Medispec Kenya Limited v Joy Nursing & Maternity Eastleigh Limited & 2 others

Otieno and Otieno Kennedy Tindi, in their capacity as directors of the Respondent Company, in default of payment of the decretal sum. 4. Despite proper service, as evidenced by the Affidavits of Service filed on record, the Judgment Debtors have failed to file any response to the application. Nonetheless, this Court retains the duty to consider the application on its merits and to evaluate the veracity of the averments placed before it. Analysis and Determination 5. The purpose of an application brought under Order 22 Rule 35 is to assist the decree-holder in uncovering the assets and financial means available for satisfying a lawful decree. The provision acknowledges that execution may be hindered not only by the apparent lack of visible assets, but also through concealment, dissipation, or the deliberate withholding of information concerning the judgment debtor’s financial position. 6. This position was aptly captured by Ringera J. (as he then was) in Ultimate Laboratories V Tasha Bioservice Ltd, [HCCC No. 1287 of 2000], where the learned Judge stated: “ The objective of an examination of a company’s director or officer under Order XX1 Rule 36 is to obtain discovery, for the purpose of execution of a decree against the company, as to whether any or what debts are owing to the judgment debtor and whether the judgmentdebtor has any and what property or means of satisfying the decree.” 7. I entirely adopt that reasoning. The Court’s jurisdiction under Order 22 Rule 35 is not contingent upon proof of fraud or the lifting of the corporate veil. Those are separate issues that may arise later, depending on the evidence elicited during such examination. The law recognizes that when a decree is unsatisfied, directors and officers of a company, who are presumed to be the custodians of its afiairs, may be compelled to account to the Court by disclosing information concerning the company’s means. 8. It is only if such examination discloses evidence of fraud, bad faith, or misuse of the corporate form to defeat legal obligations that the question of lifting the corporate veil may properly arise. At this stage, the only threshold is whether there exists an unsatisfied money decree and whether the decree-holder has demonstrated difficulty in tracing assets available for execution. 9. From the evidence before me, it is clear that judgment was entered against the Judgment Debtors in SCCOMM No. E8132 of 2023 on 14th December 2023, with a decree subsequently issued on 6th March 2024. The Applicant’s assertion that all attempts at execution have been thwarted, and that no attachable assets of the Judgment Debtor have been identified or disclosed, remains unchallenged. This circumstance strongly warrants the Court’s intervention to facilitate discovery through the examination of the company’s officers. 10. Accordingly, it is just and necessary that the directors named in the CR12 annexed to the application be summoned to attend court for oral examination. Such examination will enable the Decree Holder, and ultimately the Court, to establish the true financial position of the Judgment Debtor and to determine the means, if any, by which the decretal sum may be satisfied. Disposition 11. Accordingly, I allow the said application in the following terms: i. Leave is hereby granted to the Decree Holder to issue summons to Emmaculate Atieno Otieno And Otieno Kennedy Tindi the last known Officials and or Directors of the 1st Judgment Debtor/Respondent Company and to compel the said Officials and or Directors to be orally https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/6971/eng@2026-05-21 2

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examined on oath as to the particulars and whereabouts of other Directors (if any), the Judgment Debtor's means, assets and liabilities and to produce the books of accounts claim as the Directors of the Respondent company. ii. The question of whether the directors may ultimately be held personally liable, is a distinct issue that will only fall for consideration upon completion of the examination and upon proper evidential foundation being laid. iii. The costs of the application shall await the final outcome. DATED, SIGNED AND DELIVERED IN NAIROBI THIS 21ST DAY OF MAY 2026. F. MUGAMBI JUDGE Delivered in presence of: Mungai for Maranga for applicant Court Assistants: Lillian & Gloria https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/6971/eng@2026-05-21 3

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