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JudgmentBETTIE ATIENO NANGA VERSUS MIDDLE EAST BANK LTD14 min read

BETTIE ATIENO NANGA VERSUS MIDDLE EAST BANK LTD

High Court at Milimani High Court · · Njoki Mwangi

1. The defendant/applicant filed a Notice of Motion application dated 21st August 2020, which was subsequently amended on 7th November 2024, pursuant to the provisions of Order 42 Rule 6 of the Civil Procedure Rules, 2010, and Sections 1A, 1B & 3A of the Civil Procedure Act seeking an order for stay of execution of the Judgment delivered on 8th July 2020, by the High Court (differently constituted), pending the hearing and determination of the Appeal filed at the Court of Appeal.
2. The application is premised on the grounds on the face of the Motion, and it is supported by an affidavit sworn on 7th November 2024 by Ms Elizabeth Ong’are, the defendant’s Credit Manager. Ms Ong’are averred that on 8th July 2020, Lady Justice Mary Kasango declared the charge over all that property known as Nairobi/Block 103/201 Mugoya South C and the related guarantee invalid, ordered the defendant to discharge and return the Title to the said property within sixty (60) days, and awarded costs to the plaintiff. Aggrieved by the said Judgment, the defendant filed the requisite Notice of Appeal and lodged an Appeal and requested for certified proceedings without delay. She stated that the Trial Court had granted a 30-day stay of execution, which has since lapsed.
3. Ms Ong’are asserted that the defendant has an arguable Appeal with high chances of success, citing several alleged errors in law and fact by the Trial Judge, including misinterpretation of the Registered Land Act, imposing duties not required by law, disregarding uncontroverted evidence, ignoring admissions and prior conduct of the plaintiff, and wrongly nullifying securities. She stated that unless a stay of execution is granted, the defendant will suffer substantial loss by losing security for advanced funds, and the Appeal will be rendered nugatory. Ms Ong’are averred that the defendant is ready and willing to provide security or comply with conditions the Court may impose.
4. In opposition to the application, the plaintiff filed a replying affidavit sworn on 13th January 2025 by Ms Sarah Beverly Ombuya, the plaintiff herein. She averred that under Order 42 Rule 6 of the Civil Procedure Rules, 2010, an applicant must prove that substantial loss will occur without stay of execution, that the application was made without unreasonable delay and must express willingness/readiness to provide security for the due performance of the decree. She contended that the defendant has not demonstrated the substantial loss it stands to suffer since execution and enjoyment of a Judgment cannot in itself amount to substantial loss. Further, that any loss if the Appeal succeeds, can be compensated by an award of damages. In addition to the foregoing, Ms Ombuya stated that the instant application was filed over four (4) years after delivery of the Judgment, with no explanation for the delay, making it unreasonable and an afterthought.
5. In a rejoinder, the defendant filed a further affidavit sworn on 7th February 2025 by Ms Elizabeth Ong’are, the defendant’s Credit Manager. She contended that the defendant has met the legal requirements for stay of execution as earlier demonstrated, emphasizing that substantial loss would occur if the Title to Nairobi/Block 103/201 Mugoya South C is released and the deceased’s Estate distributed, since it is the only security for a facility exceeding Kshs.3,500,000/=. Ms Ong’are refuted the plaintiff’s claim of a four-year delay, clarifying that the stay application was filed on 21st August 2020, only one month after Judgment. She asserted that any subsequent delay was due to the process of obtaining a grant ad litem for substitution of the deceased plaintiff, which was beyond the defendant’s control.
6. The application herein was canvassed by way of written submissions. The defendant’s submissions were filed on 21st February 2025 & 20th March 2025 by the law firm of Mokaya & Onyambu Advocates, whereas the plaintiff’s submissions were filed on 12th March 2025 by the law firm of Now Advocates LLP.
7. Mr. Onyango, learned Counsel for the defendant submitted that aggrieved by the Judgment delivered by the Court on 8th July 2020, the defendant lodged a Notice of Appeal, and on 21st August 2020 it filed the instant application for stay of execution. He explained that progress in determining this application was delayed by the death of the plaintiff and the time taken by her Estate to obtain a grant ad litem after which leave to amend the instant application was later granted. Counsel submitted that the defendant has satisfied the conditions for stay of execution under Order 42 Rule 6(2) of the Civil Procedure Rules. He argued that substantial loss would result if the Title is released and the Estate distributed, as the defendant would lose its only security for a loan of Kshs.3,500,000/= and recovery may be impossible. To buttress these submissions, Mr. Onyango relied on the Court of Appeal case of National Industrial Credit Bank Ltd v Aquinas Francis Wasike & another [2006] KECA 333 (KLR) and the case of James Wangalwa & another v Agnes Naliaka Cheseto [2012] KEHC 1094 (KLR).
8. Ms Nungo, learned Counsel for the plaintiff relied on the Supreme Court case of Konchellah v Sunkuli & 2 others [2018] KESC 58 (KLR) and the case of In re Estate of Francis Obaga Mwarere (Deceased) [2024] KEHC 1371 (KLR), and submitted that the amended affidavit in support of the instant application filed on 7th November 2024 is undated, contrary to Section 5 of the Oaths and Statutory Declarations Act, and as such, it is bad in law. Counsel contended that the defendant attempted to cure the defect by irregularly uploading a purported amended affidavit sworn on 7th November 2024 and filed on 10th February 2025 without leave of the Court. She cited the case of Wasike v Lusenaka & another [2023] KEHC 3671 (KLR), and asserted that the amended supporting affidavit filed on 10th February 2025 is irregular and inadmissible, making the instant application fatally defective.
9. Counsel submitted that the defendant has failed to demonstrate substantial loss, as required by law and judicial precedent, since no cogent or documentary evidence has been provided. She relied on the cases of Samvir Trustee Limited v Guardian Bank Limited [2007] KEHC 2438 (KLR) Michael Ntouthi Mitheu v Abraham Kivondo Musau [2021] KEHC 4530 (KLR), and asserted that the burden of proof lies squarely on the applicant to show that the respondent cannot refund the decretal sum if the Appeal succeeds, and mere assertions as is the case herein are insufficient. She relied on the Court of Appeal case of Mungai & 3 others v Mbugua & another [2024] KECA 1752 (KLR), and argued that there is no valid Appeal pending before the Court of Appeal, as Appeal No. E329 of 2020 abated under Rule 102 of the Court of Appeal Rules following the death of the plaintiff in 2020, and no substitution was made within twelve (12) months, and stated that there is no risk of the intended Appeal being rendered nugatory.
10. In a rejoinder, Mr. Onyango relied on the case of Kabocha & 2 others v Kamau & another [1987] KECA 60 (KLR) and submitted that the plaintiff died before the Notice of Appeal was lodged. He asserted that by virtue of Rule 87(2) of the Court of Appeal Rules, 2022, such an Appeal remains competent and the legal representative may be substituted, unlike under Rule 102 which applies where death occurs after lodgment of the Appeal. In the alternative, Counsel argued that even if Rule 102 was applicable, sufficient cause exists to revive the Appeal given the delay in obtaining letters of administration for the deceased’s Estate, as recognized by the Court of Appeal in Njoroge & another v Kamau (Deceased) & another [2024] KECA 806 (KLR).
11. Mr. Onyango emphasized that a Notice and the Record of Appeal were duly filed, hence the Court of Appeal is properly seized of the matter, especially since the plaintiff has not challenged the competence of the Appeal.
12. On the objection to the Supporting Affidavit, Mr. Onyango referred to the provisions of Article 159(2)(d) of the Constitution and the cases of Chamber of Business Sector in Kenya v County Government of Kiambu & 3 others [2024] KEHC 10157 (KLR) and Flora Cherono v Mary Njihia & 9 others [2021] KEELC 1740 (KLR), and submitted that the omission of a date on the affidavit is a curable technicality which caused no prejudice, more so, since the defect was rectified.

ANALYSIS AND DETERMINATION.
13. I have considered the application filed herein, the grounds on the face of it and the affidavits filed in support thereof. I have also considered the replying affidavit by the plaintiff and the written submissions by Counsel for the parties. The issues that arise for determination are –
i) Whether the instant application is fatally defective; and
ii) Whether the defendant has met the conditions to warrant being granted an order for stay of execution pending Appeal.
Whether the instant application is fatally defective.
14. The plaintiff relied on the provisions of Section 5 of the Oaths and Statutory Declarations Act and submitted that the instant application is fatally defective for being accompanied by an undated supporting affidavit. The defendant on the other hand submitted that the omission of a date on the said affidavit was a curable technicality which caused no prejudice especially since the defect has been rectified by the defendant having filed and uploaded a dated affidavit.
15. Section 5 of the Oaths and Statutory Declarations Act provides that -
Every commissioner for oaths before whom any oath or affidavit is taken or made under this Act shall state truly in the jurat or attestation at what place and on what date the oath or affidavit is taken or made.
16. The import of the above provisions is that every affidavit must be sworn before a Commissioner for Oaths or Magistrate and must bear the jurat indicating the date and place of swearing.
17. It is now well settled that an affidavit that is unsigned or undated is generally treated as no affidavit in law and cannot properly support an application. In this case however, the defendant explained that the omission was inadvertent and promptly rectified by filing and serving a properly dated and signed affidavit. Guided by the provisions under Article 159(2)(d) of the Constitution which enjoin Courts not to pay undue regard to technicalities, I am persuaded that the omission, though irregular, did not occasion prejudice to the plaintiff and was curable. Further, upon perusal of the affidavit filed together with the instant application and the one filed on 10th February 2025, the only difference between the two is that one is dated and the other one is not, otherwise the contents of both affidavits are the same.
18. The Court of Appeal in the case of Toshike Construction Company Limited v Harambee Co-operative Savings & another [2019] KECA 598 (KLR) adopted the holding by the Uganda Court of Appeal in the case of Saggu Roadmaster Cycles (U) Ltd [2002] 1 E A 258, where it was held as follows–
..the defect in the jurat or any irregularity in the form of an affidavit cannot be allowed to vitiate an affidavit in view of Article 126 (8), of the 1995 Constitution, which stipulates that substantive justice shall be administered without undue regard to technicalities. I should perhaps mention that the jurat is the short statement at the foot of the affidavit indicating when, where and before whom it was sworn. It would follow that the learned judge had the power to order that the undated affidavit be dated in Court or that the affidavit be re-sworn before putting it on record. He was also correct to penalize the offending party in costs...
………….
…the statutory provision which renders it mandatory to date the affidavit before tendering it in Court simply means that an affidavit cannot be used without dating it or indicating where it was sworn and before whom. The errors and omissions regarding the date, place and the commissioner cannot vitiate an application.
19. Bearing in mind the foregoing persuasive authority this Court finds that the defect complained of by the plaintiff was duly cured by the subsequent filing of the regularized affidavit, thus the instant application is not fatally defective.
Whether the defendant has met the conditions to warrant being granted an order for stay of execution pending Appeal.
20. The principles that govern the grant of an order for stay of execution pending Appeal are provided for under Order 42 Rule 6(2) of the Civil Procedure Rules, 2010, which states as follows –
No order for stay of execution shall be made under sub rule (1) unless -
a) the Court is satisfied that substantial loss may result to the applicant unless the order is made and that the application has been made without unreasonable delay; and
b) such security as the Court orders for the due performance of such decree or order as may ultimately be binding on him has been given by the applicant.”
21. In considering an application for stay of execution pending Appeal, the Court must strike a balance between the competing rights of the parties. On the one hand is the appellant’s undoubted right of Appeal, and on the other hand, the respondent’s entitlement to enjoy the fruits of a valid Judgment unless sufficient cause is shown. In the oft cited case of Vishram Ravji Halai v Thornton & Turpin [1990] KLR 365, the Court of Appeal held that while its power to grant a stay pending Appeal is unfettered, the High Court’s jurisdiction under Order 42 Rule 6 of the Civil Procedure Rules, 2010, is circumscribed by three specific conditions, namely -
i) establishment of a sufficient cause;
ii) satisfaction of substantial loss; and
iii) the furnishing of security.
22. This Court notes that while the plaintiff has challenged the competency of the defendant’s Appeal pending before the Court of Appeal, the issue of its validity squarely falls within the jurisdiction of that Court. At this stage, the only task before this Court is to establish whether an Appeal has been filed against its Judgment of 8th July 2020. In the circumstances, the Court finds that the propriety of Civil Appeal No. E329 of 2020 can only be questioned before the Court of Appeal and not before this Court. In the absence of any order from the Court of Appeal declaring Civil Appeal No. E329 of 2020 invalid, this Court holds that a valid Appeal is still subsisting against the Judgment of 8th July 2020.
23. On the question of substantial loss, the Court in the case of James Wangalwa & Another v Agnes Naliaka Cheseto (supra), emphasized that substantial loss is the kind of loss that must be averted by maintaining the status quo, as it would otherwise render an appeal nugatory. The Court clarified that the mere fact of execution or the possibility of it does not, by itself, amount to substantial loss, unless such execution would irreversibly undermine or defeat the core rights of the applicant in the Appeal
24. The defendant’s case is that if the Title to Nairobi/Block 103/201 Mugoya South C is released and the Estate distributed, it will be deprived of its only security for a loan of Kshs.3,500,000/=, rendering recovery uncertain. It is not disputed that the suit property was offered by the plaintiff as the guarantor, for financial facilities exceeding Kshs.3,500,000/= advanced to Simlo Enterprises Ltd, the principal debtor, which defaulted. While this Court acknowledges the plaintiff’s argument that mere execution of a valid Judgment does not in itself, constitute substantial loss and that no concrete proof was provided to demonstrate the defendant’s inability to recover the debt, there is equally no evidence before the Court to show that the said loan has been repaid or that should the defendant’s Appeal succeed, the plaintiff would be in a position to refund the aforesaid sum together with interest.
25. This Court is therefore satisfied that the defendant has established that it is likely to suffer substantial loss should the application herein be disallowed.
26. On the issue of the delay in filing of the instant application, the plaintiff averred that the instant application was filed inordinately late, approximately four (4) years after delivery of the Judgment by the Court on 8th July 2020. The Court record however confirms that the original application for stay of execution was filed on 21st August 2020, about a month after the said Judgment was delivered. The subsequent delay was occasioned by the plaintiff’s demise and the time required to obtain a grant ad litem, after which the application was amended on 7th November 2024. In the circumstances, this Court is persuaded by the defendant’s explanation and finds that the delay relates to the determination of the application rather than its filing, the latter having been made promptly within a month of the Judgment in issue.
27. From the defendant’s submissions and affidavits in support of the instant application, it is clear that the defendant has expressed willingness to provide security and to comply with any conditions that this Court may impose. This satisfies the statutory requirement for security for the due performance of the decree. This was the position taken by the Court in the case of Focin Motorcycle Co. Limited v Ann Wambui Wangui & another [2018] KEHC 8358 (KLR), with which this Court concurs, where it was held that -
Where the applicant proposes to provide security as the Applicant has done, it is a mark of good faith that the application for stay is not just meant to deny the respondent the fruits of Judgment. My view is that it is sufficient for the applicant to state that he is ready to provide security or to propose the kind of security but it is the discretion of the Court to determine the security.
28. The upshot is that the application herein is merited. It is hereby allowed in the following terms –
i) Pending the hearing and determination of the Appeal filed at the Court of Appeal, this Court hereby grants an order for stay of execution of the Judgment and decree of this Court delivered on 8th July 2020;
ii) The defendant shall deposit the original Title Deed of the suit property in Court within seven (7) days from the date of this Ruling;
iii) In default of Order No. (ii) above, the instant application shall be deemed to have been dismissed and the plaintiff shall be at liberty to execute this Court’s Judgment delivered on 8th July 2020; and
iv) Costs of this application shall abide the outcome of the Appeal.
It is so ordered.
DATED, SIGNED and DELIVERED at NAIROBI on this 5th day of December, 2025. Ruling delivered through Microsoft Teams Online Platform.
NJOKI MWANGI
JUDGE
In the presence of:-
Mr. Peter Raymond h/b for Mr. Onyambu for the defendant/applicant
Mr. Mugambi h/b for Ms Mugo for the plaintiff/respondent
Ms B. Wokabi – Court Assistant.