Gaichanjiru Estate Limited & 3 others v Njuguna & 9 others (Environment and Land Case E020 of 2025) [2025] KEELC 7738 (KLR)

RULING 1. This ruling is on the notice of motion dated 24-4-2025. The motion which is brought under Sections 1A, 1B and 3A of the Civil Procedure Act and Orders 40 rules 1-3 and 51 rule 1 of the Civil Procedure Rules seeks the following residual orders. 4. Pending the hearing and determination of this suit, the 6th and 7th Defendants whether by themselves, their servants and/or agents be restrained from selling, charging, transferring or otherwise dealing with L.R. No. Kakuzi/Kirimiri/Block 10/703, suit land. 5. Pending the hearing and determination of this suit, the 1st to 5th , 8th and 9th Defendants whether by themselves, their servants and/or agents be restrained from selling, charging, subdividing, transferring or otherwise dealing with any subdivision arising from the original L.R. No. 4743 Kakuzi, L.R. No. Kakuzi/Kirimiri/Block 10/536 and 622. 6. That costs of this application be provided for. 2. The motion is based on eleven (11) grounds and is supported by an afidavit sworn by the 4th Plaintifi dated 24-4-2025. The gist of the motion is as follows. One, the 2nd to 4th Plaintifis were at all the material times the valid and lawful directors of the 1st Plaintifi which is the owner of the suit land. Two, the 2nd and 4th Defendants had lawfully subdivided the original suit land L.R. No. 4743 Kakuzi into four(4) major portions which included Kakuzi/Kirimiri/Block 10/536 and 622. Three, in the year 2008, the 1st to 5th Defendants unlawfully and without having been elected unlawfully and illegally took over the management of the 1st Plaintifi. They also fraudulently and illegally leased the 109 acre cofiee portion in Kakuzi/Kirimiri/Block 10/536 to one Alex Maina at a consideration of Kshs. 1 Million per year. Around the year 2015, the same Defendants caused amalgamations and subdivisions of the initial parcels Kakuzi/Kirimiri/Block 10/536 and 622 resulting to among others L.R. Nos. Kakuzi/ Kirimiri/Block 10/703 (40.58 Ha)and 701 (2 Ha) which they allegedly set aside for school though in the name of Danson Maina. Four, on 1-7-2016 the 1st to 5th Defendants fraudulently and illegally sold L.R. No. Kakuzi/Kirimiri/Block 10/703 to Jabali Construction Kenya Limited the 6th Defendant. On 13-7-2016, the 6th Defendant fraudulently charged the title to L.R. No. 703 to Equity Bank the 7th Defendant to secure a sum of Kshs. 90 Million. The same Defendants have caused further and illegal subdivision of the original title L.R. No. 4743 Kakuzi. Five, through this suit, the Plaintifis seek for an order that the 8th and 9th Defendants herein to cancel all the titles for and the subdivisions made on the original L.R. No. 7473 from the year 2007 and revert to the initial subdivisions being Kakuzi/Kirimiri/ Block 10/536, 622 and 464 and all the plots previously allocated to the members before 2007. Six, the Plaintifis were in the process of issuing title deed to the 630 members of the 1st Plaintifi when they were violently removed and chased from ofice by the 1st to 5th Defendants yet the said Defendants were not elected and had no mandate of the shareholders. In the company records, it is the 2nd to 4th Plaintifis who are recognized as the bona fide directors of the 1st Plaintifi. Finally, the 1st to 5th Defendants are involved in fraudulent activities and the court should allow the prayers as per the notice of motion. 3. The motion is opposed by the 1st to 5th Defendants and the 1st Defendant has sworn a replying afidavit dated 30-6-2025 in which he responds as follows. Firstly, the 2nd and 4th Plaintifis lack locus standi to bring this suit because none of them is a director of the 1st Plaintifi. The 2nd and 3rd Defendants were removed as directors of the 1st Plaintifi on 20-9-2008 and the 3rd Plaintifi is no longer a shareholder of the 1st Plaintifi having sold his shares to the 6th Defendant in the year 2015. Secondly, the 1st to 5th Defendants were confirmed by the minutes of the extraordinary AGM held on 24-1-2009 and https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/7738/eng@2025-11-11 2

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reconfirmed on 26-2-2011. They were mandated by the members to oversee the management and control of the 1st Plaintifi’s assets and this included selling, leasing or selling a portion of the estate including Block 10/703. Finally, the 1st Plaintifi is in the process of winding up since there are no assets and liabilities left in the name of the Company. 4. In addition to the replying afidavit, the 1st to 5th Defendants have filed a notice of preliminary objection dated 23-6-2025 which is based on two grounds. 1. That the 2nd – 4th Plaintifis lack the locus standi to present this suit together with the application since they are not directors of the 1st Plaintifi and that the legal and known directors have not authorized them to institute the suit on their behalf. 2. That the 4th Plaintifi is a stranger and not an agent or oficial of the Company hence cannot purport to have the authority of the company to swear the afidavit and institute the suit on its behalf. 5. The only submissions filed within the timeline of 15-10-2025 are those by the counsel for the 6th Defendant. No other submissions are on record at the time of writing this ruling in late October (21-10-2025). Counsel for the 6th Defendant has correctly submitted that since the reliefs sought are injunctive, the only issue for determination is whether the Plaintifis have attained the threshold for the grant of an order of injunction. Secondly, I am expected to decide on the preliminary objection raised by the 1st to 5th Defendants. 6. Starting with the preliminary objection, I find that it is not well anchored on suficient material to warrant the striking out of the entire suit. At the heart of the dispute is who between the 2nd to 4th Plaintifis and the 1st to 5th Defendants are the legitimate directors of the 1st Plaintifi. Each side claims to be the legitimate ofice holders. At this preliminary stage it is not possible to decide who the legitimate ofice holders are. This is because the Defendants have not filed suficient evidence before the Court. In the case of Oraro vs Mbaya[2005] it was held that “ a preliminary objection must be on a pure point of law raised on the assumption that the facts pleaded by the opposing party are correct. It cannot be used where there is a need to investigate facts, or where the objection is founded on disputed facts that require evidence. Where a court needs to investigate facts, a matter cannot be raised as a preliminary point. Anything that purports to be a preliminary objection but in fact deals with contested facts, or seeks evidence for its support, is not a true preliminary objection as a matter of legal principle”. In this case, evidence is required to determine which of the two factions is the legitimate ofice holder. Such evidence will have to be adduced at the trial because it is not obvious to me as to who are the legitimate ofice holders of the 1st Plaintifi. 7. Coming back to the injunction, I find that the Court should consider the principles laid down in the case of Giella vs. Cassman Brown 1973 EA 358. The first principle is a prima facie case with a probability of success. I find that the Plaintifis have established this because of the dispute over the leadership of the Company. Both sides claim to be the legitimate directors. If it turns out that the Plaintifis are the legitimate directors and the Defendants continue dealing with the land before this case is resolved then this will be prejudicial to the Plaintifis. Secondly, the Plaintifis stand to sufier irreparable loss if the suit land is alienated while the case is pending determination. Finally, the balance of convenience tilts in favour of maintaining the status quo so that the substratum of the suit is preserved pending the final outcome of the suit. https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/7738/eng@2025-11-11 3

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8. Consequently and for the reasons already given, I am inclined to allow the notice of motion dated 24-4-2025 which I hereby do in terms of prayers 4 and 5. Costs in the cause. DATED, SIGNED AND DELIVERED VIRTUALLY AT MURANG’A THIS 11TH DAY OF NOVEMBER, 2025. M.N. GICHERU JUDGE. Delivered online in the presence of; Court Assistant – Mwangi Njonjo Plaintifi’s Counsel – Mr. Gacheru 1st to 5th Defendants’ Counsel – Miss Mwangi 8th to 10th Defendants’ Counsel – Miss Ngira Miss Chege for the 6th Defendant https://new.kenyalaw.org/akn/ke/judgment/keelc/2025/7738/eng@2025-11-11 4

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