Juja Road Fancy Store Limited v Muthu Group of Hotels (MGM) & 7 others (Civil Case E634 of 2024) [2026] KEHC 6866 (KLR) (Commercial and Tax) (14 May 2026) (Ruling)

Juja Road Fancy Store Limited v Muthu Group of Hotels (MGM) & 7 others (Civil Case E634 of 2024) [2026] KEHC 6866 (KLR) (Commercial and Tax) (14 May 2026) (Ruling) Neutral citation: [2026] KEHC 6866 (KLR) Republic of Kenya In the High Court at Nairobi (Milimani Commercial Courts) Commercial and Tax Civil Case E634 of 2024 F Gikonyo, J May 14, 2026 Between Juja Road Fancy Store Limited Plaintiff and Muthu Group Of Hotels (MGM) Respondent and Sun Africa Hotels Limited 1st Defendant Muthu Holdings Management Limited 2nd Defendant Muthu Sovereign Management Limited 3rd Defendant Muthu Silver Springs Limited 4th Defendant Muthu Nyali Management Limited 5th Defendant Muthu Naivasha Management Limited 6th Defendant Muthu Keekorok Management Limited 7th Defendant Ruling 1.The 3rd, 7th and 8th respondents/ applicants filed the notice of motion dated 19.5.2025 seeking that the ex-parte judgment entered on 24.3.2025 and the consequential decree issued on 4.4.2025 be set aside ex debito justitiae. 2.They also seek leave to defend the suit out of time and that the annexed draft statement of defence is deemed duly filed and served, upon payment of the requisite court fees. 3.The application is supported by the affidavit sworn by Angela Muhia on 19.5.2025 and written submissions dated 30.9.2025. It is anchored in Order 10 Rule 11 of the Civil Procedure Rules. 4.The respondent opposed the application through a replying affidavit sworn by its director, Nipul Shah, on 6.6.2025. Applicant’s case 5.The gist of the application is that the applicants were not served with the summons to enter appearance and the plaint. 6.The applicants deposed that they learnt about the case on 12.5.2025 when the appointed auctioneers, Nairobi Connection Services Auctioneers visited its premises run by the 5th respondent and purported to proclaim their property pursuant to warrants of attachment issued by the court. 7.According to the applicants, the interlocutory judgment was entered on the basis that there was neither a memorandum of appearance nor defence filed. 8.The applicants contended that the service was effected on Mr. Ashwani Kadanga, who is not authorized to accept service of court process. 9.The applicants also contended that they have a bona fide and strong defence to the plaintiff’s claim. Their main arguments are that there was no contract for the supply of goods, no goods were delivered and the defence raises triable issues. 10.The applicants asserted that there would be no prejudice on the respondent if the application is allowed as the case would be heard on merits. 11.Thus, the applicant’s urged the court to allow their application. Response 12.The respondent contended that Ashwani Kadanga was at the time of service of the summons, a director of the 3rd, 7th and 8th applicants. 13.It asserted that the interlocutory judgment against the 3rd, 7th and 8th applicants is a regular and lawful judgment. 14.It relied on Order 5 Rule 3 of the Civil Procedure Rules to the effect that summons can be served upon either the company secretary, director or any principal officer of a company. 15.It contended that the draft statement of defence raises no triable issues and constitutes only mere denials. That the application is meant to delay its enjoyment of the fruits of the judgment. 16.It urged the court to dismiss the application with costs. Rejoinder 17.Through a further affidavit sworn by Angela Muhia on 30.9.2025, the applicants reiterated that they were not served with the summons and the plaint. 18.The applicants claimed that the affidavit of service sworn by Willis Agayi on 12.11.2024 was false because he did not disclose that he first introduced himself to the receptionist, a requirement by Silver Springs Hotel before direction to the appropriate office is given. 19.The applicants also claimed that a licensed process server would know that it is the company secretary who is authorized to receive all court documents on their behalf. 20.The applicants stated that whereas Mr. Agayi stated that he went to the legal office at 2nd floor, the legal office of Angela Muhua is not at the 2nd floor. 21.The applicants also challenged the deposition that the service of summons was upon “a white gentleman, Mr. Ashwani Kadanga” as he is not of Caucasian ethnicity. 22.The applicants relied on: -1.James Kanyiita Nderitu & Another v Marios Philotas Ghikas [2016] eKLR2.Frigoken Limited v Value Pak Food Limited [2011] KEHC 749 (KLR)3.Kenya National Private Security Workers Union v Vickers Security Services Limited [2024] KEELRC 13201 (KLR)4.Joel Gichana Nyamigwa v SDA (EA) Union Ltd [2017] eKLR5.Republic v Public Procument Regulatory Authority; Kenya Bureau of Standards & 2 others (Interested Parties); EAA Company Limited (Ex parte Applicant) [2023] KEHC 232 (KLR)6.Cecilia Karuru Ngayu v Barclays Bank of Kenya & Another [2016] KEHC 7064 (KLR) Analysis and Determination 23.Is there any sufficient reason to set aside the interlocutory judgment? 24.The court has discretion to set aside its own judgment, decree or order, for a sufficient reason, among others. Section 80 of the Civil Procedure Rules and Order 45 of the Civil Procedure Rules. 25.Of specific relevance is Order 10 Rule 11 of the Civil Procedure Rules which provides that: -“Where judgment has been entered under this Order the court may set aside or vary such judgment and any consequential decree or order upon such terms as are just.” 26.The courts discretionary power to set aside an interlocutory judgment ought to be exercised on principles according to the circumstances of the case. 27.The applicants have challenged service. 28.However, their contentions are disingenuous because they have admitted that the summons and plaint were served upon a person who was a director of the companies at the time of service. 29.The applicants did not seek to cross-examine the process server. 30.Courts have held that there is a presumption of service as stated in the process server’s report and that the burden lies on the person questioning it to show the return is incorrect. MB Automobile v Kampalla Bus Service [1966] EA 480 and Frigoken Limited v Value Pak Food Limited [supra] 31.For the above reasons, the court is not persuaded that the service was not properly effected upon the applicants. 32.The court is thus inclined to find that the impugned interlocutory judgment is a regular one; it is not an irregular one for setting aside ex debito justitiae. 33.In considering whether to set aside a regular interlocutory judgment: - the court has unfettered discretion in determining whether or not to set aside the default judgment, and will take into account such factors as the reason for the failure of the defendant to file his memorandum of appearance or defence, as the case may be; the length of time that has elapsed since the default judgment was entered; whether the intended defence raises triable issues; the respective prejudice each party is likely to suffer; whether on the whole it is in the interest of justice to set aside the default judgment, among other. James Kanyiita Nderitu & another v Marios Philotas Ghikas & another [supra] 34.The applicants contended that they have a bona fide and strong defence to the plaintiff’s claim. 35.But, the respondent was of the view that the draft statement of defence raises no triable issues and constitutes only mere denials. 36.The court has considered the draft statement of defence. The applicants argue that there was no written or oral contracts for the supply of goods allegedly supplied and that no goods were delivered. 37.The impleading may be seen as a mere denial because it is easier to deny there was ny contract between the parties. It may also constitute a triable issue of existence or otherwise of a contract between the parties. Making this a difficult scenario. Thus, it is expected that a party denying a contract should be able to provide some pointed material that would impel the court to wish an evaluation of their defence in a trial. 38.I will, nonetheless, give the plaintiffs the benefit of doubt that they have raised triable issues. 39.The further quest would be on the prejudice that the respondent may suffer as result of setting aside his judgment. 40.Both parties will have an opportunity to argue their respective cases on the merits and get justice. Secondly, an award of damages would sooth the respondent’s pain. 41.In the upshot, the application dated 19.5.2025 is allowed. Costs are awarded to the respondent; to be taxed or agreed between the parties and be paid within 14 days of taxation or agreement in order to ameliorate any prejudice on the respondent. I also add that strict compliance will be required of parties in all future processes to avoid wanton or deliberate delay of the case. DATED, SIGNED AND DELIVERED AT NAIROBI THROUGH MICROSOFT TEAMS ONLINE APPLICATION THIS 14TH DAY OF MAY, 2026-----------------------F. GIKONYO MJUDGEIn the presence of: -Ndegwa for 3rd, 7th and 8th defendantsOwuor for PlaintiffNo appearance by the other defendantsCA-Ivan/Aggrey