Whether the Preliminary Objection is merited?
14.The Plaintiff herein has raised the Preliminary Objection against the application seeking for orders of stay of proceedings and referral to arbitration on the grounds that the Defendant was obligated to simultaneously file the Memorandum of Appearance with the said application. The Defendant therefore having failed to adhere to the timelines as set out in Section 6(1) of the Arbitration Act No. 4 of 1995 waived its right to apply and had acquiesced itself to the jurisdiction of this court. The Plaintiff further contended that failure to so do rendered the application incompetent.
15.The Defendant was of the view that while it had filed a Memorandum of Appearance it had not taken any further steps neither had it acknowledged jurisdiction of the court by filing a defence; that the section allowed for a referral to be made either at the time of entering appearance, alongside or before filing of the defence and that the section does not impose timelines. Therefore, it had not waived or vitiated its rights to make the application for stay of proceedings and referral to arbitration.
16.The Section 6(1) of the Arbitration Act provides as follows: -(a)that the arbitration agreement is null and void, inoperative or incapable of being performed; or(b)that there is not in fact any dispute between the parties with regard to the matters agreed to be referred to arbitration.”
17.This court is alive to the legions of decisions on Section 6(1) of the Arbitration Act on the fact of filing the summons ‘not later than the time when that party enters appearance or otherwise acknowledges the claim against which the stay of proceedings is sought.’
18.But in the case of Niazsons (K) Limited vs China Road & Bridge Corporation Kenya (supra) which decision has been described as forward thinking the Court of Appeal held that an applicant wishing to take benefit of the section is obliged to apply after entering appearance and before delivering any pleading as long as an application under Section 6(1) of the Act is brought promptly; the court went on to hold that the court is obliged to consider whether the applicant had taken any steps in the proceedings other than the steps allowed by the section.
19.The Preliminary Objection raised by the Plaintiff is on jurisdiction on whether the Defendant has waived its right to invoke the Arbitration Clause to have the matter referred to Arbitration. It is trite law that a Preliminary Objection must raise a point of law based on ascertained facts that are not in dispute and not on evidence; whereby these facts when raised in the objection may result in the complete disposal of the suit. This was held in the renowned case of Mukisa Biscuit Manufacturers Ltd v Westend Distributors Ltd  EA 696; where it was held as follows;
20.This Court is guided and associates itself with the Court of Appeal decision of Naizsons (supra) and going by the findings therein, the section permits a Defendant to apply for a stay of proceedings or reference of the proceedings to arbitration either at the time of entering appearance or at any time before filing pleadings or at any time before taking any steps in the proceedings. All the Defendant must do is to bring the application promptly.
21.Guided by the said decision this court is satisfied that the Defendant herein entered appearance and before filing any pleadings or taking any further steps after sixteen (16) days had lapsed promptly filed the summons seeking stay of the proceedings and reference to arbitration. This court is further satisfied that the Application is not incompetent and that it is properly before the court.
22.The upshot is that the Preliminary Objection is found to be devoid of merit.