1.Transmara Sugar Company Limited (applicant) filed the Notion of Motion dated March 21, 2023. The application is based on the grounds found on the body of the application and is supported by the affidavit of Emmanuel Seriani, counsel for the applicant sworn on March 10, 2023. The applicant seeks the following orders: -
2.It was deposed that pending the hearing and determination of this appeal, the applicant furnished security by way of bank guarantee of Kes 360,000/= through I & M Bank vide payment guarantee no 001/CB/LG/194/2021; that this court delivered its judgement on January 19, 2023 and dismissed the appeal with costs; that the respondent has proclaimed with the intention of executing; that the applicant has filed a notice of appeal to the Court of Appeal; that if stay of execution is not granted, the appeal will be rendered nugatory and the applicant will suffer risk of irreversible loss. The applicant urged that if this court does not grant the orders to stop the execution, the applicant will suffer substantial loss; that the application has been made without undue and unreasonable delay.
3.The respondent opposed the application through grounds of opposition as follows: -
4.None of the parties filed their respective written submissions. The only issue for determination is whether this court should grant the stay orders.
5.In granting stay orders, this court is guided by the provisions of order 42 rule 6 of the Civil Procedure Rules. In Halai & another vs Thornton & Turpin (1963) Ltd (1990) eKLR, 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 the now, order 42 rule 6 of the Civil Procedure Rules is fettered by three conditions namely, the applicant must establish a sufficient cause; secondly, the court must be satisfied that substantial loss would ensue from a refusal to grant a stay; and thirdly, the applicant must furnish security. Further the application must be made without unreasonable delay.
6.The applicant filed this application after the respondent commenced execution proceedings against it. Judgement was delivered on January 19, 2023. The instant application was filed on March 21, 2023 a period of two months after the judgement. Even if there was some form of delay, yet the applicant has already moved and filed a notice of appeal showing its keenness to challenge the said decision.
7.The applicant contends that it will suffer substantial loss if stay orders are not granted pending appeal. The applicant is apprehensive that the respondent will proceed and recover the decretal sum thereby rendering the intended appeal nugatory. While this court cannot comment on the merits of the intended appeal, it is true that since this court dismissed the appeal with costs to the respondent, the respondent is entitled to proceed with execution if at all the decretal sums are not settled by the applicant. However, the applicant has lodged a notice of appeal to the Court of Appeal.
9.Where execution of a money decree is sought to be stayed, in considering whether the applicant will suffer substantial loss, the financial position of the applicant and that of the respondent becomes a crucial issue. The court cannot shut its eyes where it appears the possibility of the respondent refunding the decretal sum in the event that the applicant is successful in his appeal is doubtful. The court has to balance the interest of the applicant who is seeking to preserve the status quo pending the hearing of the appeal to ensure that his appeal is not rendered nugatory and the interest of the respondent who is seeking to enjoy the fruits of his judgement. In other words, the court should not only consider the interest of the applicant but has also to consider, in all fairness, the interest of the respondent who has been denied the fruits of her judgement.”
10.I am of the view that the applicant will suffer substantial loss in the event that the appeal is successful and the stay orders are not made thereby rendering the intended appeal a nugatory. Had the respondent established that he is a man of means who can refund the decretal sum, then I would have reluctantly allowed this application.
11.On the security to be furnished, the applicants have proposed the furnishing of fresh bank guarantees as security pending the intended appeal. The guiding principles on the purpose of furnishing security pending appeal were aptly stated in the case of Mwaura Karuga t/a Limit Enterprises v Kenya Bus Services Ltd & 4 others (2015) eKLR it was held that:-
14.A summation of the above findings is that even as an appellant wishes to exercise its right of appeal, if the appeal was to be unsuccessful, the respondent should not be put in a position where it finds it difficult or impossible to realize the decree. In making the decision on the mode in which the security is to be furnished, the court is not bound by the proposition of the applicant but it should balance the interests of the both parties.
15.The applicant has undertaken to furnish fresh bank guarantees from Diamond Trust Bank. In balancing the interest of both parties, the applicant will deposit in court half of the total decretal sum in the appeals which this judgement applies to, that is, Civil Appeals Nos. 40, 42, 45 46 and 56 all of 2021 as security and procure fresh bank guarantees for the other half of the decretal sum pending the hearing and determination of the intended appeal.
16.The following orders do issue: -