Safaricom Limited v King’oo & another (Civil Appeal E174 of 2021) [2022] KEHC 3141 (KLR) (5 May 2022) (Ruling)
Neutral citation:
[2022] KEHC 3141 (KLR)
Republic of Kenya
Civil Appeal E174 of 2021
GV Odunga, J
May 5, 2022
Between
Safaricom Limited
Appellant
and
Dickson Kimweli King’oo
1st Respondent
Invesco Assurance Company Limited
2nd Respondent
Ruling
1.The Appellant is the Garnishee, the 1st Respondent the Decree holder and the 2nd Respondent the Judgement debtor.
2.Vide a Notice of Motion Application dated November 8, 2021 brought under Order 42 Rule 6, Order 40, Order 45 Rule 1,2, Order 51 Rule 1 of the Civil Procedure Rules, 2010, Section 3A of the Civil Procedure Act, Cap 21, the Appellant seeks the following orders;a.Spentb.Spentc.That the court be pleased to stay execution of the Garnishee Order Absolute issued on October 13, 2021 against the Applicant/ Appellant/Garnishee pending the hearing and determination of Machakos High Court Civil Appeal number 174 of 2021 dated October 27, 2021 and filed on even date lodged by the Applicant/ Appellant/ Garnisheed.Spente.That this Honourable court do issue an injunction restraining the 1st Respondent /Decree Holder by himself, his agents, employees and/or assigns from in any way whatsoever dealing with, attaching, disposing of, auctioning or otherwise interfering with the Applicant/Appellant/Garnishee’s movable property and any other attachable asset in satisfaction of the Garnishee Order Absolute issued on October 13, 2021 herein pending hearing and determination of the Appeal.f.That the proclamation of attachment issued on 2nd November 2021 through Betabase Auctioneers is lifted.g.That the court be pleased to review/vary/alter and/or set aside the Garnishee Order Absolute issued on October 13, 2021 against the Garnishee in terms it may deem fit.h.That costs of the application be provided for.i.That the 2nd Respondent/Judgement Debtor be directed to pay the Auctioneer fees following its proclamation of attachment dated November 2, 2021.j.That such further and other relief be granted to the Applicant/Appellant/Garnishee as this court deems just and expedient in the circumstances.
3.The application is supported by the affidavit of the Appellant’s Senior Manager-litigation, Daniel Ndaba sworn on November 8, 2021. According to the deponent, the Appellant who changed name to Safaricom Public Limited Company, has filed an Appeal against the Ruling of the Resident Magistrate, Hon. Eric Musambai Analo, delivered on 13th October 2021 in Machakos CMCC 167 of 2018 which raises arguable issues and thus the decree absolute issued on October 13, 2021 is inexplicable in the circumstances.
4.It was his contention that the Learned Trial Magistrate gave blanket orders without considering that there was no money in the judgement debtor’s pay bill number being 980100 and 980101 to settle the decretal sum and that the statements for 1st of January 2021 to 27th August 2021 were up to date and others not conveniently left out. He opined that once the interim order lapsed on 29th October 2021, the 1st Respondent/ Decree holder commenced execution through Betabase Auctioneers who proclaimed the Appellant’s movable goods and which proclamation notice lapsed on November 9, 2021.
5.It was averred that the Appellant has obtained certified typed proceedings, certified copy of ruling and a certified copy of the garnishee order and is intent on prosecuting the appeal. However, unless the stay sought is granted, the appeal is likely to be rendered nugatory and the Appellant stands to suffer substantial loss, injury and inconvenience. He also intimated that there is an application dated January 15, 2021 against the 2 garnishees whose ruling was to be delivered on April 22, 2021.
6.The Garnishee filed a Further Affidavit sworn by its Senior Manager- Litigation dated November 8, 2021 reiterating contents of the Supporting affidavit.
7.In response to the application, the 1st Respondent/ Decree holder filed a replying affidavit dated 10th of November 2021 wherein he deposed that upon lapse of the stay orders issued by the trial court on 29th October 2021, he instructed Betabase Auctioneers to proclaim the garnishee’s goods, further incurring auctioneer fees of Kshs. 288,784 which the Garnishee ought to pay. Further, that the garnishee has not demonstrated the prejudice it will suffer if execution is carried out and the fact that he has filed this Appeal does not mean it is strong on merit. It was averred that it was the Garnishee that failed to disclose the financial relationship between them and the Judgement Debtor.
8.The Decree Holder averred that he was in a position to refund the money in the event the Appeal succeeds and prayed in the alternative that the Garnishee deposits Kshs 1,639,140 in a joint interest earning account of both counsel pending hearing and determination of the Appeal as well as pay the auctioneers fees.
9.In a rejoinder, the Garnishee vide a supplementary affidavit dated November 19, 2021 deposed the Decree Holder should not have commenced proclamation having served him with the order Absolute which indicated that he would commence contempt proceedings. It was further contended that since the garnishee order was for Kshs 1,639,140.00, the Auctioneers should not have attached for Kshs 1,472,837.00 hence the execution process was flawed. Further, that since the auctioneer’s fees had not been substantiated as there was no attachment, the garnishee ought not to held liable to pay the accrued auctioneers fees. It was asserted that the auctioneers did not access their offices because of the tight security and only sent an email as well a letter to their advocates and therefore the process and documentation were improper.
10.He contended that the order for deposit of security was not necessary as the Decree Holder had not substantiated his financial means.
Determination
11.I have considered the application, the supporting affidavit and the grounds of opposition to the application and the submissions filed.
12.The principles guiding the grant of a stay of execution pending appeal are well settled. These principles are provided under Order 42 rule 6(2) of the Civil Procedure Rules which provides as follows: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.
13.In Vishram Ravji Halai v Thornton & Turpin Civil Application No. Nai. 15 of 1990 [1990] KLR 365, the Court of Appeal held that whereas the Court of Appeal’s power to grant a stay pending appeal is unfettered, the High Court’s jurisdiction to do so under Order 41 rule 6 of the Civil Procedure Rules is fettered by three conditions namely, establishment of a sufficient cause, satisfaction of substantial loss and the furnishing of security. Further the application must be made without unreasonable delay. To the foregoing I would add that the stay may only be granted for sufficient cause and that the Court in deciding whether or not to grant the stay and that in light of the overriding objective stipulated in sections 1A and 1B of the Civil Procedure Act, the Court is nolonger restricted to the foregoing provisions. The courts are now enjoined to give effect to the overriding objective in the exercise of its powers under the Civil Procedure Act or in the interpretation of any of its provisions. According to section 1A(2) of the Civil Procedure Act “the Court shall, in the exercise of its powers under this Act or the interpretation of any of its provisions, seek to give effect to the overriding objective” while under section 1B some of the aims of the said objective are; the just determination of the proceedings; the efficient disposal of the business of the Court; the efficient use of the available judicial and administrative resources; and the timely disposal of the proceedings, and all other proceedings in the Court, at a cost affordable by the respective parties.
14.It therefore follows that all the pre-overriding Objective decisions must now be looked at in the light of the said provisions. This does not necessarily imply that all precedents are ignored but that the same must be interpreted in a manner that gives effect to the said objective. What is expected of the Court is to ensure that the aims and intendment of the overriding objective as stipulated in section 1A as read with section 1B of the Civil Procedure Act are attained. It is therefore important that the Court takes into consideration the likely effect of granting the stay on the proceedings in question. In other words, the Court ought to weigh the likely consequences of granting the stay or not doing so and lean towards a determination which is unlikely to lead to an undesirable or absurd outcome. What the Court ought to do when confronted with such circumstances is to consider the twin overriding principles of proportionality and equality of arms which are aimed at placing the parties before the Court on equal footing and see where the scales of justice lie considering the fact that it is the business of the court, so far as possible, to secure that any transitional motions before the Court do not render nugatory the ultimate end of justice. The Court, in exercising its discretion, should therefore always opt for the lower rather than the higher risk of injustice. See Suleiman v Amboseli Resort Limited [2004] 2 KLR 589. This was the position of Warsame, J (as he then was) in Samvir Trustee Limited v Guardian Bank Limited Nairobi (Milimani) HCCC 795 of 1997 where he expressed himself as hereunder:
15.Similar view was adopted in in RWW v EKW [2019] eKLR, where it was held that:
16.It was therefore opined in Absalom Dova v Tarbo Transporters [2013] eKLR, that the discretionary relief of stay of execution pending appeal is designed on:
17.Therefore, this Court must guard against any action or inaction whose effect may remove pith of this litigation and leave only a shell as was appreciated by the Court of Appeal position in Dr Alfred Mutua v Ethics & Anti-corruption Commission & others Civil Application No Nai 31 of 2016 in which it cited the Nigerian Court of Appeal decision of Olusi & another Abanobi & others [suit No CA/B/309/2008] that:
18.It is trite that in giving effect to the rights the courts must balance fundamental rights of individual against the public interest in the attainment of justice in the context of the prevailing system of legal administration and the prevailing economic, social and cultural conditions. See Bell v DPP [1988] 2 WLR 73.
19.Apart from that as the Supreme Court appreciated in Gitirau Peter Munya v Dickson Mwenda Kithinji & 2 others [2014] eKLR, the Court must consider whether or not it is in the public interest that the order of stay be granted and that this condition is dictated by the expanded scope of the Bill of Rights, and the public spiritedness that run through the Constitution.
20.On the first principle, Platt, Ag JA (as he then was) in Kenya Shell Limited v Kibiru [1986] KLR 410, at page 416 expressed himself as follows:
21.On his part, Gachuhi, Ag JA (as he then was) at 417 held:
22.Dealing with the contention that the fact that the respondent is in need of finances is an indication that he would not be in position to refund the decretal sum, Hancox, JA (as he then was) in the above cited case when he expressed himself as follows:
23.Therefore, the mere fact that the decree holder is not a man of means does not necessarily justify him from benefiting from the fruits of his judgement. On the other hand, the general rule is that the Court ought not to deny a successful litigant of the fruits of his judgement save in exceptional circumstances where to decline to do so may well amount to stifling the right of the unsuccessful party to challenge the decision in the higher Court. In Machira t/a Machira & Co Advocates v East African Standard (No 2) [2002] KLR 63 it was held that:
24.Where the allegation is that the respondent will not be able to refund the decretal sum the burden is upon the applicant to prove that the Respondent will not be able to refund to the applicant any sums paid in satisfaction of the decree. See Caneland Ltd & 2 others v Delphis Bank Ltd Civil Application No Nai 344 of 1999.
25.The law, however appreciates that it may not be possible for the applicant to know the respondent’s financial means. The law is therefore that all an applicant can reasonably be expected to do, is to swear, upon reasonable grounds, that the Respondent will not be in a position to refund the decretal sum if it is paid over to him and the pending appeal was to succeed but is not expected to go into the bank accounts, if any, operated by the Respondent to see if there is any money there. The property a man has is a matter so peculiarly within his knowledge that an applicant may not reasonably be expected to know them. In those circumstances, the legal burden still remains on the applicant, but the evidential burden would then have shifted to the Respondent to show that he would be in a position to refund the decretal sum. See Kenya Posts & Telecommunications Corporation v Paul Gachanga Ndarua Civil Application No Nai 367 of 2001; ABN Amro Bank, NK v Le Monde Foods Limited Civil Application No 15 of 2002.
26.That position was adopted by the Court of Appeal decision in National Industrial Credit Bank Limited v Acquinas Francis Wasike & anor - Civil Appl No 238 of 2005 (UR) where the Court stated as follows: -
27.What amounts to reasonable grounds for believing that the respondent will not be able to refund the decretal sum is a matter of fact which depends on the facts of a particular case. In my view even if it were shown that the respondent is a man of lesser means, that would not necessarily justify a stay of execution as poverty is not a ground for denial of a person’s right to enjoy the fruits of his success. As was held in Stephen Wanjohi v Central Glass Industries Ltd Nairobi HCCC No 6726 of 1991, financial ability of a decree holder solely is not a reason for allowing stay; it is enough that the decree holder is not a dishonourable miscreant without any form of income.
28.However, the mere fact that execution process has been set into motion is not evidence of substantial loss. In the case of James Wangalwa & another v Agnes Naliaka Cheseto [2012] eKLR, the Court therefore held that:
29.In this case, the Applicant is a garnishee. It is contended that it is holding funds to the credit of the Judgement Debtor. Clearly the funds in question, if any, is not the Garnishee’s funds but funds held to the credit of a third party. The circumstances herein are not the same as in the usual cases where the execution is against the judgement debtor. To compel the Garnishee to pay the said sum when its liability is contested, in the circumstances of this case may amount to substantial loss.
30.In the case of Dickson Isabwa Angaluki & 2 others v Ukwala Supermarkets Ltd & 2 others [2013] eKLR it was held that:
31.As was observed by Kamau, J in Civil Appeal No 634 of 2017 - Magnate Ventures v Simon Mutua Muatha & another [2018] eKLR:-
32.In any event, in Halai & another v Thornton & Turpin (1963) Limited [1990] eKLR the Court of Appeal held that:-
33.In the case of Equity Bank Limited vs. Francis O G Matete & another [2022] eKLR, the court while granting stay of execution pending appeal and stated that;
34.Based on the foregoing, I find that the Applicant has successfully surmounted the first condition for grant of stay pending an appeal.
35.As for the delay, none was alleged and I do not find that any undue delay in the circumstances of this case.
36.As regards security, I associate myself with the holding in Mwaura Karuga t/a Limit Enterprises v Kenya Bus Services Ltd & 4 others [2015] eKLR, where it was said:
37.I also agree with the decision in Gianfranco Manenthi & another v Africa Merchant Assurance Company Ltd [2019] eKLR, in which the court observed:
38.In the result the order that commends itself to me and which I hereby grant is that there will be a stay of execution of the judgement appealed from pending the hearing and determination of the appeal on condition that the applicant deposits the decretal sum in a joint interest earning account with Kenya Commercial Bank, Machakos Branch within 30 days from the date of this decision and in default, the application will be deemed to have been dismissed in which event the Respondent will be at liberty to execute for the full amount.
39.There will be no order as to costs as none of the parties complied with the directions to furnish soft copies of the proceedings/pleadings in word format. It is so ordered.
READ, SIGNED AND DELIVERED IN OPEN COURT AT MACHAKOS THIS 5TH DAY OF MAY, 2022.G V ODUNGAJUDGEDelivered in the presence of:Ms Rweya for the Appellant/ApplicantCA Susan