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Court of AppealPartially AllowedCivil Case No. 125 of 1996

Dalmas B. Ogoye v K.N.T.C. Ltd

Court of Appeal
8 October 1996
RKR.O. KwachAAA.M. AkiwumiASA.B. Shah
0 words in judgment
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The bottom line

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Kenya's Court of Appeal confirmed that wrongfully dismissed employees get money damages only, not reinstatement or compensation for emotional distress.

What this practically means

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Executive summary

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The appellant, formerly Depot Manager of the Kenya National Trading Corporation at Mombasa, sued for wrongful dismissal after his appointment was terminated by the Managing Director on 22nd May, 1987 on allegations of malpractice in selling sugar below authorised prices. The High Court (Githinji J) found the dismissal unlawful, holding that the Managing Director had no power to dismiss an officer of the appellant's rank, and awarded him salary up to 16th July, 1987 (the date the Board ratified the termination), three months' salary in lieu of notice, salary for earned leave, and the surrender value of his pension contribution, with costs. The appellant, appearing in person, appealed contending the judge should have ordered reinstatement and awarded damages for mental anguish and distress. The Court of Appeal dismissed the appeal save for one variation. It held that the only remedy in a claim for wrongful dismissal is damages; courts do not order reinstatement because such an order would be difficult to enforce and it would be wrong to impose an employee who has fallen out of favour on a reluctant employer. Damages for mental anguish and distress are likewise not recoverable in an action for unlawful dismissal. The court found the notice pay had been computed on basic rather than net salary, increasing the balance due to Shs. 38,102.10, payable with interest at 14% p.a. from 16th July, 1987. The pension complaint failed as full payment was evidenced. Although costs normally follow the event, no order as to costs was made because the appellant appeared in person and had in fact suffered wrongful dismissal.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether the trial judge erred in declining to order the appellant's reinstatement following his unlawful dismissal
  2. 2.Whether the appellant was entitled to damages for mental anguish and distress arising from the unlawful termination
  3. 3.Whether the appellant had been paid his full benefits under the pension fund
  4. 4.Whether the amount payable in lieu of notice should have been computed on net rather than basic salary

Key legal issues

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01

Whether reinstatement is an available remedy for wrongful dismissal

Holding

Reinstatement is not available; damages are the sole remedy for wrongful dismissal.

Reasoning

The court upheld the judge's award of damages in lieu of reinstatement. It reasoned that an order for reinstatement would be difficult to enforce, and that it would be plainly wrong to impose an employee who has fallen out of favour on a reluctant employer. The employment relationship having broken down, the law confines the wrongfully dismissed employee to monetary compensation.

p. 2
02

Whether damages for mental anguish and distress are recoverable for unlawful dismissal

Holding

They are not recoverable in an action for unlawful dismissal.

Reasoning

Although the court accepted that the appellant must have been distressed by the manner of his dismissal, it held that distress of that kind does not sound in damages in a wrongful dismissal action. The measure of recovery remains contractual: what the employee would have received had the contract been lawfully terminated.

p. 2
03

The effective date of termination and measure of damages

Holding

The effective date of termination was 16th July, 1987 when the Board terminated the appointment without notice; the appellant was entitled to three months' salary in lieu of notice computed on his net salary of Shs. 9,190/- per month.

Reasoning

The Managing Director lacked power to dismiss the appellant, and the Board's ratification was also unlawful because the contract required three months' notice or salary in lieu. The appellant therefore remained employed with full benefits until 16th July, 1987. The notice pay had been computed on basic rather than net salary, leaving an underpayment of Shs. 11,028/-, raising the balance due to Shs. 38,102.10 with interest at 14% p.a.

p. 2

Legal principles established

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  • In a claim for wrongful dismissal the only remedy is damages; courts will not order reinstatement because such an order is difficult to enforce and it would be wrong to impose an employee on a reluctant employer.
  • Damages for mental anguish and distress are not recoverable in an action for unlawful dismissal.
  • Where an appointment is unlawfully terminated, the employee is entitled only to the damages that would have put him in the position had the contract been ended in the manner stipulated in the contract of service.

Court orders

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  1. 1.The appeal is dismissed except for the minor variation regarding the amount payable in lieu of notice
  2. 2.The respondent to pay the appellant the balance of Shs. 38,102.10 together with interest at 14% p.a. from 16th July, 1987, on or before 22nd October, 1996, and in default execution to issue
  3. 3.No order as to costs - each party to bear their own costs

The bench

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One judgment of the whole court — no separate or dissenting opinions.

RK
majority
AA
majority
AS
majority
On appeal from
High Court of Kenya at Nairobi
H.C.C.C. No. 2687 of 1989
Jurisdiction invoked
First appeal to the Court of Appeal against a judgment of the High Court (no specific constitutional/statutory provision stated in the judgment)

Relief refused

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Order for reinstatement

The only remedy in a claim for wrongful dismissal is damages; reinstatement would be difficult to enforce and it would be wrong to impose an employee on a reluctant employer

p. 2

Damages for mental anguish and distress

Such damages are not recoverable in an action for unlawful dismissal

p. 2

Claim for unpaid pension fund benefits

Evidence of full payment was produced by the respondent

p. 2

Costs

Appeal dismissed with no order as to costs; each party to bear their own costs, the court declining to order costs against the appellant because he appeared in person and did in fact suffer wrongful dismissal.

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

The only remedy in a claim for wrongful dismissal is damages. Courts do not order reinstatement in such cases because such an order would be difficult to enforce.
p. 2Remedy for wrongful dismissal
Beside, it would be plainly wrong to impose an employee who has fallen out of favour on a reluctant employer.
p. 2Reinstatement refused
he cannot recover damages for this because such damages are not recoverable in action for unlawful dismissal.
p. 2No damages for mental anguish
Finally, we hereby order the respondent to pay the appellant the balance of Shs. 38,102.10 together with interest at 14% p.a. from 16th July, 1987, on or before 22nd October, 1996, and in default execution to issue.
p. 2Final orders
Although costs normally follow the event, we have decided not to make an order for the costs against the appellant because he appeared in person and did in fact suffer wrongful dismissal at the hands of the respondent.
p. 2Costs

Issues in the judgment

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minor

The judgment is internally inconsistent on the arithmetic of the notice-pay underpayment: it states the total should be Shs. 27,520/- yet the underpayment is given as Shs. 11,028/-, and the final balance is computed as Shs. 38,102.10.

minor

The judgment header describes the appeal as 'CIVIL CASE NO. 125 OF 1996' rather than a civil appeal number, and the notice of appeal date is not stated.

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (5)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Dalmas B. Ogoye v K.N.T.C. Ltd", Case Analysis (1996). Civil Case No. 125 of 1996. Source:

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.