Mainoya v Kongoacheke Enterprises Limited

in 2018, do not automatically clothe her with authority to act for the company under the Companies Act in the absence of a conrmed grant and formalized share transfers. 3. Substantively, the Applicant maintains that the court was satised with the service leading to the exparte judgment, asserts that he has been in peaceful occupation of the land for over twelve years, and distances himself from the 2012 Machakos judgment by claiming he is a stranger to it due to a discrepancy in the defendant's name therein, which was recorded as "Joseph Tomate Mainoya". 4. In a rejoinder via a Supplementary Adavit sworn on 22nd May 2026, Connie Nkirote Ngachu claries her legal capacity by deposing that while the 80% majority shareholder, Felishian Gichuru Ngachu, is deceased, the 20% minority shareholder, Billy Meshack Muguna, is alive and fully authorized the ling of the application. She asserts that as a co-administrator of the deceased's estate, she possesses a direct proprietary interest and derives authority to protect those shares under Article 9(viii) of the company's Articles of Association, further providing written authority from her coadministrator to swear the adavits. 5. Addressing the substantive merits, the deponent dismisses the Respondent’s name variation argument as a deliberate and misleading attempt to evade the nality of the Machakos judgment, maintaining that he is the exact same individual who was sued in 2012 and that the previous judgment conclusively armed the company's proprietary rights. Directions 6. The application was canvassed by way of written submissions, submissions of which have been duly considered in the writing of this ruling. Analysis and Determination 7. I have considered the Notice of Motion dated 16th April 2026, the Grounds of Opposition, the Replying Adavit and the Supplementary Adavit, together with the submissions on record. The issues for determination are, rstly, whether the application is competent in view of the objection to the authority of the deponent; secondly, whether the judgment of 18th December 2025 was regularly entered; and, thirdly, whether the Applicant has demonstrated sucient grounds for setting aside the judgment and being granted leave to defend. 8. On the rst issue, the objection to the competency of the application is not, in my view, determinative. A company is a separate legal person, and its aairs are ordinarily conducted through its duly authorized organs. However, the mere absence of a formal company resolution does not, without more, render proceedings instituted on behalf of a company a nullity. Section 35(1)(b) of the Companies Act, 2015 provides that a contract may be made on behalf of a company “by a person acting under its authority, express or implied.” The High Court in Busienei v Lizano Limited (Civil Appeal E078 of 2021) [2025] KEHC 4483 (KLR) has similarly observed that a corporation may be represented by its authorized ocers and that such authority ‘need not be in writing or even led. It could be implied, by conduct of the parties’. 9. In the present case, Connie Nkirote Ngachu has explained her capacity as a co-administrator of the estate of the deceased majority shareholder and has exhibited authority from the surviving shareholder. Whether that authority ultimately establishes the company's substantive proprietary claim is a dierent question from whether she has demonstrated sucient authority to move the Court at this stage. I therefore decline to strike out the application solely on that ground. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5892/eng@2026-09-24 2

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10. The central question is whether the judgment of 18th December 2025 was regularly obtained. The Applicant contends that service by advertisement in the Star newspaper was ineective because the company had a physical presence near the suit property. Order 5 Rule 17 of the Civil Procedure Rules, 2010 permits substituted service where the Court is satised that summons cannot be served in the ordinary manner. The Rule provides: “ Where the court is satised that for any reason the summons cannot be served in accordance with any of the preceding rules of this Order, the court may on application order the summons to be served by axing a copy thereof in some conspicuous place in the courthouse, and also upon some conspicuous part of the house, if any, in which the defendant is known to have last resided or carried on business or personally worked for gain, or in such other manner as the court thinks t.” 11. The use of substituted service is therefore not, by itself, irregular. Indeed, the Environment and Land Court recently in Chairperson, Secretary and Treasurer of Diani Scheme Resource Centre CBO v Thiga (Environmental and Land Originating Summons E008 of 2023) [2025] KEELC 3310 (KLR) recognized a newspaper advertisement as a permissible mode of substituted service where ordered by the Court. The question is whether the mode of service ordered and eected in this particular case aorded the Applicant a reasonable opportunity to participate in the proceedings. 12. That question cannot be answered merely by the assertion that the company had a physical presence near the suit property. The relevant consideration is whether the Court was satised, on the material then before it, that ordinary service could not reasonably be eected and whether the substituted service was carried out in accordance with the order made. If the adavit of service and the court record demonstrate compliance with the order for substituted service, the judgment cannot be described as irregular merely because another mode of service might, with hindsight, have been more eective. 13. The applicable distinction was restated by the High Court in Gitau & another vs Gathige; Thigiti (Interested Party) (Civil Appeal E331 of 2023) [2025] KEHC 529 (KLR), where the Court, citing James Kanyiita Nderitu & Another v Marios Philotas Ghikas & Another [2016] eKLR, stated: “ From the outset, it cannot be gainsaid that a distinction has always existed between a default judgment that is regularly entered and one, which is irregularly entered.” 14. The same decision reiterated that where judgment is regular, the Court considers, among other matters, the reason for default, the delay, whether the proposed defence raises triable issues, the prejudice to the respective parties and the interests of justice. 15. I therefore nd that the Respondent/Applicant has not established, merely by pointing to the existence of a physical presence near the suit property, that the substituted service authorized by the Court was invalid. The judgment consequently falls to be considered as a regular judgment. 16. The above nding, however, does not conclude the matter. Even where a judgment is regularly entered, the Court retains a wide discretion under Order 10 Rule 11 of the Civil Procedure Rules, which provides: “Where judgment has been entered under this Order the court may set aside or vary such judgment and any consequential decree or order upon such terms as are just.” https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5892/eng@2026-09-24 3

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17. The discretion must be exercised judicially. In Shah v Mbogo & Another [1967] EA 116, Harris J. stated: “ This discretion is intended to be exercised to avoid injustice or hardship resulting from accident, inadvertence, or excusable mistake or error, but is not designed to assist a person who has deliberately sought, whether by evasion or otherwise, to obstruct or delay the course of justice.” 18. The Court must therefore consider the nature of the proposed defence. In Patel v E.A. Cargo Handling Services Ltd [1974] EA 75, the Court explained that a defence on the merits does not mean one that must ultimately succeed, but one raising a triable issue, namely “an issue which raises a prima facie defence and which should go to trial for adjudication.” 19. The proposed defence in the present matter raises a substantial question concerning ownership of the suit property. The Applicant relies upon a judgment allegedly delivered in Machakos High Court Civil Case No. 245 of 2012, said to have conclusively determined ownership in favour of Kongoacheke Enterprises Limited. If that judgment relates to the same property and the same parties, or parties claiming under them, its eect is plainly material to the present proceedings. It cannot be dismissed summarily merely because the name of the Respondent appears in the earlier proceedings as “Joseph Tomate Mainoya” rather than “Josephat Tumate Mainoya”. Whether the two names refer to one and the same person is ultimately a question of evidence and cannot properly be resolved by a bare assertion. 20. More importantly, if the earlier judgment indeed determined the ownership of the very property now in dispute, the Court ought not permit the present dispute to proceed without considering its legal eect. That issue alone is capable of constituting a triable issue. 21. The Court is not, at this stage, called upon to determine whether the 2012 judgment conclusively binds the parties or whether the alleged discrepancy in names is material. Those are matters properly reserved for determination upon the hearing of the substantive dispute, if necessary. 22. The Respondent's contention that he has occupied the land peacefully for more than twelve years does not, at this stage, dispose of the case. It raises competing questions concerning possession, title and the eect of the previous judgment, the more reason why the application should be allowed to defend this matter. Those questions are better determined on evidence rather than through an application whose immediate purpose is simply to determine whether the Applicant should be aorded an opportunity to defend. 23. I also take into account the constitutional imperative that disputes be determined fairly and on their merits. The Court should not, however, set aside a judgment merely because a party now presents a defence which was available earlier. The discretion under Order 10 Rule 11 is not intended to reward indolence. Nevertheless, where a party demonstrates a bona de and substantial issue requiring adjudication, the overriding consideration remains the attainment of substantive justice. 24. In the circumstances, I am satised that the proposed defence discloses a bona de triable issue concerning the alleged 2012 Machakos judgment and the ownership of the suit property. The prejudice occasioned to the Respondent by reopening the matter can, in my view, be addressed through appropriate terms as to costs, whereas shutting out the Applicant from ventilating a potentially dispositive prior judgment may occasion greater prejudice. 25. Accordingly, the Court nds the Notice of Motion dated 16th April 2026 merited to the extent set out below: https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5892/eng@2026-09-24 4

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a. The ex-parte judgment delivered on 18th December 2025 and the consequential orders/decree arising therefrom are hereby set aside. b. The Applicant, Kongoacheke Enterprises Limited, is granted unconditional leave to defend the suit. c. The Applicant shall le and serve its response to the Originating Summons within 14 days from the date hereof after which time, parties shall take directions on the hearing of the Originating Summons. d. The costs of the application shall be in the cause. It is so ordered. DATED SIGNED AND DELIVERED VIRTUALLY THIS 24TH DAY OF SEPTEMBER, 2026. M.D. MWANGI JUDGE In the virtual presence of: Mr. Kobia for the Defendant/Applicant Mr. Kinisu for the Plainti/Respondent Court Assistant: Alex M.D. MWANGI JUDGE https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5892/eng@2026-09-24 5

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