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Court of AppealAllowedCivil Application (not stated in judgment; Notice of Motion dated 6th November 2024)

Absa Bank Kenya Plc v Mwangi (Civil Appeal (Application) E207 of 2024) [2025] KECA 809 (KLR)

Court of Appeal of Kenya
9 May 2025
1,813 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~7 min to read original · ~4 min brief

The bottom line

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Kenya's Court of Appeal paused collection of an employment award against Absa Bank because the winner couldn't prove he could refund the money if the appeal succeeded.

What this practically means

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Executive summary

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The applicant, Absa Bank Kenya PLC, moved the Court of Appeal at Mombasa under rule 5(2)(b) of the Court of Appeal Rules, 2022 for stay of execution of a judgment of the ELRC at Mombasa (M. Mbaru, J.) awarding the respondent, Thomas Macharia Mwangi, Kshs. 8,320,512 in general damages, unpaid bonuses, notice pay and unpaid salary increments, plus a declaration that his constitutional right to privacy had been breached. The respondent opposed, arguing the application was moot because the applicant had paid Kshs. 6,091,558/40 (offset against a loan facility), leaving Kshs. 2,228,953/60 outstanding, and that he could refund the balance if the appeal succeeded. Applying the settled twin principles from Stanley Kang'ethe Kinyanjui v Tony Ketter, the Court found the intended appeal arguable - the grounds, including lack of jurisdiction over an unpleaded defamation claim, were not frivolous, and even a single bona fide ground suffices. On the nugatory limb, the Court held the respondent bore the evidential burden, once a reasonable fear of non-repayment was expressed, to disclose his resources; he failed to do so, and the amount involved being colossal was immaterial. Both limbs being satisfied conjunctively, the Court stayed execution of the ELRC judgment pending the appeal, with costs of the application to abide the outcome of the appeal. The judgment binds subordinate courts to the restated rule 5(2)(b) framework and the burden-shifting rule on refundability of the decretal sum.

Questions the Court framed

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

  1. 1.Whether the intended appeal is arguable under the first limb of the rule 5(2)(b) twin principles
  2. 2.Whether, absent a stay of execution, the intended appeal would be rendered nugatory under the second limb

Key legal issues

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01

Arguability of the intended appeal

Holding

The appeal was arguable; the grounds, including alleged want of jurisdiction over an unpleaded defamation claim, could not be dismissed as frivolous.

Reasoning

The Court applied the settled first limb of the rule 5(2)(b) test, restated in Stanley Kang'ethe Kinyanjui v Tony Ketter, that an arguable appeal is not one that must succeed but one that is not frivolous and ought to be argued fully. The applicant's grounds, including the contention that the trial court lacked jurisdiction over an unpleaded defamation claim, were found bona fide and deserving of the Court's scrutiny, satisfying the first limb.

p. 3
02

Nugatory aspect and burden of proving ability to refund

Holding

The respondent bore the burden of showing he could refund the decretal amount, and having failed to disclose his resources, the second limb was satisfied.

Reasoning

Relying on NIC Bank Ltd v Aquinas Francis Wasike, the Court held that once the applicant expresses a reasonable fear that the respondent cannot repay the decretal sum, the evidential burden shifts to the respondent, being a matter peculiarly within his knowledge. The respondent merely asserted he could repay the outstanding Ksh. 2,228,953/60 but did not disclose what resources he had, so the nugatory limb was met. The Court also held that the size of the sum is immaterial.

p. 3

Legal principles established

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  • An applicant for stay under rule 5(2)(b) must satisfy both twin principles: an arguable appeal and that the appeal would be rendered nugatory absent stay.
  • Even a single bona fide arguable ground of appeal suffices to satisfy the arguability limb.
  • Once an applicant expresses a reasonable fear that a respondent cannot repay the decretal sum, the evidential burden shifts to the respondent to show what resources he has.
  • Substantial loss does not depend on the amount being colossal; what matters is the decree-holder's ability to repay the decretal amount if the appeal succeeds.

Court orders

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  1. 1.Execution of the judgment and decree of the ELRC at Mombasa (M. Mbaru, J.) stayed pending hearing and determination of the applicant's appeal
  2. 2.Costs of the application to abide the outcome of the appeal

The bench

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

majority
majority
On appeal from
Employment and Labour Relations Court at Mombasa
Mombasa ELRC Cause No. E065 of 2023
Jurisdiction invoked
Rule 5(2)(b) of the Court of Appeal Rules, 2022

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

Execution of the judgment and decree of the ELRC at Mombasa (M. Mbaru, J.) dated 1st December 2024 be and is hereby stayed pending hearing and determination of the applicant’s appeal
p. 4Final orders - stay of execution granted
That the costs of the application do abide the outcome of the appeal.
p. 4Costs order
stays or injunctions are not automatic. Rather, they are granted to preserve the integrity of the appellate process so as to render any eventual success a mere pyrrhic victory devoid of substance or succour by reason of intervening loss
p. 2Purpose of stay under rule 5(2)(b)
Once an applicant expresses a reasonable fear that a respondent would be unable to pay back the decretal sum, the evidential burden must then shift to the respondent to show what resources he has since that is a matter which is peculiarly within his knowledge…
p. 3Evidential burden on ability to refund the decretal sum
substantial loss does not have to be a lot of money.
p. 3Substantial loss not measured by the amount involved

Issues in the judgment

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material

The Motion seeks stay of a judgment stated as dated 1st October 2024, but the operative order refers to a judgment dated 1st December 2024 - an internal inconsistency in the date of the decree stayed.

minor

The trial court is described as awarding the respondent damages for breach of privacy, yet the applicant's grounds attack an unpleaded defamation claim; the record before the Court was scanty and did not include the trial proceedings or judgment.

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Absa Bank Kenya Plc v Mwangi (Civil Appeal (Application) E207 of 2024) [2025] KECA 809 (KLR)", Case Analysis (2025). Civil Application (not stated in judgment; Notice of Motion dated 6th November 2024). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2025/809/eng@2025-05-09

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