American priest gets court nod in running of St Mary's Hospitals

The High Court has turned the tables on the Assumption Sisters in the long-running row over the management of the St Mary’s Mission Hospitals with Father William Charles Fryda.

Justice Wayua Mongare ordered the Registrar of Companies to rectify the register to have Father Fryda’s name as a proprietor of the St Mary Mission Hospital, Nairobi.

Justice Mongare said that the Court of Appeal found that since the incorporation of the institution, the Catholic priest was left out despite being the cog in the health facilities.

“I find and hold that it is therefore in public interest that the register of the company should be rectified to reflect the applicant as the director of the company for purposes of implementing the decision of the Court of Appeal and this Court is duty bound to make that direction in light of section 862(6) of the Companies Act which mandates the Court to make such consequential orders as appear just with respect to the legal effect (if any) to be accorded to the entry because it has appeared in the register,” ruled Jusice Wayua.

At the same time, she found that Sister Teresiah Ndeto had resigned as a director and does not hold a post at the institution.

“It is therefore my finding that the Registrar ought to have accepted the respondent’s resignation, which was communicated by way of and evidenced by the statutory declaration dated April 6, 2021,” she said.

The Judge said the court was clear that the hospitals and assets should be handed over by the Assumption Sisters of Nairobi Trustees (ASN) to the company in contest and overseen by both the trustees and the priest.

On one hand, Ndeto claimed that Fryda had no interest in the company as he was not a beneficiary of the ASN.

However, Justice Wayua said that the orders of the court were clear that the hospitals and assets should be handed over by ASN to the company in contest and overseen by both the trustees and the priest.

“The Court of Appeal, which directed ASN to transfer the subject properties to the company, and ordered that the company should manage the hospitals and further that ASN and the applicant should jointly oversee the handover, this determination expressly acknowledges that the applicant has a stake in the matters concerning the affairs and operations of the company, including its governance,” she said.

The Court of Appeal, in its September 25, 2020, ruling, had declared that properties LR Nos. 27228, 27229, 9361/10, and Kiine/Rukanga/2846 to be held at St Mary’s Mission Hospital, Nairobi, for the sole purpose of providing health services to the poor.

A three-judge bench comprising Justices Asike-Makhandia, Kathurima M’Inoti, and Agnes Murgor further ordered that the titles, then under ASNRT, be transferred to the hospital.

The judgment stated that any use of the properties other than that of providing health services to the poor or such other auxiliary purposes is null and void.

Fryda insists that establishing a medical training college at St Mary’s in Lang’ata contravenes this ruling and accused the Council of being misled into aiding the breach through “non-disclosure of material information.”

The American doctor, who founded St Mary’s Mission Hospitals in Lang’ata and Gilgil, said he had initially acquired the contested land in 1998 and 2001 and registered them under ASNRT, pending incorporation of the company that would hold the assets in perpetuity.

In court, he told the Judge that he organised the incorporation of the company while the initial directors were Sr MGT, Sr SG and Ndeto.

He told the court that he ran St Mary’s as a medical director until 2010, when he allegedly discovered that the hospital had been transferred to ASN.

He also claimed that following the Court of Appeal’s judgment, he found out that one of the issues was that Ndeto had been incorporated as a director and member despite her resignation. Fryda said that the entry followed an alleged meeting of an entity called St. Mary's Mission Hospital Limited.”

Ndeto, on the other hand, claimed that Fryda was allegedly trying to gain control of the company through the back door. She alleged that he had violated orders of the Court of Appeal, requiring him to hand over company documents and property titles.

Ndeto said that she had allegedly resigned from the board of directors and not as a subscriber. She insisted that she had not transferred her shares.

She accused Fryda of running his personal hospital next to St Mary, and maintained that she was the only surviving director.