1.The motion dated 14.06.2021 by Rentworks East Africa Ltd (hereafter the Applicant) seeks to stay execution of the judgment delivered in Nairobi Milimani CMCC No. 1348 of 2019 pending hearing and determination of the impending appeal. The motion is expressed to be brought under Order 42 Rules 6 of the Civil Procedure Rules, inter alia, and premised on the grounds on the face of the motion as amplified in the supporting affidavit sworn by Sarah Nyamache, the Finance and Administration Manager of the Applicant, authorized by the board of directors and therefore competent to swear the affidavit.
2.To the effect that being aggrieved and dissatisfied with the judgment of the lower court delivered in Nairobi Milimani CMCC No. 1348 of 2019 on 07.05.2020 in favour of Luka Gichuhi Waweru (hereafter the 1st Respondent), the Applicant has preferred an arguable appeal. She proceeds to express apprehension that unless stay of execution is granted the 1st Respondent will extract a decree and commence execution against the Applicant leading to substantial and “irreparable loss”. That the 1st Respondent will not be prejudiced by the instant application which has been filed without unreasonable delay.
3.The 1st Respondent opposes the motion through a replying affidavit in which he asserts that the same is an afterthought and brought in bad faith with the sole intent of preventing him from enjoying the fruits of his judgment. Like the Applicant he depones to the merits of the appeal. He asserts that the Applicant has not demonstrated the anticipated loss should the orders of stay of execution not be granted whereas the lodging of an appeal does not automatically stay execution of the judgment appealed from. In his view, the Applicant while seeking equitable relief before this court does so with unclean hands having failed to put to good use the stay of execution order granted before the lower court. He urges the court to dismiss the motion and, in the alternative, if inclined to allow the same, to impose conditions for provision of security for the eventual performance of the decree.
4.The motion was canvassed by way of written submissions. As regards the applicable principles, counsel for the Applicant anchored his submissions on the provisions of Order 42 Rule 6 of the Civil Procedure Rules. On substantial loss counsel cited the James Wangalwa & Another v Agnes Naliaka Cheseto  eKLR, and Kenya Shell Limited v Benjamin Karuga Kibiru  KLR 410, RWW v EKW  eKLR for the proposition that the decree herein is a money decree and the court cannot shut its eyes to the possibility that the 1st Respondent may not be in a position to refund the decretal sum in the event the appeal is successful, thus rendering the appeal nugatory. Addressing the issue of security counsel cited the decisions in Arun C. Sharma v Ashana Raikundalia t/a Rairundalia & Co. Advocates & 2 Others  eKLR and Focin Motorcycle Co. Ltd v Ann Wambui Wangui & Another  eKLR and reiterated the Applicant’s willingness to provide such security as the court may order.
5.On behalf of the 1st Respondent, counsel similarly citing the applicable principles under the provisions of Order 42 Rule 6 of the Civil Procedure Rules submitted that the relief sought herein is discretionary and it has often been said that the discretion must be exercised judicially, that is, upon defined principles of law and not capriciously or whimsically. On the issue of substantial loss he relied on several decisions including Civil Appeal No. E121 of 2021 Shoko Molu Beka & Another v Augustine Gwaro Mokamba, Macharia t/a Macharia & Co Advocates v East Africa Standard (No.2) (2002) KLR 63 and James Wangalwa (supra) to assert that the matter of substantial loss is a factual issue which must be raised in the supporting affidavit and that the Applicant has not placed before the court evidential material on the basis of which this court can find that the Applicant stands to suffer substantial loss unless stay is granted. Concerning provision of security counsel cited the decisions in Masisi Mwita v Damaris Wanjiku Njeri  eKLR, Equity Bank Ltd v Taiga Adams Company Ltd  eKLR and Edward Kamau & Another v Hannah Mukui Gichuki Misc. 78 of 2015 in urging the position that the Respondent is entitled to equal treatment before the law hence it is in the interest of justice the Applicant be ordered to furnish security. Counsel concluded by submitting that the court should balance the rights of both parties particularly the 1st Respondent who has a lawful judgment. The court was urged to dismiss the motion with costs.
6.The 2nd Respondent did not participate in the instant proceedings before this court.
7.The court has considered the material canvassed in respect of the motion. The Applicant, and to some extent the 1st Respondent by their affidavit material and submissions addressed the merits of the appeal. At this interlocutory stage, the court is not concerned with the merits of the appeal. The power of the court to grant stay of execution of a decree pending appeal is discretionary, however the discretion should be exercised judicially. See Butt v Rent Restriction Tribunal  KLR 417.
8.The Applicant’s motion is brought under Order 42 Rule 6 of the Civil Procedure Rules which provides that:
9.The cornerstone consideration in the exercise of the discretion is whether the Applicant has demonstrated the likelihood of suffering substantial loss if stay is denied. One of the most enduring legal authorities on the issue of substantial loss is the case of Kenya Shell (supra). The principles enunciated in this authority have been applied in countless decisions of superior courts, including those cited by the parties herein. Holdings 2, 3 and 4 of the Shell case are especially pertinent. These are that:
10.The decision of Platt Ag JA, in the Shell case, in my humble view set out two different circumstances when substantial loss could arise, and therefore giving context to the 4th holding above. The Platt Ag JA (as he then was) stated inter alia that:
11.The learned Judge continued to observe that: -
12.Earlier on, Hancox JA in his ruling observed that
13.The deponent of the affidavit in support of the motion expresses apprehension that unless stay of execution is granted the 1st Respondent will extract a decree and proceed to execute against the Applicant which action, if not stayed, will occasion substantial and irreparable loss. The 1st Respondent’s response was that the Applicant has not demonstrated the loss to be suffered. The mere fact that the process of execution is likely to be or has been initiated by the 1st Respondent is not evidence of substantial loss. Execution in satisfaction of a decree is a lawful process, and the Applicant was duty bound to demonstrate how substantial loss would arise in this instance, by showing, either that if the appeal were to succeed, the 1st Respondent would be unable to refund any monies paid to him under the decree, or that payments in satisfaction of the decree would occasion difficulty to the Applicant.
14.It seems that having failed to depose to the matter in the supporting affidavit, the Applicants sought to do so in its submissions. That attempt can only be described as too little too late. As the 1st Respondent correctly observed, the question of substantial loss is one of fact and a successful applicant must demonstrate substantial loss through affidavit evidence. As stated in the Shell case, substantial loss is the cornerstone consideration in the court’s exercise of discretion in an application seeking stay of execution. And therefore, the court in the Shell case held that without a demonstration of substantial loss, it would be rare that any other event would render the appeal nugatory and justify keeping the decree holder out of his money.
15.It is therefore not enough for the Applicant to merely assert that execution will lead to substantial loss; it must be shown how such loss will arise. Substantial loss in its various forms, is the cornerstone of the jurisdiction for granting stay. That is what must be prevented. Therefore, without this evidence, it is difficult to see why the execution process should be stayed. In the court’s view, the Applicant herein has not demonstrated substantial loss and therefore the likelihood of the appeal being rendered nugatory. In the circumstances, the motion dated 14.06.2021 must fail and is dismissed with costs.