KENYA LAWS ONLINE: Kenya civil procedure law: Post litigation proceedings

After the litigation process is over, there is the post litigation process.Even though the trial has by now run its course, the civil dispute is not yet resolved. There are two outstanding issues under Kenya law still to be decided: firstly, the question of enforcement and then that of costs. The legal representatives may still need to execute on the judgment, either by serving documents via the sheriff or by managing the logistical arrangements for payment. They must also settle the issue of the final figure of the legal costs. This involves the winning party drafting a bill of costs, which will be taxed. Only once the judgement debt and costs awarded have been settled—that is to say, paid by the losing party—can it be said that the matter is over.

Enforcement of judgments

Obtaining judgment in one’s favour is not necessarily the final step in the litigation process. In many cases the party against whom the judgment is granted (the “judgment debtor”) will willingly comply with the judgment by, for example, paying an amount of money or performing a specific act in accordance with the terms of the judgment. It may happen, however, that the debtor is recalcitrant and unwilling to comply with a judgment. In such a case, it will be necessary to distinguish between a judgment in terms of which the court orders the judgment debtor to perform some act, known as a judgment ad factum praestandum, and a judgment which orders the judgment debtor to pay a sum of money, known as a judgment ad pecuniam solvendam (like an order to pay damages arising out of a delict). The remedy of the creditor is to follow a process known as “execution,” which is set out in specific rules of the High Court and Magistrate’s Court. Such procedures provide a mechanism by which court orders may be enforced, and ensure the effectiveness and integrity of the process of judicial decision-making.
In general terms, the process of execution under Kenya law entails the attachment and sale by public auction, by the sheriff of the court, of the property of the judgment debtor in order to realise money and thereby satisfy a money judgment. The property may be moveable, immovable or incorporeal. This procedure under Kenya law amounts to an individual debt-collecting (execution) procedure, since it can operate effectively only where the debtor has sufficient assets to meet the amount of the judgment debt. If the debtor cannot pay the debt and has no executable assets, the debtor is technically insolvent. In such an instance, creditors will have to revert to other debt-collecting devices, such as an application for the sequestration of the estate of the debtor, in the case of a natural person (as provided by the Insolvency Act), or an application for the liquidation or winding-up of the judgment debtor, in the case of a juristic person (as provided by the Companies Act or the Close Corporation Act).
The following requirements under Kenya law must be complied with before it may be said that execution has been levied:

the issue of a valid writ of execution;
the attachment of the judgment debtor’s property by the sheriff, unless the debtor pays the amount of the writ and costs; and
the sale by the sheriff, through public auction, of the property attached.

Property that may be attached in execution

The primary principle in execution under Kenya laws is that it can be carried out only once judgment is granted, and then only by means of the issue of a warrant of execution. Generally execution takes place first against the defendant’s movables, and thereafter against any immovable property.

Movable, immovable and incorporeal property

As a general rule under Kenya law, the judgment creditor is entitled to as much of the property of the judgment debtor as satisfies the judgment, plus costs. The property attached may be either movable property, immovable property or incorporeal property, although the mode of attachment of each is different.
Execution under Kenya law will take place first against the debtor’s movables, and only thereafter against any immovable property. Therefore, where a writ against the movables of the judgment debtor is issued and served, and insufficient attachable movables are found, the writ must be re-issued against the debtor’s immovable property.
Immovable property under Kenya law may, however, be declared to be specifically executable at the time of judgment where there is a prayer to that effect. In such a case, the immovable property may be attached in the first instance without the necessity of attempting first to execute against moveable property. This often occurs in the context of provisional-sentence proceedings.
The property must belong to the judgment debtor. In the context of movable and immovable property, this means that ownership in the property must vest in the debtor. Therefore, even in circumstances where property has been sold by the debtor to a third party, but ownership has not yet been transferred, because delivery has not yet taken place, the property will still be subject to attachment.
Where the ownership in the movable or immovable property vests in the debtor, but a third party has a real right in respect of that property, such as a pledge (in the case of movable property) or a mortgage (in the case of immovable property), as a general rule that property may nevertheless be attached and sold in execution, subject to certain conditions. The third party, however, will have a preferential right to the proceeds.
Incorporeal property, whether movable or immovable, may also be attached. Such property may take the form of a lease, a bill of exchange, a promissory note, a bond or other security for the payment of money. It may also take the form of an interest in a partnership, shares in a company, or a member’s interest in a close corporation.
Any debts which are owed or accruing from a third person to the judgment debtor may be attached and executed upon by way of a garnishee order. In terms of such an order, the third person, known as the “garnishee,” will be ordered to pay the debt, or part thereof, to the judgment creditor, rather than to the judgment debtor.
A specific procedure is laid down for obtaining execution in this manner. Money or bank notes, as a form of moveable property, may also be seized.

Property exempt from attachment and execution

Certain property belonging to the judgment debtor may not be attached and sold in execution. Under Kenya law the following items are exempt from attachment and execution:

necessary beds and bedding and wearing apparel of the person against whom execution is levied, or any member of his family;
necessary furniture, other than beds, and household utensils, insofar as they do not exceed in value the amount determined by the Minister;
stock, tools and agricultural implements of a farmer, insofar as they do not exceed in value the amount determined by the Minister;
any food or drink sufficient to meet the needs of such person, and the members of his family, for one month;
tools and implements of trade, insofar as they do not exceed in value the amount determined by the Minister;
professional books, documents or instruments necessarily used by the debtor in his profession, insofar as they do not exceed in value the amount determined by the Minister; and
arms and ammunition of which the debtor, in terms of any law, is required to have possession as part of his equipment.

Writ or warrant of execution

Under Kenya law the first step in the procedure for attachment and execution is the valid issue of a document known in the practice of the High Court as a “writ of execution,” and in the Magistrate's Court as a “warrant of execution.” Although the terminology is different, the purpose of the documents is essentially the same.
A writ or warrant of execution is issued by the registrar of the High Court or the clerk of the Magistrate’s Court. It instructs the sheriff of the court to attach and sell, by public sale, so much of the judgment debtor’s property as is necessary to satisfy the judgment debt, plus the costs of the execution process. Thereafter, it is handed to the sheriff to execute.
A writ or warrant may be issued only after judgment. It is therefore a prerequisite for the issue of a writ or warrant that there be a judgment against the debtor.
In the High Court, there does not appear to be any rule prescribing when, after judgment, a writ may be issued. It would also appear that there is no prerequisite at common law that the creditor should wait a reasonable time after judgment before issuing a writ so as to give the debtor an opportunity to satisfy the judgment.
In the Magistrate’s Court, the only time requirement appears in MCR 36(7), which provides that a warrant of execution shall not be given before the day following that on which the judgment is given without leave of the court applied for at the time of granting the judgment.

High Court

Magistrate's Court

The process for the execution of any judgment for ejectment, the delivery of property (movable or immovable), or the payment of money, shall be by warrant issued and signed by the clerk of the court.

Attachment and execution against movables

Upon receipt of the warrant, the clerk must proceed to the home or place of employment of the debtor, and request satisfaction of the writ.
With regard to the attachment of the property, certain specific provisions of the rules of the Magistrates' Courts bear mention:

The sheriff must show the original warrant to the debtor, and must leave a copy thereof on the premises. Although this is not specifically provided for in the High Court, the practice there is the same.
Where the sheriff is in doubt as to the validity of any attachment, the sheriff may require the party suing out the process in execution to provide security in the form of indemnification. In particular, security must be granted where the judgment creditor is executing a judgment under circumstances where summons has not been served on the defendant personally, unless the defendant has entered an appearance to defend or the notice of attachment has been given to the debtor personally. The position in the High Court is different: The sheriff will attach the property. Where, however, any claim is made by another person to any property seized, the sheriff will, before taking the property into custody, request the execution creditor to provide indemnity to the sheriff’s satisfaction against any loss or damage incurred as a result of the seizure.
Even if the property is insufficient to satisfy the debt fully, the sheriff must nevertheless proceed to attach and make an inventory and valuation of those items in part-execution of the warrant. Although this is not specifically provided for in the High Court, the practice is the same; the sheriff will attach property even if it is insufficient to satisfy the judgment in full.
If necessary for purposes of execution of the warrant, the sheriff may open any door on any premises, or of any piece of furniture, even if such opening is refused, and even if there is nobody present representing the judgment debtor. If necessary, the sheriff may use force for such purpose. Although this is not specifically provided for in the High Court, the practice is the same.

The sheriff must hand a signed copy of the inventory to the execution debtor, or leave a copy of the inventory on the premises. The inventory must be annexed to a notice of attachment. In the High Court, the practice is not significantly different.

After attachment of the items, the sheriff must notify the execution creditor of such attachment by sending the return and the inventory to the execution creditor or his attorney. As a general rule, the sheriff must leave the movable property, other than money, specie or documents, on the premises and in the possession of the execution debtor. The property under Kenya laws may be removed in two circumstances:

Where, upon issue of the warrant of execution, the execution creditor or his attorney is able to satisfy the clerk of the court of the desirability of removing the property immediately, the property may be removed. The clerk will endorse the warrant with permission for immediate removal. The attorney will then, when sending the warrant to the sheriff, also send a letter to the sheriff with instructions to remove immediately the articles to be attached.
Where there is no such instruction, the execution creditor or his attorney, after receiving notification of the attachment, may instruct the sheriff in writing either to remove the property to a place of security or leave it upon the premises in the charge and custody of the debtor or another person acting on the sheriff’s behalf.

The execution creditor’s attorney must obtain a date for sale from the sheriff. The date of the sale must be at least fifteen days after the attachment. The property must be sold at or near the place where it was attached, or to which it has been removed. The property will then be sold by the sheriff through public auction, or with the approval of the magistrate, by an auctioneer or other person so appointed by the sheriff.
Thereafter, it is the responsibility of the creditor, after consultation with the sheriff, to prepare a notice of sale, and to send two copies thereof to the sheriff, so that one copy may be affixed to the notice board or door of the court, and the other copy near the place where the sale is to take place. This must be done ten days before the sale.
If the sheriff is of the opinion that the items are worth more than Ksh 3,000, the sheriff will require the creditor to publish the notice of sale in a local newspaper. The advertisement must be published at least ten days prior to the sale. A copy of the edition of the paper wherein the advertisement is published must be furnished to the sheriff at least one day prior to the sale.
On completion of the sale, the sheriff must attach to the return a “vendue roll,” showing details of the property sold, the prices realised, the names and addresses of the purchasers (where known), and an account of the distribution of the proceeds.

Attachment and execution against immovable property

Under Kenya laws in the case of immovable property, the warrant of execution must be delivered to the sheriff of the district in which the immovable property is situated. The sheriff effects the attachment by serving the notice of attachment and the warrant of execution on

the owner of the property;
the registrar of deeds;
all registered holders of bonds (other than the execution creditor) registered against the property attached;
the occupier of the property, if the property is in the occupation of some person other than the owner; and
the local authority in whose area the property is situated.

The sheriff will then send the original warrant of execution, together with the return of service, to the creditor’s attorney.
After the attachment, the sheriff must ascertain and record whether the said property is subject to any claim preferent to that of the creditor. If that is the case, the sheriff must notify the creditor of the existence of any such claim. Having received such notification, the creditor is obliged, to cause a notice of the intended sale in execution to be served personally upon the preferent creditor; alternatively, the execution creditor must make application to the Magistrate’s Court of the district in which the property is situated in order to obtain a direction as to what steps must be taken to bring the intended sale to the notice of the preferent creditor.
No immovable property subject to any preferent claim shall be sold in execution unless

the proceeds of the sale are sufficient to satisfy the claim of such preferent creditor in full; or
the preferent creditor confirms the sale in writing, in which event the preferent creditor shall be deemed to have agreed to accept such proceeds in full settlement of his claim.

The sheriff will then set a day and a place for the sale of the property. The date of the sale must be at least a month after the service of the notice of attachment. The sale must take place in front of the courthouse in the district in which the attached property is situated, or at such place as the magistrate may determine.
The sale under Kenya law must be by public auction without reserve.
It is not necessary for the property to be sold by the sheriff. The execution creditor, or any person having an interest in the proper realisation of the property, may by notice to the sheriff, within fifteen days after attachment, and subject to certain conditions, require that such property be sold by an auctioneer in the ordinary course of business, and may in such notice nominate the auctioneer to be employed.
Thereafter, it is the responsibility of the execution creditor to prepare a notice of sale and the conditions of sale. Such a notice of sale must contain

a brief description of the property;
its situation;
the time and place of the sale; and
the material conditions of sale.

Thereafter the execution creditor must publish the notice of sale in a newspaper circulating in the district in which the property is situated, as well as in the Government Gazette not less than five days, and not more than fifteen days, before the date of sale. A photocopy of each of the published notices must be furnished to the sheriff as proof of publication.
At least ten days prior to the sale, the sheriff must

send, by registered post, a copy of the notice of sale to each judgment creditor who has caused the immovable property to be attached, and to each mortgagee whose address is known; and
affix one copy of the notice of sale on the notice board of the Magistrate’s Court of the district in which the property is situated.

At least twenty days prior to the sale, the execution creditor prepares the conditions of sale, which must include a condition for payment by the purchaser of any interest due to a preferent creditor from the sale of the property to the date of transfer. The execution creditor will then deliver two copies of the conditions of sale to the sheriff, and one copy to each person entitled to notice of the sale. Any interested party may then apply for a modification of such conditions of sale.
After the sale, the sheriff prepares a plan of distribution of the proceeds of the sale. After the property is transferred, and the plan of distribution of the proceeds has lain open for inspection, the necessary pay-outs are made to the creditors in accordance with the plan of distribution.
An attachment in respect of immovables is valid for one year from the date of attachment.

Interpleader proceedings

It may happen that a third party, other than a judgment debtor, lays claim to property seized by the sheriff. As has already been explained, the sheriff will proceed with the attachment notwithstanding the fact that a third-party claimant alleges ownership of the property. In such an event, an interpleader may be the most appropriate course of action under Kenya laws.
The custodian may, in terms of an interpleader, oblige any two persons laying claim to the property to fight out their claims among themselves, without putting the custodian to the expense and trouble of an action or actions.
Although not unique to the execution process, the interpleader occurs most frequently in this context because it provides an obvious mechanism by which the sheriff as custodian, who has seized or is about to seize property as part of the execution process, is spared the risk of becoming involved in conflicting claims which may potentially arise in the exercise of his statutory duty.
When considering the relevant rules of the High Court, and the appropriate section and rules of the Magistrate’s Court, one should not lose sight of the fact that interpleader proceedings may occur in a context other than execution.

Magistrates' Courts

Where a third-party claimant lays claim to property attached or about to be attached by the sheriff, or to any proceeds of property so attached and sold in execution, the sheriff must give notice of such claim to the execution creditor.
Under Kenya laws the execution creditor has ten days after the receipt of the notice in which to admit the claim, in which event the execution creditor will not be liable for any costs, fees or expenses afterwards incurred, and the sheriff may withdraw from possession of the property concerned.
Where the third-party claimant makes a claim in respect of property attached by the sheriff, and the execution creditor has not admitted the claim within the ten-day period referred to above, the sheriff must sue out an interpleader summons in the prescribed form, calling on the third-party claimant and the execution creditor to appear on the date specified in the summons, to have the claim adjudicated upon.
The third-party claimant must, not less than ten days before the date of the hearing specified in the summons, lodge with the sheriff an affidavit in triplicate, setting forth the particulars of the claim and the grounds thereof. The sheriff will then forward a copy of the affidavit to the execution creditor, and another copy to the execution debtor.
On the date of the hearing, the parties must appear in court. The court will adjudicate the dispute between the claimants. It may

order the third-party claimant to state, orally or in writing, on oath or otherwise (as the court may deem expedient), the nature and particulars of the claim;
order that the matters in issue be tried on a day to be appointed for that purpose; or
try the matters in dispute in a summary manner.

Where the matter is tried, the normal rules of a trial action apply. The court may make such order as to any additional expenses of execution occasioned by the claim, and for payment of costs incurred by the application or sheriff, as may be just.
If a third-party claimant fails to appear in court on the stipulated day, or fails to deliver an affidavit in the stipulated time, or within such further period as the court may allow, or appears but fails to comply with any order made by the court after an appearance, the court may make an order barring the third party from making any further claim in respect of the subject matter of the dispute.
From a practical point of view, it is usually advisable to proceed by way of the interpleader.

Debt collection

The process of execution after gaining a judgment is costly and time-consuming. Because the majority of cases involve the payment of accounts for goods provided, or for services rendered, and for which the defendant has no valid defence, a procedure is provided whereby judgment may be obtained in this kind of instance without first issuing a summons and following the full summons procedure.
Debtors may be summonsed before the court to face an inquiry into their failure to pay the debt. Following such an inquiry, the court may issue various orders:

an order to pay the debt in whole or in instalments;
a writ of execution; or
an emoluments-attachment order.

Recovery of debts in terms of Chapter VIII of the Act

There is a procedure whereby a creditor may obtain judgment without the issue of a summons. If the debtor admits liability, the creditor may proceed to gain an order against the debtor.
If the creditor proceeds by way of summons, and the debtor consents to judgment, certain provisions also provide for obtaining an appropriate judgment.
A registered letter of demand may be sent by the attorney acting for a creditor to a debtor who is liable for the payment of the debt (“any liquidated sum of money due”) claimed in the letter.
The debtor pay the debt upon receipt of the letter, the creditor shall be entitled to recover the fees and costs prescribed in the rules for a registered letter of demand, provided that the amount of such fees and costs was stated in the letter of demand. No specific format is prescribed for the letter of demand; this is unlike the position in regard to summons.
The letter of demand must be sent by registered post by an attorney to the debtor. In terms of rule 4B, the letter must contain particulars of the nature and amount of the claim.
Where there has been judgment for the payment of a sum of money, and the judgment debtor has made a written offer to pay in instalments, and where such offer is accepted by the judgment creditor or his attorney, the judgment creditor may apply to the clerk of the court for an order that the debtor pay such amount in accordance with the offer. Such an order is deemed to be an order for the purpose of launching the following procedures:

Notice to summon debtor to appear before court

The debtor may be summoned to appear before the court if the judgment or order has not been complied with for a period of ten days from

the date on which it was given;
the date on which an instalment became payable; or
the expiry of a period of suspension ordered in terms of section 48(e).

The notice calling upon the debtor to appear before the courting chambers must be in a printed form. It must indicate the date of judgment or order, as well as the amount of the judgment and the balance of the capital, interest, costs and collection fees which the defendant has undertaken to pay and which remains due on the date of issue or reissue of the notice.
This notice is supported by an affidavit (or affirmation) by the judgment creditor or a certificate by his attorney in which the following averments are made:

the date of the judgment or the date of the expiry of the period of suspension
that the judgment or order has remained unsatisfied for a period of ten days from the date on which it was given or became payable,
in what respect the judgment debtor has failed to comply with the judgment, the amount in arrears and outstanding balance on the date on which the notice is issued;
that the judgment debtor has been advised by registered letter of the terms of the judgment, or of the expiry of the period of suspension, and of the consequences of his failure to satisfy the judgment, and that a period of ten days has elapsed since the date on which the letter was posted; and

When the original judgment or order for payment of the judgment debt, has been given in any court other than the court of the district in which the inquiry is held, the clerk of the court may not issue the notice calling on the debtor to appear before the court until a certified copy of the judgment has been lodged with him.
Any alteration in the notice to the debtor must be initialled by the judgment creditor or his attorney, and by the clerk of the court before issue or reissue.
The clerk may not issue the section 65A notice until it is shown, from the minutes of the proceedings, that the debtor was present or represented when judgment was given, or a warrant of execution was served on the debtor personally—unless the judgment creditor or his attorney demonstrates that the debtor has been notified by registered letter of the terms of the judgment or of the expiry of the period of suspension ordered and a period of ten days has elapsed since the posting of the letter.
Where the court is satisfied that the debtor has knowledge of the and has failed to appear, or where the debtor fails to appear on a postponement date, or where he has failed to remain in attendance, the court may issue a warrant of arrest to bring the debtor before a competent court to conduct an enquiry.
Under Kenya laws,a person so arrested should, as soon as reasonably possible, be brought before the court within the district which that person was arrested. He may be detained at a police station pending the court appearance.
Instead of arresting the debtor (but only if the creditor consents), the sheriff may hand the debtor a notice calling upon him to attend court.
A wilful refusal or failure to appear constitutes an offence, making the debtor liable to a fine or to imprisonment for a period not exceeding three months
Section 65A makes provision throughout for the summonsing of a juristic person, represented by a director or officer.

Procedure when debtor appears before court in camera

When the debtor appears before the court in camera on the return day mentioned in the notice, he gives evidence under oath or affirmation as to his financial position.
The court permits examination or cross-examination of the judgment debtor in relation to all matters affecting his financial position and his ability to pay the judgment debt and costs, and also in relation to his failure to do so.
The court hears such further evidence as may be adduced (orally or by affidavit, or in such other manner as the court may deem just), and as is material to the determination of the judgment debtor’s financial position, his ability to pay the judgment debt and his failure to do so. Witnesses may be summoned for the purpose of giving such evidence.
Below are the factors under Kenya law which the court must take into consideration in determining the ability of the debtor to pay the debt due. These factors are

the nature of his income;
the amounts needed by him for his necessary expenses and those of the persons dependent upon him; and
the amount in periodical payments that he is obliged to make in terms of an order of court, agreement or otherwise in respect of his other commitments

The court may, in its discretion, refuse to take account of periodical payments that a judgment debtor has undertaken to make in terms of instalment sale transactions for the purchase of goods not exempted from attachment, or goods which, in the opinion of the court, cannot be regarded as household requirements.
If, at the hearing, the court is satisfied that the judgment debtor has movable or immovable property which may be attached and sold in order to satisfy the judgment debt, or part of it, the court may

authorise the issuing of a warrant of execution against such movable or immovable property, or such part of it as the court may deem fit; or
authorise the issuing of such a warrant, together with an order for the payment of the judgment debt, in periodical instalments.

If it appears to the court that there is a debt due to the judgment debtor which may be attached, the court may authorise the attachment of that debt in terms of that section.
If it is apparent from the evidence that, after receipt of the notice to appear in court, the judgment debtor made a written offer to pay the judgment debt in instalments or otherwise, or that the debtor is able to pay the debt in reasonable instalments, the court may order him to pay the judgment debt and costs in specified instalments, and may also authorise the issuing of an emoluments attachment order.
The further hearing of the matter is thereupon postponed. The proceedings may again be placed on the roll by the judgment creditor or his attorney by notice delivered or posted at least ten days before the day appointed in such notice for the hearing.
The court may in any event postpone the proceedings at any time in the presence of the judgment debtor or, in the case of a juristic person, in the presence of the director or officer of the debtor, to such date as the court may determine.
When postponing the proceedings, the court informs the judgment debtor or the director or officer and may order the judgment debtor, etc., to produce such documents as the court may specify at the hearing on the date determined by the court. The court may, in addition, stipulate such conditions as it deems fit.
As far as the costs of the appearance at the hearing in chambers are concerned, the rule applies that the judgment debtor will be ordered to pay the costs unless it appears at the hearing that the debtor has made an offer to settle the judgment debt in instalments that the court considers reasonable, or unless it appears that he has notified the judgment creditor that he was not able to make an offer, and the court finds this to be true. If it emerges that the creditor refused the offer, the court may order the judgment creditor to pay those costs, including the loss of wages suffered by the debtor through having to appear in court in connection with the proceedings.
The court may suspend, amend or rescind its order. If the debtor or his representative was not present in court at the time the order was made, the judgment creditor or his attorney is obliged to advise him forthwith, by registered post, of the terms of the order and of the consequences of his failure to satisfy it.

Section 65 and administration orders

The court may postpone the hearing if the judgment debtor lodges with the court an application for an administration order prior to or at the time of the hearing.
If a debtor has not lodged an application for an administration order with the court before or at the time of the hearing of the proceedings, and it appears at the hearing that the judgment debtor has other debts also, the court considers whether all of the judgment debtor’s debts should be treated collectively. If the court is of the opinion that they should be so treated, it may, with a view to granting the administration order, postpone further hearing of the proceedings to a date determined by the court, and order the judgment debtor

to submit to the court a full statement of his affairs; and
to cause a copy of the statement to be delivered to each of his creditors at least three days before the date appointed for the further hearing.

If it appears that the judgment debtor’s total debts do not exceed R50,000, the court may grant the administration order in respect of his estate, and stay further proceedings, but may grant the judgment creditor the costs already incurred in connection with such proceedings.

Emoluments attachment orders

A distinction must be drawn between a garnishee order and an emoluments attachment order:

A garnishee order under Kenya law is a method used to attach a debt due to the judgment debtor.
An emoluments attachment order is regarded as part of the procedure for the collection of debt. In this instance, the court orders the judgment debtor’s employer to make regular monthly deductions from the debtor’s salary, and to pay them to the judgment creditor.

An emoluments-attachment order will only be granted if

the debtor has consented thereto in writing, or the court has so authorised; or
the judgment creditor has sent a registered letter to the debtor at his last known address, informing him of the judgment debt and the amount outstanding, and that an emoluments attachment order will be issued ten days from the posting of the letter. The judgment creditor must place an affidavit before the court setting out the outstanding amount of the judgment, and how the specific instalment and cash have accumulated from the date of the judgment, and the balance owing.

When the judgment creditor issues an emoluments attachment order out of any court other than the one in which the judgment was obtained, a certified copy of the judgment against the debtor must accompany the affidavit.
If the court authorizes the issuing of an emoluments-attachment order ,the order must be issued in the form prescribed by the rules, and must contain sufficient information, including the identity number, work number or date of birth of the judgment debtor, to enable the garnishee to identify the judgment debtor.
The emoluments-attachment order must be signed by the judgment creditor or his attorney, and by the clerk of the court, and served on the garnishee (the employer) by the sheriff in the manner prescribed.
The order is executed against the garnishee as if it were a court judgment, subject to the right of the garnishee and the debtor, or any other interested party, to dispute the existence or validity of the order or the correctness of the balance claimed.
The deductions are made monthly, commencing at the end of the month following that in which the emoluments attachment order was served upon the garnishee.
The garnishee under Kenya law is entitled to commission of up to five per cent of all amounts paid over by him in terms of the order. This commission is deducted from the amount paid to the creditor.
If it is shown that the debtor, after satisfaction of the order, will not have sufficient means for his own and his dependants’ maintenance, the court will rescind the order or amend it in such a way as to affect only the balance of the debtor’s emoluments over and above such sufficient means.
The court may in any event, on good cause shown, suspend or amend or rescind the emoluments attachment order on such conditions as it may deem just.
Should the debtor leave the service of the garnishee before the debt has been paid in full, he must forthwith advise the creditor of the name and address of his new employer. The creditor may cause a certified copy of the order to be served on the new employer, together with a certificate specifying the balance outstanding on account of the debt. The new employer is thereupon bound by the order, subject to his right to dispute the existence or validity of the order and the correctness of the balance claimed.
Whenever any debtor to whom an emoluments order relates leaves the service of the garnishee before the debt has been paid in full, and becomes self-employed or is employed by someone else, he is, pending the service of the emoluments order upon his new employer, again obliged to comply with the order made by the court which provides in essence that he must pay the debt and costs in specific instalments as set out in the order.

Debt-collecting procedure in regard to certain classes of debtor

Debtors against whom judgment has been granted in the High Court

Where judgment for the payment of money has been given by a division of the High Court, the judgment creditor may file with the clerk of the court a certified copy of that judgment and an affidavit specifying the amount still owing and how it has been arrived at.
The judgment then has all the effects of a judgment of that Magistrate’s Court, even though the amount of the judgment may exceed the jurisdiction of the court. The procedure generally followed for the collection of debts in the Magistrates’ Courts is thereafter followed in collecting that amount.
The debtor is entitled to dispute the correctness of the amount specified in the affidavit.

Juristic persons

Where a judgment debtor is a juristic person, either a director or an officer of the juristic person may be called upon as a representative of the juristic person, in his personal capacity, to appear before the court to show cause why he should not be ordered to pay the judgment debt in instalments.
It should be noted that, wherever the legislation alludes to a “judgment debtor,” it refers also to the director or officer of the juristic person. For all practical purposes, the juristic person is placed in the same position a debtor who is a natural person.
The court may, at the request of the debtor, at any stage of the proceedings, if the director or officer ceases to be a director or officer of the juristic person, or absconds, replace the director or officer with any other person who at the time of the replacement is a director or officer of the juristic person; the proceedings then continue as if there has been no replacement.

Administration orders

Under Kenya law an application for an administration order is described as a modified form of insolvency proceedings.
In principle the procedure provides for a rescheduling of a debtor’s debt without sequestrating the debtor’s estate.
In terms of this order, a court will assist the debtor by appointing an administrator to take control of the debtor’s financial affairs, and to manage the payment of debts due to creditors.
In terms of the order, the debtor has an obligation to make regular payments to the administrator. After deducting necessary expenses and a specified remuneration determined by tariff, the administrator will in turn make a regular distribution in weekly or monthly instalments, or otherwise out of such received payments to all creditors.

Application for administration order

Where a debtor possesses a regular income, and where the burden of debt is reasonably manageable, the debtor may obtain an administration order from the court of the district in which he resides, carries on business or is employed, in the following circumstances:

where he is unable immediately to satisfy a judgment obtained against him in court;
where no judgment has yet been obtained against the debtor, but he has insufficient cash on hand to meet his financial obligations, and in addition lacks sufficient realisable assets capable of satisfying his debts.

An administration order under Kenya law may be granted against a debtor who applied for such an order during an in camera inquiry into the debtor’s financial position. The application for an administration order enjoys preference, so the court will suspend the in camera hearing until the application for an administration order has been disposed of.
The procedure for applying for an administration order is based on an application, together with a prescribed statement of affairs, in which the debtor affirms on oath that the names of the creditors and the amounts owed to them, and all other statements or declarations made in the statement, are true.
The application is lodged with the clerk and delivered personally, or by registered post, to the creditors at least three calendar days before the hearing.
The true basis for the application is the fact that the debtor is unable to pay his debts as they become due.
The clerk must, in accordance with the Act, assist an illiterate debtor in preparing the application. In practice it is usual for an attorney to assist the debtor in preparing the application.

Hearing of the application

The application is heard before a magistrate in a section 65 court, and in the presence of the debtor or an appointed legal representative, as well as the creditors and their respective legal representatives.
All the debts listed in the statement of affairs are deemed to be proved, subject to any amendments the court may make, except where a creditor objects to a listed debt, or the court rejects or requires the debt to be substantiated by evidence.
Similarly, when the debtor objects to a creditor’s claim, the court will require the creditor to prove the claim. The court, or any creditor or legal representative, may question the debtor with regard to

assets and liabilities;
present and future income, including the income of a spouse;
standard of living and the possibility of economising; and
any other relevant matter.

Contents of administration order

The content of an administration order takes a prescribed form. It must set out

that the debtor’s estate has been placed under administration;
that an administrator has been appointed; and
the amount the debtor is obliged to pay.

The order must specifically state a weekly or monthly amount to be paid over to the administrator by the debtor. This amount is calculated by taking into account the difference between the future income of the debtor and certain prescribed “necessary expenses.”
Unless the court or the Act provides otherwise, the cost of the becomes a first claim against the moneys controlled by the administrator.
In futuro debts—that is to say, debts which become due and payable in the future, including mortgage bonds and assets subject to credit agreements—are excluded from the administration order. This means that the court will exclude a certain amount of money from the weekly or monthly payments made to the administrator for the purpose of allowing the debtor to make periodical payments in terms of a credit instalment sale agreement or existing maintenance or mortgage-bond obligations.
Where the administration order provides for the payment of instalments out of future income, the court shall authorise the issue of an emoluments or garnishee attachment order to facilitate payments by the debtor.

Costs

Under Kenya laws,the term “legal costs” refers to the costs that are payable in respect of the fees of any legal practitioner who has acted on behalf of a party, and any expenses incurred in respect of such items as telephone calls, faxes, photocopies or payments to the sheriff of the court for service of a document.
These costs are payable by a client to his attorney

in terms of an account rendered by the attorney to the client; or
in terms of an agreement between the two.

Each party is responsible to its own attorney for payment of the attorney’s fees, and for payment of monies disbursed by the attorney on behalf of the client, including the fees of any advocate who may have been briefed in the matter—irrespective of whether the client won or lost the case.
In civil matters, each party usually claims an order for recovery from the other party of the costs paid to his own attorney. Therefore, in almost every civil matter, the court is required, when granting judgment, to consider

whether an order in respect of costs should be made; and,
if so, what the order should be.

As a result of the Contingency Fees Act, it is now possible for attorneys to charge on a contingency basis. The attorney and client may agree that the attorney will charge the client only if he succeeds in the case. If the client loses, he is not charged for fees by his own attorney. Owing to the risk involved, the Act allows the attorney to charge a larger amount than he would be entitled to charge if the matter were conducted on a normal basis.
A practising attorney may not share his professional fees with anyone other than another practising attorney. The allowance to the other attorney may not, directly or indirectly, exceed a third of the fees charged. An unqualified person may not receive remuneration from a practitioner for work done where he is not permitted by law to carry out such work.

General principles

The court which hears a matter has a wide discretion as to costs, but it is expected that the court will exercise this discretion in accordance with well-established principles.
The most important of these principles is that, where a party has been substantially successful in bringing or defending a claim, that party is generally entitled to have a costs order made in his favour against the party who was unsuccessful. This principle is often expressed by the saying that “the costs follow the outcome of the case.” The result of such an order is that the losing party will have to pay a substantial portion of the costs incurred by the winning party, along with his or her own costs.
Other principles under Kenya laws which the civil courts frequently apply, in conjunction with this main principle, are

that a successful party may be deprived of costs if there is good reason for this;
that matters which are separate and distinct usually carry their own costs;
that judgment on the merits is usually a prerequisite for a costs order, but that orders made in respect of interlocutory procedures may include an appropriate costs order;
that small or partial successes may carry an appropriate or commensurate award of costs;
that a successful application for the granting of an indulgence does not carry a costs order;
that a party who unnecessarily causes costs must bear those costs; and
that, in exceptional circumstances, a party may be ordered to pay costs on a more punitive scale than would normally have applied (an attorney-and-client scale, for example, instead of party-and-party scale).

A party may, in exceptional circumstances, be ordered to pay his counterparty’s cost. Such circumstances include fraud, dishonesty, reckless, malicious or frivolous motives and grave misconduct.
It is clear from the principles above that equity is an important consideration.
In recent years, the Constitutional Court, the Land Claims Court and the Labour Courts have adopted a new principle: that persons should not be deterred from enforcing their rights because they fear that they will have to pay their opponent’s costs, on top of their own, if they do not succeed.
In the High Courts and the Magistrates’ Courts, the principle that the loser pays the winner’s costs is still applied in almost all cases.
In the Constitutional Court, the Land Claims Court and the Labour Courts, judgments are often given with no order as to costs, or with an order that each party should pay its own costs.
Parties to divorce proceedings in these courts should pay their own costs, unless there is good reason for the court to order otherwise.
Another well-established principle is that, because the making of an order of costs involves the exercise of a judicial discretion, a court of appeal will not readily interfere with an order of costs made by the court of first instance.
The power of interference on appeal is limited to cases

of vitiation by misdirection or irregularity; or
marked by the absence of grounds on which a court, acting reasonably, could have made the order in question.

A court may also reconsider an award of costs if the question of costs, or of the particular award, was not argued before it, without the need for the principles of rescission to be applied.

Terminology

Party-and-party costs

Party-and-party costs are those which are necessarily incurred for the purposes of litigation (charged according to the tariff set out in the Rules of Court). This does not include all costs; only those which were necessary and properly incurred in order to obtain justice and to protect the client’s rights. Where a court simply makes an order of costs against one party in favour of another, this is deemed to be a party-and-party order of costs.
For example, Cameron institutes a claim against Rodney. The court eventually decides in Cameron’s favour. This means that Rodney will have to pay the account of Cameron’s attorney in respect of all costs that were necessary in order to obtain justice and to protect Cameron’s rights. If Cameron telephoned his attorney to inquire about the progress of the case more often than was reasonably necessary, he will not be able to recover the costs of those telephone calls from Rodney.

Attorney-and-client costs

An attorney-and-client order of costs entitles the party in whose favour it is made to recover more from the opposing party than he would be able to recover on a party-and-party order of costs.
In a broad sense, attorney-and-client costs include all costs that the attorney is entitled to recover from the client.
In a narrow sense, they include those costs and charges and expenses, between attorney and client, which ordinarily the client cannot recover from the other party.
If, for example, a court granted judgment in favour of Armand against Corbin, with costs on the attorney-and-client scale, Armand would be entitled to recover from Corbin all the costs that Armand’s attorney would justifiably have been able to recover from Armand.
Attorney-and-client orders are often made because the losing party agreed to pay such costs in an agreement prior to litigation. A court may also make an attorney-and-client order to penalise a party which the court believes has acted improperly.

Attorney-and-own-client costs

Attorney-and-own-client costs are the remuneration to which an attorney is entitled, in terms of an agreement or mandate with the client which stipulates that the attorney is to be remunerated according to a predetermined rate (hourly, for example).
This order of costs therefore entitles the party in whose favour it is made to recover even more than could be recovered in terms of an attorney-and-client costs award.
Magistrates’ Courts are not entitled to grant attorney-and-own-client costs.
If a court granted judgment in Debbie’s favour, against Margo, with costs on the attorney-and-own-client scale, and Debbie and her attorney agreed that the attorney could charge, for example, an hourly fee for consultations, which is twice as high as that prescribed by the tariff, Margo will have to pay that agreed fee.

Costs de bonis propriis

Under Kenya laws,this is an order that the costs be paid by the attorney, instead of by the client. A court will make this kind of order where it believes that it was the attorney’s fault that certain legal costs were incurred.
A court may also order costs de bonis propiis against a person who acts in a representative capacity, such as an executor of a deceased estate, or a trustee of an insolvent estate. Such costs are usually granted if there is a substantial deviation from the responsibilities of the person’s office—where, for example, the person has acted mala fide, negligently or unreasonably.

Wasted costs

Costs are “wasted” when the services for which those costs are charged are of no use to the parties to the action.
Where, for example, a party sets a matter down for trial, and then postpones the matter, the relevant notice of set-down is a useless procedure, and the costs related to it are wasted costs.

Costs reserved

A costs-reserved order entails that the issue of which of the parties is to pay the costs of a particular procedure will be decided at a later stage, usually at the end of the matter, when the court can adjudicate the issue in the light of everything that has occurred in course of the proceedings.
The court usually reserves cost for argument and determination by a trial court when the liability for costs of an interim application would be more effectively determined by the trial court.

Costs in the cause

This means that the costs of preliminary or interlocutory proceedings are included in the total costs of the court case.
The party who must pay the costs in respect of the main case then also carries the costs of the preliminary or interlocutory procedure in respect of which costs were made costs in the cause.

Costs of the day

This refers to costs occasioned to a party in respect of proceedings that occurred on a specific day, usually wasted costs occasioned by a postponement.

All costs

Such an order refers to party-and-party costs, unless the court indicates otherwise.

No costs order

Where a court expressly indicates “no order as to costs,” each party is liable for its own costs.
Where the High Court fails to deal with costs at all, it is not finalised. Any one of the parties may then approach the court for a costs order.
Where no order is made as to costs in the Magistrates’ Courts, such costs will be costs in the action.

Taxation of bills of cost

A bill of costs is an itemised account reflecting all the charges, including fees and disbursements, made by an attorney. The fees charged in a party-and-party bill of costs must be in accordance with the tariff of fees and charges set out in the schedule to the Rules of Court. Briefly, a bill of costs should indicate

the date on which the work was done;
the item in respect of which costs are charged (which items must be listed in chronological order, and should be numbered);
the number of folios or pages involved, and the period of time spent in relation to each item;
a precise description of each item; and
fees for each item, charged in accordance with the applicable tariff.

The party who has been ordered to pay costs requires the party who is claiming the costs to have the bill taxed by the taxing master of the court.
Before a bill of costs may be taxed, the party who has drafted the bill must request a date for taxation from the taxing master.
After such a date has been allocated, the party who drafted the bill must send a notice of taxation to the other party, to inform him where and when the taxation will occur.
Both parties are entitled to be present at the taxation, and to put argument to the taxing master in favour of or against the charges being taxed.
The taxing master should not proceed to the taxation of any bill of costs unless he is satisfied that the party liable to pay has received due notice as to the time and place of such taxation, together with notice that he is entitled to be present. Such notice is not necessary, however,

when the party against whom costs have been awarded has not appeared at the hearing, either in person or through his legal representation;
if the person liable to pay costs has consented in writing to taxation in his absence; or
for the taxation of writ and post-writ bills.

Where costs or expenses are awarded to any party by the court (otherwise than by a judgment in default of the defendant’s entry of appearance to defend, or on the defendant’s consent to judgment before the time for such appearance has expired), the party to whom such costs or expenses have been awarded must deliver a bill of such costs or expenses. Such party must give at least five days’ notice of taxation for an hour to be fixed, generally or specially, by the clerk of the court, and may include in such bill all payments that have necessarily and properly been made by him.
During the taxation, the attorney of the party against whom the costs order was granted, and who is thus liable to pay the account, will bring to the attention of the taxing officer all items that in his opinion should not appear on such account.
For example, it may be argued that unnecessary telephone calls were made. The attorney who submitted the bill will then have to furnish reasons to the taxing master why those telephone calls were made, and furnish proof thereof by notes of telephone conversations on file.
When the taxation of the bill is finalised, the taxing master allocates the amount that is payable in terms of the taxed bill of costs, puts his stamp on it, and signs it. This “endorsement” is known as the taxing master’s allocatur. The taxed bill then has the effect of a court order; if the party who is liable for payment of same fails to pay the bill of costs, payment may be enforced by means of a warrant of execution.