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Court of AppealDismissedCivil Application No. NAI. 64 of 2001 (37/2001 UR)

Spares and Industries Limited v Fina Bank Limited [2001] KECA 220 (KLR)

Court of Appeal
30 March 2001
ALA.A. LakhaSBS.E.O. BosireEOE. Owuor
449 words in judgment
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The bottom line

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Kenya's Court of Appeal refused to pause a High Court case because the company had enough time to appeal before trial started.

What this practically means

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Executive summary

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This is a ruling of the Court of Appeal at Nairobi (Lakha, Bosire and Owuor, JJ.A) on an application by Spares and Industries Limited under rule 5(2)(b) of the Court of Appeal Rules seeking a stay of proceedings in High Court Civil Suit No. 2106 of 1999 pending an intended appeal against an order of Khamoni, J dated 26 February 2001. The order below had dismissed the applicant's application for leave to join two other parties as defendants and to amend its plaint to plead particulars of losses and damages allegedly arising from mismanagement of the applicant's affairs during a one-year receivership. The Court restated the firmly established principles for stay applications: the applicant must show an arguable appeal and that the appeal would be rendered nugatory if the stay is withheld. The Court held, without much hesitation, that it was not persuaded the intended appeal would be rendered nugatory if the stay was not granted, noting counsel's assurance of readiness to prosecute the appeal and that the hearing of the suit had already been fixed for September 2001, which afforded the applicant more than sufficient time to pursue the appeal. The Court expressly declined to express any view on whether the intended appeal was arguable, as the application failed on the nugatory-ness limb. The application was dismissed with costs. The decision below was not disturbed, as the ruling dealt only with the stay application.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether a stay of proceedings of the High Court suit should be granted pending the hearing and determination of an intended appeal
  2. 2.Whether the intended appeal would be rendered nugatory if the stay is not granted

Key legal issues

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01

The principles governing the grant of a stay of proceedings pending appeal under rule 5(2)(b)

Holding

The established principles require the applicant to demonstrate an arguable appeal and that it would be rendered nugatory without a stay; the nugatory limb must be satisfied for the stay to issue

Reasoning

The Court restated the firmly established twin principles for rule 5(2)(b) applications. It declined to determine arguability because the application failed on the nugatory-ness limb: counsel's assurance of readiness to prosecute the appeal, combined with the suit's hearing already fixed for September 2001, meant the intended appeal would not be rendered nugatory if the stay were withheld.

p. 1
02

Whether the intended appeal would be rendered nugatory if the stay was not granted

Holding

It would not, since the hearing of the suit was fixed for September 2001, affording the applicant ample time to prosecute its intended appeal

Reasoning

The Court weighed the state of the case timetable: the High Court hearing had already been set down for September 2001, and counsel for the applicant assured the Court of readiness to mount the intended appeal. In those circumstances the Court found more than sufficient time existed for the applicant to prosecute its appeal, so no nugatory-ness arose.

p. 2

Legal principles established

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  • An applicant for a stay under rule 5(2)(b) must show that the appeal is arguable and that it would be rendered nugatory if the stay is not granted

Court orders

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  1. 1.The application for stay of proceedings is dismissed with costs

The bench

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One judgment of the whole court — no separate or dissenting opinions.

AL
majority
SB
majority
EO
majority
On appeal from
High Court of Kenya at Nairobi
H.C.C.C No. 2106 of 1999
Jurisdiction invoked
Rule 5(2)(b) of the Court of Appeal Rules

Relief refused

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Stay of proceedings/hearing of High Court Civil Suit Number 2106 of 1999 pending the intended appeal

The Court was not persuaded that the intended appeal would be rendered nugatory if the stay was not granted, and the hearing of the suit was already fixed for September 2001, giving the applicant sufficient time to prosecute its appeal

p. 2

Costs

The application fails and is dismissed with costs (costs to the respondent).

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

The principles upon which this Court grants a stay are now firmly established. They require that the applicant should show that he had an arguable appeal and the same would be rendered nugatory if the stay sought in the application is withh
p. 1Twin principles for stay under rule 5(2)(b)
Having said that, it becomes unnecessary for us to express any view as to whether the intended appeal is arguable. For the above reason, the application fails and is dismissed with costs.
p. 2Final orders - dismissal of the application with costs
we are not persuaded that the intended appeal would indeed be rendered nugatory if a stay is not granted
p. 2Failure of the nugatory-ness limb

Issues in the judgment

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minor

The text of the judgment contains a typographical corruption where the nugatory principle is stated, merging the end of one sentence with the start of the next

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Spares and Industries Limited v Fina Bank Limited [2001] KECA 220 (KLR)", Case Analysis (2001). Civil Application No. NAI. 64 of 2001 (37/2001 UR). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2001/220/eng@2001-03-30

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.