Case Law[2026] KEHC 1206Kenya
Mycredit Limited v Micro and Small Enterprises Tribunal; African Herbal Ingredient Wholesalers Limited (Interested Party) (Judicial Review Application E196 of 2025) [2026] KEHC 1206 (KLR) (Judicial Review) (10 February 2026) (Judgment)
High Court of Kenya
Judgment
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA AT NAIROBI
JUDICIAL REVIEW DIVISION
JUDICIAL REVIEW APPLICATION NO E196 OF 2025
MYCREDIT
LIMITED………………………………………………………...APPLICANT
VERSUS
MICRO AND SMALL
ENTERPRISES TRIBUNAL………………………………...
RESPONDENT
AND
AFRICAN HERBAL INGREDIENT
WHOLESALERS LIMITED………………………..INTERESTED PARTY
JUDGMENT
1. This judgment determines the applicant’s Notice of Motion dated 5/7/2025
filed pursuant to leave of Court granted on 16/6/2025 in HC JR
Miscellaneous application No. E064 of 2025.
2. The applicant seeks the following substantive orders:
a. THAT the Honourable Court be pleased to issue an ORDER OF
PROHIBITION directed to the Respondent stopping and/or
restraining it from continuing with any proceeding in Nairobi Micro
and Small Enterprises Tribunal Claim No. E001 of 2025 African
Herbal Ingridient Wholesalers Limited versus MyCredit Limited.
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b. THAT the Honourable Court be pleased to issue an ORDER FOR
CERTIORARI to remove into this Honourable Court to quash the
proceedings of the Respondent in Nairobi Micro and Small
Enterprises Tribunal Claim No. E001 of 2025 African Herbal
Ingridient Wholesalers Limited versus My Credit Limited including
its orders but not limited to those of 27th May, 2025.
c. THAT the costs of the application be provided for.
3. The applicant’s case is that the Interested Party filed a Notice of Motion
application dated 26th May, 2025 under certificate of urgency before the
Micro and Small Enterprises Tribunal. That on 27th May, 2025 the
Honourable Chairperson considered the application and granted the orders
sought therein in the interim pending the hearing and determination of the
application.
4. The applicant being aggrieved by the orders issued on 27th May, 2025 filed
an application dated 29th May, 2025 seeking to set aside the orders issued on
27th May, 2025.
5. The applicant contends that the Tribunal did not have jurisdiction to
entertain the claim lodged by the interested party herein, as provided for
under Sections 54(1) and 55 of the Micro and Small Enterprises Act for the
reasons that the Ex parte Applicant is neither a member of the Micro and
Small Enterprises Authority nor is it regulated by the Micro and Small
Enterprises Act as it is not a micro or small enterprises defined under the
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Act, since it has a turnover of over Kshs. 1,000,000/- and has hundreds of
employees all over the country.
6. The applicant claims that it will be prejudiced if subjected to the proceedings
before the Respondent which lacks authority to entertain the proceedings.
7. The applicant further asserts that the Respondent illegally abrogated itself
the authority and jurisdiction to receive and hear the Claim and application
filed by the Interested Party while ignoring clear provisions of section 55 of
the Micro and Small Enterprises Act.
8. The applicant avers that the Respondent by assuming jurisdiction over the
claim, it unlawfully and without jurisdiction acted contrary to the provisions
of Article 159 and Article 169(1)(d) of the Constitution of Kenya and
Section 55 of the Micro and Small Enterprises Act Cap 499C. It is asserted
that the applicant’s rights and interests would be jeopardized if the Tribunal
is allowed to hear a claim which is outrightly outside the statutory scope and
that it is in the interest of justice that the application is allowed and orders
sought herein are granted.
9. The application is further supported by the Statutory Statement dated 10th
June,2025 annexed thereto and the Verifying Affidavit sworn by David Kage
on 10th June, 2025 which all mirror the grounds reproduced above.
10.Only the Interested Party filed a response to the application in opposition. He
filed Notice of preliminary objection dated 7th November, 2025 contending
that the applicant’s notice of motion dated 26th June, 2025 is bad in law,
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incurable by amendment, an abuse of court process as inter alia, it offends
the doctrine of Issue estoppel and the same should be struck out and
expunged from records with costs.
11.That the applicant’s notice of motion is bad in law, incurable by amendment,
an abuse of court process as inter alia it offends the doctrine of public policy
and the same should be struck out and expunged from court records with
costs.
12.That this court lacks proper jurisdiction to entertain, hear and determine the
exparte applicant’s notice of motion dated 26th June 2025.
13.The interested party also filed a replying affidavit sworn by the director of
the interested party company with authorization signed by himself. In the
depositions, the interested party repeats the preliminary objection grounds
adding that the exhibit marked DK-01 in the Verifying Affidavit in Support
of the Ex Parte Applicant’s Notice of Motion dated 26 th June 2025 is
materially
14.defective as it states that the Share Capital is Ksh 200,000,000.00 yet Form
CR12 annexed and dated 13th November, 2025 herein shows a Share Capital
of Kshs 212,000,000.00 a difference of Kshs: 12,500,000.00 and hence the
exhibit is unreliable evidence and should be struck out with costs.
15.it was deposed that the said Notice of Motion Application is a fruit of the
Ruling issued by this Honorable Court on 16th June 2025 in HCJRMISC.
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NO. E064 of 2025 whereby the Ex Parte Applicant herein had applied for
leave to file this Suit ex parte.
16.That the Honorable Tribunal had issued Orders on 27 th May 2025 and
Order Numbers 5 and 7 restrained the Ex Parte Applicant herein from
disposing off the suit vehicle registration number KCV 747R pending the
hearing and determination of the suit in the Honorable tribunal.
17.That Order Number 6 of the Honorable Tribunal issued Orders on 27th May
2025 compelled the Ex Parte Applicant to release the suit vehicle registration
number KCV 747R to the Interested Party herein.
18.That nowhere in the Ruling issued by this Honorable Court on 16 th June
2025 in HCJRMISC. NO. E064 of 2025 did this Honorable Court vacate
the Orders issued by the Honorable Tribunal on 27th May 2025.
19.That to date the Ex Parte Applicant has defied Order Numbers 5, 6 and
7cthat the Honorable Tribunal issued on 27 th May 2025 and therefore the
Ex Parte Applicant is in contempt of the Honorable Tribunal and therefore
has no locus to be heard by this Honorable Court until it purges the above-
stated contempt.
20.That the Ex Parte Applicant’s Notice of Motion dated 26 th June 2025
should be struck out to enable the Interested Party herein to institute formal
contempt of court Application in the Tribunal against the Ex Parte Applicant
herein.
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21.That to add insult to injury, a while ago within the along Kiambu Road, the
deponent bumped into a vehicle registration number was KDV 516B which
totally resembled the suit vehicle registration number KCV 747R.
22.That out of curiosity, he did a status search with the National Transport and
Safety Authority for the suit vehicle registration number KCV 747R but the
system informed him that the registration number KCV 747R did not exist.
23.That he then did a search with the National Transport and Safety Authority
for the status of motor vehicle registration number KDV 516B and was
issued with The Details of Registered Ownership of Vehicle As At 2025-11-
07 09:59:05 Reference No: Mcr-2e6tq9l38 and that to his utter shock, the
Chassis Number JM6TC4WLAK0320897 indicated in the above-said
Reference for vehicle KDV 516B matched the one indicated in the
Registration Certificate (Log Book) Serial Number N7074233Y for the suit
vehicle registration number KCV 747R.
24.That the search with the National Transport and Safety Authority indicated
the Registered Owner of vehicle KDV 516B, Chassis Number
M6TC4WLAK0320897 as Kennedy Mariga Ngunjiri.
25.That the Ex Parte Applicant has not only failed, refused, declined, neglected
and ignored to release the suit vehicle to the deponent as Ordered by the
Honorable Tribunal on 27 th May, 2025, but has disposed of the suit vehicle
and changed the vehicle registration number to KDV 516B.
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26.That he would file a formal Application for the said Kennedy Mariga
Ngunjiri and the Ex Parte Applicants herein to produce at the same time to
this Honorable Court the said vehicle registration number KDV 516B and
the suit vehicle registration number KCV 747R to prove the above-stated
fact.
27.That the Ex Parte Applicant participated in Otieno v Mycredit Limited
& another (Tribunal Case E004 of 2023) [2024] KEMSET 1348
(KLR) where judgment of the Honorable tribunal was delivered on 12th
September, 2024, yet it never rushed to this court to challenge jurisdiction
nor filed an appeal.
28.The Notice of motion was heard by way of oral submissions on 16/12/2025
with Mr. Abidha submitting on behalf of the applicant while Mr. Muciri
submitted on behalf of the interested party.
29.The submissions mirrored the pleadings and affidavits filed by the parties
with Mr. Abidha reiterating that the Tribunal is devoid of jurisdiction to
entertain the case as filed by the interested party against the applicant, in
view of the provisions of section 55 of the Micro & Small Enterprises Act.
30.Counsel for the applicant argued that the jurisdiction of the Tribunal is
limited to Micro or Small Enterprises. That Section 54(1) establishes the
Tribunal, to deal with claims of Micro & Small Enterprises while Section 2
on Enterprises defines Small or Micro Enterprise.
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31.It was submitted that the exparte applicant has a turnover of hundreds of
millions, whose share capital is over Kshs, 200 million hence it cannot fit the
definition of Micro & Small Enterprises.
32.Mr. Abidha submitted that the dispute against the applicant offends the law
as confirmed by the CR12 of the applicant confirming that its share capital
exceeds Kshs.200 million.
33.That the Act only concerns Micro & Small Enterprises, not the company of
the magnitude of the applicant.
34.Further, that the Interested Party has not even shown that it is registered
under the Act and that Section 60 provides for appeals to the High Court by
members.
35.It was submitted that the applicant has no locus to appear before the Tribunal
as the law excludes it from the Act. he relied on the case of Owners of
Motor Vessel Lilian S v Caltex Oil Kenya Limited and the S.K. Macharia
cases, arguing that the Tribunal cannot innovate jurisdiction that it does not
have.
36.Opposing the application, Mr. Muciri on behalf of the interested party
submitted relying on the preliminary objection and replying affidavit sworn
by himself.
37.He argued that the applicant had not controverted anything that he had stated
in the preliminary objection and the replying affidavit. that the applicant had
come with unclean hands because it had participated in the Tribunal
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proceedings before and had disobeyed orders of the Tribunal by selling the
vehicle. Citing Otieno vs My Credit Tribunal Case No. E004/2023, he
submitted that there was a judgment on 12/9/2024, which the applicant did
not appeal. he relied on the doctrine of public policy, submitting that the
Tribunal will be thrown into disarray if the court finds that it has no tribunal
yet in that Otieno case, the applicant herein did not appeal against the
judgment of the Tribunal.
38. he relied on Mburu & 5 Others Civil Appeal No. E094 of 2025 KEHC
12576 KLR Family 16/9/2025 on estoppel and argued that the circumstances
are the same that the applicant did not appeal in the Otieno case so it is
estopped from challenging jurisdiction of the tribunal in this case.
39.He submitted that there the applicant’s financial statements were
questionable because according to the interested party, the applicant’s share
capital is less by 12 million and that there is also a debenture.
40.He further challenged the applicant’s counsel’s locus in this matter on
account that there was no Board resolution for Mr. Abidha to institute this
suit contrary to Order 4 of the Civil Procedure Rules, 2010. He urged this
Court to allow his replying affidavit and that this suit be dismissed so that
the parties go back to the Tribunal to deal with contempt of court orders
proceedings.
41.In rejoinder, Mr. Abidha submitted that there is consensus that the value of
the applicant is in hundreds of million hence the Tribunal has no jurisdiction.
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that there is no bigger public policy than adherence to the law and the
Constitution which obedience does not offend public policy. On alleged
Acquiescence or waiver of jurisdiction, it was submitted that jurisdiction
cannot be conferred or be waived by parties as was held by the Supreme
Court in the S.K. Macharia v Kenya Commercial Bank Limited Case, and
that estoppel does not arise here.
42.On authorisation to file suit, it was submitted that the applicant has not
contested the legal representation and hence no prejudice is demonstrated.
He prayed for the orders sought with costs.
Analysis and determination
43. I have considered the application as presented, the opposition thereto and
the respective parties’ oral submissions. I find the main issue being whether
the Respondent Tribunal has jurisdiction to determine the dispute in the
nature as filed by the interested party herein.
44.The Micro and Small Enterprises Tribunal (the Tribunal) which is the
Respondent herein is established under Section 54(1) of the Micro and Small
Enterprises Act No. 55 of 2012. (The Act). The Tribunal functions as a
subordinate court recognised under Article 169 of the Constitution.
45.The interpretation section 2 of the Act defines "micro enterprise" to mean a
firm, trade, service, industry or a business activity—
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(a) whose annual turnover does not exceed five hundred thousand
shillings;
(b) which employs less than ten people; and(c)whose total assets and
financial investment shall be as determined by the Cabinet Secretary
from time to time, and includes—
(i)the manufacturing sector, where the investment in plant and
machinery or the registered capital of the enterprise does not exceed ten
million shillings;
(ii)the service sector and farming enterprises where the investment in
equipment or registered capital of the enterprise does not exceed five
million shillings;
46.As stated in the ruling for leave to apply vide JR MISC E064 of 2025,
Section 54(1) of the Micro and Small Enterprises Act provides for the
establishment of the Tribunal to adjudicate disputes involving micro, small
and medium enterprises registered under the Act.
47.It follows that the Tribunal cannot by craft determine disputes involving
entities which are not registered under the Act either as small or micro
enterprises.
48.Section 55 (1) of the Act provides for jurisdiction of the Tribunal as follows:
55. Jurisdiction of the Tribunal
(1) If any dispute concerning the micro and small enterprises arises—
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(a)among members, past members and persons claiming through
members, past members of associations and or administrators of estate
of deceased members of the associations;
(b)between members, past members or administrators of estate of
deceased members of the association, and the Authority, or any of their
officers or members;
(c)between the Authority and an association, it shall be referred to
the Tribunal for determination.
49.In the present case, the Applicant claims that it is not registered under the
Act, nor that is it under any obligation to register, not being a micro or small
enterprise as defined under the Act. The applicant claims that the Tribunal
assumed jurisdiction to entertain a dispute against a party over whom it lacks
jurisdiction.
50.Section 55(2) of the Act sets out disputes which the Tribunal is empowered
to adjudicate upon and provides that:
(2) A dispute for the purpose of this Act shall include—
(a) commercial disputes involving micro and small enterprises;
(b) failure to comply with the terms and condition of allocation of
worksites;
(c) election and management of associations;
(d) failure to comply with the constitution or rules of a micro and small
enterprise association or umbrella organisation;
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(e) unprocedural and illegal allocation, subdivision, subletting of a
micro and small enterprise worksite;
(f) mismanagement and misappropriation of funds;
(g) any other dispute acceptable by the Tribunal.
51.The respondent did not respond to the application. However, the interested
party contends that if this court finds that the Tribunal has no jurisdiction to
entertain the dispute against the applicant, then it will be catastrophic for the
Tribunal since it has in the past entertained such disputes yet there was no
challenge or appeal on the ground of jurisdiction. Further, that the applicant
having been a party to the past dispute and having acquiesced to jurisdiction
of the Tribunal, is estopped from raising jurisdictional issues here and now,
as that is against public policy.
52.In a rejoinder, the applicant asserts that estoppel does not operate against the
law and that it cannot be against public policy where the Tribunal has no
jurisdiction yet it has assumed jurisdiction.
53.I will first deal with the question of estoppel. Estoppel is an equitable
doctrine, a bar that prevents one from asserting a claim or right that
contradicts what one has said or done before, or what has been legally
established as true. Estoppel may be used as a bar to the re-litigation of
issues or as an affirmative defence.
54.In the realm of jurisprudence, the doctrine of estoppel stands as a pivotal
mechanism designed to promote fairness and consistency in legal
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proceedings. This doctrine, deeply rooted in both common law and equity,
serves to bar individuals from contradicting their prior actions or statements
when such contradiction would result in prejudice to another party who has
relied on those actions or statements.
55.Estoppel fundamentally operates on the principle that a person should not be
allowed to assert facts or rights that are contrary to what they have
previously established by their own conduct or representation. Here are key
aspects of this doctrine:
i. Representation or Conduct: For estoppel to apply, there must be
a clear representation or conduct by one party, leading another to
believe in a particular state of affairs, whether through words,
actions, or silence.
ii. Reliance: The doctrine necessitates that the party relying on the
representation must have reasonably acted upon it to their
detriment or altered their position based on that reliance.
iii. Injustice: The primary aim is to prevent injustice, ensuring that
no party benefits from inconsistencies that could harm another
who has acted in good faith.
56.There are several types of estoppel recognized in legal systems:
i. Promissory Estoppel: This arises when one party makes a
promise or assurance to another, which, if broken, would cause
detriment to the promisee who has relied on that promise.
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ii. Estoppel by Deed: Here, parties are bound by the facts stated in a
deed, preventing them from later denying those facts.
iii. Estoppel by Record: Prevents re-litigation of issues already
decided by a court of competent jurisdiction.
57.However, Estoppel cannot negate illegality and neither can it be invoked to
override jurisdiction. This is because Courts and tribunals derive their
jurisdiction and powers from Constitutions and statutes and they cannot be
bound by private agreements or actions to exceed these foundational limits.
58.In Henry Muthee Kathurima v Commissioner of Lands & another
[2015] eKLR the court stated: -
“It is our view that estoppel cannot be used as shield to protect
unlawfully acquired property; estoppel cannot be used to circumvent
Constitutional provisions and estoppel cannot override express statutory
procedures; there can be no estoppel against a statute.”
59.In Modern Holdings (EA) Limited v Kenya Ports Authority SC Petition
No 20 of 2017 [2020] eKLR the Supreme Court acknowledged and
reiterated that the question of jurisdiction can be raised at any stage of the
proceedings and observed that:
“57. In concluding on this issue, it is trite that the question of
jurisdiction, can be raised at any stage of the proceedings…”
60.In Petition No. 8 (E010) of 2021 between Dina Management Limited
versus County Government of Mombasa and 5 others [2023] e KLR, the
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Supreme Court had this to say concerning jurisdiction and at what stage the
question of jurisdiction can be raised in proceedings:
“[60] We note that this question neither arose nor was it determined by
the trial court. It is only at the Court of Appeal vide the Attorney
General’s Cross Appeal that the court’s jurisdiction to hear and
determine the matter was first questioned on this ground. Whether the
dispute is intergovernmental in nature is a jurisdictional issue. Indeed,
jurisdiction is a pertinent question for determination. A court is bound
to always satisfy itself whether or not it has jurisdiction to hear and
determine a matter before it. In Lemanken Aramat v Harun Meitamei
Lempaka & 2 others [2014] eKLR we held that jurisdiction is a legal
question and it can be raised at any time and by any party. The
Nigerian Supreme Court in the case of Alhaji Bello Nasir v. Kano State
Civil Service Commission & 2 others, SC. 144/2003 per Ogbuagu, JSC
in his concurring judgement held as follows: “It is now firmly settled
that issues of jurisdiction or competence of a court to entertain or deal
with a matter before it, is very fundamental. It is a point of law and
therefore, a rule of court, cannot dictate when and how, such Petition
No. 8 (E010) of 2021 22 point of law can be raised. Being fundamental
and threshold issue of jurisdiction, it can be raised at any stage of the
proceedings in any court including this Court.”
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61.In other words, where a party raises the issue of jurisdiction of a court or
tribunal, such issue must be determined and estoppel cannot override
jurisdictional, constitutional or statutory provisions.
62.The interested party claims that the applicant was party to another dispute
before the Tribunal and that it never raised any jurisdictional issue or
challenge the decision by way of appeal or hence it is estopped from raising
such issue in the subsequent dispute where it is even guilty of contempt of
orders of the Tribunal by selling a motor vehicle contrary to the orders of the
Tribunal.
63.The question is, can a party plead estoppel where there is no jurisdiction. It
is trite law that Jurisdiction is not conferred by convenience, express or
implied consent. It must be expressly conferred by statute, the Constitution
or both. The jurisprudence on jurisdiction is well settled. In Owners of the
Motor Vessel “Lillian S” v Caltex Oil (Kenya) Ltd [1989] KLR 1,
Nyarangi J famously held that:
“Jurisdiction is everything. Without it, a court has no power to make
one more step. Where a court has no jurisdiction, there would be no
basis for a continuation of proceedings.”
64.The Supreme Court has repeatedly and variously held that a court’s
jurisdiction emanates from either the Constitution or legislation or both, and
as was stated in Samuel Kamau Macharia vs. Kenya Commercial Bank
Limited & 2 Others, Civil Application No. 2 of 2011 that:
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“A Court’s jurisdiction flows from either the Constitution or
Legislation or both. Thus, a Court of Law can only exercise jurisdiction
as conferred by the Constitution or other written law. It cannot arrogate
to itself jurisdiction exceeding that which is conferred upon it by Law.”
65.In the instant case, the Applicant claims that it is not registered and that
neither is it registrable under the Act, as stipulated in section 5, not being a
micro or small enterprise as defined under the Act. It was therefore upon the
interested party and the respondent to controvert those facts with evidence of
registration of the applicant under the Act. No such evidence was availed to
this Court to counter the applicant’s assertions. Therefore, in the absence of
evidence that the applicant is not subject to the jurisdiction of the Tribunal,
it cannot be dragged to the Tribunal with disputes which would otherwise be
determined by ordinary courts including small claims Court, depending on
the pecuniary claim.
66.It is noteworthy that in the earlier dispute cited by the interested party, the
judgment annexed never discussed the issue of jurisdiction. Instead, the
judgment merely stated that the Tribunal had dismissed the grounds of
opposition which had raised the issue of jurisdiction of the Tribunal. This
Court therefore was not even enabled to read and appreciate the basis upon
which the Tribunal determined that it had jurisdiction to determine that
dispute and as stated above, estoppel cannot operate to defeat jurisdiction or
statutory provisions.
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67.Secondly, the applicant claimed that it is not a micro and small enterprise as
defined under the Act. Thus, that not only is it not registered under the Act,
but that it is not an entity that is subject to the Act. The applicant therefore
challenges the jurisdiction of the Tribunal to hear and determine the dispute
filed by the interested party.
68.On whether the Tribunal had jurisdiction in the matter, the long title to the
Act provides:
An Act of Parliament to provide for the promotion, development and
regulation of micro and small enterprises; to provide for the
establishment of the Micro and Small Enterprises Authority, and for
connected purposes.
69.The Act then defines an enterprise as:
"enterprise" means an undertaking or a business concern whether
formal or informal engaged in production of goods or provision of
services.”
70.The Act further defines micro enterprise as above reproduced while a small
enterprise is defined as:
"Small enterprise" means a firm, trade, service, industry or a business
activity—
(a) whose annual turnover ranges between five hundred and five
million shillings; and
(b) which employs between ten and fifty people; and
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(c) whose total assets and financial investment shall be as determined
by the Cabinet Secretary from time to time, and includes—
i. the manufacturing sector, where the investment in plant and
machinery as well as the registered capital of the enterprise is
between ten million and fifty million shillings; and
ii. service and farming enterprises, where the equipment investment
as well as registered capital of the enterprise is between five
million and twenty million shillings.
71.A reading of section 55 (1) of the Act reveals that for the Tribunal to have
jurisdiction, the dispute must concern the small and micro enterprises. It
follows that any dispute between or among other entities or persons who do
not fit the definition of small and micro enterprises cannot be initiated
before the Tribunal. Those disputes as is the case herein are purely
contractual and any affected or aggrieved party to the contract has the right
to file an ordinary civil or commercial suit for redress.
72.Section 5 all the way to section 10 of the Act provides for registration of an
entity under the Act by the Registrar and considerations for registration,
including deregistration. Registration under the Act must be by application
and the Registrar has the power to decline registration or to deregister an
entity under the Act.
73.In this case, neither the applicant nor the interested party have demonstrated
that they are entities which are registered under the Act. Both parties are
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simply described as limited liability companies registered under the
Companies Act. Neither of the two parties filed into court certificates of
registration in the prescribed form under the Act as could have been issued
under section 7 of the Act.
74.The applicant filed its annual audited accounts dated 21/3/20205 showing
that its total equities and liabilities (asset base) is Kshs 5,666,932236 and
share capital of Kshs 200 million. the CR12 issued on 13th November 2025
shows that the nominal share capital is Kshs 212,500,000.
75. Although the interested party claims that the notice of motion is defective
on account of this discrepancy, there is no material or apparent defect that
would render the application defective as the CR 12 at the number and type
of shares (value per share) shows” Ordinary 200,000,000 (Kshs 1.00 each)
and preference 12,500,000(Kshs 1.00 each)” hence the explanation in the
differences noted.
76.Nonetheless, the two figures are still far much more and in excess of what
the Act contemplates, for an entity to be defined as a small and micro
enterprise.
77.Additionally, from the statutory definitions of the small enterprises and
micro enterprises, there is no evidence that the applicant herein falls within
any of those definitions, even assuming that its CR12 had issues as stated by
the interested party.
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78.I reiterate that jurisdiction cannot be conferred by parties and neither can a
tribunal or court of law arrogate itself of jurisdiction that it is devoid of.
Where the Tribunal arrogates itself of jurisdiction, whether parties’ consent
to that jurisdiction or not, this Court’s supervisory role is to check on
excesses of bodies, tribunals, authorities or persons exercising judicial or
quasi-judicial functions, as mandated by Article 165(6) and (7) of the
Constitution.
79.In the end, I find and hold that whether there was another decision by the
Tribunal between the same parties and which the applicant chose not to
appeal is not a bar to the applicant challenging jurisdiction of the Tribunal in
these subsequent proceedings.
80.I am satisfied on the material place before me and upon reading the Act that
the Tribunal was devoid of jurisdiction to entertain the dispute between the
parties hereto.
81.On the question of lack of Board Resolution for the applicant to file these
proceedings, it is important to note that these proceedings emanate from the
Tribunal’s proceedings where the interested party is the applicant while the
applicant herein is the respondent. A respondent who is aggrieved by the
decision of the decision of the Tribunal and elects to approach this Court
cannot be told to go seek the Board Resolution before challenging those
proceedings, especially where it is not demonstrated that their appearance
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before the Tribunal was not challenged on account of want of a Board
Resolution.
82.I agree that Board resolutions are important as stipulated in Order 4 of the
Civil procedure Rules. However, each case must be determined on its
merits.
83.In Ansapar Beverages Limited v Development Bank of Kenya Ltd & 5
Others (HCCC No. 1155 of 2000), the court held that a company must
authorize institution of any suit through a board or general meeting
resolution. In Spire Bank Limited v Land Registrar & 2 Others [2019]
eKLR, the Court of Appeal emphasized that the intention behind Order 4
Rule 1(4) of the Civil Procedure Rules is to prevent unauthorized litigation
on behalf of the corporate entity.
84.In the instant case, the deponent in the affidavits verifying and supporting
the chamber summons and notice of motion are clear that the deponent, the
debt recovery manager of the applicant was authorised by the Board of
Directors to swear the affidavits and there is no contrary evidence from any
Director of the Company challenging authority to institute these proceedings
on behalf of the Company and for its own benefit and to protect its interests.
85.In Mawe Mbili Limited v Equity Bank Kenya Limited & another (Civil
Suit 70 of 2018) [2022] KEHC 150 (KLR) (Commercial and Tax) (17
February 2022) (Ruling), J.N.Mulwa J had this to say concerning lack of
Board resolution to institute suit and I concur:
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“The Plaintiff cited the decisions in Fubeco China Fushun v Naiposha
Company Limited & 11 others [2014] eKLR; Bethany Vineyards
Limited & Another v Equity Bank Limited & 2 Others [2020]
eKLR, Dakianga Distributors Limited v Nicholas Buri Onkeo [2017]
eKLR in support of the position that a board resolution authorizing the
institution of a suit is not a mandatory requirement before filing a suit
in the name of a corporation.
In the Verifying Affidavit that accompanied the Plaintiff’s Plaint filed
herein on 16th February 2018, the deponent Jacqueline Ruth Damon
stated inter alia that she is a director of the Plaintiff Company and that
she instructed the firm of Messrs W.G Wambugu & Co. Advocates to
institute the proceedings herein against the Defendants.
In Arthi Highway Developers Limited v West End Butchery Limited &
6 others [2015] eKLR, the Court of Appeal cited the case of United
Assurance Co. Ltd v Attorney General: SCCA NO. 1 of 1998 where the
Supreme Court of Uganda held that:
“…it was now settled, as the law, that, it does not require a board of
directors, or even the general meeting of members, to sit and resolve to
instruct Counsel to file proceedings on behalf and in the names of the
Company. Any director, who is authorized to act on behalf of the
company, unless the contrary is shown, has the powers of the board to
act on behalf of that Company.”
Page 24 of 27
In Fubeco China Fushun v Naiposha Company Limited & 11 others
[2014] eKLR, Gikonyo J. while dealing with a case where a director’s
powers to authorize the filing of an application on behalf a company
had been challenged, stated that:
“In the case before me, Caroline Wairimu Kimemia is a director of the
Defendant Company and she duly authorized the Advocates on record
to commence this Application. That fact is not denied and I am
surprised the person laying the objection is the Plaintiff and not the
Defendant Company. The Plaintiff has also not presented any material
or affidavit from the other directors denying the authority of Caroline
Wairimu Kimemia as a director in the Defendant Company. As such, I
do not think the Court is in any position to dispute the authority of
Caroline Wairimu Kimemia or the instructions to the advocate on
record to defend the interest of the company. Therefore, in the absence
of evidence to the contrary, I find the affidavits filed to be in order and
the advocate herein to be properly on record for the Defendant.”
From the above authorities, I gather that a director is duly authorized
to act in the interest of a company unless the contrary is shown. In the
instance case, the 2nd Defendant has not tendered any evidence before
the court to show that his co-director Jacqueline Ruth Damon, did not
have the authority to act in any way on behalf of and in the interest of
their company, the Plaintiff herein. Such evidence would have taken
Page 25 of 27
the form of the Plaintiff’s Articles of Association showing that directors
do not have such authority or even a Board Resolution. In any case, the
court is well aware that even where proceedings are started without
proper authority, the same may subsequently be ratified.
The upshot therefore is that it was not mandatory that a board
resolution under seal authorizing the institution of the suit be filed by
the Plaintiff at the commencement of these proceedings. The absence of
the same is therefore not a ground for striking out the Plaintiff’s suit at
this point.”
86.The above decision by my learned sister Judge is sound law and I have
nothing useful to add.
87.In the end, I find the objections by the interested party on account of want of
board resolution to be devoid of merit.
88.On whether judicial review orders sought should issue, in my view, the
applicant has demonstrated that it has no alternative remedy, as it is not a
person entitled to invoke the appellate process under Section 11 of the Act.
Judicial review thus becomes the only available remedy.
89.In the end, I find merit in the application by the applicant which I hereby
allow and make the following orders:
a. An order of prohibition is hereby ordered prohibiting the
respondent herein Micro and Small Enterprises Tribunal from
continuing with any proceedings in Nairobi Micro and Small
Page 26 of 27
Enterprises Tribunal Case No. E001 of 2025 African Herbal
Ingredient Wholesalers Limited versus MyCredit Limited.
b. An order of certiorari is hereby issued removing into this court
and quashing all the proceedings and orders issued by the
respondent herein Micro and Small Enterprises Tribunal in
Nairobi Micro and Small Enterprises Tribunal Case No. E001 of
2025 African Herbal Ingredient Wholesalers Limited versus
MyCredit Limited.
c. I order that each party bear its own costs of the application as the
main issue centered around jurisdiction and the main dispute is
not yet resolved, with the interested party being at liberty to
institute proceedings in court against the applicant for
appropriate remedies.
89.I so order
90.This file is closed
Dated, Signed and Delivered at Nairobi this 10th Day of February, 2026
R.E. ABURILI
JUDGE
Page 27 of 27
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