Background and Introduction
1. This Ruling determines the appellants’ application dated 7th October 2024 specifically brought under Order 47 Rule 7(2), Order 51 Rule 1 of the Civil Procedure Rules, Section 1, 1A, 3,3A, 63(e) of the Civil Procedure Act and Articles 48 and 159 of the Constitution of Kenya.
2. The applicants seek a review of this Court’s earlier order that required them to deposit Kshs. 207,448/= as security for the due performance of the decree, as a condition for stay of execution pending appeal. They propose that, in lieu of the cash deposit, the Court accepts a title deed for parcel No. Olenguruone/Keringet Block 2/319 as security. Additionally, the applicants pray that the orders for stay of execution pending appeal be maintained on the revised terms, to prevent execution of the decree until their appeal is heard and determined.
3. The context of the application is that judgment was entered in favor of the respondents against the applicants, and the applicants have filed an appeal which is pending. On a prior application, this Court granted the applicants a stay of execution pending appeal, on condition that they deposit the sum of Kshs. 207,448/= as security within 30 days. The applicants now assert they were unable to meet that condition due to financial difficulties, hence the present application. They maintain that the property is of sufficient value to secure the decree amount.
4. The application is opposed by the 1st respondent. In the Replying Affidavit and through learned counsel’s submissions argues that the application does not satisfy the strict grounds for review set out in law. It is contended that the applicants have shown no new evidence, no error on the face of the record, and no other sufficient reason to justify a review; rather, they are simply unhappy with the earlier court order. The respondent submits that financial hardship was a circumstance within the applicants’ knowledge all along and thus cannot be a new discovery, nor does it constitute an error by the Court.
5. The 1st respondent casts doubt on the genuineness of the title deed, alleging that it might be fraudulent or otherwise not free from encumbrances. She also argues that land is not a liquid asset and that security for costs should be monetary and not in the form of documents typically used in criminal cases. In the respondent’s view, the Court’s original order for a cash deposit was proper and should not be disturbed. She urges the Court to dismiss the application, terming it a delaying tactic designed to deny the respondents the fruits of the judgment indefinitely.
Analysis and Determination
6. I have carefully considered the application and its response, the submissions on record, and the authorities cited. The core issue for determination is whether the applicants have met the legal threshold for review of the orders issued on 23rd July 2024.
7. A court’s authority to review its own decision is circumscribed by statute and established jurisprudence. Under Section 80 of the Civil Procedure Act and Order 45 Rule 1 of the Civil Procedure Rules, a party may seek a review of a decree or order based on three primary grounds:
a) discovery of new and important evidence which, despite due diligence, was not within the applicant’s knowledge or could not be produced at the time of the original ruling;
b) the presence of a clear mistake or error apparent on the face of the record; or
c) any other sufficient reason. court which passed the decree or made the order without unreasonable delay.
8. Additionally, Order 42 Rule 6 of the Civil Procedure Rules governs stay of execution pending appeal. One of the conditions under Rule 6(2)(b) is that the applicant for stay must furnish security for the due performance of the decree. The form and quantum of security are at the discretion of the court. The rule does not specify that security must be in cash; it only mandates “such security as the court orders.”
9. The principle of proportionality is key in determining the security to be furnished. In Gitahi & Another v Warugongo [1988] eKLR, the Court of Appeal cited with approval from Rosengrens Ltd v Safe Deposit Centres Ltd [1984] 3 All ER 198 where at page 200 the court stated:
“So long as the opposite party can adequately be protected, it is right and proper that security should be given in a way which is the least disadvantageous to the party giving that security.”
The same case went on to acknowledge that “security may take many forms,” and that a bank guarantee or payment into court are just examples “so long as it is adequate, then the form of it is immaterial.”
10. However, since the discretion lies with the Court, the applicant’s preference is not decisive. The Court must be persuaded that the alternative security proposed is both genuine and sufficient. In this regard, the Court observed that;
“The aim is to make sure, in an even-handed manner that the appeal will not be prejudiced and that the decretal sum is available if required. The respondent is not entitled, for instance, to make life difficult for the applicant, so as to tempt him into settling the appeal”.
11. My understanding of the decision by the Court of Appeal is that the overarching aim of security is to ensure that if the appeal fails, the respondents can recover the decretal amount without undue difficulty or delay.
12. The 1st respondent has attached in her replying affidavit, a letter forwarding the title deed to the property, to the Chairman of the Kenya Informal Traders Association for purposes of securing a facility. The letter dated 19th November 2003 is not controverted. At a worst-case scenario, a title that has already been charged as security would not in any case qualify as suitable security.
13. Furthermore, the applicants have not placed any valuation report on record to demonstrate that the property is sufficient to cover the decretal sum. Without such a valuation, the Court cannot presume or ascertain the adequacy of the proposed security.
14. Even assuming that the title were valid, the nature of land as security is such that it may not be readily available to satisfy the decree if the appeal is unsuccessful. Realizing value from the land would typically require additional litigation or enforcement processes such as auction, which as the respondents claim, would cause undue hardship and delays unlike cash which is liquid and immediately available upon determination of the appeal.
15. In addition to failing to cite any specific ground for review, the applicants have not demonstrated good faith or a willingness to comply with the court’s orders, even by attempting to deposit any portion of the required amount as a sign of commitment. Consequently, I find that the applicants have not met the legal threshold for review under Order 45 Rule 1 of the Civil Procedure Rules.
16. However, considering the financial constraints faced by the applicants, and in order to avoid unduly hindering their right of appeal, the Court issues the following final orders:
Disposition
i. The application dated 7th October 2024 succeeds only in part.
ii. The order requiring the deposit of Kshs. 207,448/= as security for costs is hereby upheld.
iii. The Court grants the applicants a further thirty (30) days within which to deposit the said amount in a joint interest-earning account in the names of the parties’ advocates.
iv. The amount may be paid in instalments within the said period.
v. In default, the stay of execution orders shall automatically lapse, and the respondents shall be at liberty to proceed with execution of the decree without further reference to this Court.
vi. Costs of the application shall await the outcome of the appeal.
DATED, SIGNED AND DELIVERED IN MOMBASA
THIS 17TH DAY OF APRIL 2025
F. MUGAMBI
JUDGE