[2013] KEHC 5362 (KLR)

[2013] KEHC 5362 (KLR)

The court found that although the shareholders' agreement and the articles of association provided for arbitration of disputes, section 7(1) of the Arbitration Act expressly allows a party to seek interim measures of protection from the High Court even where an arbitration agreement exists. The plaintiff, as a shareholder and director, was entitled to seek injunctive relief to prevent his removal and interference with his duties, and the agreement itself did not preclude such recourse to the court. The court concluded that the application for stay of proceedings pending arbitration was not merited in the circumstances, as the plaintiff's application was for interim injunctive relief,...

Citation
[2013] KEHC 5362 (KLR)
Parties
Plaintiff: David Kabubii Kuria; Defendant: Bryan Eric Limited; Defendant: Tafi Enterprises Ltd; Defendant: Melde Vale Holdings Ltd; Defendant: Simon Kimutai; Defendant: Invesco Assurance Company Limited
Court
High Court
Court Station
High Court at Nairobi (Milimani Commercial Courts)
Jurisdiction
Kenya
Judgment Date
24 January 2013
Case Number
Civil Case 624 of 2012
Procedural Posture
Civil Case / Ruling on Application for Stay of Proceedings Pending Arbitration
Outcome
application dismissed
Judges
JB Havelock
Legal Topics
Arbitration Agreements, Shareholder Disputes, Injunctive Relief, Company Directorship, Interim Measures, Contractual Obligations
Source Language
English
Commercial and Corporate Civil Procedure Alternative Dispute Resolution Arbitration Agreements Shareholder Disputes Injunctive Relief Company Directorship Interim Measures +1 more

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Parties

David Kabubii Kuria

Plaintiff

Bryan Eric Limited

Defendant

Tafi Enterprises Ltd

Defendant

Melde Vale Holdings Ltd

Defendant

Simon Kimutai

Defendant

Invesco Assurance Company Limited

Defendant

Procedural Posture

Civil Case / Ruling on Application for Stay of Proceedings Pending Arbitration

Legal Issues

  1. 1 Whether the proceedings should be stayed pending arbitration as per the shareholders' agreement.
  2. 2 Whether the plaintiff is bound by the arbitration clause in the agreement or the company's articles of association.
  3. 3 Whether the plaintiff is entitled to seek interim injunctive relief from the court despite the arbitration agreement.

Ratio Decidendi

The court found that although the shareholders' agreement and the articles of association provided for arbitration of disputes, section 7(1) of the Arbitration Act expressly allows a party to seek interim measures of protection from the High Court even where an arbitration agreement exists. The plaintiff, as a shareholder and director, was entitled to seek injunctive relief to prevent his removal and interference with his duties, and the agreement itself did not preclude such recourse to the court. The court concluded that the application for stay of proceedings pending arbitration was not merited in the circumstances, as the plaintiff's application was for interim injunctive relief,...

Court Disposition

application dismissed

Orders

  • The fifth defendant's Chamber Summons dated 24 October 2012 is dismissed with costs to the plaintiff.