Mumbu Holdings Ltd v Credit Bank Ltd & 3 others (Commercial Case E727 of 2021) [2026] KEHC 9201 (KLR) (Commercial and Tax) (18 June 2026) (Ruling)

Mumbu Holdings Ltd v Credit Bank Ltd & 3 others (Commercial Case E727 of 2021) [2026] KEHC 9201 (KLR) (Commercial and Tax) (18 June 2026) (Ruling) Neutral citation: [2026] KEHC 9201 (KLR) Republic of Kenya In the High Court at Nairobi (Milimani Commercial Courts) Commercial and Tax Commercial Case E727 of 2021 MO Ado, J June 18, 2026 Between Mumbu Holdings Limited Plaintiff and Credit Bank Limited 1st Defendant Skytop Technology Limited 2nd Defendant Kimani & Michuki Advocates 3rd Defendant Geoffrey Wekesa Advocate 4th Defendant Ruling 1.For determination is the Plaintiff's Notice of Motion dated 1st July 2025 brought under sections 3, 4(1) and 5 of the Contempt of Court Act, Order 40 and Order 51 of the Civil Procedure Rules, section 5(1) of the Judicature Act, Order 52 Rule 3 of the Rules of the Supreme Court of England 1965, the Practice and Procedure Rules (Part 1 Rule 3) and section 3A of the Civil Procedure Act. 2.The application seeks, in the main, that the Chief Executive Officer, Mrs. Betty Korir, of Credit Bank, be cited for contempt of court for such period as this Honourable Court may deem fit and just for having disobeyed the orders issued on 25th November 2022 restraining the Respondents, their servants or agents from selling, leasing, transferring, alienating, disposing of or otherwise interfering with LR No. 209/8336/66 pending the hearing and determination of the suit. The Plaintiff's Case 3.The application is premised on the grounds that on 25th November 2022, this court issued injunctive orders restraining the Defendants, their servants and agents from selling, leasing, transferring, alienating, disposing of, or otherwise interfering with LR No. 209/8336/66 pending the hearing and determination of the suit. 4.The Plaintiff contends that despite the subsistence of those orders, the 1st Defendant proceeded to sell the property in March 2025 and evicted the tenants on 21st June 2025. 5.The Plaintiff further avers that the purported purchaser informed the tenants that he had been advised that the suit challenging the sale had been dismissed in March 2025, whereas the suit remained pending and was scheduled for hearing on 7th July 2025. 6.According to the Plaintiff, the sale and subsequent eviction constituted deliberate, blatant and contemptuous disobedience of clear and unambiguous court orders, thereby warranting the citation and committal of the Chief Executive Officer of the 1st Defendant for contempt. The 1st Defendant's Response 7.The application is opposed through a Replying Affidavit sworn on 22nd July 2025 by the Head of Legal Services of the 1st Defendant. 8.The deponent states that he was duly authorised to swear the affidavit on behalf of the bank and was conversant with the matters in issue. 9.He challenges the Plaintiff's standing, contending that Belinda Mbuu lacked authority to institute both the suit and the application on behalf of the Plaintiff company. He points to HCCOMM E117 of 2022, in which she had sought leave to institute a derivative action on behalf of the company. 10.The 1st Defendant further contends that the application is improperly anchored upon provisions of the Contempt of Court Act which were declared unconstitutional. 11.On the merits, the deponent acknowledges that the court issued an injunction on 25th November 2022 restraining dealings with the suit property. However, he avers that by operation of Order 40 Rule 6 of the Civil Procedure Rules, the injunction automatically lapsed after twelve months since the suit had not been determined within that period and no extension had been sought or granted. 12.The 1st Defendant states that the property was sold by public auction on 21st March 2025 and annexes the Certificate of Sale, Memorandum of Sale and Certificate of Lease. 13.It is the bank's position that at the time of the sale there was no subsisting injunction capable of being disobeyed and therefore no contempt could arise. 14.The bank further avers that all statutory notices were duly issued and the statutory power of sale was lawfully exercised. 15.The deponent also states that the outstanding debt stood at Kshs. 27,419,836.25 as at 5th October 2021 and continued to accrue interest and penalties. He contends that no meaningful effort had been made towards repayment following the issuance of the injunction, thereby occasioning prejudice to a bank that deals with public funds. 16.He therefore urged the court to dismiss the application with costs. Analysis and Determination 17.I have considered the application, the rival affidavits and the parties' submissions. The sole issue for determination is whether the 1st Defendant is guilty of contempt of court. 18.It is settled law that contempt proceedings are quasi-criminal in nature and a court will only punish a contemnor where there is clear proof of deliberate disobedience of a valid and subsisting court order. 19.In Mutitika v Baharini Farm Limited [1985] KLR 227, the Court of Appeal held that the standard of proof in contempt proceedings is higher than proof on a balance of probabilities though not as high as proof beyond reasonable doubt. 20.Similarly, in Republic v Ahmad Abolfathi Mohammed & Another [2018] eKLR, the Court of Appeal observed that because contempt proceedings may result in loss of liberty, the standard of proof is higher than that applicable in ordinary civil proceedings. 21.The elements that an applicant must establish in contempt proceedings were succinctly captured in Samuel M. N. Mweru & Others v National Land Commission & 2 Others [2020] eKLR, where Mativo J (as he then was) stated that:“ 40.It is an established principle of law that in order to succeed in civil contempt proceedings, the applicant has to prove (i) the terms of the order, (ii) Knowledge of these terms by the Respondent, (iii). Failure by the Respondent to comply with the terms of the order. Upon proof of these requirements the presence of willfulness and bad faith on the part of the Respondent would normally be inferred, but the Respondent could rebut this inference by contrary proof on a balance of probabilities. Perhaps the most comprehensive of the elements of civil contempt was stated by the learned authors of the book Contempt in Modern New Zealand who succinctly stated:-"There are essentially four elements that must be proved to make the case for civil contempt. The applicant must prove to the required standard (in civil contempt cases which is higher than civil cases) that:-(a)the terms of the order (or injunction or undertaking) were clear and unambiguous and were binding on the defendant;(b)the defendant had knowledge of or proper notice of the terms of the order;(c)the defendant has acted in breach of the terms of the order; and(d)the defendant's conduct was deliberate.” 22.In the present case, there is no dispute that Mabeya J issued an interlocutory injunction on 25th November 2022 restraining the Defendants from dealing with LR No. 209/8336/66 pending the hearing and determination of the suit. 23.The question that arises is whether those orders were still subsisting when the property was sold on 21st March 2025. 24.Order 40 Rule 6 of the Civil Procedure Rules provides as follows:“Where a suit in respect of which an interlocutory injunction has been granted is not determined within a period of twelve months from the date of the grant, the injunction shall lapse unless for any sufficient reason the court orders otherwise." 25.The effect of the foregoing provision was considered by the Court of Appeal in Barclays Bank of Kenya Limited v Henry Ndungu Kinuthia & Another [2018] eKLR where the court stated:“A plain reading of Order 40 Rule 6 shows that the rule is couched in mandatory terms, and that the only situation in which an interlocutory injunction will not automatically lapse after 12 months by operation of law is where the court has given a sufficient reason why the interlocutory injunction should not lapse." 26.The Court further stated:“The order made by the court on 22nd February 2011 remained subject to Order 40 Rule 6 that required that such an interlocutory order remain in force for a period of 12 months only, but subject to the court having the power to extend the interlocutory order beyond the 12 months, if there is sufficient reason for it to do so. In our view, such an extension cannot be done by way of a blanket order at the time the interlocutory order is issued. The need for the extension must be addressed by the court and justified at the opportune time." 27.Applying the foregoing principles, the injunction issued on 25th November 2022 lapsed by operation of law on or about 25th November 2023, there being no application for extension and no order extending its duration. 28.Consequently, when the 1st Defendant exercised its statutory power of sale on 21st March 2025, there was no subsisting injunction capable of being disobeyed. 29.n the absence of a valid and subsisting order, one of the essential ingredients of contempt proceedings is absent. 30.It follows that no wilful or deliberate disobedience of a court order has been established. 31.The Plaintiff has therefore failed to satisfy the threshold required for the court to invoke its contempt jurisdiction. 32.The upshot of the foregoing is that the Notice of Motion dated 1st July 2025 lacks merit and is hereby dismissed. 33.Costs of the application, hereby assessed at Kshs. 50,000/=, are awarded to the 1st Defendant. 34.It is so ordered. DATED, SIGNED, AND DELIVERED AT NAIROBI THIS 18TH DAY OF JUNE 2026HON. MR. JUSTICE MOSES ADO JUDGE OF THE HIGH COURTIn the Presence of:Moses C/ABizmimana………………for the ApplicantGakunga……………for the Dfendants/Respondent