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ELRCDismissedCause (Employment and Labour Relations Court) – applications dated 9th June 2015 and 8th July 2015 arising from judgment delivered 28th May 2015· [2015] KEELRC 1644 (KLR)

Pithon Mwangi Njoroge v Pithon Mwangi Njoroge [2015] KEELRC 1644 (KLR)

Employment and Labour Relations Court
23 September 2015
3,762 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~15 min to read original · ~4 min brief

The bottom line

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A Kenyan employment court confirmed it can handle staff loan disputes, but refused to rescue a worker who raised property claims only after judgment was delivered.

What this practically means

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Executive summary

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This ruling of the Employment and Labour Relations Court at Nairobi, delivered by M. Mbaru, Judge, on 23rd September 2015, determined two applications arising from a judgment of 28th May 2015 in which the Court had found the claimant's summary dismissal unfair under sections 41, 43 and 45 of the Employment Act. The respondent bank applied on 9th June 2015 for stay of execution of the decretal sum of Kshs.2,019,671.40 pending a intended appeal, offering to deposit the amount in a joint advocates' account. The claimant applied on 8th July 2015 for an injunction restraining the bank from auctioning LR. No. Ngong Township Block 1/359, charged to secure a staff housing loan, and for orders that the loan continue to accrue interest at staff rates and be serviced in instalments. The bank opposed, contending the Court lacked jurisdiction over a purely commercial charger/chargee relationship and had become functus officio. The Court framed three issues: jurisdiction, stay, and restraining orders. It held that jurisdiction under Articles 41 and 162(2) and section 12(3) of the Employment and Labour Relations Court Act covers staff loan disputes since the loan terms flowed from employment. Stay was refused because a Notice of Appeal and draft memorandum do not amount to a pending appeal, and the claimant was entitled to enjoy his judgment. The injunction application failed as an attempt to litigate afresh, post-judgment, matters never pleaded; it was overtaken by events. Both applications were dismissed with each party bearing their own costs.

Key legal issues

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01

Jurisdiction to restrain exercise of the statutory power of sale over property charged under a staff loan

Holding

The Court has jurisdiction because the staff loan, mortgage rates and repayment terms are inseparable from the employment relationship, but the claimant's application was a fresh claim lodged after judgment and had to fail

Reasoning

The Court traced its jurisdiction to Articles 41, 162(2) and (3) and section 12(3) of the Employment and Labour Relations Court Act, which permits interim preservation orders and injunctions. The staff loan terms flowed from employment, so jurisdiction was not ousted by the charger/chargee relationship. However, the property matters were never part of the issues pleaded or heard before the 28th May 2015 judgment, and to grant fresh orders would contravene due process and fairness to the respondent.

p. 5
02

Whether stay of execution pending intended appeal should be granted

Holding

Stay refused; the respondent had only filed a Notice of Appeal and draft memorandum, and the claimant was entitled to enjoy his judgment

Reasoning

Applying the conditions in Collins Osoro Lukhale v AAA Growers Ltd and Mukuma v Abuoga, stay requires substantial loss, no unreasonable delay and security. The respondent offered to deposit the decretal sum in a joint account, but an intended appeal, notice and draft memorandum do not amount to a pending appeal before the Court of Appeal. The claimant, unfairly dismissed, holds a valid judgment and should enjoy it notwithstanding his unemployment.

p. 5
03

Effect of unfair termination on staff loan rates

Holding

Applying commercial rates after a finding of unfair termination would be double punishment and an unfair labour practice contrary to the right to dignity

Reasoning

The Court observed that had the claimant not been unfairly terminated he would have continued repaying his staff loan at negotiated staff rates. Applying commercial rates post-termination would reduce an employee to a homeless person, contrary to Article 28 on dignity, and constitutes an unfair labour practice. Nonetheless this principle could not rescue the claimant's post-judgment application, which sought to litigate matters never pleaded.

p. 6

Legal principles established

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  • The Employment and Labour Relations Court has jurisdiction to grant interim preservation orders, including injunctions, in matters stemming from employment and labour relations under section 12(3) of its Act
  • A dispute over a charge securing a staff loan flows from the employment relationship and is a matter for the employment court, not a purely commercial matter
  • Stay of execution requires substantial loss, absence of unreasonable delay and security; a Notice of Appeal and draft memorandum do not establish a pending appeal
  • A party cannot litigate fresh claims through an application after judgment has been delivered; such matters must be raised at the pleading or hearing stage

Court orders

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  1. 1.The application dated 9th June 2015 by the Respondent seeking stay of execution is dismissed
  2. 2.The application dated 8th July 2015 by the Claimant is dismissed as overtaken by events
  3. 3.Each party shall bear their own costs

Authorities

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Legislation

  • Constitution of KenyaArticle 41
  • Constitution of KenyaArticle 162(2) and (3)
  • Constitution of KenyaArticle 12(1)(a) – as cited by claimant, seemingly Article 162(2) (judgment text cites section 12(1)(a) of the Industrial Court Act)
  • Constitution of KenyaArticle 40(1)(a) and (b)
  • Constitution of KenyaArticle 28
  • Employment and Labour Relations Court Act (Industrial Court Act)Section 12(1)(a) and 12(3)
  • Employment ActSections 41, 43 and 45

Cases cited (5)

  • Giella Vs Cassman Brown & Company Limited
    [1973] EA 358
  • Collins Osoro Lukhale versus AAA Growers Ltd
    Cause No. 100 of 2012
  • Mukuma V Abuoga
    (1988) KLR 645
  • Banking Insurance & Finance Union (Kenya) Vs Consolidated Bank of Kenya Limited
    Cause No 900 of 2012
  • Abraham Nyambane Asiago versus Barclays Bank of Kenya Limited
    Cause No.149 of 2013
Jurisdiction invoked
Articles 41, 162(2) and (3) of the Constitution and section 12 of the Employment and Labour Relations Court Act

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, "Pithon Mwangi Njoroge v Pithon Mwangi Njoroge [2015] KEELRC 1644 (KLR)", Case Analysis (2015). Cause (Employment and Labour Relations Court) – applications dated 9th June 2015 and 8th July 2015 arising from judgment delivered 28th May 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/1644/eng@2015-09-23

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