Hhi Management Services Limited v Steve Okeyo & 1 other
The bottom line
#The Court of Appeal refused to pause an employment case, ruling that a win on appeal later could fix any harm through costs.
What this practically means
#Executive summary
#Key legal issues
#Whether the applicant demonstrated an arguable appeal under rule 5(2)(b)
The Court found the appeal arguable on the enforceability of arbitration clauses in employment contracts in light of Article 159(2)(c) of the Constitution and prior decisions.
The applicant's intended appeal raises the question whether section 15 of the Employment and Labour Relations Court Act excludes arbitration for employment disputes and whether section 26 of the Employment Act renders such clauses unenforceable. A single bona fide arguable ground suffices; the appeal need not succeed. The Court expressly declined to make definitive findings of law at the interlocutory stage.
Whether the intended appeal would be rendered nugatory if a stay is not granted
The Court found no nugatory prejudice: a mediation settlement is the product of the parties themselves, and a successful appeal after trial would render the trial decision a nullity for want of jurisdiction, a reversible outcome compensable by costs.
Under Reliance Bank Ltd v Norlake Investments Ltd, nugatory-ness is assessed case by case balancing conflicting claims. The applicant only asserted loss of the arbitration opportunity. The Court held the consequences of trial would be reversible and compensable by an award of costs, and that the applicant could not be prejudiced by a settlement it helped formulate. The discretionary balance therefore favoured the respondent.
Whether the competency of the notice of appeal barred the application
The Court noted the service complaints but held that a challenge to the notice of appeal's validity should be raised by a striking-out application, which the respondent had not made.
The 1st respondent alleged the notice of appeal was served on a wrong email address and filed outside timelines under Rule 79(1). The Court acknowledged these concerns but held that the validity of a notice of appeal is properly contested through an application to strike out the appeal, which had not been brought; it therefore did not determine competency on this application.
Whether the ongoing court-annexed mediation affected the stay application
The pendency of court-annexed mediation weighed against a stay: a mediation settlement agreement is a product of the parties, so the applicant could not be prejudiced by it.
The trial court had referred the matter to mediation, yet the applicant pressed for arbitration. The Court observed that a settlement agreement reached in mediation is formulated by the parties themselves, making it inconceivable that the applicant could be prejudiced by a settlement it helped shape. The parallel consensual process therefore undermined rather than supported the nugatory-ness limb.
Legal principles established
#- A rule 5(2)(b) applicant must satisfy both twin principles of an arguable appeal and that the appeal would be rendered nugatory absent a stay; an arguable appeal need not necessarily succeed.
- Whether an appeal will be rendered nugatory depends on whether what is sought to be stayed is reversible, or whether damages will reasonably compensate the aggrieved party; where the trial outcome would be reversible and compensable by costs, no nugatory prejudice is shown.
- The proper forum to challenge the validity of a notice of appeal is an application to strike out the appeal, not opposition to an interlocutory stay application.
Court orders
#- 1.The application dated 4th July 2024 is dismissed
- 2.Costs of the application to the 1st respondent
- On appeal from
- Employment and Labour Relations Court
- Nairobi ELRC Cause No. E970 of 2023
- Jurisdiction invoked
- Rule 5(2)(b) of the Court of Appeal Rules (application for stay of proceedings pending appeal)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Hhi Management Services Limited v Steve Okeyo & 1 other", Case Analysis (2025). Not stated in the judgment (application dated 4th July 2024). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2025/501/eng@2025-03-21
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.