Court of Appeal Now Suspends the Winding Up Proceedings Against KDN

Woooo!!! The managers of the troubled KDN can now breathe easy. The Court of Appeal judges (Justices Githinji, Onyango Otieno and Visram) has suspended the Winding up case proceedings until when the Court of Appeal will hear and determine KDN’s application for stay of orders. This means that the High Court will not mention the case on 5th October as granted to Soliton.

KDN is facing a few challenges including the rumours of sacking of entire senior management team and also this court case where it had been ordered to deposit Ksh 400 Million in a joint account with Soliton Telemec.

Full Statement from KDN on the Court Order

Nairobi Kenya October 3, 2011– This morning at 9.00 am KDN’s application for staying Soliton’s winding up proceedings was mentioned in the Court of Appeal before Justices Githinji, Onyango Otieno and Visram. 

The mention had been requested by KDN on account of last week’s failure of the Court to hear its application due to the indisposition of Justice Nyamu.  After hearing Mr. Murgor, representing KDN, at length on the adverse effects of Soliton’s advertisements including the fact that the debt is disputed; as each party claims from the other and that the dispute should have been referred to arbitration.  Mr. Sagana for Soliton, after much deliberation agreed to defer the upcoming winding up proceedings until the determination of KDN’s application.

The Court finally ordered, by consent, that the Winding Up proceedings be postponed until the hearing and determination of KDN’s application within two weeks.  In particular, this puts a stop to Soliton’s attempt to mention the case in the High Court on 5th October 2011 for the purposes of progressing the winding up proceedings.

Soliton Telmec had on 18th October, 2010 filed a Winding Up Petition against KDN regarding payment for work it claimed to have performed. KDN thereafter filed an application to stay the hearing of the Winding Up Petition and refer the dispute to arbitration as provided for in the Network Expansion Agreement. On 30^th August, 2011 after hearing the Court dismissed KDN’s application and ruled that the Winding Up Petition should proceed to hearing.

It is at that time that KDN immediately applied for an order of stay pending appeal to the Court of Appeal, whose hearing failed to take off given the indisposition of Justice Nyamu.