County Government of Kajiado v Tata Chemicals Magadi Limited

b) SPENT. c) THAT pending the hearing and determination of the appeal in Nairobi Court of Appeal Civil Appeal No. E1106 of 2025, this Honourable Court be pleased to order a stay of further proceedings of Assessment/Taxation of the Defendant/Respondent's Party and Party Bill of Costs for the sum of Kenya Shillings One Hundred Fifty Four Million Four Hundred Ninety Five Thousand Three Hundred Seventy Two, Ninety one (Kshs 154,495,372.91) dated 19/01/2026. d) THAT the costs of this Application be in the cause. 3. The application is supported by the affidavit of Vera Moraa, the Director General of Revenue for the Plaintiff/Applicant, the County Government of Kajiado, sworn on 19th March 2026. It is premised on the grounds that this Court struck out the Plaintiff's Plaint on 6th November 2025 for alleged want of jurisdiction without hearing the dispute on its merits. Being dissatisfied with the said decision, the Plaintiff lodged a Notice of Appeal on 13th November 2025 and subsequently filed and served the Record of Appeal in Nairobi Civil Appeal No. E1106 of 2025. 4. The Applicant laments that despite the pending appeal, the Defendant served a Party and Party Bill of Costs dated 19th January 2026 for a colossal __________________________________________________________________ RULING ELC LC E089/25 2

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sum of Kenya Shillings One Hundred Fifty Four Million Four Hundred Ninety Five Thousand Three Hundred Seventy Two, Ninety one (Kshs. 154,495,372.91), which has been scheduled for taxation before the Taxing Master. The Applicant contends that it has an arguable appeal with a high probability of success centered on the unlimited original jurisdiction of the Environment and Land Court under Section 13 of the ELC Act, the pecuniary jurisdiction of subordinate courts, and the proper constitutional interpretation of Section 5 of the repealed Rating Act. Furthermore, the Applicant highlights exceptional circumstances, asserting that the Defendant owes outstanding land rates totaling Kenya Shillings Ten Billion Two Hundred and Eighty-Four Million, Eighty-Four Thousand, One Hundred and Ninety-Four (Kshs. 10,284,084,194/=), and that the suit was allegedly not defended in the manner prescribed under Order 7 Rule 5 of the Civil Procedure Rules. 5. In opposition to the application, the Defendant/Respondent filed its grounds of opposition on 13th April 2026 alongside a Replying Affidavit sworn on 21st April 2026 by Jessica Detho, an Advocate practicing with Oraro & Company Advocates. The Defendant contends that the Plaintiff's Notice of Motion; brought principally under Order 42 Rule 6(2) of the Civil __________________________________________________________________ RULING ELC LC E089/25 3

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Procedure Rules, 2010, is fundamentally premature, as the Party and Party Bill of Costs dated 19th January 2026 is yet to be taxed by the taxing master. 6. The Defendant maintains that the Plaintiff has failed to demonstrate any quantifiable substantial loss or show how it would provide security for the due performance of the decree, given that the precise liability remains unascertained prior to taxation. Furthermore, the Respondent asserts that the application has been instituted in bad faith solely to obstruct and delay the Defendant from enjoying the fruits of litigation. 7. On the merits of the dispute, the Defendant deposes that the issues raised by the Plaintiff are neither novel nor arguable, as they merely seek to rehash settled arguments regarding the Environment and Land Court's unlimited original jurisdiction and the pecuniary jurisdiction of the Magistrates' Court; matters already governed by Section 25 of the repealed Rating Act. 8. Crucially, the Defendant draws attention to the binding Court of Appeal judgment delivered on 24th October 2025 in Civil Appeal No. 530 of 2019 (Tata Chemicals Magadi Limited v. County Government of Kajiado ), which conclusively determined that the company was not obliged to pay a similar historical demand of Kshs. 17,448,485,646/= and held that the Kajiado __________________________________________________________________ RULING ELC LC E089/25 4

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County Finance Bills for 2013/2014, 2015/2016, 2016/2017, and 2017/2018 were enacted contrary to Articles 201, 209(3), and 209(5) of the Constitution, rendering them null and void. The Defendant notes that while the County Government has moved the Supreme Court seeking an enlargement of time to appeal that decision, no ruling or judgment currently exists to overturn the appellate court's findings. Consequently, the Defendant urges the Court to dismiss the application with costs for failing to satisfy the stringent legal threshold required for a stay of proceedings. Directions 9. The application was canvassed by way of written submissions, the submissions of which have been duly considered in the writing of this ruling. Issues for determination 10. Having considered the Notice of Motion dated 19th March 2026, the supporting affidavit, the grounds of opposition and the Replying Affidavit, together with the respective submissions, the single issue for determination is whether the Plaintiff/Applicant has satisfied the legal threshold for an order staying further proceedings in respect of the taxation of the Defendant/Respondent’s Party and Party Bill of Costs pending the hearing and determination of Nairobi Civil Appeal No. E1106 of 2025. __________________________________________________________________ RULING ELC LC E089/25 5

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Analysis and Determination 11. The starting point is that the filing of an appeal does not, of itself, operate as a stay. The jurisdiction of the Court to grant a stay pending appeal is principally founded on Order 42 Rule 6 of the Civil Procedure Rules. Order 42 Rule 6(1) provides: “No appeal or second appeal shall operate as a stay of execution or proceedings under a decree or order appealed from except in so far as the court appealed from may order…” 12. Order 42 Rule 6(2) further provides: “No order for stay of execution shall be made under subrule (1) unless—(a) the court is satisfied that substantial loss may result to the applicant unless the order is made and that the application has been made without unreasonable delay; and (b) such security as the court orders for the due performance of such decree or order as may ultimately be binding on him has been given by the applicant.” __________________________________________________________________ RULING ELC LC E089/25 6

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13.The present application, however, requires some distinction. The Applicant is not seeking a stay of execution of a quantified monetary decree. Rather, it seeks to stop the taxation proceedings in respect of a Party and Party Bill of Costs arising from the dismissal of its suit. The Respondent consequently argues that the application is premature because the Bill has not yet been taxed and the amount payable has therefore not been ascertained. 14.That argument, in my view, does not by itself dispose of the application. Taxation of party and party costs is a process connected with the enforcement and ascertainment of the costs awarded by the Court. 15.The High Court in Musyoka Kimeu & Co. Advocates v Makata Savings & Credit Co-operative Society Ltd [2019] KEHC 3974 (KLR) recognized that taxation forms part of the execution process and held that Order 42 Rule 6 may apply where a party seeks to stay taxation. The Court stated that: “Taxation of costs is part of the execution process, complete with its provisions for stay of execution.” 16.The fact that taxation has not yet occurred therefore does not deprive this Court of jurisdiction to consider an application seeking to halt the process. Indeed, in Dickson Sinkeet Mapi v Naisenyu Pargarna Mutunkei [2021] __________________________________________________________________ RULING ELC LC E089/25 7

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KEELC 1807 (KLR), the Court considered an application seeking to stop taxation pending appeal and applied the requirements under Order 42 Rule 6. 17.The question, therefore, is whether the Applicant has demonstrated sufficient grounds for the exercise of that discretion. 18.There is also an important distinction between a stay of execution and a stay of proceedings. The latter is a more drastic remedy because it interferes with the ordinary progress of proceedings. In Kenya Wildlife Service v James Mutembei [2019] eKLR, as subsequently applied by the superior courts, it was observed that: “Stay of proceedings is a grave judicial action which seriously interferes with the right of a litigant to conduct his litigation.” 19.The principles applicable to stay of proceedings pending appeal were comprehensively restated in William Odhiambo Ramogi & 3 Others v Attorney General & 6 Others; Muslims for Human Rights & 2 Others (Interested Parties) [2020] KEHC 10097 (KLR) . The Court identified, inter alia, the need for a pending appeal, an arguable appeal, demonstration that __________________________________________________________________ RULING ELC LC E089/25 8

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the appeal would be rendered nugatory absent a stay, exceptional circumstances warranting a stay, and an application brought expeditiously. 20. Similarly, in Re Global Tours & Travels Limited, Nairobi HC Winding Up Cause No. 43 of 2000, Ringera J. (as he then was) stated, in the oftcited passage, that the Court should consider: “the prima facie merits of the intended appeal … whether it is an arguable one” and balances those considerations against the need for expeditious disposal of cases and the optimum utilization of judicial time. 21.The Court therefore approaches the present application on the basis that the Applicant must demonstrate more than the mere existence of an appeal. It must establish circumstances justifying the interruption of the taxation process. 22. There is no dispute that the Applicant lodged a Notice of Appeal against this Court's decision of 6th November 2025 and that an appeal is pending before the Court of Appeal. The existence of the appeal is therefore not in question. 23. The Applicant contends that its appeal raises substantial questions concerning, principally, the jurisdiction of this Court under Section 13 of the Environment and Land Court Act, the jurisdiction of subordinate courts, and __________________________________________________________________ RULING ELC LC E089/25 9

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the interpretation of the repealed Rating Act. Those questions are matters properly reserved for the appellate Court. This Court should not, at this interlocutory stage, determine the merits of the pending appeal or sit on appeal over its own decision. 24. For present purposes, I am prepared to accept that the Applicant has demonstrated an arguable appeal. An arguable appeal, however, does not automatically entitle an applicant to a stay of proceedings. The Applicant must further demonstrate that unless the taxation is stayed, the appeal will be rendered nugatory or that the Applicant will suffer substantial prejudice which cannot adequately be addressed in the ordinary course. 25. That is where the application falls short. 26. The Applicant principally relies upon the fact that the Bill of Costs is for Kshs.154,495,372.91 and that the Defendant allegedly owes the County Government approximately Kshs.10.284 billion in land rates. With respect, neither circumstance establishes substantial loss arising from the continuation of taxation. 27. First, the Bill has not yet been taxed. The figure of Kshs.154,495,372.91 is therefore only the amount claimed in the Bill and not an amount judicially ascertained as due from the Applicant. The Applicant has not demonstrated __________________________________________________________________ RULING ELC LC E089/25 10

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that taxation itself will occasion an irreversible prejudice. It remains open to the Applicant to participate in the taxation and challenge any adverse decision in accordance with the law. 28. Secondly, the allegation that the Respondent owes the Applicant billions of shillings in land rates does not constitute a legal answer to the costs proceedings. The alleged indebtedness of the Respondent, even if established, does not extinguish or suspend a costs award made in favour of the Respondent. Any competing monetary claims between the parties must be dealt with through the appropriate legal processes and cannot, without more, constitute security or substantial loss for purposes of Order 42 Rule 6. 29. Thirdly, the Applicant has not demonstrated that, if taxation proceeds and the appeal subsequently succeeds, the consequences cannot be reversed or otherwise remedied. This is particularly significant because the present application seeks to stop taxation, rather than the immediate payment of a taxed sum. The Court must therefore be satisfied that the mere continuation of the taxation process would occasion prejudice of such a nature that the pending appeal would be rendered nugatory. No such prejudice has been demonstrated. __________________________________________________________________ RULING ELC LC E089/25 11

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30. The position is well illustrated in Dickson Sinkeet Mapi v Naisenyu Pargarna Mutunkei [2021] KEELC 1807 (KLR), where the Court declined to stay taxation where the applicant had not demonstrated the prejudice that would result from the taxation and had not offered security. 31. There is a further difficulty. Order 42 Rule 6(2)(b) expressly requires an applicant seeking stay to provide such security as the Court may order for the due performance of the decree or order ultimately binding upon it. 32. The Applicant has neither proposed nor offered any security. This omission assumes significance because the application seeks to restrain the Respondent from pursuing its costs through taxation while the Applicant's appeal remains pending. The Respondent, having obtained an order for costs following the dismissal of the suit, is entitled to pursue the lawful process for ascertainment of those costs. 33. The Court must therefore balance the Applicant's right to pursue its appeal against the Respondent's corresponding right not to have the fruits of its successful litigation unnecessarily delayed. 34. The Court of Appeal in Vishram Ravji Halai v Thornton & Turpin [1990] KLR 365 recognized that the jurisdiction of the High Court under Order 42 __________________________________________________________________ RULING ELC LC E089/25 12

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Rule 6 is circumscribed by the statutory requirements relating to sufficient cause, substantial loss and security. 35. The same principle continues to guide applications for stay of proceedings. See also Africert Limited v Nyaga [2025] KEHC 11684 (KLR) . 36. In the circumstances of this case, the failure to offer security weighs against the Applicant. 37. The Applicant's position appears, in substance, to be that because the decision striking out its suit is under challenge, the consequential taxation should await the outcome of the appeal. 38. That proposition cannot be accepted as an automatic rule. Order 42 Rule 6(1) expressly provides that an appeal does not operate as a stay. A successful litigant is not required to forgo the benefits of a judgment merely because the unsuccessful party has exercised its right of appeal. 39. The Court must also bear in mind that taxation is itself a structured judicial process. The Applicant will have an opportunity to raise its objections before the Taxing Officer. The mere fact that the amount claimed is substantial does not, without evidence of actual prejudice, justify stopping that process altogether. __________________________________________________________________ RULING ELC LC E089/25 13

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40. Indeed, the Respondent's Bill of Costs cannot properly be described as a final liability of Kshs. 154,495,372.91 until taxation takes place. The Applicant's apprehension of loss is therefore, at this stage, speculative. 41. As regards the Respondent's reliance upon the Court of Appeal's judgment in Tata Chemicals Magadi Limited v County Government of Kajiado, Civil Appeal No. 530 of 2019, I do not consider it necessary or appropriate to determine the effect of that judgment upon the merits of the pending appeal in this matter. The Applicant's appeal is before the Court of Appeal, and this Court must refrain from expressing views that may prejudice the appellate consideration of the substantive questions raised therein. 42. Likewise, the fact that the Applicant may have moved the Supreme Court in relation to the said judgment does not, without an order of stay from the competent appellate court, suspend the operation of the Court of Appeal's judgment. 43. Ultimately, the Court is not persuaded that the Applicant has demonstrated the exceptional circumstances necessary to justify stopping the taxation process. If the Applicant ultimately succeeds on appeal, the legal consequences flowing from the costs order can be addressed in accordance with the orders of the appellate Court. __________________________________________________________________ RULING ELC LC E089/25 14

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44. The Court is therefore unable to find that the continuation of taxation will render the pending appeal nugatory, occasion substantial loss to the Applicant, or otherwise result in an injustice that warrants the exercise of the Court's discretion in its favour. 45. In the result, the Court finds that the Applicant has not satisfied the threshold for the grant of a stay of further proceedings in the taxation of the Respondent's Party and Party Bill of Costs dated 19th January 2026. 46. The court finds and holds that the Notice of Motion dated 19th March 2026 is consequently without merit. 47. The application dated 19th March 2026 is hereby dismissed with costs to the Defendant/Respondent. Orders accordingly. Dated Signed and Delivered Virtually this 24th Day of September 2026. M.D. MWANGI JUDGE In the virtual presence of: Ms. Ngina h/b for Ms. Katasi for the Plaintiff/Applicant Mrs. Oliwa for the Defendant/Respondent __________________________________________________________________ RULING ELC LC E089/25 15

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Court Assistant: Alex M.D. MWANGI JUDGE __________________________________________________________________ RULING ELC LC E089/25 16

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