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ELCPartially AllowedNot stated in the judgment· [2026] KEELC 1696 (KLR)

Ghanima Limited & another v Nguli & 2 others (Sued as chairman, Secretary and treasurer of Casamia Lukenya Residents Association) (Environment and Planning Civil Case E006 of 2025) [2026] KEELC 1696 (KLR)

Environment and Land Court
24 March 2026
NMN.A. MATHEKA
1,830 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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If your Kenyan contract has an arbitration clause, courts will send your dispute to arbitration — so raise that clause early or risk losing the argument.

What this practically means

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Executive summary

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The Defendants raised a preliminary objection contending that the court lacked jurisdiction because the suit offended the doctrine of exhaustion — the agreements between the parties contained arbitration clauses providing that disputes be referred to an arbitrator whose decision would be final and binding — and sought that the suit be struck out with costs. The Plaintiff opposed, arguing that the Defendants had filed a statement of defence dated 4th March 2026 thereby submitting to the court's jurisdiction, and that under Section 6 of the Arbitration Act and Rule 2 of the Arbitration Rules an application for reference to arbitration must be made by summons in the suit, which had not been done. Matheka, J. set out the definition of a preliminary objection from Black Law Dictionary and the Mukisa Biscuits formulation, holding that a preliminary objection raises a pure point of law and may be brought at any time before the final conclusion of the case. The court examined Section 6(1) of the Arbitration Act, noting it is mandatory but subject to exceptions where the arbitration agreement is null and void, inoperative or incapable of being performed, or where no dispute exists. Guided by Article 159(2)(c) of the Constitution promoting alternative dispute resolution, and authorities including Blue Limited vs Jaribu Credit Traders and Eunice Soko Mlagui, the court found the Defendants raised the objection at the time of entering appearance and that valid arbitration clauses existed in the agreements (clause 6.10 of the sample sub-leases and special condition X in a sample agreement). The court held that the arbitration clause did not oust its jurisdiction but obliged it to enforce the agreement. The preliminary objection was found merited; the proceedings were stayed and the parties referred to arbitration, with no interim orders issued and costs in the cause.

Key legal issues

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01

Definition and proper scope of a preliminary objection

Holding

A preliminary objection raises a pure point of law argued on the assumption that all facts pleaded by the other side are correct; it cannot be raised if any fact has to be ascertained, and it may be brought at any time before the final conclusion of the case

Reasoning

The court adopted the Black Law Dictionary definition and the classic Mukisa Biscuits formulation. It held that a preliminary objection should ideally be filed at the earliest opportunity but can be brought at any time before the final conclusion of the case, and found the Defendants' objection properly brought before the court.

p. 2
02

Whether the suit should be stayed and referred to arbitration under Section 6(1) of the Arbitration Act

Holding

Yes — the Defendants raised the objection at the time of entering appearance, a valid arbitration clause exists in the agreements, and the court stayed the proceedings and referred the parties to arbitration

Reasoning

Section 6(1) of the Arbitration Act is mandatory but limited by exceptions (null and void, inoperative or incapable of being performed, or no dispute). The court perused the file, found the preliminary objection raised at the time of entering appearance, verified an arbitration clause (clause 6.10 of the sample sub-leases; special condition X in the sample agreement), and found the clause valid and enforceable, prompting referral to arbitration and stay of proceedings.

p. 4

Legal principles established

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  • A party seeking to invoke an arbitration agreement must do so not later than the time of entering appearance; where parties consensually agree on arbitration, the courts are obliged to give effect to that agreement
  • The presence of a valid arbitration clause does not oust the court's jurisdiction but allows the court to enforce the agreement by referring the matter to arbitration and staying the proceedings

Court orders

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  1. 1.The preliminary objection is merited
  2. 2.Stay of proceedings in this court
  3. 3.Referral of the parties to arbitration
  4. 4.For the avoidance of doubt, no interim orders have been issued
  5. 5.Costs to be in the cause

Authorities

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Legislation

  • Arbitration ActSection 6
  • Arbitration ActSection 6(1)
  • Arbitration ActSection 7(1)
  • Arbitration RulesRule 2
  • Constitution of KenyaArticle 159(2)(c)

Cases cited (4)

  • Mukisa Biscuits Manufacturing Co. Ltd vs West End Distributors Ltd
    (1969) E.A. 696
  • Attorney General & Another vs Andrew Mwaura Githinji & another
    (2016) eKLR
  • Blue Limited vs Jaribu Credit Traders Limited
    Nairobi (Milimani) HCCS No. 157 of 2008
  • Eunice Soko Mlagui vs Suresh Parmar & 4 Others
    (2017) eKLR
Jurisdiction invoked
Article 159(2)(c) of the Constitution as read with Section 6(1) of the Arbitration Act, No. 4 of 1995

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, "Ghanima Limited & another v Nguli & 2 others (Sued as chairman, Secretary and treasurer of Casamia Lukenya Residents Association) (Environment and Planning Civil Case E006 of 2025) [2026] KEELC 1696 (KLR)", Case Analysis (2026). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/1696/eng@2026-03-24

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