatically lapse, and the DecreeHolder/Respondent shall be at liberty to execute for the entire outstanding balance without further reference to this Court. 3) Leave is hereby granted to the firm of Thiongo & Partners Advocates to come on record for the Judgment Debtor/Applicant post-Judgment. 4) Each party shall bear its own costs of this application. 22.Orders Accordingly. DATED, SIGNED AND DELIVERED AT THIKA VIA MICROSOFT TEAMS ON THIS 21ST DAY OF SEPTEMEBR 2026. ELCLMISC. NO. E007 OF 2024 14 | P a g e

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.................................. MOGENI J JUDGE In the presence of: Mr. Kariuki for Judgment Debtor/Applicant Decree Holder/Respondent - Absent Mr. Melita - Court Assistant ............................. MOGENI J JUDGE ELCLMISC. NO. E007 OF 2024 15 | P a g e

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