Bhanji v Minaret Developments Limited & 2 others (Commercial Case E116 of 2024) [2026] KEHC 7466 (KLR) (Commercial and Tax) (28 May 2026) (Judgment)

Bhanji v Minaret Developments Limited & 2 others (Commercial Case E116 of 2024) [2026] KEHC 7466 (KLR) (Commercial and Tax) (28 May 2026) (Judgment) Neutral citation: [2026] KEHC 7466 (KLR) Republic of Kenya In the High Court at Nairobi (Milimani Commercial Courts) Commercial and Tax Commercial Case E116 of 2024 MA Otieno, J May 28, 2026 Between Moyez Sadrudin Bhanji Plaintiff and Minaret Developments Limited 1st Defendant Daniel Kairu Kiaraho 2nd Defendant Greenwoods Limited 3rd Defendant Judgment 1.The Plaintiff, Moyez Sadrudin Bhanji,instituted this suit by way of a Plaint dated 6th March 2024 against the Defendants, challenging his removal as a director of the 3rd Defendant. 2.He averred that the 3rd Defendant was incorporated on 4/4/2005 and that, following the Judgment delivered on 22/11/2016 and the Ruling delivered on 23/9/2021 in Milimani HCCC No. 539 of 2008, the shareholding of the company stood as follows: the 1st Defendant holding 500 shares, the Plaintiff holding 499 shares, and the 2nd Defendant jointly with the deceased Samuel Mirie Gachathi holding 1 share. 3.The Plaintiff stated that the 3rd Defendant is the registered proprietor of L.R. No. 1/152 (Original No. 1/12/3), upon which a house stands. He averred that he played a pivotal role in the acquisition of the property and had solely managed it on behalf of the company by ensuring payment of rates, rent, staff salaries and maintenance expenses. He contended that the 1st Defendant was aware of, and had previously jointly catered for, the expenses related to the property. 4.The Plaintiff averred that, upon the 2nd Defendant joining the company, there emerged a scheme to remove him both as a director and shareholder. He stated that, vide a letter dated 10/2/2023, the 2nd Defendant issued a notice of intention to move a motion for his removal as director. Consequently, the company secretary issued a notice dated 22/2/2023 convening a virtual meeting for 16/3/2023. The Plaintiff stated that, although he attended the meeting together with the Defendants and the company secretary, no discussion or reasons were advanced to justify his removal and he was not accorded an opportunity to present his case. He averred that the resolution was nevertheless passed by the 1st and 2nd Defendants, who collectively held 501 shares, thereby removing him as director. 5.The Plaintiff contended that the removal was illegal, unprocedural and contrary to Section 141(2) of the Companies Act, 2015, Article 20 of the company’s Articles of Association and the principles of natural justice. He further averred that the removal prejudiced the day-to-day operations of the company since he had solely managed its affairs and that the Defendants were now pursuing a second scheme to remove him as a shareholder through a notice dated 6/2/2024 proposing amendment of the shareholding structure. 6.The Plaintiff therefore sought declarations that the parties were the sole shareholders of the 3rd Defendant and that the resolution passed on 16/3/2023 removing him as director was void and unprocedural. He further sought mandatory and permanent injunctions reinstating him as director, restraining implementation of the impugned resolution and restraining any amendment of his shareholding, together with costs and interest. Plaintiff’s Witness Statement 7.The Plaintiff filed a witness statement dated 6/3/2024. He stated that he is a shareholder holding 499 shares in the 3rd Defendant company and that, together with the 1st and 2nd Defendants, they are the sole shareholders of the 3rd Defendant. He stated that the 3rd Defendant was incorporated on 4/4/2005 with himself, Abdul Mohamed and the 1st Defendant as shareholders and directors. He further stated that, on 15/12/2009, Abdul Mohamed transferred his shares to him and he subsequently shared the transferred shares equally with the 1st Defendant, resulting in each holding 500 shares. 8.The Plaintiff stated that, pursuant to the Judgment delivered on 22/11/2016 and the Ruling delivered on 23/9/2021 in Milimani HCCC No. 539 of 2008, the 2nd Defendant jointly with the deceased Samuel Mirie Gachathi were awarded one share from his shareholding, thereby altering the shareholding structure to: the 1st Defendant holding 500 shares, himself holding 499 shares, and the 2nd Defendant jointly with the deceased holding 1 share. 9.He stated that the 3rd Defendant is the registered owner of L.R. No. 1/152 (Original No. 1/12/3), upon which stands an unoccupied house, and that he played a pivotal role in the acquisition of the property for the benefit of the company. He averred that he solely managed the property by ensuring repairs, payment of land rent and rates, payment of staff salaries and general maintenance to preserve its value. He further stated that the 1st Defendant was aware of, and had jointly contributed to, the maintenance expenses until recently. 10.The Plaintiff averred that, upon the 2nd Defendant joining the company, there emerged a clear intention to remove him both as director and shareholder. He stated that, vide a letter dated 10/2/2023, the 2nd Defendant issued notice of intention to move a motion for his removal as director and, consequently, the company secretary issued a notice dated 22/2/2023 convening a virtual meeting for 16/3/2023. He stated that the agenda of the meeting was predominantly to deliberate on his removal as director. 11.The Plaintiff stated that, although he attended the meeting together with the Defendants and the company secretary, no discussion or reasons were advanced to justify his removal and he was not accorded an opportunity to present his case. He averred that the matter was simply put to a vote and the Defendants, who collectively held 501 shares, voted in favour of the resolution while he voted against it. Consequently, the resolution was passed and he was removed as director of the 3rd Defendant. 12.The Plaintiff contended that the Defendants’ actions were ill-intended, prejudicial to the operations of the company and aimed at removing him completely from the company. He averred that his removal had adversely affected the day-to-day running of the 3rd Defendant since he had solely managed its affairs. He further stated that, despite his objections, the meeting was closed and the Defendants subsequently convened another meeting scheduled for 11/3/2024 with the intention of removing him as shareholder. He maintained that the intended actions were illegal and prayed that the suit be allowed as prayed. Defendants’ Case 13.The 1st to 3rd Defendants filed a Joint Statement of Defence and Counterclaim dated 28/3/2024. They denied that the Plaintiff validly held 499 shares in the 3rd Defendant. They averred that, upon incorporation of the 3rd Defendant on 4/4/2005, the shareholding comprised Abdul Mehdi Mohamed, Farid Mehdi Mohamed and Moyez Bhanji, each holding one ordinary share. They further stated that Farid Mehdi Mohamed held his share on behalf of the 1st Defendant and that the same was transferred on 15/5/2009. 14.The Defendants averred that, by a Sale of Shares Agreement dated 16/4/2008, the Plaintiff sold his only one ordinary share to the 2nd Defendant jointly with the deceased Samuel Mirie Gachathi for Kshs. 23,570,000/= and consequently ceased being both a shareholder and director of the 3rd Defendant pursuant to Article 13 of the Articles of Association. They stated that the Judgment delivered on 22/11/2016 merely confirmed the validity of the sale agreement and ordered specific performance through transfer of the share. 15.The Defendants further averred that, despite having sold his only share, the Plaintiff fraudulently chaired a meeting on 15/12/2009 where he allocated himself 428 shares, allotted Abdul Mehdi Mohamed 70 shares and Farid Mehdi Mohamed 71 shares, which shares were subsequently partly acquired by the 1st Defendant for Kshs. 10 million. They contended that the allotment and dilution of shares were undertaken in bad faith without notice to the 2nd Defendant, who had already purchased one of the original shares. They further averred that the Plaintiff, having ceased being a shareholder and director, lacked authority to chair or participate in the meeting and that the entire process was illegal, fraudulent and unprocedural. 16.The Defendants admitted that the Plaintiff was removed as director during the meeting held on 16/3/2023, but maintained that discussions were held and that the removal was lawful and in consonance with Article 13 of the Articles of Association. They denied breaching Section 141(2) of the Companies Act, 2015, and contended that the Plaintiff had not provided any written response opposing the motion for his removal despite attending the AGM. They further stated that the subsequent meeting convened on 11/3/2024 was intended to rectify the illegal and fraudulent share allocation undertaken on 15/12/2009. 17.In their Counterclaim, the Defendants (Plaintiffs in the Counterclaim) therein averred that the Plaintiff’s sale of his only share on 16/4/2008 had the effect of terminating his status as shareholder and director while vesting the 2nd Defendant with all attendant rights and privileges attached to the share, including entitlement to one-third ownership of the company assets. They contended that the Plaintiff’s continued participation in company affairs thereafter, including the meeting of 15/12/2009, was unlawful. 18.The Defendants further averred in the Counterclaim that the resolutions passed on 15/12/2009 diluted the 2nd Defendant’s entitlement without notice, participation, or consent and were inconsistent with the Judgment delivered on 22/11/2016. They contended that the 2nd Defendant was entitled to one-third of the company shareholding, translating to 333 shares out of 1000 shares after dilution. They relied on findings in the Judgment of 22/11/2016 describing the Plaintiff as dishonest and acting to benefit from his own breach. 19.The Defendants further averred that the 3rd Defendant convened a meeting on 11/3/2024 and passed resolutions nullifying the resolutions of 15/12/2009 and redistributing the shareholding as follows: 167 shares to the Defendant, 333 shares to the 2nd Defendant, and 500 shares to the 1st Defendant. They maintained that the said allocation reflected the correct shareholding ratios. 20.The Plaintiffs in the Counterclaim (Defendants) also averred that the Plaintiff had refused to hand over company documents, including the title deed for L.R. No. 1/152 (Original No. 1/12/3), the company seal, accounting records, bank statements, and correspondence, despite no longer being a director. They therefore sought declarations that the Plaintiff ceased being a shareholder and director upon sale of his share on 16/4/2008, that the resolutions passed on 15/12/2009 were illegal and void, that the resolutions of 11/3/2024 reflected the correct shareholding, orders compelling surrender of company documents and enforcement of the court’s orders by the Registrar of Companies together with costs and interest. Defendants’ Witness Statement 21.The 2nd Defendant adopted his witness statement dated 28/3/2024 and stated that he is a shareholder and director of the 3rd Defendant company. He stated that the 3rd Defendant was incorporated on 4/5/2005 with Abdul Mehdi Mohamed, Farid Mehdi Mohamed and Moyez Bhanji each holding one ordinary share, each representing 33.33% of the company shareholding. He further stated that Farid Mehdi Mohamed held one share on behalf of the 1st Defendant and that the same was transferred on 15/5/2009. 22.The 2nd Defendant referred to Article 13 of the 3rd Defendant’s Articles of Association, which provided that directors must be shareholders. He averred that, by virtue of the said provision, once a person ceased being a shareholder, he automatically ceased being a director unless subsequently reappointed after lawfully acquiring shares. He therefore stated that the original shareholders automatically became directors by virtue of their shareholding. 23.The 2nd Defendant stated that the 3rd Defendant owns L.R. No. 1/152 (Original Number 1/12/3) situated in Nairobi together with the building erected thereon. He further stated that, vide a Sale of Shares Agreement dated 16/4/2008, the Plaintiff sold his only ordinary share together with all attached rights and privileges to him and the late Samuel Mirii Gachathi for Kshs. 23,570,000/=. He averred that, immediately upon execution of the agreement, the Plaintiff ceased being a shareholder and consequently ceased being a director pursuant to Article 13 of the Articles of Association. 24.The 2nd Defendant further relied on Clause 1 of the Sale Agreement, which provided that the purchasers would acquire the share together with all rights and privileges attached thereto, and Clause 6, which required the Plaintiff to resign as director upon completion of the transaction. He averred that, upon purchasing the share, he and the late Samuel Mirii Gachathi became entitled to shareholder privileges, including notices of shareholder and directors’ meetings, while the Plaintiff lost the right to convene, chair, or participate in company meetings. 25.The 2nd Defendant stated that, after the Plaintiff failed to transfer the share, he and the late Samuel Mirii Gachathi instituted HCCC No. 539 of 2008 seeking specific performance. He averred that the court, in its Judgment delivered on 22/11/2016, described the Plaintiff as dishonest and ultimately ordered specific performance compelling the transfer of the one share held by the Plaintiff as at the date of the agreement. He stated that, at the time of the agreement, the Plaintiff only held one share representing one-third of the company. 26.The 2nd Defendant further averred that, despite having ceased being a shareholder and director, the Plaintiff attended, chaired, and participated in a meeting held on 15th December 2009, where further shares were allotted, including 428 shares to himself (Moyez) and 428 shares to Minaret Developments Limited. Abdul Mohamed and Farid Mohamed were in that meeting, allotted 70 and 71 shares, respectively. 27.He stated that the said meeting was illegal and unprocedural because the Plaintiff lacked authority to participate, no notice was served upon him, and the late Samuel Mirii Gachathi, despite their entitlement thereto, and the allotment diluted their one-third shareholding without their participation or consent. He further averred that the allotment conflicted with the Judgment delivered on 22nd November 2016 and that he remained entitled to one-third of the company shareholding, translating to 333 shares out of the 1000 shares. 28.The 2nd Defendant stated that, on 16th February 2023, a document titled “Greenwoods – the way forward (September 2022) in the matter of: Daniel Kiaraho & Samuel Gachatha v/s Moyes Bhanji” was circulated by Iqbal Dhanji, raising concerns regarding irregularities arising from the meeting of 15th December 2009 and proposing resolutions including his appointment as director, removal of the Plaintiff as director, and ratification or nullification of the impugned resolutions. He averred that the company secretary (Optimum Registrars) thereafter issued a Notice of AGM dated 22nd February 2023, and, during the AGM held virtually on 16th March 2023, it was resolved that the Plaintiff cease being a director while he was appointed director of the company. 29.The 2nd Defendant further stated that, vide a notice dated 6th February 2024, the company secretary convened another meeting for 11th March 2024 to rectify the shareholding structure. He averred that, during the meeting, resolutions were passed nullifying the resolutions of 15th December 2009 and redistributing the shares as follows: 167 shares to the Plaintiff (Moyez Banji), 333 shares to himself (Daniel Kiaraho), and 500 shares to Minaret Developments Limited. He maintained that the said resolutions corrected the illegality and fraud allegedly perpetrated by the Plaintiff. 30.The 2nd Defendant further averred that the Plaintiff had refused to hand over company documents, including the title deed for L.R. No. 1/152 (Original Number 1/12/3), the company seal, accounting records, bank statements and bank correspondence despite numerous requests. He stated that the Plaintiff had no right to retain the documents since he was no longer a director and that such documents ought to remain in the custody of the company secretary. He therefore prayed that the Counterclaim be allowed as prayed. Reply to Defence and Defence to Counterclaim 31.The Plaintiff filed a Reply to Defence and Defence to Counterclaim dated 12th July 2025, denying the averments contained in the Joint Statement of Defence and Counterclaim save where expressly admitted and reiterating the contents of the Plaint dated 6th March 2024. 32.He maintained that the shareholding of the 1st and 3rd Defendants remained as pleaded in the Plaint and put the Defendants to strict proof of the contrary assertions. 33.The Plaintiff partially admitted that there existed a sale of shares agreement and that a judgment was delivered on 22nd November 2016, but asserted that the Judgment did not alter or interfere with the shareholding structure of the 3rd Defendant, save for granting one share to the 2nd Defendant and the deceased Samuel Mirii Gachathi. He maintained that he remained a shareholder of the 3rd Defendant. 34.The Plaintiff further averred that the issues concerning shareholding and entitlement raised by the Defendants had already been conclusively determined in Milimani HCCOMM Suit No. 539 of 2008. He maintained that he only sold one of his shares and never ceased being a shareholder of the 3rd Defendant. He further contended that the meeting held on 15th December 2009 and the resolutions passed therein were lawful, valid and had already been considered in the previous suit. He asserted that the Defendants were attempting to relitigate issues that had already been conclusively determined. 35.The Plaintiff denied allegations that he undertook fraudulent, dishonest or illegal activities and reiterated that the 1st and 2nd Defendants acted with ill will towards him. He further maintained that no discussion regarding his removal as director was held during the meeting of 16th March 2023 and denied the Defendants’ assertions to the contrary. 36.The Plaintiff averred that he was never accorded an opportunity to respond to any motion seeking his removal as director or shareholder and contended that the Defendants’ position was contradictory because they alleged he ceased being a shareholder and director by virtue of the 2008 sale agreement, yet subsequently convened meetings to remove him from those positions. He maintained that he remained both a shareholder and director of the 3rd Defendant and that he was integral to the management and operations of the company. He further averred that the meetings and proceedings undertaken by the Defendants were not conducted in accordance with the Articles of Association of the 3rd Defendant. 37.The Plaintiff further averred that the Counterclaim was res judicata as all questions relating to the shares and shareholding had already been conclusively determined by the court in the previous suit. He denied the Defendants’ assertions that he ceased being a shareholder and director upon execution of the sale agreement and maintained that the 2nd Defendant never automatically became a director by virtue of purchasing one share. He also maintained that he was lawfully entitled to convene and participate in meetings of the 3rd Defendant and that the meeting held on 15th December 2009, together with the resolutions passed therein, were lawful and free from fraud or illegality. 38.The Plaintiff further contended that it was contradictory for the Defendants to allege that he ceased being a shareholder and director in April 2008, yet still convene meetings more than fifteen years later to remove him. He denied the validity of the meeting held on 11th March 2024 and maintained that the resolutions passed therein were null, void, and prejudicial both to him and the 3rd Defendant. He reiterated that the shareholding of the 3rd Defendant remained as reflected in the company records and could not be altered without due process. 39.The Plaintiff further averred that he remained a director and shareholder of the 3rd Defendant and therefore lawfully retained custody of the company ownership documents. He consequently prayed that the Defence and Counterclaim dated 28th March 2024 be dismissed and judgment entered in terms of the Plaint dated 6th March 2024. Analysis and Determination 40.The Plaintiff filed written submissions dated 10th April 2026, while the Defendants filed joint submissions dated 25th March 2026. 41.I have considered the pleadings, the evidence on record, and the submissions filed by the parties. I identify the following issues as requiring determination:i.Whether the Plaintiff remained a Shareholder and Director of the 3rd Defendant despite the sale of his shareholding.ii.Whether the meeting and resolutions passed on 16th March 2023 were valid and enforceableiii.Whether the Counterclaim is res judicata Whether the Plaintiff remained a shareholder and director of the 3rd Defendant post 16th April 2008 42.The first issue that the court will consider is the shareholding of the 3rd Defendant when the Agreement of Sale of Shares dated 16th April 2008 was entered into. 43.It is not contested that by the Agreement for Sale of Shares dated 16th April 2008, the Plaintiff sold his sole ordinary share in the 3rd Defendant to the 2nd Defendant and Samuel Mirii Gachathi (deceased) for a consideration of Kshs. 23,570,000/=. 44.The Agreement provided at Clause 6(e) thereof that:“The vendor (Plaintiff herein) shall deliver to the purchaser (the 2nd Defendant) a signed letter of resignation as a director of the company with written acknowledgment from him that he has no claim whatsoever against the company.” 45.At the time of that Agreement, the 3rd Defendant had three issued shares, each representing an equal one-third ownership interest in the company, and its sole asset was the parcel of land known as L.R No. 1/152 (Original Number 1/12/3). The Plaintiff held one of those three shares. This is seen under Clauses A, B, and C of the agreement, which was produced on pages 1-7 of the Defendants’ bundle of documents. 46.It is equally undisputed that disputes arose regarding completion of the transaction, culminating in HCCC No. 539 of 2008, wherein the court granted an order of specific performance compelling the transfer of the share. The Court stated that:“…in particular, the 1st defendant shall execute the share transfer forms in respect of the company transferring one (1) share held by the 1st Defendant as at the date of the agreement herein in favour of the plaintiffs.” 47.The significance of that judgment cannot be understated. The court conclusively determined that the Agreement dated 16 April 2008 was valid, enforceable, and binding upon the Plaintiff. The Plaintiff neither appealed against nor succeeded in setting aside that judgment. 48.In this court's view, once specific performance was decreed, the Plaintiff could no longer assert rights inconsistent with the agreement whose validity had been judicially affirmed. Equity treats as done that which ought to be done. In Macharia Mwangi Maina & 87 Others v Davidson Mwangi Kagiri [2014] eKLR, the Court of Appeal held that where parties have entered into a valid and enforceable agreement, equity recognizes and protects the beneficial interests thereby created. 49.Having contracted to dispose of his share and having been compelled by court order to complete that transaction, the Plaintiff could not continue asserting beneficial ownership of the same share to the detriment of the purchasers. 50.The evidence on record demonstrates that during the pendency of HCCC No. 539 of 2008, the Plaintiff presided over a meeting held on 15 December 2009 in which an additional 997 shares were allotted. The practical effect of that allotment was to reduce the purchasers' entitlement from one-third of the company to a negligible fraction of the shareholding. 51.The Plaintiff's explanation that he remained entitled to deal with the company's affairs because the transfer had not been formally completed cannot be accepted. I agree with the Defendants’ submissions. It is settled law that a party cannot rely upon his own failure to perform contractual obligations as a basis for defeating the rights of the other contracting party. 52.In Trans Mara Sugar Company Limited & Another v Ayiemba & Another [2020] KEHC 3762 (KLR), the court reiterated the principle that a litigant ought not to be permitted to benefit from his own wrongdoing. The Court stated that:“73.There is the issue of public interest as well. Courts must protect the public from deceit and help maintain standards of commercial morality….75.The position that a party ought not to benefit from intentional and own-made illegalities is so central and easily flows from the above values and constitutional principles.” 53.The allotment of 997 shares while the specific performance suit was pending had the effect of diminishing the purchasers' entitlement under the agreement and undermining the effectiveness of any decree that the court might ultimately issue. Equity cannot countenance such conduct. 54.I therefore find that upon execution of the Agreement in April 2008, and certainly upon the judgment in HCCC No. 539 of 2008, for specific performance delivered on 16 November 2016, the Plaintiff ceased to possess any beneficial interest in the share he had agreed to sell. 55.It follows, therefore, that the meeting and resolutions held on 15 December 2009, which allotted additional shares to shareholders, initiated by the 1st Plaintiff, were fundamentally defective on the basis that he had no legal capacity to do so, having ceased to be a shareholder or director pursuant to the agreement of 16 April 2008. 56.Further, the meeting and resolutions are also defective as the purchasers of the share, who acquired beneficial ownership, were not part of the proceedings and were not notified. Whether the Resolutions of 16 March 2023 and 11 March 2024 were valid 57.The Plaintiff contends that the resolutions were unlawful and violated both the Companies Act and the Articles of Association of the 3rd Defendant. 58.Article 13 of the 3rd Defendant’s Articles of Association, produced at pages 16–31 of the Plaintiff’s Trial Bundle, provides as follows:“Until otherwise determined the number of Directors shall not be less than two and not more than seven. The names of the first Directors shall be determined in writing by the subscribers of the Memorandum of Association or a majority of them and until such determination the signatories to the Memorandum of Association shall be the first Directors, and the directors must be shareholders.” 59.Section 30 of the Companies Act provides that a company's constitution binds the company and its members as though they had covenanted to observe its provisions. It follows that the Articles of Association of the 3rd Defendant bound both the Plaintiff and the Defendants in equal measure. 60.The principle that a company's constitution constitutes a binding statutory contract between the company and its members was established in Hickman v Kent or Romney Marsh Sheep-Breeders' Association [1915] 1 Ch 881. 61.From the foregoing provisions of the law and the 3rd Defendant’s Articles of Association, it is clear that a director must be a shareholder. Evidence on record demonstrates that the Plaintiff automatically ceased to qualify as a director upon divesting himself of his only share 62.Further, the removal of directors is governed by sections 139 and 141 of the Companies Act. Section 139 permits the removal of a director by ordinary resolution, while section 141 guarantees the affected director notice of the proposed resolution and an opportunity to make representations. 63.The evidence on record shows that notices of the meetings scheduled for 16 March 2023 and 11 March 2024 were served upon the Plaintiff. Indeed, the Plaintiff admitted that he attended the meeting of 16 March 2023, but chose not to attend the meeting of 11 March 2024. 64.Unlike cases where a director is excluded from participation, the Plaintiff was allowed to participate in the deliberations affecting him. 65.The court in Van Zyl & Another NNO v Nucor Chrome Botswana (Pty) Ltd & Others [2013] ZAGPJHC 40 observed that the critical inquiry is whether meetings were properly convened and whether affected persons were afforded an opportunity to participate. 66.On the evidence before the court, I am satisfied that the meetings were duly convened and that the Plaintiff was accorded adequate notice and an opportunity to be heard. 67.More importantly, the purpose of the impugned resolutions was to rectify the consequences of the 2009 allotment and to align the company's affairs with the judgment in HCCC No. 539 of 2008. 68.Sections 862 and 863 of the Companies Act expressly confer jurisdiction upon the court to rectify a company's register where entries have been improperly made or where delay has occurred in recording the true position. 69.In the circumstances, the court finds that the resolutions were not intended to oppress the Plaintiff but rather to restore the company's shareholding structure to one consistent with the rights recognized by the judgment of the court. 70.I therefore find that the resolutions passed on 16 March 2023 and 11 March 2024 were lawful and valid. Whether the Counterclaim is barred by Res Judicata 71.The Plaintiff contends that the Counterclaim is barred by section 7 of the Civil Procedure Act. 72.Section 7 provides that no court shall try a matter that has been directly and substantially in issue in a former suit between the same parties and finally determined by a competent court. 73.The applicable principles were authoritatively restated by the Court of Appeal in Independent Electoral and Boundaries Commission v Maina Kiai & 5 Others [2017] eKLR. The Court at paragraph 74 of the Judgment stated as follows:“Thus, for the bar of res judicata to be effectively raised and upheld on account of a former suit, the following elements must all be satisfied, as they are rendered not in disjunctive, but conjunctive terms;i.The suit or issue was directly and substantially in issue in the former suit.ii.That former suit was between the same parties or parties under whom they or any of them claim.iii.Those parties were litigating under the same title.iv.The issue was heard and finally determined in the former suit.v.The court that formerly heard and determined the issue was competent to try the subsequent suit or the suit in which the issue is raised.” 74.In the present case, the Plaintiff claimed that the issues raised by the Defendants in the counterclaim had already been considered in HCCC No. 539 of 2008 and the ruling delivered on 23 September 2021. 75.I have considered the Judgment in Civil Suit No. 539 of 2008 as produced in the Plaintiff’s bundle of documents. It reveals that the suit concerned whether the Plaintiff was in breach of the Agreement for Sale of Shares and whether specific performance ought to be ordered. The present proceedings concern a distinct question, namely, whether the resolutions passed at meetings held in 2023 and 2024 were validly convened and properly passed. The cause of action and subject matter in the two cases are therefore distinct. 76.Further, the Ruling of 23rd September 2021 dismissed an application for review but did not determine the merits of whether the share dilution effected on 15th December 2009 was valid or otherwise. 77.In Uhuru Highway Development Ltd v Central Bank of Kenya & Others [1996] eKLR, the Court of Appeal emphasized that for res judicata to apply, the issues in both proceedings must be identical. 78.The present dispute arises from corporate actions undertaken in 2023 and 2024 and therefore concerns a different cause of action. 79.While the principle in Henderson v Henderson (1843) 67 ER 313 discourages piecemeal litigation, the present Counterclaim concerns matters that crystallized after the conclusion of the earlier proceedings. 80.I am therefore not persuaded that the Counterclaim is barred by section 7 of the Civil Procedure Act. 81.Based on the foregoing analysis, I dismiss the Plaintiff’s claim for lack of merit. The Counterclaim succeeds. 82.Accordingly, Judgment is hereby entered for the Defendants on the Counterclaim.a.The Plaintiff's suit is hereby dismissed with costs.b.It is hereby declared that the 2nd Defendant became entitled to the Plaintiff's one-third beneficial interest in the 3rd Defendant pursuant to the Agreement for Sale of Shares dated 16 April 2008 and the judgment in HCCC No. 539 of 2008.c.The resolutions passed on 16 March 2023 and 11 March 2024 are hereby declared lawful, valid, and enforceable.d.The Registrar of Companies is directed, pursuant to sections 862 and 863 of the Companies Act, to rectify the records of the 3rd Defendant to reflect the lawful shareholding structure consistent with the judgment in HCCC No. 539 of 2008.e.The Defendants shall have the costs of the suit and the Counterclaim. 83.It is so decreed DATED, SIGNED, AND DELIVERED AT NAIROBI THIS 28 DAY OF MAY 2026HON. MR. JUSTICE MOSES ADOJudge of the High CourtIn the Presence of:Moses C/AMwachofi………………for the PlaintiffMunyalo……………for the Defendants