Automated Summary
Key Facts
The case involves Savings and Loan Kenya Limited and Kenya Commercial Bank Limited (applicants) seeking an extension to register two charges against S.A.M. Company Limited (respondent) under the Companies Act. The applicants had disbursed Kshs. 71 million to the respondent via a charge dated October 23, 2008, and a second charge on October 26, 2009. The delay in registration was due to the directors of the chargor being out of the country until January 2010, after the statutory 42-day period had expired. The court granted a 40-day extension for registration of the charges.
Issues
The court was asked to determine if the applicants (Savings and Loan Kenya Limited and Kenya Commercial Bank Limited) were entitled to an extension of 40 days to register charges against S.A.M. Company Limited, citing the directors' overseas absence as the cause for missing the 42-day statutory deadline under Section 96 of the Companies Act.
Holdings
The court granted an extension of 40 days to register the charges under section 96 of the Companies Act, citing the applicants' precarious security position due to non-registration. The charges relate to land reference 37/37, dated 30th April 2008 (Charge a) and 26th October 2009 (Charge b), involving SAVINGS AND LOAN KENYA LIMITED and KENYA COMMERCIAL BANK LIMITED as lenders, and S.A.M. COMPANY LIMITED as the chargor.
Remedies
The court granted an extension of 40 days for the registration of the charge and second charge under Section 96 of the Companies Act.
Legal Principles
The court granted an extension of 40 days for registration of charges under Section 96 of the Companies Act, citing exceptional circumstances including the directors' absence and the statutory period having lapsed.
Cited Statute
- Companies (High Court) Rules L.N. 312/1964
- Companies Act, CAP 486
Judge Name
Muga Apondi
Passage Text
- I hereby direct that the time for registration under section 96 of the Companies Act of the charge and second charge whose particulars are given herewith, be extended by 40 days from today's date.
- The applicants are in a precarious position as far as their security is concerned due to the non registration of the two charges... the statutory period of 42 days had already lapsed.