Daniel Kipsang Tanui v (Company whose directors are Naomi Wambui Ndiangui and Solomon Njuguna Chege)
The bottom line
#A Nairobi court allowed a landlord to sue company directors personally for property damage because they treated the company's apartment as their own home.
What this practically means
#Executive summary
#Key legal issues
#Interpretation of 'enjoin' versus 'join'
The court found that despite the use of 'enjoin', the Plaintiff's intention was to 'join' the parties, and the mislabel was not a ground for dismissal.
The Defendant argued, citing Black's Law Dictionary 11th Edition, that 'enjoin' means to legally prohibit or restrain by injunction, distinct from 'join'. The court accepted the distinction but held that parties and advocates commonly use 'enjoin' for 'join'; the Plaintiff's intention was clear and the Defendant understood and responded to the substance of the application.
Whether directors can be joined personally / piercing the corporate veil
The veil of incorporation was disregarded; the directors were to be joined as Defendants in their personal capacity because they treated company property as their personal residence.
The court applied Salomon v Salomon and the exceptions recognized in Halsbury's Laws, Bolton Engineering, De Ruiters Roses and Mombasa Bricks & Tiles. The directors had, in an earlier sworn affidavit, admitted residing in the suit premises with their family, then later denied residence. The company could not inhabit property; the directors were the brains behind the company and used it as an extension of themselves, justifying piercing the veil.
Whether leave to amend the Plaint should be granted
Leave to amend the Plaint was granted under Section 100 of the Civil Procedure Act and Order 8 Rule 3 of the Civil Procedure Rules.
Amendments should be freely allowed before judgment where necessary to determine the real question in controversy. The Plaintiff sought to capture the names of the new parties and plead special damages arising from the directors' occupation. The court found no bad faith and no prejudice to the Defendant or proposed Defendants.
Legal principles established
#- A company is a legal person distinct from its members, shareholders and directors (veil of incorporation), but the veil may be pierced in exceptional cases where the company is used as a mask by its directors.
- Courts in Kenya will pierce the corporate veil where the company is a mere instrumentality or alter ego of the director and adherence to separate personality would sanction a fraud or promote injustice.
- Amendments to pleadings should be freely allowed before judgment where necessary to determine the real question in controversy and where no prejudice is caused.
Court orders
#- 1.Leave granted to the Plaintiff to join Naomi Wambui Ndiangui and Solomon Njuguna Chege as 2nd and 3rd Defendants
- 2.Leave granted to the Plaintiff to amend the Plaint dated 16th September 2020 in terms of the draft amended Plaint filed, within 14 days of the date of the Ruling
- 3.Costs of the application to be in the cause
- Jurisdiction invoked
- Not expressly invoked in the excerpt; proceedings before the Environment and Land Court in respect of Title No. IR. 146380 L.R. No. 209/20672 (suit premises)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Daniel Kipsang Tanui v (Company whose directors are Naomi Wambui Ndiangui and Solomon Njuguna Chege)", Case Analysis (2024). Not stated in the excerpt. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/867/eng@2024-02-15
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.