[2021] KEHC 7344 (KLR)
The court held that the presence of prayer (f) in the plaint, which seeks the lifting of the 2nd Defendant's veil of incorporation and investigation of company affairs under Section 787 of the Companies Act, 2015, vests exclusive jurisdiction in the High Court. The Magistrate's Court lacks jurisdiction to entertain...
Source-derived case information.
- Citation
- [2021] KEHC 7344 (KLR)
- Parties
- Plaintiff: Malplast Industries Limited; Defendant: Abdi Kani Omar; Defendant: Ablun East Africa Limited
- Court
- High Court
- Court Station
- High Court at Nairobi (Milimani Commercial Courts)
- Jurisdiction
- Kenya
- Case Number
- Civil Case E511 of 2020
- Procedural Posture
- Civil Case / Ruling on Application to Transfer Case to Magistrate's Court
- Outcome
- Defendant's application to transfer the case to the Magistrate's Court struck out; no order as to costs.
- Legal Topics
- Jurisdiction of Courts, Lifting Corporate Veil, Company Investigations
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Malplast Industries Limited
Plaintiff
Abdi Kani Omar
Defendant
Ablun East Africa Limited
Defendant
Procedural Posture
Civil Case / Ruling on Application to Transfer Case to Magistrate's Court
Legal Issues
- 1 Whether the High Court or Magistrate's Court has jurisdiction to hear and determine the suit in light of prayer (f) in the plaint.
- 2 Whether the application to transfer the case to the Magistrate's Court is merited.
Ratio Decidendi
The court held that the presence of prayer (f) in the plaint, which seeks the lifting of the 2nd Defendant's veil of incorporation and investigation of company affairs under Section 787 of the Companies Act, 2015, vests exclusive jurisdiction in the High Court. The Magistrate's Court lacks jurisdiction to entertain such matters, regardless of any pecuniary claims. The application by the Defendant to transfer the case to the Magistrate's Court was therefore an abuse of process and intended to delay proceedings. The court exercised its inherent powers to strike out the application to ensure the expeditious resolution of the dispute.
Court Disposition
Defendant's application to transfer the case to the Magistrate's Court struck out; no order as to costs.
Orders
- The defendant's Notice of Motion dated 8/3/2021 is struck out.
- No orders as to costs.
Full Case Text
Judgment text and source record
19 paragraphs
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA
MILIMANI COMMERCIAL & ADMIRALITY DIVISION
CIVIL CASE NUMBER E511 OF 2020
MALPLAST INDUSTRIES LIMITED.............................................................PLAINTIFF
VERSUS
ABDI KANI OMAR................................................................................1ST DEFENDANT
ABLUN EAST AFRICA LIMITED......................................................2ND DEFENDANT
RULING
1. The overriding objective of the court is to do just and expeditious resolution of disputes. And therefore, applying the inherent powers of the court conferred on it under Section 3A of the Civil Procedure Act, the court is unlimited in removing anything on its way that prevents the expeditious disposal of a matter.
2. This is the situation obtaining in this case. The application by the Defendant dated 8/3/2021 seeking the transfer of the instant case to the Magistrate’s Court is one intended to waste the court’s precious time. As submitted by learned counsel, Mr. Mungai for the Plaintiff, only the High Court has powers to deal with matters under Section 787 of the Companies Act, 2015. That is, matters investigation of the company’s affairs. Prayer (f) in the plaint is hinged under this provision. It seeks the lifting of the 2nd Defendant’s veil of incorporation for purposes of executing the court’s judgment as against its officers personally in the event the 2nd Defendant fails to satisfy the same.
3. It follows that the Magistrate’s court has no jurisdiction to hear and determine the suit by virtue of prayer (f) in the plaint and notwithstanding other pecuniary prayers.
4. Accordingly, and for purposes of spanning the wheels of justice, the defendant’s Notice of Motion dated 8/3/2021 is hereby stuck out with no orders as to costs.
DATED AND DELIVERED AT NAIROBI THIS 19TH APRIL, 2021
G.W. NGENYE-MACHARIA
JUDGE
In the presence of:
1. Mr. Ongechi for the Defendant/Applicant
2. Mr. Mungai for the Plaintiff/Respondent