Pamela Akora Imenje v Akora ITC International Ltd & Another

Reported by: PAUL N. MUSYIMI

CASE DETAILS

COURT: High Court, at Milimani

CASE NO: Civil Suit No. 368 of 2005

JUDGE: Waweru J

DATE: 17^th August, 2007

 

CASE OUTLINES

Arbitration-application for stay of proceedings-Section 6(1) of the Arbitration Act, 1995-plaintiff filing suit in breach of articles of association-articles providing for mandatory settlement of disputes by arbitration- whether the Plaintiff can apply under section 6(1) for stay of proceedings and reference to arbitration

 

Civil Practice and procedure-striking out suit-the Defendant urging striking out of suit in submissions against an application-whether striking out order may be granted without a formal application for it on the court record

 

CASE SUMMARY

The ruling reported dealt with the following two issues:

1. Whether the Plaintiff can apply for stay of proceedings under section 6(1) of the Arbitration Act, 1995;
2. Whether an order striking out the suit can be granted without a formal application in the court record.

Held:

The court held as follows on the foregoing issues:

1. From the wording of section 6(1) of the Arbitration Act, 1995, it is clear that it is available only to the defendants.
2. An order striking out the suit is too drastic in nature to be granted without a formal application on the record of the court.

CASE NOTES

The court was ruling on an application by plaintiff under section 6(1) of the Arbitration Act seeking stay of the proceedings and reference to arbitration dated 12^th October 2005.

 

Apparently the Plaintiff, a member of the Defendant Company, had filed the instant suit in default of the Company's articles of association. The Articles of association provided mandatory settlement of disputes by arbitration. The Plaintiff failed to invoke the method provided by the articles and was now, through the vehicle of the instant application, seeking to have recourse to section 6(1) of the arbitration to refer the matter to arbitration.

 

The Plaintiff cited as the main ground for the application the fact that the Defendants had neither entered appearance nor filed defence in the suit.

 

On their part, the Defendants objected the entire suit stating that the same was bad in law and that it constituted abuse of the process of the court given that the articles of association of the 1^st Defendant provided for a mandatory mode of settlement of disputes by arbitration which the Plaintiff had failed to invoke. The Defendants therefore urged the court to strike out the entire suit.

 

The judge ruled that the Plaintiff's application was misconceived as having chosen to file a suit instead of invoking the arbitration clause in the articles of association of the 1^st Defendant; she could not purport to later have recourse to section 6(1) of the Arbitration Act. The court held that from their wording, the provisions of section 6(1) of the Arbitration Act, 1995 is available only to the defendants. Therefore, the Plaintiff having made her bed by filing the suit, she had to lie by standing or falling by it. The court therefore dismissed the Plaintiff's application with costs.

 

The court, however, avoided striking the entire suit in limine as the Defendants had urged in their submissions. In this, it cited the fact that no formal application was on record for the same. The court held that the order striking out the suit was too drastic in nature to be granted without a formal application on the record of the court.