[2025] KEHC 7292 (KLR)

In re Fredrick Githutu Nganga (Commercial Miscellaneous Application E001 of 2023) [2025] KEHC 7292 (KLR) (21 May 2025) (Ruling)

Neutral citation: [2025] KEHC 7292 (KLR)

Republic of Kenya

In the High Court at Nakuru

Commercial Miscellaneous Application E001 of 2023

PN Gichohi, J

May 21, 2025

IN THE MATTER OF THE BANKRUPTCY ACT CAP 53 LAWS OF KENYA IN THE MATTER OF FREDRICK GITHUTU NGANGA

Ruling

1. Before this Court for determination is the Applicant’s Notice of Motion dated 8th June, 2023, brought under Section 108 of the Bankruptcy Act and seeking for Orders; -1. Spent.2. Spent.3. That this Honourable Court be pleased to stay proceedings in Nakuru CMCC No. 644 of 2020 Harun Mbitu Kamau v Fredrick Githutu Nganga t/a Genclose Commercial Agencies & Nakuru CMCC No. 192 of 2021 Joseph Kamiri Murima v Fredrick Githutu Nganga t/a Genclose Commercial Agencies pending the hearing and determination of this Bankruptcy proceedings.4. That cost of this application be the cause.

2. The application is supported by the grounds on the face of the application and the Supporting Affidavit sworn by the Applicant on 8th June, 2023. He states that his Creditors have obtained judgement against him which he is unable to pay. He states that the said creditors are in the process of executing the Decree and he stands to suffer irreparable loss and damage if the orders sought are not granted.

3. He admits being justly and truly indebted to Joseph Karimi Murima and Harun Mbitu Kamau in the aggregate sum of Kenya Shillings Seven Hundred and Seventy-Five Thousand Three hundred and Seventy-Six (Kshs.775,376/=).

4. He states that no Creditor has any security on his Estate, or any part thereof, for the payment of the said sum.

5. He depones that the creditors are in the process of issuing a warrant of attachment against him when he has already filed Bankruptcy proceedings following his inability to service the debt.

6. He beseeches this Court to stay proceedings in the lower Court pending the hearing and determination of the Bankruptcy suit herein.

7. Harun Mbitu, one of the Applicant’s creditors, has opposed the application vide his Replying Affidavit sworn on 24th July, 2023. He states that the Applicant’s Petition as presented ought to be struck out since it has been filed under the Bankruptcy Act, that was repealed.

8. Regarding the form of the Petition, he states that the Applicant has not annexed the Statement of Financial position setting out particulars of the debtor's creditors, debts, other liabilities and assets. He further states that the Applicant has not published the Petition in a newspaper of wide circulation and has failed to gazette the statement of financial position of the creditor, among others.

9. The Creditor therefore terms the Petition incompetent for non – compliance with any of the requirements stipulated in the law.

10. He contends that the Applicant seeks to have a second bite at the cherry after failing to comply with the Orders of the Court in a ruling issued on the 19th May, 2023 where Mohochi J directed the Petitioner to provide a Bank Guarantee of Kshs. 723,296/= from a reputable bank within 15 days of the ruling being made.

11. The Creditor reiterates that the application is premature as he has not demanded payment of the entire debt owed and that the Applicant has not furnished this Court with evidence of such demand.

12. He beliefs that the Applicant filed this bankruptcy petition to defeat his Creditors. He states that the Applicant had attempted to fraudulently transfer his property being title number Nakuru Municipality Block 22/1941 vide a sale agreement dated 27th February 2023, as well as Nakuru Municipality Block 15/873.

13. Accordingly, he asserts that the application is grossly defective and ought to be struck out for not complying with the legal requirements of obtaining a compliance certificate from the Official Registrar under the Business Registration Service. He prayed for the Application to be struck out.

Submissions 14. The Applicant made brief submissions dated 10th December, 2024, maintaining that he is unable to pay his debts due to circumstances that he entered into that has resulted to the closure of his business. He argues that he does not have any other source of income to meet his financial obligation.

15. He further submits that want of form does not invalidate his application. He thus prays for the application to be allowed as prayed.

16. On his part, the Creditor filed submission dated 30th April, 2024 and only on one issue, that is; whether the Application is merited.

17. He argues that this suit and proceedings have been filed in contravention of the provisions of applicable law, it therefore follows that it is misconceived, incompetent and a nullity and by reason of the same provisions, the court has no jurisdiction to entertain the suit and so it must be struck out with costs.

18. While disputing the argument that the misquoting of the applicable statute can be overlooked, the Creditor cited the case of Raila Odinga v I.E.B.C. & Others [2013] eKLR, where the Supreme Court held that Article 159(2)(d) of the Constitution was never meant to oust the obligation of litigants to comply with procedural imperatives as they seek justice from the court.

19. Further reliance was placed on the Supreme Court decision in Daniel Kimani Njihia v Francis Mwangi Kimani & another [2015] eKLR and Michael Mungai v Housing Finance Co. (K) Ltd &5 others [2017] eKLR that stressed that litigants must be clear as to the terms of the jurisdiction they are invoking and that they should invoke the correct constitutional or statutory provisions as failure to do so is not a mere technicality to be cured under Article 159 of the Constitution.

20. On that basis, the Creditor argues that the Applicant failed to cite the proper statute when filling the current application and has further failed to support his suit with the relevant documents, thus the application should be dismissed.

Analysis and Determination. 21. After considering the material before this Court, the issue for determination at this point is whether the orders should be issued staying proceedings pending determination of the Bankruptcy proceedings filed herein.

22. Despite being served with the Respondent’s detailed Replying Affidavit, the Applicant who is duly represented by an Advocate did not file any further Affidavit on the grave issues raised and therefore, the issues in the Replying Affidavit are not controverted.

23. It is not in dispute that the application herein is hinged on the Petition filed under the Bankruptcy Act which is now repealed. The Supreme Court has severally held that Article 159(2) (d) of the Constitution was never meant to oust the obligation of litigants to comply with procedural imperatives.

24. To be specific, the Apex Court in the case of Daniel Kimani Njihia supra at paragraph 15 held:-“Consequently, the only applicable sources of law when moving the Supreme Court are the Constitution, the Supreme Court Act, and the Supreme Court Rules, 2012. The Appellate Jurisdiction Act is not applicable when moving this Court. Neither is the Civil Procedure Code. In the Hermanus case, this Court had indicated how it should be moved, thus [paragraph 23]:“… It is trite law that a Court of law has to be moved under the correct provisions of the law.”Hence, without thus identifying the proper legal framework for the motion, an application is liable to be struck out.”

25. Similarly, the same Court held in Michael Mungai supra at paragraph 23 thereof:-“In the case of Hermanus Phillipus Steyn v Giovanni Gnnechi-Ruscone, Supreme Court, Application No. 4 of 2012, this Court was categorical that a Court has to be moved under a specific provision of the law. The Court stated that: it is trite law that a Court of law has to be moved under the correct provisions of the law. We reiterate that the only legal regime for the Supreme Court is the Constitution, the Supreme Court Act and the Supreme Court Rules, 2012 (as amended). Hence it is preposterous for the applicant to purport to bring his application under other statutory provisions that are not the Supreme Court Act. It is sadder that he has the audacity to even invoke provisions of repealed pieces of legislations. No court can be moved on the basis of a repealed law. What right if at all does a repealed law give? The answer is clear: none.”

26. The above Supreme Court decisions were followed by the Court of Appeal in Mariga & 2 others v Mariga & another (Civil Application E026 of 2023) [2024] KECA 470 (KLR) (26 April 2024) (Ruling). In the matter, the applicant moved the Court under Order 46 rule 6 of the Civil Procedure Rules instead of Order 50 rule 6 of the Civil Procedure Rules and also placed reliance upon Section 79(G) instead of Rule 4 of the Court of Appeal Rules and Fred Ochieng JA held:-“17. In this regard, the application is liable to be struck out having been hinged on the wrong provisions of the law.18. In the result, I find that the application before me is fatally defective and incompetent. The application is therefore struck out with no order as to costs.”

27. In this case, the Applicant has relied on the repealed Bankruptcy Act. The repealed law cannot give any right to the Applicant herein including the orders sought in this application.

28. On merit, the Applicant herein has argued that he is no longer able to pay the debt owing to his creditors and also that he instituted these Bankruptcy proceedings which are likely to be rendered nugatory.

29. This Court has looked at the annexures to the applications herein. One of them is a ruling by Mohochi J dated 19th May 2023 on two applications in High Court Misc. Application No. 132 of 2023. It is not clear whether orders of stay of execution of judgment in Nakuru CMCC No. 644 of 2020 were complied with yet they were to lapse upon default.

30. Despite the Respondent in application before this Court raising the issue of non-compliance by the Applicant in regard to the terms of the said ruling, there is no response from the Applicant herein.

31. In the circumstances, the application herein is grossly incompetent and therefore, the orders sought herein cannot be granted.

32. In short:-1. The application dated 8/6/2023 be and is hereby struck out.2. Costs to the Respondent.3. This Miscellaneous file is now marked as closed.

DATED, SIGNED AND DELIVERED AT NAKURU THIS 21ST DAY OF MAY, 2025. PATRICIA GICHOHIJUDGEIn the presence of:-Mr. Franklin Bosire for ApplicantN/A for Ms Cherono for RespondentNg’eno , Court Assistant