Equip Agencies Limited & 3 others v Diamond Trust Bank Limited & another (Civil Application E579 of 2023) [2024] KECA 3 (KLR)
The bottom line
#Kenya's Court of Appeal refused to stop the sale of charged properties because an arguable appeal alone is not enough — the appeal must also become worthless without an injunction.
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, if the appeal succeeds, it would be rendered nugatory unless the injunction is granted pending appeal
Key legal issues
#Arguability of the intended appeal
The draft grounds of appeal, including the contention that the superior court misapprehended res judicata and erred in upholding the Deed of Settlement, were arguable
The court applied the settled rule 5(2)(b) threshold, holding that an arguable ground need not be one that would succeed; it suffices that it deserves consideration by the court. The grounds concerning res judicata and the Deed of Settlement met that threshold.
Whether the appeal would be rendered nugatory absent injunctive relief
The appeal would not be rendered nugatory because damages would be an adequate remedy; the applicants voluntarily charged the properties and the 1st respondent bank can compensate them
The court held that the applicants willingly offered the suit properties as security with full knowledge they could be sold on default. As the 1st respondent is a reputable bank able to compensate, damages are an adequate remedy, so the nugatory limb fails. Since both twin principles must be satisfied, the application is dismissed with costs.
Legal principles established
#- An applicant under rule 5(2)(b) must establish both that the appeal is arguable and that it will be rendered nugatory if the orders are not granted; satisfaction of only one limb is fatal to the application
- An arguable ground is not one that must succeed, but one deserving of consideration by the court
Court orders
#- 1.The applicants' notice of motion application is dismissed
- 2.Costs of the application awarded to the 1st respondent
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court (superior court)
- Jurisdiction invoked
- Rule 5(2)(b) of the Court of Appeal Rules
Relief refused
#Injunction restraining the respondents from selling or interfering with the suit properties pending appeal
Though the appeal was arguable, the nugatory-prong was not satisfied: damages from the reputable 1st respondent bank would be an adequate remedy, and both twin principles must be satisfied
Costs
The applicants' notice of motion application is dismissed with costs to the 1st respondent.
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.
The applicants are required to show that their appeal is arguable, and that unless the injunctive reliefs sought are not granted, the applicant's intended appeal, if successful, will be rendered nugatory.
An arguable ground is not necessarily one that must succeed, but merely one that is deserving of consideration by the court.
The upshot therefore is that the applicants' notice of motion application is dismissed with costs to the 1st respondent.
Issues in the judgment
#Typographical error in the judgment text ('ofiered' for 'offered') and the case number/neutral citation do not appear on the copy provided
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Equip Agencies Limited & 3 others v Diamond Trust Bank Limited & another (Civil Application E579 of 2023) [2024] KECA 3 (KLR)", Case Analysis (2024). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2024/3/eng@2024-01-19
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.