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Total Steward Services LTD v Bar Ne xt Door Ventures LTD (Arbitration Cause E084 of 2024) [2025] KEHC 4065 (KLR) (Commercial and Tax) (27 March 2025) (Ruling)

Total Steward Services LTD v Bar Ne xt Door Ventures LTD (Arbitration Cause E084 of 2024) [2025] KEHC 4065 (KLR) (Commercial and Tax) (27 March 2025) (Ruling)
Citation
Total Steward Services LTD v Bar Ne xt Door Ventures LTD [2025] KEHC 4065 (KLR)
Media Neutral Citation
[2025] KEHC 4065 (KLR)
Court
High Court
Court station
High Court at Nairobi (Milimani Commercial Courts)
Outcome
Dismissed
Case number
Arbitration Cause E084 of 2024
Judges
F Gikonyo
Judgment date
27 March 2025
Language
English
Type
Judgment
Original source file
Download DOCX (34.9 KB)
Date published
03 April 2025
Case action
Ruling
Court division
Commercial and Tax
Filing county
Nairobi
Order
i. The upshot is that the prayer seeing an extension to apply to set aside the award dated 10th September 2024 is declined. ii. Parties to take directions on the hearing and disposal of the remaining prayers in the motion.
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Extension of Time under S.35 of Arb. Act
1.Before me is a motion on notice dated 30th January 2025, which is expressed to be brought under Article 159 of the Constitution and Section 35 of the Arbitration Act.
2.The motion seeks extension of time to apply under S.35 of the Arbitration Act to set aside the arbitral award dated 10th September 2024 and the additional arbitral award dated 8th November 2024.
3.The motion is supported by the affidavit sworn by the respondent’s director, Raphael Mbaya Murangiri.
4.The grounds for applying are: that the respondent intends to oppose the enforcement of the award; that the respondent did not have an opportunity to instruct its advocates as he was out of the country; that there was a change of advocates and the new advocates could not reach the respondent both on phone and email; that the enforcement would prejudice it, violate its right to a fair hearing; and that it would not serve the ends of justice.
Response
5.The applicant/ respondent opposed the motion through a replying affidavit sworn by its managing director, Pascal Omondi on 21st November 2024 and written submissions dated 5th March 2025.
6.Mr. Omondi deposed that the final award was published on 10th September 2024. Under Section 35 (3) of the Arbitration Act, the last day for applying to set aside the award was 10th December 2024. The application for setting aside has been filed out of the three-month window and is therefore incompetent and bad in law.
7.Mr. Omondi dismissed the explanation that the delay in seeking an extension was due to the respondent’s director being out of the country, which allegedly prevented giving instructions. He asserted that since the respondent is a separate and independent legal entity, with other directors and shareholders, the absence of one is immaterial. He also pointed out that the air ticket marked “RMM3”, exhibited by the respondent, showed that the director travelled on 28th December 2024, after the statutory window had already lapsed.
8.The applicant/ respondent argued that an extension of time to apply to set aside an award is not provided for under the law. It cited Sections 10 and 35 of the Arbitration Act. It also relied on Neelcon Construction Services Limited v Kakamega County Assembly Service Board Sued on Behalf of Kakamega County Assembly (Miscellaneous Application E060 of 2022) [2023] KEHC 20003 (KLR) (Commercial And Tax) (14 July 2023) (Ruling) and Will Developers and Construction Limited v Government of The Republic of Kenya Permanent Secretary, Vocational Training, Ministry of Education, Science and Technology & Another [2021] KEHC 6842 (KLR)
9.The applicant further contended that even if the Act allowed any extension of time, the present application is not based on plausible reasons.
Analysis and Determination
10.The question before the court is:Whether the court should extend time to allow the respondent/ applicant should to file an application under section 35 of the Arbitration Act to set aside the arbitral award dated 10th September 2024 and the additional arbitral award dated 8th November 2024.
11.A party may apply to set aside an arbitral award under Section 35 of the Arbitration Act. Section 35(3) of the Arbitration Act provides as follows:-“(3)An application for setting aside the arbitral award may not be made after 3 months have elapsed from the date on which the party making that application had received the arbitral award, or if a request had been made under section 34 from the date on which that request had been disposed of by the arbitral award”
12.The applicant/ respondent argued that an extension of time to apply to set aside an award is not provided for under the law. There are two schools of thought on this.
13.In Will Developers and Construction Limited v Government of The Republic of Kenya Permanent Secretary, Vocational Training, Ministry of Education, Science and Technology & Another [2021] KEHC 6842 (KLR) cited by the applicant, Majanja J, held that:-“
24.It must now be clear that the Court, under section 35 or any other provision of the Arbitration Act, does not have jurisdiction to extend the time limited for filing an application for setting aside the award. To imply such a provision permitting the court to extend would amount to re-writing the Arbitration Act, when its own provisions do not permit any manner of interference of the arbitral process or the award except as specified therein. Since the court lacks jurisdiction to proceed any further, no purpose will be served by examining the reason why the Applicant filed its application to set aside the award late.”
14.Mwita J, in Nairobi City County v Kenya Commercial Bank Limited (Miscellaneous Application E174 of 2021) [2022] KEHC 73 (KLR) (Commercial and Tax) (4 February 2022) (Ruling) stated that: -“Although the section does not state that the court may enlarge time within which to file such an application, whether or not to extend time is a matter within the discretion of the court which must however be exercised judicially, taking into account the circumstances of each case.”
15.The Court of Appeal in University of Nairobi v Multiscope Consulting Engineers [2020] eKLR noted that an issue raised by the applicant on the interpretation of section 35(3) was a jurisprudential issue that ought to be addressed.
16.The Court of Appeal in Ezra Odondi Opar v Insurance Company of East Africa Ltd [2020] eKLR where one of the grounds of appeal was failing to appreciate that the application dated 9th August 2015 to set aside the arbitral award was filed out of time, observed as follows: -“
24.In those circumstances, and particularly in view of the direction by Kubo, J. that the issue of costs should be concluded before any challenge to the award could be mounted, we take the view that Chemitei, J. was entitled to accede to the respondent’s application to, in effect extend the time for filing the subsequent application for setting aside the arbitral award. In order to accord with the ruling of Kubo, J. the time for applying to set aside the award under Section 35 of the Arbitration Act, could not, practically, be reckoned from the date the respondent received the award, as dictated by Section 35(3) of the Arbitration Act.”
17.Section 35 of the Arbitration Act, being an existing law, ‘shall be construed with the alterations, adaptations, qualifications and exceptions necessary to bring it into conformity with this Constitution.’ Clause 7 of Sixth Schedule, Transitional and Consequential Provisions of the Constitution.
18.In accordance with the foregoing instructions, interpretation of section 35 of the Arbitration Act should not be oblivious of the need for the broader realization of the right to access to justice (art.48 of the Constitution), and the right to fair hearing (art.50 of the Constitution) by the parties. As such, exercise of discretion by a court of law to extend time to apply under section 35 of the Arbitration Act is neither forbidden nor a sacrilege.
19.However, arbitration is one of the alternative forms of dispute resolution under article 159(2)(c) of the Constitution of which parties, out of their agreement constitute, set procedures and converge to. These mechanisms are expected, inter alia, to be expeditious in order to accord with the constitutional principle that; justice shall not be delayed. Art.159(2)(b) of the Constitution. Thus, evaluation of an application such as this, is an act of judicial balancing of competing rights of the parties; but guided by yet another principle of justice that: the purpose and principles of this Constitution shall be protected and promoted. Art. 159(2)(e) of the Constitution. Therefore, a party who has constituted, converged to, and participated in the arbitral process, should have a very good and lawful reason to get extension of time to apply under section 35 of the Arbitration Act.
20.Has the respondent/ applicant explained to the satisfaction of the court, the failure to file an application under section 35 of the Arbitration Act as to attract exercise discretion in its favour for extension of time?
21.The following are the relevant consideration in an application for extension of time: as per the Supreme Court in Nicholas Kiptoo Korir Arap Salat v Independent Electoral & Boundaries Commission & 7 others, [2014] eKLR, that: -“
1.Extension of time is not a right of a party. It is an equitable remedy that is only available to a deserving party at the discretion of the court;
2.A party who seeks for extension of time has the burden of laying a basis to the satisfaction of the court;
3.Whether the court should exercise the discretion to extend time, is a consideration to be made on a case to case basis;
4.Whether there is a reasonable reason for the delay. The delay should be explained to the satisfaction of the court;
5.Whether there will be any prejudice suffered by the respondents if the extension is granted;
6.Whether the application has been brought without undue delay; and
7.Whether in certain cases, like election petitions, public interest should be a consideration for extending time.”
22.The arbitral awards are dated 10th September 2024 and 8th November 2024. The deadlines for applying to set them aside fell on 9th December 2024 and 8th March 2025.
23.The present application was filed on 30th January 2025, about 52 days late. This is inordinate delay.
24.What is the explanation for the delay that has been provided?
25.The explanation for the delay is that the respondent had changed advocates and that the new advocates were unable to obtain instructions from the respondent’s director who was out of the country.
26.This explanation defies easiness with which information flow or communication is had on the basis of advanced technological and digital mediums. The explanation could pass the muster in the days of yore before the advanced telecommunication and digital communication era the world is experiencing today.
27.In addition, the respondent disputed the explanation provided as the director travelled on 28th December 2024, after the statutory window had already lapsed.
28.I have looked at the air ticket marked “RMM3”, exhibited by the applicant; it shows that the director travelled on 28th December 2024. Making the explanation inappropriately pleaded. The claim of the director’s absence as the cause for the failure to receive instructions to apply under section 35 of the Arbitration Act is incompatible with reasonable explanation as he travelled from the country after the deadline to apply had lapsed rendering it not plausible explanation for the delay. It is sheer exhibition of an indolent suitor, and a case of: delay is an ally of the indolent.
29.Accordingly, I am not persuaded that the respondent has met the threshold for the grant of an extension to apply under section 35 of the Arbitration Act. Nonetheless, an opportunity is provided in section 37 of the Arbitration Act.
Disposal
30.The upshot is that the prayer seeing an extension to apply to set aside the award dated 10th September 2024 is declined.
31.Parties to take directions on the hearing and disposal of the remaining prayers in the motion.
DATED, SIGNED AND DELIVERED THROUGH MICROSOFT TEAMS ONLINE APPLICATION THIS 27TH DAY OF MARCH, 2025.-------------------------F. GIKONYO MJUDGEIn the presence of: -Maina for ApplicantsMutea for RespondentCA - Godfrey
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