Starryway Trading & Shipping Company Ltd v Et Timbers PTE Limited & another (Civil Appeal E121 of 2022) [2023] KECA 1323 (KLR)
The bottom line
#Kenya's Court of Appeal ruled a shipping company could not use joinder to an admiralty suit to stall proceedings and protect a lien pending foreign arbitration.
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 trial court was justified in declining to join the appellant to the in rem admiralty proceedings as an interested party
- 2.Whether the court proceedings ought to have been stayed pending the arbitration proceedings in London between the appellant and the 1st respondent
- 3.Whether the appellant could exercise a right of lien over the 1st respondent's cargo on board the vessel
- 4.Whether the court should interfere with the exercise of the trial court's discretion
Key legal issues
#Whether the trial judge's discretion in refusing joinder was properly exercised
The appeal fails because the appellant showed no error of law or principle, no irrelevant or ignored considerations, and the decision was not plainly wrong.
The court applied the Supreme Court decision in Apungu Arthur Kibira v IEBC and the stricter criteria for appeals against discretionary decisions drawn from Kacem v Bashir. Joinder is an exercise of discretion and a case management decision; the trial judge correctly identified and applied the three conditions in Dr Donna Molavi v Guy Hibbert and found the second and third conditions unmet. Nothing was placed before the appellate court to fault that exercise.
Conditions for joinder of a party to in rem proceedings
A proposed joinder party with no claim against it in the suit must show its interest had accrued or matured and that the orders sought would legally affect it, or that joinder is desirable to avoid multiplicity of suits.
There was no claim by the 1st respondent against the appellant, nor by the 2nd respondent against the appellant. Citing Departed Asians Property Custodian Board v Jaffer Brothers and Barclays Bank D C O v C B Patel, the court held the appellant had to show a right to relief arising out of the same transaction and a common question of law or fact, or that its presence was necessary for effectual settlement. The appellant's claim against the 1st respondent was in personam and belonged in arbitration, not in the in rem suit.
Joinder as a device to stay proceedings pending arbitration
Joinder cannot be used to stagnate proceedings where the joining party has no claim in the suit; the appellant's object was collateral.
The appellant sought joinder solely to stay the proceedings and protect a lien in aid of the London arbitration, which was in personam against the 1st respondent, while the suit was in rem against the vessel. The court held that such use of joinder achieves collateral purposes and that the effect of joinder would be the stultification of the proceedings rather than the furtherance of the overriding objective.
Legal principles established
#- An appellate court will not interfere with a trial court's exercise of discretion unless an error of law or principle is shown, irrelevant considerations were taken into account, a relevant consideration was ignored, or the decision is plainly wrong.
- In interlocutory appeals an appellate court may only express its views on a prima facie basis and must not conclude the merits so as to tie the hands of the trial judge.
- A party cannot be joined to in rem admiralty proceedings under the guise of joinder in order to obtain relief that ought to be sought in separate in personam proceedings.
- Part 61.8(7) of the Civil Procedure Rules of England must be read together with Part 19.2(2) of the same Rules, which guide the court's discretion on joinder.
Court orders
#- 1.The appeal is dismissed
- 2.The costs of the appeal are awarded to the 1st respondent, to be borne by the appellant
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court of Kenya at Mombasa
- Admiralty Cause No E003 of 2021
- Jurisdiction invoked
- Appeal against an interlocutory decision of the High Court in admiralty proceedings, heard under the Court of Appeal Rules; specific appellate jurisdiction provision not stated in the judgment
Relief refused
#Joinder of the appellant as an interested party to the admiralty proceedings
The appellant had no claim against it in the proceedings and failed to show its presence was necessary for effectual and complete settlement or that its interests would be legally affected; joinder would stultify the proceedings
Stay of the superior court proceedings pending determination of the London arbitration
The appellant sought joinder only to stagnate the proceedings and pursue collateral arbitration purposes; the trial judge's discretion was not shown to have been wrongly exercised
Protection/exercise of the appellant's contractual lien over the 1st respondent's cargo
Since the appellant could not be joined in the proceedings, it could not exercise a right of lien over the cargo on board the vessel
Costs
We award the costs of the appeal to the 1st respondent to be borne by the appellant.
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.
at interlocutory stage the court may only express its views in the matters in controversy on a prima facie basis.
In this case, it is our view that by seeking to be joined to the in rem proceedings in order to secure a decree that it may obtain against the 1st respondent in the arbitration proceedings, the appellant set out, through judicial craft, to achieve collateral purposes not connected with the proceedings which were before the court.
Joinder of parties to proceedings is not meant to assist parties who have claims in other cases to secure their interests in those other cases by stagnating proceedings in the cases in which they seek to join when they have no claim in those claims.
Accordingly, we find no merit in this appeal, which we hereby dismiss. We award the costs of the appeal to the 1st respondent to be borne by the appellant.
Issues in the judgment
#The judgment does not print the names of the parties in the title or coram; the appellant's actual name is never stated, it being referred to only as 'the appellant' (described elsewhere as having been wrongfully described as owners of the vessel, with Fairwind International Shipping Company Limited mentioned as the party with whom negotiations were carried out).
The judgment appears to truncate a sentence regarding submissions on part 61.8(7) of the Civil Procedure Rules of England.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Starryway Trading & Shipping Company Ltd v Et Timbers PTE Limited & another (Civil Appeal E121 of 2022) [2023] KECA 1323 (KLR)", Case Analysis (2023). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2023/1323/eng@2023-11-10
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.