Afyare Enterprises Company Limited v Gideon Kiremah Mugambi & 3 others [2019] KECA 301 (KLR)
The bottom line
#Kenya's Court of Appeal blocked any sale or transfer of a disputed Nairobi property pending appeal, but allowed construction on it to continue.
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 the injunction is granted, the appeal, if successful, would be rendered nugatory
- 3.What terms of injunction, if any, are appropriate pending the hearing and determination of the intended appeal
Key legal issues
#Whether the intended appeal is arguable
The intended appeal was arguable because the learned judge made final findings of fact and law at an interlocutory stage, including that the suit property was matrimonial property, that spousal consent was not obtained, that the sale agreement was terminated, and that a court of equal status could not issue an order vacating a High Court order.
The Court reviewed the impugned ruling and the draft grounds of appeal, which assailed the trial judge's findings and alleged breach of court orders, bias, and collusive consent orders. It found the ruling contained final findings on contested matters at interlocutory stage, making the appeal arguable without deciding those contested issues.
Whether the appeal would be rendered nugatory if the injunction is not granted
The Court found the nugatory test satisfied because the suit property is a valuable city property now registered in the name of the 2nd respondent, and it is probable the property may change hands before the appeal is heard, rendering a successful appeal nugatory.
The subject matter is a valuable city property registered in the name of the 2nd respondent. The Court reasoned that preservation was necessary because if the property changed hands before the appeal was determined, a successful appeal would be of no effect. It thus granted a limited injunctive restraint on transfers and dealings.
The appropriate scope of the injunction pending appeal
The Court granted a tailored injunction restraining transfer and registration of dealings in the suit property, but declined to restrain construction or development because of uncertainty whether the construction had been completed.
Balancing the parties' positions, the Court noted the 2nd respondent deposed it had demolished the old premises and built a new shopping centre while the applicant disputed completion. Given the uncertainty, restraining construction was inappropriate, but restraining transfer and dealings would preserve the subject matter of the appeal.
Legal principles established
#- Before the Court can exercise its discretion to grant an order of stay of execution or injunction under Rule 5(2)(b), the applicant must demonstrate that the intended appeal is arguable and that unless the order is granted, the appeal, if it ultimately succeeds, would be rendered nugatory.
- On a Rule 5(2)(b) application, the function of the Court is not to determine contested issues of fact and law, but only to determine whether the intended appeal raises arguable grounds.
Court orders
#- 1.An injunction issued against Max Gas and Logistics Limited (2nd respondent) and the Chief Lands Registrar, Nairobi (3rd respondent) from transferring and/or registering any dealing or from dealing whatsoever in respect of Land Parcel No. 36/VII/403, original number 3018, pending the hearing and determination of the intended appeal
- 2.The notice of motion dated 30th May, 2018 allowed only to that extent
- 3.Costs of the application to be costs in the appeal
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- Environment & Land Court at Nairobi
- E&LC Case No. 1626 of 2016
- Jurisdiction invoked
- Rule 5(2)(b) Court of Appeal Rules - application for injunction pending the hearing and determination of an intended appeal
Relief refused
#Injunction restraining the respondents from undertaking development, construction and/or making improvements to the building on the suit property
There was no certainty that the construction had not been completed; the 2nd respondent deposed that it had demolished the old premises and built a new shopping centre
Injunction against the 1st and 4th respondents restraining them from dealing with the suit property
The injunction granted was confined to the 2nd and 3rd respondents only
Costs
The costs of this application shall be costs in 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.
For the foregoing reasons, the notice of motion dated 30th May, 2018 is allowed to the extent that an injunction is issued against the Max Gas and Logistics Limited (2nd respondent herein) and the Chief Land Registrar, Nairobi (3rd respondent herein) from transferring and/or registering any dealing or from dealing whatsoever in respect of Land Parcel No. 36/VII/403, original number 3018, pending the hearing and determination of the intended appeal.
The costs of this application shall be costs in the appeal. It is so ordered.
The function of this Court in application of this kind is not to determine the contested issues of fact and law. Rather, its function is to determine whether or not the intended appeal or appeal raises arguable grounds fit for consideration of the Court, whatever the outcome would be.
In the absence of certainty that the construction is not completed, it would be inappropriate to grant an injunction stopping construction or use of the suit land.
Issues in the judgment
#The judgment inconsistently records the suit land parcel number, referring variously to LR. No. 36/VII/403 and LR. No. 36/VIII/403
The judgment inconsistently records the number of the matrimonial suit, referring both to Civil Case No. 9 of 2005 (OS) and HCCC No. 9 of 2015 (OS)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Afyare Enterprises Company Limited v Gideon Kiremah Mugambi & 3 others [2019] KECA 301 (KLR)", Case Analysis (2019). Civil Application No. NAI 163 of 2018 (UR 132/2018). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2019/301/eng@2019-10-11
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.