Dream Camp Kenya Limited v Mohamed Eltaff, Saga Safaris Limited, Saga Travel and Safaris A.B. & Tour Africa Safaris Limited
The bottom line
#Kenya's Court of Appeal ruled that shares ordered to be sold in a judgment are valued as at the judgment date, not the later valuation date.
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 order that the effective date to fix the fair market value of the 1st respondent's shareholding is the date of valuation constituted a wrong exercise of judicial discretion by the High Court
Key legal issues
#Effective date for valuation of shares ordered to be sold under a judgment
The effective date is the date of the judgment ordering relinquishment of the shares, not the date of the valuation exercise.
The judgment of 28th July 2000 ordered the 1st respondent to relinquish his 10% shareholding and transfer it to the remaining shareholders. That order took effect upon pronouncement of the judgment. It follows that the value of the shareholding to be relinquished must be ascertained by reference to the date of relinquishment, not a later valuation date. The High Court erred in postponing the effective date.
Limits on a judge's power to correct or perfect a judgment via inherent powers
Inherent powers may cure an omission but cannot be used to vary a judgment so as to postpone its effective date.
Mabeya, J sought to perfect the 2000 judgment by fixing the omitted effective date, which was permissible in principle, but in fixing it as the date of valuation he effectively varied the judgment by postponing its operative effect. That exceeded what inherent powers allow, and constituted an error justifying appellate interference with the discretion.
Circumstances for appellate interference with judicial discretion
Interference is warranted where the lower court misdirected itself or arrived at a wrong decision, as occurred here.
Relying on Mbogo v Shah, the Court reiterated the settled principle that it will not interfere with a lower court's discretion unless satisfied the decision is clearly wrong, the court misdirected itself, acted on improper matters, or failed to consider relevant matters and reached a wrong conclusion. Having found error, the Court was entitled to interfere.
Legal principles established
#- An appellate court will not interfere with the exercise of discretion by a lower court unless satisfied the decision is clearly wrong, that the court misdirected itself, acted on wrong matters, or failed to consider relevant matters and arrived at a wrong conclusion.
- Where a judgment orders a shareholder to relinquish and transfer shares, that order takes effect on pronouncement of the judgment, and the value of the shares must be ascertained as at that date, not a later date of valuation.
- A judge cannot, even invoking inherent powers, vary a judgment so as to postpone its effective date.
Court orders
#- 1.Appeal allowed to the extent that the part of the ruling of 11th November 2011 declaring that the effective date to fix the fair market value is the date of valuation is set aside
- 2.Substituted order that the effective date to fix the fair market value is the date of judgment, namely, 28th July 2000
- 3.Each party to bear its own costs of the appeal
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court of Kenya, Commercial & Tax Division, Milimani, Nairobi
- H.C.C.S. No. 450 of 1999
- Jurisdiction invoked
- First appellate jurisdiction under the Constitution and the Civil Procedure Act over appeals from the High Court
Relief refused
#Review of the order of 12th June 2009 (as sought before the High Court)
The High Court declined the review motion, holding that a review of an order made on an application for review was not maintainable; the Court of Appeal did not disturb that refusal
Costs
Each party shall bear its own costs of the appeal.
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.
We substitute therefore an order that the effective date to fix the fair market value is the date of judgment, namely, 28th July 2000.
the value of the 10% shareholding that was to be relinquished should be ascertained with reference to the date on which relinquishment was ordered and not at a later date
it was not open to the Judge to vary the judgment so as to postpone the effective date of the judgment. By doing that, we think the Judge fell into error.
Each party shall bear its own costs of the appeal.
Issues in the judgment
#Conflicting dates for the Kasanga Mulwa judgment within the judgment
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Dream Camp Kenya Limited v Mohamed Eltaff, Saga Safaris Limited, Saga Travel and Safaris A.B. & Tour Africa Safaris Limited", Case Analysis (2018). Civil Appeal No. 175 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2018/879/eng@2018-01-19
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.