RULING
1. Before the Court is the Applicant’s Notice of Motion dated 21st July 2025, brought pursuant to Sections 878, 885 and 888 of the Companies Act, No. 17 of 2015, and Order 51 Rule 1 of the Civil Procedure Rules, 2010, seeking the following orders:
(a) Spent.
(b) THAT the time for registration of the Legal Charge dated 27 May 2025 at the Companies Registry be extended by a further period of 30 days.
(c) THAT there be no order as to costs.
2. The Application is supported by the affidavit of Janjo David Gideon, an Advocate of the High Court of Kenya practicing in the firm of Messrs. Madhani Advocates LLP, the advocates on record for the Applicant. The said affidavit was duly sworn on 21st July 2025.
Issues For Determination
3. The Court has carefully considered the Motion, the statutory provisions cited, the supporting affidavit, and the annexures thereto. Upon such consideration, the Court is of the view that only one issue arises for determination:
(a) Whether leave should be granted to the Applicant to register the Legal Charge dated 27th May 2025 at the Companies Registry out of time.
Analysis
4. Pursuant to Section 884 of the Companies Act, the Registrar of Companies is mandated to maintain a register of charges, register such charges, issue certificates of registration thereof, and authenticate the same with the Registrar’s Official Seal. Under Section 885 of the Act, the statutory timeline for registration of a charge is thirty (30) days from the date of its creation. In the event of non-compliance, Section 888(1) of the Companies Act empowers any interested party or the company itself to apply to the Court for an extension of the prescribed period for registration.
5. Further, when considering an extension under Section 888, the Court examines whether the delay was accidental or reasonably explained, whether it prejudiced creditors or members, whether granting the extension is just and fair, and whether the omission is rectifiable
6. This requirement that such a charge must be registered with the Registrar of Companies within thirty (30) days from the date of its creation is statutory and not discretionary. It is evident that the parties have complied with all the necessary legal requirements in the creation of the charge, save for the registration, which was delayed due to reasons sufficiently explained and which were beyond their control.
7. Counsel for the Applicant submitted that pursuant to a Letter of Offer dated 6th March 2025, the Applicant (hereinafter “the Bank”) extended a financial facility in the sum of Kshs.253,000,000.00 to New Paleah Millers Limited (hereinafter “the Borrower”). The facility was to be secured by a legal charge over all that property known as Title Number MBEERE/WACHORO/1371 and Title Number MBEERE/WACHORO/1372. The Bank’s advocates on record subsequently prepared a Legal Charge dated 27th May 2025, which was duly executed by all the parties. Thereafter, stamp duty was assessed and paid on 5th June 2025. In accordance with Section 885 of the Companies Act, No. 17 of 2015, the Charge ought to have been registered at the Companies Registry within 30 days from its creation, that is, on or before 5th July 2025. However, the Charge was not registered within the prescribed period, as the Applicant received the requisite funds to facilitate the registration from the Chargor only after the lapse of the 30-day statutory period.
8. The process of perfection was actively pursued within time. This delay was thus not due to negligence or omission on the part of the Applicant or its advocates, but rather due to reliance on a third party (the Chargor), a common practical difficulty in perfection of securities. The Applicant filed the application soon after the lapse, showing diligence and intention to regularize the position promptly. All taken together, this court finds that the explanation provided is sufficient and reasonable in law. The purpose of registering a charge is to safeguard the chargee’s and creditors’ interests. While failure to register can undermine the chargee’s rights, inadvertent procedural delays should not invalidate an otherwise valid charge, in line with Article 159 of the Constitution and the Companies Act, which promote substantive justice over technicalities.
9. In view of the foregoing, it would be just, fair, and equitable that the omission should not be visited upon the Chargee, who stand to suffer substantial prejudice if the Charge is not protected seeing it is one that is capable of being remedied through the grant of an extension of time to enable the registration at the Companies Registry in accordance with the provisions of the Companies Act. Accordingly, the prayers sought in the Notice of Motion dated 21st July 2025 are hereby granted.
Determination
10. The time within which to register the Charge dated 27th May 2025, over ALL THAT property known as TITLE NUMBER: MBEERE/WACHORO/1371 and TITLE NUMBER MBEERE/WACHORO/1372 in favour of the DIAMOND TRUST BANK KENYA by ATLANTIS CONCRETE LIMITED, with the Registrar of Companies, is hereby extended by a period of thirty (30) days from the date of this Ruling.
11. It is further ordered that upon registration of the said charge within the extended period, the charge shall be deemed to have been duly filed with the Registrar of Companies in full compliance with the Companies Act, 2015.
12. Given the nature of the application, there shall be no order as to costs.
13. It is so ordered.
14. The file is hereby closed.
DATED, SIGNED AND DELIVERED AT MILIMANI THIS 31ST DAY OF JULY 2025.
NJOROGE BENJAMIN K.
JUDGE
In the presence of;
Mr Muriungi for the Applicants
Mr. Amos – Court Assistant
1. Before the Court is the Applicant’s Notice of Motion dated 21st July 2025, brought pursuant to Sections 878, 885 and 888 of the Companies Act, No. 17 of 2015, and Order 51 Rule 1 of the Civil Procedure Rules, 2010, seeking the following orders:
(a) Spent.
(b) THAT the time for registration of the Legal Charge dated 27 May 2025 at the Companies Registry be extended by a further period of 30 days.
(c) THAT there be no order as to costs.
2. The Application is supported by the affidavit of Janjo David Gideon, an Advocate of the High Court of Kenya practicing in the firm of Messrs. Madhani Advocates LLP, the advocates on record for the Applicant. The said affidavit was duly sworn on 21st July 2025.
Issues For Determination
3. The Court has carefully considered the Motion, the statutory provisions cited, the supporting affidavit, and the annexures thereto. Upon such consideration, the Court is of the view that only one issue arises for determination:
(a) Whether leave should be granted to the Applicant to register the Legal Charge dated 27th May 2025 at the Companies Registry out of time.
Analysis
4. Pursuant to Section 884 of the Companies Act, the Registrar of Companies is mandated to maintain a register of charges, register such charges, issue certificates of registration thereof, and authenticate the same with the Registrar’s Official Seal. Under Section 885 of the Act, the statutory timeline for registration of a charge is thirty (30) days from the date of its creation. In the event of non-compliance, Section 888(1) of the Companies Act empowers any interested party or the company itself to apply to the Court for an extension of the prescribed period for registration.
5. Further, when considering an extension under Section 888, the Court examines whether the delay was accidental or reasonably explained, whether it prejudiced creditors or members, whether granting the extension is just and fair, and whether the omission is rectifiable
6. This requirement that such a charge must be registered with the Registrar of Companies within thirty (30) days from the date of its creation is statutory and not discretionary. It is evident that the parties have complied with all the necessary legal requirements in the creation of the charge, save for the registration, which was delayed due to reasons sufficiently explained and which were beyond their control.
7. Counsel for the Applicant submitted that pursuant to a Letter of Offer dated 6th March 2025, the Applicant (hereinafter “the Bank”) extended a financial facility in the sum of Kshs.253,000,000.00 to New Paleah Millers Limited (hereinafter “the Borrower”). The facility was to be secured by a legal charge over all that property known as Title Number MBEERE/WACHORO/1371 and Title Number MBEERE/WACHORO/1372. The Bank’s advocates on record subsequently prepared a Legal Charge dated 27th May 2025, which was duly executed by all the parties. Thereafter, stamp duty was assessed and paid on 5th June 2025. In accordance with Section 885 of the Companies Act, No. 17 of 2015, the Charge ought to have been registered at the Companies Registry within 30 days from its creation, that is, on or before 5th July 2025. However, the Charge was not registered within the prescribed period, as the Applicant received the requisite funds to facilitate the registration from the Chargor only after the lapse of the 30-day statutory period.
8. The process of perfection was actively pursued within time. This delay was thus not due to negligence or omission on the part of the Applicant or its advocates, but rather due to reliance on a third party (the Chargor), a common practical difficulty in perfection of securities. The Applicant filed the application soon after the lapse, showing diligence and intention to regularize the position promptly. All taken together, this court finds that the explanation provided is sufficient and reasonable in law. The purpose of registering a charge is to safeguard the chargee’s and creditors’ interests. While failure to register can undermine the chargee’s rights, inadvertent procedural delays should not invalidate an otherwise valid charge, in line with Article 159 of the Constitution and the Companies Act, which promote substantive justice over technicalities.
9. In view of the foregoing, it would be just, fair, and equitable that the omission should not be visited upon the Chargee, who stand to suffer substantial prejudice if the Charge is not protected seeing it is one that is capable of being remedied through the grant of an extension of time to enable the registration at the Companies Registry in accordance with the provisions of the Companies Act. Accordingly, the prayers sought in the Notice of Motion dated 21st July 2025 are hereby granted.
Determination
10. The time within which to register the Charge dated 27th May 2025, over ALL THAT property known as TITLE NUMBER: MBEERE/WACHORO/1371 and TITLE NUMBER MBEERE/WACHORO/1372 in favour of the DIAMOND TRUST BANK KENYA by ATLANTIS CONCRETE LIMITED, with the Registrar of Companies, is hereby extended by a period of thirty (30) days from the date of this Ruling.
11. It is further ordered that upon registration of the said charge within the extended period, the charge shall be deemed to have been duly filed with the Registrar of Companies in full compliance with the Companies Act, 2015.
12. Given the nature of the application, there shall be no order as to costs.
13. It is so ordered.
14. The file is hereby closed.
DATED, SIGNED AND DELIVERED AT MILIMANI THIS 31ST DAY OF JULY 2025.
NJOROGE BENJAMIN K.
JUDGE
In the presence of;
Mr Muriungi for the Applicants
Mr. Amos – Court Assistant