ORARO & RACHIER ADVOCATES vs CO-OPERATIVE BANK OF KENYA LIMITED [2000] KECA 311 (KLR)
The bottom line
#Kenya's Court of Appeal paused a KSh 8.7 million judgment against a law firm, finding the High Court skipped required steps before enforcing an alleged advocate's undertaking.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the applicant has arguable issues on the intended appeal, including whether the Judge could enter enforcement judgment without recording special reasons under Order 52 rule 7(2)
- 2.Whether a judgment read and dated by the Principal Deputy Registrar is a valid judgment of the superior court
- 3.Whether the correspondence disclosed a binding professional undertaking by the advocates
- 4.Whether there was accord and satisfaction by acceptance of the cheque sent in full and final settlement
- 5.Whether the intended appeal would be rendered nugatory if stay is not granted
Key legal issues
#Arguability of the enforcement order made without recorded special reasons
The Judge's entry of judgment for the bank without recording special reasons under Order 52 rule 7(2) raised at least one arguable issue.
Order 52 rule 7(2) requires that, save for special reasons to be recorded by the Judge, the first order must be that the advocate honour his undertaking within a fixed time, and only thereafter may an enforcement order be made. The learned Judge recorded no special reasons yet entered judgment for Shs.8,770,320/60. That departure from the rule was, in the Court's view, at least one arguable issue supporting the intended appeal.
Validity of a judgment pronounced by the Principal Deputy Registrar
It was arguable that the judgment read and dated by the Principal Deputy Registrar was not yet a judgment of the superior court, since Order 48 does not give Registrars power to read and date a Judge's judgment.
Order 20 rules 2 and 3 permit a Judge to pronounce a judgment written and signed by another Judge, with dating and countersigning in open court by that Judge. Order 48, which gives special powers to Registrars, does not extend to reading and dating a Judge's judgment. The judgment here was delivered by M.J. Bhatt, Principal Deputy Registrar, so its status was arguable.
Whether a binding professional undertaking arose from the correspondence
Whether the letters of 18th May 1993 and 18th October 1994 gave a clear and unequivocal personal undertaking capable of summary enforcement was a matter for argument on appeal.
Applying Cordery on Solicitors, an enforceable undertaking must be personal, clear in its terms, and capable of being performed ab initio, and the summary jurisdiction is exercised only in clear cases. The Court found it arguable whether any binding undertaking could be gleaned from the correspondence, noting the Judge's contrary view would be tested on appeal.
Accord and satisfaction
The bank's acceptance and banking of a cheque sent in full and final settlement, rather than returning it as the rider required, raised an arguable point of accord and satisfaction.
The firm sent Kshs.6,768,797.95 on condition it be accepted in full and final settlement, with a rider that the cheque be returned if not so accepted. The bank instead accepted and banked the cheque on account and without prejudice basis. That conduct was capable of constituting accord and satisfaction and was an arguable point for the intended appeal.
Whether the intended appeal would be rendered nugatory
The balance of convenience favoured the applicant: payment of the full decretal sum would place the law firm in a very tight situation, while the bank would not be affected by being kept out of the sum.
Although the ordinary principle is that a successful appellant before a financially sound respondent suffers no nugatory loss, recent rulings require the Court to weigh the claims of both sides. Here, requiring the law firm to pay the full decretal amount might place it in a very tight situation, whereas the bank would not be affected by being kept out of Shs.10,000,000. Stay was therefore granted.
Legal principles established
#- Under Order 52 rule 7(2), an enforcement order against an advocate may only be made after an order that the advocate honour his undertaking within a fixed time, save for special reasons recorded by the Judge; entry of judgment without recording such reasons is arguable error.
- Order 48 of the Civil Procedure Rules does not confer on Registrars the power to read and date a judgment of a Judge, so a judgment read and dated by a Registrar may not be a judgment of the superior court.
- On the nugatory limb of a stay application, the Court weighs the claims of both sides rather than applying mechanically the principle that a sound respondent can refund.
Court orders
#- 1.Stay of execution of the decree following the judgment of the superior court dated 23rd November 1999 and delivered on 10th December 1999 by the Principal Deputy Registrar
- 2.Costs of the application to be in the intended appeal
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court
- Jurisdiction invoked
- Rules 5(2)(b), 1(2), 92(2) and 43(1) of the Court of Appeal Rules
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.
For these reasons we would allow this application, stay the execution of the decree which follows the judgment of the superior court dated 23rd day of November, 1999 by the learned Judge and delivered on 10th December, 1999 by the Principal Deputy Registrar and order that the costs of this application be in the intended appeal.
save for special reasons to be recorded by the Judge, the order shall in the first instance be that the advocate honour his undertaking within a time fixed by the order, and only thereafter may an order in enforcement be made.
the undertaking must be a personal undertaking and given by the solicitor: It must be clear in its terms: the whole of the undertaking must be before the court; and the undertaking must be one which is capable of being performed ab initio.
Ordinarily that is the principle on which this Court acts but recent rulings of this Court suggest that in dealing with this limb of the application the Court ought to weigh the claims of both sides.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "ORARO & RACHIER ADVOCATES vs CO-OPERATIVE BANK OF KENYA LIMITED [2000] KECA 311 (KLR)", Case Analysis (2000). Civil Application No. Nai. 358 of 1999 (149/99 UR). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2000/311/eng@2000-04-07
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.