Lori Systems v Multiple Solutions Limited

ii. That this Honourable Court do issue an order declaring that the proclaimed assets listed in the Proclamation Notices dated 21st March, 2025 belong to the Objector and are not liable for attachment in satisfaction of the decree issued in this instant suit. iii. That the Plaintiff be ordered to pay the Objector punitive damages for illegally and wrongly executing against the Objector in a matter and judgment it is not privy to or a party to. iv. That the Plaintiff do pay costs of this Application. v. That the Court do make such order or further orders as it may deem fair and just in the circumstances. 2. The Application is supported by the Affidavit of the Objector’s Chief Executive Officer, Jimnah Mwangi in which it is deposed that the Objector is a limited liability company operating the business of offering motor vehicle auto body and garage services; that on 21st March .2025 Moran Auctioneers, acting on the instructions of Lori Systems (the Plaintiff) in execution of a decree issued in the present suit on 23rd January 2023 against Multiple Solutions Limited (the Defendant) for a sum of Kshs. 35,622,243/- and USD 253,200, stormed the Objector’s premises and proclaimed various items belonging to the Objector as listed in paragraph 4 of the Supporting Affidavit. 3. The deponent stated, further, that the said proclamation is both ultra vires and illegal for the reason that the listed goods belong solely to the Objector who is neither privy or a party to the instant proceedings. That the decree referenced above was issued against the Defendant and hence there is no basis for compelling the Objector to settle the same. He has stated that unless the orders sought are granted, the Objector is at risk of suffering irreparable loss since the proclaimed goods will be sold by way of a public auction and that the Plaintiff will not be prejudiced if the orders sought are granted. 4. The second Notice of Motion is dated 6th May 2025. It is brought jointly by Rajinder Singh Barayan, Amrik Singh Chhaja Singh, Manvir Singh Barayan, Tarlochan Singh Chajja Singh and MG Holdings Limited (the 1st, 2nd, 3rd, 4th and 5th Respondents). It is seeking the following orders: 5. i. Spent. ii. Spent. iii. That this Honourable Court be pleased to set aside the Orders lifting the corporate veil against the director and/or shareholders of the defendant, Multiple Solutions Limited. iv. That this Honourable Court grant the applicants (the Respondents herein) leave to crossexamine the process server, Dennis Musembi Kiema, the deponent of the Affidavit of service dated 23rd January, 2024 during hearing of this application. v. That the deponent of the affidavit of service dated 23rd January, 2024 be cited for perjury. vi. That this Honourable Court be pleased to grant the applicants (the Respondents) leave to file their responses to the notice of motion dated 30th June, 2023. vii. That the costs of this Application be in the cause. The application is supported by grounds found on the face of it and in the Supporting Affidavit of the 1st Respondent in which it was deposed that the Plaintiff previously filed an application dated 30th June 2023 seeking an order for lifting of the corporate veil of the Defendant, upon which an ex parte lifting order was granted on 19th December 2024; that prior to the filing of the aforementioned application, the Plaintiff never effected service thereof, and/or witness summons upon the Respondents personally, https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16417/eng@2025-10-22 2

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yet the law requires personal service of summons and an application of such nature, upon the relevant directors of a company and that the Respondents only came to learn of the existence of the lifting order upon service of the warrants of attachment. 6. The 1st Respondent has further deposed that the Respondents herein never instructed any advocate or agent to receive any pleadings or documents on their behalf; that the affidavit of service sworn by Dennis Musembi Kiema purporting service of the witness summons upon the Respondents is suspect, since the same contains false averments, including the allegation that service was effected at Taj Mall on 23rd January 2024 whereas the said Mall had been demolished back in the year 2018; that the process server purported to effect service of the witness summons on the firm of Edward C. Asitiba & Associates Advocates, in the absence of any evident instructions to act for the Respondents in the matter and that the purported service upon the 3rd Respondent is a mere fabrication, since the said Respondent died on 14th February 2021. 7. The 1st Respondent has thus averred that the warrants of attachment were issued irregularly, given that the lifting order issued on the Defendant’s corporate veil was obtained through non-disclosure on the part of the Plaintiff and also given the fact that the Respondents were not given an opportunity to be heard on the application dated 30th June 2023. 8. It is the 1st Respondent’s assertion that unless the orders sought in the second application are granted, the Respondents collectively stand to suffer grave loss through the irregular execution process given the colossal nature of the decretal sum. Replying Afidavit 9. The first application is opposed through the Replying Affidavit of Imran Akram, the General Manager of the Plaintiff sworn on 5th April 2025. He has deposed that the said application is fatally defective for the reason that the Objector failed to file an Objector application; that the documentation annexed to the first application indicate that the proclaimed goods were procured in September 2013 and that further documentation indicates that the Objector was incorporated in the year 2015 and therefore, the proclaimed goods were procured in 2013 prior to the incorporation of the Objector. 10. It is the deponent’s further assertion that a company search undertaken on the Objector revealed that the directors/shareholders therein are one and the same as the directors/shareholders of the Defendant; that previously, the court granted an order lifting the corporate veil of the Defendant, hence execution ought to proceed against its directors/shareholders; that the Plaintiff has faced challenges in its attempt at executing the decree, since both the assets of the Defendant and its directors have been concealed and are therefore unknown; that the first application is aimed at impeding the execution process and therefore, the first application ought to be dismissed with costs. Grounds of opposition 11. The second application is also opposed by the Plaintiff through the Grounds of Opposition dated 13th May 2025 set out as follows: i. That the application is an abuse of the court process only meant to derail the ongoing execution proceedings and bar the Plaintiff from enjoying the fruits of its judgment and which judgment amount has been outstanding since 2021. ii. That the orders lifting the Defendant’s corporate veil were issued after one of the directors/ shareholders (and the deponent of the affidavit in support of the Application) appeared in https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16417/eng@2025-10-22 3

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court on behalf of the other directors/shareholders pursuant to summons issued requiring the applicants’ attendance. iii. That the said Rajinder Baryan did swear an Affidavit sworn on 25th of June 2024 in respect to the Application for lifting of corporate veil and filed by the firm of Edward Asitiba & Co. Advocates. iv. That as the court record shall reflect, the firm of Edward Asitiba & Co. Advocates has continuously appeared in the matter on behalf of the Applicants herein. v. That the orders lifting the Defendant’s corporate veil were NOT issued ex parte since both the Defendant and the Directors/shareholders have participated in the proceedings through the firm of Edward Asitiba & Co. Advocates. vi. That the application is purely bad in law, misconceived and totally lacks in merit.” sic 12. The Plaintiff has similarly relied on the replying affidavit sworn by its advocate, Musyoka David, on 12th June 2025 stating that upon filing of the application dated 30th June 2023 seeking to lift the Defendant’s corporate veil, Ongeri, J. directed that the same be listed for directions on 5th October 2023 and that the said application was subsequently served upon all the parties; that on the above date when the parties attended court, Mr. Edward Asitiba, counsel for the Respondents, acknowledged service of the application and sought time to file a response thereto, which request was granted and the matter therefore fixed for a mention for further directions on 27th November 2023 and that on the scheduled date, none of the Respondents attended court, thereby resulting in issuance of directions by the court for summons to be served upon the directors of the Defendant, requiring them to attend the court on 24th January 2024, which summons were duly taken out and served. 13. It is further deposed that on 24th January 2024 Mr. Edward Asitiba appearing on behalf of the Defendant, requested for additional time to enable him avail the directors, upon which the court directed that the directors do appear before it on 26th February 2024 and that upon failure by the directors to appear on the scheduled date, warrants of arrest were subsequently issued; that thereafter, the 1st Respondent attended court on 23rd April 2024 and requested for a period of 60 days to enable the directors of the Defendant create a payment plan for settling the decretal sum as a compromise on the application dated 30th June 2023; that the 1st Respondent swore an affidavit in response to the said application and therefore, service of the application dated 30th June 2023 and the witness summons for the directors were properly effected. 14. In support of the second application, the 1st Respondent has filed a supplementary affidavit sworn on 24th June 2025 supporting that application. he has reiterating his earlier averments, that service of the witness summons was never effected upon the Respondents and that Mr. Edward Asitiba never received instructions to act on behalf of the Respondents. 15. The 1st Respondent has further stated that his attendance in court was purely representative of the Defendant, rather than in a personal capacity. He has equally denied that he swore an affidavit on behalf of the Defendant and/or its directors. Oral submissions 16. The two (2) applications were canvassed simultaneously, by way of oral submissions. Submitting in support of the first application, Mr. Onyango, counsel for the Objector, reiterated the averments made in the supporting affidavit that the said application ought to be allowed for the primary reason that the execution process was erroneously commenced against the Objector who is neither a party to the suit https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16417/eng@2025-10-22 4

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nor a judgment debtor therein and that the proclaimed goods constitute the property of the Objector and are therefore not available for attachment. 17. It was submitted, further, that Order 22, Rule 51 of the Civil Procedure Rules (CPR) permits an Objector to raise an objection similar to that raised in this instance. He relied on the case of Precast Portal Structures v Kenya Pencil Company Ltd & 2 others [1993] KEHC 100 (KLR) in which an objector tendered evidence to support an allegation of ownership of the attached property therein and submitted that in the present instance, the Objector has tendered sufficient documentation to indicate its ownership status of the proclaimed goods, adding that if the Plaintiff is allowed to proceed with execution, then the Objector stands to suffer irreparable loss and that the Objector is therefore deserving of the orders sought in the first application. 18. Mr. Asitiba counsel for the Defendant briefly submitted in supported of the first application and associates himself with the submissions of Mr. Onyango, adding that due diligence ought to be exercised prior to undertaking the attachment on property. 19. In opposing the first application, Mr. Okubasu, advocate for the Plaintiff, reiterated the contents of the replying affidavit, to the effect that since entry of judgment in the present suit close to four (4) years ago, the decree is yet to be settled; that the directors of the Defendant have intentionally concealed its assets in a bid to hamper the execution process; that prior to filing the first application, the Objector ought to have filed a notice of objection accompanied by an affidavit pursuant to Order 22, Rule 51 CPR but did not, thus making the aforesaid application fatally defective; that no proper material has been tendered to support the averment that the proclaimed goods truly belong to the Objector; that the directors of the Defendant and the Objector are one and the same and therefore, the first application ought to be dismissed with costs. 20. In his rejoinder, Mr. Onyango has contended that the Plaintiff has no basis for attaching goods and assets belonging to a third party. He urged the court to deem the failure to file a notice of objection, a procedural technicality rather than a fatality. He further submitted that a company constitutes a distinct and separate entity from its directors and hence the Plaintiff cannot purport to attach goods belonging to the Objector, adding that the directors of the Objector are not limited to the 1st Respondent herein. 21. In respect of the second application, Mr. Walubengo counsel for the Respondents, has maintained that the same ought to be allowed as prayed, for the reason that there is nothing to indicate personal service of the relevant summons upon the Respondents to enable them respond and be heard. Counsel has restated the averments earlier made in the aforementioned application, that the affidavit of service on record and purporting prior service, contains falsehoods on the details of service and that the failure to serve the requisite summons would automatically cause the lifting order to abate. 22. On his part, Mr. Asitiba counsel for the Defendant did not oppose the second application. 23. Mr. Okubasu counsel for the Plaintiff, opposed the second application. He relied on the averments contained in the Replying Affidavit and Grounds of Opposition, maintaining that service of the summons was properly effected and that the Respondents failed to attend court thereby resulting in issuance of warrants of arrest against them. That the 1st Respondent subsequently attended court on behalf of the remaining Respondents and further swore an affidavit indicating a willingness to settle the decretal sum by way of instalments. He submitted that the non-compliance on the part of the Respondents coupled with the lifting order prompted the attachment process. For those reasons, counsel urged that the second application be dismissed with costs. https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16417/eng@2025-10-22 5

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24. In a rejoinder, Mr. Walubengo submitted that the 1st Respondent attended court on the material date merely as a representative of the Defendant and not necessarily in his personal capacity as a director thereof. Analysis and determination 25. I have considered the two (2) applications and the supporting grounds and Replying Affidavits and the Grounds of Opposition in respect thereof. I have read the court record which presents the background of this matter. I have noted that the Plaintiff filed the present suit against the Defendant through a Plaint dated 10th May 2021 seeking a sum of USD 253,200 and a further sum of Kshs. 35,622,243.80 resulting from outstanding and unpaid invoices on the part of the Defendant. The Plaintiff also sought costs of the suit and interest on the owed monies. 26. My duty in resolving the two applications is to determine whether the applications before the court are merited and whether the applicants in each application have demonstrated to the satisfaction of the court that the prayers sought ought to be granted. 27. The record shows that upon the Defendant’s failure to file a statement of defence within the statutory timelines, a default judgment was entered against it on 23.12.2022, as prayed in the plaint. Subsequently, the Plaintiff through its advocate on record, filed an application dated 30th June 2023 seeking, inter alia, an order for issuance of a notice to show cause and summons compelling the directors/shareholders of the Defendant to attend court for purposes of examination on the means and assets of the Defendant; and a subsequent order lifting the corporate veil of the Defendant in order for its directors to be held personally liable to settle the decretal amount. 28. Upon the court’s perusal of the material on record, that application first came up in court on 27th November 2023 and upon consideration it, this court, Ongeri, J., partially granted it and ordered that service of summons be effected upon the Directors of the Defendant, to appear in court on 24th January 2024. On that date, Mr. Asitiba who indicated that he was appearing on behalf of the Defendant and its Directors, sought another date to enable the Directors appear for purposes of cross-examination. In the said proceedings, counsel for the Plaintiff stated that he had experienced challenges in extracting the summons but that he had contacted the Defendant’s counsel. The court consequently directed that the Directors do appear in person on 26th February 2024 for purposes of cross-examination. 29. On 26th February 2024, there was no attendance in court by the Directors, resulting in the issuance of warrants of arrest against them. When the matter subsequently came up in court on 23rd April 2024, Mr. Asitiba indicated that his clients were ready and willing to settle the decretal sum. 30. The record shows that, later in the course of the proceedings, the 1st Respondent appeared in court indicating that he was a Director of the Defendant, and requested for a period of 60 days to enable them to come up with a settlement proposal leading to the lifting of the warrants of arrest previously issued against the Directors, and scheduling of the matter for a mention for the purpose of recording a settlement. The record shows that the matter came up for mentions on various occasions thereafter but that the ongoing negotiations were unsuccessful. 31. Subsequently, the matter came up for mention on 30th October 2024, when this Court, Kassan J, granted the parties leave to file responses (if any) as well as written submissions, in respect of the application dated 30th June 2023. However, when the matter came up in court on 16th December 2024 and 19th December 2024, Mr. Asitiba informed the court that he was having trouble reaching his clients. Upon the request of Mr. Okubasu, counsel for the Plaintiff, the court allowed the application dated 30th June 2023 in terms of orders (iv) and (v) for issuance of warrants of attachment and sale of https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16417/eng@2025-10-22 6

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the assets belonging to the Respondents in their capacities as Directors of the Defendant, and issuance of notices to show cause requiring the said Respondents to show cause as to why they should not be committed to civil jail for their failure to satisfy the decretal sum in the present suit. This led to the filing of the two (2) applications currently before this court. 32. I will consider the second application first. In my considered view, order (iv) of that application has since lapsed, the same having been sought at the interlocutory stage of the application. Orders (iii) and (vi) of the second application seek to set aside the order lifting the corporate veil of the Defendant, and leave of the court to enable the Respondents file their responses to the application dated 30th June 2023, respectively, whereas order (v) seeks to have process server Dennis Musembi Kiema, cited for perjury on the allegation of false averments made in his Affidavit of Service dated 23rd January 2024. 33. I have considered the rival averments and arguments in respect of the second application. The Respondents’ averment in sum is that they were never served with the requisite witness summons and that the Affidavit of Service sworn by the process server contains untrue averments on the manner and venue of service. That, the Respondents have never instructed Mr. Edward Asitiba to act for them in this matter. That in addition, they were not given an opportunity to respond to the application dated 30th June 2023. That in the premises, the resulting warrants of attachment were irregularly issued, thereby necessitating the orders now sought in the second application. 34. In contrast, the Plaintiff has maintained that service was properly effected and that Mr. Asitiba has all along appeared in the matter, on behalf of the Defendant and its Directors. That, the 1st Respondent attended court on behalf of the other Respondents and equally swore an affidavit in response to the application dated 30th June 2023. 35. On the issue of legal representation and/or the validity of legal instructions to Mr. Asitiba, it is apparent from the record that the Respondents have at all material times been the Directors of the Defendant. It is equally apparent from the record that Mr. Asitiba has appeared and acted for the Defendant in the present suit, at all material times; with the said advocate indicated as having been appearing in the matter both for the Defendant and the Respondents as Directors, upon the Plaintiff’s filing of the application dated 30th June 2023. 36. The record also shows that at one point, the 1st Respondent attended court alongside Mr. Asitiba on 23rd April 2024 and the issue of legal representation by the counsel was never previously raised or objected to, before the court. In the circumstances, the court finds that no credible material has been tendered to demonstrate that the said counsel acted in the absence of any requisite instructions by either of the Respondents, at all material times. 37. As relates to the issue of service of the witness summons and whether the process server, Dennis Musembi Kiema, ought to be cited for perjury on the basis of the averments made in his Affidavit of Service, upon a perusal of the said Affidavit of Service sworn on 23rd January 2024 (Annexure “RSB-1”), I have observed that upon receipt of the witness summons dated 22nd January 2024, Mr. Dennis Musembi Kiema proceeded to the Defendant’s offices situated at Multiple Complex near Old Mombasa Road, adjacent to Syokimau Railway Station and that the secretary who was present declined to receive the summons and instead directed him to their offices situated at Taj Mall. That upon his arrival at the said location, he was further directed to the Defendant’s advocates on record in the suit. That he thus proceeded to the offices belonging to the firm of Edward C. Asitiba & Co. Advocates situated at New Waumini House, 1st Floor, Westlands area, where the Office Secretary received the summons and stamped the relevant copies. https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16417/eng@2025-10-22 7

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38. I have observed, further, that the Respondents have equally annexed to the second application, copies of the witness summons issued in their respective names and said to have been served upon the firm of Edward C. Asitiba & Co. Advocates. The respective witness summons bears the official stamp of the said firm of advocates, thereby supporting the averments made in the Affidavit of Service referred to hereinabove. 39. From the foregoing, it is thus apparent that service of the witness summons was effected on the abovementioned firm of advocates and not on the Respondents personally, which gives rise to the question whether service was properly and adequately effected. 40. The procedure pertaining to service of witness summons is found under Order 16 of the CPR. Order 16, Rule 4 thereof provides that: “ Every summons under this Order shall be served as nearly as may be in the same manner as a summons to a defendant, and the rules in Order 5 as to proof of service shall apply in the case of all summonses served under this rule.” 41. Order 5 of the CPR generally provides for issuance and service of summons upon a defendant. Of particular relevance here is Order 5, Rule 8 thereof, which expresses thus: “ (1) Wherever it is practicable, service shall be made on the defendant in person, unless he has an agent empowered to accept service, in which case service on the agent shall be sufficient. (2) A summons may be served upon an advocate who has instructions to accept service and to enter an appearance to the summons and judgment in default of appearance may be entered after such service.” 42. From my reading and understanding of the just-referenced provision, it is clear that service of summons may be effected either personally or through a valid agent or through an advocate with the requisite instructions. In the present instance, as earlier mentioned, the summons upon being extracted, were served upon the firm representing the Defendant at all material times, of whom the Respondents herein are Directors and/or shareholders; thereby causing such service to be sufficient in view of Order 5, Rule 8 CPR and in the absence of any contrary evidence. 43. Further to the foregoing and as earlier established, the 1st Respondent attended court during the pendency of the application dated 30th June 2023 in his capacity as a Director of the Defendant, and urged that the Defendant and/or its agents be granted additional time to come up with a payment proposal for settlement of the decretal amount in the suit. It is thus apparent that the 1st Respondent was therefore aware of the existence of the application dated 30th June 2023. In the court’s view, it is more plausible than not that the Respondents herein (save for the 4th Respondent, who it would appear is now deceased, pursuant to the Certificate of Death tendered as Annexture “RSB-2” indicating that he died on 14.02.2021) were personally made aware as to the existence of the application dated 30th June 2023 and the witness summons as well as, through the firm of Edward C. Asitiba & Co. Advocates. 44. In view of all the circumstances, the court is satisfied that service of the extracted summons was properly effected. 45. Separately, upon taking into account the Respondents’ averment that the deponent of the Affidavit of Service referenced hereinabove ought to be cited for perjury, I have not come across any credible evidence to indicate that the contents of the Affidavit meet the threshold for perjury. The question https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16417/eng@2025-10-22 8

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whether the said deponent visited the venue known as Taj Mall is immaterial here, since it has been established as set out in his Affidavit, that service of the witness summons was effected upon the firm of advocates mentioned hereinabove. 46. It is my considered view, upon reading the court record, that the Respondents were granted every reasonable opportunity to participate in and respond to the application dated 30th June 2023 but did not. It similarly cannot be overlooked that the default judgment entered in the present suit on 23rd December 2022, remains unsettled. 47. In the circumstances therefore, I am not satisfied that any credible material or evidence has been tendered to warrant the exercise of this court’s discretion in favour of the Respondents herein. Consequently, the second application stands dismissed with costs to the Plaintiff. 48. In regard to the first application, therein the Objector is seeking an order declaring that the proclaimed assets listed in the Proclamation Notices dated 21st March 2025 belong to the Objector are not liable for attachment in satisfaction of the decree issued in the present suit and hence, the proclamation and attachment of the proclaimed assets is a nullity. The Objector is further seeking punitive damages and costs of the first application, to be borne by the Plaintiff or the Respondents herein. 49. I have considered the averments by the Objector to the effect that the proclaimed assets do not belong to the Defendant and are therefore not available for proclamation and attachment in any event. I have similarly considered the rival averments by the Plaintiff, that the said application is fatally defective for the reason that the Objector did not file a notice of objection; that the said assets do not belong to the Objector and that in any event, the Directors of the Defendant are one and the same as those of the Objector, thereby causing the proclaimed assets to be available for proclamation and attachment, following the court order lifting the corporate veil of the Defendant. 50. Concerning the question whether the first application is fatally defective for want of filing a notice of objection, the applicable provision is Order 22, Rule 51 of the CPR which sets out the following: “ “ (1) …” Any person claiming to be entitled to or to have a legal or equitable interest in the whole of or part of any property attached in execution of a decree may at any time prior to payment out of the proceeds of sale of such property give notice in writing to the court and to all the parties and to the decree-holder of his objection to the attachment of such property. 51. Sub-rules 2 and 3 of the afore-cited Order 22, Rule 51 prescribe that a notice is to be accompanied by an application supported by an affidavit, and that the notice together with the application ought to be served upon the relevant parties within seven (7) days of filing. 52. From a reading of the above provision, I have noted that they are not couched in mandatory terms. In the circumstances, it is my considered view that that the Objector’s omission to file a notice of objection would not necessarily render the first application fatally defective. 53. On the merits thereof, from the record, it is not disputed that the material assets were proclaimed and attached by the Auctioneers pursuant to the Proclamation of Attachment issued on 21st March 2025 and Warrants of Attachment of Movable Property previously issued on 17th February 2025, copies of which are annexed to the affidavit supporting the first application marked as Annexures “JM 2” and “JM 4” respectively. https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16417/eng@2025-10-22 9

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54. Going by the record, the Objector has equally tendered credible material to support the averment that the proclaimed goods belong to it, as seen in the various delivery notes and invoices marked as Annextures “JM 5A and 5B”. 55. From a further consideration of the record, it is not disputed that the Objector is a limited liability company and hence a legal entity separate and distinct from its directors and/or shareholders. This principle was restated by the Court of Appeal in the case of Gitobu Imanyara & 2 others v Attorney General [2016] KECA 557 (KLR) when it held, inter alia, that: “ ...it is settled law that a company is a separate legal entity from its owners and has a right to sue and be sued as a separate and distinct personality. It is a principle enunciated in the ageold case of Salomon...” 56. As earlier mentioned, default judgment was entered against the Defendant herein, in the present suit. It is apparent from the record that the Objector was never a party to the suit, though the 1st and 3rd Respondents being Directors of the Defendant, are similarly Directors and shareholders of the Objector, while the estate of the 4th Respondent are equally shareholders thereof (as seen in Annexure “LS-1” to the replying affidavit opposing the first application). 57. Nevertheless, the law is well settled that a corporate entity remains separate and distinct from its directors and shareholders. That being the legal position, it cannot be said that the properties of the Objector would be available for attachment based on the fact that the corporate veil of the Defendant has been lifted thereby making its Directors, some of whom also share the Directorship of the Objector, liable to settle the decretal amount in the present suit. The principle of separate and distinct characteristics between a company and its directors or shareholders, extends to the ownership of property. 58. In the present instance, the Plaintiff has not tendered credible material to indicate or infer that the proclaimed assets were being held for and on behalf of either the Defendant or the Respondents herein, at any material time, in order for them to constitute properties available for proclamation and attachment in satisfaction of the decree issued against the Defendant. 59. In view of all the foregoing circumstances, I am satisfied that there was no legal or proper basis upon which the Auctioneers, acting on the instruction of the Plaintiff, could attach the listed proclaimed assets in execution of the decree herein. The court thus finds the proclamation of the respective assets to be illegal and improper, and is satisfied that the foregoing circumstances would warrant an exercise of its discretion in favour of the Objector. 60. The Objector has sought punitive damages arising out of the illegal proclamation. However, I am not convinced that credible material has been tendered to support a grant of the same, in the circumstances. As a result, order (iv) of the first application is denied. 61. Consequently, the following orders are made: i. The Notice of Motion dated 26th March 2025 partially succeeds. ii. An order be and is hereby issued, declaring that the proclaimed assets listed in the Proclamation Notices dated 21st March 2025 belong to the Objector and are not liable for attachment in satisfaction of the decree issued in this instant suit. iii. Costs of the Notice of Motion dated 26th March 2025 shall be paid by the Plaintiff to the Objector. https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16417/eng@2025-10-22 10

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iv. 62. The Notice of Motion dated 6th May 2025 is hereby dismissed, with costs to the Plaintiff. Orders shall issue accordingly. DATED, SIGNED AND DELIVERED THIS 22 ND OCTOBER 2025. S. N. MUTUKU JUDGE https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16417/eng@2025-10-22 11

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