[2010] KEHC 1389 (KLR)
The court held that the applicant failed to establish any new or important matter that was not within its knowledge at the time the original order was made. The financial constraints and the issue of audit costs were matters that should have been, and likely were, canvassed before the previous judge. The court found...
Source-derived case information.
- Citation
- [2010] KEHC 1389 (KLR)
- Parties
- Applicant: Official Receiver and Provisional Liquidator of Pioneer Building Society (In Liquidation); Respondent: Mugo Mungai (on behalf of respondent)
- Court
- High Court
- Court Station
- High Court at Nairobi (Milimani Commercial Courts)
- Jurisdiction
- Kenya
- Case Number
- Winding Up Cause 5 of 1987
- Procedural Posture
- Winding Up Cause / Ruling on Application for Review of Previous Orders
- Outcome
- application dismissed with costs to the respondent
- Legal Topics
- Review of Court Orders, Liquidation Procedure, Costs of Audit, Forensic Audit Expenses
- Source Language
- english
Source-derived case record
Summary, issues, holding and outcome
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Parties
Official Receiver and Provisional Liquidator of Pioneer Building Society (In Liquidation)
Applicant
Mugo Mungai (on behalf of respondent)
Respondent
Procedural Posture
Winding Up Cause / Ruling on Application for Review of Previous Orders
Legal Issues
- 1 Whether the applicant has established sufficient grounds for review of the order made on 17th March 2009.
- 2 Whether lack of funds or the source of audit costs constitutes a new and important matter justifying review.
- 3 Whether failure to annex the order sought to be reviewed is fatal to the application.
Ratio Decidendi
The court held that the applicant failed to establish any new or important matter that was not within its knowledge at the time the original order was made. The financial constraints and the issue of audit costs were matters that should have been, and likely were, canvassed before the previous judge. The court found that these grounds do not justify review but rather constitute grounds for appeal. Additionally, the failure to annex the order sought to be reviewed rendered the application procedurally defective. Consequently, the application for review was found to lack merit and was dismissed with costs to the respondent.
Court Disposition
application dismissed with costs to the respondent
Orders
- The application for review is dismissed.
- Costs awarded to the respondent.
Full Case Text
Judgment text and source record
17 paragraphs
REPUBLIC OF KENYA IN THE HIGH COURT OF KENYA AT NAIROBI (MILIMANI COMMERCIAL COURTS) Winding Up Cause 5 of 1987
IN THE MATTER OF CAPITAL FINANCE LIMITED
RULING
1. By an order made on 17th March 2009 Khaminwa J. allowed the application dated 5th May 2008 in the following manner:-
i)That a professional forensic audit of the financial accounts and affairs of thePioneerBuildingSociety (In Liquidation) be carried out.
ii)That the Official Receiver and Provisional Liquidator of the said Pioneer Building Society (In Liquidation) render a detailed and property account of the affairs of Pioneer Building Society (in liquidation).
iii)That the costs of the professional forensic audit be borne by the Official Receiver and Provisional Liquidator of the said
PioneerBuildingSociety (In liquidation).
2. On16th June 2009the defendant filed the notice of motion under order 44 of the Civil procedure Rules and Section 3A of the Civil Procedure Act seeking for orders of the Review of the orders made onthe 17th March 2009. In particular they are seeking for the costs of the forensic audit be borne by the respondent and thereby a time limit for the said audit to be undertaken. This application is based on the grounds that the official receiver has no finances to pay the forensic audit.Secondly, the money available is not enough for the audit.Moreover, it belongs to other creditors contributories and share holders who the official receiver is accountable to and who have not allowed to forensic audit.This application is supported by the affidavit of P.K. Thoithi Kanyuira sworn on11th June 2009. He is the Senior Principal State Counsel with the Official Receiver.It is contended that a forensic audit is an expensive affair.The money held by the official receiver is Ksh.157,979. 10/-and fixed deposit of Ksh.2 million against several creditors owned millions of shillings.There are also shareholders and contributories who have not consented for this forensic exercise to be done.That is why the defendant seeks for an order that the costs of forensic audit be borne by the respondent.
2. This application was opposeds; Counsel for the respondent relied on the replying affidavit of Mugo Mungai sworn on12th January 2010. According Mr. Marete learned counsel for the respondent there are no new grounds or discovery of new facts to warrants the review of the order by Khaminwa J.The applicants has failed to obey the order therefore the official receiver should not any audience before this court.There are issues to be audited regarding the official receiver in the management of the winding up and the liquidation of the company.This application was also faulted for failure to annex the ruling the court or the order sought to be reviewed.For this reason the application was faulted and counsel urged the court to dismiss it. This application seeks for the review of the order of Khaminwa J. issued on17th March 2009. It is trite that an application for review must show there has been discovery of new and important matter or evidence which after due diligence was not within the applicant’s knowledge or could not have been produced at the time when the order or decree was passed.An applicant may also show that there is an error or mistake apparent on the face of the record or any other sufficient reason.The ground relied upon by the applicant is that there is no money to carry out the forensic audit.Moreover the money available belongs to the contributory and share holders.It is not stated in the affidavit in support of the application whether this is new matter.However these must have been the issues that were canvassed before Justice Khaminwa in the notice of motion dated 5th may 2008. The applicant’s should have known that forensic audit is an expensive affair and I believe those were the issues canvassed but the court granted the application.In my opinion that is not a proper ground for review but an appeal.Proceeding to review the order of Khaminwa J on that ground is tantamount to this court sitting on its own judgment.
3. On the issue of the merit of this application it is an established practice that a party seeking to review an order must obtain an extract copy of the orders sought to be reviewed and must annex it to the application so that the court can know the exact order or holding which the applicant is aggrieved of.See the case of Jiwanji vs Jiwanjai [1969 -30] KLR 34 where it was held that:
“That it is the duty of a party who wishes to appeal against or apply for a review of a decree or order to move the court to draw up an issue the formal decree or order.”
4. For the above reasons I find the application lacks merits and it is also bad in law.Accordingly, it is dismissed with costs to the respondents.
RULING READ AND SIGNE DON23RD JULY 2010ATNAIROBI.
M.K. KOOME
JUDGE
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