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ELCDismissedNot stated in the excerpt· [2024] KEELC 6734 (KLR)

Aspire Limited v Zedka Technical Services Ltd & 2 others (Environment & Land Case 2 of 2021) [2024] KEELC 6734 (KLR)

Environment and Land Court (based on delivery station, Eldoret)
14 October 2024
EOE. OBAGA
2,034 words in judgment
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The bottom line

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Kenya's Environment and Land Court in Eldoret refused to strike out a company's land suit, ruling that a missing company resolution at filing can be fixed later and is not fatal.

What this practically means

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Executive summary

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This ruling by E. Obaga J, delivered in Eldoret on 14 October 2024, determined a Notice of Motion dated 30 April 2024 by the 1st Defendant seeking a finding that the Plaintiff's suit was incompetent and should be struck out, alternatively that a Preliminary Objection dated 6 May 2022 be heard before the conclusion of the plaintiff's case. The applicant, through director Martin Siwa Chemonges, contended that no company resolution authorizing the suit was on the court file when the suit was filed, relying on a Forensic Document Examiner's report showing that the stamp impression on the resolution (dated 11 January 2021) differed from those on other pleadings, suggesting it was later inserted into the file. He also challenged the verifying affidavit for lack of the company seal and alleged the deponent, Nganga Kamau, was not a director, and that the plaintiff's advocate had a conflict of interest having drawn the sale agreement. The respondents maintained a resolution was duly passed and filed, that the CR12 confirmed Nganga Kamau's directorship, and that the conflict-of-interest issue was already determined in a ruling of 20 August 2021 by M. Odeny J. The court accepted, on unrebutted document-examiner evidence, that no resolution was on the record at filing. However, following Leo Investments, Assia Pharmaceuticals, East African Safari Air and Yaya Towers, it held that failure to file a company resolution is not fatal to the suit since unauthorized proceedings may be ratified, and striking out is a draconian remedy of last resort, particularly where the suit had already taken off for hearing with three witnesses. The application was dismissed with costs to the Plaintiff/Respondent.

Key legal issues

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01

Whether failure to file a company resolution at the time of instituting the suit warranted striking out the suit

Holding

No - the failure is not fatal and cannot invalidate the suit; unauthorized proceedings may be ratified

Reasoning

The court accepted the document examiner's evidence that the resolution was inserted into the file after filing, unrebutted by the respondent. However, following Court of Appeal authority, the proper course where authority is unclear is to stay proceedings pending ratification, not strike out. Since a resolution dated 11 January 2021 exists and the suit had taken off for hearing with three witnesses, striking out was not warranted.

p. 4
02

Whether Nganga Kamau had capacity as a director to verify and institute the suit

Holding

Yes - the CR12 filed on 4/10/2023 confirms he is a director of the plaintiff company

Reasoning

The applicant alleged Nganga Kamau misrepresented himself as a director. The court perused the CR12 filed on 4/10/2023 which confirmed his directorship, and Njeri Kamau's affidavit confirmed the resolution of 11 January 2021 authorized him to swear and execute documents relating to the suit.

p. 4
03

Whether the plaintiff's advocate had a disqualifying conflict of interest

Holding

The issue was already determined by M. Odeny J in a ruling of 20/8/2021 dismissing the preliminary objection; the court disregarded the ground

Reasoning

The applicant alleged the plaintiff's advocate drew the sale agreement and was a witness. The court noted this ground had been addressed in a prior ruling which found no outlined prejudice or risk of privileged information being used to the applicant's detriment, and declined to revisit it.

p. 4

Legal principles established

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  • Failure to file a company resolution authorizing a suit at the time of filing is not fatal and does not invalidate the suit; proceedings commenced without authority may subsequently be ratified
  • Striking out a suit is a draconian act that should only be exercised as a measure of last resort

Court orders

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  1. 1.The Application dated April 30, 2024 is dismissed
  2. 2.Costs of the application awarded to the Plaintiff/Respondent

Authorities

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Legislation

  • Civil Procedure RulesOrder 4 rule 4

Cases cited (4)

  • Leo Investments Ltd v Trident Insurance Company Ltd
    (2014) eKLR
  • Assia Pharmaceuticals v Nairobi Veterinary Centre Ltd
    HCCC No. 391 of 2000
  • East African Safari Air Limited v Anthony Ambaka Kegode & Another
    [2021] eKLR
  • Yaya Towers Limited v Trade Bank Limited (In Liquidation)
    Civil Appeal No. 35 of 2000
Jurisdiction invoked
Inherent jurisdiction of the court and civil procedure rules governing striking out of suits (Order 4(4) Civil Procedure Rules cited by parties)

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, "Aspire Limited v Zedka Technical Services Ltd & 2 others (Environment & Land Case 2 of 2021) [2024] KEELC 6734 (KLR)", Case Analysis (2024). Not stated in the excerpt. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/6734/eng@2024-10-14

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