Total Kenya PLC v Ngure
The bottom line
#Kenya's Court of Appeal ruled that employment disputes can be sent to arbitration if the contract says so, even after the contract ends.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the learned Judge properly exercised her discretion in dismissing the application for stay of proceedings and reference to arbitration
- 2.Whether a dispute capable of being referred to arbitration had crystallised between the parties
- 3.Whether the arbitration clause in the Agreement remained operational after termination of the Agreement
- 4.Whether non-compliance with procedural preconditions in the arbitration clause rendered the clause inoperative
- 5.Whether a claim for a declaration of an employment relationship falls exclusively within the ELRC's jurisdiction and outside an arbitrator's remit
Key legal issues
#Whether a dispute referable to arbitration existed
There was a dispute concerning the terms and interpretation of the Agreement; the trial court erred in finding none.
The Court, as a first appeal, re-evaluated the record and found that the respondent's memorandum of claim was predicated on the Agreement, seeking its interpretation to give effect to asserted employee rights. The relationship was initiated by and governed by the Agreement, so the dispute over the parties' relationship following termination concerned the Agreement's terms and interpretation and was thus arbitrable.
Whether the arbitration clause survived termination of the Agreement
The clause remained operational; the dispute, being predicated on the Agreement, relates to rights accruing within its context as if it were still in existence.
The respondent argued the clause operated only during the contract's subsistence. The Court rejected this, noting the claim sought interpretation of the Agreement to ascertain rights that would accrue under it, meaning the contract would be interpreted as if in existence. It relied on Safaricom v Ocean View Beach Hotel for the Kompetenz/Kompetenz doctrine, under which the arbitrator may rule on the validity of the clause and the underlying contract.
Whether the ELRC's exclusive jurisdiction under section 12 of the ELRC Act ousts arbitration
Statutory jurisdiction in one forum does not invalidate a freely entered arbitration agreement; employment claims can be arbitrated if the agreement so provides.
The Court held the argument that a declaration of employment relationship is beyond an arbitrator's remit 'does not withstand scrutiny'. What matters is whether the parties agreed to submit the dispute to arbitration. The respondent did not show the arbitral process would be inherently prejudicial or incapable of granting appropriate relief, including a declaration on the nature of the relationship.
Effect of non-compliance with preconditions in the arbitration clause
Procedural defaults such as failure to give the 21 days' notice are matters for the arbitrator's initial determination, not grounds to defeat a stay.
The respondent argued the appellant had not complied with conditions precedent, including the 21 days' notice. The Court's preliminary view was that non-compliance with a procedural precondition does not automatically render the clause inoperative or the dispute non-arbitrable; such defaults are best left to the arbitrator's initial determination.
Legal principles established
#- A court faced with a stay application under section 6(1) of the Arbitration Act must inquire whether there is in fact a dispute and whether it falls within the arbitration agreement, and may evaluate the merits of the dispute.
- Non-compliance with a procedural precondition in an arbitration clause does not automatically render the clause inoperative or the dispute non-arbitrable; such defaults are for the arbitrator.
- The existence of statutory jurisdiction in the ELRC does not by itself invalidate a freely entered arbitration agreement; employment disputes can be arbitrated where the agreement so provides.
- An arbitration clause survives termination of the contract where the dispute is predicated on the contract's terms, and under Kompetenz/Kompetenz the arbitrator may rule on the validity of the clause and the underlying contract.
Court orders
#- 1.The ruling delivered on 19th November 2021 in Nairobi ELRC Cause No. E6462 of 2020 is set aside and substituted with an order allowing the appellant's Chamber Summons dated 29th January 2021
- 2.The proceedings in Nairobi ELRC Cause No. E6462 of 2020 are stayed pending reference of the dispute to arbitration in accordance with Clause VIII (iv) of the Young Dealer Marketing Licence Agreement dated 23rd February 2018
- 3.The parties shall, within sixty (60) days from the date of the judgment, take all necessary steps to commence and constitute the arbitral process
- 4.Each party to bear their own costs of the appeal
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- Employment and Labour Relations Court at Nairobi
- ELRC Cause No. E6462 of 2020
- Jurisdiction invoked
- First appeal to the Court of Appeal from the Employment and Labour Relations Court (the judgment does not cite the specific appellate provision)
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
In short, the appeal is for allowing and is hereby allowed. The ruling delivered on 19th November 2021 in Nairobi ELRC Cause No. E6462 of 2020 is hereby set aside and substituted with an order allowing the appellant’s Chamber Summons dated 29th January 2021.
The proceedings in Nairobi ELRC Cause No. E6462 of 2020 are stayed pending the reference of the dispute to arbitration in accordance with Clause VIII (iv) of the Young Dealer Marketing Licence Agreement dated 23rd February 2018.
The parties shall bear their own costs of the appeal.
A dispute cannot be said not to fall within the arbitration orbit merely because it touches on statutory rights; what matters is whether the parties agreed to submit their dispute to arbitration.
In dealing with a Section 6 application, the court is enjoined to form an opinion on the merits or otherwise of the dispute.
Issues in the judgment
#The same authority appears under two citations with different years (UAP Provincial Insurance v Beckett [2013] eKLR and [2013] KECA 205 (KLR)).
Nyutu Agrovet v Airtel cited twice with different citations ([2015] eKLR and [2024] KECA 523 (KLR)).
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Total Kenya PLC v Ngure", Case Analysis (2026). Civil Appeal E071 of 2022. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1763/eng@2026-09-25
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.