University of Nairobi v Okura (Employment and Labour Relations Appeal E137 of 2025) [2025] KEELRC 2464 (KLR)

Grounds of the application 2. That the Appellant is aggrieved by the judgment and orders made by the Trial Court on 29th April 2025 in MCELRC No. E420 of 2022, Linet Mirehane Okura v University of Nairobi and has filed this appeal against the said decision. This appeal raises arguable issues and has high chances of success. 3. The Appellant is apprehensive that the Respondent herein may proceed to commence execution against the Appellant thus defeating the substratum of this appeal and rendering the consequent judgment a mere paper judgment. 4. It is therefore necessary that the judgment and or decree issued in MCELRC No. E420 of 2022, Linet Mirehane Okura -Vs- University of Nairobi be stayed pending the hearing and determination of this application and appeal. 5. Kenneth Sawe supported the application through his supporting afidavit dated 9th May 2025 where he annexed the impugned judgment of Hon. Aziza Ajwang dated 29th April 2025 and the filed memorandum of appeal. Response 6. The application was opposed by the respondent through her replying afidavit on 11th June 2025, contending that the Notice of Motion Application as filed herein is a non-starter and an abuse of this Honourable Court's process, and should therefore be struck out in limine with costs awarded to the Respondent. 7. That the Notice of Motion Application as filed herein is a non-starter and an abuse of this Honourable Court's process, and should therefore be struck out in limine with costs to the Respondent. 1. That the Applicant has not advanced any valid reasons justifying a stay of the Honourable Court's judgment which was entered regularly and after taking evidence, reviewing the filed documents and correctly applying the provisions in the Employment Act and the Labour Relations Act. 2. That apart from allusions of substantial loss the deponent has not demonstrated that substantial loss would be occasioned if stay is not granted, as such remains mere allegations. 3. That payment of terminal dues in this case cannot be termed to be substantial loss. 4. That this application has not been brought in good faith as it is a tactic by the Applicant to further stretch litigation as nothing has been presented to demonstrate that the Applicant will be prejudiced if the orders sought are not granted. 5. That no ofier for security has been ofiered by the applicant thus disentitling her of the orders sought. Decision Whether the application was merited. 8. The application was canvassed by way of written submissions. Both parties filed, and the court took into consideration the submissions in its decision. 9. The Employment and Labour Relations Court (Procedure) Rules 2024 on stay of execution in the case of appeal being lodged states:- https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/2464/eng@2025-09-18 2

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‘’21. 10. (1) Where an application for stay of execution pending appeal has been lodged, the applicant shall, in the supporting afidavit, declare whether a similar application has been filed in any other court (2) An application for stay of execution pending appeal shall be filed in the appeal file.’’ Rule 73 of the Court for states:- ‘(2) Rules on execution or stay of execution of an order or decree of the Court shall be in accordance with the Civil Procedure Rules.’’ Order 42 Rule 6 (2) of the Civil Procedure Rules reads:‘(2) 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.’’ The applicant filed a memorandum of appeal dated 9th May 2025 received in court on even date. The impugned Judgment was delivered 29th April 2025 thus appeal filed within the statutory timeline of 30 days. 11. The Court finds that the application dated 9th May 2025 received on the same date was filed without undue delay, the judgment having been delivered on 29th April 2025. The respondent submitted there was no demonstration of substantial loss and relied on James Wangalwa & Another vs. Agnes Naliaka Cheseto [2012] eKLR where the court expressed itself as hereunder: "No doubt, in law, the fact that the process of execution has been put in motion, or is likely to be put in motion, by itself, does not amount to substantial loss. Even when execution has been levied and completed, that is to say, the attached properties have been sold, as is the case here, does not in itself amount to substantial loss under Order 42 Rule 6 of the CPR. This is so because execution is a lawful process. The applicant must establish other factors which show that the execution will create a state of afiairs that will irreparably afiect or negate the very essential core of the applicant as the successful party in the appeal ... the issue of substantial loss is the cornerstone of both jurisdictions. Substantial loss is what has to be prevented by preserving the status quo because such loss would render the appeal nugatory. 12. Conversely, the applicant submitted that it is a public institution fully funded by the Treasury and shall readily abide by the orders of this Honourable Court. 13. The applicant submitted that the Respondent has not discharged the evidential burden of proof of means in their Replying Afidavit by failing to demonstrate financial capability of refunding the substantial decretal sum in the event that the appeal succeeds. The Respondent has not adduced any evidence to demonstrate ownership and value of any assets that she owns; nor has she provided any statement of her accounts with any financial institution. There is thus nothing on record to show that the Respondent is possessed of suficient means to refund the decretal sum were the appeal to succeed. In Cooperative Bank of Kenya -Vs- Taramusi Francis Ongoki [2019] eKLR it was observed " the petitioner has failed to prove that he is in a position to reimburse the decretal amount if the appeal succeeds and in that regard the applicant may sufier substantial loss". 14. The Court noted that the judgment sum of Kshs 926,687.05 plus interest and costs was substantial. The Respondent is correct in stating that the subject decree, being a money decree, can be refunded if the Intended Appellant is successful. However, she has not demonstrated her ability to re-pay the decretal sum. The test for whether an Applicant will sufier substantial loss where a money decree is in https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/2464/eng@2025-09-18 3

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issue was set out in the case of Century Oil Trading Company Ltd vs. Kenya Shell Limited Nairobi (Milimani) HCMCA No. 1561 of 2007 where the court held:“Where execution of a money decree is sought to be stayed, in considering whether the applicant will sufier substantial loss, the financial position of the applicant and that of the respondent becomes an issue. The court cannot shut its eyes where it appears the possibility is doubtful of the respondent refunding the decretal sum in the event that the applicant is successful in his appeal. The court has to balance the interest of the applicant who is seeking to preserve the status quo pending the hearing of the appeal so that his appeal is not rendered nugatory and the interest of the respondent who is seeking to enjoy the fruits of his judgment.” 15. On the third condition of security under Order 46 Rule (2)b) of the Civil Procedure Rules - it is true that the applicant has not ofiered security and submitted as follows:- ‘This is further exacerbated by the fact that the Applicant is a public university and is funded from the Exchequer.’’ In Ethics & Anti-Corruption -Vs- Peter Mangiti & 17 Others [2016] eKLR, the High Court finding no dispute that a "colossal sum" constituting "public money" was involved in the suit held that provided that hearing and determination of the Appeal would be expedited, "it is in the public interest that the public cofiers money be protected until this suit is heard and determined." In the case of Lemanken Aramat-Vs- Harun Meitamei Lempanka & 2 Others [2014] eKLR, the Supreme Court upon weighing similar competing claims as in the present case against the background of the public cause focused its perception on the public interest in Article 201 of the Constitution which require that public funds be utilized in a prudent and responsible way and held that "the Applicant has made a proper case for grant of interlocutory orders pending the hearing and determination of the appeal".The applicant urged for an identical finding and submit that to commit substantial public funds by efiecting payment while it is most probable that the Award will be set aside in entirety or substantially varied will not be in accord with Article 232 (1) (b) of the Constitution which demand prudent use of public resources. That the Court to issue an order of stay of execution without making a security deposit as a condition for grant of stay. In the unlikely event the Appeal fails, the Applicant being a public university shall be in a position to make immediate payment of the decretal sum to the Respondent. In Teachers Service Commission-Vs- Benson Kuria Mwangi [2020] eKLR the court observed that "a public institution" such as the 1st Respondent herein "is not required to deposit security by virtue of Order 42 Rule 8 of the Civil Procedure Rules" and urge this Honourable Court to allow the Respondent's Motion dated 1st September 2020 as prayed. 16. Conversely, the respondent submitted as follows on the condition of security- As stated in paragraph 9 of the Respondent's Replying Afidavit, the Appellant has not ofiered any security for costs, which is a fundamental requirement for grant of stay of execution pending appeal. The applicant seeking stay must demonstrate willingness to safeguard the decretal amount by ofiering suitable security. This has been the case in a myriad of instances before courts In Absalom Dova vs. Tarbo Transporters [2013] eKLR, stated: "The discretionary relief of stay of execution pending appeal is designed on the basis that no one would be worse ofi by virtue of an order of the court; as such order does not introduce any disadvantage, but administers the justice that the case deserves. This is in recognition that both parties have rights; the Appellant to his appeal which includes the prospects that the appeal will not be rendered nugatory; and the decree holder to the decree which includes full benefits under the decree. The court in balancing the two competing rights focuses on their reconciliation..." In Mwaura Karuga t/a Limit Enterprises vs. Kenya Bus Services Ltd & 4 Others [2015] eKLR, it was said: "... the security must be one which shall achieve due performance of the decree which might ultimately be binding on the applicant. The rule does not, therefore, envisage just any security. The words "ultimately be binding' are deliberately used and are useful here, for they refer to the entire decree as will be payable at the time the appeal is lost. That is the presumption of law here. Therefore, the ultimate decree envisaged under order 42 rule 6 (2) (b) of the Civil Procedure Rules includes costs and interest on the judgment sum https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/2464/eng@2025-09-18 4

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unless the latter two were not granted-which is seldom. The security to be given is measured on that yardstick." To this end the Respondent noted that the Applicant despite being a huge institution with the financial muscle to ofier security, have avoided the issue of security altogether by arguing that they are part of government. This is a critical condition which has not been addressed in the application. In ELRC Cause No. 1191 of 2018 Reuben Ondigu Orodo vs University of Nairobi the court observed as follows; "The University of Nairobi is not an organization of the Government as contemplated under the government proceedings act. The Respondent/Applicant must therefore meet its debts and in particular satisfy any decretal sums made against it pursuant to civil litigation by its employees as in the matter to avoid any execution proceedings being made against it be it by way of attachment or issuance of mandamus against its oficials. The Respondent/Applicant must satisfy the judgment debt herein accordingly." In Muthui v Kasivu (Civil Appeal E268 of 2023) [2024] KЕНС 9627 KLR, where the court observed: "On the ability of the Respondent financial incapability of paying back the decretal sum being one of the reasons the orders should be granted as submitted by the applicant, I beg to difier. The onus of proving the Respondent's inability goes beyond throwing an allegation without evidence. It is upon the Applicant who alleges the same to go ahead and prove it. Nonetheless, the court has settled this matter and stated that this should not be the reason an order of stay is granted.’’ 17. The court established that it was not in dispute the applicant was a public body funded by the exchequer. Indeed, even the awarded gratuity would be paid by public monies. The court in the application is concerned about whether the applicant fits under Order 46(8) of the Civil Procedure Rules to wit:- ‘8. No security to be required from the Government [Order 42, rule 8]No such security as is mentioned in rules 6 and 7 shall be required from the Government or where the Government has undertaken the defence of the suit or from any public oficer sued in respect of an act alleged to be done by him in his oficial capacity.’’ The Act does not define what government is. However public ofice is defined under the constitution as “public ofice” means an ofice in the national government, a county government or the public service, if the remuneration and benefits of the ofice are payable directly from the Consolidated Fund or directly out of money provided by Parliament; ‘’There is no doubt that the respondent is a public university. Section 45 of the Universities Act provides for funding of the public universities as follows:- ‘45. Funds of a public university (1) The funds of a public university shall comprise of— (a) such sums as may be provided by Parliament; (b) such monies or assets as may accrue to or vest in the public university in the course of the exercise of its powers or the performance of its functions under this Act or under any other written law; and (c) all monies from any other source provided for or donated or lent to the public university. (2) There shall be made to the public university, out of monies provided by Parliament for that purpose, grants towards the expenditure incurred in the exercise of its powers or in performance of its functions under this Act.’’ Section 47 of the same Act provides for audit of the university as follows:- ‘’47. Accounts and audit (1) A public university shall cause to be kept all proper books of records of accounts of the income, expenditure and the assets of the university. (2) Within four months from the end of each financial year, a public university shall submit to the auditor general corporations the accounts of the university together with — (a) a statement of the income and expenditure of the university during the financial year; and (b) a balance sheet of the university on the last day of the year. (3) The accounts of a public university shall be audited and reported upon in accordance with the provisions of the Public Audit Act, 2003 (Cap. 412B)’’The court is persuaded to find that the applicant fits to be under government for the purposes of Order 46 (8) of the Civil Procedure Rules hence exempt from deposit of security of costs. The court found the decision ELRC Cause No. 1191 of 2018 Reuben Ondigu Orodo vs University of Nairobi related to the application of Government Proceedings Act hence the facts are distinguished. 18. The court finds that it is in the public interest to grant the application for a stay of execution, noting that the money decree is to be settled from public funds and that the respondent has not demonstrated https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/2464/eng@2025-09-18 5

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the financial capacity to refund the money in the event the intended appeal is successful. Furthermore, there is a real risk that the appeal could become nugatory. The court, being the court of first appeal, was persuaded that the appeal raised arguable points, considering the decision of the court on the subject matter of the said CBA in Nairobi Cause No. E722 of 2022, The University of Nairobi v KUDHEIHA and others. 19. In conclusion, the application is granted. A temporary order of stay of execution is issued against the Judgment and Decree by Hon Aziza Ajwang dated 29th April 2025 in MCELRC No. E420 of 2022, Linet Mirehane Okura v University of Nairobi, pending the hearing and determination of this appeal. The court is to fast-track the appeal in the interest of justice and not to prejudice the decree holder. 20. Costs of the application in the cause. 21. The applicant is directed to obtain the typed proceedings of the lower court and file the record of appeal within 30 days. Mention on 16th October 2025 to confirm status and issue further directions. 22. It is so ordered. DATED, SIGNED, AND DELIVERED IN OPEN COURT AT NAIROBI THIS 18TH DAY OF SEPTEMBER, 2025. J.W. KELI, JUDGE. In The Presence Of: Court Assistant: Otieno Appellant – Omondi Respondent: Onenga https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/2464/eng@2025-09-18 6

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