Njenga v Registrar of Companies & another (Civil Appeal 26 of 2020) [2025] KECA 1672 (KLR)
The bottom line
#Kenya's Registrar of Companies can refuse to process disputed company share filings without a hearing, and courts won't overturn such refusals as decisions.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the 1st respondent acted ultra vires their powers under Section 844 of the Companies Act
- 2.Whether the 1st respondent breached the rules of natural justice
Key legal issues
#Whether the registrar acted ultra vires Section 844 of the Companies Act
No. Section 844 empowers the registrar to correct documents that appear incomplete or internally inconsistent, and the registrar acted within statutory authority in refusing to process a disputed application and maintaining the records.
The court read Section 844 as clothing the registrar with authority to correct incomplete or internally inconsistent documents. Faced with the disputed application of 16th October 2019 for 300 additional shares, the registrar exercised due diligence by verifying the transaction with the other director, who disowned it. The registrar's response was measured, not capricious. The court held the action was a refusal to approve an increase based on unverifiable documentation, not an unlawful reduction of established shares.
Whether there was a decision amenable to quashing by certiorari
No. The impugned action was a refusal to approve a share increase based on questionable documentation, not a decision to reduce the appellant's shares.
The court drew what it called a crucial distinction between a decision to reduce shares and a refusal to approve an increase pending verification. Since certiorari lies only against a decision, and no decision to reduce was made, the supervisory jurisdiction could not be invoked. The court found the appellant sought to use judicial review to compel the registrar to accept disputed documentation without verification, circumventing her statutory duty to ensure record accuracy.
Whether the rules of natural justice were breached
No breach. The hearing right attaches to adverse decisions affecting established rights; the registrar's action maintained the status quo.
The court held that the right to be heard applies when an adverse decision affecting established rights is being made. Here the registrar was not reducing the appellant's established shareholding but refusing to process a disputed application for additional shares while maintaining his established holding as reflected in the records. There was no obligation to afford a hearing before declining to process a disputed application, particularly where the other director had disowned the purported resolution.
Whether the trial court engaged in impermissible merit review
No. The trial judge properly examined the legality of the registrar's decision-making process, and courts in judicial review may scrutinise the evidentiary basis of administrative decisions.
The appellant argued the trial court entered the domain of merit review by assessing whether company meetings and resolutions were genuine. The Court of Appeal rejected this, holding that in judicial review courts are entitled and required to scrutinise the evidentiary basis of administrative decisions, since the authenticity of documentation goes directly to the reasonableness and legality of the registrar's reliance on it. The trial judge had therefore asked the correct questions.
Legal principles established
#- The High Court sitting in judicial review examines the procedure and process by which a decision was made, not the merits of the decision.
- Section 844 of the Companies Act empowers the registrar to correct documents that appear incomplete or internally inconsistent, and the registrar acts lawfully in declining to process transactions where verification raises red flags.
- One cannot seek to quash by certiorari a decision that was never made; a refusal to approve a share increase pending verification is not a decision reducing established shareholding.
- The right to be heard under natural justice applies when an adverse decision affecting established rights is made, not where a disputed application for additional shares is merely declined.
Court orders
#- 1.The appeal is dismissed
- 2.Costs of the appeal are awarded to the respondents
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court
- Not stated in the judgment
- Jurisdiction invoked
- First appellate jurisdiction over the High Court's judicial review ruling (not stated by reference to a specific constitutional or statutory provision)
Relief refused
#Setting aside the High Court ruling dismissing the judicial review application and quashing the registrar's decision via certiorari
The appellant failed to demonstrate any hallmark of judicial review; the registrar's action was a refusal to process a disputed application, not a quashable decision to reduce shares
Costs
The appeal is 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.
The upshot is that the appeal is dismissed with costs to the respondents.
The appellant has woefully failed to demonstrate any of the hallmarks of judicial review - illegality, irrationality, or procedural impropriety.
In our view, this was not a decision to reduce shares, but rather a refusal to approve an increase in shares based on questionable documentation; a distinction that is crucial to understanding the true nature of the impugned action.
One cannot seek to quash a decision that was never made.
There was no obligation to afiord a hearing before declining to process a disputed application for additional shares, particularly where the other director had disowned the purported resolution.
Section 844 of the Companies Act clearly clothes the 1st respondent with clear statutory authority to correct documents that appear incomplete or internally inconsistent.
Issues in the judgment
#The parties' names and the case number/citation are not stated on the face of the judgment text; the coram appears only as a certified copy block rather than a formal bench listing, and no case number or neutral citation is given.
The judgment contains internal inconsistencies in the spelling of names ('Njernoni Limited', 'Monicah Njenga Wangui', 'David Njenga Kinyanjui') and OCR-type errors ('afiord', 'confiicting'), though these do not affect the holdings.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Njenga v Registrar of Companies & another (Civil Appeal 26 of 2020) [2025] KECA 1672 (KLR)", Case Analysis (2025). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2025/1672/eng@2025-10-21
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.