[2022] KEHC 11697 (KLR)

[2022] KEHC 11697 (KLR)

The court found that although the judgment in favor of the 8th respondent on the professional undertaking was final, the sum of Kshs. 102,378,022.98 had been ring-fenced by agreement between the applicant and the 1st to 6th respondents pending resolution of disputes under the SPA. The court held that it would be...

Source-derived case information.

Citation
[2022] KEHC 11697 (KLR)
Parties
Applicant: Samuel Thenya Maina; Respondent: Brian Martin Francis; Respondent: Estate of Hiram Ngaruiya; Respondent: Isaac Njoroge Gitoho; Respondent: James Njuguna Gitoho; Respondent: Krisco Holdings Limited; Respondent: Muiboro Enterprises Limited; Respondent: KCB Bank Kenya Limited; Respondent: Bilha W. Mwangi & Kemboy Julius Kipkosgey t/a Kemboy Law Advocates LLP; Respondent: Njeri Benson Ngugi; Respondent: Igeria Arthur Konye; Respondent: Njoroge David Ngumbu T/A Igeria & Ngugi Advocates
Court
High Court
Court Station
High Court at Nairobi (Milimani Law Courts)
Jurisdiction
Kenya
Judgment Date
19 May 2022
Case Number
Civil Suit E112 of 2021
Procedural Posture
Civil Suit / Ruling on Interlocutory Application for Injunction Pending Arbitration
Outcome
Application for injunction dismissed; orders granted for deposit of funds in joint account.
Judges
A Mabeya
Legal Topics
Arbitration Interim Measures, Professional Undertakings, Share Purchase Agreements, Ring Fencing of Funds
Source Language
english
Commercial and Corporate Civil Procedure Arbitration Interim Measures Professional Undertakings Share Purchase Agreements Ring Fencing of Funds

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Parties

Samuel Thenya Maina

Applicant

Brian Martin Francis

Respondent

Estate of Hiram Ngaruiya

Respondent

Isaac Njoroge Gitoho

Respondent

James Njuguna Gitoho

Respondent

Krisco Holdings Limited

Respondent

Muiboro Enterprises Limited

Respondent

KCB Bank Kenya Limited

Respondent

Bilha W. Mwangi & Kemboy Julius Kipkosgey t/a Kemboy Law Advocates LLP

Respondent

Njeri Benson Ngugi

Respondent

Igeria Arthur Konye

Respondent

Njoroge David Ngumbu T/A Igeria & Ngugi Advocates

Respondent

Procedural Posture

Civil Suit / Ruling on Interlocutory Application for Injunction Pending Arbitration

Legal Issues

  1. 1 Whether the court should grant an injunction restraining payment of Kshs. 102,378,022.98 to the 8th respondent pending arbitration.
  2. 2 Whether the sum of Kshs. 102,378,022.98 is subject to preservation under section 7 of the Arbitration Act.
  3. 3 Whether the interests of the applicant would be rendered nugatory if the funds are released before conclusion of arbitration.

Ratio Decidendi

The court found that although the judgment in favor of the 8th respondent on the professional undertaking was final, the sum of Kshs. 102,378,022.98 had been ring-fenced by agreement between the applicant and the 1st to 6th respondents pending resolution of disputes under the SPA. The court held that it would be inequitable to allow the release of the funds to the 1st to 6th respondents before conclusion of the arbitration, as their whereabouts and asset base were unknown and recovery would be difficult if the applicant succeeded. The court determined that the justice of the case required the funds to be held by the advocates for the disputants, thereby protecting the applicant's...

Court Disposition

Application for injunction dismissed; orders granted for deposit of funds in joint account.

Orders

  • Prayer no.3 of the Summons dated 26/2/2021 is dismissed.
  • Prayer nos. 4 and 5 of the Summons dated 26/2/2021 are granted.