https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/5008

**REPUBLIC OF KENYA** **IN THE ENVIRONMENT AND LAND COURT OF KENYA** **AT MOMBASA** **ELC CASE NO. E058 OF 2022 (O.S.)** **CORNELIUS KAI CHILUMO & 94 OTHERS APPLICANTS** **VERSUS** **THE OFFICIAL RECEIVER, SUED AS THE PROVISIONAL** **LIQUIDATOR OF CONCORD INSURANCE CO. LTD** **(IN LIQUIDATION) 1ST RESPONDENT** **CONCORD INSURANCE CO. LTD 2ND RESPONDENT** **NARESH JAYANTILAL RANPURA 3RD RESPONDENT** **ABUBAKAR A. MANDY 4TH RESPONDENT** **JAMES NYAMORI OSORO 5TH RESPONDENT** **JOY NAITORE KIRIMI 6TH RESPONDENT** **JOSEPHINE MAWONDO MBULA 7TH RESPONDENT** **R U L I N G** 1. It is an old truth that a race is not won by the runner who, seeing the finish line, sits down and sends word that he has entered another race in another town. So too in law. A litigant who fears the ruling before him may not stop its delivery merely because he has, belatedly, filed elsewhere for the leave he ought to have sought at the start. To seek a remedy is not to hold it; and the mere filing of an application, in a far court, freezes nothing here. That, in a sentence, is the whole of the matter now before me. 2. An insurer named **Concord** ‘fell ill’ and, in **2020**, was placed in liquidation, its lands at ***Vikwatani*** passing to the Official Receiver to be shared among all to whom it owed. Upon eighteen of those parcels lived the settlers of **Plot No. 2038**, who claimed the years had made the land their own and sued to keep it — whereupon the Receiver stood in the doorway and said they had never sought the leave the law demands to sue a company in liquidation. That objection was argued, and this Court sealed its ruling and fixed it for the **5th of May 2026**; but before its delivery the settlers came running, not to hear the ruling, but to stop it, begging the Court to hold its hand until **Nairobi** should grant the leave they had belatedly gone to ask for. 3. **Introduction** 4. By an amended Originating Summons dated **5th November 2024** (the original bearing date **17th May 2022**), the applicants seek to be declared the owners, by way of adverse possession, of a large schedule of parcels at **Vikwatani** within **Kisauni**, registered in the name of **Concord Insurance Company Limited**. That substantive claim is not before me today. What is before me is a Notice of Motion by which the applicants ask this Court to hold back a ruling it is ready to deliver. 5. The respondents answered the suit not upon its merits but with a Notice of Preliminary Objection dated **14th April 2025**, whose single and piercing point is that the suit was commenced against a company in liquidation, and against its Liquidator, without the leave which the law imperatively demands. The ruling upon that objection stands reserved, and is now fixed for delivery on **17th September 2026**. 6. The story, shorn of ornament, is this. **Concord Insurance Company Limited**, the 2nd respondent, was placed under statutory management on **6th February 2013**. On **27th February 2020** a liquidation order was made, and the Official Receiver became its Liquidator. By operation of **section 444 of the Insolvency Act, 2015 (Cap 53)**, the Liquidator thereupon assumed control of all the property to which the company is or appears to be entitled, to be gathered in, preserved, and distributed among creditors according to law; and by **section 445** the Court may, upon the Liquidator’s application, direct that such property vest in him. 7. Among the assets so taken into the Liquidator’s control were seventy-five parcels of land at Vikwatani within Kisauni Constituency. Upon eighteen of those parcels, registered in the name of **Concord Insurance Company Limited**, the applicants — informal settlers who organised themselves as the “Committee of Plot No. 2038” — laid claim by way of adverse possession, and instituted this suit. 8. The 1st and 2nd respondents answered not with a defence on the merits but with the Preliminary Objection dated **14th April 2025**, contending that the suit had been commenced against a company in liquidation without the leave of the Court required by **section 432(2) of the Insolvency Act**. That objection was argued by written submissions, and this Court reserved its ruling and fixed it for **5th May 2026**, when it could not be delivered. The applicants, though directed on **4th February 2026** to file their submissions, filed none. 9. Then, on the threshold of the ruling, the applicants turned to **Nairobi**. Rather than await this Court’s decision, they filed ***Miscellaneous Application No. E486 of 2026*** seeking the very leave whose absence is the gravamen of the objection, and now ask this Court to stay its hand until **Nairobi** has spoken. 10. **The Applicants’ Notice of Motion dated 1st May 2026** 11. By a Notice of Motion dated **1st May 2026**, brought under Order 50 Rule 6 of the Civil Procedure Rules, sections 1A, 1B and 3A of the Civil Procedure Act, and Article 159(2)(d) of the Constitution, the applicants pray: **a. *Spent.*** **b. *That this Honourable Court be pleased to stay the ruling slated for delivery pending the hearing and determination of this application;*** **c. *That this Honourable Court be pleased to stay the ruling pending the hearing and determination of Miscellaneous Application No. E486 of 2026 at the Milimani High Court, Nairobi (Commercial and Tax Division);*** **d. *That the time for filing the applicants’ written submissions be extended, and that such submissions be filed only after the determination of the said Nairobi Miscellaneous Application; and*** **e. *That the costs of this application abide the cause.*** 1. The motion is premised upon the grounds on its face and the supporting affidavit of **Pauline Wasai Mbori**. Its central plank is that the applicants have filed, at **Nairobi**, ***Miscellaneous Application No. E486 of 2026*** seeking leave under **section 432 of the Insolvency Act, 2015** to file suit against the **1st** and **2nd** respondents; that it is only fair and just that they be afforded a chance to seek that leave before this Court delivers its ruling; and that, invoking **Article 159(2)(d)** of the Constitution and the oxygen principle, the respondents will suffer no prejudice if the indulgence is granted. They lean upon ***Moses Mwicigi & 14 others v Independent Electoral and Boundaries Commission & 5 others (Petition 1 of 2015) [2016] KESC 2 (KLR)***. 2. **The 1st Respondent’s Response** 3. The application is stoutly opposed. By a replying affidavit sworn on **8th July 2026** by **Judy Mogo**, the Senior Assistant Official Receiver, the **1st** respondent deposes that **Concord Insurance Company Limited** was placed under statutory management on **6th February 2013** by the Commissioner of Insurance, and thereafter under liquidation on **27th February 2020**, the Official Receiver being appointed its Liquidator. 4. It is the respondents’ case that the entire suit is built upon sand, for the applicants commenced these proceedings against a company in liquidation, and against its Liquidator, without first obtaining the leave required under the **Insolvency Act, 2015**; that, though directed on **4th February 2026** to file submissions on the objection, the applicants filed none; and that, rather than await the ruling, they filed the Nairobi **Miscellaneous Application No. E486 of 2026**, itself now met with a Preliminary Objection dated **11th June 2026**, and then returned to this Court to stay the very ruling they fear. 5. The respondent urges that the sequence of events is no *bona fide* step in compliance with the statute but a collateral attempt to avoid, delay and circumvent a ruling already pending, and to cure the very defect raised by the objection. The mere filing of the **Nairobi** application, it is said, amounts to no leave, approval or authority; and no order granting leave has been exhibited. A stay of the delivery of a reserved ruling, the respondent contends, is an exceptional and discretionary remedy, not to be had merely because a party has filed something in another court, and the applicants have shown neither exceptional circumstance, nor prejudice, nor that the **Nairobi** matter would be rendered nugatory by delivery of this ruling. The motion, in short, is said to be an abuse of the process of the Court. 6. **Issues for Determination** 7. Having considered the application, the response, and the record, the questions that fall for determination are these: (i) Whether this Court should stay the delivery of its reserved ruling upon the Preliminary Objection dated **14th April 2025**, now fixed for **17th September 2026**, pending the hearing and determination of ***Nairobi Miscellaneous Application No. E486 of 2026***; (ii) Whether time ought to be enlarged for the filing of the applicants’ written submissions; and (iii) Whether the application is, in its true character, an abuse of the process of the Court. **E. Analysis and Determination** ***(i) Whether the delivery of the reserved ruling should be stayed*** 1. I begin with first principles, for they light the whole path. A ruling that a court has written, reserved, and fixed for delivery is not a loose thread to be tugged at the pleasure of a party who fears its contents. The delivery of a reserved decision is the culmination of the judicial act; to stay it is to arrest justice at the very moment of its birth. Such an order is therefore exceptional, and it will not be made save for the weightiest of reasons, upon a trilogy of conditions as I see it — that the applicant demonstrate sufficient cause, that real prejudice or substantial loss would otherwise befall him, and that the stay would serve, rather than obstruct, the ends of justice. 2. What is offered here to satisfy that trilogy? Only this: that the applicants have filed, elsewhere, an application for leave to sue the company in liquidation. But leave to sue and the filing of an application for leave are two very different things, as different as a key and the wish for a key. The one opens the door; the other merely knocks upon it. The law upon this point is settled and stern. **Section 432(2) of the Insolvency Act, 2015** provides: *“When a liquidation order has been made or a provisional liquidator has been appointed, legal proceedings against the company may be begun or continued only with the approval of the Court and subject to such conditions as the Court considers appropriate.”* 1. The meaning of that provision has been declared again and again. In ***Jatomy Supermarkets Limited v Kenafric Industries Limited & 2 others [2025] KEHC 3141 (KLR)***, the Court observed that ***“once a liquidation order has been made, any legal proceedings against the company cannot proceed without first obtaining the court’s approval,”*** the requirement being ***“meant to protect the integrity of the liquidation process and prevent unnecessary or improper interference in the administration of the company’s assets.”*** To like effect is ***Karuturi Limited (In Receivership) & 2 others v Shri Krishna Overseas Limited (Civil Appeal E055 of 2021) [2024] KEHC 6359 (KLR)***, in which it was held that where ***“leave was required to file, and there was none, then there cannot have been a competent suit without such leave,”*** approving the earlier holding in ***Alex Ngugi Mwaura & another v Gikumba Investment Limited*** that leave must be obtained *before* the suit is instituted. 2. It follows that the applicants’ suit, as presently constituted, stands upon a defect that goes to its very competence. And the burden of establishing that leave was obtained lies upon the party who instituted the suit, for he who alleges must prove. The applicants have shown no order of any court granting them leave. They have shown only that they have *asked* for it, and that in a distant forum. To stay the delivery of a reserved ruling upon the strength of an unheard, undetermined application filed elsewhere would be to let the tail wag the dog — to allow a litigant, by the simple expedient of filing something, somewhere, to freeze the hand of the court seized of the matter. That I decline to do. 3. I would add this. If the Nairobi court grants leave, the applicants are not without a remedy; the law knows well how to give effect to leave once obtained. But if this Court were to stay its ruling and Nairobi were to refuse leave, the applicants would have gained nothing but delay, and the respondents would have lost the finality to which they are entitled. The stay sought is, in truth, a bridge to nowhere. There being no order of leave and no order of stay from Nairobi placed before me, the foundation for the prayer simply does not exist. 4. Nor does the authority pressed by the applicants carry them further. ***Moses Mwicigi & 14 others v Independent Electoral and Boundaries Commission & 5 others*** (Petition 1 of 2015) **[2016] KESC 2 (KLR)** speaks to the duty of a court to do substantive justice and not to sacrifice merit upon the altar of procedure. It says nothing of a statutory precondition to the very competence of a suit. A rule of practice may be relaxed; a condition which Parliament has made the gateway to the seat of judgment may not. ***(ii) Whether time should be enlarged for filing submissions*** 1. The applicants were directed, on **4th February 2026**, to file their written submissions upon the Preliminary Objection. They did not. They offer no explanation for that omission beyond their preoccupation with the **Nairobi** application. Enlargement of time is not a right to be claimed but a discretion to be earned, and it is earned by the showing of sufficient cause. Here there is none. 2. More fundamentally, the prayer is now spent. The objection has been argued, and the ruling written and reserved. To reopen the door for submissions at this hour, after the Court has already reasoned its way to a decision, would be to unmake work lawfully done and to invite the very mischief the rules of orderly procedure exist to prevent. Whatever the merits of the objection — and upon those merits I say nothing here — the time for submissions has closed. The prayer for enlargement is therefore refused. ***(iii) Whether the application is an abuse of the process of the Court*** 1. There remains the gravest of the three questions. I approach it with care, for it is a serious thing to brand a litigant’s application an abuse of process. Yet the shape of these proceedings speaks with a clarity that is difficult to mistake. 2. Consider, first, the timing. A party faced with an imminent adverse ruling files, at the eleventh hour, a fresh application in a distant court seeking the very thing whose absence founds the objection, and then asks the court seized of the matter to stand still. The 2nd respondent was placed under liquidation as long ago as **27th February 2020**; the applicants had ample time to seek leave, yet stirred only when the objection threatened their suit with dismissal. The urgency they now press is of their own making, and I find that a party cannot manufacture urgency by his own delay and then invoke it as a ground for indulgence. A self-inflicted wound is no passport to the Court’s discretion. 3. Consider, secondly, the manner of the **Nairobi** application. Upon a perusal of ***Miscellaneous Application No. E486 of 2026***, the supporting affidavit is framed as though no suit had yet been filed — the applicants there deposing that they “seek leave from this honourable court to enable us file a suit of adverse possession against the respondents before the ELC, Mombasa.” That is not a candid account. A suit had already been filed in this Court, and filed without leave; and the applicants did not annex that **Nairobi** application to the motion now before me, so that its terms might be weighed. I make no finding of deliberate deceit, but I am bound to record that this is a material non-disclosure of a matter the other court was entitled to know, and it does the applicants’ cause no credit. 4. Consider, thirdly, the choice of forum. The leave sought concerns a suit long pending in Mombasa, yet the applicants went to Nairobi to seek it, offering no reason why a court of coordinate jurisdiction at the Coast could not have been approached. The pursuit of the same relief in a distant forum, where the pendency of these proceedings might pass unnoticed, wears the appearance of forum shopping, against which the courts have always set their face. And where a litigant, having engaged one process, seeks to achieve the same end by another and collateral route, the courts will not permit it. In ***County Government of Kitui v Hon. Justice (Rtd) Edward Torgbor & another*** (Civil Appeal 176 of 2020) **[2026] KECA 121 (KLR)**, the Court of Appeal struck down just such a manoeuvre, holding that a party is not entitled to a “second bite at the cherry” by reformulating its cause of action, and that the attempt is an abuse of the process of the court. Taken together — the eleventh-hour timing, the want of candour, and the improper choice of forum — these features persuade me that the motion is, in its true character, an abuse of the process of the Court. 5. This brings me to **Article 159(2)(d)** of the Constitution, the applicants’ sheet-anchor. That Article commands that justice be administered without undue regard to procedural technicalities. It is a noble provision, and I honour it. But it is not, and was never meant to be, a magic wand. The Supreme Court in ***Nicholas Kiptoo Arap Korir Salat v Independent Electoral and Boundaries Commission & 7 others [2015] KESC 31 (KLR)*** held that **Article 159** accords precedence to substance over form, yet is no charter for the destruction of the rules. And **Kiage JA**, in the Court of Appeal in the same matter, ***Nicholas Kiptoo Arap Korir Salat v Independent Electoral and Boundaries Commission & 6 others [2013] KECA 113 (KLR)***, spoke with a clarity I gratefully adopt: he was ***“not in the least persuaded that Article 159 of the Constitution and the oxygen principles … were ever meant to aid in the overthrow or destruction of rules of procedure and to create an anarchical free-for-all in the administration of justice.”*** 6. The distinction is between a technicality and a nullity, between a stumble of form and a defect of substance. **Article 159** will lift the litigant who has stumbled over a procedural pebble; it will not carry the litigant who has walked past a statutory wall. As the Supreme Court reminded us in ***Raila Odinga & 5 others v Independent Electoral and Boundaries Commission & 3 others (Petition 5, 3 & 4 of 2013 (Consolidated)) [2013] KESC 1 (KLR)***, the Article ***“was never meant to oust the obligation of litigants to comply with procedural imperatives as they seek justice.”*** The requirement of leave under **section 432(2)** is no mere pebble. It is a substantive command of statute, protecting the orderly and *pari passu* winding-up of an insolvent estate for the benefit of all its creditors. To cure its absence by incantation of **Article 159** would be to use the Constitution to defeat a statutory dictate the Constitution itself requires the courts to uphold. ***(iv) A Word on the Record*** 1. The respondents draw attention to a discrepancy: the application is headed as brought by **95** persons, yet, they say, the true number of applicants on the record is **56**. A court must be told the truth in matters great and small, and the parties will be expected, going forward, to reconcile the record so that the Court and the opposing side know precisely who stands before it. I make no finding of deliberate misleading, but I note the discrepancy and direct that it be regularised in the terms of order (d) below. **F. Conclusion and Disposal Orders** 1. Standing back and surveying the whole, I am satisfied that the applicants have laid no proper foundation for the extraordinary orders they seek. The delivery of a reserved ruling will not be stayed upon the strength of an unheard application for leave filed elsewhere; time will not be enlarged for submissions after the ruling has been reasoned and reserved; and the Court will not lend its process to a manoeuvre whose evident purpose is delay. It is the applicants’ own suit, yet it is they who would delay it; and the Court sees no tangible or pragmatic reason to withhold the ruling it stands ready to deliver. **Article 159** does not rescue a suit that wants the leave which statute makes its very condition of life. 2. The upshot is that the Notice of Motion dated **1st May 2026** lacks merit. Accordingly, I make the following orders: ***(a) The Notice of Motion dated 1st May 2026 is dismissed in its entirety.*** ***(b) The Court’s reserved ruling upon the Preliminary Objection dated 14th April 2025 shall be delivered on 17th September 2026, or on such other date as the Deputy Registrar shall notify to all parties.*** ***(c) The costs of this application shall be borne by the applicants and are awarded to the 1st and 2nd respondents.*** ***(d) The applicants shall, within fourteen (14) days of the date hereof, file and serve a schedule reconciling the names of the persons on record as applicants herein.*** It is so ordered. This Ruling is dated and signed at Mombasa, and delivered virtually via Microsoft Teams this **30th day of July, 2026.** \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ **B. A. AKELLO, OGW** **JUDGE** **Ruling read in the presence of***:* Osoro for the Applicants Mugo for the 1st and 2nd Respondents Gillian Mutamba Court Assistant