[2011] KEHC 1716 (KLR)

[2011] KEHC 1716 (KLR)

The court found that the lease agreement dated 23rd May, 2007, which contained the arbitration clause, was no longer operative at the time of the dispute. The relationship between the plaintiff and the 1st defendant had changed from that of lessees under a lease to that of shareholder and company. The subject matter...

Source-derived case information.

Citation
[2011] KEHC 1716 (KLR)
Parties
Plaintiff: Jitendra Gosrani; Defendant: Amber Apartments Ltd; Defendant: I.S. Matharu; Defendant: Rashid Sumar
Court
High Court
Court Station
High Court at Nairobi (Milimani Law Courts)
Jurisdiction
Kenya
Case Number
Civil Suit 148 of 2011
Procedural Posture
Civil Suit / Ruling on Application to Stay or Strike Out Suit and Refer Dispute to Arbitration
Outcome
application dismissed
Legal Topics
Arbitration Clauses, Shareholder Rights, Company Property Disputes
Source Language
en
Civil Procedure Commercial and Corporate Arbitration Clauses Shareholder Rights Company Property Disputes

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Parties

Jitendra Gosrani

Plaintiff

Amber Apartments Ltd

Defendant

I.S. Matharu

Defendant

Rashid Sumar

Defendant

Procedural Posture

Civil Suit / Ruling on Application to Stay or Strike Out Suit and Refer Dispute to Arbitration

  1. 1 Whether the dispute between the parties is governed by the lease agreement dated 23rd May, 2007 and its arbitration clause.
  2. 2 Whether the suit should be stayed or struck out and referred to arbitration under the lease agreement.
  3. 3 Whether the relationship between the plaintiff and the 1st defendant is governed by the lease agreement or by shareholding in the company.

Ratio Decidendi

The court found that the lease agreement dated 23rd May, 2007, which contained the arbitration clause, was no longer operative at the time of the dispute. The relationship between the plaintiff and the 1st defendant had changed from that of lessees under a lease to that of shareholder and company. The subject matter of the dispute—damage to the plaintiff's vehicles and rights over parking spaces—arose from the plaintiff's shareholding and not from the lease agreement. Therefore, the arbitration clause in the lease agreement did not apply, and there was no basis to stay or strike out the suit or refer it to arbitration. The application by the defendants was found to be without merit and...

Court Disposition

application dismissed

Orders

  • The defendants' application to stay or strike out the suit and refer the dispute to arbitration is dismissed.
  • Each party shall bear their own costs of the application.