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ELCPartially Allowed· [2019] KEELC 1707 (KLR)

Speedway Technical Company Limited v Ecobank Kenya Limited [2019] KEELC 1707 (KLR)

Environment and Land Court
26 September 2019
AOA. O. Ombwayo
438 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court summoned company directors to explain why they ignored a court order, warning they could face jail and company property seizure.

What this practically means

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Executive summary

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The applicant moved the court by Notice of Motion dated 30 April 2019 seeking that Fredrick Obado Opio, Mary Adhiambo and Eric Ochieng Obado, directors of Speed Way Technical Company Limited, be cited for contempt and committed to jail, that the company's properties be sequestrated, or alternatively that the directors (including Tom Oyugi) be summoned to show cause why they should not be so cited. The application arose from a certificate of costs taxed at Kshs. 268,721 on 13 December 2017 and an order of 22 January 2019 requiring the directors to attend court for examination of the company's books of accounts in aid of execution of the decree. The applicant alleged that the directors were served but deliberately refused to comply, conduct said to be scandalous and an affront to the court's dignity. In a brief ruling delivered on 26 September 2019, A. O. Ombwayo J noted the respondents' affidavit asserting that the underlying suit had been dismissed for want of prosecution on 31 July 2011, but found the respondents served with the hearing notice and satisfied that they had failed to attend court. The court granted prayer 3 only, summoning the named directors to appear and show cause why they cannot be cited for contempt and punished by committal to jail and sequestration of the company's property, fixing the show-cause hearing for 17 October 2019, with costs to the applicant. Immediate committal and sequestration were not granted at this stage.

Key legal issues

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01

Whether to issue an order to show cause for contempt against non-attending directors

Holding

Granted. The respondents were served but failed to attend, justifying an order that they be summoned to show cause why they cannot be cited for contempt, with committal and sequestration reserved as potential punishments.

Reasoning

The applicant sought committal and sequestration for breach of an order of 22 January 2019 requiring the directors to attend for examination of the company's books in execution of a taxed certificate of costs. The court noted, per the applicant's supporting affidavit, that the suit had been dismissed for want of prosecution on 31/7/2011, yet the respondents had been summoned and failed to attend. Finding service of the hearing notice proved and non-attendance deliberate, the court exercised its discretion in favour of the intermediate step of a show-cause summons rather than immediate committal, and awarded costs to the applicant.

p. 1

Legal principles established

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  • A party served with a court order and a hearing notice but who fails to attend may be summoned to show cause why they should not be cited for contempt

Court orders

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  1. 1.Prayer 3 of the Notice of Motion dated 30/4/2019 granted: Fredrick Obado Opio, Mary Adhiambo, Eric Ochieng Obado and Tom Oyugi summoned to appear in court to show cause why they cannot be cited for contempt of court and punished by committal to jail and sequestration of the company's property
  2. 2.Notice to show cause issued for hearing on 17/10/2019
  3. 3.Costs to the applicant
Jurisdiction invoked
Not expressly stated; court exercising contempt/examination-of-judgment-debtor powers in execution of a taxed bill of costs

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Speedway Technical Company Limited v Ecobank Kenya Limited [2019] KEELC 1707 (KLR)", Case Analysis (2019). . Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2019/1707/eng@2019-09-26

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.