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Court of AppealAllowedCivil Appli 32 of 2006

Mua Park Investments Limited v Kenya National Assurance Company Limited (In Liquidation)

Court of Appeal of Kenya
5 May 2006
EGE. M. GithinjiJOJ. W. Onyango OtienoWDW. S. Deverell
1,479 words in judgment
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The bottom line

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Kenya's Court of Appeal stopped the sale of a Nairobi property because an appeal over a time-barred claim was arguable and selling it would make the appeal pointless.

What this practically means

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Executive summary

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This is a ruling of a three-judge bench of the Court of Appeal at Nairobi on a Notice of Motion dated 2nd February 2006 by Mua Park Investments Limited seeking an injunction pending an intended appeal against a ruling of Mary Kasango J delivered on 16th November 2005 in H.C.C.C. No. 355 of 2005. The High Court had dismissed the applicant's suit as an abuse of process for infringing the limitation period under the Limitation of Actions Act (Cap. 22), in a suit against Kenya National Assurance Company Limited (in liquidation) concerning land known as L.R. No. 209/11214, Imara Daima, Nairobi, which the respondent proposed to sell in exercise of a statutory power of sale. Applying the settled two-limb test for injunctions pending appeal - arguability and whether the appeal would be rendered nugatory - the court found a prima facie arguable issue in the draft memorandum challenging the judge's treatment of limitation under sections 4 and 7 of Cap. 22. On the second limb, the respondent's stated intention to enforce its rights by sale, coupled with the absence of any suggestion it could meet a damages claim, created a real risk that a successful appeal would be rendered nugatory. The application was allowed; the respondent was restrained from advertising, selling, transferring or otherwise alienating the suit land pending the intended appeal, with costs of the application in the appeal. The High Court ruling itself was not disturbed at this interlocutory stage.

Questions the Court framed

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

  1. 1.Whether the intended appeal is arguable (not frivolous)
  2. 2.Whether, if the injunction is not granted and the appeal succeeds, the appeal would be rendered nugatory

Key legal issues

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01

Arguability of the intended appeal

Holding

The court found, tentatively and for interlocutory purposes, that paragraph 1 of the draft memorandum raised a prima facie arguable issue on limitation, sufficient to grant the application.

Reasoning

The draft memorandum challenged the judge's holding that the plaintiff's claim offended sections 4 and 7 of the Limitation of Actions Act. The court treated one arguable ground as enough, expressly declining to comment on the other grounds in the memorandum.

p. 3
02

Nugatory value of a successful appeal

Holding

Because the respondent indicated it would enforce its statutory power of sale if no injunction issued, and there was no suggestion it could meet a claim in damages, a successful appeal would be rendered nugatory.

Reasoning

Counsel for the respondent submitted the respondent wished to enforce its rights by sale after many years. The court found a real risk that sale of the suit land would defeat the appeal, given the respondent's apparent inability to pay damages.

p. 3

Legal principles established

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  • On an application for an injunction pending appeal, the court must first consider whether the intended appeal is arguable, and if so, whether the appeal would be rendered nugatory if the injunction is not granted.
  • A single arguable issue in the draft memorandum of appeal suffices to satisfy the arguability threshold.

Court orders

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  1. 1.An injunction restraining the respondent, its officers or agents from advertising, offering for sale, selling, transferring or effecting a change of registration over or otherwise disposing of or alienating L.R. Number 209/11214 within Nairobi pending the hearing and final determination of the intended appeal
  2. 2.Costs of the application to be in the appeal

The bench

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

EG
majority
JO
majority
WD
majority
On appeal from
High Court of Kenya at Nairobi, Milimani Commercial Courts
H.C.C.C. No. 355 of 2005
Jurisdiction invoked
Rules 5(2)(b), 42 and 47 of the Court of Appeal Rules (injunction pending intended appeal)

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.

It has been decided many times by this Court that in deciding whether or not to grant an application for an injunction pending the hearing and determination of an appeal the Court needs first to consider whether the intended appeal is arguable, or in other words not frivolous.
p. 2Test for injunction pending appeal - arguability
If the appeal is arguable the Court then needs to consider whether, if the injunction sought is not granted and the appeal is eventually allowed, that successful appeal would be rendered nugatory as a result of the lack of an injunction.
p. 2Test for injunction pending appeal - nugatory factor
That this Honourable Court hereby grants an injunction restraining the Respondent by itself, its officers or agents from advertising offering for sale, selling, transferring or effecting a change of registration over or otherwise howsoever disposing of or alienating ALL THAT parcel of land known as L.R. Number 209/11214 within Nairobi pending the hearing and final determination of the intended appeal herein.
p. 3Final orders - injunction granted
That the costs of this application be in the appeal.
p. 3Final orders - costs

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, "Mua Park Investments Limited v Kenya National Assurance Company Limited (In Liquidation)", Case Analysis (2006). Civil Appli 32 of 2006. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2006/260/eng@2006-05-05

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