1. Before court is the Notice of Motion dated 16 June 2026 by Middle East Bank Kenya Limited (“the Applicant”) seeking an order that time for registration of a charge dated 9 July 2024 under section 885 of the Companies Act, 2015 be extended by sixty (60) days from the date of the order.
2. The application is supported by the affidavit of Felix Ngang’a Karanja sworn on 16 June 2026. He depones that the Applicant advanced Norkan Investments Limited a facility of KES 500,000,000 secured by a charge over properties known as Nairobi/Block 48/315 and Nairobi/Block 48/316. The charge remains unregistered because there was a delay in obtaining the duly executed instrument and payment of stamp duty, and by the time the process was completed, the statutory period for registration had lapsed. He further states that the delay was inadvertent, beyond the Applicant’s control and that no prejudice will be occasioned to the company, its creditors or shareholders if the orders sought are granted.
3. The issue for determination is whether the Applicant has established a basis for extension of time to register the charge.
4. Section 885(1) of the Companies Act requires a company to deliver particulars of a registrable charge to the Registrar within forty-two (42) days of its creation. Section 885(3) empowers the court, upon being satisfied that the omission or delay to register was accidental, due to inadvertence or some other sufficient cause, or that it is just and equitable to grant relief, to extend the time for registration on such terms as it deems fit.
5. The purpose of registration of charges is to give notice to persons dealing with the company of encumbrances affecting its assets. The court’s power under section 885(3) is discretionary and is intended to prevent undue hardship where the delay is satisfactorily explained and no prejudice would be occasioned to creditors, shareholders or other interested parties.
6. In exercising this discretion, the Court must be guided by the principle established in National Bank of Kenya Ltd v Michael Ndungu [2018] eKLR, which emphasizes that where a delay is explained, and no third-party interests are prejudiced, the Court should favor the perfection of substantive security interests over procedural technicalities.
7. In the present case, the Applicant has explained that the delay arose because the charge instrument had not been fully executed and stamp duty processes had not been completed within time. There is no evidence suggesting any deliberate omission, bad faith or an intention to defeat the interests of creditors, nor is there any indication that any person will suffer prejudice if the charge is registered out of time.
8. I am therefore satisfied that the Applicant has established sufficient cause to warrant the exercise of the court’s discretion under section 885(3) of the Companies Act.
9. Consequently, the Notice of Motion dated 16 June 2026 is allowed on the following terms:
i. Time for registration of the charge dated 9 July 2024 created by Norkan Investments Limited in favour of Middle East Bank Kenya Limited is hereby extended by sixty (60) days from the date of this order.
ii. The Applicant shall lodge the prescribed particulars and all requisite documents for registration with the Registrar of Companies within the said period.
iii. In default of compliance within the aforesaid period, these orders shall lapse automatically unless otherwise extended by the court.
iv. There shall be no order as to costs.
10. It is so ordered.
DATED, SIGNED, AND DELIVERED AT NAIROBI
THIS 18TH DAY OF JUNE 2026
HON. MR. JUSTICE MOSES ADO
Judge of the High Court
2. The application is supported by the affidavit of Felix Ngang’a Karanja sworn on 16 June 2026. He depones that the Applicant advanced Norkan Investments Limited a facility of KES 500,000,000 secured by a charge over properties known as Nairobi/Block 48/315 and Nairobi/Block 48/316. The charge remains unregistered because there was a delay in obtaining the duly executed instrument and payment of stamp duty, and by the time the process was completed, the statutory period for registration had lapsed. He further states that the delay was inadvertent, beyond the Applicant’s control and that no prejudice will be occasioned to the company, its creditors or shareholders if the orders sought are granted.
3. The issue for determination is whether the Applicant has established a basis for extension of time to register the charge.
4. Section 885(1) of the Companies Act requires a company to deliver particulars of a registrable charge to the Registrar within forty-two (42) days of its creation. Section 885(3) empowers the court, upon being satisfied that the omission or delay to register was accidental, due to inadvertence or some other sufficient cause, or that it is just and equitable to grant relief, to extend the time for registration on such terms as it deems fit.
5. The purpose of registration of charges is to give notice to persons dealing with the company of encumbrances affecting its assets. The court’s power under section 885(3) is discretionary and is intended to prevent undue hardship where the delay is satisfactorily explained and no prejudice would be occasioned to creditors, shareholders or other interested parties.
6. In exercising this discretion, the Court must be guided by the principle established in National Bank of Kenya Ltd v Michael Ndungu [2018] eKLR, which emphasizes that where a delay is explained, and no third-party interests are prejudiced, the Court should favor the perfection of substantive security interests over procedural technicalities.
7. In the present case, the Applicant has explained that the delay arose because the charge instrument had not been fully executed and stamp duty processes had not been completed within time. There is no evidence suggesting any deliberate omission, bad faith or an intention to defeat the interests of creditors, nor is there any indication that any person will suffer prejudice if the charge is registered out of time.
8. I am therefore satisfied that the Applicant has established sufficient cause to warrant the exercise of the court’s discretion under section 885(3) of the Companies Act.
9. Consequently, the Notice of Motion dated 16 June 2026 is allowed on the following terms:
i. Time for registration of the charge dated 9 July 2024 created by Norkan Investments Limited in favour of Middle East Bank Kenya Limited is hereby extended by sixty (60) days from the date of this order.
ii. The Applicant shall lodge the prescribed particulars and all requisite documents for registration with the Registrar of Companies within the said period.
iii. In default of compliance within the aforesaid period, these orders shall lapse automatically unless otherwise extended by the court.
iv. There shall be no order as to costs.
10. It is so ordered.
DATED, SIGNED, AND DELIVERED AT NAIROBI
THIS 18TH DAY OF JUNE 2026
HON. MR. JUSTICE MOSES ADO
Judge of the High Court