National Bank of Kenya Limited v Ecobank Kenya Limited & another [2020] eKLR Case Summary

Case Brief: National Bank of Kenya Limited v Ecobank Kenya Limited & another [2020] eKLR


1. Case Information:
- Name of the Case: National Bank of Kenya Limited v. Ecobank Kenya Limited & Pesa Print Limited
- Case Number: Civil Application No. E341 of 2020
- Court: Court of Appeal, Nairobi
- Date Delivered: 23rd October 2020
- Category of Law: Civil
- Judge(s): Koome, Musinga & Gatembu, JJ.A.
- Country: Kenya

2. Questions Presented:
The central legal issues before the court include whether to grant a stay of execution of the judgment delivered by the High Court, and whether the applicant's intended appeal is arguable and would be rendered nugatory if the stay is not granted.

3. Facts of the Case:
The applicant, National Bank of Kenya Limited, sought a stay of execution of a judgment delivered on 2nd September 2020 by G. Nzioka, J., which allowed the claim of the 1st respondent, Ecobank Kenya Limited, for USD 3,681,924.64 based on a Deed of Assignment of Receivables. The 2nd respondent, Pesa Print Limited, had procured a credit facility from the 1st respondent to facilitate a contract with the National Transport and Safety Authority (NTSA) for the supply of smart card driving licenses. Due to delays in payment from NTSA, the applicant was unable to pay the receivables to the 1st respondent, leading to the lawsuit.

4. Procedural History:
The applicant filed a Notice of Motion on 24th September 2020 seeking a stay of execution of the High Court's judgment. The applicant argued that the intended appeal was arguable and that without a stay, it would suffer significant hardship. The 1st respondent opposed the application, arguing that the intended appeal was frivolous and that it would not suffer undue hardship if the stay was denied. The court considered the application based on established principles for granting stays.

5. Analysis:
- Rules: The court evaluated the application under Rule 5(2)(b) of the Court's Rules, which governs stay applications. It considered the need for an arguable appeal and whether the appeal would be rendered nugatory if the stay was not granted.
- Case Law: The court referenced previous cases, including *Stanley Kangethe Kinyanjui v Tony Ketter & Others* and *Reliance Bank Ltd v Norlake Investments Ltd*, which emphasize the criteria for granting stays and the importance of considering the specific circumstances of each case.
- Application: The court found that the applicant's appeal presented arguable issues, particularly regarding the timing of the payment obligations under the Deed of Assignment. It also recognized the substantial amount of the decretal sum, which, if paid before the appeal was determined, could cause significant hardship to the applicant. The court concluded that granting the stay was necessary to prevent the appeal from being rendered nugatory.

6. Conclusion:
The Court of Appeal granted the applicant's application for a stay of execution, allowing the appeal to be heard without the immediate pressure of financial obligation. This ruling underscores the court's willingness to prioritize the rights of parties in significant financial disputes while ensuring access to justice.

7. Dissent:
There were no dissenting opinions noted in the ruling, as the decision was unanimous among the judges.

8. Summary:
The Court of Appeal ruled in favor of the National Bank of Kenya Limited, granting a stay of execution of the judgment that favored Ecobank Kenya Limited. The decision highlights the court's consideration of the potential hardships faced by the applicant and reinforces the principle that an arguable appeal should be allowed to proceed without immediate execution of a significant monetary judgment. This case emphasizes the importance of ensuring that parties are not unduly burdened while seeking justice through the appeals process.