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Court of AppealPartially AllowedCivil Appeal No 120 of 1997· [1997] KECA 388 (KLR)

Kenya Ports Authority v Otieno (Civil Appeal 120 of 1997) [1997] KECA 388 (KLR)

Court of Appeal of Kenya
19 September 1997
2,015 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Court of Appeal ruled that wrongfully dismissed employees cannot get damages for hurt feelings—only wages for the notice period and properly computed benefits.

What this practically means

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Executive summary

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This was a first appeal to the Court of Appeal by the Kenya Ports Authority against awards made by Oguk, J in favour of a former employee, Mr Otieno, who had been retired at age 51 under Regulation 6(1) of the Kenya Ports Authority (Pensions) Regulations 1983. The trial judge had held the retirement wrongful for breach of natural justice (failure to give the employee a hearing under Regulation B11 of the Revised Staff Regulations 1992) and awarded damages based on six months' earnings, Kshs 100,000/= for shock and distress, various lost allowances, and pension computed as if retirement had occurred at 55. The Court of Appeal allowed the appeal in substantial part. Applying Addis v Gramophone Company and Shore v Downs Surgical, it held that damages for wrongful dismissal cannot include compensation for the manner of dismissal or injured feelings, and found nothing in the Employment Act, cap 226 modifying that rule in Kenya; the Kshs 100,000/= award was set aside. Following Rift Valley Textiles v Oganda, it held that where the contract provides a notice period, damages are limited to wages for that period, and the claimed allowances attach only to those in actual employment; those awards were also set aside. The Court held the pension should be computed at the actual retirement age of 51, yielding Kshs 8,737.85 monthly. The superior court's decree of September 27, 1995 was set aside and substituted with judgment for Kshs 200,000/= for transport of personal effects, the revised pension, and costs of the suit to the defendant. The appeal was allowed with costs, with no order as to costs of the cross-appeal.

Key legal issues

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01

Recoverability of damages for shock and distress in wrongful dismissal

Holding

The award of Kshs 100,000/= for shock and distress was erroneous and was set aside; the Addis principle applies in Kenya.

Reasoning

The House of Lords in Addis v Gramophone Company decisively rejected damages for the manner of dismissal or injured feelings. Shore v Downs Surgical applied Addis to refuse damages for distress from a brusque dismissal. The Court found nothing in the Employment Act, cap 226 abrogating or modifying these general principles, so they apply to Kenyan contracts of employment.

p. 3
02

Measure of damages where the contract provides a notice period

Holding

Damages are limited to wages for the contractual notice period; the retiree is not entitled to the various allowances claimed, which attach to those in actual employment.

Reasoning

Relying on Rift Valley Textiles Limited v Edward Onyango Oganda, where the contract provides for notice or payment in lieu, an unlawfully dismissed employee who has been paid in lieu has received all he is entitled to under the contract. Awards of post-termination emoluments would amount to reinstatement, to which a wrongfully retired employee is not entitled.

p. 4
03

Computation of pension benefits

Holding

Pension must be computed on retirement at age 51, yielding a monthly pension of Kshs 8,737.85, subject to review under the Kenya Ports Authority Act and Pension Regulations.

Reasoning

The trial judge had computed retirement benefits as if the respondent had been retired at 55. Since the lawful retirement took effect at 51, the correct basis is the actual age of retirement, with the pension payable for life and thereafter to the family for five years under the pension regulations.

p. 4

Legal principles established

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  • Damages for wrongful dismissal or retirement in Kenya cannot include compensation for the manner of dismissal, injured feelings, or distress; the Addis v Gramophone principle applies in Kenya.
  • Where a contract of service provides a notice period, damages for wrongful termination are limited to the wages for that notice period, and no further benefits or emoluments are payable.
  • Retirement benefits must be computed at the age at which the employee was actually retired, not the age he would have attained had he remained in employment.

Court orders

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  1. 1.The appeal is allowed with costs, with no order as to costs of the cross-appeal
  2. 2.The decree of the superior court given on September 27, 1995 is set aside
  3. 3.Judgment entered for the plaintiff in the sum of Kshs 200,000/= being loss of transport of personal effects to home of origin
  4. 4.The plaintiff to draw monthly pension at the rate of Kshs 8,737.85 for life and thereafter his family for 5 years, subject to review under the Kenya Ports Authority Act and Pension Regulations
  5. 5.The plaintiff shall pay to the defendant the costs of the suit

Authorities

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Legislation

  • Kenya Ports Authority (Pensions) RegulationsRegulation 6(1)
  • Kenya Ports Authority Revised Staff RegulationsRegulation B11
  • Employment Actcap 226
  • Kenya Ports Authority Act

Cases cited (3)

  • Addis v Gramophone Company
    [1909] AC 488
  • Shore v Downs Surgical
    [1984] 1 All ER 7
  • Rift Valley Textiles Limited v Edward Onyango Oganda
    Civil Appeal No 27 of 1992 (unreported)
On appeal from
High Court of Kenya (superior court)
Jurisdiction invoked
First appeal to the Court of Appeal under the applicable appellate statute (not expressly cited in the judgment)

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Kenya Ports Authority v Otieno (Civil Appeal 120 of 1997) [1997] KECA 388 (KLR)", Case Analysis (1997). Civil Appeal No 120 of 1997. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/1997/388/eng@1997-09-19

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