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ELRCDismissedNot stated in judgment· [2018] KEELRC 546 (KLR)

Justus Kibaara Kibai v Mt. Kenya East Farmers Co-op Limited [2018] KEELRC 546 (KLR)

Employment and Labour Relations Court
9 November 2018
NMNzioki wa Makau
1,281 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A former co-operative manager lost his claim for terminal dues and was ordered to repay Kshs. 1.5 million for cheque fraud, because he couldn't prove either claim with records.

What this practically means

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Executive summary

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The Claimant, secretary manager of the Respondent co-operative society for about a decade, took early retirement accepted on 28th August 2015. He sued for terminal dues of Kshs. 1,203,300/-, comprising salary arrears, staff provident fund, employment benefits, outstanding leave and NSSF arrears, together with a certificate of service and costs. The Respondent defended the suit and counterclaimed, alleging the Claimant fraudulently altered figures on cheques and embezzled Kshs. 1,500,000/-, for which he faced criminal charges at Nkubu Law Courts, breaching his fiduciary duty. The Claimant denied the allegations, asserting the audit report was tailored for the suit and that the cheques were authorized. Five witnesses testified for the Respondent, including the County Co-operative Officer Zachary Gitonga Njeru, whose audit established that cheque amounts were altered from sums approved on counterfoils, with the Claimant as payee. Committee members confirmed the sums they signed for were altered, though they lacked supporting vouchers. The court held that each party bore the burden of proving its case. The audit evidence, the Claimant's position as secretary manager, signatory and payee, established his involvement in the fraudulent alterations on a balance of probabilities. His claim failed as he neither proved the sums payable nor produced NSSF records. The suit was dismissed with no order as to costs, and judgment was entered for the Respondent on the counterclaim for Kshs. 1,500,000/-, with costs and interest from the date of judgment until payment in full.

Key legal issues

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01

Proof of the employee's entitlement to terminal dues

Holding

The Claimant's suit was dismissed because he failed to prove the quantum and basis of the dues claimed, including NSSF arrears.

Reasoning

Although the Claimant was granted early retirement and asserted entitlement to salary arrears, provident fund, leave and NSSF arrears, he did not demonstrate how the sums claimed were computed or payable. He did not produce NSSF records to substantiate the alleged arrears. The court held his claim unproved on a balance of probabilities and dismissed it with no order as to costs.

p. 2
02

Respondent's counterclaim for fraudulent alteration of cheques

Holding

On a balance of probabilities, the Claimant was found to have been involved in the fraudulent alterations and the Respondent was entitled to recover Kshs. 1,500,000/-.

Reasoning

The County Co-operative Officer's audit established that cheque figures were altered without basis, with the Claimant as payee. The Claimant was the secretary manager, a signatory, and the beneficiary of the varied amounts. Committee members testified that sums they approved were altered. The court found the Claimant involved in illegal activities notwithstanding the absence of vouchers, and entered judgment for the Respondent on the counterclaim.

p. 2

Legal principles established

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  • Each party in a suit and counterclaim bears the burden of proving its own case on a balance of probabilities.

Court orders

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  1. 1.Dismissal of the Claimant's suit with no order as to costs
  2. 2.Judgment entered for the Respondent against the Claimant on the counterclaim for Kshs. 1,500,000/-
  3. 3.Costs of the counterclaim to the Respondent
  4. 4.Interest on the sum awarded and on costs from the date of judgment until payment in full
Jurisdiction invoked
Employment and labour relations dispute (statement of claim and counterclaim), first instance

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, "Justus Kibaara Kibai v Mt. Kenya East Farmers Co-op Limited [2018] KEELRC 546 (KLR)", Case Analysis (2018). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/546/eng@2018-11-09

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