https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/7405

In re ABSS Warehouses Limited (Ex-Parte Applicant) (Miscellaneous Application 568 of 2026) [2026] KEHC 7405 (KLR) (Commercial and Tax) (26 May 2026) (Ruling) Neutral citation: [2026] KEHC 7405 (KLR) Republic of Kenya In the High Court at Nairobi (Milimani Commercial Courts) Commercial and Tax Miscellaneous Application 568 of 2026 MO Ado, J May 26, 2026 IN THE MATTER OF: ABSS WAREHOUSES LIMITED (EX- PARTE APPLICANT) AND IN THE MATTER OF: A SUPPLEMENTAL CHARGE OVER TITLE NO. KERICHO/BOIYWEK/476 AND IN THE MATTER OF: SECTIONS 878 AND 888 OF THE COMPANIES ACT, 2015 Ruling 1.The Ex-Parte Applicant, ABSS Warehouses Limited, Moved this Court by a Notice of Motion dated 25th May 2026 seeking an extension of time to register a Supplemental Legal Charge dated 5th December 2025 executed over the property known as Title No. Kericho/Boiywek/476 in favour of SBM Bank (Kenya) Limited. The Application is brought pursuant to Sections 878 and 888 of the Companies Act, 2015. 2.The Motion is supported by the affidavit of Sammy Ibrahim Mwaura, Advocate, who deposes that the Supplemental Charge was duly executed and registered at the Kericho Land Registry on 5th December 2025. However, due to administrative and systemic delays at the Land Registry, the fully registered and endorsed original document was not released back to counsel's custody on time. Consequently, the 30-day statutory period prescribed under Section 878(1) of the Companies Act, 2015 lapsed before the charge could be lodged for registration with the Registrar of Companies. 3.The Applicant contends that the omission was inadvertent, non-deliberate, and caused entirely by institutional constraints. It is further averred that the essential credit facility secured by this instrument cannot be disbursed to the Applicant until a Certificate of Mortgage is issued, causing ongoing commercial prejudice. 4.Under Section 888 of the Companies Act, 2015, this Court has wide, discretionary jurisdiction to extend the time for registration of a charge if satisfied that the failure to register was accidental, due to inadvertence, or some other sufficient cause, and that it is not of a nature to prejudice the position of creditors or shareholders. 5.Having considered the Application and the supporting annexures, I find that the delay in retrieving the title documents from the land office constitutes "sufficient cause". The Applicant demonstrated due diligence by registering the primary instrument at the Land Registry on the exact day of its execution. There is no evidence of bad faith or active prejudice to third-party creditors; rather, the order seeks to formalize an authorized commercial transaction to facilitate funding. 6.In re ABSA Bank Kenya PLC (Miscellaneous Cause E024 of 2026) [2026] KEHC 148 (KLR), the Court emphasized that the discretion to enlarge time is well-recognized where sufficient cause is shown. 7.Similarly, in Bank of Baroda Kenya Ltd v Registrar of Companies [2025] eKLR. the Court held that where a charge has been duly executed, stamped, and registered at the Lands Registry, the subsequent failure to lodge it with the Registrar of Companies within the 30-day window is a procedural omission that is clearly rectifiable. 8.Applying the above principles to the facts of this case, the Court finds that the Applicant has acted in good faith and that granting the extension will regularize the security position without harming third parties. 9.Accordingly, I make the following Orders:i.The time for registration with the Registrar of Companies of the Supplemental Legal Charge dated 5th December 2025 over Title No. Kericho/Boiywek/476 created by ABSS Warehouses Limited in favour of SBM Bank (Kenya) Limited is hereby extended for a period of thirty (30) days from the date hereof.ii.The Registrar of Companies shall admit the said Charge for registration upon presentation and payment of the requisite statutory fees.iii.The costs of this application shall be borne by the Applicant. 10.It is so ordered. DATED, SIGNED, AND DELIVERED AT NAIROBI THIS 26TH DAY OF MAY 2026HON. MR. JUSTICE MOSES ADOJUDGE OF THE HIGH COURT