Skip to content
AI-generated case briefs sourced from Kenya Law · Not legal advice
AI-generated case brief
Case Brief · caselaw.co.ke
Court of AppealPartially AllowedCivil Application No. 4 of 2019

Attorney General & another v Phoenix Global Kenya Limited & 5 others [2019] KECA 746 (KLR)

Court of Appeal
15 May 2019
3,666 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~15 min to read original · ~4 min brief

The bottom line

#

Kenya's Court of Appeal halted the release of rice it suspected was substandard, prioritising consumer safety and the state's appeal over an immediate court order.

What this practically means

#

Executive summary

#
This is a single-judgment ruling of a three-judge bench of the Court of Appeal at Mombasa (Visram, Gatembu and Murgor, JJ.A) on a notice of motion dated 20th February 2019 by the Attorney General and the Director of Criminal Investigations, brought under Sections 3 and 3A of the Appellate Jurisdiction Act and Rules 5(2)(b) and 47 of the Court of Appeal Rules. The applicants sought stay of proceedings in Mombasa High Court Constitutional Petition No. 205 of 2018 (Ogola, J), which had ordered release of Phoenix Global Kenya Limited's rice consignment held at Mitchel Cotts (K) Limited's warehouse and awarded the company general damages of Kshs.15,000,000 against the Kenya Bureau of Standards. The applicants intended to appeal, contending the rice was substandard and its release would violate consumer rights under Article 46 and render the appeal nugatory. Applying the settled Rule 5(2)(b) tests - arguability and nugatory value - plus public interest per the Supreme Court's Munya decision, the Court found the intended appeal arguable (unconditional release of the rice, the broken-kernel findings and the damages award were all contestable) and held that release of the rice as grade one before the appeal would be irreversible since it would be sold to unsuspecting consumers. Declining to impose the conditions proposed by the 1st respondent because the parties' consent permitting downgrade was under protest and without prejudice, the Court allowed the application in terms of prayer 3, staying the High Court proceedings, conditional on filing the record of appeal within 14 days failing which the stay lapses, fixing the appeal for priority hearing in June 2019, with costs of the application to abide the outcome of the intended appeal.

Questions the Court framed

#

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

  1. 1.Whether the intended appeal is arguable
  2. 2.Whether, if stay is refused, the intended appeal, if successful, will be rendered nugatory
  3. 3.Whether public interest is a relevant consideration in the grant of stay of proceedings pending appeal

Key legal issues

#
01

Whether the intended appeal is arguable

Holding

The Court held the intended appeal was not frivolous, pointing to questions on the unconditional release of rice allegedly not meeting Grade 1 standards, the treatment of broken rice kernels in samples, and the quantum of damages awarded.

Reasoning

The Court stressed it must be cautious not to predetermine matters for the appeal court, but on the draft memorandum of appeal it identified at least three arguable issues: the direction for unconditional release of rice said not to meet Grade 1 standards; the finding that variation in the percentage of broken rice kernels was negligible; and the award of damages. These, it held, merit consideration by the appeal court.

p. 4
02

Whether the appeal would be rendered nugatory if stay was refused

Holding

The Court held that release of the rice as grade one rice before determination of the appeal would be irreversible and would defeat the object of the intended appeal, since the rice would have been sold to unsuspecting consumers.

Reasoning

Applying the test in Stanley Kangethe Kinyanjui v Tony Ketter on reversibility, the Court found the main bone of contention was the quality and grade of the rice. If released as grade one rice and sold to the public before the appeal was heard, that could not be reversed should the appeal succeed. Weighing this against the 1st respondent's shelf-life and loss concerns, and the 6th respondent's sealing losses, the Court found merit in the application.

p. 4
03

Whether the stay should issue subject to conditions proposed by the respondents

Holding

The Court declined to attach the conditions suggested by counsel for the 1st respondent to the stay order.

Reasoning

Because the parties' consent of 2nd April 2019, allowing the 1st respondent to apply to downgrade the rice, was expressly made under protest and without prejudice, and because subsequent developments were premised on that consent, the Court held it could not impose the suggested conditions without prejudicing one or other of the parties. It therefore granted stay simpliciter, conditioned only on timely filing of the appeal.

p. 4

Legal principles established

#
  • An applicant for stay under Rule 5(2)(b) must demonstrate that the intended appeal is arguable and that, if the order for stay is refused and the appeal succeeds, it will be rendered nugatory; public interest is also a relevant consideration
  • The nugatory test asks whether what is sought to be stayed is reversible or, if not reversible, whether damages will reasonably compensate the aggrieved party
  • Public interest is a relevant consideration in applications under Rule 5(2)(b)

Court orders

#
  1. 1.Proceedings in Mombasa High Court Petition No. 205 of 2018 stayed pending the hearing and determination of the applicants' intended appeal (prayer 3 of the application)
  2. 2.The applicants shall file and serve the memorandum and record of appeal within 14 days from the date of delivery of the Ruling, failing which the order for stay shall lapse without further ado
  3. 3.Once filed, the applicants' appeal shall be fixed for hearing on basis of priority to be heard during the month of June 2019
  4. 4.The costs of the application shall abide by the outcome of the intended appeal

The bench

#

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

majority
majority
majority
On appeal from
High Court of Kenya at Mombasa
Constitutional Petition No. 205 of 2018
Jurisdiction invoked
Sections 3 & 3A of the Appellate Jurisdiction Act and Rules 5(2)(b) & 47 of the Court of Appeal Rules

Relief refused

#

Imposition of the conditions suggested by counsel for the 1st respondent (downgrading of the rice within 14 days, opening of the 6th respondent's go-downs and unfettered access to the rice) as terms of the stay

The consent allowing downgrade was made under protest and without prejudice, with rights reserved; imposing conditions risked prejudicing the parties

p. 4

Costs

The costs of the application shall abide by the outcome of the intended 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.

An applicant is required to demonstrate that the intended appeal is arguable and that if the order for stay is refused, the appeal, if successful will be rendered nugatory.
p. 4Prerequisites for relief under Rule 5(2)(b)
Whether or not an appeal will be rendered nugatory depends on whether or not what is sought to be stayed if allowed to happen is reversible; or if it is not reversible whether damages will reasonably compensate the party aggrieved.
p. 4Nugatory value test
The orders that commend themselves and which we hereby make is to allow the applicant’s application in terms of prayer 3 with the result that proceedings in Mombasa High Court Petition No. 205 of 2018 are hereby stayed pending the hearing and determination of the applicants’ intended appeal
p. 4Final orders - stay granted
on condition that the applicants shall file and serve the memorandum and record of appeal within 14 days from the date of delivery of this Ruling failing which the order for stay of proceedings granted herein shall lapse without further ado.
p. 4Conditional stay - filing deadline
The costs of the application shall abide by the outcome of the intended appeal.
p. 4Costs order

Key timeline

#

Practical implications

#

Frequently asked questions

#

Cite this brief

#

Cite this brief

Caselaw, "Attorney General & another v Phoenix Global Kenya Limited & 5 others [2019] KECA 746 (KLR)", Case Analysis (2019). Civil Application No. 4 of 2019. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2019/746/eng@2019-05-15

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