Job Kilach v Nation Media Group & 2 others [2006] KECA 224 (KLR)
The bottom line
#Kenya's Court of Appeal halted collection of an 11.7 million shilling decree against a guarantor, ruling his appeal was worth hearing because the guarantee's terms were genuinely disputed.
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 intended appeal is arguable
- 2.Whether, unless a stay of execution is granted, the intended appeal will be rendered nugatory
Key legal issues
#Whether the intended appeal against summary judgment was arguable
The appeal was arguable because it was debatable whether the applicant's liability as guarantor was conditional or absolute, given averments in the defence that the guarantee was conditional on a fresh Newspaper Distribution Agreement and was procured by deceit.
The letter of understanding showed the applicant was not the principal debtor; Salaba Agencies Ltd was. The defence pleaded that the guarantee was conditional on the respondent offering a fresh Newspaper Distribution Agreement, which it failed to do, and that the guarantee was obtained by deceit. The court held it was arguable whether the applicant's liability was conditional or absolute, satisfying the first limb of rule 5(2)(b).
Whether the intended appeal would be rendered nugatory without a stay
Yes. The decretal sum was so large that very few individuals could pay it without being overly destabilised, whereas the respondent, a leading media company, could be compensated by interest if the appeal failed.
Applying Oraro & Rachier Advocates v Co-operative Bank of Kenya Limited, the court weighed the claims of both sides. The applicant was an individual guarantor facing a colossal decretal sum; the respondent was a leading media company that would be compensated by an award of interest if the appeal failed. The balance tilted in favour of granting a stay.
Legal principles established
#- To succeed on an application under rule 5(2)(b), an applicant must demonstrate both that the appeal or intended appeal is arguable and that, unless a stay or injunction is granted, the appeal will be rendered nugatory.
- In dealing with the nugatory-aspect limb of a rule 5(2)(b) application involving money decrees, the court ought to weigh the claims of both sides, including the relative ability of the parties to refund or be compensated.
- Under O.XXXV rule 1 of the Civil Procedure Rules, a defendant may show by affidavit 'or otherwise' that he should be granted leave to defend, and 'or otherwise' has been judicially held to include a written statement of defence.
Court orders
#- 1.Stay of execution of the decree in Nairobi HCCC No. 80 of 2003 pending the entering, hearing and determination of the intended appeal, as prayed in prayer (1) of the notice of motion dated 20th June 2005
- 2.Costs shall be in the intended appeal
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court of Kenya at Nairobi, Milimani
- H.C.C.C. No. 80 of 2003
- Jurisdiction invoked
- Rule 5(2)(b) 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.
To succeed, an applicant must show, first, that his appeal or intended appeal is arguable and second, that unless he is granted a stay or an injunction as the case may be, his appeal or intended appeal if successful will be rendered nugatory.
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 claim of both sides.
In the result we allow the application by notice of motion dated 20th June, 2005 as prayed in prayer (1) of the motion. Costs shall be in the intended appeal.
Issues in the judgment
#The judgment refers inconsistently to the date of the letter of understanding, giving 29th November, 2001 in one place and 29th November, 2005 in another.
The judgment appears to confuse the parties when discussing the summary judgment application, stating it was against the '2nd defendant and not the 2nd respondent'.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Job Kilach v Nation Media Group & 2 others [2006] KECA 224 (KLR)", Case Analysis (2006). Civil Application No. 168 of 2005. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2006/224/eng@2006-05-05
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.