KENYA SUGAR BOARD V. MUMIAS SUGAR COMPANY LIMITED, BUSIA SUGAR COMPANY LIMITED & BUSIA OUTGROWERS COMPANY LIMITED

JUDGMENT OF THE COURT

INTRODUCTION

1. This appeal relates to setting aside of a consent judgment by both a party to the consent and a third party who is directly affected by the consent judgment but who did not participate in the proceedings that gave rise to the consent. The appeal also examines the propriety of proceedings commenced against a company under receivership without the sanction of the Receiver.

BACKGROUND

2. The Kenya Sugar Board (hereinafter referred to as “KSB”), the appellant, held a debenture over all the assets of Busia Sugar Company Limited (hereinafter referred to as “BSC”), the 2^nd respondent. The debenture, dated 5^th April, 2004, inter alia, was a floating charge and secured a sum of Kshs.20,400,000/= plus interest thereon and made KSB the beneficial owner of all current and future assets of BSC. The debenture was to remain valid unless discharged.

3. BSC was made to repay the amount advanced to it, and consequently, by a Deed of Appointment dated 1^st March, 2006, KS…