Vania Investments Pool Limited v Capital Markets Authority & 8 others (Civil Appeal 92 of 2014) [2014] KECA 452 (KLR)

The Court endorsed the principle that judicial review is a remedy of last resort where a statutory appeal mechanism exists. The third respondent's recourse to the Tribunal and then to the High Court for mandamus showed a plausible option. The appellant moved to court only after the statutory 15-day window for challenging CMA decisions had expired, so its delay compounded the failure to exhaust the statutory procedure. Grounds one and two therefore failed.

The Court held that the regulations governing takeovers are not cast in stone; Section 11(w) empowers the Authority to do all acts incidental to its objectives, akin to the oxygen rule, permitting departure from procedural timelines where justice so requires. The timetable applied equally to all bidders, no party was discriminated against, and the process was open. The alleged breach could not have impelled the grant of leave. Ground three failed.

The threshold for leave is a prima facie arguable case, but leave is not granted as a matter of course. Because the application here was heard inter partes rather than ex parte, the judge was entitled to hear all parties and consider their material, restraining himself from definitive findings on merits. The Court found the judge applied the prima facie standard and did not exceed what was necessary to conclude leave was undeserved. Ground six failed.

The Court held that derogations creating the impression that the securities market is unpredictable, and its rules manipulable in favour of some bidders, would damage public confidence. Open-ended schedules and failure to adhere to timelines would prejudice other shareholders whose shares were suspended from trading during the takeover. Granting leave would cause hardship to third parties and diminish investor confidence in the capital markets.