[2010] KEHC 753 (KLR)
The court found that the applicants had demonstrated sufficient cause for the delay in registering the charges, namely that the directors of the respondent company were out of the country and only returned after the statutory period had lapsed. The court exercised its discretion under section 96 of the Companies Act...
Source-derived case information.
- Citation
- [2010] KEHC 753 (KLR)
- Parties
- Applicant: Savings and Loan Kenya Limited; Applicant: Kenya Commercial Bank Limited; Respondent: S.A.M. Company Limited
- Court
- High Court
- Court Station
- High Court at Nairobi (Milimani Commercial Courts)
- Jurisdiction
- Kenya
- Case Number
- Miscellaneous Application 337 of 2010
- Procedural Posture
- Miscellaneous Application / Ruling on Application for Extension of Time to Register Charges
- Outcome
- application granted
- Judges
- A. Ong’injo
- Legal Topics
- Registration of Charges, Company Security Interests, Extension of Time, Land Charges
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Savings and Loan Kenya Limited
Applicant
Kenya Commercial Bank Limited
Applicant
S.A.M. Company Limited
Respondent
Procedural Posture
Miscellaneous Application / Ruling on Application for Extension of Time to Register Charges
Legal Issues
- 1 Whether the court should extend the time for registration of a charge and second charge under section 96 of the Companies Act.
- 2 Whether the applicants have provided sufficient cause for the delay in registration of the charges.
Ratio Decidendi
The court found that the applicants had demonstrated sufficient cause for the delay in registering the charges, namely that the directors of the respondent company were out of the country and only returned after the statutory period had lapsed. The court exercised its discretion under section 96 of the Companies Act to grant an extension of 40 days from the date of the order for the registration of the charge and second charge. The court was satisfied that the applicants would otherwise be prejudiced in respect of their security interests if the extension was not granted.
Court Disposition
application granted
Orders
- Time for registration under section 96 of the Companies Act of the charge and second charge is extended by 40 days from the date of this order.
- The extension applies to the charge dated 30th April 2008 between S.A.M. Company Limited and Savings and Loan Kenya Limited, and the second charge dated 26th October 2009 between S.A.M. Company Limited and Kenya Commercial Bank Limited.
Full Case Text
Judgment text and source record
33 paragraphs
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA
AT NAIROBI
(MILIMANI COMMERCIAL & TAX DIVISION)
MISC. APPLICATION NO. 337 OF 2010
IN THE MATTER OF SAVINGS AND LOAN KENYA LIMITED
AND
IN THE MATTER OF KENYA COMMERCIAL BANK LIMITED
AND
IN THE MATTER OF THE COMPANIES ACT CAP 486 LAWS OF KENYA
AND
IN THE MATTER OF AN APPLICATION FOR REGISTRATION OF A CHARGE & SECOND CHARGE
UNDER SECTION 96 OF THE COMPANIES ACT CAP 486 LAWS OF KENYA
SAVINGS AND LOAN KENYA LIMITED............................................................................................1ST APPLICANT
KENYA COMMERCIAL BANK LIMITED..........................................................................................2ND APPLICANT
VERSUS
S.A.M. COMPANY LIMITED..................................................................................................................RESPONDENT
R U L I N G
This ruling relates to a notice of motion application brought under Companies Act Section 96 and 102 of the Companies (High Court) Rules L.N. 312/1964. It seeks the following orders
1. THAT this matter be certified as urgent and be heard exparte.
2. THAT the time for registration under section 96 of the Companies Act of the Charge and Second Charge particulars whereof are given herewith BE EXTENDED by 40 days from the date of the order to be made herein.
During the hearing of the application, the applicant’s counsel, Ms. Ogulla submitted that her client has already disbursed a total of Kshs. 71 million to the respondent pursuant to a charge dated 23rd October, 2008 and the second charge of 26th October, 2009. Further to the above, she also submitted that the applicants are in a precarious position as far as their security is concerned due to the non registration of the two charges. It is on that note that she has prayed for extension of time to register the charges. According to the learned counsel, the reason for the delay is that the Directors of the Chargor have been out of the country and only came back in January 2010. Unfortunately by that time the statutory period of 42 days had already lapsed.
After carefully considering the application together with the anenxtures, I hereby grant the same in terms of prayer no. 2. Specifically, I hereby direct that the time for registration under section 96 of the Companies Act of the charge and second charge whose particulars are given herewith, be extended by 40 days from today’s date. The said charges are as follows:
(a)A Charge on Title Number I.R. 91371 (being Land Reference Number 37/37 made on the 30th day of April 2008 between S.A.M. COMPANY LIMITED (the Respondent) Therein referred to as “the Chargor”) of the one part and SAVINGS AND LOAN KENYA LIMITED (the 1st Applicant) (therein referred to as “the Lender”) of the other part.
(b)A Second Charge on Title Number I.R. 91371 (being Land Reference Number 37/37 made on the 26th day of October 2009 between S.A.M COMPANY LIMITED (the Respondent) (therein referred to as “the Chargor”) of the one part and KENYA COMMERCIAL BANK LIMITED (the 2nd Applicant) (therein referred to as “the Lender”) of the other part.
Those are the orders of this court.
MUGA APONDI
JUDGE
Ruling read signed and delivered in open court in the presence of:
Ms. Ogulla - Applicant’s Counsel
MUGA APONDI
JUDGE
3RD MAY, 2010