[2009] KEHC 64 (KLR)
The court found that Mr. Yehuda Sulami was a bona fide director of the plaintiff company at the time the suit was filed, as evidenced by the Notification of Change of Directors that was received and receipted by the Registrar of Companies prior to the filing of the suit. The court held that the absence of a formal...
Source-derived case information.
- Citation
- [2009] KEHC 64 (KLR)
- Parties
- Plaintiff: Free Holiday Limited; Defendant: OZ Netzan
- Court
- High Court
- Court Station
- High Court at Mombasa
- Jurisdiction
- Kenya
- Case Number
- Civil Case 167 of 2007
- Procedural Posture
- Civil Case / Ruling on Notice of Motion to Strike Out Suit
- Outcome
- application dismissed
- Judges
- JV Juma
- Legal Topics
- Company Directors Authority, Striking Out Suits, Verifying Affidavits, Corporate Locus Standi
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Free Holiday Limited
Plaintiff
OZ Netzan
Defendant
Procedural Posture
Civil Case / Ruling on Notice of Motion to Strike Out Suit
Legal Issues
- 1 Whether the suit should be struck out for being an abuse of process and for lack of authority by the person instituting it.
- 2 Whether the verifying affidavit was sworn by a person with proper authority as a director of the plaintiff company.
- 3 Whether failure to provide a company resolution authorizing the suit renders the suit fatally defective.
Ratio Decidendi
The court found that Mr. Yehuda Sulami was a bona fide director of the plaintiff company at the time the suit was filed, as evidenced by the Notification of Change of Directors that was received and receipted by the Registrar of Companies prior to the filing of the suit. The court held that the absence of a formal company resolution authorizing the institution of the suit was a matter of evidence and did not render the suit so defective as to warrant striking it out. The court concluded that the suit was properly filed and before the court, and therefore dismissed the application to strike out the suit in its entirety.
Court Disposition
application dismissed
Orders
- The application to strike out the suit is dismissed in its entirety.
- The matter shall proceed to hearing.
Full Case Text
Judgment text and source record
26 paragraphs
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA
AT MOMBASA
Civil Case 167 of 2007
FREE HOLIDAY LIMITED……………..………………………… PLAINTIFF
VERSUS
OZ NETZAN ……………………………………………………….. DEFENDANT
RULING
This is a Notice of Motion dated 19th November 2007 filed by the Defendant/Applicants seeking inter alia the following orders:-
“2. THAT this Honourable Court be pleased to strike out this suit for being an abuse of the process of the court and for having been brought without authority.
3. THAT the ex-parte orders granted hereinand subsequently extended thereafter bevacated and/or set aside”
In his supporting affidavit one OZ Nitzan the Defendant/Applicant in this case avers that the verifying affidavit sworn by one Mr. Yehuda Sulami in support of the plaint dated 17th July 2007is a falsehood. Further the said Mr. Yehuda Sulami not being a director of the Plaintiff company has no authority to institute this suit. The Applicant therefore argues that the present suit having no basis in law or fact must of necessity be struck out. The application was opposed by the Plaintiff/Respondent who filed his Grounds of Opposition on15th October 2007. The matter was listed before court for inter partes hearing on10th June 2009. By consent both counsel agreed to put in written submissions which they sought to rely on entirely. These submissions were duly filed and are on record.
In support of his application the Applicant annexed a letter from the department of the Registrar-General dated 5th September 2007 which letter lists the names of the two directors of the Plaintiff company Free Holiday Limited as –
§Yosef Guzi
§Catherine Mwihaki Ngambi
It is trite law that a company is indeed an artificial person and may only act through its duly registered office bearers. The Plaintiff is indeed a company and as such may only sue or be sued through its directors. Mr. Kiarie Kariuki in his submissions on behalf of the Applicant dated 18th June 2009argues that the Respondent has not availed any evidence to show that he had authority to bring the suit. With respect this is not the correct position. In his replying affidavit to this application dated 4th December 2007 the Plaintiff has attached YS3 which is a Notification of Change of Directors indicating that with effect from 29th May 2009 Yehuda Sulami and Hanan Adini were appointed as Directors of the Plaintiff company. There is evidence that this Notification was received by the office of the Registrar of Companies and was receipted on9th July 2007. Therefore by17th July 2007 when the Plaintiff swore his verifying affidavit he was infact a bona fide director of the company and had taken all necessary steps to have that change registered. The failure of the Registrar to record this change cannot in any way be blamed on the Plaintiff.
The issue of a company resolution authorizing the institution of the suit is in my view a matter of evidence and which in any event does not render the suit so defective as to be struck out. It is enough that the Plaintiff was a bona fide director at the time the suit was filed. The Plaintiff is at liberty to avail the necessary resolutions at the hearing of the suit. I therefore find that this suit is properly filed and is properly before court. The application to strike out is hereby dismissed in its entirety and I do direct that the matter proceed to hearing. Costs in the cause.
Dated and Delivered atMombasa this 14th day of December 2009.
M. ODERO
JUDGE
Read in open court in the presence of:
Mr. Mutugi holding brief for Mr. Munyithya for Plaintiff/Respondent
Ms. Obura holding brief for Mr. Kiarie for Applicant
M. ODERO
JUDGE
14/12/2009