Kimakia Bus Services Ltd v Electrocom International Ltd (Civil Miscellaneous Application 63 of 1984) (Civ) [1985] KECA 112 (KLR)
The bottom line
#Kenya's Court of Appeal confirmed that even after execution begins, a court can still stop the sale of attached property if an appeal could be ruined.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether execution had been legally completed once the court broker received part of the decretal sum, so that no stay could be granted
- 2.Whether there had been unreasonable delay barring the stay application
- 3.Under what jurisdiction the stay is granted
- 4.Whether the appeal would be rendered nugatory by substantial loss or the respondent's inability to perform the decree
- 5.Whether security for the due performance of the decree or for restitution ought to be ordered
Key legal issues
#Whether legal completion of execution bars a stay of execution
There is no legal bar to a stay arising from the concept of a complete execution; the court retains control over sale proceeds until the judgment-creditor receives them.
The court distinguished the Davis & Shirtliff position, noting the warrant in this case ordered the court broker to hold proceeds until further order and to pay them into court. Where the broker is ordered to pay into court, a different situation arises from that envisaged in Halsbury, and the broker has a good defence to a money had and received claim by producing the warrant. Stay is assessed on a factual basis: while steps remain before the creditor obtains the money, a stay can in principle be ordered.
The jurisdiction and principles governing stay applications under rule 5(2)(b) of the Court of Appeal Rules
The Court of Appeal exercises its own special, unfettered discretion under rule 5(2)(b), normally guided by the principle that an appeal must not be rendered nugatory, considering substantial loss, delay and security.
Although Order XLI of the Civil Procedure Rules also permits application to the Court of Appeal after failure in the High Court, this motion was brought under rule 5(2)(b), which gives the court its own special discretion on such terms as it thinks just. The applicant must show sufficient grounds on affidavit, such as the respondent's poverty, destruction of the substratum of the appeal, or substantial loss.
Whether delay barred the stay application
Although the application could have been brought earlier, the delay was not such as to bar the application, though the applicant must bear costs thrown away.
The application for stay was filed within about a month of execution being applied for. The court accepted the stay could have been sought before execution proceedings, but held the delay was not great enough to render the application ineffective or cause great harm, subject to the applicant paying costs occasioned by the delay.
Whether the appeal would be rendered nugatory and the respondent able to perform the decree
A stay was warranted: sale of the buses (worth Kshs 600,000 against a debt of about Kshs 330,000) would be a staggering blow to the applicant, and the respondent company's precarious finances were not proven capable of repaying the sums.
The court compared the value of attached property to the debt, noting the disproportionate three-to-one ratio and deterioration of the buses, the difficulty of replacing them if the appeal succeeded, the respondent's lack of bank statements or balance sheets, and the uncertainty whether it could repay sums raised on attachment. The more difficult part of the appeal lay above the Kshs 137,100 contractual payment.
Legal principles established
#- Whether or not execution is legally complete, the court retains control over the proceeds of sale until the judgment-creditor actually receives them, and a stay of execution may therefore be ordered until that event occurs.
- A stay application under rule 5(2)(b) of the Court of Appeal Rules is governed by the court's own special discretion, exercised on the general principle that an appeal must not be rendered nugatory.
Court orders
#- 1.The Kshs 65,000 already received be deposited in an interest-bearing account as already ordered, to be carried into effect
- 2.The court broker to pay over the Kshs 90,000 into court, to be placed in an interest-bearing account
- 3.The sale of the buses be stayed unless the respondent raises their attachment in exchange for other satisfactory security (if such is available)
- 4.No security for restitution or for due performance of the decree is ordered
- 5.Costs of the application to the applicant, but the respondent to have the costs thrown away due to the applicant's delay in applying for a stay before attachment
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court of Kenya
- Jurisdiction invoked
- Rule 5(2)(b) of the Court of Appeal Rules (inherent jurisdiction under rule 1(3) also invoked)
Relief refused
#Security under Order XLI rule 5 of the Civil Procedure Rules for restitution of property taken in execution and for due performance of the decree
The property taken in execution can be restored because execution has been stayed, and the judgment debt is already secured in the attached property, so only the costs of the appeal remain and these are also secured
Costs
Costs of the application granted to the applicant (Jogoo Kimakia Bus Services Ltd), but the respondent (Electrocom International Ltd) to have the costs thrown away due to the applicant not applying for a stay at the earliest opportunity before the respondent moved to attach the applicant's property.
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
Accordingly, we allow the application and grant a stay of further execution on the terms set out above.
It follows therefore that whether there is a complete execution or not, the court has control over the proceeds of the sale until the time that the judgment-creditor receives them in his hands, and therefore a stay of execution can be ordered until that event has occurred.
While the discretion is unfettered, the applicant will be required to show on affidavit that he has sufficient grounds for a stay.
It cannot be said that it is such delay as would bar the application.
We grant the costs of this application to the applicant, but the respondent will have the costs thrown away due to the applicant not applying for a stay at the earliest opportunity before the respondent moved to attach the applicant’s property.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kimakia Bus Services Ltd v Electrocom International Ltd (Civil Miscellaneous Application 63 of 1984) (Civ) [1985] KECA 112 (KLR)", Case Analysis (1985). Court of Appeal Motion (rule 5(2)(b)) arising from High Court civil suit; application dated October 19, 1984. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/1985/112/eng@1985-11-19
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.