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Tanzania Judgment

TZHCCOMD

agapiti edward kobello another vs registrar of companies 2023 tzhccomd 270 9 august 2023

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Source document

01

Holding and result

The court found that due to the death of two out of three directors, it was impracticable for the company to transact business or convene meetings, justifying the grant of orders to allow the 1st Applicant to convene a shareholders meeting and update company records.

Court disposition

Application granted

Orders

  • The 1st Applicant is ordered to convene a shareholders meeting and pass a resolution to update company records at BRELA through the ORS and appoint new directors.
  • The shareholders meeting must be convened within 90 days from the date of the ruling and necessary changes made in the BRELA ORS within the same period.

02

Material facts

Parties

Agapiti Edward Kobello

1st Applicant Counsel: Richard Mwalingo

Arbiter Tanzania Limited

2nd Applicant Counsel: Richard Mwalingo

Registrar of Companies

Respondent Counsel: Grace Umoti

03

Procedural history

  1. Posture

    Miscellaneous Commercial Application / Ruling on Application for Orders Under Certificate of Urgency

04

Questions and positions

Legal issues

Whether the court should grant leave for the 1st Applicant to convene a shareholders meeting and update company records in the BRELA ORS due to lack of quorum caused by death of directors

Party arguments

Applicant
The 2nd Applicant is left with only one director, making it impracticable to transact business or convene meetings as required by law. The Respondent intends to remove the 2nd Applicant from the registry for failure to file annual returns. Urgent intervention is needed to allow appointment of new directors and update company records.
Respondent
The Respondent did not object to the application and supported the granting of the prayers sought.

05

Court’s reasoning

  1. 01

    Section 137(1) and (2)(b) of the Companies Act, Cap.212 R.E 2002

    Where it is impracticable to call a meeting of a company in the manner prescribed by the Companies Act, the court may order a meeting to be called, held and conducted in such manner as it thinks fit.

06

Ratio, limits and disposition

Ratio decidendi

The court found that due to the death of two out of three directors, it was impracticable for the company to transact business or convene meetings, justifying the grant of orders to allow the 1st Applicant to convene a shareholders meeting and update company records.

Court disposition

Application granted

  • The 1st Applicant is ordered to convene a shareholders meeting and pass a resolution to update company records at BRELA through the ORS and appoint new directors.
  • The shareholders meeting must be convened within 90 days from the date of the ruling and necessary changes made in the BRELA ORS within the same period.

Source and reliance status

TZHCCOMD · 9 August 2023

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Judgment reading view

Judgment text

The complete available source text.

Source document

TZHCCOMD

Judgment· 9 August 2023

agapiti edward kobello another vs registrar of companies 2023 tzhccomd 270 9 august 2023

IN THE HIGH COURT OF THE UNITED REPUBLIC OF

TANZANIA (COMMERCIAL DIVISION) AT DAR-ES-SALAAM MISC. COMMERCIAL APPLICATION NO.30 OF 2023 AGAPITI EDWARD KOBELLO ………………….………..1ST APPLICANT ARBITER TANZANIA LIMITED…………………………..2ND APPLICANT

VERSUS REGISTRAR OF COMPANIES………………………..……. RESPONDENT Date of Ruling: 09/08/2023

RULING NANGELA, J.: This application was brought to the attention of this Court under a certificate of urgency. The urgency of the matter is premised on two main grounds, to wit, that: 1. The Respondent is intending to remove the 2nd Applicant from the companies’ registry for failure to file annual returns as required by the Companies Act, Cap.212 R.E 2002.

2. That, the 1st Applicant wants to make changes in the Online Registration System (ORS) and updating the second Applicant Page 1 of 6 information thus, there are some changes which are in need of Board Resolution and the Respondent issued a short notice against the Applicants to update and make changes in the ORS. The chamber summons, which was filed in this court under section 137 (1) and (2)(b) of the Companies Act, Cap.212 R.E 2002, was supported by an affidavit deponed by the 1st Applicant, Agapiti Edward Kobelo. To it was attached to several other documents forming part of the same affidavit. In the chamber summons the Applicants seek for the following orders of this court: 1. That, this Honourable Court be pleased to give an order that the 1st Applicant convene a shareholders meeting and pass a resolution so as to update the Company records at BRELA through the BRELA Online Registration System (ORS) and make changes in the Company by Page 2 of 6 appointing new shareholders/ Directors.

2. Any other ancillary or consequential directives as the Court thinks fit and just to grant. When the application was called on for hearing on this 09th day of August 2023, Mr. Richard Mwalingo, learned counsel appeared representing the Applicants. On the other hand, Ms. Grace Umoti, State Attorney appeared for the Respondent. In his brief submission, Mr. Mwalingo urged this court to grant the prayers sought. He noted that, this matter was brought under a certificate of urgency because the 2nd Respondent is left with only one director who is unable to transact the business of the company for lack of the requisite quorum. Mr. Mwalingo told this court that the Respondent was duly served with this application. For her part, Ms. Umoti did not object to the granting of the prayers sought. She supported the application. I have considered the submission made by Mr. Mwalingo and examined the chamber summons and its supporting affidavit. Essentially, the facts disclosed in the affidavit are to the Page 3 of 6 effect that, the 2nd Applicant was registered in the year 1994 with three shareholders and Directors, namely: Agapiti Edward Kobelo, Emmanuel Jonathan Muton and Pendael Jonathan Kingu, each holding 150 unpaid shares. Unfortunately, the two shareholders and Directors of the 2nd Applicant passed on at different times, one (Mr. Emmanuel Muton) having passed on in the year 2004,

January 1st and the other Mr. Pendael Jonathan Kingu having passed on in the year 2021. Attached were copies of Letters of Administration of the estates of the later Muton annexed to the affidavit as annexure AGK-2 collectively. It follows that, the 2nd Applicant is left with one Director, a fact which makes it impracticable to call for the requisite meetings of the 2nd Applicant to transact its businesses, hence this application. Since the application has not been resisted, and for good reasons, this court proceeds to grant the prayers sought and make the following orders: 1. That, the 1st Applicant is hereby ordered to convene a shareholders meeting and pass a resolution so as to update the Page 4 of 6 Company records at BRELA through the BRELA Online Registration System (ORS) and make the necessary changes in the Company by appointing new Directors who will transact the business affairs of the company.

2. That, the said meeting of shareholder be convened within 90 days from the date of this ruling and the necessary changes be made in the BRELA ORS within the same period stated herein at No.1 above. Order accordingly. DATED AT DAR-ES-SALAAM ON THIS 04TH DAY OF AUGUST 2023 …………………………………………………………………….

DEO JOHN NANGELA

JUDGE Date: 09/08/2023 Coram: Hon. Nangela, J. For the Applicants: Mr. Richard Mwalingo, Advocate Page 5 of 6 For the Respondent: Ms. Grace Umoti, State Attorney C/Clerk: Joyce Ndossi Court: Ruling delivered today, this 09th of August 2023 in the presence of both parties. …………………………………………………………………….

DEO JOHN NANGELA JUDGE. Page 6 of 6

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Authorities

Authorities used by the court

Cases, legislation, regulations, and constitutional provisions identified in the available record.

Companies Act, Cap.212 R.E 2002

Legislation

Legislation referenced in the available case record.

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