Vintage Liquor & Wine Limited v Winadmelant (wama) Limited

5. The starting point is Section 12(1) of the Small Claims Court Act, which grants the court jurisdiction to determine civil claims whose subject matter does not exceed Kshs. 1,000,000/=. Section 38 of the same Act provides that a decree of the Small Claims Court shall be executed in the same manner as a decree of a subordinate court of the first class under the Civil Procedure Act and Rules. 6. While the Small Claims Court may issue warrants of attachment and sale, its jurisdiction is confined to the execution process against the Judgment Debtor and does not extend to post-judgment proceedings that touch on discovery or personal liability of directors of a corporate Judgment Debtor. The powers under Order 22, rule 35 of the Civil Procedure Rules to summon company officers and examine them on oath regarding the company’s assets and means, are exercised by the court that issued the decree, or by a court of concurrent or higher jurisdiction for purposes of enforcement. 7. However, the Small Claims Court, being a statutory creation with limited jurisdiction, does not possess inherent powers under Section 3A of the Civil Procedure Act, nor does it have jurisdiction to lift the corporate veil, which is a remedy reserved for the High Court under its unlimited original jurisdiction conferred by Article 165(3)(a) of the Constitution. 8. In Masefield Trading (K) Ltd v Rushmore Company Ltd & Another [2008] eKLR, Kimaru J held that Order 22, rule 35 empowers the court to summon officers of a company for examination and, if appropriate, to lift the corporate veil for purpose of discovery in aid of execution. 9. Similarly, in Ultimate Laboratories v Tasha Bioservice Ltd [2000] eKLR, Ringera J (as he then was) affirmed that the High Court has jurisdiction to pierce the corporate veil in execution proceedings grounded under Order 22, rule 35. 10. Consequently, while the Small Claims Court may issue execution orders within its pecuniary limits, it may not summon directors for examination or lift the veil. Such jurisdiction properly vests in this Court, and in any event, prevents bifurcation of the execution process. Analysis and Determination 11. Applying the above principles, I am persuaded that the present application is properly before this Court. The record shows that the decree of the Small Claims Court remains unsatisfied. The Applicant has shown that the Respondent is a limited liability company whose assets, if any, are unknown, and that its directors may have relevant information that could aid discovery for the purpose of execution. 12. Order 22, rule 35 expressly empowers this Court to summon company officers for examination where a decree remains unsatisfied. In the circumstances, the examination sought serves a limited purpose, to obtain discovery of the company’s means, and does not, at this stage, amount to imposing personal liability. 13. The Court in Robert Kinaga Waweru v Northcorr Enterprises Ltd [2011] eKLR observed that directors of a Judgment Debtor company must give a full account of the company’s assets, and it would be inequitable for the Court to close its eyes to possible concealment of such assets. 14. Accordingly, I find that the Applicant has satisfied the threshold for the Court to invoke its powers under Order 22, rule 35. The process, is a two-stage one: first, the production of books and documents; and second, the cross-examination of directors thereafter to determine whether further orders, including lifting of the corporate veil, are warranted. https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/15811/eng@2025-11-04 2

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Disposition 15. Based on the foregoing reasons, I am satisfied that the application has merit. The Notice of Motion dated 31st October, 2024, is allowed in the following terms:a. The Judgment Debtor shall, within twenty-one (21) days from the date hereof, produce and furnish to the Applicant copies of its books of account, audited financial statements, bank statements, and other records relevant to the execution of the decree. b. Upon compliance, the Applicant shall be at liberty to apply for the cross-examination of the directors of the Judgment Debtor at a date to be fixed by the Court. c. Costs of this application shall be borne by the Judgment Debtor. DATED AND DELIVERED VIRTUALLY VIA MICROSOFT TEAMS THIS 4TH DAY OF NOVEMBER, 2025 ALEEM VISRAM, FCIArb JUDGE In the presence of; Court Assistant: Lispa ..................for Decree Holder/Applicant ................for Judgment Debtor/Respondent https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/15811/eng@2025-11-04 3

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