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Court of AppealPartially AllowedCivil Appeal No. 17 of 2018· [2020] KECA 730 (KLR)

Computer Revolution Africa Ltd v Antony Mwai Munyi [2020] KECA 730 (KLR)

Court of Appeal
24 April 2020
6,002 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 cut a sacked manager's award because courts can only grant reliefs actually claimed, but confirmed employers must still follow fair dismissal procedures.

What this practically means

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Executive summary

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The respondent was employed by the appellant as country manager in Ethiopia and tendered a three-month resignation notice on 14th September 2012. Shortly after, he sent an email to Microsoft Corporation transmitting a colleague's confession about a falsified tender document and describing his employer as 'fraudsters'. The appellant summarily dismissed him and counterclaimed for a car loan and unpaid imprest. The ELRC (Mbaru, J.) found the dismissal wrongful and procedurally unfair and awarded the respondent salary for 20 days worked, notice pay, service pay and a further amount, dismissing the counterclaim. The appellant appealed on ten grounds. The Court of Appeal framed three issues: whether unpleaded reliefs were granted, whether the dismissal was wrongful and unfair, and whether the counterclaim was properly dismissed. The Court held that the trial Judge erred in awarding service pay and a further notice-pay award that were neither pleaded nor prayed for, since the respondent's claim was premised on resignation, not wrongful termination. On the dismissal, the Court agreed that the respondent's breach of confidentiality and disparagement of his employer justified dismissal, but upheld the finding that the termination was procedurally unfair under section 41 of the Employment Act because the termination letter was not served before the dismissal decision was made. The dismissal of the counterclaim for imprest was upheld for want of proof, save for the admitted Kshs.300,000 car loan set-off. The appeal partially succeeded: awards of service pay and unpleaded notice pay were set aside, leaving a net award of Kshs.700,033.40 to the respondent, with each party bearing its own costs.

Key legal issues

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01

Award of unpleaded reliefs

Holding

The Judge erred in awarding service pay and notice pay that were neither pleaded nor prayed for

Reasoning

The respondent's claim was premised on resignation and entitlement to notice-period salary and commissions, not wrongful termination. Awards for 3 months' salary in lieu of notice based on unfair termination and service pay had no basis in the pleadings or prayers. The adversarial system requires parties to set the agenda by their pleadings; awards on unpleaded issues deny a party a fair hearing.

p. 5
02

Justifiability and procedural fairness of the summary dismissal

Holding

The dismissal was substantively justified by the respondent's breach of confidentiality, but procedurally unfair for want of compliance with section 41 of the Employment Act

Reasoning

The respondent divulged confidential information and labelled his employer a fraudster, eroding trust; his apologies were not made under duress. However, the termination letter was not served before the decision was made, so the hearing before the board was futile. Procedural requirements of section 41 apply regardless of the gravity of the misconduct.

p. 6
03

The counterclaim for unpaid imprest

Holding

The dismissal of the counterclaim (apart from the admitted car loan set-off) was correct

Reasoning

The burden lay on the appellant to establish the counterclaim on a balance of probabilities. The acknowledgments bearing the respondent's signature were alleged forgeries, bore the same date as the dismissal letter, and were not referenced in a subsequent demand letter. The ledgers and vouchers were not self-explanatory and the Finance Manager who was conversant with the accounts was not called.

p. 7

Legal principles established

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  • Courts must determine cases based on issues arising from the pleadings and may not award reliefs that were neither pleaded nor prayed for
  • A court may exceptionally determine an unpleaded issue where evidence is led and the parties leave the issue to the court
  • Procedural fairness under section 41 of the Employment Act applies even where gross misconduct justifies dismissal; an employer cannot dispense with due process
  • An employer may terminate an employee's employment during a notice period following resignation where trust has been justifiably eroded

Court orders

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  1. 1.Upheld the award of Kshs.167,593.40 for 20 days' salary worked in September 2012
  2. 2.Upheld the award of Kshs.832,440.00 being gross salary for the notice period
  3. 3.Set aside the award of Kshs.138,740.00 for service pay
  4. 4.Set aside the further award of Kshs.832,440.00 that had not been sought
  5. 5.Directed that the net amount of Kshs.700,033.40 (after set-off of the admitted Kshs.300,000.00) be payable to the respondent
  6. 6.Ordered that each party bear its own costs of the appeal as well as the costs of the suit and counterclaim in the lower court

Authorities

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Legislation

  • Employment Act, 2007Section 41
  • Employment Act, 2007Section 41(2)
  • Employment Act, 2007Section 44
  • Employment Act, 2007Section 35
  • Employment Act, 2007Section 49

Cases cited (9)

  • Francis Nyongesa Kweyu vs. Eldoret Water Sanitation Company Limited
    [2017] eKLR
  • Dr. Thuo Mathenge vs. IEBC and another
    C.A. No. 103 of 2017
  • Caltex Oil (Kenya) Limited vs. Rono Limited
    [2016] eKLR
  • Kenya Commercial Bank Ltd vs. Sheikh Osman Mohammed
    CA No. 179 of 2010
  • Independent Electoral and Boundaries Commission & Another vs. Stephen Mutinda Mule & 3 others
    [2014] eKLR
  • Odd Jobs vs. Mubea
    [1970] EA 476
  • Judicial Service Commission & another vs. Francis Gitau Muraya
    [2019] eKLR
  • Selle vs. Associated Motor Boat Co Ltd
    [1968] EA 123
  • Kiliopa Omukuba Okutoyi versus Telkom Kenya
    [2012] eKLR
On appeal from
Employment and Labour Relations Court at Nairobi
ELRC Cause No. 338 of 2013
Jurisdiction invoked
First appeal to the Court of Appeal under the Court of Appeal's appellate jurisdiction

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, "Computer Revolution Africa Ltd v Antony Mwai Munyi [2020] KECA 730 (KLR)", Case Analysis (2020). Civil Appeal No. 17 of 2018. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2020/730/eng@2020-04-24

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