Imperial Bank Limited (In Receivership) & another v Popat & 18 others (Civil Appeal E395 of 2017) [2025] KECA 1013 (KLR)
The bottom line
#Kenya's Court of Appeal confirmed that accusing a law firm of conflict of interest is not enough - you must prove actual confidential information will likely be misused to bar them.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Under what circumstances will a court bar an advocate from acting for a party on grounds of conflict of interest?
- 2.Whether the firms of Ahmednasir Abdikadir & Co. Advocates, Muriu Mungai & Co Advocates (Mr. Njoroge Nani Mungai) and Coulson Harney Advocates were conflicted by reason of past engagements, panel membership or listing as legal advisors of the 1st appellant, such that they should be barred from acting for the respondents in HCCC No. 392 of 2016
- 3.Who bears the burden of establishing a conflict of interest and what evidence suffices to justify disqualification of an advocate
Key legal issues
#Test for disqualifying an advocate on grounds of conflict of interest
The court adopts the Rakusen/Cozens-Hardy MR test: a court will intervene only where real mischief and real prejudice will, in all human probability, result if the advocate is allowed to act; each case is a matter of substance on its facts.
The court traced the doctrine from Rakusen v Ellis, Munday & Clarke through Re A Firm of Solicitors, Supasave Retail, King Woolen Mills, Delphis Bank and Jopa Villas, confirming that the right to counsel of choice under Article 50 is only displaced where there is real risk of misuse of confidential information causing real prejudice. Mere allegation of past acting or panel membership does not meet the threshold.
Effect of being listed as legal advisor or on a panel of advocates
Listing as a legal advisor or empanelment alone does not justify disqualification; the objecting party must show the advocate actually gave advice on the subject matter from which the dispute arises.
The court held that for a financial institution with multifaceted undertakings, the mere fact of instruction or panel membership is insufficient. The objector must show specific instructions were given and that the confidential information gained was connected with the issues at hand and likely to be used deliberately or inadvertently to the client's detriment in the proceedings.
Burden and standard of proof in conflict-of-interest applications
The burden rests on the party propounding disqualification to establish the factual basis for the apprehension of conflict; particularity as to the confidential information is required, and mere suspicion is insufficient.
Relying on Prince Jefri Bolkiah v KPMG, Re a Firm of Solicitors and Albert Chaurembo Mumba, the court held that the applicant must show the advocate possesses confidential information not consented to be disclosed, that is or may be relevant to the new matter. Vague, unsubstantiated allegations or generalised assertions of privy to information during a fraud period fall short of the required evidence.
Application to the three firms
None of the three firms was shown to be conflicted: no specific instances of conflict were pleaded against Ahmednasir Abdikadir & Co; no specific transaction involving Muriu Mungai & Co was identified as the subject of the suit; and the Coulson Harney letter of good standing was general vouching, not evidence of relevant confidential information.
The court reviewed the supporting affidavit of David Kiptoo and the letter of good standing of 23rd February 2015, finding the appellants had not shown which confidential information was imparted or how it related to the issues in HCCC No. 392 of 2016. Post-receivership representation of shareholders and intention to call advocates as witnesses rested on mere averment.
Legal principles established
#- There is no general rule that an advocate cannot act for one party and later for the opposite party; the test is whether real mischief or real prejudice will, in all human probability, result if the advocate is allowed to act.
- Mere listing of an advocate as legal advisor or membership of a client's panel of advocates is not a sufficient ground for disqualification; the objecting party must show specific instructions whose confidential information is connected with the issues in the suit and likely to be used to the client's detriment.
- The burden lies on the party seeking to bar an advocate from acting to establish the factual basis for the apprehension of conflict of interest; general averments are insufficient.
- Removal of an advocate from acting for a party is an extraordinary and drastic remedy to be contemplated only in the most extraordinary circumstances.
- Each case on conflict of interest must be decided on its own facts as a matter of substance, not on the mere proof of former acting for a client.
Court orders
#- 1.The appeal is dismissed with costs
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
Wrote the judgment
Wrote the judgment
- On appeal from
- High Court of Kenya at Nairobi
- High Court Civil Case No. 392 of 2016 (ruling dated 17th January 2017)
- Jurisdiction invoked
- First appeal to the Court of Appeal from the High Court under the Court of Appeal's appellate jurisdiction (Article 164 of the Constitution / Appellate Jurisdiction Act - not expressly stated in the judgment)
Relief refused
#Disqualification of the firms of Ahmednasir Abdikadir & Co. Advocates, Muriu Mungai & Co Advocates and Coulson Harney Advocates from acting for the respondents
The appellants failed to demonstrate real mischief and real prejudice; general averments and mere suspicion that confidential information was imparted do not justify the extraordinary remedy of barring an advocate
Costs
The appeal was dismissed with costs to the respondents.
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
In the premises, this appeal fails and is dismissed with costs.
It is so ordered.
There is otherwise no general rule that an advocate cannot act for one party in a matter and then act for the opposite party in subsequent litigation.
The mere fact that it did instruct an advocate or that an advocate is in its panel of advocates is not a sufficient ground to disqualify an advocate.
To bar an advocate from representing a client thereby restricting that client's right to legal representation, more than mere suspicion is required.
removal of an Advocate from acting for a party in proceedings was an extraordinary and drastic remedy to be contemplated only in the most extraordinary circumstances
Evidence of confidential information being imparted in the advocate ought to be adduced followed by reasonable belief that the same is likely to be used against the client to the advantage of the other party.
Issues in the judgment
#Internal inconsistency in the pleaded quantum of loss: the judgment states Kshs 42.2 billion in the narrative of the plaint but the grounds of appeal refer to Kshs 42.4 billion.
The judgment refers to the 19th respondent as a body corporate incorporated under the Central Bank of Kenya Act, while the appellants' submissions refer to the Prudential Guidelines as 'the 3rd appellant's Prudential Guidelines' and later 'the 19th respondent's Prudential Guidelines', an apparent mix-up in party identification.
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (1)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
Cite this brief
#Cite this brief
Caselaw, "Imperial Bank Limited (In Receivership) & another v Popat & 18 others (Civil Appeal E395 of 2017) [2025] KECA 1013 (KLR)", Case Analysis (2025). Court of Appeal Civil Appeal arising from High Court Civil Case No. 392 of 2016 (Nairobi). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2025/1013/eng@2025-05-30
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.