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ELRCDismissedNotice of Motion dated 11/12/2014, filed 15/12/2014· [2015] KEELRC 637 (KLR)

Amalgamated Union Of Kenya Metal Workers v Mashariki Motors Limited & 2 others [2015] KEELRC 637 (KLR)

Industrial Court of Kenya
27 July 2015
767 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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The Industrial Court refused to strike out a redundancy claim, holding that termination letters showing a joint venture connection justified keeping all parties in the case.

What this practically means

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Executive summary

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The Applicant, the 1st Respondent in the main claim, moved the Industrial Court by Notice of Motion dated 11/12/2014 seeking to strike out the Memorandum of Claim dated 6/10/2014 as against the 3rd Respondent, with costs. It advanced three grounds: that the Grievants were never employees of the 3rd Respondent; that no valid joint venture agreement existed between the 2nd and 3rd Respondents leading to the Grievants' redundancy; and that the 3rd Respondent ceased to exist as a legal entity on 15th July 2010, rendering the claim defective, frivolous, vexatious and an abuse of process. The Claimant Respondents opposed the application, arguing that the applicant's own assertion of the 3rd Respondent's non-existence undermined the application itself, and relying on termination letters referencing a joint venture between Simba Colt Motors Limited and Karuna Holdings Limited, under which Mashariki Motors Limited would cease trading, as well as on admitted negotiations and payment transactions between the parties. Justice Hellen Wasilwa examined the termination letters and found they demonstrated that the redundancy of the Grievants was connected to the alleged joint venture involving the 3rd Respondent, justifying its enjoinder. She further reasoned that the 3rd Respondent stood to lose nothing if not found culpable, as it would be compensated in costs. The application was found to have no merit and was dismissed with costs to the Claimant Respondents, with the main suit to be set down for hearing. Judgment was delivered in open court on 27th July 2015.

Key legal issues

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01

Whether the claim against the 3rd Respondent should be struck out

Holding

The application was dismissed; the documents evidenced a connection between the 3rd Respondent and the redundancy of the Grievants

Reasoning

The termination letters issued to the Grievants referenced a joint venture involving Simba Colt Motors Limited and Karuna Holdings Limited, and stated Mashariki Motors Limited would cease trading. This connected the 3rd Respondent to the redundancy. The applicant's own submissions admitted negotiations among the parties. Since a party not found culpable can be compensated in costs, no prejudice would flow from remaining a party, and striking out was unwarranted.

p. 2
02

Whether the 3rd Respondent ceased to exist as a legal entity and the effect of that on the application

Holding

The court found it inconsistent for an allegedly non-existent entity to bring an application, but this did not avail the applicant given the demonstrated connection to the suit

Reasoning

The applicant argued the 3rd Respondent ceased to exist as a legal entity on 15th July 2010. The Claimant Respondents countered that this very assertion undermined the application, since it would have been filed by a non-existent entity. The court observed the connection between the respondents and the 3rd Respondent justified its enjoinder, and the alleged non-existence did not compel striking out the claim.

p. 2

Legal principles established

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  • A non-existent entity cannot file an application before the court, but where a connection between a party and the suit is shown, the party is properly enjoined
  • A party improperly joined stands to lose nothing if not found culpable, as it will be compensated in costs

Court orders

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  1. 1.The application dated 11/12/2014 is dismissed with costs to the Claimant Respondents
  2. 2.The suit may now be set down for hearing

Authorities

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Legislation

  • Industrial Court ActSection 12(3)(viii)
  • Industrial Court RulesRule 14(5)
Jurisdiction invoked
Section 12(3)(viii) of the Industrial Court Act, Rule 14(5) of the Industrial Court Rules

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, "Amalgamated Union Of Kenya Metal Workers v Mashariki Motors Limited & 2 others [2015] KEELRC 637 (KLR)", Case Analysis (2015). Notice of Motion dated 11/12/2014, filed 15/12/2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/637/eng@2015-07-27

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