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ELCDismissedNotice of Motion dated 12th April 2021 (suit number not stated in judgment)· [2021] KEELC 1500 (KLR)

Gatongu Farmers Co. Ltd v Commissioner of Lands & another; Gattongu Farmers (Interested Party) [2021] KEELC 1500 (KLR)

Environment and Land Court
21 October 2021
DOD. O. Ohungo
1,743 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~7 min to read original · ~4 min brief

The bottom line

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A Kenyan court refused to undo a consent order, ruling the dispute was really an internal company management fight for the Companies Act, not a simple court mistake.

What this practically means

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Executive summary

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This is a ruling of the Environment and Land Court at Kakamega (D. O. Ohungo, J) on the plaintiff's Notice of Motion dated 12th April 2021 seeking review and variation of the court's order of 20th November 2019, made by consent of all parties, allowing the joinder of an Interested Party. The plaintiff, through its secretary Mary Wanjiru Njenga, contended that there was an error apparent on the face of the record because Gatungo and Gattungo Farmers Co. Ltd were one and the same entity, and that the joinder application was a treacherous attempt by Eliud Muya Kariuki, a former director allegedly ousted in 1988, to reinsert himself into the company's affairs. Kariuki, deposing for the Interested Party, denied the ouster, alleged the plaintiff's faction had unlawfully changed the company's name, and asserted members' interests as registered proprietors who had developed and buried kin on the suit parcels. The court, applying Section 80 of the Civil Procedure Act and Order 45 Rule 1, held that a reviewable error must be self-evident and require no elaborate argument; the alleged mistake concerned internal management and directorship disputes of incorporated companies to be resolved under the Companies Act, 2015 or in the High Court. Further, as the joinder order was a consent order with contractual effect, it could only be set aside on grounds justifying setting aside a contract, such as fraud or collusion, none of which was established. The application was dismissed with costs to the Interested Party.

Key legal issues

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01

Whether a mistake alleged to make the plaintiff and Interested Party one and the same entity is an error apparent on the face of the record

Holding

No - the alleged mistake relates to internal company management and directorship disputes requiring elaborate argument, not a self-evident error

Reasoning

The court applied National Bank of Kenya v Ndungu Njau, holding that an error for review must be self-evident without elaborate argument. The alleged duplication of parties arises from disputes within incorporated companies over management and directorship, which cannot be self-evident and should be resolved under the Companies Act, 2015 or in the High Court under that statute.

p. 2
02

Whether the consent order of 20th November 2019 could be varied or set aside on the grounds advanced

Holding

No - a consent order has contractual effect and can only be set aside on grounds justifying setting aside a contract, such as fraud or collusion, which were not demonstrated

Reasoning

Relying on Flora N. Wasike v Destimo Wamboko and Njagi Wanjeru & Company Advocates v Nairobi City County, the court held that an order made by consent cannot be varied or set aside unless obtained through fraud, collusion or a reason enabling a court to set aside an agreement. The applicant's arguments did not meet these criteria.

p. 3

Legal principles established

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  • An error or omission relied on for review must be self-evident and not require elaborate argument to establish
  • A consent order has contractual effect and can only be set aside on grounds which would justify setting a contract aside
  • Disputes over management and directorship of an incorporated company are not reviewable errors on the face of the record and should be resolved under the Companies Act, 2015 or the High Court under that statute

Court orders

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  1. 1.Notice of Motion dated 12th April 2021 dismissed with costs to the Interested Party

Authorities

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Legislation

  • Civil Procedure ActSection 80
  • Civil Procedure RulesOrder 45 Rule 1
  • Companies Act2015

Cases cited (3)

  • National Bank of Kenya Limited v Ndungu Njau
    (1997) eKLR
  • Flora N. Wasike v Destimo Wamboko
    [1988] eKLR
  • Njagi Wanjeru & Company Advocates v Nairobi City County
    [2019] eKLR
Jurisdiction invoked
Section 80 of the Civil Procedure Act and Order 45 Rule 1 of the Civil Procedure Rules (review jurisdiction)

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, "Gatongu Farmers Co. Ltd v Commissioner of Lands & another; Gattongu Farmers (Interested Party) [2021] KEELC 1500 (KLR)", Case Analysis (2021). Notice of Motion dated 12th April 2021 (suit number not stated in judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2021/1500/eng@2021-10-21

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