Agunga v China Communications Construction Company Limited (Civil Appeal (Application) E218 of 2024) [2026] KECA 636 (KLR)
The bottom line
#Kenya's Court of Appeal varied a consent order so the losing company could secure a Kshs.100 million decree with a different insurer's bond or bank guarantee.
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 Court should allow the variation and/or rescind the consent order dated 3rd March 2025
Key legal issues
#Whether the consent order of 3rd March 2025 requiring an insurance bond from CIC Insurance should be varied or rescinded
The Court varied the consent order, allowing the respondent to furnish security by way of an insurance bond from any reputable insurance company other than CIC, or in the alternative a bank guarantee, within 30 days, failing which the applicant may execute.
The Court noted settled law that a consent binds the parties and may only be impeached on grounds such as fraud or collusion. However, CIC Insurance had confirmed by email that it does not offer the bond in question, making performance impossible. Both parties bore responsibility: the respondent failed to seek variation in good faith, while the applicant did not move to execute. Balancing the scales, the Court varied the terms rather than rescinding the stay outright, and preserved the applicant's right to execute on continued default.
Legal principles established
#- A consent order takes the nature of a judgment or order of the court and binds the parties who entered into it, and can only be set aside on grounds that would justify setting aside a contract, such as fraud, collusion or an agreement contrary to the policy of the court.
- A consent judgment or order has contractual effect and can only be set aside on grounds which would justify setting a contract aside, or if certain conditions remain to be fulfilled which are not carried out.
- An order made on an application to the Court may be varied or rescinded by the Court under rule 59 of the Court of Appeal Rules, 2022, including where the person on whose application an order permitting the doing of some act was made has failed to show reasonable diligence.
Court orders
#- 1.The respondent do offer an insurance bond equal to the decretal sum from any other reputable insurance company acceptable to both parties other than CIC
- 2.In the alternative, the respondent do execute a bank guarantee equal to the decretal sum from a reputable bank acceptable by both parties
- 3.The respondent do comply with either of the orders above within 30 days of the Ruling failing to which the applicant shall be at liberty to execute
- 4.The costs of the application shall abide the outcome of the appeal
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court
- Mombasa HCCOMM No. E002 of 2021
- Jurisdiction invoked
- Rule 59 of the Court of Appeal Rules, 2022
Relief refused
#Rescission/discharge of the consent order and immediate payment of the decretal sum as sought by the applicant
The Court instead varied the consent to allow security from an alternative insurer or bank guarantee, balancing the interests of both parties
Costs
The costs of the application shall abide the outcome of 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.
The respondent do comply with either of the orders ((i) or (ii)) above within 30 days of this Ruling failure to which the respondent shall be at liberty to execute.
It is settled law that a consent takes the nature of a judgement or order of a court, and it binds the parties who entered into it.
To impeach a consent order or a consent judgment, it must be shown that it was obtained by fraud, or collusion or by an agreement contrary to the policy of Court.
a consent judgement or order has contractual efiect and can only be set aside on grounds which would justify setting a contract aside, or if certain conditions remain to be fulfilled, which are not carried out
Finally, we order that the costs of the application shall abide the outcome of the appeal.
Issues in the judgment
#The applicant's affidavit asserts the respondent's financial statements showed a profit of 'Kenya Shillings Seven Hundred Billion', an implausible figure as recorded in the judgment.
The judgment records the stay order as requiring an insurance bond from CIC Insurance within 14 days, but the quoted consent text in the record refers to securing 'the decretal amount' in one rendering and 'the decretal sum' in another.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Agunga v China Communications Construction Company Limited (Civil Appeal (Application) E218 of 2024) [2026] KECA 636 (KLR)", Case Analysis (2026). Application dated 7th July 2025 (applicant is respondent in the main appeal). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2026/636/eng@2026-03-25
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.