Court declares the Constituency Development Act Unconstitutional

Institute of Social Accountability & another v National Assembly & 4 others
High Court at Nairobi
Petition No 71 of 2013
I Lenaola, M Ngugi, Majanja J
February 20, 2015
Reported by Andrew Halonyere

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Brief facts
The petitioners brought a petition before the High Court seeking declarations that the Constituencies Development Fund Act No. 30 of 2013 (CDF Act) violated the Constitution.
The petitioners’case was that the CDF Act contravened the constitutional principles of the rule of law, good governance, transparency, accountability, separation of powers and the division of powers between the National and County Government and the public finance management and administration.

Issues

  1. Whether the process leading to the enactment of the CDF Act was Constitutional.
  2. Whether the CDF Act offends the principles of public finance and division of revenue provided under the Constitution.
  3. Whether the CDF Act violates the division of functions between the National and County Government.
  4. Whether the CDF Act offends the principle of separation of powers.

Statutes – interpretation of statutes –interpretation of the CDF Act – whether the CDF Act duplicates and overlaps the County Governments’ functions under the Fourth Schedule of the Constitution.
Constitutional law – National revenue – division of national revenue – where funds are sent to the constituencies in compliant with the CDF Act – whether by sending revenue to the constituencies as required by the CDF was in contravention with Articles 202 and 203 of the Constitution.
Constitutional law – public participation - degree of participation in the law-making process – whether the public were accorded reasonable opportunity in the law making process - what amounted to a reasonable opportunity – whether process leading to the enactment of the CDF Act was Constitutional.
Constitutional law – enactment of laws – enactment of laws to align with the Constitution of Kenya - whether the CDF Act was one of the contemplated laws under section 2(3) (b) of the sixth schedule to the Constitution relating to devolved government that were required to be enacted by the sixth schedule and chapters eleven and twelve of the Constitution within the period stipulated in the fifth schedule
Constitutional law – devolution – Constituency development Fund – whether it had been contemplated in the statutes that a constituency had to be one of the beneficiaries of the national revenue before it was divided between the National and County Government – Constitution of Kenya 2010, articles 93,96(1),110,165,202,203,259.

Held

  1. The High Court was enjoined under article 259 of the Constitution to interpret the Constitution in a manner that promotes its purposes, values and principles, advances the rule of law, human rights and fundamental freedoms in the Bill of Rights and that contributes to good governance. In exercising its judicial authority, the High Court was obliged under article 159(2(e) of the Constitution to protect and promote the purpose and principles of the Constitution.
  2. The general presumption was that every Act of Parliament was constitutional and the burden of proof lay on any person who alleged otherwise.
  3. In determining whether a Statute was constitutional, the Court had to determine the object and purpose of the impugned statute, for it was important to discern the intention expressed in the Act itself. Further, the court had toconsider not only the purposeof the Act but also its effect.
  4. While interpreting the impugned legislation alongside the Constitution, the Court had to bear in mind Kenya’s peculiar circumstances. The court had toadopt a liberal approach that promoted the rule of law and that had jurisprudential value that reflected the spirit of the Constitution, since the matter concerned devolution.
  5. Article 93 established Parliament comprising the National Assembly and the Senate. Each of the Houses was enjoined to perform their respective functions in accordance with the Constitutionand where the Constitution prescribed a procedure that ought to have been followed in enacting a law, that procedure had to be followed. Therefore while Parliament might legislate on any matter concerning the Republic, the legislation had to conform to the Constitution both procedurally and in its substance.
  6. The issue of whether the matter was one for County Government was of constitutional importance and the decision of the speakers of the National Assembly and the Senate, could not be conclusive and binding on the court, whose jurisdiction was to interpret the Constitution.
  7. Participation of the Senate in the legislative process was not just a matter of procedure it was significant to the role of the Senate in Kenya’sconstitutional scheme, as the Senate’s legislative role was limited to matters concerning County Governments. Through its participation in the legislative process, the Senate was seized of the opportunity to discharge its primary mandate which was to protect the interests of the counties and County Governments as mandated under article 96(1) of the Constitution. It was a means of ensuring that the county’s voice was heard and considered at the national forum and the interests of counties and their governments secured. That way, the sovereign power of the people was duly exercised through their democratically elected representatives.
  8. While concurrence of the Speakers of the National Assembly and the Senate was significant in terms of satisfaction of the requirements of article 110(3) of the Constitution, it did not by itself oust the power of the Court vested under article 165(3)(d) where a question was raised regarding the true nature of legislation in respect to article 110(1). The court had to interrogate the legislation as a whole and determine whether in fact the legislation met the constitutional test of a matterconcerning County Government.
  9. The laws contemplated under section 2(3)(b) of the sixth schedule to the Constitution were the laws relating to devolved government that were required to be enacted by the sixth schedule and chapters eleven and twelve of the Constitution within the period stipulated in the fifth schedule. The CDF (Amendment) Bill was not one of the laws contemplated under section 14 of the sixth schedule as it was an amendment to an existing legislation.
  10. The forms of facilitating an appropriate degree of participation in the law-making process were capable of infinite variation. What matteredwas that at the end of the day a reasonable opportunity was offered to members of the public and all interested parties to know about the issues and to have an adequate say. What amounted to a reasonable opportunity would depend on the circumstances of each case.
  11. In order to determine whether there had been public participation, the court was required to interrogate the entire process leading to the enactment of the legislation from the formulation of the legislation to the process of enactment of the statute.
  12. During the legislative process, amendments to the Bill might have been moved during the Committee Stage and to have held that every amendment moved had to undergo the process of public participation would negate and undermine the legislative process. The amendment moved was in substance, within the parameters of what had been subjected to public participation during the review process. The public was involved in the process of enactment of the CDF Act through the Task Force and review panel initialy set up by CDF Board. The amendment was within the parameters of what was in the public domain and in the circumstances the amendment bill did not violate the principle of public participation.
  13. County Governments’ share of revenue had to be at least fifteen per cent of all revenue collected by the National Government’ in accordance with article 203(2) of the Constitution. The import of that provision was that any amount that reduced the amount of shareable revenue or revenue collected by the National Government effectively affected the amount available to the counties hence an infringement on the requirements of the provision. The Constitution did not envisage any other organ, body or fund to have a share of all the revenue collected by the National Government before it was shared between the two levels of government established under article 1(4) of the Constitution.
  14. It was not contemplated anywhere that a constituency had to be one of the beneficiaries of the national revenue before it was divided between the national and County Government. Article 206 (1)(a) and (b) of the Constitution excluded from the Consolidated Fund such monies excluded by an Act of Parliament and was payable into another fund established for a specific purpose.
  15. For purposes of equitable sharing of revenue the phrase ‘revenue raised nationally’ as used in articles 201(b)(ii), 202(1) and 203(2) was to be equivalent to ‘revenue raised by the National Government’ within the wording of article 218 of the Constitution. The implication of the wording of the provisions was that the revenue shared between the national and County Government and amongst the counties was not received from anywhere else but from the revenue collected by the National Government. In other words all revenue collected by the National Government had to be pooled in a common pot before it was shared by the levels of government. It was in that light that the wording of the impugned section ought to be scrutinized.
  16. The use of the phrase, ‘all the national government ordinary revenue’ in the CDF Act introduced ambiguity. However, as case law had established, not all ambiguity necessarily rendered a statute unconstitutional, as such ambiguities could be solved by applying rules of interpretation.
  17. CDF was not a conditional grant to County Governments envisaged under article 202(2) of the Constitution, as it was not even expressed to be such.
  18. Section 22 of the CDF Act demonstrated that the Act was not clear in terms of what projects the CDF was supposed to fund and implement. The section broadly referred to unspecified projects which the court was unable to determine to which level of government they belonged into as per the Fourth Schedule to the Constitution. Nevertheless, the drafters of the Constitution did not envisage that there would be a three tier system (national government, County Government and constituency) that would be charged with infrastructural development at the county level.
  19. From a plain and literal reading of the provisions of article 186 and the Fourth Schedule to the Constitution, it could not be said that for instance, infrastructural development and wealth creation at the Constituency level was solely a function of the national government. Infrastructural development was such a fluid term that might include county transport and development of county health facilities which would fall within the functions of County Government enumerated in Part 2 of the Fourth Schedule.
  20. Article 186(1) of the Constitution had set out that National and County governments were to share certain functions within the County and those functions were clearly stipulated in the Fourth Schedule of the Constitution. The creation and assignment of roles to an entity outside the structures of governance established under the Constitution was antithetical to the principles of the Constitution as it threatened to violate the functional competencies of County Government within which CDF operated.
  21. The national government might impose conditions on grants issued under article 202(2) of the Constitution. Those conditions might include naming the specific projects to which such grants were channeled. However, the conditions attaching to those grants, including the manner of implementation had to by themselves be in line with the devolution principles and constitutional values. Such conditions must not be such that they undermined the County Government autonomy envisaged under the Constitution.
  22. The national government, while free to infiltrate its policies at the county levels, it could only do so through the structures recognised under the Constitution and not run parallel to them. If it so desired, the national government could channel grants, whether conditional or unconditional to the County Governments as additional revenue within the meaning of article 202 and not any other entity which performed the functions allocated to the county by the Constitution. The national government could not purport to channel grants to an entity whose intended projects effectively undermined the role of the government at the county level unless the projects were specifically defined to exclude them from the ambit of Part 2 of the Fourth Schedule of the Constitution.
  23. The CDF appears to be a third entity grafted from the national government that operated within the County Governments but outside their structures. The involvement of the members of the National Assembly and Senators in the implementation and administration of CDF, infringes the Constitution in two ways. First, it threatens to violate the division of functions between the national and County Governments. It threatens because the purpose of the Act, coupled with the target projects under section 22 were vaguely worded, and lacked a specific cause, it was premature to categorically class the enumerated projects as falling either under the national or County Governments. It is nevertheless a safe inference to make at this point that the reference to ‘community based projects’ within the wording of section 22 would at the very least cause a functional overlap with those of County Governments.
  24. The Constitution required that the County Governments decentralize their functions and services to the extent that it was efficient and practicable to do so under article 176(2). That principle is fortified by Part VI of the County Governments Act, 2012 which sets out the decentralisation units in a county. The Constitution envisaged that although power was shared between the national and County Government, the decentralized units within the county would facilitate the achievement of the objects of devolution through to the grassroots.
  25. Under article 1 of the Constitution, the County Government does not derive its power from the national government but directly from the People of Kenya and under the Constitution. Those two levels of governments were in theory, equal and none was subordinate to the other. MPs and cabinet secretaries involved in the management or implementation of the CDF constituted the executive and legislative organs of the national government, their involvement in development activities at the county level not only threatened to undermine the functions of the government at the county level but also blurred the executive and legislative divide that underlies the principle of separation of powers. Therefore it was unconstitutional for the national government to extend its mandate in the counties beyond its mandate under the Constitution through the artifice of the CDF.
  26. At the national level, under article 93(1) of the Constitution, there is established a Parliament consisting of the National Assembly and the Senate. In the same breath at the county level, there is the County Assembly and the County Executive headed by the Governor. Therefore, the arrangement introduced by the CDF of having Members of Parliament getting involved in the implementation of the development agenda of a county undermined the County Government and especially the role of the county executive. At the County level the Governor and the County Executive Committees were the executives in the county and in charge of development policies.
  27. The involvement of the Members of Parliament in the CDF implementation violated the core principle of separation of powers and to that extent, the CDF Act was unconstitutional. Further, to the extent that the Act conflates the executive and legislative functions, it obfuscates accountability mechanism envisaged under the Constitution underpinned by the doctrine of separation of powers. In that respect, the Act violated key national values and principles enunciated under article 10 of the Constitution, to wit, good governance and accountability.
  28. Members of Parliament have a specific and clearly defined role under the Constitution. That role does not include involvement bodies whose functions entail co-coordinating, project approvals or actual implementation of projects as those functions were executive in nature. It was also untenable to permit Senators, who were charged with the constitutional role of oversight over county resources from the national government to the county government, to convene and chair County Project Committee as established under Part VII of the CDF Act.
  29. Parliament was constitutionally bound to enact legislation that assists and strengthens the county governments in the discharge of their roles rather than one that undermined them, as the CDF Act effectively did. The organs of the national government must trust and utilize the machinery that the Constitution now ordains. Even with the noblest of intentions, any Act of Parliament had to meet the threshold of constitutionality for it to withstand the test of validity.
  30. The purpose of the CDF (Amendment) Act was to amend a law that violated the division of functions between the national and county governments. Therefore an amendment to the Act would have necessitated the input of the Senate. The purpose of involving the Senate was to ensure that counties, as far as possible, get to effectively participate in the legislative business at the national level in matters substantially affecting interests of county governments. That calls for the court to look beyond the substance or purpose of the statute expressed in the text.
  31. The court had to unbundle the specific provisions of the proposed legislation to see if and to what extent they satisfied the criteria set out under article 110(1) of the Constitution. An amendment to the Act affecting the manner in which money was allocated to the CDF was the core part of the Act. As the availability of money affects the financing and implementation of projects that fall within the competence of the County Government, the provision could not be severed without undermining the entire Act. The CDF (Amendment) Bill was not an insubstantial amendment. Therefore the CDF (Amendment) Billwas unconstitutional for want of involvement by the Senate
  32. Devolution was a panacea to addressing the developmental and equity gaps that existed in our communities. That was not however to say that the National Government could not conceptualize and fund development initiatives at the local level, what was critical was that such initiatives in both design and implementation, had to respect the system of governance in existence and the spirit and letter of the Constitution.
  33. Constitutional cases could not be decided on the basis that Parliament or the President acted in good faith or on the basis that there was no objection to action taken at the time that it was carried out. It was of crucial importance at an early stage of the development of the new constitutional order, to establish respect for the principle that the Constitution was supreme. The Court’s duty was to declare legislative and executive action which was inconsistent with the Constitution to be invalid, and then to deal with the consequences of the invalidity in accordance with the provisions of the Constitution.
  34. In order to protect the Constitution, the court would have to be creative in fashioning appropriate relief that is tailored to the facts of the case and that is consistent with the values of the Constitution. Suspension of the declaration of invalidity would be appropriate in the circumstances as it would allow the Legislature time to correct the defective legislation while avoiding chaos and disarray in a system that had been established for over a decade. Such a move would support good governance, a core national value under article 10 of the Constitution.
  35. In determining the period of suspension various factors must be taken into account including, the government’s previous conduct, whether there was any legislation in the pipeline and the nature and severity of the continuing infringement. In order to allow for transitional and corrective mechanisms, suspension of the invalidity of the CDF Act for a period of twelve months from the date of the judgment was a reasonable period. The National Government is entitled to remedy the defects in the period either in form of new legislation or other means within the Constitution. For avoidance of doubt, the Act may be repealed earlier by an Act of Parliament or await the expiry of the suspension, whichever comes first.
  36. Obiter “ The Court must patrol Kenya’s constitutional boundaries with vigor, and affirm new institutions, as they exercise their constitutional mandates, being conscious that their very infancy exposes them not only to the vagaries and fragilities inherent in all transitions, but also to the proclivities of the old order.”

Orders
Constituencies Development Funds Act, 2013 is unconstitutional and therefore invalid.
The order of invalidity above is suspended for a period of twelve (12) months from the date of judgment.
The National Government may remedy the defect within that period and the Constituencies Development Fund Act shall stand invalidated at the expiry of the twelve (12) months or may be earlier repealed whichever comes first.
Each party shall bear its own costs.



Kenya Law
Case Updates Issue 07/2015
Case Summaries

LAND LAW Interpretation of Notice to sell under the Land Act, vis a vis the Auctioneers Rules

Albert Mario Cordeiro & another v Vishram Shamji
High Court at Nairobi
Civil Suit No 329 of 2014
G Kikonyo, J
February 3, 2015
Reported by Andrew Halonyere

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Brief facts
The plaintiff brought an application before the High Court seeking an order for injunction restraining the defendants from selling or in any manner whatsoever interfering with the suit land and that the defendants statutory power of sale be suspended or postponed for a period of twenty four (24) months or for such other period as the court may determine to enable the Plaintiffs redeem the suit land.
The plaintiff submitted inter-alia that the Defendant had neither served a statutory notice upon the Plaintiffs nor issued a statutory notice that complied with section 90(1) and 90(2)(b) of the Land Act, 2012.
The defendant/respondent on their part submitted that the plaintiff/applicant purchased the suit premises from the defendant/respondent for Kshs. 70,000,000 and that the plaintiff/applicants were not able to pay the entire sum and requested the defendant/respondent for a financial accommodation. The defendant/respondents further submitted that they agreed to the request and they registered a charge against the title to secure the repayment of Kshs. 22,500,000 together with interest at 18% per annum. The plaintiff/applicants never made any repayment up to the time the redemption date became due.

Issues:

  1. Whether the charge instrument was in compliance with section 80(3) of the Land Act that makes provisions for requirements of a charge instrument.
  2. Whether the notice to redeem issued under rule 15(d) of the Auctioneers Rules could serve as a notice to sell under the Land Act.
  3. Whether the defendant served the applicants with a statutory Notice pursuant to section 90(2) of the Land Act.

Land Law – Charges and Mortgages – Notice to sell under the Land Act vis a vis the Auctioneers Rules – whether there was a clear legal split between the provisions of the Land Act and the Auctioneers Rules

Land Law – Charges and Mortgages –notice to sell - where notice to sell had not been issued but statutory notice had been served – whether the failure to issue the notice to sell under the Land Act would invalidate the Statutory Notice which had been properly issued.

Land Law – Charges and Mortgages – charge instrument – failure to include the terms and conditions of sale in the charge instrument – whether such omission would render the charge defective - Land Act section 90, 96(2) – Auctioneers Rule 15 (c ). Read More...

Land Act
Section 96(2)

Before exercising the power to sell the charged land, the chargee shall serve on the chargor a notice to sell in the prescribed form and shall not proceed to complete any contract for sale of the charged land until at least forty days have elapsed from the date of the service of the notice to sell.

Section 90 (2)

(2) The notice required by subsection (1) shall adequately inform the recipient of the following matters—

(a) the nature and extent of the default by the chargor;
(b) if the default consists of the non-payment of any money due under the charge, the amount that must be paid to rectify the default and the time, being not less than three months, by the end of which the payment in default must have been completed;
(c) if the default consists of the failure to perform or observe any covenant, express or implied, in the charge, the thing the chargor must do or desist from doing so as to rectify the default and the time, being not less than two months, by the end of which the default must have been rectified;
(d) the consequence that if the default is not rectified within the time specified in the notice, the chargee will proceed to exercise any of the remedies referred to in this section in accordance with the procedures provided for in this sub-part; and
(e) the right of the chargor in respect of certain remedies to apply to the court for relief against those remedies.

Auctioneers Act
Rule 15

Upon receipt of a court warrant or letter of instruction the auctioneer shall in the case of immovable property—

(d) give in writing to the owner of the property a notice of not less than forty-five days within which the owner may redeem the property by payment of the amount set forth in the court warrant or letter of instruction;

Held:

  1. Although under section 90 (5) of the Land Act, the Cabinet Secretary, in consultation with the National Land Commission was required to prescribe the form and content of a notice to be served, unfortunately, the said form or content had not been prescribed as yet. Chargees had to formulate the form and content of the notice to be served which had to comply with the express provisions of section 90 of the Land Act.
  2. Section 80(3) of the Land Act provided that every charge Instrument shall contain the terms and conditions of sale, an explanation of the consequences of default and the reliefs that the chargor was entitled to including the right to sell. The said provision of the Act was a mandatory provision of the law, however the details under the section were not contained in the charge before the Court, therefore, the charge was defective, null and void. In the circumstances, the said charge did not afford the Defendant the powers reserved for chargees in the Land Act and the Chargee could not exercise any power of sale on that charge.
  3. There was clear legal split between the provision of the Land Act and the Auctioneers rules and any attempt to fuse the two could only increases the confusion of the purpose of section 96(2) of the Land Act. The requirements under section 96(2) of the Land Act were mandatory and quite separate from the requirements under the Auctioneers Act. The Redemption Notice under the Auctioneers Act was also mandatory but it is issued separately from and after the one under section 96(2) of the Land Act strictly in that sequence.
  4. When Parliament enacted section 96(2) of the Land Act, the provisions of the Auctioneers Act were existing law as per section 7 of the Sixth Schedule of the Constitution, rule 15 of the Auctioneers Rules applied to sale by public auction of any immovable property in execution of a decree or on instructions such as by a chargee it was not specially tailored for purposes of section 96(2) of the Land Act.
  5. Until the enactment of the Land Law, 2012, equity of redemption had been left to judicial interpretation and case law. But later it had gained statutory expression in section 89 of the Land Act which provided expressly that equity of redemption would not be extinguished except in accordance with the provisions of the said Act. Therefore, exercise of Chargee’s Statutory Power of Sale would only extinguish the Chargor’s Equity of Redemption if it was strictly exercised in accordance with the Land Act. Section 96(2) of the Land Act was one of the provisions of the Land Act which reinforced the Chargors Equity of Redemption. Section 96(2) of the Land Act was not an embellishment in the statute or a duplication of or could be read to mean Rule 15 in the Auctioneers Act.
  6. In the absence of a Notice to sell under section 96(2) of the Land Act, the Statutory Power of Sale could not be exercised even if the Statutory Notice, the Notification of Sale and the Redemption Notice had been issued. That was a strong ground for an injunction. However, the failure to issue the said Notice under section 96(2) of the Land Act would not invalidate a Statutory Notice which had been issued properly under section 90 of the Land Act.
  7. A Statutory Notice should be very clear that should there be non compliance with the demands of the notice the suit property shall be sold. Although the notice was not as clear as it ought to have been, it notified the Chargors of an intention to invoke statutory right of sale of the charged property. The overall purport of the letter was that the property would be sold unless the entire sum was paid within the 90 days. Therefore, it was not true that the Notice did not give a notification of the sale of the property in the event of non-compliance with the Notice.
  8. The Notice to sell did not merely threaten that recovery proceedings would be taken if payment was not made; the Notice adequately informed the Chargors of the nature and extent of the default; i.e. the entire sum of Kshs. 22,000,000 together with interest, legal chargees and related expenses; and that the default consisted of complete non-payment of loan advanced under the purported Charge, which made the entire debt payable at once.
  9. A notice seeking to sell the charged property had to expressly state that the sale shall take place after the three months' period. To omit to say so or to state a period of less than three months for sale was to deny the mortgagor a right conferred upon him by statute. That clearly had to render the notice invalid.
  10. The relevant provision on service was Rule 15(c) of the Auctioneers Rules which required the auctioneer to locate the property and serve the notification of sale of the property on the registered owner or an adult member of his family residing or working with him or where a person refuses to sign such notification, the auctioneer shall sign a certificate to that effect.
  11. It was not enough to indicate that the notification had been served without identifying the person served, the place and the manner it was served. There was ample evidence, however, that the Plaintiffs were aware of the Notification of Sale and all subsequent correspondences were titled Notification of Sale.
  12. The Statutory Notice was issued in accordance with the law and was sufficient in the circumstances of the suit. As injunction was an equitable remedy, a court of equity would have denied the remedy sought if the conduct of the applicant was such that it did not receive approval of equity. All the other legal thresholds might have been suppressed by the offensive conduct relevant to the transaction and litigation before the court. That notwithstanding, the Court would take a path which was fair and just to all, and which carried the lower risk of injustice.

Injunction to restrain the sale of the suit property granted, on condition that Chargee was at liberty to issue a Notice to sell under section 96(2) of the Land Act and thereafter have the property sold in accordance with the Auctioneers Act and Rules.
The Statutory Notice was proper served ,re-issuance not required.

PROFESSIONAL ETHICS Circumstances in which the court can grant coercive orders of enforcement of professional undertakings.

Nelson Andayi Havi t/a Havi & Co. Advocates v Jane Muthoni Njage t/a J M Njage& Co. Advocates
Civil Case No.59 of 2009
High Court of Kenya at Nairobi
Commercial and Admiralty Division
F Gikonyo, J
January 30, 2015
Reported by Teddy Musiga
Download the Decision

Issues:

  1. Whether an advocate who has been given an undertaking by another in a conveyance transaction has the locus standi to enforce that undertaking.
  2. Whether an order to honour professional undertakings need to be issued before enforcing such undertakings.
  3. Whether the enforcement of an undertaking includes interests’ payable under the undertaking where such undertaking is honoured many months after the due date.

Professional Ethics–professional undertakings – enforcement of professional undertakings - whether an advocate who has been given an undertaking by another in a conveyance transaction has the locus standi to enforce that undertaking - whether an order to honour professional undertakings need to be issued before enforcing such undertakings – Civil Procedure Rules, Order 52 rule 7 Read More...

Held:

  1. A professional undertaking was always a separate and distinct contract between advocates had to be interpreted strictly and enforceable between the parties. The respective clients of the advocates in the undertaking were not parties in the undertaking. Therefore, only the advocates as the parties could enforce the undertaking.
  2. When an application was made under Order 52 rule 7 of the Civil Procedure Rules for an order for the enforcement of an undertaking given by the advocate, the court could order in the first instance that the advocate had to honour his undertaking within a time fixed by the order, and only thereafter could an order for enforcement be made. It was only where there were special circumstances, and the court had to record those special reasons, that a court of law could order otherwise. Therefore, the rule of the thumb was to order the advocate to honor the undertaking before the coercive enforcement order was given by the court.
  3. That approach was founded on good reasons such as that the nature and purpose of the undertaking which was given in good faith within an atmosphere of trust whose aim was to facilitate conclusion of a transaction at arms - length.
  4. As to whether interest is payable and by whom could only be determined by looking at the agreement and all other documents which applied to the contract. The instant agreement did not carry an express provision on interest on its body. But through its clause 3, it incorporated the Law Society Conditions of Sale which they agreed would apply to the transaction. The relevant condition on interest was 8(3) & (4) of the Law Society Conditions of Sale which governed the agreement especially on interest on delayed completion. And those two provisions were not expressly excluded by the agreement.
  5. Condition 8(3) & (4) of the Law Society Conditions of Sale provided that the obligation to pay interest on delayed completion was on the purchaser and also it set out the time frame when the interest was payable.
  6. From the sale agreement, the undertaking did not create an express obligation on the defendant to pay interest for delayed completion. It was an obligation of the purchaser.
  7. Although there was a duty on the advocate to act in the client’s interest, that did not imply a duty to assume or underwrite the client’s financial or other obligations under the contract. Also, the law was that, the jurisdiction of the court in enforcing an undertaking by an advocate was not exercised for purposes of enforcing legal rights or obligations of the client but for purposes of enforcing honourable conduct on the part of the advocate as an officer of the court. Thus, it enforced the undertaking strictly as a contract on its own separate from the primary contract between the parties. The honourable conduct of the advocate was embedded in the undertaking.
  8. It was not up to the defendant to care about whether honouring of the undertaking would have produced unfavourable results to her clients. Any advocate, had, of course to be concerned that it was safe to honour such undertaking after effective registration of the conveyance. But such fear would have been unfounded as an undertaking was always given on full instructions of the client and was anchored on the primary contract between the clients. The advocate had to ensure that he was in funds before giving an undertaking.
  9. In such circumstances where the advocate did not honour the undertaking until after a suit had been filed and did not seek consensus of the other counsel to vary the terms of the undertaking constituted special reasons on which the court could issue a coercive order of enforcement especially given that the defendant was in funds all that time but just did not honour the undertaking.
  10. An undertaking could not place an obligation on the advocate to pay or underwrite the client’s obligations. However, there would be nothing illegal if the enforcement of the undertaking would have achieved the unintended result of enforcing the purchaser’s obligations or rights under the agreement. Therefore, since the interest had been agreed at 17.5% for delayed completion, it was in order to peg interest against the defendant for withholding the funds at the same rate of 17.5% for breach of the undertaking.

Advocate was ordered to pay interest at 17.5% for the eight months she withheld the purchase price.

STATUTES Holders of Broadcast license must apply for license afresh pursuant to the Kenya Communications (Amendment ) Act 2009

Nature Foundation Limited v Minister for Information and Communications &another
Court of Appeal at Nairobi
Civil Appeal No 214 of 2011
M Warsame, K M’inoti & A Murgor, JJ. A
January 30, 2015
Reported by Andrew Halonyere

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Brief facts
This was an appeal against the High Court’s decision to decline to issue an order of certiorari to quash regulations 46(1), (2) and (3) of the Kenya Communications (Broadcasting) Regulations, 2009, purporting to provide for Transition of permits to licences.
The appellant’s case before the High Court was that the regulations were made ultra vires, and in violation of sections 46A (a) and (d), 46D (2)(b) and (d), 46K (a), and 46 (R) of the Kenya Information and Communications Act of 1998, and paragraphs 2(a) and (b) of the Fifth Schedule to the Kenya Communications (Amendment) Act, 2009.
According to the appellant, paragraph 2 of the Fifth Schedule of the Act in part, required that parties holding broadcast licences would be granted a period not exceeding one year during which they could continue to operate with their existing permits, and then apply to the Commission to be licensed under the Act. However, the appellant submittedthat the 1st respondent went against the provisions of the Act and promulgated a regulation that allowed the holders of broadcast permits to retain such radio frequency resources already assigned under the same terms and conditions of issuance. The appellants asserted that, that was contrary to the provisions of the Kenya Information and Communications Act, which required all persons to apply afresh to the 2nd respondent before they were licensed.
In opposition, the 1strespondent took issue with the standing of the appellant, claiming that being a private company, it had no locus to institute a suit against the respondents.
The 2nd respondent on its part denied that the regulations were ultra vires and stated that it had not cancelled the existing licenses due to the fact that there had been a delay in publishing regulations that would provide transition to the new regime. It was further submitted that the principles of diversity and plurality in the Kenya Communications Act had been given effect in other rules in the regulation, such as regulations 10, 13 and 35 of the impugned regulations.
The High Court held that regulations 46(1) and 46(2) were within the Kenya Information Communications Act, 1998. However, the court found that regulation 46 (1) (c) was ultra vires the Act, but refused to strike it down due to the fact that the appellant had not established that it had locus standi to bring the suit. Being aggrieved by the findings of the High Court, the appellant filed an appeal before the Court of Appeal.

Issues:
  1. Whether regulations 46(1), (2) and (3) of the Kenya Communications (Broadcasting) Regulations, 2009, purporting to provide for Transition of permits to licences were made ultra vires, and in violation of sections 46A (a) and (d), 46D (2)(b) and (d), 46K (a), and 46 (R) of the Kenya Information and Communications Act of 1998, and paragraphs 2(a) and (b) of the Fifth Schedule to the Kenya Communications (Amendment) Act, 2009.
  2. Who has the locus standi to petition a court of law to strike down ultra vires regulations?

Statutes – interpretation of statutes – whether regulations 46(1), (2) and (3) of the Kenya Communications (Broadcasting) Regulations, 2009, purporting to provide for Transition of permits to licences were made ultra vires, and in violation of sections 46A (a) and (d), 46D (2)(b) and (d), 46K (a), and 46 (R) of the Kenya Information and Communications Act of 1998, and paragraphs 2(a) and (b) of the Fifth Schedule to the Kenya Communications (Amendment) Act, 2009 – Kenya Communications (Broadcasting) Regulations, 2009 regulations 46(1),(2) & (3)- Kenya Information and Communications Act 1998 sections 46A (a) and (d), 46D (2)(b) and (d), 46K (a), and 46 – Kenya Communications (Amendment) Act, 2009 paragraphs 2(a) & (b)

Constitutional Law – locus standi to enforce a fundamental right– landscape of locus standi - whether any person could institute proceedings under the Bill of Rights, on behalf of another person who could not act on their own or in public interest –Constitution of Kenya 2010 articles 22, 258. Read More...

Kenya Communications (Amendment) Act 2009.
Section 2 of the Fifth Schedule provides that:

The Commission shall respect and uphold the vested rights and interests of parties holding broadcasting permits issued by the Minister prior to the commencement of this Act; Provided that —

a. such parties shall be granted a period not exceeding one year during which they may continue to operate in accordance with their existing permits; and
b. before the expiry of the one year period, such parties shall apply to the Commission to be licensed under this Act”

Kenya Information and Communications Act, 1998.

46. (1) Pursuant to section 46R of the Act, all persons issued with broadcast permits prior to the commencement of the Kenya Communications (Amendment) Act, 2009 shall —

(a) be required to apply for broadcast licence(s) in such a manner asmay be prescribed by the Commission;
(b) pay such fees as may be prescribed by the Commission for theissuance of the broadcasting licence(s) to replace the permits andfrequency licence and usage fees;
(c) retain such radio frequency resources already assigned under thesame terms and conditions of issuance:
Provided that they comply with such new terms and conditions thatthe Commission may be impose;

(2) In addition to the requirements specified under section 46D (2), the Commission shall, when considering an application for a licence to replace a permit, consider—

(a) the past compliance record of the applicant relating to adherence to the conditions of the broadcasting frequency licence; and
(b) the status of frequency fee payments.

(3) Any person who holds a broadcasting permit and who has been assigned more than one broadcast frequency for either radio or television broadcasting services in the same broadcast coverage area, shall be required within a period not exceeding the licence term, to surrender all additional broadcasting frequencies to the Commission.

Held:

  1. Judicial review remedies were discretionary and the Court had to consider whether they were the most efficacious in the circumstances of the case. Judicial review was in the purview of public law, not private law.
  2. The landscape of locus standi had been fundamentally transformed by the enactment of the Constitution in 2010 by the people themselves. The previously stringent locus standi requirements of consent of the Attorney General or demonstration of some special interest by a private citizen seeking to enforce a public right had been buried in the annals of history. By dint of articles 22 and 258 of the Constitution, any person could institute proceedings under the Bill of Rights, on behalf of another person who could not act in their own name, or as a member of or in the interest of a group or class of persons, or in the public interest.
  3. Where a legal wrong or injury was caused or threatened to a person or to a determinate class of persons by reason of violation of any constitutional or legal right, or any burden was imposed in contravention of any constitutional or legal provision, or without authority of law, and such person or determinate class of persons was by reason of poverty, helplessness, disability or socio-economic disadvantage, unable to approach the court for relief, any member of the public could maintain an application for an appropriate direction, order or writ in the High Court under articles 22 and 258 of the Constitution.
  4. The Constitution of Kenya, 2010 had been in force for almost a year, by the time the High Court was delivering its ruling. Therefore, the High Court erred in finding that the appellant had no locus standi to sustain the suit. Courts had departed from the strict and stringent locus standi requirement of sufficient interest long before the matter was instituted. The Court of Appeal could not cling to an outdated relic of law when in actual sense there had been a remarkable development and fundamental departure from the old school of legal thinking and approach.
  5. Regulation 46 (1) and (2) had been made within the scope of the Act. That regulation only provided for further transitional provisions, requiring broadcasters, if they wished to continue with the business of broadcasting, to apply for licences in the manner that the 2nd respondent might have required them to do, and provided for the particular procedure to be followed by parties who intend to continue with broadcasting. The fact that a party transiting was required to make an application was not an infringement or a departure from the statute or the Constitution. There was no derogation or abrogation of the requirements of articles 33 and 34 of the Constitution. That could not be said to be ultra vires the provisions of the Fifth Schedule to the Act which provided for the respect and upholding of vested rights and interests of broadcasters. In fact, the rule gave effect to the section 2(b) of the Fifth Schedule in that it required those parties to apply to the 2nd respondent to be licensed under the Act.
  6. The High Court found that regulation 46(3) was ultra vires as it amounted to maintaining the status quo, and further was contrary to the provisions of paragraph 2 of the Fifth Schedule. That regulation required all broadcasters to surrender any additional broadcast frequency that might have been assigned to them to the 2nd respondent. The rule was not in conflict with section 2 of the Fifth Schedule, since the schedule only stipulated the procedure that broadcasters ought to follow in order to acquire licences under the Act. That was in contrast to regulation 46(3) which had to do with frequencies that had already been assigned to broadcasters. That regulation appeared to be giving effect to sections 16, 17 and 18 of the Act all which contained extensive and expansive provision for the assignment of frequency spectrums by the 2nd respondent. That regulation as well, was properly grounded and had nexus with the objects of the Act, as well as the plurality and diversity considerations contained in section 46 D that the 2nd respondent was bound to uphold.
  7. The High Court fell into error when it stated that regulation 46(3) inclined to extend the period within which the permits issued in the old regime would remain valid. For example, if one was issued with a permit for a frequency for 10 years, in January 2007, then it meant that the permit would be in use till 2017. That in effect would be maintaining the status quo for a long time. It meant that those who had a monopoly of the frequencies would continue to hold onto them denying other interested players from entering the market. Rule 46(3) was made contrary to the 2nd Respondent’s mandate, the intent and objects of the Act and therefore made outside the scope of the 2ndRespondent’s jurisdiction.”
  8. Obiter dicta “Courts must make themselves aware of the new jurisprudential trend and avoid living in the annals of the dark legal history of this country which limited judicial intervention in judicial review and constitutional litigation through narrow and strict interpretation. We are past that stage, and any court clinging to the old approach would with utmost respect, be frowned upon.”

Appeal dismissed.

LABOUR LAW Withholding Emoluments of an Employee during suspension for unspecified period amounts to Unfair Labour Practice

Donald C. Avude v Kenya Forest Service
Industrial Court at Nairobi
Cause No 998 of 2014
Maureen Onyango J
January 26, 2015
Reported by Andrew Halonyere

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Brief Facts
The claimant brought an application before the High Court seeking inter-alia the following orders against the respondent.

  1. An order directing the respondent to unconditionally lift the suspension of the claimant from employment and order for his immediate reinstatement.
  2. An order for the payment by the respondent the claimant's withheld emoluments during that period of his suspension.

The respondent in response submitted that the claimant made certain public utterances in breach of certain clauses of the respondent’s Human Resource Policy and Manual and article 232, and 260 of the Constitution of Kenya, 2010. The respondent further stated that the claimant's utterances were in breach of the Public Officers Ethics Act sections 9(b), 16(2) and 20(1) and that as a result of the utterances it suspended the claimant.

Issues:

  1. Whether the respondents Manual and Human Resources Policies and Procedure Manual were in contravention of the Constitution of Kenya 2010, and the provisions of the Employment Act.
  2. Whether by withholding emoluments during suspension of an employee for an unspecified period amounts to unfair Labour practice.
  3. What is the difference between disciplinary suspension and administrative suspension.

Labour Law– suspension of an employee – where an employee was suspended from duty for an indefinite period in accordance with the respondents Manual and Human Resources Policies – whether the Human Resources Policies and Procedure Manual was in contravention of the Constitution of Kenya 2010, and the provisions of the Employment Act - whether by withholding emoluments during suspension of an employee for an unspecified period amounts to unfair Labour practice – Constitution of Kenya, 2010 - Employment Act section 44(4) (f) (g)

Labour Law- suspension of an employee - difference between disciplinary suspension and administrative suspension .Read More...

Held:

  1. According to Section 44 (4) (f) and (g) of the Employment Act, being charged with a criminal offence alone was not a ground for dismissal. It was a ground for dismissal only if the employee was not released within 14 days, or the offence was against the employer or the employer's property, the employer couldthen commence disciplinary proceedings against the claimant/applicant. In the instant case even if the claimant was to be convicted, the nature of the charges were such that they were unlikely to attract custodial sentences.
  2. Disciplinary suspension was defined as a punitive measure for a reproachable act made during work, while administrative suspension is a preventive measure which can be taken when the interest of the employer's business require it, even in the absence of an act made by the employee while working.
  3. The criteria for administrative suspension were as follows
    1. sufficient link between the reproached act and the type of employment; the nature of the accusations;
    2. the existence of reasonable grounds to believe that maintaining, even temporarily, the employment relationship would be prejudicial to the employer or to his reputation;
    3. the existence of immediate, important inconveniences that cannot be practically countered by alternate measures (for example: assigning the employee to another post); and,
    4. the necessity of protecting the public.
  4. The respondent's Manual at Clause 10.16.4 provided for suspension as follows:-
    1. Where an employee has been charged with a criminal offence, the employee would be suspended from the exercise of his duties by the Director pending consideration of the case.
    2. KFS would have the discretion to finalize such a case administratively separate from the court process if it was in view of KFS that the offence amounts to gross misconduct and is injurious to its interest or image.
    3. An employee who is suspended may not leave KFS without the permission of the Director or an officer who is empowered to give such permission.
  5. The said clauses were in contravention of article 41(1) of the Constitution which provided for the right to fair labour practices as well as sections 41 and 44 of the Employment Act as the clauses provided for suspension in the event of an employee being charged with any offence which would include an offence that did not affect the employer in any way, and minor offences such as traffic offences.
  6. Suspension of an employee was intended to enable an employer carry out investigations where the presence of the employee might jeopardize the investigations, or where an employee had been convicted and was awaiting sentence as provided for in the Public Service Code of Regulations, or where the employee had or was suspected of having committed a criminal offence to the substantial detriment of the employer as provided in section 44(4) (g) of the Employment Act. In all the aforesaidcircumstances, suspension should be for a determinate period where such suspension was without pay, otherwise it would constitute inhuman treatment especially in the case of the respondent's Manual where the employee was required to be at the place of work without a salary and for an indeterminate period.
  7. Withholding salary exposed the claimant to financial embarrassment that could not have been remedied by the mere release of the withheld salary.
  8. Where the respondent was carrying out valid disciplinary process, the normal situation would be that courts could not interfere in the respondent's exercise of its disciplinary process and could not give final orders at interlocutory stage of cases. The court would however intervene and if necessary, grant relief where the consequence of non-interference would be to subject the applicant to extreme hardship or irreparable harm, or in cases where the action by the respondent had no legal basis as was the case in the suit.
  9. The disciplinary action was premature, because the basis of the disciplinary process had not been established. Even if it had been established, it would not have been necessary to suspend the claimant/applicant as there would have been no investigations necessary to establish the facts that could not have beencarried out while the claimant was at work.
  10. Even if the court case was successful it would not warrant disciplinary action being taken against the claimant/applicant as the criminal charges were not connected with the claimant/applicant's employment. The employer would only have been subjected to disciplinary action if incarcerated for more than 14 days.
  11. The respondent failed to state the relevant provisions of the Constitution and the Public Officers Ethics Act that were alleged to have been infringed by the claimant/applicant or to demonstrate how the charges related to the claimant/applicant's obligations to the respondent.

Application allowed.
The disciplinary process against the claimant/applicant and the resultant suspension of the claimant/applicant was lifted. The claimant/applicant was directed to resume duty within 7 days from the date of the ruling.
The respondent to release to the claimant/applicant's emoluments withheld as a result of the suspension forthwith.
The respondent to pay the claimant's costs for the application.

CONSTITUTIONAL LAW Court rules due process not followed in impeaching Kisumu County Assembly Speaker

Kisumu County Assembly Service Board & another v Kisumu County Assembly Public Service Board & 4 others
Industrial Petition 297 of 2014
Industrial Court at Kisumu
H S Wasilwa, J
January 12, 2015
Reported by Nelson K Tunoi

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Brief facts
A petition challenging the procedure for removal from office of the Kisumu County Assembly Speaker was brought before the court. The petitioners sought declarations, inter alia, that the 1st respondent (Kisumu County Assembly Public Service Board) through its purported committee of the Whole House did not have power to suspend, dissolve or carry out the statutory functions of the petitioners and that the actions of the 1st respondent purporting to disband, dissolve and suspend the 1st petitioner (Kisumu County Assembly Service Board) and its membership as constituted amounted to an abuse of its constitutional and statutory mandate.
The 2nd petitioner submitted that her removal as County Assembly Speaker was done in contravention of the provisions of the law and without being accorded a reasonable opportunity to respond to any allegations levelled against her, hence infringing on her fundamental rights and freedoms. She further submitted that the proceedings of the County Assembly were being conducted in contravention of the Constitution and the power donated to the Assembly as a state organ to exercise its sovereign power of the people of Kenya.
The respondents on the other hand submitted that the 2nd petitioner was legally impeached after being accorded a chance to be heard on accusations levelled against her but declined to appear. They contended that no rights of the parties in the petition were infringed upon as claimed by the 2nd petitioner as all provisions of the law were observed in dealing with the parties.

Issues:

  1. Whether a County Assembly Service Board had locus to sue alleging violations of fundamental rights under article 22 of the Constitution.
  2. Whether the sittings of the County Assembly of Kisumu on the specified dates in the petition were within the confines of the law.
  3. Whether the process of impeaching the Speaker of Kisumu County Assembly was in accordance with the law.
  4. Whether the constitutional rights of the petitioners were infringed upon by the action of the respondents.
  5. Whether section 11 of the County Government Act and Standing Order No. 47, 58, 63 and 83 were unconstitutional as infringing article 21(1) of the Constitution.

Constitutional Law – enforcement of Bill of Rights – County Assembly Service Board – whether a County Assembly Service Board had locus standi to sue alleging breach of fundamental rights and freedoms – whether the constitutional rights of the petitioners were infringed upon by the action of the respondents - Constitution of Kenya, 2010, article 22

Constitutional Law – fundamental rights and freedoms – right to fair administrative action – removal of Speaker of County Assembly - whether the process of impeaching the Speaker of Kisumu County Assembly was in accordance with the law - whether section 11 of the County Government Act and Standing Order No. 47, 58, 63 and 83 were unconstitutional as infringing article 21(1) of the Constitution - whether the constitutional rights of the petitioners were infringed upon by the action of the respondents – Constitution of Kenya, 2010, articles 21(1), 47, 178; County Government Act, 2012, sections 11, 12, 13Read More...

Held:

  1. The County Assembly Service Board was recognized under section 12(2) of the County Government Act, 2012 as a body corporate with power to sue and be sued. Article 22 of the Constitution envisaged a situation where other than a person acting in their own interest, the person could act for another, or as a member or in the interest of a class or group of persons and also in the public interest or as an association acting in the interest of one or more of its members. Further, article 260 of the Constitution defined a “person” to include a company, association or other body of persons whether incorporated or unincorporated. Therefore, a person was beyond a natural human being and included corporate bodies. Going by the letter of the law and in recognition of the fact that the 1st respondent was a body corporate who also had members with rights, the 1st petitioner had locus to file the petition.
  2. The sittings of the County Assembly on the specified dates in the petition were not within the confines of the law if any. Section 21 of the Election Act detailed out how the election of the Speaker were to be held as per the First Schedule and the Standing Orders of the County Assembly. There was no indication that the provisions of the law were adhered to.
  3. The law on elections and removal of a Speaker of a County Assembly was set out in the Elections Act, the Constitution of Kenya and the County Government Act. The law envisaged that a notice was to be served to the 2nd petitioner before her removal as Speaker, which notice was to be signed by at least one third of the members of the County Assembly. Further, the notice was to be served at least 48 hours before the Motion was debated. In the circumstances, the 2nd petitioner was not legally, lawfully or constitutionally removed as the Speaker of the County Assembly as she was not accorded due process and the Assembly was presided over by strangers making any decisions arrived at a nullity.
  4. The illegalities meted on the petitioners were an infringement upon their right to fair administrative action (article 47 of the Constitution), right to fair labour practices (article 41 of the Constitution) and right to be treated with dignity (article 10 of the Constitution) among other provisions or regulations as stated in the petition. The interested parties were also unfairly treated by being removed as Clerk and Deputy Clerk without being accorded any hearing and by being deployed by unqualified persons.
  5. The petitioners had not demonstrated the unconstitutionality of section 11 of County Government Act in as far as article 21(1) of the Constitution of Kenya dealing with the manner in which the rights and fundamental freedoms were to be implemented by the State and every State organ. Section 11 of the County Government Act was very elaborate on the procedure for removal of Speaker of the County Assembly and the procedure included subjection to due process which was envisaged under the Constitution.

Petition allowed in part with costs to the petitioners.

CONSTITUTIONAL LAW Court Rules the Functions of the County Public Service Boards Have Not Been Usurped By the Capacity Assessment and Rationalization of the Public Service (CARPS) Programme

Kenya County Government Workers Union v Kisumu County Government & 91 others
Petition 270 of 2014
Industrial Court at Kisumu
H S Wasilwa, J
January 12, 2015
Reported by Nelson K Tunoi

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Brief facts
The petitioner (Kenya County Government Workers Union) was a body representing the workers and staff of all the County Governments (respondents) in Kenya, and claimed to have exclusive right in handling of staff issues serving under the respective County Governments and not the National Government. Following the commencement of the Capacity Assessment and Rationalization of the Public Service (CARPS) programme by the respondents, the petitioners filed a petition contending that the actions of the respondents would breach or threaten to breach the rights of the petitioners and its members. The petition sought, inter alia, conservatory orders of injunction against the respondents jointly and severally through any committees established under the CARPS programme from dealing with deployment, redeployment, termination or promotion or in any manner dealing with staff issues that were members of petitioner and workers of the County Government who were respondents, and that pending the hearing and determination of the petition, the respondents be prohibited jointly and severally through any committees from carrying out any duties of biometric data capturing of members of the petitioner who were workers of the County Governments until the law was complied with.

Issues:

  1. Whether the Capacity Assessment and Rationalization of the Public Service (CARPS) programme was being implemented by the National Government without consideration and support of the County Governments
  2. Whether the implementation of the CARPS programme infringed on the rights of the petitioners.
  3. Whether the CARPS programme had usurped the powers of the County Public Service Boards.
  4. Whether the non-inclusion of the petitioner to the membership of the various committees established under the CARPS programme was discriminatory.
  5. Whether the CARPS programme discriminated upon certain members of the petitioner.

Constitutional Law – fundamental rights and freedoms – right to fair labour practices and right to equal protection and benefit of the law to all persons – whether the implementation of the Capacity Assessment and Rationalization of the Public Service (CARPS) programme infringed on the rights of the petitioner and some of its members – where the petitioner was a representative of all staff and workers of the respective County Governments – whether the non-inclusion of the petitioner to the various committees established under the CARPS programme was discriminatory – Constitution of Kenya, 2010, articles 27, 41, 232(1), 235(1) & 236

Constitutional Law – devolution – implementation of the Capacity Assessment and Rationalization of the Public Service (CARPS) programme at National and County Governments level - whether the CARPS programme had usurped the powers of the County Public Service Boards – Constitution of Kenya, 2010, article 6(2); County Government Act, 2012, section 57; Inter-Governmental Relation Act, 2012, sections 7, 8 & 23 Read More...

Held:

  1. The nobility of the Capacity Assessment and Rationalization of the Public Service (CARPS) programme could not be underestimated. The respondents submitted that they were part and parcel of the programme and supported it fully as being complementary to their role and function. It was therefore not true that the CARPS programme was being implemented by the National Government exclusive to the County Government.
  2. Article 41 of the Constitution envisaged a right to fair labour practices including a right to form, join or participate in the activities and programmes of a trade union. If any person chose to join a trade union then it was that union that was expected to represent them in any decision the employer chose to effect against or for the employee.
  3. The CARPS Manual at Annex 1 stated the membership to its various committees. A representative from the County Government Workers Union was among the members. If however the petitioner had been excluded in the actual formation of the committee, then the rights of the petitioner's members would have either been infringed upon or threatened with infringement and that situation should of necessity be corrected.
  4. The County Public Service Boards formed part of the membership of the CARPS programme and hence had locus to complain about such an omission from the membership, if any. Therefore the functions of the County Public Service Boards had not been usurped by the CARPS programme.
  5. If at all the petitioners had been excluded from membership of the technical committees established under the CARPS programme, that would amount to discrimination as the manual envisaged that they should be members. The assertion that the petitioners could not be members because they had no Collective Bargaining Agreement (CBA) with the various respondents could not stand as that was still and could have been the position when the manual was put in place and that was coming in the transition period before structures were fully established.
  6. The Constitution under article 27 provided for equal protection and benefit of the law to all persons. Therefore, there should be no discrimination against any employee whether on suspension or whether facing any disciplinary proceedings or on leave.

Orders:

  • That the petitioners be included in the committees set up under the CARPS programme as envisaged by the law in order to cater for the rights of their members.
  • The tools for data capture to include all workers, the petitioner’s members whether on suspension or facing any disciplinary proceedings or whether on leave.
  • The order granted stopping the whole CARPS programme against the respondents be lifted forthwith on conditions granted under (i) and (ii) above.
  • Each party to bear own costs as the matter was of great public interest.
EMPLOYMENT LAW The enforceability of an unregistered Collective Bargaining Agreement

Said Ndege v Steel Makers Ltd
Cause 158 of 2013
Industrial Court at Mombasa
(Bima Towers)
Radido Stephen, J
March 14, 2014
Reported by Beryl A Ikamari

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Brief facts
In a claim for unfair termination of his employment contract, the Claimant sought leave to refer to a Collective Bargaining Agreement which was unregistered. The Collective Bargaining Agreement was entered into by the Respondent (the employer) and the Kenya Engineering Workers Union (the Union) on September 23, 2011 and was effective from January 1, 2011 for two years.
Further to that agreement, the Respondent deducted Kshs. 338 from the Claimant's wages on a monthly basis. The Collective Bargaining Agreement was not registered as required by section 60 of the Labour Relations Act, 2007.
In opposition to the Application for leave, the Respondent argued that the Collective Bargaining Agreement was unregistered, and that it was the Union's role to litigate over the terms of the Collective Bargaining Agreement, not the Claimant as an individual, and that the Union ought to have been joined as party to the suit.

Issues:

  1. Whether a Collective Bargaining Agreement, which had not been submitted for registration by an employer, was legally enforceable.
  2. Whether an individual employee, without the involvement of the Union, could seek to rely on a Collective Bargaining Agreement in the context of litigation.

Employment Law-labour relations-Collective Bargaining Agreement-whether an unregistered Collective Bargaining Agreement was enforceable-Labour Relations Act, 2007, sections 2, 59(5) & 60; Employment Act, 2007, section 2.

Employment Law-labour relations-Collective Bargaining Agreement-whether, in the context of litigation, an employee could rely on a Collective Bargaining Agreement without the involvement of the Union- Constitution of Kenya 2010, articles 20 & 259; Labour Relations Act, 2007, sections 2, 59(1)(b) & 49(5).Read More...

Held:

  1. A Collective Agreement was defined under section 2 of the Labour Relations Act, 2007 to mean a written agreement concerning any terms and conditions of employment made between a trade union and an employer, group of employers or organisation of employers. Further, section 2 of the Employment Act, 2007 defined a Collective Agreement to mean a registered agreement concerning any terms and conditions of employment made in writing between a trade union and an employer, group of employers or employer’s organisation.
  2. Pursuant to section 59(5) of the Labour Relations Act, 2007, a Collective Agreement would become enforceable and be implemented upon registration by the Industrial Court. Under section 60 of the Labour Relations Act, 2007, the primary obligation to submit a Collective Agreement for registration was borne by the employer. Submission for registration was to be done within 14 days of the conclusion of the agreement.
  3. Under the Industrial Court (Procedure) Rules 2010, the Minister (Cabinet Secretary) could object to the registration of a Collective Agreement.
  4. The Industrial Court was both a Court of law and a Court of Equity. Equity would move in to moderate and constrain unfair dealing where consequences arose from the conduct of a party, such as the Respondent who failed to comply with a statutory obligation for unexplained reasons.
  5. Justice would not be disregarded at the expense of technicalities. In industrial relations parties were referred to as social partners who were not to go back on explicit promises made to each other whether registered or not.
  6. General principles of law governing the enforceability of common law agreements could not be invoked by parties to non-registered Collective Agreements.
  7. Articles 20 and 259 of the Constitution of Kenya 2010 enjoined the Court to develop the law to the extent that the law did not give effect to a right or fundamental freedom and to interpret the Constitution in a manner that promoted its values and principles and permitted the development of the law.
  8. Considering the principles of equity and the need to develop the law and indigenous jurisprudence, an employer who failed or neglected to cause a Collective Bargaining Agreement to be registered could not be allowed to plead or claim protection or statutory enforceability of such a Collective Bargaining Agreement. In the circumstances, the Collective Bargaining Agreement was legally enforceable.
  9. A reading of sections 2 and 59(1)(b) of the Labour Relations Act, 2007, led to the conclusion that the terms of a Collective Bargaining Agreement were binding and were incorporated into the employment contract of all union members and unionizable employees, provided that the employer entered into a recognition agreement with the Union.
  10. Under section 49(5) of the Labour Relations Act, 2007, an employee who resigned from a Union would pay an agency fee and would be legally entitled to rely on a term of a Collective Agreement to enforce or pursue his rights.
  11. Although it would be undesirable, an employee could rely on the terms of a Collective Agreement without involving the Union.
Application allowed.