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Court of AppealDismissedCivil Appeal 245 of 2016· [2022] KECA 827 (KLR)

Nature Pharmacy Ltd & another v Gichuhi

Court of Appeal
27 May 2022
4,475 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~18 min to read original · ~4 min brief

The bottom line

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Kenya's Court of Appeal confirmed that ignoring your lawsuit until judgment is entered can cost you the case, even if you blame your lawyer.

What this practically means

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Executive summary

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The Court of Appeal (Musinga, P, Asike-Makhandia and M'inoti, JJA) dismissed an appeal against an ELRC ruling that had refused to set aside a default judgment entered against Nature Pharmacy Ltd and its director, Ndubai Ngeera, in an unfair termination claim by Samuel Maina Gichuhi. The appellants, who had counsel on record, failed to file a defence; judgment was entered in default and the cause proceeded by formal proof, resulting in an award of Kshs.429,000. Their subsequent application to set aside the judgment, be heard inter partes, file a defence and strike out the 2nd appellant was dismissed by the trial court. The appellate court framed four issues: whether the trial court's discretion was properly exercised; whether mistakes of counsel should be visited on the client; whether the 2nd appellant was wrongly joined; and whether the appellants' fair-hearing rights were violated. Applying Mbogo v Shah, the court found no misdirection in the trial court's ruling. It held that the discretion to excuse counsel's mistakes is not automatic; parties must follow up their cases, and the negligent party's remedy lies against its erstwhile advocates (Omwoyo v African Highlands). Article 159(2)(d) does not oust litigants' obligation to comply with procedure (Raila Odinga v IEBC; Salat v IEBC), and Article 50 did not aid the appellants since they were served and their counsel was present at formal proof. The joinder of the director was proper under Order 1 rule 3. The appeal was dismissed in its entirety with costs to the respondent.

Key legal issues

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01

Exercise of discretion in setting aside ex parte judgments

Holding

The trial court's discretion was properly exercised; the appellate court discerned no misdirection and the ruling was legally sound.

Reasoning

Discretion must be based on sound principles, not sentiment or sympathy. The Mbogo v Shah standard applies: interference only where the trial court misdirected itself on law, misapprehended facts, took into account or failed to take into account relevant considerations, or was plainly wrong. The ruling showed none of these defects.

p. 4
02

Mistakes of counsel

Holding

Mistakes of counsel are not automatically excusable; parties must show interest in and follow up their cases, and the negligent party's remedy is against its advocates.

Reasoning

While courts readily excuse counsel's mistakes where it affords just and expeditious disposal, the discretion is not automatic. Counsel owes duties to the court and the other side. The appellants had advocates on record, gave no explanation for the failure to file a defence, and made no follow-up; Omwoyo v African Highlands confirms the remedy is professional negligence against the advocates.

p. 5
03

Fair hearing under Article 50

Holding

Article 50 did not aid the appellants; due process was followed as they were served and their counsel was in court on the day of formal proof.

Reasoning

The right to a fair trial is cardinal, but fairness must apply to both parties. The record showed the appellants were served with pleadings, had counsel on record, and their counsel was present at formal proof. They did nothing until after judgment and service of the bill of costs, so they cannot claim they were not accorded an opportunity to be heard.

p. 6
04

Article 159(2)(d) and procedural technicalities

Holding

Article 159(2)(d) was never meant to oust litigants' obligation to comply with procedural imperatives; failure to file a defence cannot be cured by it.

Reasoning

Adopting the Supreme Court's observation in Raila Odinga v IEBC, the provision means courts should not pay undue attention to procedure at the expense of substantive justice, but it does not excuse non-compliance. Salat v IEBC reinforces that rules and timelines must be honoured and courts must not provide succour to parties who exhibit scant respect for them.

p. 6
05

Joinder of the 2nd appellant

Holding

The 2nd appellant was properly joined; any party linked to the transaction may be joined, and misjoinder does not defeat a suit under Order 1 rule 9.

Reasoning

Order 1 rule 3 permits joinder of all persons against whom relief is alleged arising from the same transaction. The respondent's case was that the 2nd appellant was the owner/director of the 1st appellant and the only person known to him at employment. If disputing liability, he should have taken steps to exonerate himself; the prayer was not available at that stage and no prejudice was occasioned.

p. 7
06

Right to be heard versus expeditious disposal

Holding

The right to be heard cannot be lauded at the expense of the right to expeditious determination; laxity leads to delay and prejudice.

Reasoning

Proportionality is required; courts' inherent jurisdiction to dismiss suits must protect the integrity of the process from abuse amounting to injustice. Rules and timelines serve certainty and case management. Weighing the appellants' laxity against the manner of the respondent's termination, the respondent would ideally suffer prejudice were the orders sought granted.

p. 8

Legal principles established

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  • The Court of Appeal interferes with a trial court's exercise of discretion only on established grounds: misdirection on law, misapprehension of facts, wrong considerations taken or omitted, or a plainly wrong decision.
  • Article 159(2)(d) does not oust the obligation of litigants to comply with procedural imperatives; parties cannot hide behind it to excuse failure to file a defence or follow up their cases.
  • A party who fails to follow up their case after instructing counsel cannot hide behind the mantra that mistakes of counsel should not be visited on them; the remedy lies against the negligent advocates.
  • An application to set aside an ex parte judgment must annex a draft defence to enable the trial court to exercise its discretion properly.
  • Any party linked to the act or transaction giving rise to the suit may be joined as a defendant under Order 1 rule 3 of the Civil Procedure Rules.

Court orders

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  1. 1.The appeal is dismissed in its entirety
  2. 2.The respondent shall have the costs of the appeal

Authorities

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Legislation

  • Constitution of KenyaArticle 159(2)(d)
  • Constitution of KenyaArticle 50(1)
  • Employment Act, 2007Section 40
  • Employment Act, 2007Section 49
  • Civil Procedure Act
  • Civil Procedure RulesOrder 1, rule 3
  • Civil Procedure RulesOrder 1, rule 9

Cases cited (13)

  • Hosea Kiplagat Vs. John Allan Okwema
    [2018] eKLR

    Mistake of counsel is excusable, especially if the wrong can be righted by an award of costs

  • Martha Wangari Karua Vs. Independent and Electoral Boundaries Commission & Others
    [2018] eKLR

    No litigant should be driven from the seat of justice without being heard, however weak the case

  • Sebei District Administration Vs. Gasyali & Others
    (1968) EA 300

    Prejudice can be adequately compensated by an award of costs

  • Murtaza Hussein Bandali T/A Shimoni Enterprises Vs. P. A. Wills
    [1991] KLR 469

    Judicial discretion must be based on sound principles, not sentiment or sympathy

  • Mbogo Vs. Shah
    [1968] EA 93

    Discretion to set aside ex parte judgment is exercised to avoid injustice from accident, inadvertence or excusable mistake, not to assist obstruction or delay

  • Tana and Athi Rivers Development Authority Vs. Jeremiah Kimigho Mwakio & 3 Others
    [2015] eKLR

    Courts readily excuse a mistake of counsel but the exercise of such discretion is by no means automatic

  • Re Jones
    [1870], 6 Ch. App 497

    Court's expectations of counsel's duty, cited within Tana & Athi Rivers Development Authority quotation

  • Omwoyo Vs. African Highlands & Produce Co. Ltd
    [2002] 1 KLR

    Legal practitioners should shoulder consequences of their negligence; remedy is against erstwhile advocates, not setting aside judgment

  • M K Vs. M W M & Another
    [2015] eKLR

    Importance of observing rules of natural justice, quoting Onyango v Attorney General

  • Onyango Vs. Attorney General
    (1986-1989) EA 456

    A decision in breach of the rules of natural justice is not cured by holding that the decision would otherwise have been right

  • Raila Odinga Vs. I.E.B.C & Others
    [2013] eKLR

    Article 159(2)(d) was never meant to oust the obligation of litigants to comply with procedural imperatives

  • Nairobi City Council Vs. Thabiti Enterprises Limited
    Civil Appeal No. 264 of 1996 (UR)

    The system of pleadings defines and delimits the real matters in controversy between the parties

  • Nicholas Kiptoo Arap Korir Salat Vs. Independent Electoral and Boundaries Commission and 6 Others
    [2013] eKLR

    Article 159 and the oxygen principles were never meant to destroy rules of procedure or aid parties with scant respect for rules and timelines

On appeal from
Employment and Labour Relations Court of Kenya at Nairobi
ELRC Cause No. 2007 of 2013
Jurisdiction invoked
Appellate jurisdiction of the Court of Appeal over the ELRC (Article 164(1)(a) framework; judgment does not state the provision expressly)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (2)

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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, "Nature Pharmacy Ltd & another v Gichuhi", Case Analysis (2022). Civil Appeal 245 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2022/827/eng@2022-05-27

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