https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/9492

In re KCB Bank Kenya Ltd (Miscellaneous Application E739 of 2026) [2026] KEHC 9492 (KLR) (Commercial and Tax) (26 June 2026) (Ruling) Neutral citation: [2026] KEHC 9492 (KLR) Republic of Kenya In the High Court at Nairobi (Milimani Commercial Courts) Commercial and Tax Miscellaneous Application E739 of 2026 MO Ado, J June 26, 2026 IN THE MATTER OF KCB BANK KENYA LIMITED AND IN THE MATTER OF SECTION 888 OF THE COMPANIES ACT, 2015 AND IN THE MATTER OF AN APPLICATION FOR EXTENSION OF TIME FOR REGISTRATION OF A CHARGE Ruling 1.The Applicant, KCB Bank Kenya Limited, moved this Court by a Notice of Motion dated 24th June 2026 brought, inter alia, under Section 888 of the Companies Act, 2015 seeking an order extending time within which a Charge dated 18th May 2026 and registered at the Nakuru District Lands Registry on 22nd May 2026 over Title Numbers Nakuru Municipality Block 21/802 and Nakuru Municipality Block 21/802 in favour of the Applicant may be registered at the Companies Registry. The charge secures a sum of Kshs. 16,500,000/=. 2.The application is supported by the affidavit of Nathaniel Wairioko Nduta. The grounds advanced are that although the charge was duly registered at the Lands Registry, it was not lodged at the Companies Registry within the statutory period prescribed under Section 885 of the Companies Act due to operational and procedural challenges encountered during the completion of registration formalities at the Lands Registry. The Applicant contends that the omission was inadvertent, was not deliberate, and that the Chargor has no objection to the application. 3.I have considered the application, the affidavit in support, and the annexed material. 4.Section 888 of the Companies Act empowers the Court, where it is satisfied that the failure to register a charge within the prescribed period was accidental, due to inadvertence or some other sufficient cause, and where no prejudice would be occasioned to creditors or members of the company, to extend time for registration on such terms as it considers just. 5.In National Bank of Kenya Ltd v Michael Ndungu [2018] eKLR, it was held that where a delay is explained, and no third-party interests are prejudiced, the Court should favor the perfection of substantive security interests over procedural technicalities. 6.The evidence before the Court shows that the charge was executed and registered at the Lands Registry within time but was not subsequently registered at the Companies Registry before the expiry of the statutory period on 17th June 2026. The explanation proffered is that there were operational and procedural challenges relating to the completion of registration formalities at the Lands Registry. There is no material before the Court suggesting bad faith, deliberate disregard of the law, or any intention to defeat the rights of creditors or third parties. 7.I am also persuaded that failure to grant the orders sought may expose both the chargee and the chargor to unnecessary prejudice, given that the security documentation requires complete registration in the relevant registries to achieve its intended legal effect. Further, it is stated that the Chargor does not oppose the application. 8.In the circumstances, I am satisfied that the delay has been sufficiently explained and that this is a proper case for the exercise of the Court's discretion under Section 888 of the Companies Act. 9.Accordingly, I make the following orders:i.The Notice of Motion dated 24th June 2026 is hereby allowed.ii.Time for registration at the Companies Registry of the Charge dated 18th May 2026 over Title Numbers Nakuru Municipality Block 21/802 and Nakuru Municipality Block 21/802 in favour of KCB Bank Kenya Limited is hereby extended.iii.The said Charge shall be lodged for registration at the Companies Registry within thirty (30) days from the date of this ruling or within such other period as the Registrar of Companies may accept pursuant to this order.iv.Upon presentation of this order, the Registrar of Companies shall register the Charge as if it had been lodged within the prescribed statutory period.v.There shall be no order as to costs, the application being ex parte. 10.It is so ordered. DATED, SIGNED, AND DELIVERED AT NAIROBI THIS 26TH DAY OF JUNE 2026HON. MR. JUSTICE MOSES ADOJUDGE OF THE HIGH COURT