Introduction
1. The Petition dated 3/6/2024 is supported by the Supporting affidavit of the Petitioner, ISAAC SILA of similar date, his further and supplementary affidavits sworn on 20/2/2025 and 26/3/2025 respectively.
2. In opposition, the Respondent (a limited liability company) and, the 1 st and 2 nd Interested Party, all represented by Adra Advocates LLP filed Grounds of Opposition dated 20/11/2024 and a Replying affidavit of even date.
3. The Petitioner challenges the decision of the Respondent’s Board of Directors to disqualify him from participating in the election of the Respondent’s Board of Directors which were scheduled to be held on 20/4/2024 to replace two directors who were retiring on the grounds that vetting and nomination criteria applied by the Respondent not only contravened express constitutional and legal requirements, but was also neither provided for nor envisaged by the Respondent’s Articles of Association that governs election of directors. The core of the Petition is that the Respondent failed give him notice of the allegations made against him or afford him an opportunity to be heard before disqualifying him from the elections.
4. The Petitioner thus seeks the following reliefs:
i. A Declaration that the Respondent’s action of disqualifying the Petitioner from presenting himself as a candidate for elections of Director of the Respondent held on 20th April 2024 was a violation of Article 47 of the Constitution hence null and void.
ii. A Declaration that the Respondents action of disqualifying the Petitioner from presenting himself as a candidate for the elections of Director of the Respondents held on 20th April, 2024 was a violation of Article 36 of the Constitution hence null and void.
iii. As a consequence of Prayer (i) & (ii) the elections of the Respondents elections of Directors held on 28th April, 2024 are hereby declared null and void.
iv. Costs.
v. Any other relief this Court may deem fit and just to grant.
PETITIONER’S CASE
5. The Petitioner deposed that he is a member and shareholder of the Respondent. He deponed that Clause 83 of the Respondents Articles of Association provides that the Election of Directors will be held after every year during an Annual General meeting. However, shareholders in a properly Constituted General meeting can shorten or lengthen the tenure of a director if the need arises as long as the reasons for shortening or lengthening the tenure of a Director for Two (2) years be explained in the General meeting and supported by a simple majority in the meeting.
6. He averred that Clause 84 of the Respondents Articles of Association provides that the candidate for elections of Director should be proposed and seconded by shareholders of the company while Clause 86 provides that elections shall be by a show of hands and the candidates with the highest number of votes will be considered the winner.
7. He contended that the Respondents Articles of Association do not contain any provision for vetting of candidates. He exhibited a copy of the Memorandum and Articles of Association of the Respondent "IS1" to buttress this position.
8. He further deponed that the Respondent sent a notice ( exhibit IS 2 ) to all its shareholders informing them that two (2) Board of Directors positions would fall vacant in the upcoming 13th Annual General meeting (AGM) to be held on 20th April 2024 and that these vacancies were to be filled in the same meeting and thus invited applications from Interested and qualified candidates from shareholders to express Interest and get an opportunity to “nominated" as a Board member.
9. The Petitioner stated that the Notice specified that the candidates were required to undergo a nomination to be selected as members of the Board as it was the Respondents Board Policy to balance the skills and experiences of her directors considering special requirements of the company. Further, the Notice specified the Academic qualifications and personal qualities for the candidates.
10. The Petitioner stated that submitted his application ( annexure ‘IS3’ ) for the position of Director on 12th March, 2024.
11. He deponed that on 9th April 2024, he received a letter ( annexure ‘IS4’ ) from Lumallas Achieng' & Kavere Advocates on behalf of the Respondent informing him that he had been disqualified from presenting himself as a candidate for elections as a director for the following reasons;
a. An internal audit report on the Ngelani Project, alleging that certain transactions transpired during my tenure and under my advisement.
b. That the Board was still investigating policy and prudence lapses in the project and intended to sanction those found culpable.
c. That my continued presence on the Board during investigations posed a conflict of interest.
12. The Petitioner explained that he responded through a letter from his Advocates dated 11 th April 2024 ( annexure 5 ) indicating that he was neither served nor aware of the alleged audit report and asked for an opportunity to defend himself. He stated that no opportunity was accorded to him in that regard. He swore he was never issued with any show cause letter prior to this communication.
13. The Petitioner averred that on 20 th April 2024, the Respondent held its Annual General meeting in which Item 6 of the agenda (annexure IS 6) was the retirement and Election of Directors that stated as follows:
i) "Mr. Simon Mburu retires by rotation in accordance with
Articles 72 and 105 of the Company’s Articles of Association
and being eligible offers himself for re-election.
ii. Mr. Patrick Alubee retires by rotation in accordance with
Article 72 and 105 of the Company's Articles of Association.
iii. Mr. Chris Miyinzi Mwingu offers himself for election as Director of the Company."
14. The Petitioner contends that the Respondents action of purporting to conduct a vetting of the Petitioner’s application to be presented as a candidate for elections as Director without giving the Petitioner a chance to participate in the vetting process is a violation make of the Petitioners Constitutional Right to Fair Administrative Action under Article 47 of the Constitution. He further goes on to protest that the decision to disqualify the Petitioner from participating in the elections of Director of the Respondent on 28th April, 2024 is a violation of the Petitioners Constitutional rights under Article 47 and 36 of the Constitution.
15. The Petitioner addressing the assertion in the Respondent’s response that this is a mere commercial dispute requiring this Court invoke the doctrine of constitutional avoidance refuted the position taken by the Respondent.
16. He contended that the Board of Directors Charter, which provides for ‘Nomination Committee’ also makes reference under annexure 1 thereof to the Capital Markets Authority Guidelines on Corporate Governance - Gazette Notice 3362,and provides among others, that the functions of this Committee include conducting a formal, and transparent procedure in nomination of Directors of the Board ( annexure ‘IS 1 & 2’ of the Petitioner’s Further affidavit ).
17. He deposed that at the time of his disqualification, no determination of any wrongdoing had been made against him and the Respondent failed to establish any direct or clear conflict of interest to justify his disqualification under clause 2.1.5 of the Capital Markets Authority Guidelines and thus maintained the decision to bar him was arbitrary and a violation of Article 27 that guarantees him equal benefit and protection of the law.
18. He further asserted disqualification violated his human dignity under Article 28 as it was based on unverified audit report coupled with refusal to affording him an opportunity to be heard, thereby depriving him the dignity of a fair process.
19. He thus maintained that there is clear evidence of violation of his constitutionally guaranteed rights that properly fall within the exercise of this Court’s jurisdiction under Article 22, 23 and 165 (3) (b) of the Constitution.
20. The Petitioner explained that he worked as the Operations officer of the 1 st Respondent and his job description entailed identification of potential land for acquisition as the Respondent's primary business was the acquisition and sale of land for profit.
21. He clarified that after identification of the property, would then prepare a project proposal to the General Manager for approval and presentation to the Investment and Business Development Committee of the Respondent Board of Directors after which the Investment and Business Development Committee (lBDC) would conduct due diligence including visiting the property, meeting the seller, negotiating the prices and once satisfied, table the report to the full Board of Directors for approval
22. He disclosed that the Board of Directors of the Respondent would then approve the IBDC report and the property would be purchased.
23. He stated this procedure actually complied with in relation to Ngelani project as well as all other projects of the Respondent as the it was procedurally approved and oversighted by the Respondent's General Manager, IBDC and Board of Directors as per the procedures of the Respondent.
24. He contended that it was unprocedural that the same Board of Directors that approved the project that investigating that very project and further that, the Respondent's Board of Directors was never disqualified from their positions as directors pending the alleged investigations into the project.
25. He deposed that he was the only one who was affected by the al1eged investigations into the Ngelani project without any communication from the Respondent or documentation to supporting the alleged audit.
26. The Petitioner stated that he handled over 25 projects during his tenure as the Operations Officer of the Respondent without any allegations of impropriety, including the Ngelani Project, ever being made against him.
27. He thus maintained that the decision to clandestinely disqualify him from vying for the directorship was unsubstantiated, unprocedural and a violation of his right to a fair hearing and an attack to his integrity
28. He deponed that the Respondent has now changed tact and has withdrawn the allegations against him, in that on 21 st March 2025, ( annexure ‘IS 3’ of the Supplementary affidavit) he received an email from the Respondent together with a letter stating as follows:
"Please note that the investigation into the acquisition of L.R No. 8914/ 208 Ngelani ('the Property'} is now complete. The Board has resolved not to pursue any further action."
29. He asserted that the Respondent’s Board's resolution to take no further action confirms that there was no wrongdoing on his part, and therefore, the disqualification from participating in the said elections was malicious, unlawful and unconstitutional as it did not only adhere to the Articles and Memorandum of Association of the Respondent but also the Capital Markets Authority Guidelines on Corporate Governance and the Constitution.
30. He states that following the unfair disqualification, he has suffered mental anguish arising from public humiliation and reputational damage caused by the baseless allegations, unwarranted legal costs, defending himself against unsubstantiated claims, the loss of opportunity to serve as a Director of the Respondent and constitutional violations already alluded to in this Petition.
RESPONDENT AND THE 1 ST AND 2 ND INTERESTED PARTIES’ CASE
31. In response to the Petition, the Respondent and the 1 st and 2 nd Interested Parties filed grounds of Opposition dated 20/11/2024 and the Replying affidavit of even date.
32. The Grounds of Opposition were as follows:
1. The Petition offends the doctrine of Constitutional Avoidance which espouses that a court will not determine a constitutional issue when a matter may be properly decided on another basis.
2. The Petition discloses nothing more but a pure commercial dispute pertaining to the Respondent’s internal affairs and in particular, the Respondent’s vetting process.
3. The Respondent’s internal affairs are governed by the provisions of the Company’s Act No. 7 of 2015 and the Respondent’s articles of association.
4. The Respondent’s articles of association are a binding contract between the Respondent and all its shareholders, and any claim should be brought under the principles of contract law.
5. The Petition does not raise constitutional questions, rather it is a commercial dispute that can be properly decided by way of an ordinary plaint.
6. The Honourable Court therefore lacks the jurisdiction to determine the Petition.
7. The Petition is frivolous, vexatious and an abuse of the Honourable Courts time and process and ought to be struck out with costs to the Respondent and the 1st and 2 nd Interested Parties.
33. The replying affidavit of the Respondent was sworn by CAREN KUTTO, the Administration and Digital Marketing Officer of Kimisitu Investment Company PLC (the Respondent).
34. She restated that the Petition discloses nothing more but a pure commercial dispute pertaining to the Respondent’s internal affairs and in particular-the Respondent’s vetting process hence the Petition offends the doctrine of constitutional avoidance.
35. The Respondent confirmed that it notified its shareholders that two Board of Directors Positions were to fall vacant in the Annual General meeting that was to be held on 20 April 2024 and invited any interested and qualified candidates to express interest and get an opportunity to be nominated as a board member ( per exhibit CK 1 ), which disclosed the criteria with which all the candidates were to be subjected to and included- academic and professional qualifications as well as personal qualities which included inter alia, that the Candidate had to meet the requirements of Chapter six of the Constitution.
36. The deponent went further to state that following the notification of vacancy, the Petitioner submitted his application dated 12 March 2024 for consideration and nomination for the position of Director (CK 2).
37. The Respondent notes that, from the Petitioner’s own application document, the Petitioner was fully aware that all applicants had to undergo nomination and vetting process based on disclosed criteria in the vacancy notice, prior to presentation to shareholders elections. She stated:
“… From the Petitioner’s application, he understood that all the applicants had to go through a nomination and vetting process against the criteria disclosed in the vacancy notice prior to their presentation to shareholders for Director’s election. In his application he wrote:
“Thanking you in advance and hoping to be given an opportunity to present myself to the shareholders during the forth-coming AGM…”
38. The Respondent confirmed that the process of appointment of Directors at the Respondent company is well laid out under Clause 83 of the Respondent’s Article of Association dated 4 August 2010 ( exhibit CK 3 ) which provides inter alia:
“83. The Election of Directors will be held after every year during an Annual General Meeting (AGM) but the Shareholders in a properly constituted General Meeting can shorten or lengthen the tenure of a director if the need arises. Reasons for shortening or lengthening the tenure of a director from two years must be explained in the General Meeting and supported by a simple majority in the meeting.”
39. The Respondent however noted that the Petitioner had failed to disclose that the process of appointment of Directors is also laid out in the Respondent’s Board of Directors Charter (the Charter) - exhibit CK 4 where under chapter 2 of the Charter- clause 2.4 that provides:
“2.4 There shall be clear formal and transparent procedure for nomination and appointment of new Directors to the Board . In this regard, the Board shall:
all Directors will be required to submit themselves for election by shareholders by rotation periodically, but in any event within a period not exceeding two years.”
40. The deponent further disclosed that the Notice of Director’s vacancy by the Respondent made reference to the Respondent’s Board Charter and informed the shareholders that all candidates were to undergo a nomination and election process to be selected as members of the board as follows:
“The candidates will go through nomination and election process to be selected as members of the Board, it is the Kimisitu Board Policy to balance the skills and experiences of her directors yet considering unique or special requirements of the company.”
41. Moreover, the Respondent went on to state the chapter four of the ‘The Charter’ provides for the Roles and Functions of the Board which include inter alia:
‘4.1.3 (b) Ensure that, through a managed and effective process, Board
appointments are made that provide a mix of proficient Directors, each of whom is able to add value and bring independent judgment to bear on the decision-making process.’
42. The Respondent deposed that ‘ The Charter’ , under chapter eleven , provides for Board Committees and their terms of reference. The Charter provides for a minimum of five standing committees of the Board, with one of the Committees being the Nomination Committee .
43. The Respondent pointed out that annexure 1 of the Charter , subscribes to the Capital Markets Authority Guidelines on Corporate Governance Gazette Notice No. 3362 . (the Guidelines). These Guidelines under clause 2.1.5 provide for the appointments to the Board as follows:
“There should be a formal and transparent procedure in the appointment of Directors to the Board and all persons offering themselves for appointments, as Directors should disclose any potential area of conflict that may undermine their position or service as Director.”
44. She went further to cite Clause 3.1.3 which provide for the appointment of a nominating Committee with the responsibility of proposing new nominees for the Board as well as assessing the performance and effectiveness of Directors of the company, and further provide the responsibilities of the nomination committee which includes inter alia that:
“c. The nomination committee shall consider only persons of calibre, credibility and who have the necessary skills and expertise to exercise independent judgment on issues that are necessary to promote the company’s objectives and performance in its area of business.”
45. The Respondent maintained that it was based on all the foregoing provisions that the Respondent’s nominating committee, upon receipt of the applications, vetted all the applications against the disclosed criteria and based on the findings of the vetting process, determined that it would not proceed with the Petitioner’s application and the Petitioner was informed of the decision of the Nomination Committee through a a letter dated 9 th April 2024 ( exhibit CK 5 ) from its then Advocates, Lumallas Achieng & Kavere Advocates which stated inter alia as follows:
a. “The internal Audit Report on the Ngelani Project reveals that the transaction under review transpired during your tenure and under your advisement on some aspects.
b. That the company is investigating related lapses in policy and prudence and may propose sanctions against those found culpable for the financial loss occasioned by the project.
c. That your being on the Board during the said investigations poses a conflict of interest.”
53. The deponent disclosed that the Petitioner in his application for the Director’s post, indicated as part of his experience that he worked as an Operations Officer for the Respondent from 2011 to March 2020 and his duties included pension matters, shares registration and company secretarial, finance, accounts, human resource and administration, sales and marketing, real estate, public relations, investment and portfolio management, legal and customer service. Further, in his performance review of 2016, he had indicated that he was involved in the Ngelani Land project which did not perform well.
46. The Respondent had also issued the Petitioner with a letter indicating its concern over his performance in 2017 ( see exhibits CK 6 & 7 ).
47. The Respondent deposed that due to the poor performance of the Ngelani project, which was admitted by the Petitioner, the Respondent tasked its internal auditor to audit the project and share its findings as part of its investigations to determine the reasons for the poor performance.
48. The Respondent explained that due to the pending investigations and the potential conflict of interest that the Petitioner’s election as Director would have posed to the investigations, the nominating Committee, in performing its role to promote the independent judgment of all nominated candidates, decided not to proceed with the Petitioner’s candidacy. The Respondent averred that the Nominating Committee’s decision not to proceed with the Petitioner’s application was thus communicated to him with the reasons given for the decision and advising the Petitioner that it would be prudent to await the outcome of the ongoing investigations and be cleared first prior to offering himself for the election in the best interest of the Company.
49. The Respondent stated that upon conclusion of the nomination and vetting process, the Respondent presented the 1st and 2nd Interested Parties to the Shareholders during the Annual General Meeting held on 20 April 2024, to be elected as Shareholders. The details of the new directors were forwarded to the Registrar of Companies and the register was updated accordingly ( per CR 12- exhibit CK 8 ).
50. The Respondent reiterated and affirmed that it duly complied with the processes provided in its own internal documents that govern the elections of its Board of Directors, namely: the Articles of Association, the Board Charter and the Guidelines by the Capital Markets Authority in arriving at the decision to bar the Petitioner, in that:
a. It invited its shareholders to apply for the vacant position of Director of the Company and set out the qualifications required on the notice.
b. The Board of Directors constituted a nominating Committee as per the Charter, with powers to determine the appointment criteria which was made known to all applicants and against which all applicants were assessed.
c. After the assessment, the Petitioner was informed of the committee’s decision and the reasons for the decision.
d. There was a clear formal and transparent procedure for the nomination and appointment of the Directors and all the applicants were aware of the procedure.
51. The Respondent thus refuted the Petitioner’s contention that the Respondent violated his Right to fair administrative action and freedom of association terming the allegation false in the light of the fact that the Petitioner was given a chance to tender his application, and the nomination and vetting process was clear and transparent, and the Respondent adhered to it. The Respondent clarified that the decision by the Respondent does not Bar the Petitioner from participating in future elections of Directors, after the outcome of the investigations, cleared him.
52. The Respondent deposed that the Petitioner on 22/4/2024, and prior to filing the instant Petition, the filed a Judicial Review division Review Application, ( exhibit CK 9), seeking to quash the Respondent’s decision not to proceed with the Petitioner's application. The Respondent thus accuses the Petitioner of forum shopping contending that the Petitioner has deliberately avoided the appropriate avenue of settling disputes of this nature, which is by filing a plaint as the alleged grievances are founded on the law of contract.
PETITIONER'S SUBMISSIONS
53. The Petitioner filed written submissions dated 12/5/2025 through Miller & Company Advocates. This Petitioned contended the decision to disqualify him from vying for election as a Director of the Respondent during its Annual General Meeting held on 20 th April 2024 was arrived arbitrarily, without lawful justification, and in a manner that violated the Petitioner's constitutional rights, including the right to fair administrative action, equality and freedom from discrimination, human dignity, and freedom of association.
54. Counsel reiterated the fact that the Petitioner is a shareholder and member of the Respondent, a public company registered under the Companies Act, 2015 whose affairs are governed by its Articles of Association subject to oversight by shareholders through annual general meetings and directorial elections.
55. He submitted that through a notice to all its shareholders, the Respondent notified that two Board or Directors positions would be falling vacant and invited interested and qualified shareholders to submit their nominations for election to the Board of Directors during its Annual General Meeting scheduled for 20 th April 2024. The Petitioner, being qualified and interested, he submitted his nomination in accordance with the stipulated timelines.
56. However, on 9 th April 2024, the Petitioner was informed by a letter on behalf of the Respondent that his candidature had been disqualified by the "vetting committee," purportedly due to ab adverse mention in the "Ngelani Project Report'' which despite multiple requests, the Petitioner was not furnished with or any formal communication detailing the grounds of disqualification conveyed.
57. Further, that no hearing was conducted thus the Petitioner was denied a fair opportunity to be heard, contrary to the dictates of Article 47 of the Constitution. In addition, that process was overseen and influenced by individuals with personal stakes in the outcome of the election, including the Interested Parties who were candidates in the election.
58. Counsel submitted that the nomination and vetting process that led to the disqualification of the Petitioner had no legal foundation both under the Respondent's Articles of Association, the Companies Act, or Regulatory framework. He argued that the Articles of Association (Clauses 83-86) do make any provision for disqualification of candidates prior to the AGM, which vest the electoral power solely on the shareholders hence in purporting to bar the Petitioner from the elections, the Respondent acted ultra vires its Articles and violated the principles of good corporate governance and constitutionalism under Article 10 of the Constitution.
59. Counsel submitted that the Petitioner was selectively and discriminatorily targeted, in that, other individuals similarly alleged to have been involved in the Ngelani Project, comprised the current board members who were permitted to contest the elections without any vetting thus the Petitioner's constitutional right to equality under Article 27, dignity under Article 28, and freedom of association under Article 36 were violated. Counsel submitted that the process to lock the Petitioner out of the election involved his direct competitors, namely, the 1st and 2nd Interested Parties, hence, creating a clear conflict of interest that rendered the process biased, unreasonable, and procedurally unfair.
60. The Petitioner submitted that the culmination of this unlawful and unconstitutional process was the conduct of the Respondent's election of Directors on 28 th April 2024 where the Petitioner was excluded from participation.
61. The Petitioner further argued that the decision to bar him from contesting in the elections was based on vague and unproven allegations connected to the so called "Ngelani Project Report," which he had neither seen nor had he been afforded an opportunity to respond.
62. Counsel submitted that on 21st March 2025, the 1st Respondent issued a letter to the Petitioner exonerating him from any wrongdoing in relation to the ‘Ngelani Project’ which he argued confirmed that the allegations underpinning the disqualification were baseless, and so was the process leading to the exclusion was factually and legally unfounded and a grave abuse of power and breach or procedural fairness.
63. Counsel further isolated and explicated the following specific issues:
i) Whether the disqualification of the Petitioner was in violation of his right to fair administrative action under Article 47 of the Constitution?
ii) Whether the disqualification of the Petitioner was discriminatory and in contravention of Articles 27 and 28 of the Constitution?
iii) Whether the Respondents acted ultra vires in disqualifying the Petitioner'?
iv) Whether the election held on 28 th April 2024 is null and void?
v) Whether the Petitioner is entitled to the reliefs sought?
64. Concerning the violation of right to fair administrative action under Article 47 of the Constitution, Counsel recited the provisions of Article 47 (1) & 47 (2) of the Constitution and also made reference to Section 4 (3) of the Fair Administrative Action Act, '.2015, arguing that Section 4(3) imposes a mandatory duty on administrators to provide notice, reasons, disclosure of adverse material, and an opportunity to be heard before taking any adverse action and argued that the Petitioner was subjected to an opaque vetting process and disqualified from contesting as a Director in the elections held on 28 th April 2024 as the Petitioner was never shown or asked to comment or any inquiry conducted on the "Ngelani Project Report" which was the reason for his disqualification. Counsel argued that this was a fundamental omission that contravened both procedural fairness and the substantive fairness. Counsel relied on the decision of Dr Associates Ltd v Capital Markets Authority & Another (2012/ eKLR where it was held that fail
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1. The Petition dated 3/6/2024 is supported by the Supporting affidavit of the Petitioner, ISAAC SILA of similar date, his further and supplementary affidavits sworn on 20/2/2025 and 26/3/2025 respectively.
2. In opposition, the Respondent (a limited liability company) and, the 1 st and 2 nd Interested Party, all represented by Adra Advocates LLP filed Grounds of Opposition dated 20/11/2024 and a Replying affidavit of even date.
3. The Petitioner challenges the decision of the Respondent’s Board of Directors to disqualify him from participating in the election of the Respondent’s Board of Directors which were scheduled to be held on 20/4/2024 to replace two directors who were retiring on the grounds that vetting and nomination criteria applied by the Respondent not only contravened express constitutional and legal requirements, but was also neither provided for nor envisaged by the Respondent’s Articles of Association that governs election of directors. The core of the Petition is that the Respondent failed give him notice of the allegations made against him or afford him an opportunity to be heard before disqualifying him from the elections.
4. The Petitioner thus seeks the following reliefs:
i. A Declaration that the Respondent’s action of disqualifying the Petitioner from presenting himself as a candidate for elections of Director of the Respondent held on 20th April 2024 was a violation of Article 47 of the Constitution hence null and void.
ii. A Declaration that the Respondents action of disqualifying the Petitioner from presenting himself as a candidate for the elections of Director of the Respondents held on 20th April, 2024 was a violation of Article 36 of the Constitution hence null and void.
iii. As a consequence of Prayer (i) & (ii) the elections of the Respondents elections of Directors held on 28th April, 2024 are hereby declared null and void.
iv. Costs.
v. Any other relief this Court may deem fit and just to grant.
PETITIONER’S CASE
5. The Petitioner deposed that he is a member and shareholder of the Respondent. He deponed that Clause 83 of the Respondents Articles of Association provides that the Election of Directors will be held after every year during an Annual General meeting. However, shareholders in a properly Constituted General meeting can shorten or lengthen the tenure of a director if the need arises as long as the reasons for shortening or lengthening the tenure of a Director for Two (2) years be explained in the General meeting and supported by a simple majority in the meeting.
6. He averred that Clause 84 of the Respondents Articles of Association provides that the candidate for elections of Director should be proposed and seconded by shareholders of the company while Clause 86 provides that elections shall be by a show of hands and the candidates with the highest number of votes will be considered the winner.
7. He contended that the Respondents Articles of Association do not contain any provision for vetting of candidates. He exhibited a copy of the Memorandum and Articles of Association of the Respondent "IS1" to buttress this position.
8. He further deponed that the Respondent sent a notice ( exhibit IS 2 ) to all its shareholders informing them that two (2) Board of Directors positions would fall vacant in the upcoming 13th Annual General meeting (AGM) to be held on 20th April 2024 and that these vacancies were to be filled in the same meeting and thus invited applications from Interested and qualified candidates from shareholders to express Interest and get an opportunity to “nominated" as a Board member.
9. The Petitioner stated that the Notice specified that the candidates were required to undergo a nomination to be selected as members of the Board as it was the Respondents Board Policy to balance the skills and experiences of her directors considering special requirements of the company. Further, the Notice specified the Academic qualifications and personal qualities for the candidates.
10. The Petitioner stated that submitted his application ( annexure ‘IS3’ ) for the position of Director on 12th March, 2024.
11. He deponed that on 9th April 2024, he received a letter ( annexure ‘IS4’ ) from Lumallas Achieng' & Kavere Advocates on behalf of the Respondent informing him that he had been disqualified from presenting himself as a candidate for elections as a director for the following reasons;
a. An internal audit report on the Ngelani Project, alleging that certain transactions transpired during my tenure and under my advisement.
b. That the Board was still investigating policy and prudence lapses in the project and intended to sanction those found culpable.
c. That my continued presence on the Board during investigations posed a conflict of interest.
12. The Petitioner explained that he responded through a letter from his Advocates dated 11 th April 2024 ( annexure 5 ) indicating that he was neither served nor aware of the alleged audit report and asked for an opportunity to defend himself. He stated that no opportunity was accorded to him in that regard. He swore he was never issued with any show cause letter prior to this communication.
13. The Petitioner averred that on 20 th April 2024, the Respondent held its Annual General meeting in which Item 6 of the agenda (annexure IS 6) was the retirement and Election of Directors that stated as follows:
i) "Mr. Simon Mburu retires by rotation in accordance with
Articles 72 and 105 of the Company’s Articles of Association
and being eligible offers himself for re-election.
ii. Mr. Patrick Alubee retires by rotation in accordance with
Article 72 and 105 of the Company's Articles of Association.
iii. Mr. Chris Miyinzi Mwingu offers himself for election as Director of the Company."
14. The Petitioner contends that the Respondents action of purporting to conduct a vetting of the Petitioner’s application to be presented as a candidate for elections as Director without giving the Petitioner a chance to participate in the vetting process is a violation make of the Petitioners Constitutional Right to Fair Administrative Action under Article 47 of the Constitution. He further goes on to protest that the decision to disqualify the Petitioner from participating in the elections of Director of the Respondent on 28th April, 2024 is a violation of the Petitioners Constitutional rights under Article 47 and 36 of the Constitution.
15. The Petitioner addressing the assertion in the Respondent’s response that this is a mere commercial dispute requiring this Court invoke the doctrine of constitutional avoidance refuted the position taken by the Respondent.
16. He contended that the Board of Directors Charter, which provides for ‘Nomination Committee’ also makes reference under annexure 1 thereof to the Capital Markets Authority Guidelines on Corporate Governance - Gazette Notice 3362,and provides among others, that the functions of this Committee include conducting a formal, and transparent procedure in nomination of Directors of the Board ( annexure ‘IS 1 & 2’ of the Petitioner’s Further affidavit ).
17. He deposed that at the time of his disqualification, no determination of any wrongdoing had been made against him and the Respondent failed to establish any direct or clear conflict of interest to justify his disqualification under clause 2.1.5 of the Capital Markets Authority Guidelines and thus maintained the decision to bar him was arbitrary and a violation of Article 27 that guarantees him equal benefit and protection of the law.
18. He further asserted disqualification violated his human dignity under Article 28 as it was based on unverified audit report coupled with refusal to affording him an opportunity to be heard, thereby depriving him the dignity of a fair process.
19. He thus maintained that there is clear evidence of violation of his constitutionally guaranteed rights that properly fall within the exercise of this Court’s jurisdiction under Article 22, 23 and 165 (3) (b) of the Constitution.
20. The Petitioner explained that he worked as the Operations officer of the 1 st Respondent and his job description entailed identification of potential land for acquisition as the Respondent's primary business was the acquisition and sale of land for profit.
21. He clarified that after identification of the property, would then prepare a project proposal to the General Manager for approval and presentation to the Investment and Business Development Committee of the Respondent Board of Directors after which the Investment and Business Development Committee (lBDC) would conduct due diligence including visiting the property, meeting the seller, negotiating the prices and once satisfied, table the report to the full Board of Directors for approval
22. He disclosed that the Board of Directors of the Respondent would then approve the IBDC report and the property would be purchased.
23. He stated this procedure actually complied with in relation to Ngelani project as well as all other projects of the Respondent as the it was procedurally approved and oversighted by the Respondent's General Manager, IBDC and Board of Directors as per the procedures of the Respondent.
24. He contended that it was unprocedural that the same Board of Directors that approved the project that investigating that very project and further that, the Respondent's Board of Directors was never disqualified from their positions as directors pending the alleged investigations into the project.
25. He deposed that he was the only one who was affected by the al1eged investigations into the Ngelani project without any communication from the Respondent or documentation to supporting the alleged audit.
26. The Petitioner stated that he handled over 25 projects during his tenure as the Operations Officer of the Respondent without any allegations of impropriety, including the Ngelani Project, ever being made against him.
27. He thus maintained that the decision to clandestinely disqualify him from vying for the directorship was unsubstantiated, unprocedural and a violation of his right to a fair hearing and an attack to his integrity
28. He deponed that the Respondent has now changed tact and has withdrawn the allegations against him, in that on 21 st March 2025, ( annexure ‘IS 3’ of the Supplementary affidavit) he received an email from the Respondent together with a letter stating as follows:
"Please note that the investigation into the acquisition of L.R No. 8914/ 208 Ngelani ('the Property'} is now complete. The Board has resolved not to pursue any further action."
29. He asserted that the Respondent’s Board's resolution to take no further action confirms that there was no wrongdoing on his part, and therefore, the disqualification from participating in the said elections was malicious, unlawful and unconstitutional as it did not only adhere to the Articles and Memorandum of Association of the Respondent but also the Capital Markets Authority Guidelines on Corporate Governance and the Constitution.
30. He states that following the unfair disqualification, he has suffered mental anguish arising from public humiliation and reputational damage caused by the baseless allegations, unwarranted legal costs, defending himself against unsubstantiated claims, the loss of opportunity to serve as a Director of the Respondent and constitutional violations already alluded to in this Petition.
RESPONDENT AND THE 1 ST AND 2 ND INTERESTED PARTIES’ CASE
31. In response to the Petition, the Respondent and the 1 st and 2 nd Interested Parties filed grounds of Opposition dated 20/11/2024 and the Replying affidavit of even date.
32. The Grounds of Opposition were as follows:
1. The Petition offends the doctrine of Constitutional Avoidance which espouses that a court will not determine a constitutional issue when a matter may be properly decided on another basis.
2. The Petition discloses nothing more but a pure commercial dispute pertaining to the Respondent’s internal affairs and in particular, the Respondent’s vetting process.
3. The Respondent’s internal affairs are governed by the provisions of the Company’s Act No. 7 of 2015 and the Respondent’s articles of association.
4. The Respondent’s articles of association are a binding contract between the Respondent and all its shareholders, and any claim should be brought under the principles of contract law.
5. The Petition does not raise constitutional questions, rather it is a commercial dispute that can be properly decided by way of an ordinary plaint.
6. The Honourable Court therefore lacks the jurisdiction to determine the Petition.
7. The Petition is frivolous, vexatious and an abuse of the Honourable Courts time and process and ought to be struck out with costs to the Respondent and the 1st and 2 nd Interested Parties.
33. The replying affidavit of the Respondent was sworn by CAREN KUTTO, the Administration and Digital Marketing Officer of Kimisitu Investment Company PLC (the Respondent).
34. She restated that the Petition discloses nothing more but a pure commercial dispute pertaining to the Respondent’s internal affairs and in particular-the Respondent’s vetting process hence the Petition offends the doctrine of constitutional avoidance.
35. The Respondent confirmed that it notified its shareholders that two Board of Directors Positions were to fall vacant in the Annual General meeting that was to be held on 20 April 2024 and invited any interested and qualified candidates to express interest and get an opportunity to be nominated as a board member ( per exhibit CK 1 ), which disclosed the criteria with which all the candidates were to be subjected to and included- academic and professional qualifications as well as personal qualities which included inter alia, that the Candidate had to meet the requirements of Chapter six of the Constitution.
36. The deponent went further to state that following the notification of vacancy, the Petitioner submitted his application dated 12 March 2024 for consideration and nomination for the position of Director (CK 2).
37. The Respondent notes that, from the Petitioner’s own application document, the Petitioner was fully aware that all applicants had to undergo nomination and vetting process based on disclosed criteria in the vacancy notice, prior to presentation to shareholders elections. She stated:
“… From the Petitioner’s application, he understood that all the applicants had to go through a nomination and vetting process against the criteria disclosed in the vacancy notice prior to their presentation to shareholders for Director’s election. In his application he wrote:
“Thanking you in advance and hoping to be given an opportunity to present myself to the shareholders during the forth-coming AGM…”
38. The Respondent confirmed that the process of appointment of Directors at the Respondent company is well laid out under Clause 83 of the Respondent’s Article of Association dated 4 August 2010 ( exhibit CK 3 ) which provides inter alia:
“83. The Election of Directors will be held after every year during an Annual General Meeting (AGM) but the Shareholders in a properly constituted General Meeting can shorten or lengthen the tenure of a director if the need arises. Reasons for shortening or lengthening the tenure of a director from two years must be explained in the General Meeting and supported by a simple majority in the meeting.”
39. The Respondent however noted that the Petitioner had failed to disclose that the process of appointment of Directors is also laid out in the Respondent’s Board of Directors Charter (the Charter) - exhibit CK 4 where under chapter 2 of the Charter- clause 2.4 that provides:
“2.4 There shall be clear formal and transparent procedure for nomination and appointment of new Directors to the Board . In this regard, the Board shall:
all Directors will be required to submit themselves for election by shareholders by rotation periodically, but in any event within a period not exceeding two years.”
40. The deponent further disclosed that the Notice of Director’s vacancy by the Respondent made reference to the Respondent’s Board Charter and informed the shareholders that all candidates were to undergo a nomination and election process to be selected as members of the board as follows:
“The candidates will go through nomination and election process to be selected as members of the Board, it is the Kimisitu Board Policy to balance the skills and experiences of her directors yet considering unique or special requirements of the company.”
41. Moreover, the Respondent went on to state the chapter four of the ‘The Charter’ provides for the Roles and Functions of the Board which include inter alia:
‘4.1.3 (b) Ensure that, through a managed and effective process, Board
appointments are made that provide a mix of proficient Directors, each of whom is able to add value and bring independent judgment to bear on the decision-making process.’
42. The Respondent deposed that ‘ The Charter’ , under chapter eleven , provides for Board Committees and their terms of reference. The Charter provides for a minimum of five standing committees of the Board, with one of the Committees being the Nomination Committee .
43. The Respondent pointed out that annexure 1 of the Charter , subscribes to the Capital Markets Authority Guidelines on Corporate Governance Gazette Notice No. 3362 . (the Guidelines). These Guidelines under clause 2.1.5 provide for the appointments to the Board as follows:
“There should be a formal and transparent procedure in the appointment of Directors to the Board and all persons offering themselves for appointments, as Directors should disclose any potential area of conflict that may undermine their position or service as Director.”
44. She went further to cite Clause 3.1.3 which provide for the appointment of a nominating Committee with the responsibility of proposing new nominees for the Board as well as assessing the performance and effectiveness of Directors of the company, and further provide the responsibilities of the nomination committee which includes inter alia that:
“c. The nomination committee shall consider only persons of calibre, credibility and who have the necessary skills and expertise to exercise independent judgment on issues that are necessary to promote the company’s objectives and performance in its area of business.”
45. The Respondent maintained that it was based on all the foregoing provisions that the Respondent’s nominating committee, upon receipt of the applications, vetted all the applications against the disclosed criteria and based on the findings of the vetting process, determined that it would not proceed with the Petitioner’s application and the Petitioner was informed of the decision of the Nomination Committee through a a letter dated 9 th April 2024 ( exhibit CK 5 ) from its then Advocates, Lumallas Achieng & Kavere Advocates which stated inter alia as follows:
a. “The internal Audit Report on the Ngelani Project reveals that the transaction under review transpired during your tenure and under your advisement on some aspects.
b. That the company is investigating related lapses in policy and prudence and may propose sanctions against those found culpable for the financial loss occasioned by the project.
c. That your being on the Board during the said investigations poses a conflict of interest.”
53. The deponent disclosed that the Petitioner in his application for the Director’s post, indicated as part of his experience that he worked as an Operations Officer for the Respondent from 2011 to March 2020 and his duties included pension matters, shares registration and company secretarial, finance, accounts, human resource and administration, sales and marketing, real estate, public relations, investment and portfolio management, legal and customer service. Further, in his performance review of 2016, he had indicated that he was involved in the Ngelani Land project which did not perform well.
46. The Respondent had also issued the Petitioner with a letter indicating its concern over his performance in 2017 ( see exhibits CK 6 & 7 ).
47. The Respondent deposed that due to the poor performance of the Ngelani project, which was admitted by the Petitioner, the Respondent tasked its internal auditor to audit the project and share its findings as part of its investigations to determine the reasons for the poor performance.
48. The Respondent explained that due to the pending investigations and the potential conflict of interest that the Petitioner’s election as Director would have posed to the investigations, the nominating Committee, in performing its role to promote the independent judgment of all nominated candidates, decided not to proceed with the Petitioner’s candidacy. The Respondent averred that the Nominating Committee’s decision not to proceed with the Petitioner’s application was thus communicated to him with the reasons given for the decision and advising the Petitioner that it would be prudent to await the outcome of the ongoing investigations and be cleared first prior to offering himself for the election in the best interest of the Company.
49. The Respondent stated that upon conclusion of the nomination and vetting process, the Respondent presented the 1st and 2nd Interested Parties to the Shareholders during the Annual General Meeting held on 20 April 2024, to be elected as Shareholders. The details of the new directors were forwarded to the Registrar of Companies and the register was updated accordingly ( per CR 12- exhibit CK 8 ).
50. The Respondent reiterated and affirmed that it duly complied with the processes provided in its own internal documents that govern the elections of its Board of Directors, namely: the Articles of Association, the Board Charter and the Guidelines by the Capital Markets Authority in arriving at the decision to bar the Petitioner, in that:
a. It invited its shareholders to apply for the vacant position of Director of the Company and set out the qualifications required on the notice.
b. The Board of Directors constituted a nominating Committee as per the Charter, with powers to determine the appointment criteria which was made known to all applicants and against which all applicants were assessed.
c. After the assessment, the Petitioner was informed of the committee’s decision and the reasons for the decision.
d. There was a clear formal and transparent procedure for the nomination and appointment of the Directors and all the applicants were aware of the procedure.
51. The Respondent thus refuted the Petitioner’s contention that the Respondent violated his Right to fair administrative action and freedom of association terming the allegation false in the light of the fact that the Petitioner was given a chance to tender his application, and the nomination and vetting process was clear and transparent, and the Respondent adhered to it. The Respondent clarified that the decision by the Respondent does not Bar the Petitioner from participating in future elections of Directors, after the outcome of the investigations, cleared him.
52. The Respondent deposed that the Petitioner on 22/4/2024, and prior to filing the instant Petition, the filed a Judicial Review division Review Application, ( exhibit CK 9), seeking to quash the Respondent’s decision not to proceed with the Petitioner's application. The Respondent thus accuses the Petitioner of forum shopping contending that the Petitioner has deliberately avoided the appropriate avenue of settling disputes of this nature, which is by filing a plaint as the alleged grievances are founded on the law of contract.
PETITIONER'S SUBMISSIONS
53. The Petitioner filed written submissions dated 12/5/2025 through Miller & Company Advocates. This Petitioned contended the decision to disqualify him from vying for election as a Director of the Respondent during its Annual General Meeting held on 20 th April 2024 was arrived arbitrarily, without lawful justification, and in a manner that violated the Petitioner's constitutional rights, including the right to fair administrative action, equality and freedom from discrimination, human dignity, and freedom of association.
54. Counsel reiterated the fact that the Petitioner is a shareholder and member of the Respondent, a public company registered under the Companies Act, 2015 whose affairs are governed by its Articles of Association subject to oversight by shareholders through annual general meetings and directorial elections.
55. He submitted that through a notice to all its shareholders, the Respondent notified that two Board or Directors positions would be falling vacant and invited interested and qualified shareholders to submit their nominations for election to the Board of Directors during its Annual General Meeting scheduled for 20 th April 2024. The Petitioner, being qualified and interested, he submitted his nomination in accordance with the stipulated timelines.
56. However, on 9 th April 2024, the Petitioner was informed by a letter on behalf of the Respondent that his candidature had been disqualified by the "vetting committee," purportedly due to ab adverse mention in the "Ngelani Project Report'' which despite multiple requests, the Petitioner was not furnished with or any formal communication detailing the grounds of disqualification conveyed.
57. Further, that no hearing was conducted thus the Petitioner was denied a fair opportunity to be heard, contrary to the dictates of Article 47 of the Constitution. In addition, that process was overseen and influenced by individuals with personal stakes in the outcome of the election, including the Interested Parties who were candidates in the election.
58. Counsel submitted that the nomination and vetting process that led to the disqualification of the Petitioner had no legal foundation both under the Respondent's Articles of Association, the Companies Act, or Regulatory framework. He argued that the Articles of Association (Clauses 83-86) do make any provision for disqualification of candidates prior to the AGM, which vest the electoral power solely on the shareholders hence in purporting to bar the Petitioner from the elections, the Respondent acted ultra vires its Articles and violated the principles of good corporate governance and constitutionalism under Article 10 of the Constitution.
59. Counsel submitted that the Petitioner was selectively and discriminatorily targeted, in that, other individuals similarly alleged to have been involved in the Ngelani Project, comprised the current board members who were permitted to contest the elections without any vetting thus the Petitioner's constitutional right to equality under Article 27, dignity under Article 28, and freedom of association under Article 36 were violated. Counsel submitted that the process to lock the Petitioner out of the election involved his direct competitors, namely, the 1st and 2nd Interested Parties, hence, creating a clear conflict of interest that rendered the process biased, unreasonable, and procedurally unfair.
60. The Petitioner submitted that the culmination of this unlawful and unconstitutional process was the conduct of the Respondent's election of Directors on 28 th April 2024 where the Petitioner was excluded from participation.
61. The Petitioner further argued that the decision to bar him from contesting in the elections was based on vague and unproven allegations connected to the so called "Ngelani Project Report," which he had neither seen nor had he been afforded an opportunity to respond.
62. Counsel submitted that on 21st March 2025, the 1st Respondent issued a letter to the Petitioner exonerating him from any wrongdoing in relation to the ‘Ngelani Project’ which he argued confirmed that the allegations underpinning the disqualification were baseless, and so was the process leading to the exclusion was factually and legally unfounded and a grave abuse of power and breach or procedural fairness.
63. Counsel further isolated and explicated the following specific issues:
i) Whether the disqualification of the Petitioner was in violation of his right to fair administrative action under Article 47 of the Constitution?
ii) Whether the disqualification of the Petitioner was discriminatory and in contravention of Articles 27 and 28 of the Constitution?
iii) Whether the Respondents acted ultra vires in disqualifying the Petitioner'?
iv) Whether the election held on 28 th April 2024 is null and void?
v) Whether the Petitioner is entitled to the reliefs sought?
64. Concerning the violation of right to fair administrative action under Article 47 of the Constitution, Counsel recited the provisions of Article 47 (1) & 47 (2) of the Constitution and also made reference to Section 4 (3) of the Fair Administrative Action Act, '.2015, arguing that Section 4(3) imposes a mandatory duty on administrators to provide notice, reasons, disclosure of adverse material, and an opportunity to be heard before taking any adverse action and argued that the Petitioner was subjected to an opaque vetting process and disqualified from contesting as a Director in the elections held on 28 th April 2024 as the Petitioner was never shown or asked to comment or any inquiry conducted on the "Ngelani Project Report" which was the reason for his disqualification. Counsel argued that this was a fundamental omission that contravened both procedural fairness and the substantive fairness. Counsel relied on the decision of Dr Associates Ltd v Capital Markets Authority & Another (2012/ eKLR where it was held that fail
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