https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/11176

**REPUBLIC OF KENYA** **THE HIGH COURT OF KENYA AT NAIROBI** **COMMERCIAL & ADMIRALTY DIVISION** **MISCELLANEOUS APPLICATION NO. 831 OF 2026** **IN THE MATTER OF DIAMOND TRUST BANK KENYA LIMITED** **AND** **IN THE MATTER OF THE COMPANIES ACT. NO. 17 OF 2015** **AND** **IN THE MATTER OF AN APPLICATION FOR EXTENSION OF TIME FOR REGISTRATION OF REPLACEMENT CHARGE. FURTHER CHARGE AND SECOND FURTHER CHARGE IN FAVOUR OF DIAMOND TRUST BANK KENYA LIMITED IN SUPPORT OF THE BORROWINGS BY PALM VALLEY DEVELOPMENT LIMITED** **RULING** 1. This Ruling is in respect to the Applicant's Notice of Motion dated 14th July, 2026, brought under Sections 878, 885, and 888 of the Companies Act No. 17 of 2015, and Order 51 Rule 1 of the Civil Procedure Rules (2010). The Motion seeks the following orders: *1.) THAT this matter be certified as urgent and service thereof be dispensed with in the first instance and the same be heard ex parte.* *2.) THAT the time for registration be extended by 30 days at the Companies Registry of the following charges, namely:* *(a) a Replacement Charge dated 6th January, 2026, securing the principal sum of Kenya Shillings Five Hundred Million (Kshs. 500,000,000/=), registered at the Land Registry on 12th June, 2026;* *(b) a Replacement Further Charge dated 6 January, 2026, securing the principal sum of Kenya Shillings Five Hundred Million (Kshs. 500,000,000/=), registered at the Land Registry on 12 June, 2026; and* *(c) a Replacement Second Further Charge dated 6th January, 2026, securing the principal sum of Kenya Shillings Three Hundred and Thirty Million (Kshs. 330,000,000/=), registered at the Land Registry on 12th June, 2026.* *(3.) THAT there be no order as to costs.* 2. The Application is supported by the affidavit of **Julius Odhiambo Okumu**, an Advocate of the High Court of Kenya practicing with the firm of **Messrs Mohamed Madhani & Co. Advocates LLP**, who has personal conduct of this matter and is duly authorized by the Applicant to swear the affidavit. **Issues for Determination** 3. Upon consideration of the Application, the supporting affidavit, and the legal provisions relied upon, the sole issue that arises for determination is * + 1. *Whether leave should be granted to register the Replacement Charge, Replacement Further Charge, and Replacement Second Further Charge over Title Number KIAMBU/MUNICIPALITY/BLOCK7/26 at the Companies Registry out of time.* **Analysis** 4. Pursuant to **Section 884 of the Companies Act**, the Registrar of Companies is mandated to maintain a register of charges, register such charges, issue certificates of registration thereof, and authenticate the same with the Registrar's Official Seal. **Under Section 885 of the Act**, the statutory timeline for registration of a charge is thirty (30) days from the date of its creation. In the event of non-compliance, **Section 888(1) of the Companies Act** empowers any interested party or the company itself to apply to the Court for an extension of the prescribed period for registration. 5. When considering an extension under **Section 888**, the Court examines whether the delay was accidental or reasonably explained, whether it prejudiced creditors or members, whether granting the extension is just and fair, and whether the omission is rectifiable. 6. Counsel for the Applicant has explained that delays were occasioned by the process of conversion of title consequent upon georeferencing of the units erected on the Title, which caused a delay in finalizing registration of the Charges at the Lands office. As a result, the registration of the Charges at the Registry of Companies could not be undertaken until the process at the Registry of Lands was finalized, meaning stamping and registration formalities could not be completed within the statutory 30-day period. The Charges were eventually registered at the Land Registry on 12th June, 2026. 7. The failure to register the Charges within time was occasioned by extraneous circumstances beyond the control of the Applicant and its advocates on record, and not as a result of negligence or want of care. There is no evidence to suggest that the delay has prejudiced any party; rather, the Applicant remains exposed should it fail to register the Charges as required under the law. 8. The purpose of registering a charge is to safeguard the chargee's and creditors' interests. Inadvertent procedural delays beyond a party's control should not invalidate an otherwise valid charge, in line with Article 159 of the Constitution and the Companies Act, which promote substantive justice over technicalities. 9. In view of the foregoing, it would be just, fair, and equitable that the omission should not be visited upon the Applicant, who stands to suffer undue prejudice to its banking arrangements with the Chargor if the extension is not granted. Accordingly, the prayers sought in the Notice of Motion dated 14th July, 2026 are hereby granted. Given the nature of the application, there shall be no order as to costs. **Determination** 10. The Applicant’s application by way of a Notice of Motion dated 14th July, 2026 is allowed in the following terms: *1.) THAT this matter be certified as urgent and service thereof be dispensed with in the first instance and the same be heard ex parte.* *2.) THAT the time for registration be extended by 30 days at the Companies Registry of the following charges, namely:* *(a) a Replacement Charge dated 6th January, 2026, securing the principal sum of Kenya Shillings Five Hundred Million (Kshs. 500,000,000/=), registered at the Land Registry on 12th June, 2026;* *(b) a Replacement Further Charge dated 6 January, 2026, securing the principal sum of Kenya Shillings Five Hundred Million (Kshs. 500,000,000/=), registered at the Land Registry on 12 June, 2026; and* *(c) a Replacement Second Further Charge dated 6th January, 2026, securing the principal sum of Kenya Shillings Three Hundred and Thirty Million (Kshs. 330,000,000/=), registered at the Land Registry on 12th June, 2026.* *3.) THAT there be no order as to costs.* 11. It is so ordered. 12. The file is **HEREBY** marked as closed. **DATED, SIGNED AND DELIVERED AT MILIMANI THIS 22ND DAY OF JULY, 2026.** **NJOROGE BENJAMIN K.** **JUDGE**