1. The application dated 19th August 2024 is of significant importance as it seeks a stay of execution of this Court’s judgment delivered on 18th July 2024, with costs in the cause, pending appeal to the Court of Appeal. The orders in the said judgment were to be implemented progressively, with those in Malindi ELC 207 of 2015 - Amina Mohamed Kasinga & 22 others v Kikambala Housing Estate Limited 1st Defendant, The Land Registrar, Kilifi County 2nd Defendant and Bank of Africa Kenya Limited Interested Party (the lead file), as consolidated with Malindi ELC 61 of 2015, 227 of 2015, 234 of 2015, 16 of 2016,202 of 2016, 128 of 2018 and 147 of 2018.
2. The application is strongly supported by the annexed affidavit deposed on the even date by one of the applicant Company\'s Directors, Osman Erdinc Elsek, and the compelling grounds set in the application\'s body.
3. The application is met with fierce opposition; there are substantial grounds for opposition as filed and, as evidenced by the replying affidavit deposed by the Recoveries Manager of the respondent Bank, Jacqueline Mureithi, on 23rd August 2024. In ELC 207 of 2015, Amina Mohammed Kasinga deposed a replying affidavit dated 23rd of August 2024 - with the authority of the other applicants.
4. The applicant avers that the judgment delivered on 18th July 2024, if implemented, will occasion irreparable loss to the applicant, who has a constitutional right to appeal this Court\'s decision to the Court of Appeal.
5. Significantly, the applicant states that the substratum of the suit Kilifi/Mtwapa/867 will be altered if this Court\'s decision were to be enforced. The applicant faces the imminent and substantial loss of the property if the bills of costs are taxed and the property is placed at an auction.
6. According to the applicant, it is crucial to note that the Court erred in placing too much emphasis on the Partial Settlement Agreement (PSA) dated 11th June 2024, which was never signed by all the parties in Malindi ELC 2007 of 2015 as consolidated with other suits aforesaid. The PTA did not consider that the other plaintiffs had fully paid purchase monies out of the 125 housing units and would stand prejudiced if the said agreement were to be implemented progressively as pronounced by the Court.
7. The applicant believes that there is an arguable appeal that should be heard on merit. Besides, there are significant pending matters in the High Court Mombasa—HCC No. 2 of 2018, as consolidated with HCC No. 58 of 2018—on the audit of the respondent’s loan advanced to the applicant; therefore, a stay of execution is necessary.
8. On the grounds of opposition dated 23rd of August 2024 and the replying affidavit by Jacqueline Mureithi, the respondent believes that it will benefit all parties in this suit and ELC 207 of 2015 as consolidated if the judgment of this Court were to be implemented. The applicant voluntarily entered the PSA, which was relied on by the Court. It was part of the evidence tendered in this Court. The Court considered it and offered the appropriate road map to settle the matter—the loan of Kshs. 364,000,000/- still stands. The applicant does not oppose the issuance of sub–leases to all the plaintiffs in the consolidated suits. The Court found that the applicant reneged on its obligation to create security dated 28th October 2013 by failing to execute the necessary documents to facilitate the issuance of a leasehold title and subsequent legal charge in favour of the respondent and subleases to the plaintiffs in Malindi ELC 207 of 2015 as consolidated with other suits over the same subject matter. Therefore, implementing the judgment herein will lead to the completion of the process as agreed by the parties.
9. The respondent claims they will suffer more harm than the applicant if no legal charge is registered. This includes the risk of recovering the Kshs 364,000,000/ advanced to the applicant and recovering the current amount of over Kshs. 946,197,288/-. This could substantially impact the respondent\'s financial situation and the applicant\'s capacity to repay the loan.
10. The respondent states that the applicant has not fulfilled the conditions as set in Order 42 Rule (6) of the Civil Procedure Rules – as to security in the fulfillment of the judgment of this Court. The respondent points out that the applicant herein, in Mombasa HCC No. 2 of 2018, consolidated with Mombasa HCC No. 58 of 2018 – has failed to pay costs as directed by the Superior Court (Kizito J.) of Kshs. 30,303,635/- since 2019.
11. In ELC 207 of 2015, as consolidated, Amina Mohammed Kasinga asserts in her replying affidavit deposed on 23rd of August 2024 that the Court has already rendered itself and is functus officio. Throughout the proceedings, the applicant admitted that all the plaintiffs in the consolidated suits had paid the purchase monies and that there were no qualms raised by the applicant about the issuance of the subleases. The applicant admitted being ready and willing to perform its part in issuing the sub-leases. The applicant has failed to comply with the progressive implementation of the orders as proposed by this Court. The plaintiffs in ELC 207 of 2015 have been waiting for their sub-leases for over ten years, with multiple cumbersome suits filed here and in the Superior Court at Mombasa. The applicant has not met the conditions for stay as envisaged in Order 42 Rule (6) of the Civil Procedure Rules. Stay will mean further delay in this matter.
12. Mr. Mogaka, for the plaintiffs in ELC No. 61 of 2015 Lucy Mwihaki Njuguna & 6 others v Kikambala Housing Estate Limited & The Land Registrar, Kilifi County, is of the same view that there is nothing to stay the judgment of this Court here ought to be implemented.
13. The issue that calls for this Court\'s decision here and in ELC No. 207 of 2015 as consolidated, which I frame, is whether to grant a stay pending appeal and corollary to it - who should bear the costs of this application$1
14. Stay pending appeal is granted under the conditions as enumerated in the case of Daniel Mburunga Kiriamburi v Murungi M’ananga [2022] eKLR:
“Expounding on the above principles, the court in RWW vs. EKW (2019) eKLR held the purpose of a stay pending an appeal is to preserve the subject matter in dispute so that the rights of the appellant who is exercising the undoubted right of appeal are safeguarded and the appeal if successful is not rendered nugatory. Further, the court held in doing so, it has to weigh this right against the rights of a successful litigant who should not be deprived of the fruits of his judgment.
3. In other words, the court is called upon to ensure no party suffers prejudice that cannot be compensated by an award of costs.
4. As regards substantial loss, the court in Jeny Luesby vs Standard Group Ltd (2014) eKLR held the commencement of an execution was a lawful process and could not be equated to substantial loss. Further in Butt vs. Rent Restriction Tribunal (1982) KLR 417, the court held power to grant a stay of execution was discretionary, while in National Industrial Credit Bank Ltd vs. Aquinas, Francis Wasike & another (2006) eKLR, the court held the legal duty was on the applicant to prove the allegations that an appeal would be rendered nugatory if the application was not allowed.”
15. This Court, in its judgment dated 18th of July 2024, found as follows:
“Having established that there was a valid agreement between Plaintiff and 1st Defendant and carefully analyzing the facts and evidence placed before this Court, Plaintiff has proved its case and is entitled to the prayers sought in the plaint as follows:
a) A declaration be and is hereby issued that the 1st Defendant’s failure/neglect and refusal to execute the instrument of surrender of the freehold estate in respect to Title No.Kilifi/ Mtwapa/867, as well as the lease regarding the leasehold interest for Kilifi/ Mtwapa/ 867, is in breach of the 1st Defendant’s obligations as contained in the Agreement to Create Security dated 28th October 2013.
b) An order of specific performance be and is hereby issued compelling the 1st Defendant to avail its Directors to the 2nd Defendant at the Kilifi Land Registry in Kilifi Town within 14 days of the date of this judgment and further compelling the 1st Defendant to execute the surrender of the freehold estate in respect to Title No. Kilifi/ Mtwapa/ 867, as well as the lease regarding the leasehold interest for Kilifi/ Mtwapa/ 867, in addition to any other documents as shall be required by the Registrar of Lands Kilifi for purposes of issuance of the leasehold title,
c) In default of compliance with order (b) above, the 2nd Defendant be compelled to transmit the instrument of surrender and the lease concerning Title No. Kilifi/ Mtwapa/867 to the Deputy Registrar of this Court and the Deputy Registrar, in such an event, be and is hereby directed by this Court to execute the said instrument of Surrender and the said Lease on behalf of the 1st Defendant under the seal of this Court in addition to any other documents as shall be required by the Registrar of Lands Kilifi for purposes of issuance of the leasehold title;
d) An order be and is hereby issued compelling the 2nd defendant to make such entries as are necessary to close the freehold register and open the leasehold register and to register the 1st Defendant as the leasehold proprietor of Kilifi/ Mtwapa/867 and contemporaneously with such registration of the instrument of Surrender and the Lease, the 2nd Defendant to issue a Certificate of Lease for Title No. Kilifi/ Mtwapa/867, which shall be retained by the 2nd Defendant after issuance, subject to further orders as set out below:
e) An order of Specific Performance be and is hereby issued compelling the 1st Defendant to execute a legal charge in respect to the leasehold interest in Kilifi/ Mtwapa/867 in favour of the Plaintiff in the format set out in the Agreement to Create Security between the 1st Defendant and the Plaintiff dated 28th October 2013 within 14 days after the issuance of a Certificate of Lease pursuant to Order (d) above;
f) In default of Order (e) above, the Plaintiff be and is hereby ordered to present the legal charge concerning Title No. Kilifi/ Mtwapa/867 in the format set out in the Agreement to Create Security dated 28th October 2013, to the Deputy Registrar of this Court and the Deputy Registrar, in such an event, be and is hereby directed by this Court to execute the said legal charge on behalf of the 1st Defendant under the seal of this Court.
g) The 2nd Defendant be and is hereby directed to register the Plaintiff’s legal charge in the leasehold register for Title No. Kilifi/ Mtwapa/ 867 after execution of the same pursuant to Order (e) or (f) above within three days of presentation for registration subject to the same complying with the requirements of the law and upon the Plaintiff’s due payment of stamp duty and the requisite registry fees and to after that release the duly registered legal charge, the lease and the Certificate of lease to the Plaintiff and the Plaintiff’s duly authorized agent.
h) Pursuant to findings in Malindi ELC 207 2015, the implementation of the orders above is to be simultaneous with the partial settlement agreement dated 11th June 2018.
i) To achieve the preceding, Orders of inhibition placed on land title No.Kilifi/Mtwapa/867 be removed.
j) The 1st Defendant shall bear the costs of this suit.
16. In ELC 207 of 2015, as consolidated, the Court found as follows:
“The Court finds that the Plaintiffs have proved their case against the 1st Defendant. Consequently, the Plaintiffs are entitled to reliefs as follows:
a) Subject to the fulfillment of orders issued in ELC 355 of 2016, an order of Specific Performance be and is hereby issued compelling the 1st Defendant to take steps and facilitate the transfer and registration of the Plaintiffs (in the suits as consolidated) as owners of their specific Housing Units.
b) In default of (a) above, an order be and is hereby issued directing the 1st Defendant to refund the total purchase prices to the Plaintiffs and any other costs incurred by the Plaintiffs to develop and improve their respective Housing Units or as per their respective sale agreements.
c) Costs of this suit and interest at Court rates are to be borne by the 1st Defendant for the Plaintiffs, the 2nd Defendant, and the Interested Party herein.
17. Considering the implementation matrix provided by this Court here and in ELC 207 of 2015 as consolidated, the Court\'s orders will take a long time to implement—they were Solomonic in nature, considering all the parties’ interests in the suit property – that of the respondent here - to recover its loan advanced to the applicant, the respondents in ELC 207 of 2015 as consolidated as purchasers entitled to sub-leases from the applicant who already received their monies and significantly the applicant who is under obligation to repay the loan advanced by the respondent and issue sub-leases to the respondents in ELC 207 of 2015 as consolidated. As of now, the suit property - Kilifi/ Mtwapa/ 867, does not stand to be auctioned yet; the Court provided a road map on how all the parties (including the applicant) were to collectively move towards the final resolution of these otherwise protracted suit(s).
18. I see no substantial loss to the applicant more than the respondents if a stay were not granted. All the parties have an equal stake in the suit property in pari- passu.
19. Considering the right of the applicant to appeal and that of the respondents in this suit and Malindi ELC 207 of 2015 as consolidated, to enjoy the fruits of the judgment(s) in place, and exercising my discretion judiciously - and leaving the arguable test of the intended appeal – to the Court of Appeal – I see nothing to stay pending appeal. The substratum of the suit remains intact, given the progressive nature of the orders of this Court.
20. The upshot is that the application dated 19th August 2024 is hereby dismissed with costs to the respondent. This order binds ELC No.207 of 2015 as consolidated—mutatis mutandis.
Dated, signed, and delivered virtually at Malindi on this 30th day of August 2024.
E. K. MAKORI
JUDGE
In the Presence of:
Dr. Khaminwa SC, for the Applicant
Mr. McCourt SC, for the Respondent
Mr. Ananda, for the Respondents in No.207 of 2015
Mshali: Court Assistant
In the absence of:
Mr. Mogaka, for the Respondents in No.61 of 2015
2. The application is strongly supported by the annexed affidavit deposed on the even date by one of the applicant Company\'s Directors, Osman Erdinc Elsek, and the compelling grounds set in the application\'s body.
3. The application is met with fierce opposition; there are substantial grounds for opposition as filed and, as evidenced by the replying affidavit deposed by the Recoveries Manager of the respondent Bank, Jacqueline Mureithi, on 23rd August 2024. In ELC 207 of 2015, Amina Mohammed Kasinga deposed a replying affidavit dated 23rd of August 2024 - with the authority of the other applicants.
4. The applicant avers that the judgment delivered on 18th July 2024, if implemented, will occasion irreparable loss to the applicant, who has a constitutional right to appeal this Court\'s decision to the Court of Appeal.
5. Significantly, the applicant states that the substratum of the suit Kilifi/Mtwapa/867 will be altered if this Court\'s decision were to be enforced. The applicant faces the imminent and substantial loss of the property if the bills of costs are taxed and the property is placed at an auction.
6. According to the applicant, it is crucial to note that the Court erred in placing too much emphasis on the Partial Settlement Agreement (PSA) dated 11th June 2024, which was never signed by all the parties in Malindi ELC 2007 of 2015 as consolidated with other suits aforesaid. The PTA did not consider that the other plaintiffs had fully paid purchase monies out of the 125 housing units and would stand prejudiced if the said agreement were to be implemented progressively as pronounced by the Court.
7. The applicant believes that there is an arguable appeal that should be heard on merit. Besides, there are significant pending matters in the High Court Mombasa—HCC No. 2 of 2018, as consolidated with HCC No. 58 of 2018—on the audit of the respondent’s loan advanced to the applicant; therefore, a stay of execution is necessary.
8. On the grounds of opposition dated 23rd of August 2024 and the replying affidavit by Jacqueline Mureithi, the respondent believes that it will benefit all parties in this suit and ELC 207 of 2015 as consolidated if the judgment of this Court were to be implemented. The applicant voluntarily entered the PSA, which was relied on by the Court. It was part of the evidence tendered in this Court. The Court considered it and offered the appropriate road map to settle the matter—the loan of Kshs. 364,000,000/- still stands. The applicant does not oppose the issuance of sub–leases to all the plaintiffs in the consolidated suits. The Court found that the applicant reneged on its obligation to create security dated 28th October 2013 by failing to execute the necessary documents to facilitate the issuance of a leasehold title and subsequent legal charge in favour of the respondent and subleases to the plaintiffs in Malindi ELC 207 of 2015 as consolidated with other suits over the same subject matter. Therefore, implementing the judgment herein will lead to the completion of the process as agreed by the parties.
9. The respondent claims they will suffer more harm than the applicant if no legal charge is registered. This includes the risk of recovering the Kshs 364,000,000/ advanced to the applicant and recovering the current amount of over Kshs. 946,197,288/-. This could substantially impact the respondent\'s financial situation and the applicant\'s capacity to repay the loan.
10. The respondent states that the applicant has not fulfilled the conditions as set in Order 42 Rule (6) of the Civil Procedure Rules – as to security in the fulfillment of the judgment of this Court. The respondent points out that the applicant herein, in Mombasa HCC No. 2 of 2018, consolidated with Mombasa HCC No. 58 of 2018 – has failed to pay costs as directed by the Superior Court (Kizito J.) of Kshs. 30,303,635/- since 2019.
11. In ELC 207 of 2015, as consolidated, Amina Mohammed Kasinga asserts in her replying affidavit deposed on 23rd of August 2024 that the Court has already rendered itself and is functus officio. Throughout the proceedings, the applicant admitted that all the plaintiffs in the consolidated suits had paid the purchase monies and that there were no qualms raised by the applicant about the issuance of the subleases. The applicant admitted being ready and willing to perform its part in issuing the sub-leases. The applicant has failed to comply with the progressive implementation of the orders as proposed by this Court. The plaintiffs in ELC 207 of 2015 have been waiting for their sub-leases for over ten years, with multiple cumbersome suits filed here and in the Superior Court at Mombasa. The applicant has not met the conditions for stay as envisaged in Order 42 Rule (6) of the Civil Procedure Rules. Stay will mean further delay in this matter.
12. Mr. Mogaka, for the plaintiffs in ELC No. 61 of 2015 Lucy Mwihaki Njuguna & 6 others v Kikambala Housing Estate Limited & The Land Registrar, Kilifi County, is of the same view that there is nothing to stay the judgment of this Court here ought to be implemented.
13. The issue that calls for this Court\'s decision here and in ELC No. 207 of 2015 as consolidated, which I frame, is whether to grant a stay pending appeal and corollary to it - who should bear the costs of this application$1
14. Stay pending appeal is granted under the conditions as enumerated in the case of Daniel Mburunga Kiriamburi v Murungi M’ananga [2022] eKLR:
“Expounding on the above principles, the court in RWW vs. EKW (2019) eKLR held the purpose of a stay pending an appeal is to preserve the subject matter in dispute so that the rights of the appellant who is exercising the undoubted right of appeal are safeguarded and the appeal if successful is not rendered nugatory. Further, the court held in doing so, it has to weigh this right against the rights of a successful litigant who should not be deprived of the fruits of his judgment.
3. In other words, the court is called upon to ensure no party suffers prejudice that cannot be compensated by an award of costs.
4. As regards substantial loss, the court in Jeny Luesby vs Standard Group Ltd (2014) eKLR held the commencement of an execution was a lawful process and could not be equated to substantial loss. Further in Butt vs. Rent Restriction Tribunal (1982) KLR 417, the court held power to grant a stay of execution was discretionary, while in National Industrial Credit Bank Ltd vs. Aquinas, Francis Wasike & another (2006) eKLR, the court held the legal duty was on the applicant to prove the allegations that an appeal would be rendered nugatory if the application was not allowed.”
15. This Court, in its judgment dated 18th of July 2024, found as follows:
“Having established that there was a valid agreement between Plaintiff and 1st Defendant and carefully analyzing the facts and evidence placed before this Court, Plaintiff has proved its case and is entitled to the prayers sought in the plaint as follows:
a) A declaration be and is hereby issued that the 1st Defendant’s failure/neglect and refusal to execute the instrument of surrender of the freehold estate in respect to Title No.Kilifi/ Mtwapa/867, as well as the lease regarding the leasehold interest for Kilifi/ Mtwapa/ 867, is in breach of the 1st Defendant’s obligations as contained in the Agreement to Create Security dated 28th October 2013.
b) An order of specific performance be and is hereby issued compelling the 1st Defendant to avail its Directors to the 2nd Defendant at the Kilifi Land Registry in Kilifi Town within 14 days of the date of this judgment and further compelling the 1st Defendant to execute the surrender of the freehold estate in respect to Title No. Kilifi/ Mtwapa/ 867, as well as the lease regarding the leasehold interest for Kilifi/ Mtwapa/ 867, in addition to any other documents as shall be required by the Registrar of Lands Kilifi for purposes of issuance of the leasehold title,
c) In default of compliance with order (b) above, the 2nd Defendant be compelled to transmit the instrument of surrender and the lease concerning Title No. Kilifi/ Mtwapa/867 to the Deputy Registrar of this Court and the Deputy Registrar, in such an event, be and is hereby directed by this Court to execute the said instrument of Surrender and the said Lease on behalf of the 1st Defendant under the seal of this Court in addition to any other documents as shall be required by the Registrar of Lands Kilifi for purposes of issuance of the leasehold title;
d) An order be and is hereby issued compelling the 2nd defendant to make such entries as are necessary to close the freehold register and open the leasehold register and to register the 1st Defendant as the leasehold proprietor of Kilifi/ Mtwapa/867 and contemporaneously with such registration of the instrument of Surrender and the Lease, the 2nd Defendant to issue a Certificate of Lease for Title No. Kilifi/ Mtwapa/867, which shall be retained by the 2nd Defendant after issuance, subject to further orders as set out below:
e) An order of Specific Performance be and is hereby issued compelling the 1st Defendant to execute a legal charge in respect to the leasehold interest in Kilifi/ Mtwapa/867 in favour of the Plaintiff in the format set out in the Agreement to Create Security between the 1st Defendant and the Plaintiff dated 28th October 2013 within 14 days after the issuance of a Certificate of Lease pursuant to Order (d) above;
f) In default of Order (e) above, the Plaintiff be and is hereby ordered to present the legal charge concerning Title No. Kilifi/ Mtwapa/867 in the format set out in the Agreement to Create Security dated 28th October 2013, to the Deputy Registrar of this Court and the Deputy Registrar, in such an event, be and is hereby directed by this Court to execute the said legal charge on behalf of the 1st Defendant under the seal of this Court.
g) The 2nd Defendant be and is hereby directed to register the Plaintiff’s legal charge in the leasehold register for Title No. Kilifi/ Mtwapa/ 867 after execution of the same pursuant to Order (e) or (f) above within three days of presentation for registration subject to the same complying with the requirements of the law and upon the Plaintiff’s due payment of stamp duty and the requisite registry fees and to after that release the duly registered legal charge, the lease and the Certificate of lease to the Plaintiff and the Plaintiff’s duly authorized agent.
h) Pursuant to findings in Malindi ELC 207 2015, the implementation of the orders above is to be simultaneous with the partial settlement agreement dated 11th June 2018.
i) To achieve the preceding, Orders of inhibition placed on land title No.Kilifi/Mtwapa/867 be removed.
j) The 1st Defendant shall bear the costs of this suit.
16. In ELC 207 of 2015, as consolidated, the Court found as follows:
“The Court finds that the Plaintiffs have proved their case against the 1st Defendant. Consequently, the Plaintiffs are entitled to reliefs as follows:
a) Subject to the fulfillment of orders issued in ELC 355 of 2016, an order of Specific Performance be and is hereby issued compelling the 1st Defendant to take steps and facilitate the transfer and registration of the Plaintiffs (in the suits as consolidated) as owners of their specific Housing Units.
b) In default of (a) above, an order be and is hereby issued directing the 1st Defendant to refund the total purchase prices to the Plaintiffs and any other costs incurred by the Plaintiffs to develop and improve their respective Housing Units or as per their respective sale agreements.
c) Costs of this suit and interest at Court rates are to be borne by the 1st Defendant for the Plaintiffs, the 2nd Defendant, and the Interested Party herein.
17. Considering the implementation matrix provided by this Court here and in ELC 207 of 2015 as consolidated, the Court\'s orders will take a long time to implement—they were Solomonic in nature, considering all the parties’ interests in the suit property – that of the respondent here - to recover its loan advanced to the applicant, the respondents in ELC 207 of 2015 as consolidated as purchasers entitled to sub-leases from the applicant who already received their monies and significantly the applicant who is under obligation to repay the loan advanced by the respondent and issue sub-leases to the respondents in ELC 207 of 2015 as consolidated. As of now, the suit property - Kilifi/ Mtwapa/ 867, does not stand to be auctioned yet; the Court provided a road map on how all the parties (including the applicant) were to collectively move towards the final resolution of these otherwise protracted suit(s).
18. I see no substantial loss to the applicant more than the respondents if a stay were not granted. All the parties have an equal stake in the suit property in pari- passu.
19. Considering the right of the applicant to appeal and that of the respondents in this suit and Malindi ELC 207 of 2015 as consolidated, to enjoy the fruits of the judgment(s) in place, and exercising my discretion judiciously - and leaving the arguable test of the intended appeal – to the Court of Appeal – I see nothing to stay pending appeal. The substratum of the suit remains intact, given the progressive nature of the orders of this Court.
20. The upshot is that the application dated 19th August 2024 is hereby dismissed with costs to the respondent. This order binds ELC No.207 of 2015 as consolidated—mutatis mutandis.
Dated, signed, and delivered virtually at Malindi on this 30th day of August 2024.
E. K. MAKORI
JUDGE
In the Presence of:
Dr. Khaminwa SC, for the Applicant
Mr. McCourt SC, for the Respondent
Mr. Ananda, for the Respondents in No.207 of 2015
Mshali: Court Assistant
In the absence of:
Mr. Mogaka, for the Respondents in No.61 of 2015