Unda v Pentagon Security Services Limited (Cause E102 of 2018) [2025] KEELRC 2365 (KLR)
The bottom line
#Kenyan court held company directors personally liable for their company's unpaid judgment debt after they ignored a court summons to explain why the debt remained unsettled.
What this practically means
#Executive summary
#Key legal issues
#Whether the corporate veil of the Judgment Debtor should be lifted and its directors held personally liable for the decretal sum
Yes. The directors, though served with court process, failed to attend court for examination as directed and did not oppose the application; an adverse inference was drawn and the veil was lifted, making them jointly and severally liable for the decretal sum and costs.
The Court held that questions of execution and satisfaction of a decree fall to the court that issued it under section 34 of the Civil Procedure Act. A company is a distinct legal persona, but the veil may be disregarded where its protection is abused. The directors were summoned for examination under Order 22 Rule 35 but deliberately failed to appear or produce books of account. Their non-attendance and non-opposition warranted an adverse inference that examination would have confirmed the decree-holder's assertions, justifying lifting the veil.
Costs of the application
Costs follow the event; the directors were made liable for the costs of the application together with the decretal sum.
The Claimant was compelled to bring the application because the Respondent failed to satisfy a valid decree, incurring additional legal expenses and delaying realisation of the fruits of judgment. The Court therefore included the costs of the application in the joint and several liability imposed on the directors.
Legal principles established
#- A registered company is a legal persona distinct from its members, but a court may disregard the separate personality in appropriate circumstances to fix liability elsewhere
- The court executing a decree may lift the corporate veil and hold directors personally liable where they fail to attend examination and produce the company's books despite being served
Court orders
#- 1.The corporate veil of the Judgment Debtor Company is lifted
- 2.The Directors named in the notice of motion application (Nazir Hussein Ahmed and Azmna Farid Ahmed) shall be liable jointly and severally to settle the decretal sum of Kshs 185,551.92 and the costs of the application
- Jurisdiction invoked
- Section 34(1) of the Civil Procedure Act and Order 22 Rule 35 of the Civil Procedure Rules
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Unda v Pentagon Security Services Limited (Cause E102 of 2018) [2025] KEELRC 2365 (KLR)", Case Analysis (2025). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/2365/eng@2025-07-31
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.