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1. Before court is an application, by the appellant, dated 21 March 2025 for stay of execution of a judgment and decree issued in Mombasa Small Claims Court case no. E1351 of 2024 by the Honourable J.W. Mwangi. The prayer for this particular order has been captured, thus:
“3. That pending the hearing and determination of the appeal filed herein, orders do issue staying the execution of the judgment and consequential decree arising out of the judgment delivered in Mombasa SCCCOMM No. E1351 of 2024 by Hon. J.W. MWANGI on 21/02/2025.”
2. The application is expressed to be brought under Articles 50, 159 & 165(6) & (7) of the Constitution; Sections 38, 39 and 43 of the Small Claims Court Act, cap.10A; Sections 1A and 3A of the Civil Procedure Act, cap. 21; and, Order 1 Rule 6, of the Civil Procedure Rules.
3. The application is supported by the appellant’s own affidavit in which she has sworn that judgment was entered against her in the Small Claims Court on 21 February 2025. Being dissatisfied with the judgment, she filed the instant appeal.
4. The applicant has been advised by her learned counsel on record, which advice she verily believes to be true, that the appeal is arguable and has high chances of success particularly because despite having challenged the jurisdiction of the trial court over the subject matter, the ruling on the objection was made within the final judgment hence denying the applicant the chance of lodging an interlocutory appeal or revision.
5. That notwithstanding, the respondent has commenced execution process and if the execution is not stayed, the substratum of the appeal will dissipate. Consequently, the applicant will suffer substantial loss.
6. By a replying affidavit sworn by Michael Omondi Okach, who has introduced himself as a director of the respondent, the latter has opposed the application. He has admitted that indeed the respondent holds a judgment of Kshs. 980,204/= against the appellant. However, although the respondent has extracted the decree, it is yet to commence the execution process hence the appellant’s application is said to be premature.
7. In any event, it has been sworn on behalf of the respondent, that the respondent is capable of refunding the decretal sum if the appellant’s appeal succeeds. The respondent also notes that the applicant has not offered any security for the performance of the decree.
8. This being an application for stay pending the determination of appeal, I need not delve into the merits of the appeal. My impression of the appeal, however, is that it is not a frivolous appeal, the major question being raised, and which deserves the attention of this Honourable Court, being whether the Small Claims Court had jurisdiction to determine the dispute out of which the impugned judgment arose.
9. In the respondent’s statement of claim filed in the Small Claims Court, the circumstances from which the claim arose have been summarized as follows:
“a) The Claimant is a bar and restaurant located in Buxton within Mombasa County.
b) That in 2023 the Respondent was employed as an accountant by the manager then one Mercy Obade Ogallo.
c)That due to misappropriation of the company funds they both left the company and after doing a thorough audit the claimant discovered that the respondent had opened her own account No. 0711403027 into which customers were depositing and/or making payments to, instead of the company''s Till No. 739376 and KCB Account No.1180885422.
d) It is the claimant''s case that from June 2024 to 19th July 2024 Kshs.980, 204/= which is money that was due to the company had been deposited to the respondent aforesaid account.
e) That despite writing to the respondent a demand letter dated 06/11/2024 she has failed, refused and neglected to account for and or refund the aforesaid amount to the company hence this suit.”
10. It is apparent from the respondent’s own pleadings that the appellant was the respondent’s employee at the time material to the suit before the Small Claims Court. The question that arose in the court and which has now escalated to this Honourable Court is whether, in the circumstances which the dispute arose, the Employment and Labour Relations Court, rather than the Small Claims Court, was the proper court seized of jurisdiction to determine the dispute.
11. I need not answer this at this stage but to the extent of demonstrating whether the appellant’s appeal is arguable and not frivolous, I need only to refer to two provisions of the law respectively in the Employment and Labour Relations Court Act and the Small Claims Court Act. Section 12 (1) (a) of the Employment and Labour Relations Court cap. 8E reads as follows:
12. Jurisdiction of the Court
(1) The Court shall have exclusive original and appellate jurisdiction to hear and determine all disputes referred to it in accordance with Article 162(2) of the Constitution and the provisions of this Act or any other written law which extends jurisdiction to the Court relating to employment and labour relations including —
(a) disputes relating to or arising out of employment between an employer and an employee;
12. Section 12 of the Small Claims Court Act, on the other hand, speaks of the Small Claims Court’s jurisdiction in the following terms:
12. Nature of claims and pecuniary jurisdiction
(1) Subject to this Act, the Rules and any other law, the Court has jurisdiction to determine any civil claim relating to—
(a) a contract for sale and supply of goods or services;
(b) a contract relating to money held and received;
(c) liability in tort in respect of loss or damage caused to any property or for the delivery or recovery of movable property;
(d) compensation for personal injuries; and
(e) set-off and counterclaim under any contract.
(2) Without prejudice to the generality of subsection (1), the Court may exercise any other civil jurisdiction as may be conferred under any other written law.
(3) The pecuniary jurisdiction of the Court shall be limited to one million shillings.
(4) Without prejudice to subsection (3), the Chief Justice may determine by notice in the Gazette such other pecuniary jurisdiction of the Court as the Chief Justice thinks fit.
13. And as far as the specific question of employment and labour relations is concerned, section 13 (5) of the Small Claims Court Act states as follows:
A claim shall not be brought before the Court if the cause of action is founded upon defamation, libel, slander, malicious prosecution or is upon a dispute over a title to or possession of land, or employment and labour relations.
14. Against the background of these legal provisions, amongst other provisions that this Court may consider at the hearing of the main appeal, I am satisfied that the jurisdictional question raised in this appeal rates the appeal as an arguable and not a frivolous appeal.
15. In Butt v Rent Restriction Tribunal (1979) KECA 22 (KLR) Madan, J.A. emphasised the need for a stay order where there is arguable appeal. The learned judge held:
“If there is no other overwhelming hindrance, a stay ought to be granted so that an appeal, if successful, may not be nugatory. A stay which would otherwise be granted ought not to be refused because the judge considers that another, which in his opinion will be a better remedy, will become available to the applicant at the conclusion of the proceedings.
It is in the discretion of the court to grant or refuse a stay but what has to be judged in every case is whether there are or not particular circumstances in the case to make an order staying execution. It has been said that the court as a general rule ought to exercise its best discretion in a way so as not to prevent the appeal, if successful from being nugatory, per Brett, LJ in Wilson v Church (No 2) 12 Ch D (1879) 454 at p 459. In the same case, Cotton LJ said at p 458:
“I will state my opinion that when a party is appealing, exercising his undoubted right of appeal, this court ought to see that the appeal, if successful, is not nugatory.”
16. Although these pronouncements were made in the context of an appeal from this Honourable Court to the Court of Appeal, the ratio that, in exercise of its discretion, the court should consider the consequences of a successful appeal if stay is not granted, applies in equal measure to appeals to this Honourable Court.
17. As far as the written law is concerned, the provision pertinent to the applicant’s application is order 42 rule 6 (1) and (2) of the Civil Procedure Rules. This rule reads as follows:
6. Stay in case of appeal [Order 42, rule 6]
(1) No appeal or second appeal shall operate as a stay of execution or proceedings under a decree or order appealed from except in so far as the court appealed from may order but, the court appealed from may for sufficient cause order stay of execution of such decree or order, and whether the application for such stay shall have been granted or refused by the court appealed from, the court to which such appeal is preferred shall be at liberty, on application being made, to consider such application and to make such order thereon as may to it seem just, and any person aggrieved by an order of stay made by the court from whose decision the appeal is preferred may apply to the appellate court to have such order set aside.
(2) No order for stay of execution shall be made under subrule (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.
18. The order for stay of execution under Order 42 Rule 6(1) of the Civil Procedure Rules is, of course, a discretionary remedy. The discretion with which this Court is clothed is only tampered with by Order 42 Rule 6(2) of the same Rules which stipulates when that discretion will not be exercised in favour of an applicant for such an order; and, in particular, sets out the circumstances when stay of execution will be declined notwithstanding the latitude given to court to exercise its discretion under Rule 6(1).
19. What I understand order 42 rule 6(2) to mean is that notwithstanding that an application for stay may be made timeously; and that a substantial loss may result if stay is not granted; and, finally that an applicant is disposed to provide security for the performance of the decree, the court may still decline to grant the order for stay if circumstances so demand. If it was to be argued that an applicant is entitled to the order of stay once he meets all these conditions, then the remedy would no longer be discretionary.
20. For the reasons I have given, I hereby allow the application except that stay of execution is granted on condition that the applicant will deposit in court the sum of Kshs. 200,000/= as security for the performance of the decree within thirty days from the date of this order. The costs of this application will abide the outcome of the appeal. It is so ordered.
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1. Before court is an application, by the appellant, dated 21 March 2025 for stay of execution of a judgment and decree issued in Mombasa Small Claims Court case no. E1351 of 2024 by the Honourable J.W. Mwangi. The prayer for this particular order has been captured, thus:
“3. That pending the hearing and determination of the appeal filed herein, orders do issue staying the execution of the judgment and consequential decree arising out of the judgment delivered in Mombasa SCCCOMM No. E1351 of 2024 by Hon. J.W. MWANGI on 21/02/2025.”
2. The application is expressed to be brought under Articles 50, 159 & 165(6) & (7) of the Constitution; Sections 38, 39 and 43 of the Small Claims Court Act, cap.10A; Sections 1A and 3A of the Civil Procedure Act, cap. 21; and, Order 1 Rule 6, of the Civil Procedure Rules.
3. The application is supported by the appellant’s own affidavit in which she has sworn that judgment was entered against her in the Small Claims Court on 21 February 2025. Being dissatisfied with the judgment, she filed the instant appeal.
4. The applicant has been advised by her learned counsel on record, which advice she verily believes to be true, that the appeal is arguable and has high chances of success particularly because despite having challenged the jurisdiction of the trial court over the subject matter, the ruling on the objection was made within the final judgment hence denying the applicant the chance of lodging an interlocutory appeal or revision.
5. That notwithstanding, the respondent has commenced execution process and if the execution is not stayed, the substratum of the appeal will dissipate. Consequently, the applicant will suffer substantial loss.
6. By a replying affidavit sworn by Michael Omondi Okach, who has introduced himself as a director of the respondent, the latter has opposed the application. He has admitted that indeed the respondent holds a judgment of Kshs. 980,204/= against the appellant. However, although the respondent has extracted the decree, it is yet to commence the execution process hence the appellant’s application is said to be premature.
7. In any event, it has been sworn on behalf of the respondent, that the respondent is capable of refunding the decretal sum if the appellant’s appeal succeeds. The respondent also notes that the applicant has not offered any security for the performance of the decree.
8. This being an application for stay pending the determination of appeal, I need not delve into the merits of the appeal. My impression of the appeal, however, is that it is not a frivolous appeal, the major question being raised, and which deserves the attention of this Honourable Court, being whether the Small Claims Court had jurisdiction to determine the dispute out of which the impugned judgment arose.
9. In the respondent’s statement of claim filed in the Small Claims Court, the circumstances from which the claim arose have been summarized as follows:
“a) The Claimant is a bar and restaurant located in Buxton within Mombasa County.
b) That in 2023 the Respondent was employed as an accountant by the manager then one Mercy Obade Ogallo.
c)That due to misappropriation of the company funds they both left the company and after doing a thorough audit the claimant discovered that the respondent had opened her own account No. 0711403027 into which customers were depositing and/or making payments to, instead of the company''s Till No. 739376 and KCB Account No.1180885422.
d) It is the claimant''s case that from June 2024 to 19th July 2024 Kshs.980, 204/= which is money that was due to the company had been deposited to the respondent aforesaid account.
e) That despite writing to the respondent a demand letter dated 06/11/2024 she has failed, refused and neglected to account for and or refund the aforesaid amount to the company hence this suit.”
10. It is apparent from the respondent’s own pleadings that the appellant was the respondent’s employee at the time material to the suit before the Small Claims Court. The question that arose in the court and which has now escalated to this Honourable Court is whether, in the circumstances which the dispute arose, the Employment and Labour Relations Court, rather than the Small Claims Court, was the proper court seized of jurisdiction to determine the dispute.
11. I need not answer this at this stage but to the extent of demonstrating whether the appellant’s appeal is arguable and not frivolous, I need only to refer to two provisions of the law respectively in the Employment and Labour Relations Court Act and the Small Claims Court Act. Section 12 (1) (a) of the Employment and Labour Relations Court cap. 8E reads as follows:
12. Jurisdiction of the Court
(1) The Court shall have exclusive original and appellate jurisdiction to hear and determine all disputes referred to it in accordance with Article 162(2) of the Constitution and the provisions of this Act or any other written law which extends jurisdiction to the Court relating to employment and labour relations including —
(a) disputes relating to or arising out of employment between an employer and an employee;
12. Section 12 of the Small Claims Court Act, on the other hand, speaks of the Small Claims Court’s jurisdiction in the following terms:
12. Nature of claims and pecuniary jurisdiction
(1) Subject to this Act, the Rules and any other law, the Court has jurisdiction to determine any civil claim relating to—
(a) a contract for sale and supply of goods or services;
(b) a contract relating to money held and received;
(c) liability in tort in respect of loss or damage caused to any property or for the delivery or recovery of movable property;
(d) compensation for personal injuries; and
(e) set-off and counterclaim under any contract.
(2) Without prejudice to the generality of subsection (1), the Court may exercise any other civil jurisdiction as may be conferred under any other written law.
(3) The pecuniary jurisdiction of the Court shall be limited to one million shillings.
(4) Without prejudice to subsection (3), the Chief Justice may determine by notice in the Gazette such other pecuniary jurisdiction of the Court as the Chief Justice thinks fit.
13. And as far as the specific question of employment and labour relations is concerned, section 13 (5) of the Small Claims Court Act states as follows:
A claim shall not be brought before the Court if the cause of action is founded upon defamation, libel, slander, malicious prosecution or is upon a dispute over a title to or possession of land, or employment and labour relations.
14. Against the background of these legal provisions, amongst other provisions that this Court may consider at the hearing of the main appeal, I am satisfied that the jurisdictional question raised in this appeal rates the appeal as an arguable and not a frivolous appeal.
15. In Butt v Rent Restriction Tribunal (1979) KECA 22 (KLR) Madan, J.A. emphasised the need for a stay order where there is arguable appeal. The learned judge held:
“If there is no other overwhelming hindrance, a stay ought to be granted so that an appeal, if successful, may not be nugatory. A stay which would otherwise be granted ought not to be refused because the judge considers that another, which in his opinion will be a better remedy, will become available to the applicant at the conclusion of the proceedings.
It is in the discretion of the court to grant or refuse a stay but what has to be judged in every case is whether there are or not particular circumstances in the case to make an order staying execution. It has been said that the court as a general rule ought to exercise its best discretion in a way so as not to prevent the appeal, if successful from being nugatory, per Brett, LJ in Wilson v Church (No 2) 12 Ch D (1879) 454 at p 459. In the same case, Cotton LJ said at p 458:
“I will state my opinion that when a party is appealing, exercising his undoubted right of appeal, this court ought to see that the appeal, if successful, is not nugatory.”
16. Although these pronouncements were made in the context of an appeal from this Honourable Court to the Court of Appeal, the ratio that, in exercise of its discretion, the court should consider the consequences of a successful appeal if stay is not granted, applies in equal measure to appeals to this Honourable Court.
17. As far as the written law is concerned, the provision pertinent to the applicant’s application is order 42 rule 6 (1) and (2) of the Civil Procedure Rules. This rule reads as follows:
6. Stay in case of appeal [Order 42, rule 6]
(1) No appeal or second appeal shall operate as a stay of execution or proceedings under a decree or order appealed from except in so far as the court appealed from may order but, the court appealed from may for sufficient cause order stay of execution of such decree or order, and whether the application for such stay shall have been granted or refused by the court appealed from, the court to which such appeal is preferred shall be at liberty, on application being made, to consider such application and to make such order thereon as may to it seem just, and any person aggrieved by an order of stay made by the court from whose decision the appeal is preferred may apply to the appellate court to have such order set aside.
(2) No order for stay of execution shall be made under subrule (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.
18. The order for stay of execution under Order 42 Rule 6(1) of the Civil Procedure Rules is, of course, a discretionary remedy. The discretion with which this Court is clothed is only tampered with by Order 42 Rule 6(2) of the same Rules which stipulates when that discretion will not be exercised in favour of an applicant for such an order; and, in particular, sets out the circumstances when stay of execution will be declined notwithstanding the latitude given to court to exercise its discretion under Rule 6(1).
19. What I understand order 42 rule 6(2) to mean is that notwithstanding that an application for stay may be made timeously; and that a substantial loss may result if stay is not granted; and, finally that an applicant is disposed to provide security for the performance of the decree, the court may still decline to grant the order for stay if circumstances so demand. If it was to be argued that an applicant is entitled to the order of stay once he meets all these conditions, then the remedy would no longer be discretionary.
20. For the reasons I have given, I hereby allow the application except that stay of execution is granted on condition that the applicant will deposit in court the sum of Kshs. 200,000/= as security for the performance of the decree within thirty days from the date of this order. The costs of this application will abide the outcome of the appeal. It is so ordered.
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