Automated Summary
Key Facts
The defendant (African Safari Club) applied for a stay of execution pending an appeal against a Kshs. 141,862,365.98 judgment. The court ruled that the applicant demonstrated sufficient cause, as paying the decretal sum to the respondent (Safe Rentals Ltd) risked irrecoverable loss due to the applicant's heavy debts. The court ordered the applicant to deposit Kshs. 7,218,664.00 into a joint account and provide a bank guarantee of Kshs. 134,643,701.98 within 30 days, with the stay conditional on compliance. The respondent opposed the application, arguing it was filed late and no evidence of irrecoverable loss was provided.
Issues
- The court addressed the security requirements under Order XLI Rule 4. The applicant requested an unconditional stay but failed to propose any security during the hearing. The judge noted that while security was required, the applicant could still obtain a stay if other conditions were met. Orders were made for the applicant to provide specific security within 30 days, with dismissal otherwise.
- The court considered whether there was sufficient cause to stay the execution of the judgment pending appeal. The applicant argued that the decretal sum, if paid to the respondent, would be irrecoverable, leading to substantial loss. The respondent contested this, asserting no evidence of irrecoverability. The judge found that the applicant had shown sufficient cause and potential substantial loss.
Holdings
- A stay of execution was ordered pending compliance with the deposit and security requirements.
- An additional stay of execution was granted pending the intended appeal, contingent on compliance with the deposit and security orders.
- The applicant was required to provide a bank guarantee or performance bond for Kshs. 134,643,701.98 within 30 days from the ruling date.
- The application for a stay of execution was conditionally granted; if the applicant fails to comply with the deposit and security orders within 30 days, the motion will be dismissed with costs. Costs of the application will otherwise abide by the appeal's outcome.
- The court determined that the applicant (defendant) has demonstrated sufficient cause for a stay of execution, as the decretal amount if paid to the respondent may prove irrecoverable, leading to substantial loss. The applicant's business is in recovery mode, and the respondent has not provided assurance of repayment if the appeal succeeds.
- The applicant was ordered to pay Kshs. 7,218,664.00 into an interest-earning bank or financial institution account in the joint names of the parties' advocates within 30 days from the ruling date.
Remedies
- The costs associated with this application are to abide by the results of the intended appeal. If the appeal is successful, the costs will be determined accordingly.
- The applicant must secure a guarantee from a reputable bank or financial institution or a performance bond from a reputable insurance company for Kshs. 134,643,701.98 within thirty (30) days from the ruling date.
- The applicant is required to deposit Kshs. 7,218,664.00 into an interest-earning bank or financial institution account in the joint names of the advocates of the parties within thirty (30) days from the date of the ruling.
- Execution is stayed pending the applicant's compliance with the payment and guarantee requirements (orders 1 and 2), and further pending the hearing and determination of the intended appeal to the Court of Appeal.
Monetary Damages
141862365.98
Legal Principles
The court applied Order XLI Rule 4 of the Civil Procedure Rules to assess the stay of execution application. It emphasized that a stay should be granted if there is sufficient cause (e.g., meritorious appeal) and potential substantial loss to the applicant. The ruling highlighted that the applicant demonstrated both elements, and the requirement for security was addressed by ordering the applicant to deposit funds and provide a bank guarantee, even though they failed to propose security during the hearing. The principle that failure to furnish security is not a bar if other requirements are met was also applied.
Cited Statute
- Civil Procedure Rules
- Civil Procedure Act
Judge Name
- Ibrahim J
- F. Azangalala
Passage Text
- I further order that there be a stay of execution pending the intended appeal if the applicant complies with 1 and 2 above.
- The applicant to pay Kshs. 7,218,664.00 into an interest earning bank or financial institution account in the joint names of the advocates of the parties within thirty (30) days from the date hereof.
- the applicant has demonstrated not only sufficient cause but also that substantial loss may result to it unless the order of stay of execution is made.