https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/4452

**REPUBLIC OF KENYA** **IN THE ENVIRONMENT & LAND COURT AT NAIROBI** **E.L.C NO. E025 OF 2023** **[Consolidated with ELC NO E079 OF 2024]** **KENYA RAILWAYS CORPORATION - 1ST PLAINTIFF** **ETHICS & ANTI-CORRUPTION** **COMMISSION - 2ND PLAINTIFF** **VS** **RUBIS ENERGY KENYA PLC - 1ST DEFENDANT** **KENOL KOBIL PLC - 2ND DEFENDANT** **LIMA LTD - 3RD DEFENDANT** **LZ ENGINEERING CONSTRUCTION LTD - 4TH DEFENDANT** **JOHN MICHAEL OHAS - 5TH DEFENDANT** **JAMES RAYMOND NJENGA - 6TH DEFENDANT** **WILSON GACANJA - 7TH DEFENDANT** **KOBIL PETROLEUM LTD - 8TH DEFENDANT/APPLICANT** **KOBIL OIL KENYA LTD - 9TH DEFENDANT** **RULING** **[ with respect to the 8th Applicant/Defendant’s application dated 27/10/25]** 1. This Court has been moved by the Applicant pursuant to the provisions of Sections 1A, 1B, and 3A of the Civil Procedure Act, [CPA] Order 2 Rule 15(1)(d), Orders 5 Rules 21, 22, 25, and 29, as well as Order 51 Rule 1 of the Civil Procedure Rules, 2010, [CPR] along with all other applicable legal provisions. 2. In the instant application, the Applicant seeks orders that the suit against the 8th Defendant/Applicant be dismissed or struck out forthwith and that costs be awarded in its favour. 3. The application is based on the grounds annexed thereto and supported by the affidavit, duly sworn by Mr James K Muthui, an Advocate of the High Court of Kenya and a partner at the law firm of Kaplan & Stratton, on record for the 8th Defendant, who avows that he is competent to depose to the affidavit. 4. The Applicant asserts that, by the Plaintiff's own pleadings, it is a foreign-registered entity, incorporated and domiciled outside the jurisdiction of this Court, with no registered office or place of business within Kenya. Furthermore, the Applicant states that it was served with summons to enter an appearance and an amended plaint by post, without adhering to the mandatory procedure for service outside the Court's jurisdiction as set out in Order 5 Rules 21, 22, 25 & 29 of the Civil Procedure Rules. 5. Consequently, it is averred that the 8th defendant was not served or was not properly served, and that the Court's jurisdiction has not been properly invoked. The purported service is null and void and amounts to an abuse of the Court's process, and therefore, the Court lacks jurisdiction to entertain the suit against the 8th defendant. The Court was urged, in the interests of justice, to dismiss or strike out the suit against the 8th defendant. 6. The 2nd Plaintiff opposed the application by its Reply Affidavit dated 24/11/25, sworn by its Counsel, Ms Jackie Kibogy. She deposed that whereas the Applicant is incorporated in the State of Delaware in the United States of America, documents obtained by the 2nd Plaintiff through its investigations reveal that the Applicant established a place of business in Kenya in compliance with the provisions of Section 366 of the Laws of Kenya, Cap 486 [now repealed], and the Registrar of Companies duly issued a certificate of compliance in accordance with Section 367 of the Companies Act. 7. Furthermore, the applicant, through the law firm of Esmail & Esmail Advocates, submitted a return of alteration along with the supporting documents to the Registrar of Companies in accordance with Section 368 of the Companies Act [now repealed]. 8. Consequently, the applicant, being a foreign-registered company, acquired capacity pursuant to Section 367(2) of the Act upon compliance with Section 366 to hold land in Kenya as though it were a company incorporated under the aforementioned Act. 9. She added that the Applicant carried on business in Kenya, with an established place of business at a postal address, as evidenced by correspondence signed by its Managing Director, namely the letter dated 6/1/1996 addressed to the Commission of Lands. Equally, the Postmaster General, in a letter dated 10/6/25, confirmed the Applicant's last known address in Kenya as Post Office Box No 30322 Nairobi. It was further noted that the Applicant has not demonstrated that it notified the Registrar of Companies of its cessation of business or that it ceased to have a place of business in Kenya in accordance with Section 373(1) of the Companies Act. 10. It was averred that service of summons on the Applicant was effected pursuant to Section 1010(2)(b) of the Companies Act currently in force, which is akin to Section 372 of the Companies Act [now repealed]. The old provisions have been restated in Part XXXVII of the Companies Act, in Sections 1010, 1011, and 1012. In conclusion, the 2nd Plaintiff stated that the Applicant's assertion that it has no registered office or place of business in Kenya is not accurate. **The written submissions** 1. The Applicant submitted that Order 5 Rules 21, 22, 25, and 29 of the Civil Procedure Rules (CPR) provide that any individual seeking to effect service outside Kenya must, among other requirements, apply to the Court for leave to do so. It was further submitted that this requirement is mandatory and that the Applicant failed to comply with the Civil Procedure Rules when effecting service in the instant suit. 2. In response to the 2nd Plaintiff's assertion that it maintains a registered office and place of business within Kenya, the Applicant contends that this assertion is factually and legally incorrect for the following reasons: The issue of service outside Kenya is separate from the question of whether the defendant has a local presence. The former requires the Applicant to first obtain leave from the Court. Pursuant to Order 5, rule 25, as amended by Legal Notice No. 22 of 2020, an Applicant seeking leave must demonstrate, among other criteria, that the plaintiff has a valid cause of action against the defendant, the location or probable location of the defendant, and whether the defendant is a resident within Kenya. The implication of this rule is that, regardless of the defendant's residency status, the plaintiff must secure prior leave; such leave is not granted automatically. Evidence must be presented to the Court establishing that the case is appropriate for service outside the jurisdiction [see Rebecca Mwikali Vs Guy Andre De Vos & 3 others [2022] EKLR]. The purpose of obtaining leave is to enable the Court to evaluate the reasons advanced by the petitioner and to determine whether a sufficient case has been made to justify service of summons beyond the jurisdiction [see DNK Vs GS [2022] KEHC]. The matter of leave is not merely procedural but constitutes a jurisdictional requirement, as clarified by the Court in Misnak International UK Limited Vs 4MB Mining Limited c/o Ministry of Mining, Juba, Republic of South Africa, & 3 others [2019 EKLR], where it was held that, in the absence of leave in accordance with the Civil Procedure Rules, the Court lacks jurisdiction to hear the case. Once leave has been granted, the party seeking to effect service must strictly comply with the prescribed legal procedures, as established in Raytheon Aircraft Credit Corporation v Air Al-Faraj Ltd [2005] eKLR. 3. That the postal address provided by the Post Master General shows that the address belongs to the 1st Defendant, not the applicant, further confirming that the position held by the 2nd Plaintiff, that the applicant has a registered office and/or a place of business in Kenya, is untrue. 4. In conclusion, the application submitted that, without leave of the Court and proper service, the Court's jurisdiction has been improperly invoked, and the Court was urged to dismiss or strike out the suit against the applicant, which, for all intents and purposes, is defective in the eyes of the law. 5. The 2nd Plaintiff, in its submissions dated 10/3/25, submitted that the Applicant submitted to the Court's jurisdiction by establishing a place of business in the country. Where a foreign company carries on business in Kenya, service may be effected upon the company through its local place of business or authorised representatives; accordingly, the 2nd Plaintiff was not required to invoke the provisions of the Civil Procedure Rules governing service outside the jurisdiction. Having established and maintained a place of business in Kenya, the Applicant fell outside the statutory framework governing service of foreign companies operating locally. 6. The 2nd Plaintiff has demonstrated, through documentation, that the Applicant has complied with the provisions of Section 366 of the Act, submitted relevant documents to the Registrar of Companies, and that, upon such compliance, the Registrar issued a certificate of compliance pursuant to Section 367. A return of alterations filed with the Registrar, as required by Section 368, shows that the Applicant maintains an active, operational, and regulatory presence within Kenya and complies with the statutory requirements applicable to foreign companies operating locally. Furthermore, correspondence and the registration of transfer of the suit land clearly indicate that the Applicant was operating within the jurisdiction and exercising the rights conferred upon locally incorporated companies, in accordance with Section 367(2) of the repealed Companies Act. Additionally, the Applicant has not provided any evidence that it filed a notice of cessation under Section 373 of the Act. In the absence of such notice, it is acknowledged that the Applicant continues to maintain its place of business within Kenya. The provisions of the repealed Act have been incorporated into the current Act; therefore, the Applicant's obligations under both Acts remain unchanged and are subject to service within Kenya. 7. In conclusion, the 2nd Plaintiff argues that the Applicant was duly served under the provisions of the law governing foreign companies carrying on business in Kenya, and that the application is untenable in law and fact and ought to be dismissed. **Analysis and determination** 1. The key issue for determination is whether the application is merited. 2. The gravamen of the Applicant’s case is that, as a foreign entity incorporated in Delaware, United States of America [USA], it was served by post locally without the Plaintiff first seeking and obtaining leave of the Court to serve outside the jurisdiction of Kenya, contrary to Order 5 Rules 21, 22, 25 and 29 of the Civil Procedure Rules [CPR], 2010. 3. The central issue for determination, therefore, is whether the 8th Defendant was properly served. This hinges on whether the Applicant is a "foreign entity" that requires leave for service under the Civil Procedure Rules, or a "registered foreign company" with a local presence, subject to service under the Companies Act, 2015. 4. The Court of Appeal in Misnak International (UK) Limited v 4MB Mining Limited C/O Ministry of Mining, Juba Republic of South Sudan & 3 others [2019] eKLR emphasised the importance of giving notice to a party that has been sued in Court. The Court stated as follows; “It is trite that one of the tenants of the rules of natural justice is that a party should not be condemned unheard. In other words, no proceedings should be conducted to the detriment of any person in his absence. It is in line with actualisation of this right that the provisions for summons to enter appearance and service thereof come into play. The essence of such summons is to give notice to the party sued of the existence of the suit and invite him/her to enter appearance and defend the suit if she/he so wishes. This requirement has been reinforced in a number of decisions of this Court, namely, Giro Commercial Bank Ltd vs Ali Swaleh Mwangula [2016] eKLR **&**Babs Security Services Ltd vs Mwarua Yawa Nzao & 19 Others [2019] eKLR. Additionally, the summons to enter appearance plays a pivotal role when a defendant is outside the Court’s jurisdiction. The supplemental but equally important role is that it empowers the Court in question to assume jurisdiction over such a party. See Order 5 Rules 21 & 22 of the Civil Procedure Rules and this Court’s decision in W K, M W K (Both suing as the Administrators of the Estate of Dr. W K) & Another vs British Airways Travel Insurance & Another [2017] eKLR**.”** 1. The service of summons against a foreign corporation in Kenya follows a two-track framework; the first is found in Order 5 Rule 21, and the other is found in the Companies Act [Section 366 of the repealed Act and Section 1010 of the current Act]. 2. Service out of Kenya of a summons or notice of a summons may be allowed by the Court whenever—(a)the whole subject-matter of the suit is immovable property situate in Kenya (with or without rents and profits);(b)any act, deed, will, contract, obligation or liability affecting immovable property situate in Kenya is sought to be construed, rectified, set aside, or enforced in the suit;(c)any relief is sought against any person domiciled or ordinarily resident in Kenya;(d)the suit is for the administration of the personal estate of a deceased person who at the time of his death was domiciled in Kenya, or for the execution (as to property situate in Kenya) of the trusts of any written instrument, of which the person to be served is a trustee, which ought to be executed according to the law of Kenya;(e)the suit is one brought to enforce, rectify, rescind, dissolve, annul, or other-wise affect a contract or to recover damages or other relief for or in respect of the breach of a contract—(i)made in Kenya; or(ii)made by or through an agent trading or residing in Kenya on behalf of a principal trading or residing out of Kenya; or(iii)by its terms or by its legislation to be governed by the Laws of Kenya; or(iv)which contains a provision to the effect that any Kenya Court has jurisdiction to hear and determine that suit in respect of that contract,or is brought in respect of a breach committed in Kenya, of a contract, wherever made, even though such a breach was preceded or accompanied by a breach out of Kenya which rendered impossible the performance of the part of the contract which ought to have been performed in Kenya; or(f)the suit is founded on a tort committed in Kenya;(g)any injunction is sought as to anything to be done in Kenya, or any nuisance in Kenya is sought to be prevented or removed, whether damages are or are not also sought in respect thereof; or(h)any person out of Kenya is a necessary or proper party to a suit properly brought against some other person duly served in Kenya. 3. Under Order 5 Rule 25 service of summons upon a defendant out of Kenya is provided for as follows; “Every application for leave to serve such summons or notice on a defendant out of Kenya shall be supported by affidavit or other evidence, stating that in the belief of the deponent the plaintiff has a good cause of action, and showing in what place or country such defendant is or probably may be found, and whether such defendant is not resident in Kenya or not, and the grounds on which the application is made; and no such leave shall be granted unless it is made sufficiently to appear to the Court that the case is a proper one for service out of Kenya under this Order” 1. It must be noted that while the provisions of Order 5 Rule 25 of the Civil Procedure Rules are concerned not with the defendant's foreign incorporation but with the fact that service is to be effected outside Kenya, such service is provided for under Order 5 Rule 29 of the Civil Procedure Rules. 2. Prior to authorising service outside Kenya, the Court must ascertain that the plaintiff has established a prima facie cause of action and that the claim falls within one of the recognised categories permitting service beyond the jurisdiction. Accordingly, when service is to be effected abroad, the Court acquires jurisdiction over the foreign defendant only after leave has been sought and service has been effected in accordance with the Court's directions. This position was succinctly articulated in Ojwang v Black Market Records LLC & another (Commercial Case E435 of 2025) [2026] KEHC 3956 (KLR), where the Court stated: “The purpose of seeking leave is to allow the Court to evaluate whether the Plaintiff has a prima facie case and whether the claim falls within the specific circumstances outlined in Order 5 Rule 25 that justify service outside Kenya. Jurisdiction is only assumed after leave is granted and after the summons or notice of summons is properly served on the foreign defendant.” 1. The position changes notably when the defendant is a foreign entity registered under Part XXXVII of the Companies Act. Section 974 of the Companies Act states: "A foreign company shall not carry on business in Kenya unless: 1. it is registered under this Part; or 2. it has applied to be so registered, and the application has not been dealt with within the prescribed period." 3. Registration under Part XXXVII of the Companies Act, 2015, creates a recognised legal presence in Kenya by requiring a foreign company to maintain a registered office and appoint local representatives for contact and service. This ensures that a foreign company doing business in Kenya and meeting registration requirements remains accessible to litigants within the jurisdiction. 4. Therefore, registration under Part XXXVII offers a legal basis for a Kenyan Court to acknowledge a foreign company’s presence in Kenya, enabling service of process and jurisdiction. Section 1010 outlines a comprehensive statutory process for service. "A document may be served on a registered foreign company: 1. by leaving it with, or sending it by post to, the local representative of the company in Kenya (or the designated local representative where there is more than one local representative); or 2. where the company has no local representative, or where the local representative refuses service or service cannot for any other reason be effected, by leaving it at, or sending it by post to, any place of business of the company in Kenya." 3. Therefore, a Plaintiff can lawfully serve summons on a registered foreign company by the methods set out in Section 1010(2). When service is made on the company's local representative or at its local place of business in Kenya, it is deemed proper service. In such cases, Order 5 Rule 25 does not apply, as there is no requirement to transmit the summons beyond the court's jurisdiction. 4. The Applicant relies on the principle that service outside the jurisdiction is a "nullity ab initio" unless leave of the Court is first obtained. This Court acknowledges the holding in Misnak International UK Limited v 4MB Mining Limited & Others [2019] eKLR, which establishes that leave is a jurisdictional prerequisite for service outside Kenya. However, the 2nd Respondent (Plaintiff) has produced compelling documentary evidence—including a Certificate of Compliance under the former Section 367 of the Companies Act [Cap 486]—demonstrating that the Applicant established a place of business in Kenya. Under Kenyan law, a foreign company that has registered a branch locally and obtained a Certificate of Compliance submits itself to the jurisdiction of the Kenyan Courts and to the specific service mechanisms provided by the Companies Act. 5. The repeal of the Companies Act (Cap 486) and the transition to the Companies Act, 2015 did not extinguish the Applicant’s status. Under the transitional provisions, a foreign company registered under the old Act remains registered under the new Act. Section 1010(2) of the Companies Act, 2015 provides: “A document may be served on a registered foreign company – (a) by leaving it at, or sending it by post to, the registered office of the company in Kenya, or (b) by leaving it at, or sending it by post to, the address of a local representative of the company….” 1. Unchallenged evidence shows that the 8th Defendant delivered documents and particulars to the Registrar under Section 366 of the repealed Companies Act and was issued a certificate of compliance under Section 367. The return of alteration filed under Section 368 expressly described the company as a Delaware-registered company that had established a place of business in Kenya. The title documents show that Grant I.R. No. 69482 in respect of L.R. No. 209/12133 was issued to Kobil Petroleum Limited for a term of 99 years from 1/5/96. The grant described the company as having a registered office in Nairobi. The documents presented make it clear that, at one time, the law firm of Esmail and Esmail informed the Registrar of Companies that the 8th Defendant is a company with a place of business in Kenya. Under Section 366(d) of the repealed Act, the company appointed the then Managing Director of Kenol Kobil to be its local agent for accepting service in Kenya. Subsequent documentary records disclose applications for development permission, planning approvals, environmental licences, business permits, regulatory correspondence, and dealings relating to the petrol station and the suit properties. The earlier documents were issued or addressed to Kobil Petroleum Limited, while later documents refer to Kenol Petroleum Limited, Kenol Kobil Plc, and Rubis Energy Kenya Plc. The address used to serve the Applicant was confirmed by the Post Master General as belonging to Rubis Energy Kenya Plc, the 8th Defendant's parent company. 2. Once a foreign company is registered locally, it is no longer "outside the jurisdiction" for the purposes of service of process, as an unregistered foreign entity would be. Consequently, the mandatory requirement for leave under Order 5 of the Civil Procedure Rules [CPR] is bypassed by the specific statutory provisions of the Companies Act. 3. The 2nd Plaintiff provided evidence of the Applicant's historical registration, correspondence with the Commissioner of Lands, and its status as a subsidiary of the 1st Defendant. In judicial proceedings, once a fact is established (the local registration), the burden of proof shifts to the party asserting a change in that status. 4. Under Section 373 of the repealed Act (now Section 981 of the 2015 Act), a foreign company that ceases to have a place of business in Kenya must notify the Registrar. As held in Kenya Power & Lighting Co. Ltd v Mike Laly [2014] eKLR, a party cannot merely deny a fact evidenced by official records without providing a "Notice of Cessation" or a current official search showing that the branch was struck off the register. The Applicant’s failure to produce such evidence is fatal to its application. 5. From the foregoing, the court therefore finds that the Applicant is a registered foreign company within the meaning of the Companies Act, having established a local place of business. Service was effected via the postal address of the Applicant’s parent company [the 1st Defendant herein]. In the absence of a Notice of Cessation, the 2nd Respondent was entitled to rely on the existing registration records. By registering locally and holding land under a 99-year grant, the Applicant submitted to the jurisdiction of this Court. The requirement for leave under Order 5 of the Civil Procedure Rules does not apply where a foreign company has a registered local presence under the Companies Act. This Court finds that the 8th Defendant/Applicant has failed to displace the evidence of its local registration and presence. 6. In conclusion, the Court further finds that, as regards the 8th Defendant, its historical certificate of compliance, declared place of business, registered office, land ownership, and commercial operations establish a substantial Kenyan nexus. Accordingly, service at its parent company’s address complied with the provisions of the law and did not require leave of the Court. 7. Accordingly, I make the following orders: 8. The Applicant’s application is unmerited and it is hereby dismissed. 9. Costs of this application are awarded to the 2nd Plaintiff. 40. Orders accordingly **DELIVERED, DATED AND SIGNED AT NAIROBI THIS 6TH DAY OF JULY 2026 VIA MICROSOFT TEAMS** **J G KEMEI** **JUDGE** **Delivered Virtually in the Presence of**: 1. Ms Asasha H/B for Bake for the Plaintiff 2. Ms. Kibogy for the Plaintiff 3. Ms Nyangweso H/B for Mr. Muthui for 1st & 2nd Defendants 4. Mr. Otieno for 3rd Defendant 5. N/A for 4th & 5th Defendants 6. Mr. Kamaara for 6th Defendant 7. Ms. Wahome H/B for Mr. Kiprop for 7th Defendant 8. Ms. Nyangweso H/B of Muthui for 8th & 9th Defendants 9. CA – Ms Kendi