[2025] KEHC 10506 (KLR)
The court found that while the applicant's claim of financial difficulty due to the COVID-19 pandemic was plausible, the applicant had failed to communicate or cooperate with the respondent regarding settlement of the decrees. This lack of engagement created a perception of bad faith and justified the respondent's...
Source-derived case information.
- Citation
- [2025] KEHC 10506 (KLR)
- Parties
- Applicant: Molyn Credit Limited; Respondent: Odeny Maube & Co. Advocates
- Court
- High Court
- Court Station
- High Court at Busia
- Jurisdiction
- Kenya
- Case Number
- Miscellaneous Civil Application E024 of 2022
- Procedural Posture
- Miscellaneous Application / Ruling on Motion to Lift Corporate Veil and Summon Directors for Examination
- Outcome
- Motion allowed in terms of prayer 1; directors to attend court for examination; further orders deferred.
- Judges
- WM Musyoka
- Legal Topics
- Execution of Decree, Lifting Corporate Veil, Examination of Judgment Debtor
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Molyn Credit Limited
Applicant
Odeny Maube & Co. Advocates
Respondent
Procedural Posture
Miscellaneous Application / Ruling on Motion to Lift Corporate Veil and Summon Directors for Examination
Legal Issues
- 1 Whether the court should lift the corporate veil of the applicant to hold its directors personally liable for the decretal debt.
- 2 Whether the directors of the applicant should be summoned to court for examination on oath and production of financial documents.
- 3 Whether the applicant's financial difficulties justify delay in execution of the decree.
Ratio Decidendi
The court found that while the applicant's claim of financial difficulty due to the COVID-19 pandemic was plausible, the applicant had failed to communicate or cooperate with the respondent regarding settlement of the decrees. This lack of engagement created a perception of bad faith and justified the respondent's request for the directors to be summoned for examination. The court held that it was within the respondent's rights to seek cross-examination of the directors to establish the applicant's means and determine the appropriate mode of execution. Accordingly, the court allowed the motion to the extent of summoning the directors for examination and production of relevant documents,...
Court Disposition
Motion allowed in terms of prayer 1; directors to attend court for examination; further orders deferred.
Orders
- The directors of Molyn Credit Limited shall attend court on 29th July 2025 for examination on oath and production of documents as per prayer 1 of the motion dated 21st February 2025.
- Prayers 2 and 3 of the motion to be considered after the directors' examination.
Full Case Text
Judgment text and source record
22 paragraphs
Molyn Credit Limited v Odeny Maube & Co. Advocates (Miscellaneous Civil Application E024, E025 & E026 of 2022 (Consolidated)) [2025] KEHC 10506 (KLR) (18 July 2025) (Ruling)
Neutral citation: [2025] KEHC 10506 (KLR)
Republic of Kenya
In the High Court at Busia
Miscellaneous Civil Application E024, E025 & E026 of 2022 (Consolidated)
WM Musyoka, J
July 18, 2025
Between
Molyn Credit Limited
Applicant
and
Odeny Maube & Co. Advocates
Respondent
Ruling
1. The application, dated 21st February 2025, seeks lifting of the veil of incorporation of the principal applicant, Molyn Credit Limited, to facilitate its directors being held personally liable to settle the debts of the principal applicant, the subject of these proceedings, and for the attendance in court of the said directors, for examination on oath, and production of documents and records of accounts.
2. The background is that the principal applicant has failed to settle the decree herein of the costs taxed in favour of the principal respondent. It is explained that efforts to attach the movable assets of the principal applicant were unsuccessful, as the said assets were unknown. That has meant that the directors of the principal applicant should attend court, to be examined, for the purpose of establishing the means and assets of the principal applicant, to facilitate establishment of the most efficient mode of execution. In the event, the directors fail to attend court, they ought to be held personally liable.
3. There is a response to the application, vide the affidavit of Moses N. Anyangu, a director of the principal applicant. He acknowledges the decrees, and explains that there was no effort to defeat their execution. He explains that the principal applicant has been facing financial challenges arising from the disruption caused by the COVID19 pandemic, from which the principal applicant is yet to recover. He argues that the application is premature and pleads for time to allow the principal applicant to recover its monies, from borrowers, to boost its financial stability, which would facilitate settlement of the decretal amount. He has attached a statement of accounts.
4. Directions were given, on 12th May 2025, for canvassing of the application by way of written submissions. I have read and considered the written submissions, on record, from both sides, and taken note of the arguments made.
5. The principal applicant, I note, does not appear to have shared the matter of the financial challenges that it says it has been facing, with the principal respondent, and come up with a programme on how it proposes to settle the decrees. Whereas I concede that there could be credence in its argument about financial difficulty, I am not persuaded that it has cooperated with the principal respondent, towards finding a final solution, hence creating the perception that it was up to no good.
6. In view of that, it would be within the rights of the principal respondent to have the directors cross-examined, to provide a basis, if at all, for the decisions that should follow on whether they should be held liable for the debt personally, or whether the principal applicant should be given time to resolve the matter.
7. In view of that, I shall, therefore, allow the Motion, dated 21st February 2025, in terms of prayer 1. Prayers 2 and 3 shall be considered after the disposal of prayer 1. The directors shall attend court on 29th July 2025, for the purpose of being examined on oath, and for production of the materials, the subject of prayer 1 of the said Motion. Orders accordingly.
DELIVERED, DATED AND SIGNED, IN OPEN COURT, AT BUSIA, ON THIS 18TH DAY OF JULY 2025. WM MUSYOKAJUDGEMr. Arthur Etyang, Court Assistant.AdvocatesMr. Achero, instructed by Achero Mufuayia & Company, Advocates for the principal applicant.Mr. Odeny, instructed by Bruce Odeny & Company, Advocates for the principal respondent.