Sarah Kathure v Nissi Civil Engineering & Building Contractors Co. Ltd, Jepither Gitonga Mauta & Jediel Mutura Mauta [2020] KEHC 1063 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA

AT MERU

MISC CIVIL APPLICATION NO. 46 OF 2020

IN THE MATTER OF THE COMPANIES ACT, 2015

SARAH KATHURE......................................................................................................RESPONDENT

-VERSUS-

NISSI CIVIL ENGINEERING & BUILDING CONTRACTORS CO. LTD...... 1ST APPLICANT

JEPITHER GITONGA MAUTA..............................................................................2ND APPLICANT

JEDIEL MUTURA MAUTA.....................................................................................3RD APPLICANT

R U L I N G

1. This is a ruling on the 2nd and 3rd applicant’s Motion dated 16/07/2020 brought under Article 47 and 50 of the Constitution of Kenya, Order 1 Rule 3 and Order 45 Rule 1 and 2 of the Civil Procedure Rules 2010.

2. In the Motion, the 2nd and 3rd applicant sought the review of the ruling of this Court made on 4/6/2020 on the basis that their replying affidavit and submissions, dated 21/05/2020 were duly filed in court on 21/05/2020. Further that, in its ruling dated 4/6/2020, the court erroneously indicated that they had not responded to the respondent’s application dated 28/4/2020 and thereby allowed that application without considering the applicant’s aforesaid response and submissions.

3. The grounds upon which the application was made were set out in its body and the supporting affidavit of Jephither Gitonga Mauta sworn on 16/07/2020. It was contended that when the 2nd and 3rd applicants sought an extension to respond to the respondent’s application dated 28/04/2020, the same was granted whereby they duly filed the same together with the submissions on 21/05/2020.

4. That however, the ruling made on 4/06/2020 erroneously observed that the 2nd and 3rd applicant had not filed the same. In the premises, the said applicants were condemned unheard thereby amounting to an error on the face of the record.

5. The application was opposed vide the replying affidavit of Sarah Kathure sworn on 25/09/2020. She deponed that she was granted leave by this court vide its ruling of 4/06/2020 to file a derivative suit to protect their company, the 1st applicant. This led to her filing the Meru High Court Civil Suit No. 9 of 2020 on 11/06/2020. That the applicants should strive to file a defence to the said suit as opposed to filing the instant application which is not meritorious to enable expeditious determination the same.

6. In the case of J M K v M W M & another [2015] Eklr, the Court of Appeal held: -

“The courts of this land have been consistent on the importance of observing the rules of natural justice and in particular hearing a person who is likely to be adversely affected by a decision before the decision is made. In ONYANGO V. ATTORNEY GENERAL(1986-1989) EA 456,Nyarangi, JA asserted at page 459:

“I would say that the principle of natural justice applies where ordinary people who would reasonably expect those making decisions which will affect others to act fairly.”

Atpage 460 the learned judge added:

“A decision in breach of the rules of natural justice is not cured by holding that the decision would otherwise have been right. If the principle of natural justice is violated, it matters not that the same decision would have been arrived at.”

And in MBAKI & OTHERS V. MACHARIA & ANOTHER(2005) 2 EA 206, at page 210, this Court stated as follows:

“The right to be heard is a valued right. It would offend all notions of justice if the rights of a party were to be prejudiced or affected without the party being afforded an opportunity to be heard.”

7. Rules of natural justice require that a person who is going to be affected by a decision be given an opportunity to be heard. This right is enshrined in our Constitution which is the supreme law of the land. Similarly, the Civil Procedure Act which governs civil proceedings has the overriding objective to facilitate the just, expeditious, proportionate and affordable resolution of the civil disputes as stipulated under Section 1A of the Act. Thus, denying a person an opportunity to be heard would not be just neither would it be proportionate.

8. On the annextures “JGM1”, “JGM2” and “JGM3” it is clear that the applicants filed their affidavits and submissions on time and they should have been considered in the ruling of 4/6/2020 the said 21/05/2020. On that basis, I allow the application and proceed to consider the said replying affidavit and submissions.

9. In the replying affidavit of Jephipher Gitonga Mauta,it was deposed that; the respondent was extending her matrimonial differences with her erstwhile husband, the 3rd applicant, to the Company; that she is a litigious person who had been involved in criminal activities against the applicants and had been reported to the Department of Criminal Investigations. That any monies that was being withdrawn from the Company is accounted for at the AGM. In the premises, her application should be dismissed.

10. I have also considered the applicants’ submissions and the authority referred to therein. The same buttresses the depositions in the replying affidavit on the conduct of the respondent.

11. I note that the applicants’ depositions were that there are serious differences in the Company. They never denied that they are now operating the Company, including withdrawal of funds, to the exclusion of the respondent. Their answer was that the withdrawn funds will or are accounted during the AGM. There was no evidence of any such accounts having been presented at an AGM or the respondent having been notified of the same.

12. The view I take is that, there is evidence which is buttressed by the applicants’ themselves, that there is a prima facie case that has been established for the commencement of the derivative suit.

13. Accordingly, I allow the application to the extent that I have considered the replying affidavit and the submissions of the 2nd and 3rd applicants. However, having considered the same, I dismiss the prayer for the review of the ruling of 4/6/2020.

14. In the circumstances of this case, I order each party to bear own costs.

SIGNEDat Nairobi.

A. MABEYA, FCIArb

JUDGE

DATEDand DELIVEREDat Meru this 10th day of December, 2020.

JUDGE