Credit Bank Plc v Michael Nyachae & 2 others

4. In opposition to the application herein, the plaintiff filed Grounds of Opposition dated 23rd May 2025, raising the following grounds – i. That the cause of action in the plaintiff's suit arises solely from the Guarantee and Indemnity dated 12th October 2016 (“Directors’ Guarantee”), which was made only between the plaintiff and the 1st, 2nd & 3rd defendants herein. Associated Auto Centre Limited (“the proposed 4th defendant”) was not a party to the Directors’ Guarantee and is therefore not a necessary or proper party to the suit; ii. That there is no relief sought by the plaintiff, or indeed proposed by the 1st defendant, against the proposed 4th defendant and therefore, the proposed 4th defendant cannot be joined as a defendant. Joining it in the suit will be in vain; iii. That the reliefs sought by the plaintiff in the suit can be enforced against the defendants herein without the presence of the proposed 4th defendant; iv. That the Court can hear and determine all the questions in the suit without the presence of the proposed 4th defendant; v. That the grounds by the 1st defendant for his application relate to different causes of action which are not the subject matter of the plaintiff’s suit. The 1st defendant cannot force the plaintiff to pursue other causes of action in other separate and distinct Agreements; vi. That all that the 1st defendant has managed to demonstrate in the application herein is that he is liable as Guarantor under the Directors’ Guarantee, but seeking to hide behind the primary debtor, of which he is a Director. The sole purpose of the Directors’ Guarantee was to provide further and additional security to the plaintiff beyond and besides what was offered by the primary debtor; vii. That any cause of action that the plaintiff might have against the proposed 4th defendant (as primary debtor) is completely different from that which it has against the three defendants herein, and it would be a complete misjoinder of causes of action to join the proposed 4th defendant in this suit; viii. That the 1st defendant herein has the right in law to issue appropriate notices for contribution or indemnity from the proposed 4th defendant should he consider such action to be in his own interest, without involving the plaintiff in such adventure; ix. That the 1st defendant, in common with the other defendants (and being a Director of the proposed 4th defendant together with the other 2 defendants) is at liberty to include and summon the proposed 4th defendant as its (or their) witness should he or they consider that the proposed 4th defendant has anything useful to contribute to the suit including details of how any securities were dealt with and accounted for; x. That the 1st defendant has not demonstrated any prejudice it would suffer if the proposed 4th defendant was not joined; xi. That as regards the proposed amendments to the 1st defendant’s statement of defence: a. No reason has been given as to why or how the amendments have become necessary and why the statement of defence was not appropriately crafted in the first instance. https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/6144/eng@2026-04-17 2

page 2 of 11

5. b. The proposed amendments include legal fallacies and imponderables such as the alleged “actual discharge” of the Directors’ Guarantee as postulated in the proposed Paragraph 4a. c. The same merely seeks to include evidence to be relied upon, which is not the role of pleadings. It is unnecessary to amend a statement of defence to indicate the document(s) a party will rely on by way of evidence or the documents it will insist on. xii. That for the reasons stated above, the application by the 1st defendant is frivolous, vexatious and an abuse of the Court process, aimed solely at delaying the hearing and determination of the suit; xiii. That the plaintiff will suffer great prejudice if the 1st defendant’s application is allowed, including the delay of the hearing and determination of the suit; and xiv. Any other grounds that may be adduced at the hearing of the application. In addition to the application, the 1st defendant also filed a Notice of Preliminary Objection dated 18th August 2025, raising the following grounds – i. The suit as filed is incompetent, bad in law and fatally defective for failure to join Associated Auto Centre Limited, the principal debtor and primary obligor in respect of the alleged loan facility forming the subject matter of the suit; ii. The plaintiff's cause of action, if any, arises primarily against Associated Auto Centre Limited, and liability of the 1st defendant (if any) is merely collateral, dependent on proof of indebtedness by the said company, which proof cannot be properly established in its absence; iii. The non-joinder of Associated Auto Centre Limited offends the provisions of Order 1 Rule 10(2) of the Civil Procedure Rules, 2010, which requires all necessary parties to be joined for effective and complete adjudication of the issues in dispute; iv. The suit as constituted is misconceived, premature and an abuse of the process of this Honorable Court and should be struck out with costs to the 1st defendant. Statutory Provisions in support of the preliminary objection. 6. Order 1 Rule 10(2), Civil Procedure Rules, 2010 - Court's power to strike out or add necessary parties to enable complete adjudication. 7. Sections 1A & 1B, Civil Procedure Act (Cap 21) - Overriding objective to facilitate just, expeditious and proportionate resolution of disputes. 8. Section 3A, Civil Procedure Act (Cap 21) - Inherent power of the Court to make orders necessary for the ends of justice and to prevent abuse of the process. Case Law in support of the preliminary objection. 9. Departed Asians Property Custodian Board v Jaffer Brothers Ltd [1999] 1 EA 55 (SCU) - A necessary party is one without whom no effective decree can be passed. 10. Amon v Raphael Tuck & Sons Ltd [1956] 1 All ER 273 - Test of a necessary party: whether the order sought would directly affect the party's legal rights. https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/6144/eng@2026-04-17 3

page 3 of 11

11. Kenya Commercial Bank Ltd v Osebe [1982] KLR - Liability of guarantors is secondary unless the guarantee provides otherwise. 12. Ze Yu Trading Co Ltd v Yang t/a Yang t/a Fo Shan Furniture [2008] eKLR - Court struck out suit for failure to join necessary parties. 13. Departed Asians Custodian Board v Issa Balinda & others (supra) - A court cannot proceed in the absence of necessary parties. 14. Salomon v Salomon & Co Ltd [1897] AC 22 - Company is a separate legal person; liability of directors is distinct from that of the company. 15. The application herein and the 1st defendant’s Notice of Preliminary Objection were canvassed concurrently by way of written submissions. The 1st defendant’s submissions were filed on 19th August 2025 and 27th October 2025 by the law firm of DRCO Kenyariri Advocates LLP, while the plaintiff’s submissions were filed by the law firm of Mboya Wangong’u & Waiyaki Advocates on 9th October 2025. 16. Dr. Kenyariri, learned Counsel for the 1st defendant submitted that the plaintiff bears the burden of proving the existence and terms of the Loan Agreement, the alleged default by the company, and the enforceability and extent of any guarantee or indemnity. He stated that in the absence of the principal debtor as a party to the suit, the plaintiff is incapable of discharging its burden, as the Guarantor’s liability, though sometimes framed as independent, cannot in practice be determined without establishing the company’s indebtedness and default. Counsel asserted that the alleged Guarantee was merely collateral and did not create primary liability, and that any obligation on the 1st defendant’s part can only arise upon proper proof of the principal debtor’s liability, which cannot be achieved without the company’s participation in these proceedings. 17. Dr. Kenyariri invoked the provisions of Order 1 Rule 10(2) of the Civil Procedure Rules, 2010, and argued that it is a settled principle that a creditor should primarily proceed against the principal debtor, as liability flows from the Loan Agreement, with Associated Auto Centre Limited, being the primary obligor, is a necessary party to this suit for the Court to effectually and completely adjudicate the dispute herein. He contended that the failure to join the company to this suit is fatal, as the liability of a Guarantor is secondary and contingent upon proof of the principal debtor’s default. Counsel averred that the alleged Guarantee was neither absolute nor “on demand” but limited in scope and has in any event been discharged by the plaintiff’s conduct, particularly the release of securities without his consent. 18. Dr. Kenyariri cited the case of Holmes v Brunskill [1878] 3 QBD 495, and contended that any material variation of the Loan Agreement without the Guarantor’s consent operates to discharge liability. In addition, he emphasized that the 1st defendant acted solely in his capacity as an Officer of the company and not as a personal borrower, and that there are no lawful grounds to lift the company’s corporate veil. He reiterated that the plaintiff must prove execution and enforceability of the guarantee, the outstanding amount, and the fact of default, matters that cannot be properly established without the company’s joinder. It was submitted by Counsel that if the plaintiff considers the company insolvent, the appropriate recourse lies under the Insolvency Act, 2015, as instituting proceedings against the 1st defendant individually is an attempt to circumvent statutory processes. 19. Ms Makena, learned Counsel for the plaintiff submitted that the proposed 4th defendant is not a necessary party to this suit, thus it ought not to be joined to these proceedings. While acknowledging the Court’s discretion under Order 1 Rule 10(2) of the Civil Procedure Rules, 2010, to add parties https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/6144/eng@2026-04-17 4

page 4 of 11

where necessary for the effectual and complete adjudication of all issues, Counsel relied on the case of Lucy Nungari Ngigi & 128 others v National Bank of Kenya Limited & another [2015] KEHC 6117 (KLR), and argued that such power should only be exercised where the presence of the party is essential. She contended that the proposed 4th defendant is not privy to the Guarantee and Indemnity dated 12th October 2016, which forms the sole basis of the suit, and therefore no cause of action arises against it in these proceedings. 20. Ms Makena maintained that the claim before the Court concerns enforcement of the Guarantee against the existing defendants, which is distinct from any claim that may arise under the Loan Agreement against the principal borrower. As such, all issues in dispute, particularly whether the defendants honoured the demand under the Guarantee, can be conclusively determined without joining the proposed 4th defendant. She further asserted that the proposed joinder would occasion unnecessary delay, costs, and prejudice to the plaintiff, especially given that no reliefs have been sought against the proposed party and it would have no substantive defence to the claim. Counsel submitted that the existence of the Loan Agreement and the principal borrower’s default are not in dispute and have been sufficiently demonstrated through documentary evidence, including statements of account, which have not been controverted. 21. She argued that the plaintiff is fully capable of discharging its burden of proof without the joinder of the principal borrower, and that the enforceability and extent of the Guarantee can be determined solely on the basis of the Guarantee document itself. Ms Makena relied on the case of Rose Chepkirui Mibei v Jared Mokua Nyariki & 2 others [2015] KEELC 81 (KLR), and contended that a creditor is not obligated to first pursue the principal debtor before enforcing a guarantee. She cited the case of Fidelity Commercial Bank Limited v Kenya Grange Vehicle Industries Limited [2017] eKLR, and emphasized that a Guarantee is an independent and binding contract, enforceable irrespective of disputes in the underlying transaction, and that liability attaches once default and demand are established. She maintained that any alleged disputes regarding the Loan Agreement, variation of terms, or discharge of securities are matters for determination at trial and do not warrant joinder at this stage. 22. Ms Makena submitted that conditions for amendment, as set out by the Court in the case of Kassam v Bank of Baroda (Kenya) Limited [2002] KEHC 1109 (KLR), have not been satisfied. She further submitted that the 1st defendant has failed to demonstrate the necessity of the amendments for determining the real issues in controversy, and that the proposed amendments are irrelevant, introduce a new and distinct cause of action, and would fundamentally alter the character of the suit. Counsel further contended that it would suffer prejudice through delay and additional costs, particularly as the amendments merely seek to introduce additional evidence, which could instead be addressed through a supplementary bundle of documents without reopening pleadings. 23. In a rejoinder, Dr. Kenyariri submitted that once the Court finds that the proposed 4th defendant is a necessary party, the amendment would naturally follow, as parties have an inherent right to seek amendment of pleadings at any stage. He further submitted that the plaintiff has misconstrued the nature of the proceedings by relying on authorities relating to realization of securities, whereas this suit has not reached that stage. He argued that the plaintiff’s submissions improperly assume that liability has already been established and execution is imminent, yet no evidence has been tested before the Court. He maintained that proof of default by the principal debtor, Associated Auto Centre Limited, is a prerequisite to any claim under the alleged Guarantee, and such proof cannot be properly established in the absence of the company as a party. Counsel questioned how the Court can determine matters such as default, discharge of liability, or alleged variation of the Loan Agreement without the participation of the principal debtor. https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/6144/eng@2026-04-17 5

page 5 of 11

24. Dr. Kenyariri asserted that this suit is fatally defective for non-joinder of a necessary party, namely Associated Auto Centre Limited, contrary to the provisions of Order 1 Rule 10(2) of the Civil Procedure Rules, 2010. He further relied on the provisions of Sections 1A & 1B of the Civil Procedure Act on the overriding objective of facilitating just, expeditious, and proportionate resolution of disputes, as well as Section 3A on the Court’s inherent powers. To buttress these submissions, Counsel relied on the cases of Departed Asians Property Custodian Board v Jaffer Brothers Ltd [1999] 1 EA 55, Kenya Commercial Bank Ltd v Osebe [1982] KLR and Ze Yu Trading Co Ltd v Yang t/a Fo Shan Furniture [2008] eKLR. Dr. Kenyariri urged the Court to uphold the Preliminary Objection, strike out the suit with costs, or in the alternative to order the joinder of the principal debtor to enable a just and complete determination of the dispute. Analysis and Determination. 25. I have considered the instant application, the grounds on its face and the affidavit filed in support thereof. I have also considered the grounds of opposition by the plaintiff, the Notice of Preliminary Objection by the 1st defendant and the written submissions by Counsel for the parties. The issues that arise for determination are i. Whether the 1st defendant’s Notice of Preliminary Objection is merited; ii. Whether Associated Auto Centre Limited should be joined to this suit; and iii. Whether the 1st defendant should be granted leave to amend his statement of defence. Whether the 1st defendant’s Notice of Preliminary Objection is merited. 26. In order for a Preliminary Objection to succeed, it should raise a pure point of law, it should be argued on the assumption that all the facts pleaded by the other side are correct. It cannot be raised if any fact has to be ascertained or if what is sought is the exercise of judicial discretion. What constitutes a valid Preliminary Objection was considered by the Court of Appeal in the case of Mukisa Biscuits Manufacturing Co. Ltd v West End Distributors Ltd [1969] EA 696 as hereunder – So far as I am aware, a preliminary objection consists of a point of law which has been pleaded, or which arises by clear implication out of pleadings, and which if argued as a preliminary point may dispose of the suit. Examples are an objection to the jurisdiction of the court, or a plea of limitation, or a submission that parties are bound by the contract giving rise to the suit to refer the dispute to arbitration. 27. In the said case, Sir Charles Newbold P., stated thus… the first matter related to the increasing practice of raising points, which should be argued in the normal manner, quite improperly by way of preliminary objection. A preliminary objection is in the nature of what used to be a demurrer. It raises a pure point of law which is argued on the assumption that all facts pleaded by the other side are correct. It cannot be raised if any fact has to be ascertained or if what is sought is the exercise of judicial discretion. The improper raising of points by way of preliminary objection does nothing but unnecessarily increase costs and, on occasion confuse issues. This improper practice should stop. 28. On perusal of the 1st defendant’s Notice of Preliminary Objection, it is anchored on the ground that this suit is fatally defective for non-joinder of Associated Auto Centre Limited, the alleged principal debtor. In this case, while it is contended that the proposed 4th defendant, Associated Auto Centre https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/6144/eng@2026-04-17 6

page 6 of 11

Limited, is the primary debtor, the plaintiff claims that the 1st, 2nd & 3rd defendants' alleged liability arises solely out of the Guarantee and Indemnity dated 12th October 2016. 29. This Court is of the finding that the issue of whether or not Associated Auto Centre Limited is a necessary party to this suit is not a pure point of law but one that calls for an examination of the nature of the claim, the contractual relationships between the parties, and the evidence relating to the loan, the Guarantee and the alleged default. This in my considered view, invites the Court to interrogate facts and examine evidence, and falls outside the scope of a Preliminary Objection. Further, the plaintiff’s claim is founded on a Guarantee and Indemnity dated 12th October 2016, which Associated Auto Centre Limited is not a party to. 30. A contract of guarantee constitutes a distinct and enforceable obligation, independent of the underlying contract, unless otherwise expressly provided. As such, the issue of whether the Guarantor can be sued without joining the principal debtor is not one that automatically renders the suit incompetent. 31. In addition to the foregoing, this Court is also alive to the provisions of Order 1 Rule 9 of the Civil Procedure Rules, 2010, which states that – No suit shall be defeated by reason of the misjoinder or non-joinder of parties, and the court may in every suit deal with the matter in controversy so far as regards the rights and interests of the parties actually before it. 32. Further, under Order 1 Rule 10(2) of the Civil Procedure Rules, Courts have the discretion at any stage of the proceedings, either suo moto or upon the application of a party, to order the removal of any party who has been improperly joined to the suit as a plaintiff or a defendant. In addition, Courts may direct that any person who ought to have been joined to a suit as a plaintiff, a defendant or whose presence is necessary for the Court to effectively and fully resolve all the issues in the matter, be added as a party on such terms as it deems just. 33. The Court in the case of Zephir Holdings Limited v Mimosa Plantations Limited, Jeremiah Matagaro & Ezekiel Misango Mutisya [2014] KEHC 1981 (KLR), in addressing the question of whether nonjoinder of parties can defeat a suit held that A proper party is one who is impleaded in the suit and qualifies the thresholds of a plaintiff or defendant under Order 1 rule 1 and 2 respectively, or as a third party or as an interested party and whose presence is necessary or relevant for the determination of the real matter in dispute or to enable the court effectually and completely adjudicate upon and settle all questions involved in the suit. And the court has a wide discretion to even order suo moto for a party to be impleaded whose presence may be necessary to enable the court effectually and completely adjudicate upon and settle all questions involved in the suit. Accordingly, a suit cannot be defeated for mis-joinder or non-joinder of parties. 34. In view of the foregoing, this Court is not persuaded that this suit can be defeated and/or rendered fatally defective on account of the plaintiff’s failure to join Associated Auto Centre Limited as a defendant in this suit as the said company can always be joined to this suit in the manner provided for under Order 1 Rule 10(2) of the Civil Procedure Rules, 2010. 35. In the circumstances, this Court finds that the 1st defendant’s Notice of Preliminary Objection dated 18th August 2025 is not merited. https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/6144/eng@2026-04-17 7

page 7 of 11

Whether Associated Auto Centre Limited should be joined to this suit. 36. Whereas the Court has found that non-joinder of the principal debtor does not render the suit fatally defective nor raise a pure point of law capable of disposing of the suit at a preliminary stage, it does not follow that such a party is unnecessary. The question of joinder is distinct and calls for the exercise of judicial discretion. 37. Joinder of parties to a suit is provided for under the provisions of Order 1 Rule 10(2) of the Civil Procedure Rules, 2010, which states that The court may at any stage of the proceedings, either upon or without the application of either party, and on such terms as may appear to the court to be just, order that the name of any party improperly joined, whether as plaintiff or defendant, be struck out, and that the name of any person who ought to have been joined, whether as plaintiff or defendant, or whose presence before the court may be necessary in order to enable the court effectually and completely to adjudicate upon and settle all questions involved in the suit, be added. 38. 39. The tests for determining an application for joinder of parties were restated by the Court in the case of Kingori v Chege & 3 others [2002] 2 KLR 243, where Nambuye J., (as she then was) stated that the guiding principles when an intending party is to be joined to proceedings are i. He must be a necessary party; ii. He must be a proper party; iii. In the case of the defendant there must be a relief flowing from that defendant to the plaintiff; iv. The ultimate order or decree cannot be enforced without his presence in the matter; and v. His presence is necessary to enable the Court effectively and completely adjudicate upon and settle all questions involved in the suit. In Civicon Limited v Kivuwatt Limited & 2 others [2015] KECA 588 (KLR), the Court of Appeal when dealing with an application similar to the instant one, made the following observation Again, the power given under the Rules is discretionary which discretion must be exercised judicially. The objective of these Rules is to bring on record all the persons who are parties to the dispute relating to the subject matter, so that the dispute may be determined in their presence at the time without any protraction, inconvenience and to avoid multiplicity of proceedings. Thus, any party reasonably affected by the pending litigation is a necessary and proper party, and should be enjoined… from the foregoing, it may be concluded that being a discretionary order, the court may allow the joinder of a party as a defendant in a suit based on the general principles set out in Order I rule 10 (2) bearing in mind the unique circumstances of each case with regard to the necessity of the party in the determination of the subject matter of the suit, any direct prejudice likely to be suffered by the party and the practicability of the execution of the order sought in the suit, in the event that the plaintiff should succeed. We may add that all that a party needs to do is to demonstrate sufficient interest in the suit; and the interest need not be the kind that must succeed at the end of the trial. 40. Based on the material placed before this Court to the effect that Associated Auto Centre Limited is the principal borrower under the loan facility that gave rise to the subject Guarantee, the 1st https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/6144/eng@2026-04-17 8

page 8 of 11

defendant’s position is that his liability, if any, is collateral and dependent upon proof of the company’s indebtedness and default. Even though the plaintiff argued that the Guarantee constitutes an independent contract, this Court is of the view that in the circumstances of this case, the determination of the Guarantor’s liability is closely intertwined with the existence, extent, and default of the principal obligation. Therefore, questions relating to the amount outstanding, the status of securities, and any alleged variation or discharge of the facility cannot be fully and effectually determined without the participation of the principal debtor. 41. Additionally, this Court notes that the 1st defendant has raised substantive issues touching on the conduct of the plaintiff in relation to the loan facility, including alleged release of securities and variation of terms, which, if established, may have a bearing on the enforceability of the guarantee. This Court is of the considered view that these matters directly implicate the principal debtor and cannot be fairly adjudicated in its absence. Moreover, the principle of separate corporate personality as enunciated in the often cited case of Salomon v Salomon & Co Ltd [1897] AC 22, reinforces the need to treat the company as a distinct legal entity whose rights and obligations cannot be determined in absentia, where they are directly implicated. 42. In light of the above, this Court finds that Associated Auto Centre Limited is a necessary party to this suit, whose presence is required for the effectual and complete adjudication of all issues in controversy between the parties herein. Further, this Court is persuaded that any prejudice that the plaintiff is likely to suffer can be compensated by costs, whereas failure to join Associated Auto Centre Limited would occasion a real risk of injustice and multiplicity of proceedings. 43. Accordingly, this Court finds that the 1st defendant has established sufficient basis for me to exercise my discretion in its favour and join Associated Auto Centre Limited to this suit. Whether the 1st defendant should be granted leave to amend his statement of defence. 44. Amendment of pleadings with leave of the Court is provided for under the provisions of Order 8 Rule 3 of the Civil Procedure Rules, 2010, which states that – 1. Subject to Order 1, rules 9 and 10, Order 24, rules 3, 4, 5 and 6 and the following provisions of this rule, the court may at any stage of the proceedings, on such terms as to costs or otherwise as may be just and in such manner as it may direct, allow any party to amend his pleadings. 2. Where an application to the court for leave to make an amendment such as is mentioned in sub - rule (3), (4) or (5) is made after any relevant period of limitation current at the date of filing of the suit has expired, the court may nevertheless grant such leave in the circumstances mentioned in any such sub - rule if it thinks just so to do. 3. An amendment to correct the name of a party may be allowed under sub - rule (2) notwithstanding that it is alleged that the effect of the amendment will be to substitute a new party if the court is satisfied that the mistake sought to be corrected was a genuine mistake and was not misleading or such as to cause any reasonable doubt as to the identity of the person intending to sue or intended to be sued. 4. An amendment to alter the capacity in which a party sues (whether as plaintiff or as defendant by counterclaim) may be allowed under subrule (2) if the capacity in which the party will sue is one in which at the date of filing of the plaint or counterclaim, he could have sued. 5. An amendment may be allowed under sub - rule (2) notwithstanding that its effect will be to add or substitute a new cause of action if the new cause of action arises out of the same facts https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/6144/eng@2026-04-17 9

page 9 of 11

or substantially the same facts as a cause of action in respect of which relief has already been claimed in the suit by the party applying for leave to make the amendment. 45. It is trite that this Court has the discretion to order the amendment of any pleading pursuant to the provisions of Order 8 Rule 5(1) of the Civil Procedure Rules, 2010, which provides that – For the purpose of determining the real question in controversy between the parties, or of correcting any defect or error in any proceedings, the court may either of its own motion or on the application of any party order any document to be amended in such manner as it directs and, on such terms, as to costs or otherwise as are just. 46. The principles governing amendment of pleadings are well settled. Courts are encouraged to freely allow amendments at any stage of the proceedings, provided that the amendments are necessary for determining the real questions in controversy, they do not occasion prejudice to the parties to the suit that cannot be compensated by costs, and that they are not made in bad faith or intended to delay justice. These principles were succinctly stated by the Court in the case of Kassam v Bank of Baroda (Kenya) Limited [2002] 1 KLR 294, as hereunder – a. The party applying is not acting mala fides; b. The amendment will not cause some injury to the other side which cannot be compensated by costs; c. The amendment is not a device to abuse the court process; d. The amendment is necessary for the purpose of determining the real questions in controversy between the parties and avoid multiplicity of suits; e. And that the amendment will not alter the character of the suit. 47. From the 1st defendant’s affidavit in support of the application herein and the draft amended statement of defence, this Court notes that the 1st defendant seeks to amend his defence to incorporate the Letter of Offer dated 19th September 2016 and to introduce matters relating to the role of Associated Auto Centre Limited to the dispute herein. The 1st defendant asserted that the aforesaid Letter of Offer was not within his possession at the time of filing the original defence. 48. This Court is persuaded that the proposed amendments are intended to place before the Court all relevant material necessary for the just determination of the dispute between the parties herein. They do not introduce a wholly new or inconsistent cause of action, but rather they elaborate on the existing defence and bring into focus issues central to the dispute. Having found that Associated Auto Centre Limited is a necessary party, it follows that the 1st defendant ought to be afforded an opportunity to amend his pleadings to align them with the issues arising from such joinder. 49. The plaintiff’s apprehension regarding delay and prejudice is noted. However, I am satisfied that such prejudice can be adequately addressed by granting corresponding leave to the plaintiff to amend its pleadings, if necessary, and by an award of costs. 50. This Court therefore finds that the 1st defendant has met the threshold for being granted leave to amend his statement of defence. 51. The upshot is that the 1st defendant’s Notice of Preliminary Objection is devoid of merits, while his application dated 25th April 2025 is merited. Consequently, I make the following orders - https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/6144/eng@2026-04-17 10

page 10 of 11

i. The 1st defendant’s Notice of Preliminary Objection dated 18th August 2025 is hereby dismissed; ii. This Court hereby joins Associated Auto Centre Limited as the 4th defendant in this suit; iii. The 1st defendant is granted leave to amend his Statement of Defence dated 23rd December 2024 in terms of his draft Statement of Defence, within 14 days from the date of this Ruling. iv. The plaintiff is granted corresponding leave to amend its pleadings, if necessary, within 14 days of service of the amended statement of defence; and v. Costs of the 1st defendant’s Notice of Preliminary Objection and the application herein shall be borne by the 1st defendant and are hereby awarded to the plaintiff. It is so ordered. DATED, SIGNED AND DELIVERED AT KIAMBU ON THIS 17TH DAY OF APRIL 2026. RULING DELIVERED THROUGH MICROSOFT TEAMS ONLINE PLATFORM. NJOKI MWANGI JUDGE In the presence of:No appearance for the 1st defendant/applicant Ms. Fridah Gatwiri h/b for Mr. Peter Waiyaki for the plaintiff. Ms. Kebungo h/b for Mr. Nyamurungi for the 2nd defendant Mr. Gachau holding h/b Mr. Kimani for the 3rd defendant Ms Julia – Court Assistant. NJOKI MWANGI, J. https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/6144/eng@2026-04-17 11

page 11 of 11