Court Declares Nairobi Businesswoman Mentally Fit in Dispute Over Alleged Fraudulent Loans

The court found that the allegations of fraud and unlawful control over Fatmabai’s businesses and properties warranted a full hearing on their merits.

By Andrew Kariuki

A Nairobi-based businesswoman, Fatmabai Sherali Esmail, has been declared mentally fit to proceed with a legal battle against her late sister’s children, whom she accuses of taking out large loans using her name without her knowledge or consent.

The dispute dates back to 2014 when Fatmabai temporarily relocated to Nairobi to settle her elder daughter in university. During that period, she left the management of her businesses in the hands of her sister’s children. She later returned to Mombasa in 2015 to care for her ailing sister, who died three months later, only to discover that her businesses and properties had allegedly been taken over.

In September 2024, the defendants, including Abdeel Enterprises Limited and Parviz Haiderli Nathoo among others, filed a Notice of Motion claiming that Fatmabai was suffering from Major Depressive Disorder and was therefore incapable of understanding or participating in the legal proceedings.

They sought to have her suit dismissed or struck out, or alternatively, to compel her to deposit security for costs. In support of their application, they relied on a private medical report dated September 30, 2023, as well as previous instances where Fatmabai had executed a Power of Attorney in favour of her daughter in related matters.

Fatmabai acknowledged that she had experienced episodes of depression in the past, including a short period of treatment following her 2008 divorce and again in 2022 during the ongoing dispute. However, through her lawyer Hans Oichoe, she strongly opposed the claims, maintaining that her condition did not impair her ability to participate in court proceedings.

She further described the defendants’ characterization of her as “mad” or “psycho” as stigmatizing and unfounded, adding that her emotional distress had been worsened by what she termed as the unlawful takeover of her businesses and properties.

In its analysis, the court noted that while depression is a recognized mental health condition, it does not automatically render a person legally incapacitated. The court emphasized that legal capacity under Kenyan law is determined by an individual’s ability to understand proceedings and issue instructions to legal counsel.

Justice Peter M. Mulwa observed that no credible, court-verified medical evidence had been presented to conclusively prove that Fatmabai was incapable of prosecuting her case. He further noted that striking out a suit is a drastic remedy that should only be applied where a matter is clearly unsustainable.

The court found that the allegations of fraud and unlawful control over Fatmabai’s businesses and properties warranted a full hearing on their merits.

In a ruling delivered virtually on July 31, 2025, Justice Mulwa dismissed all the defendants’ applications, including the request for a declaration of incapacity, dismissal or striking out of the suit, and the demand for security for costs.

The court further directed that an independent mental assessment be conducted at Mathari National Teaching and Referral Hospital under court supervision.