Nassau Limited v Hillingdon Limited [2021] KEELC 3163 (KLR)
The bottom line
#A Malindi court refused to undo a default judgment because the company was properly notified by newspaper advert, and the property had already been sold to someone else.
What this practically means
#Executive summary
#Key legal issues
#Validity of substituted service
The defendant was duly served; substituted service effected by newspaper advertisement pursuant to a court order is as effectual as personal service.
The plaintiff obtained leave on 6th December 2017 for substituted service and published the order in the Standard Newspaper on 18th December 2017. Under Order 5 Rule 17(2) of the Civil Procedure Rules such service is as effectual as personal service. The defendant's claim that its director was abroad lacked documentary support, and the company's other directors and shareholders made no attempt to respond to the advertisement.
Authority of the deponent to the defendant's affidavits
The court was left in serious doubt that David Dadi Dzombo was a director with authority to act for the defendant, since Companies Registry records dated 27th October 2020 did not list him.
The plaintiff produced Companies Registry records showing Dzombo was not a director. He alleged appointment on 14th February 2019, but the resolution was signed by Roberto Mariani (allegedly in Italy) and shareholder Marco Lelli. His late change of dates and reliance on internal compliance undermined his credibility and the court doubted his authority to swear affidavits on the company's behalf.
Tenability of reinstatement orders where property transferred to a third party
Orders of reinstatement were untenable because the apartments had been transferred and registered to Somak Limited, a non-party, whom the defendant had not sought to enjoin.
Both parties acknowledged that the decree had been perfected and the properties registered to Somak Limited. The defendant did not say when it learned of the registration or why Somak was not enjoined. Granting reinstatement would prejudice the rights of a registered third party who had no opportunity to be heard.
Equitable conduct of the applicant
The defendant came to equity with unclean hands, offering no evidence of payment of service charges due under Clause 2.1 of the Sub-Lease Agreement either before or after the suit.
The sub-lease obligated the defendant to pay service charges computed annually, and the parties had agreed in Clause 5 to terminate through court recourse where payments were 30 days in arrears. The defendant offered no evidence of payment of the arrears claimed for October 2014 to April 2017, nor any payment after suit was filed, undermining its entitlement to equitable relief.
Legal principles established
#- A court's discretion to set aside an ex parte judgment must be exercised judicially in light of all facts and circumstances and the respective merits of the parties, to avoid injustice but not to assist a party who has deliberately obstructed or delayed justice.
- Substituted service properly carried out under a court order is as effective as personal service.
Court orders
#- 1.The Notice of Motion dated 21st October 2020 was dismissed
- 2.The defendant was to pay the costs of the application
- Jurisdiction invoked
- Original civil jurisdiction over the suit; application under the Civil Procedure Rules for setting aside ex parte judgment and interlocutory reliefs
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Nassau Limited v Hillingdon Limited [2021] KEELC 3163 (KLR)", Case Analysis (2021). . Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2021/3163/eng@2021-05-28
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.