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Court of AppealDismissedNotice of Motion dated 7th April 2026 (Court of Appeal, Eldoret)· [2026] KECA 1556 (KLR)

Gilgil Treatment Industries Limited v Bank of India & 1 other

Court of Appeal of Kenya
31 July 2026
2,501 words in judgment
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The bottom line

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Kenya's Court of Appeal refused to block the sale of Gilgil Treatment Industries' properties, ruling the bank can compensate the company if its appeal succeeds.

What this practically means

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Executive summary

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This is a ruling of the Court of Appeal at Eldoret (Gachoka, Korir and Ndolo, JJA) on a Notice of Motion dated 7th April 2026 brought under rule 5(2)(b) of the Court of Appeal Rules, 2022. Gilgil Treatment Industries Limited sought orders restraining Bank of India and an auctioneer from selling or dealing with charged properties (L.R. Nos. Eldoret Municipality Blocks 9/2501, 9/2502 and 9/2522) pending an intended appeal against a High Court ruling of 19th March 2026 (E. Ominde, J) dismissing the applicant's injunction application. The applicant argued the statutory notices under sections 90(2) and 96(2) of the Land Act were non-compliant and that the sale would extinguish its equity of redemption. The respondents countered that the notices were valid, the indebtedness was undisputed, and any loss was compensable in damages, and further alleged abuse of process through multiplicity of proceedings. Applying the settled twin test, the Court found the intended appeal arguable - a single bona fide ground suffices and the threshold is low - but held the appeal would not be rendered nugatory: the properties were voluntarily offered as security, counsel conceded the applicant owed the bank money, and the respondent, a licensed financial institution, was capable of paying damages if the appeal succeeded. The Court declined to determine the abuse-of-process allegation as unnecessary. The motion was dismissed with costs to the respondents. This is an interlocutory ruling exercising original jurisdiction under rule 5(2)(b); it is not an appeal on the merits and does not disturb the High Court's decision.

Key legal issues

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01

Arguability of the intended appeal

Holding

The intended appeal was arguable because it raised non-frivolous questions on the validity of statutory notices under sections 90 and 96 of the Land Act and the application of interlocutory injunction principles

Reasoning

The Court applied the settled low threshold: an arguable appeal is not one that must succeed but one that is not frivolous and deserves fuller consideration. The Court declined to assess the grounds against the High Court ruling, holding that this duty lies with the bench that will hear the intended appeal; its task at the rule 5(2)(b) stage is only to determine whether the issues raised are not frivolous.

p. 4
02

Whether the appeal would be rendered nugatory

Holding

The appeal would not be rendered nugatory: the properties are charged securities, the applicant conceded indebtedness, and the respondent bank can compensate in damages

Reasoning

Relying on Shah v Diamond Trust Bank and Muga Developers, the Court held that where the value of charged property is determinable and the chargee is a reputable financial institution capable of paying damages, exercise of the statutory power of sale does not render a successful appeal nugatory. Counsel for the applicant conceded the applicant owed the respondent money, and the applicant did not rebut the respondents' arguments on compensability.

p. 5
03

Abuse of process through multiplicity of proceedings

Holding

The Court declined to determine the abuse-of-process allegation as it was unnecessary once the twin test failed

Reasoning

The respondents alleged that the applicant and proxies had filed multiple applications and suits over the same matter. Having found the application failed on the rule 5(2)(b) threshold, the Court expressly declined to decide the abuse question, leaving it open. The applicant had argued that exercising a lawful right of appeal cannot, without more, constitute abuse of process.

p. 5

Legal principles established

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  • An applicant under rule 5(2)(b) must satisfy the twin test: an arguable appeal and that the appeal will be rendered nugatory absent stay
  • An arguable appeal need not succeed; it is sufficient that a single bona fide arguable ground is raised
  • Where charged property is the subject of the application and the chargee is a reputable financial institution able to pay damages, an intended appeal is not rendered nugatory by exercise of the statutory power of sale

Court orders

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  1. 1.The notice of motion dated 7th April 2026 is dismissed with costs to the respondents
On appeal from
High Court of Kenya
Jurisdiction invoked
Rule 5(2)(b) of the Court of Appeal Rules, 2022

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, "Gilgil Treatment Industries Limited v Bank of India & 1 other", Case Analysis (2026). Notice of Motion dated 7th April 2026 (Court of Appeal, Eldoret). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1556/eng@2026-07-31

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