In Re Garnets Mining Co Ltd [1978]eKLR | ||
Winding-up Cause 12 of 1977 | 23 Nov 1978 |
Alister Arthur Kneller
High Court at Nairobi (Milimani Law Courts)
Re Garnets Mining Co Ltd
In Re Garnets Mining Co Ltd [1978]eKLR
Re Garnets Mining Co Ltd
High Court, at Nairobi 21st, 22nd December 1977, 20th January8th, 9th February 5th, 6th, 10th-12th, 14th , 17th-19th, 21st July, 23rd November 1978
Kneller J
Winding-up Cause No 12 of 1977
Winding-up – winding-up by Court – circumstances in which order may be made – just and equitable – criteria – loss of confidence in management – Companies Act (Cap 486), section 219(f).
Winding-up – winding-up by Court – petitioner – need for petitioner to come to Court with clean hands – petition relying on just and equitable ground.
Winding-up – winding-up by Court – circumstances in which order may be made – just and equitable – criteria – company a quasi-partnership – Companies Act (cap 486), section 219(f).
Whether or not a company should be wound up by the Court on the ground that it is just and equitable to wind it up under section 219(f) of the Companies Act is a matter of discretion. The court’s discretion in this respect is wide and must be exercised judicially. Each case depends on its own facts as they are at the time of the hearing; but, generally, where a petitioner can show that he has lost confidence in the management of the company because it has a lack of probity, the court’s discretion (in the absence of special circumstances) is likely to be exercised in his favour.
A petitioner seeking to rely on just and equitable grounds must approach the Court with clean hands.
Re Blériot Manufacturing Air Craft Co (1916) 32 TL R 253, Baird v Lees 1924 SC 83, Loch v John Blackwood Ltd [1924] AC 783, Davis & Co Ltd v Brunswick (Australia) Ltd [1936] 1 All ER 299, Re Straw Products Pty Ltd [1942] VLR 222, Re Fildes Bros Ltd [1970] 1 WLR 592, Ebrahimi v Westbourne Galleries Ltd [1973] AC 360 and Cookson v Knowles [1978] 2 WLR 978 Applied.
Where a company is a quasi-partnership, even if all the creditors or shareholders are not entitled to participate in the conduct of the company’s business, the company may be wound up by the Court under section 219(f) of the Companies Act on the ground of its being just and equitable, in circumstances where it would be appropriate to dissolve a partnership; but this would not be the case where the cause of complaint arises from the valid exercise by the other members of their powers under the articles of association.
Symington v Symington’s Quarries Ltd 1905 8 F 121, Re Yenidje Tobacco Co Ltd [1916] 2 Ch 426, Loch v John Blackwood Ltd [1924] AC 783, Thomson v Drysdale 1925 SC 311, Tench v Tench Bros [1930] NZLR 403, Re Davis and Collett Ltd [1935] Ch 693, Re Cuthbert Cooper & Sons Ltd [1937] Ch 392, Re Straw Products Pty Ltd [1942] VLR 222 and Re Wondoflex Textiles Pty Ltd [1951] V L R 458 applied
Cases referred to in judgment:
- A&BC Chewing Gum Ltd, Re [1975] 1 WLR 579, [1975] 1 All ER 1017.
- Alexander v Automatic Telephone Co [1900] 2 Ch 56, 69 LJ Ch 428, 82 LT 400, CA.
- Baird v Lees 1924 SC 83.
- Bellador Silk Ltd, Re [1965] 1 All ER 667.
- Bentley-Stevens v Jones [1974] 1 WLR 638, [1974] 2 All ER 653.
- Blériot Manufacturing Air Craft Co, Re (1916) 32 TLR 253.
- Busland v Earle [1902] AC 83.
- Campbell v Rothwell (1877) 47 LJQ 144, 38 LT 33.
- Charles Forte Investments Ltd v Amanda [1964] Ch 240, [1963] 3 WLR 662, [1963] 2 All ER 940, CA.
- Chesterfield Catering Co Ltd, Re [1977] Ch 373, [1976] 3 WLR 879, [1976] 3 All ER 294.
- Clemens v Clemens Bros [1976] 2 All E R 268.
- Cohen, Re [1924] 2 Ch 515, 94 LJ Ch 73, CA.
- Cookson v Knowles [1979] AC 556, [1978] 2 WLR 978, [1978] 2 All ER 604, HL.
- Cumberland Holdings Ltd, Re [1976] 1 ACLR.
- Cuthbert Cooper & Sons Ltd, Re [1937] Ch 392, [1937] 2 All ER 466.
- Daniels v Daniels [1978] Ch 406, [1978] 2 WLR 73, [1978] 2 All ER 89.
- Daslo-Stolan Mining & Financial Corporation Ltd, Re [1910] WN 13.
- Davis & Co Ltd v Brunswick (Australia) Ltd [1936] 1 All ER 299, PC.
- Davis and Collett Ltd, Re [1935] Ch 693, 104 L J Ch 340, 153 LT 329.
- Davis Investments (East Ham) Ltd, Re [1961] 1 WLR 1396, [1961] 3 All ER 926, CA.
- Diamond Fuel Co, Re (1879) 13 Ch D 400, 49 LJ Ch 301, 41 LT 779, CA.
- Ebrahimi v Westbourne Galleries Ltd [1973] AC 360, [1972] 2 WLR 1289, [1972] 2 All ER 492, HL.
- Expanded Plugs Ltd, Re [1966] 1 WLR 514, [1966] 1 All ER 887.
- Fildes Bros Ltd, Re [1970] 1 WLR 592, [1970] 1 All ER 923.
- Foss v Harbottle (1843) 2 Hare 461.
- German Date Coffee Co, Re (1882) 20 Ch D 169, 51 LJ Ch 564, 46 LT 327, CA.
- Gold Hill Mines, Re (1883) 23 Ch D 210, 49 LT 66, CA.
- Hang (Sverre) v Buhemba Mines Ltd (1953) 20 EA CA 28.
- Haven Gold Mining Co, Re (1882) 20 Ch D 151, 51 L J Ch 242, 42 LT 322, CA.
- Hawken (S A) Ltd, Re [1950] 2 All E R 408.
- Haycraft Gold Reduction and Mining Co, Re [1900] 2 Ch 230, 69 LJ Ch 497, 83 LT 166.
- K/9 Meat Supplies (Guildford) Ltd, Re [1966] 1 WLR 1112, [1966] 3 All ER 320.
- Kitson & Co Ltd, Re [1946] 1 All ER 435, CA.
- Leadenhall General Hardware Stores Ltd, Re (1971) 115 SJ 202.
- Lewis v Haas 1970 SLT (Notes) 67.
- Loch v John Blackwood Ltd [1924] AC 783, 93 LJP C 257, 131 L T 719, PC.
- London and Manchester Industrial Association, Re (1875) 1 Ch D 466.
- London Suburban Bank, Re (1871) 6 Ch App 164, 40 LJ Ch 774.
- Lundie Bros Ltd, Re [1965] 1 WLR 1051, [1965] 2 All ER 692.
- Mason Bros Ltd, Re (1891) 12 NSW Eq 183.
- Meyers v Cassidy (1913) 17 CLR 90, High Court of Australia.
- Modern Retreading Co Ltd, Re [1962] EA 57, High Court of Tanzania.
- Mohamed Mitha v Ibrahim Mitha [1967] EA 575, High Court of Uganda.
- Mozley v Alston (1847) 1 Ph 790, 16 LJ Ch 217, 9 LTO S 97.
- New Callao Ltd, Re (1882) 47 LT 175.
- Newman and Howard Ltd, Re [1962] Ch 257, [1961] 3 WLR 192, [1961] 2 All ER 495.
- North End Motels (Huntly) Ltd, Re [1976] NZLR 446.
- Oakbank Oil Co v Crum (1882) 8 App Cas 65, 48 L T 537, H L.
- Othery Construction Ltd, Re [1966] 1 WLR 69, [1966] 1 All ER 145.
- Peruvian Amazon Co Ltd, Re (1913) 29 TLR 384.
- Phillips v Manufacturers’ Securities Ltd (1917) 86 LJ Ch 305, 116 LT 290, CA.
- Rhoprops Ltd, Ex parte; Re Piras Garden Properties (Pvt) Ltd 1953 (3) SA 630.
- Rica Gold Washing Co, Re (1879) 11 Ch D 36, 40 Lt 531, CA.
- Smith and Fawcett Ltd, Re [1942] Ch 304, [1942] 1 All ER 542, CA.
- Spackman, Ex parte (1899) 1 Mac & G 170, 18 L J Ch 261, 13 LTOS 358, 41 ER 1229.
- Straw Products Pty Ltd, Re [1942] VLR 222.
- Suburban Hotel Co, Re (1867) 2 Ch App 737, 36 LJ Ch 710, 17 LT 22.
- Symington v Symington’s Quarries Ltd 1905 8 F 121.
- Taldua Rubber Co Ltd, Re [1946] 2 All ER 763.
- Tench v Tench Bros [1930] NZLR 403.
- Thomas Edward Brinsmead & Sons, Re [1897] 1 Ch 406, 66 L J Ch 290, 76 LT 100, CA.
- Thomson v Drysdale1925 SC 311.
- West Surrey Tanning Co, Re (1866) LR 2 Eq 737.
- Wondoflex Textiles Pty Ltd, Re [1951] VLR 458.
- Yenidje Tobacco Co Ltd, Re [1916] 2 Ch 426, 86 LJ Ch 1, 115 LT 530, CA.
Petition
Mrs Beth Wambui Mugo petitioned the Court in Winding-up Cause No 12 of 1977 to wind up Garnets Mining Co Ltd. The company opposed the petition. In the course of his judgment, Kneller J described the petitioner as the daughter of Mr James Muigai, the brother of the late President Kenyatta. She was married to Mr Nicholas Mugo, the Ambassador to Ethiopia and later to various countries in Europe.
Advocates
P Le Pelley and KA Fraser for the Petitioner.
PK Muite for Garnets.
Cur adv vult.
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