Case ID:174762

Nilesh Jayantilal Kotedia v Guaranty Trust Bank Limited (Formally Fina Bank Limited) & another [2021] eKLR

Case Metadata

Case Number:

Civil Application Nai E021 of 2021

Parties:

Nilesh Jayantilal Kotedia v Guaranty Trust Bank Limited (Formally Fina Bank Limited) & Jagdeep Lalji Kotedia

Date Delivered:

07 May 2021

Case Class:

Civil

Court:

Court of Appeal at Nairobi

Case Action:

Ruling

Judge(s):

Sankale ole Kantai, Fatuma sichale, Agnes Kalekye Murgor

Citation:

Nilesh Jayantilal Kotedia v Guaranty Trust Bank Limited (Formally Fina Bank Limited) & another [2021] eKLR

Case History:

Being an application for stay of execution pending the hearing and determination of an intended appeal against the judgment and orders of the High Court at Nairobi (Tuiyott, J) delivered 23rd November 2020 in Milimani Commercial Civil Suit No 638 of 2005

Court Division:

Civil

County:

Nairobi

History Docket No:

Civil Suit 638 of 2005

History Judges:

Francis Tuiyott

History County:

Nairobi

Disclaimer:

The information contained in the above segment is not part of the judicial opinion delivered by the Court. The metadata has been prepared by Kenya Law as a guide in understanding the subject of the judicial opinion. Kenya Law makes no warranties as to the comprehensiveness or accuracy of the information

IN THE COURT OF APPEAL

AT NAIROBI

(CORAM: MURGOR, SICHALE & KANTAI, JJ.A.)

CIVIL APPLICATION NO. NAI E021 OF 2021

BETWEEN

NILESH JAYANTILAL KOTEDIA......................................APPLICANT

AND

GUARANTY TRUST BANK LIMITED

(formally FINA BANK LIMITED)

..............................1

ST

RESPONDENT

JAGDEEP LALJI KOTEDIA....................................2

ND

RESPONDENT

(

Being an application for stay of execution pending the hearing and determination of an

intended appeal against the judgment

and orders of the High Court at Nairobi (Tuiyott, J) delivered 23

rd

November 2020

in

Milimani Commercial Civil Suit No 638 of 2005

)

***************************************

RULING OF THE COURT

By a Notice of motion dated 26

th

January 2021, brought under

Article

159

of the

Constitution

and

rule 5 (2) (b)

the

Court of Appeal rules, the applicant, Nilesh Jayantilal Kotedia,

sought orders for stay of execution pending the hearing and determination of an intended appeal against the judgment and orders of the High Court at Nairobi (Tuiyott, J.) delivered on 23

rd

November 2020 pending the hearing and determination of the intended appeal.

The motion was brought on grounds that

the 1

st

respondent, Guaranty Trust Bank Limited (Formally Fina Bank Limited)

obtained judgment against

the applicant

,

Nilesh Jayantilal Kotedia, the 2

nd

respondent Jagdeep Lalji Kotedia and Mechanized Cargo Systems Limited (the Principal borrower)

jointly and severally in the sum of Kshs. 49,949,459/30 together with interest at the rate of 13.5% per annum from 30

th

June 2005 until payment in full; that thereafter the applicants were granted stay of execution orders for 21 days which orders were due to lapse on 14

th

December 2020.

Dissatisfied with the decision, the applicant intends to appeal against the judgment of the High Court and has filed Notice of Appeal on 2

nd

December 2020. In the meantime, the applicant seeks the orders of stay of execution as it is apprehensive that the 1

st

respondent will proceed with execution of the trial court’s orders.

It was contended that the appeal is arguable because the trial court had found that the applicant was liable pay on the basis of the guarantees proffered to the 1

st

respondent, notwithstanding that such guarantees had been discharged; that furthermore, the trial judge failed to appreciate that the bank statements were inconsistent. It was further contended that the subject matter of the intended appeal being a money award will be lost if execution were to be effected and the 1

st

respondent paid; that in the interest of justice, the applicant should be provided an opportunity to ventilate its intended appeal. The applicant also filed written submissions in support of their application.

In an affidavit in reply sworn on 4

th

February 2021 by

Josephine

Gachuru

the 1

st

respondent’s Legal Officer, it was deponed that the applicant and the 2

nd

respondent were directors of the Principal borrower and had executed guarantees and indemnities in favour of the 1

st

respondent in consideration of the loans to the Principal borrower; that contrary to assertions, the applicant regularly received its bank statements, interest rate variations and all general correspondence; that furthermore, the applicant had severally admitted that it owed the outstanding sums of Kshs. 48,949,459.30 as at 30

th

June 2005 to the 1

st

respondent. It was also deponed that the applicant had failed to testify in the suit before the High Court, and went so far as to expressly decline to cross examine the 1

st

respondent; that therefore the intended appeal was not arguable, and there was nothing that would be rendered nugatory in the event that it were to succeed. The replying affidavit was supported by written submissions.

In so far as applications filed under

rule 5 (2) (b)

of this Court’s rules are concerned, the threshold requirements to be satisfied as exemplified in the case of

Republic vs Kenya Anti-Corruption Commission & 2 others

[2009] eKLR,

are that;

“The Court exercises unfettered discretion which must be exercised judicially. The applicant needs to satisfy the Court that first, that the appeal or intended appeal is not frivolous, that is to say that it is an arguable appeal. Second, the Court must also be persuaded that were it to dismiss the application for stay and later the appeal or intended appeal succeeds the results or success could be rendered nugatory.”

As to whether the intended appeal is arguable, the applicant contends that the 1

st

respondent failed to discharge the evidentiary burden of proof to show that the applicant owed the 1

st

respondent the sums demanded. If indeed this be the case, then we are satisfied that the intended appeal is arguable.

As to whether the appeal would be rendered nugatory the applicant case is that the amount of Kshs. 48,949,459.50 is substantial and the 1

st

respondent has not demonstrated that it is entitled to be paid such sums. In this regard, we would begin by observing that the applicant has not specified how the intended appeal would be rendered nugatory in the event the sums were to be paid, or that the 1

st

respondent would not be in a position to refund any amounts paid.

At paragraph 29 of the replying affidavit, the 1

st

respondent has provided an assurance that;

“The 1

st

Respondent Bank is a premier, respectable and well-established Bank with a sizeable market share in the Banking Industry in Kenya. It is therefore capable of settling an award of damages made by the Honourable Court where such an award is held as merited by a Court of requisite jurisdiction.”

On this basis, we are not persuaded that the intended appeal would be rendered nugatory.

As such, with the second limb having failed, the Notice of motion dated 26

th

January 2021 is unmerited, and is dismissed. Costs in the intended appeal.

It is so ordered

DATED AND DELIVERED AT NAIROBI THIS 7TH DAY OF MAY, 2021.

A. K. MURGOR

......................................

JUDGE OF APPEAL

F. SICHALE

..................................

JUDGE OF APPEAL

S. ole KANTAI

...................................

JUDGE OF APPEAL

I certify that this is a true

copy of the original.

Signed

DEPUTY REGISTRAR