Marriot Africa International Limited v Margaret Nyakinyua Murigu & 3 others; Ukombozi Holdings Limited (Interested Party) [2022] KEELC 604 (KLR)
The bottom line
#What this practically means
#Executive summary
#Key legal issues
#Locus standi of a non-party to a consent order to challenge it
The 3rd Defendant, though not a party to the consent, has locus standi both as a party to the suit and as a claimed beneficiary of the estate of James Kanyotu
The Plaintiff had itself sued the 3rd Defendant over the suit property, thereby confirming his stake and interest in it. The consent would extinguish the interest in shares held by his late father. Citing the Supreme Court in Michael Osundwa Sakwa, a minimal personal interest suffices for standing. The Plaintiff cannot resile from its own pleadings to defeat the Applicant's standing.
Validity of a consent order excluding parties to the suit
The consent was invalid because it was crafted without notice to or involvement of the 1st and 3rd Defendants and without a board resolution of the 4th Defendant
Order 25 Rule 5 requires the court to hear the parties before recording a compromise. Since the 1st and 3rd Defendants were parties to the suit and the compromise affected the suit property, they were entitled to be heard. Further, the 4th Defendant's directors never met or sanctioned the compromise, and the consent contains anomalies on directorship, tainting it with illegality.
Setting aside a consent order
The consent order is set aside on grounds of fraud and illegality
Applying Brooke Bond Liebig v Mallya and Flora N. Wasike v Destimo Wamboko, a consent judgment can be set aside for fraud, collusion, absence of consensus or public policy. The circumstances under which the impugned consent was crafted and endorsed bespeak of fraud and illegality, including the absence of company resolutions and exclusion of parties.
Referral of documents to the DCI
The court declined to refer the impugned affidavit to the DCI
It is not part of the court's jurisdiction to refer documents for criminal investigation, as that would assist one party to investigate its own case using the court. The burden of proof under Sections 107 and 108 of the Evidence Act lies on the party alleging, and the Applicant may lodge a complaint with the DCI without a court order.
Compliance with discovery notices
The Plaintiff is compelled to honour the discovery notices within 30 days
Under Order 14 and Order 11 of the Civil Procedure Rules, a party served with discovery notices must respond or state reasons for non-compliance. The documents sought concern the transfer of the suit land and are relevant to the effective determination of the suit, ensuring a level playing field.
Legal principles established
#- What gives locus standi is a minimal personal stake or interest in the matter
- A consent judgment may be set aside only on limited grounds such as fraud, collusion, absence of consensus or public policy
- An order made in the presence and with the consent of counsel binds all parties but cannot be varied or discharged unless obtained by fraud or collusion
- A suit or compromise for and on behalf of a company requires a company resolution authorising it
- The purpose of discovery is to level the litigation field and enable fair disposal of proceedings
Court orders
#- 1.The Application dated 20th September 2021 is allowed in terms of prayers 3 and 5 thereof
- 2.The consent order dated 28th June 2021 and adopted on 14th July 2021 is set aside, vacated and/or rescinded
- 3.The Plaintiff is ordered to honour and/or comply with the Discovery Notices served upon it within thirty (30) days, in default the 3rd Defendant/Applicant shall be at liberty to apply
- 4.Costs of the Application awarded to the 3rd Defendant/Applicant, to be borne by the Plaintiff and the 2nd Defendant
- Jurisdiction invoked
- Inherent powers of the court and Order 45 and Order 25 Rule 5 of the Civil Procedure Rules, 2010
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Marriot Africa International Limited v Margaret Nyakinyua Murigu & 3 others; Ukombozi Holdings Limited (Interested Party) [2022] KEELC 604 (KLR)", Case Analysis (2022). . Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2022/604/eng@2022-03-10
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.