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|Case Number:||Civil Suit 206 of 2011|
|Parties:||GILBERT CHEGE v KENYA INSTITUTE OF APPLIED SCIENCE,JACKSON ADEDE IRAVUNAH & EVELYN IRAVUNAH|
|Date Delivered:||07 Dec 2011|
|Court:||High Court at Eldoret|
|Citation:||GILBERT CHEGE v KENYA INSTITUTE OF APPLIED SCIENCE & 2 Others  eKLR|
|Disclaimer:||The information contained in the above segment is not part of the judicial opinion delivered by the Court. The metadata has been prepared by Kenya Law as a guide in understanding the subject of the judicial opinion. Kenya Law makes no warranties as to the comprehensiveness or accuracy of the information|
IN THE HIGH COURT OF KENYA
CIVIL SUIT NO. 206 OF 2011
The 2nd defendant, Jackson Adede Iravunah and the 3rd defendant, Evelyn Iravunah, have applied, by Chamber Summons dated 16th September, 2010 for one order namely that their names be struck out for being improperly enjoined in this suit. They contend that as directors of the 1st defendant they cannot be sued in their own names for claims against the 1st defendant.
The plaintiff, in his plaint, describes the 1st defendant as a private institute having a common seal with registered offices in Nairobi and Eldoret. In paragraph 5 of the same plaint, he avers that he entered into a contract with the defendant to buy hostel business from the 1st defendant. In the agreement exhibited by the plaintiff, the only parties thereto are the plaintiff and the 1st defendant. The 2nd and 3rd defendants are mentioned nowhere.
It is plain that the plaintiff does not appreciate the separate corporate identity of the 1st defendant hence his contention that he did not know that he was dealing with the 2nd and 3rd defendants as the directors of the 1st defendant yet the agreement of sale which is the foundation of his claim is in the name of the 1st defendant as the only seller of the hostel business. It is a basic principle of Company Law that a company has a distinction and separate personality from its shareholders and directors even where the directors are also the shareholders. (See the precedent setting case of Salomon -Vs- Salomon and Company Limited  AC 22.) As a separate legal entity, its property is distinct from that of its shareholders and directors. It follows therefore that if the company herein sold its property or business to the plaintiff, it is only proper that it bears the consequences. In the premises, I find and hold that the 2nd and 3rd defendants, as directors of the 1st defendant have no capacity to be sued for wrongs committed by the 1st defendant and have therefore improperly been joined in this suit.
I accordingly allow the 2nd and 3rd defendants’ application dated 10th September, 2010 and order that the two be and are hereby struck out of this suit.
As the plaintiff appears to have dealt with the two, the proper order on costs is that each party bears its own costs.