[2001] KEHC 870 (KLR)
The court found that the defendants had demonstrated a bona fide triable issue regarding whether they were the actual contracting parties with the plaintiff. The court emphasized the principle of separate legal personality, noting that it is not plain and obvious that a managing director, by signing on behalf of a...
Source-derived case information.
- Citation
- [2001] KEHC 870 (KLR)
- Parties
- Plaintiff: Fursys (K) Limited; Defendant: The Da Gama Rose Group of Companies Ltd.; Defendant: Horatious Da Gama Rose
- Court
- High Court
- Court Station
- High Court at Nairobi (Milimani Law Courts)
- Jurisdiction
- Kenya
- Case Number
- Civil Case 205 of 2001
- Procedural Posture
- Civil Case / Ruling on Application for Summary Judgment/unconditional Leave to Defend
- Outcome
- Plaintiff's application for summary judgment rejected; defendants granted unconditional leave to defend; costs awarded to defendants.
- Legal Topics
- Company Personality, Summary Judgment, Leave to Defend, Contractual Parties
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Fursys (K) Limited
Plaintiff
The Da Gama Rose Group of Companies Ltd.
Defendant
Horatious Da Gama Rose
Defendant
Procedural Posture
Civil Case / Ruling on Application for Summary Judgment/unconditional Leave to Defend
Legal Issues
- 1 Whether the defendants have demonstrated a bona fide triable issue as to whether they were the contracting parties with the plaintiff.
- 2 Whether the 2nd defendant, as Managing Director, can be personally enjoined in a suit against the company.
- 3 Whether the introduction of 'Sympony' as a contracting party is a genuine issue or a strategy to delay the suit.
Ratio Decidendi
The court found that the defendants had demonstrated a bona fide triable issue regarding whether they were the actual contracting parties with the plaintiff. The court emphasized the principle of separate legal personality, noting that it is not plain and obvious that a managing director, by signing on behalf of a company, incurs personal liability. The court also found that the introduction of 'Sympony' as a contracting party was not a strategy to delay the proceedings, as both the plaintiff and its counsel were aware of its identity and role. Consequently, the court rejected the plaintiff's application for summary judgment and granted the defendants unconditional leave to defend the suit.
Court Disposition
Plaintiff's application for summary judgment rejected; defendants granted unconditional leave to defend; costs awarded to defendants.
Orders
- Plaintiff's motion is rejected.
- Defendants are granted unconditional leave to defend.
Full Case Text
Judgment text and source record
16 paragraphs
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA AT NAIROBI
MILIMANI COMMERCIAL COURTS
CIVIL CASE NO. 205 OF 2001
FURSYS (K) LIMITED ……………………………………. PLAINTIFF
VERSUS
THE DA GAMA ROSE
GROUP OF COMPANIES LTD. ............................. 1ST DEFENDANT
HORATIOUS DA GAMA ROSE …………………... 2ND DEFENDANT
RULING
Having heard the parties and their submissions, I find that on the correspondence and agreements annexed to the affidavits the defendants have shown a bona fide triable issue on whether or not they were the contracting parties with the plaintiff. I don’t want to say more than that where a person signs as a Managing Director of a limited liability company, it is not plain and obvious that he and not that company or that he and the company can be enjoined in a suit against the company. That would appear to run counter to the basic foundations of company law in the separate and distinct personality and existence of the company and its Directors and/or shareholders.
It is also apparent from the correspondence that the defendants stand that “sympony” which is identified as the contracting party in the agreements relied upon and which is the business name of System Integration Ltd. is not introduced in the defendant’s proposed defence as a chameleon strategy to delay the finalisation of the suit. And it is not a trick practiced on the plaintiff. Both the plaintiff itself and their counsel were fully aware of its identity and liability in the matter giving rise to the contract.
In the result, I must reject to plaintiff’s motion with costs to the defendants whom I give unconditional leave to defend. I shall resist the temptation to order amendments to the plaintiff’s plaint. I leave it to the plaintiff to weigh whether to proceed with the suit as presently framed or to amend the same.
Dated at Nairobi this 16th July, 2001.
A.RINGERA
JUDGE