Mugambi Zakayo Nteere Enterprises Ltd & 2 others v Kabutu Enterprises Ltd & another [2023] KEHC 889 (KLR)

Mugambi Zakayo Nteere Enterprises Ltd & 2 others v Kabutu Enterprises Ltd & another (Civil Case E010 of 2022) [2023] KEHC 889 (KLR) (9 February 2023) (Ruling)

Neutral citation: [2023] KEHC 889 (KLR)

Republic of Kenya

In the High Court at Meru

Civil Case E010 of 2022

TW Cherere, J

February 9, 2023

Between

Mugambi Zakayo Nteere Enterprises Ltd

1st Plaintiff

Mugambi Nkiruta Enterprises Ltd

2nd Plaintiff

Sammy Bundi & Mary Mugambi (Suing as legal representatives of the Estate of Mugambi Nkiruta- Deceased)

3rd Plaintiff

and

Kabutu Enterprises Ltd

1st Defendant

Gatobu Enterprises Ltd

2nd Defendant

Ruling

Brief facts 1. On 27th October, 2022, this court issued the following orders:1. The 3rd Plaintiff/ Applicants did not at the time of filing this suit have the legal capacity to represent the estate of Mugambi Nkiruta. The 3rd Plaintiff/Applicants are therefore struck out of this suit.2. The orders of temporary injunction sought in the notice of motion dated 17th August, 2022 are barred by Order 2 Rule 6(1) of the Civil Procedure Rules and are unsustainable.3. The order restraining the Respondents, their agents or anyone else acting on their authority from interfering and or withdrawing any funds from Cooperative Bank Account No. 011xxxxx and from interfering with the 1st Applicant’s business operations, transactions and or assets or in any other way purporting to run the affairs of Mugambi Zakayo Nteere Enterprises Ltd pending the hearing and determination of the derivative suit issued on 01st September, 2022 is set aside,4. This suit is stayed pending the determination to be made in Nkubu SPMCC No. E036 of 2022 that was filed earlier5. The determination of whether leave to bring a derivative suit ought to be granted is similarly stayed pending the determination to be made in Nkubu SPMCC No. E036 of 2022 that was filed earlier6. Applicants shall bear the costs of this application7. Mention on 01st December, 2022 to confirm the outcome in Nkubu SPMCC No. E036 of 2022 and for further orders

2. By notice of motion dated 02nd November, 2022, Applicants seek the following orders:1. The Honourable Court be pleased to lift, set aside and or vacate orders 4 and 5 of the ruling dated 27th October, 2022 pending the hearing and determination of the derivative suit2. Leave to amend the plaint be granted3. Costs be borne by Respondents

3. The application is based on grounds among others that:1. Nkubu SPMCC No. E036 of 2022 was withdrawn by orders issued on 19th October, 20222. 4th Plaintiff has obtained ad-litem to protect the interest of Mugambi Nkiruta issued on 25th August, 2022

4. The application is also supported by an affidavit sworn on 02nd November, 2022 by the first 3rd Applicant Sammy Bundi Mugambi reiterating the grounds on the face of the application.

5. Respondents opposed the application vide a replying affidavits sworn on 14th December, 2022 by Zaverio Gatobu M’Ithinji, a director of the 2nd Respondent. He avers that the application is filed by parties that were struck out of the suit and who cannot be conferred capacity to sue by a grant issued after filing of the suit. Reliance was made to Trouistik Union International & another v Jane Mbeyu & another [1993] eKLR.

6. I have considered the application in the light of the affidavits on record and annexures thereto and submissions on behalf of the Applicants.

7. Review of court orders is governed by Section 80 of the Civil Procedure Act which provides inter alia: -Any person who considers himself aggrieved—a.by a decree or order from which an appeal is allowed by this Act, but from which no appeal has been preferred; orb.by a decree or order from which no appeal is allowed by this Act, may apply for a review of judgment to the court which passed the decree or made the order, and the court may make such order thereon as it thinks fit.

8. The procedural provisions for review under Order 45 rule 1 of the Civil Procedure Rules provide that: -(1)Any person considering himself aggrieved—(a)by a decree or order from which an appeal is allowed, but from which no appeal has been preferred; or(b)by a decree or order from which no appeal is hereby allowed, and who from the discovery of new and important matter or evidence which, after the exercise of due diligence, was not within his knowledge or could not be produced by him at the time when the decree was passed or the order made, or on account of some mistake or error apparent on the face of the record, or for any other sufficient reason, desires to obtain a review of the decree or order, may apply for a review of judgment to the court which passed the decree or made the order without unreasonable delay.

9. The Court of Appeal in Anthony Gachara Ayub v Francis Mahinda Thinwa [2014] eKLR restated the main grounds for review which are discovery of new and important matter or evidence; mistake or error apparent on the face of the record; or for any other sufficient reason and most importantly, the application has to be made without unreasonable delay.

10. By this court’s ruling dated 27th October, 2022, this court found that the 3rd Applicants did not have capacity to sue for want of letters of administration to represent Mugambi Nkiruta. There is no dispute that they obtained letters of administration long after this suit was filed. The suit in Nkubu was also withdrawn after 27th October, 2022. Flowing from the above, the defect in the capacity to sue by the 3rd Applicants cannot be cured by an amendment to include the 3rd Applicants but by filing a fresh suit at a date after the letters of administration ad-litem were issued. However, the suit by the 1st and 2nd Respondent is still valid.

11. I have considered the application and the Applicants have not demonstrated discovery of new and important matter or evidence which, after the exercise of due diligence, was not within his knowledge or could not be produced by Applicants at the time when the ruling in issue was delivered, or some mistake or error apparent on the face of the record, or any any other sufficient reason for lifting, setting aside and or vacating orders 4 and 5 of the ruling dated 27th October, 2022.

12. Consequently, the notice of motion dated 02nd November, 2022 is allowed in the following terms:1. Application to lift, set aside and or vacate orders 4 and 5 of the ruling dated 27th October, 2022 pending the hearing and determination of the derivative suit is declined2. Except for inclusion of the 3rd Applicants, the 1st and 2nd Applicants are at liberty to amend the plaint as they deem necessary3. The amended plaint shall be filed and served within 21 days from toady’s date4. Respondents shall file their defence within 14 days of service of the Amended Plaint5. 3rd Respondents shall bear the costs of this application6. This matter will be mentioned on 30th March, 2023 to confirm compliance with these orders and for further orders

DELIVERED THIS 09th DAY OF February 2023WAMAE. T. W. CHEREREJUDGEAppearancesCourt Assistant - KinotiFor Applicants - Mr. Mwiti for Joshua Mwiti & Co. AdvocatesFor Respondent - Mr. Muriira for Mwenda, Mwarania,Akwalu & Co. Advocates