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JudgmentTAALERI AFRIKKA II KY VS CYTONN INVESTMENT MANAGEMENT PLC5 min read

TAALERI AFRIKKA II KY VS CYTONN INVESTMENT MANAGEMENT PLC

High Court at Milimani High Court · · Githiru Freda Mugambi

Introduction and Background

1. The applicant moved this Court through a Notice of Motion application dated 19th December 2024, seeking the recognition and enforcement of an arbitral award dated 20th November 2024, made by the arbitration tribunal consisting of Angeline Welsh, Thomas Kendra and Chiann Bao of the London Court of International Arbitration. In response, the respondent filed a Replying Affidavit dated 19th February 2025 and subsequently lodged a Preliminary Objection dated 13th May 2025, contending that the applicant lacks locus standi to maintain the present suit.

2. The respondent argues that the applicant, being a foreign juridical entity, has failed to comply with the mandatory statutory requirements under sections 974, 975, and 985 of the Companies Act 2015. That consequently, the applicant lacks the legal capacity to institute or sustain the current proceedings. Furthermore, the respondent argues that the application as filed is in any case fatally defective for failure to comply with the requirements of Rule 4(1) and (2) and Rule 9 of the Arbitration Rules. On these grounds, the respondents urge that the entire suit and application be struck out in limine, with costs.

Analysis and Determination

3. I have considered the preliminary objection, response thereto and the submissions of the parties in support of their respective cases. The objection centers firstly on whether the applicant, a company incorporated in the Republic of Finland, has locus standi to institute the present suit. This matter has already been conclusively determined by this very Court in HCCCOMM NO 524 OF 2020; TT Africa Real Estate Company v Ololua Estates LLP and Cytonn Investments Management PLC.

4. In a Ruling dated and delivered on 28th January 2026, this Court pronounced itself thus:

“It is my observation that while Sections 974, 975, and 985 of the Companies Act prescribe the procedure for registration of foreign companies intending to carry on business in Kenya, these provisions should not be confused with the separate and distinct question of locus standi.

Locus standi, as defined in Matemu v Trusted Society of Human Rights Alliance & 5 others [2014] KESC 6 (KLR), refers to the right of a party to bring an action or to be heard in a given forum. It requires demonstration of sufficient interest in the subject matter, either through direct impact of the impugned action or a legal or contractual relationship entitling the party to relief. Thus, locus standi is concerned with whether a claimant has a genuine stake in the matter before the Court, not whether it is registered locally to conduct business. I do reiterate my earlier holding in Superon Schweisstechnik India Ltd v Oxychem Africa Limited; Registrar of Trademarks (Interested Party) [2025] KEHC 8298 (KLR) in this regard.

In the present case, the Applicant’s claim arises from enforcement of an arbitral award under Section 36 of the Arbitration Act, which expressly allows recognition and enforcement of both domestic and international awards. There is no statutory requirement that a foreign award creditor must be registered in Kenya to seek enforcement.

Further, the spirit of access to justice so deeply entrenched under Articles 48, 50(1), and 22(1) of the Constitution supports the right of a foreign company to sue in Kenya where it seeks to enforce a legal right. Accordingly, the objection on locus standi fails”.

5. I need not belabor the point. The objection predicated upon the issue of locus standi is without merit and accordingly fails. Moreover, in the same matter, this Court has previously pronounced itself on analogous procedural objections raised by the respondents herein. In that decision, the Court observed as follows:

“I acknowledge that the Arbitration Rules expressly require applications relating to arbitral awards to be brought by way of Chamber Summons. Nonetheless, I am guided by Article 159 of the Constitution, which enjoins courts to administer justice without undue regard to procedural technicalities.

The jurisprudence of the Court of Appeal, particularly in Trust Bank Limited v Amalo Company Limited Civil Appeal No. 215 of 2000 [2002] 2 KLR 627; [2003] 1 EA 350, and Central Bank of Kenya v Uhuru Highway Development Ltd & Others Civil Appeal No. 75 of 1998, reinforces this principle by emphasizing that procedural lapses which do not occasion prejudice to the parties should not be elevated into fatal defects.
In the present case, although the Applicant proceeded by Notice of Motion rather than Chamber Summons, the Respondents were duly served and afforded an opportunity to respond. No prejudice has been demonstrated, and the irregularity does not impede the Court’s jurisdiction or the fair determination of the matter”.

6. The circumstances herein are, in all material respects, analogous and apply mutatis mutandis to the present case. Consequently, the objection predicated upon the form of the application is equally devoid of merit and must fail.

7. Having dispensed with the preliminary points, I now move to the substantive application, which is opposed by way of a Replying Affidavit sworn by Edwin Harold Dayan Dande on 19th February 2025. I note that the Replying Affidavit has adversely assailed the factual findings of the tribunal. Jurisprudence is well settled that the right under section 35 of the Act does not extend to questioning the merits of the case and that the arbitrator remains as all times the master of fact. This position was affirmed by the Court of Appeal in Thaara Limited v WS Insight (K) Limited & another [2024] KECA 1464 (KLR). I shall therefore steer clear of any invitation to reopen the merits of the arbitral award, a situation not envisaged under section Section 35(2) for setting aside an award.

8. That said, I equally reiterate my previous finding that insolvency proceedings do not constitute a valid ground for refusing recognition under the Arbitration Act. An arbitral award may be enforced by a successful party as a creditor, subject to the applicable insolvency framework. The contention that enforcement would prejudice other creditors is a matter to be addressed within the insolvency process itself, and not a basis upon which this Court may decline recognition.

9. Having failed to successfully oppose the application, this Court is now enjoined to address the requirements under Section 36 of the Arbitration Act. Upon perusal of the record, it is evident that while the applicant has produced a certified copy of the arbitral award dated 20th November 2024, the original arbitration agreement or a duly certified copy thereof has not been furnished. In the absence of full compliance with the statutory requirements, this Court cannot properly exercise its jurisdiction to recognize or enforce the award.

Disposition

10. Accordingly, the fair and just course is to strike out the application, so as to allow the applicant to pursue recognition and enforcement through the proper procedure as prescribed by law. I make no orders as to costs.

DATED, SIGNED AND DELIVERED IN NAIROBI
THIS 6th DAY OF MAY 2026.

F. MUGAMBI
JUDGE
    TAALERI AFRIKKA II KY VS CYTONN INVESTMENT MANAGEMENT PLC TAALERI AFRIKKA II KY VS CYTONN INVESTMENT MANAGEMENT PLC