Cooperative Bank of Kenya Limited v Catherine Kanini Kioko & 2 others
The bottom line
#Kenya's Court of Appeal kept a property injunction in place but demanded real security — a Kshs.3.5 million bank guarantee — ruling that written undertakings are practically worthless.
What this practically means
#Executive summary
#Key legal issues
#Interference with discretionary interlocutory decisions on appeal
The appeal against discretion fails absent misdirection or clear wrongness; the ELC Judge's decision to preserve the suit property was not faulted.
Applying the Mbogo v Shah principles, the Court found the Judge correctly found a prima facie case, properly resorted to balance of convenience when irreparable loss was doubtful, and preserved the property to avoid rendering the suit moot. No extraneous matters or misdirection were identified, so the injunction could not be vacated entirely.
Sequential application of the Giella v Cassman Brown principles
The three principles are sequential, but balance of convenience is only invoked when the court is in doubt whether the first two limbs are proved.
Following Nguruman, the Court held the principles are sequential, but clarified that the third limb arises only 'when in doubt'. Here doubt existed as to irreparable harm, which justified the Judge falling on balance of convenience. Failure to submit on the second limb was not fatal given the undisputed extensive developments on the property.
Adequacy of the security for the injunction
A written undertaking as to damages is inadequate enforcement value; the Judge's substitution of a written undertaking for the bank guarantee the appellant requested warranted interference.
The Judge accepted the appellant's offer conditional on a Kshs.7 million bank guarantee but ordered only a written undertaking. The Court held such a paper 'is only as good as the paper it was written on' and vacated that part, substituting a bank guarantee of Kshs.3,500,000 or a deposit in a joint interest-earning account within 60 days, failing which the injunction lapses.
Limits of an appeal against an interlocutory order
An appellate court on an interlocutory appeal must eschew final determinations that might embarrass the trial court.
Issues of service of statutory notices, retroactive application of the Land Act, registration of ownership and fraud remain for trial before the ELC. The Court confined itself to the exercise of discretion and declined to pronounce on the substantive issues raised in the appeal.
Legal principles established
#- An appellate court will not interfere with the exercise of discretion by a judge unless the judge misdirected himself on some matter and arrived at a wrong decision, or it is manifest from the case as a whole that the judge was clearly wrong in the exercise of discretion resulting in injustice
- The third Giella principle of balance of convenience arises only where the court is in doubt as to whether the first two principles have been established; where the first two are crystal clear it does not arise
- Failure by a party to submit on the second limb of the injunction principles should not necessarily be held against them where the material before the court supports preservation of the property
- An interlocutory injunction may issue to preserve the status quo where there is a substantial question to be investigated
Court orders
#- 1.The order of injunction granted by the ELC is not vacated and remains in force
- 2.The part of the order requiring the respondents to provide a written undertaking as to damages is vacated
- 3.Substituted order: the respondents deposit a bank guarantee for Ksh.3,500,000 or, in the alternative, deposit Ksh.3,500,000 in an interest-earning joint bank account in the names of counsel for the appellant and the 1st and 2nd respondents within 60 days, failing which the injunction automatically lapses
- 4.Each party to bear its own costs of the appeal
- On appeal from
- Environment and Land Court at Mombasa
- E.L.C No. 159 of 2016
- Jurisdiction invoked
- First appeal against exercise of discretion of the Environment and Land Court (appellate jurisdiction of the Court of Appeal)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Cooperative Bank of Kenya Limited v Catherine Kanini Kioko & 2 others", Case Analysis (2018). Civil Appeal No. 92 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2018/387/eng@2018-07-12
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.