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ELRCPartially AllowedCause 2289 of 2015 (application dated 19th October 2017)· [2018] KEELRC 1260 (KLR)

Rift Valley Railways Workers Union v Kenya Railways Staff Retirement Benefits Scheme,Kenya Railways Corporation,Corporate Trustees,Retirement Benefits Authority,Ethics & Anti-Corruption Commission,Retirement Benefits Authority & Alexander Forbes (Cause 2289 of 2015) (Employment and Labour) [2018] KEELRC 1260 (KLR)

Employment and Labour Relations Court
17 August 2018
3,278 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~13 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court confirmed it can hear pension disputes when the Retirement Benefits Tribunal is not functioning, and temporarily blocked the sale of pension scheme properties.

What this practically means

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Executive summary

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The claimant union filed a claim in December 2015 seeking appointment of a caretaker committee to manage pensioners' assets and a forensic audit of the Kenya Railways Staff Retirement Benefits Scheme. Preliminary objections by the respondents led to a ruling by Ndolo J. on 19th August 2016 declining jurisdiction and referring the dispute to the dispute resolution mechanisms under the Retirement Benefits Act. The claimant duly referred the matter to the Retirement Benefits Appeals Tribunal, but by letter dated 5th July 2017 the Tribunal's Clerk informed it that the Tribunal was not properly constituted, as the terms of most members had ended on 14th February 2017 and new appointments had not been made. The claimant returned to court by application dated 19th October 2017, asking the court to assume jurisdiction in the absence of a functional Tribunal, and seeking a restraining order over scheme properties listed in Legal Notice No. 169 of 2006. The 1st, 3rd and 4th respondents and the 4th Interested Party raised preliminary objections contending that the court was functus officio, that the suit was res judicata, that the application was fatally defective and not predicated on any suit, that the claimant lacked locus standi, and that the application was an abuse of court process. The court, Maureen Onyango J., dismissed all the objections. It held that the earlier ruling made no determination on the merits and so the court was not functus officio; that the suit was not res judicata; that the union, as a signatory to the Trust Deed, had locus standi; and that where the statutory tribunal is non-functional, this court with unlimited original jurisdiction over pension matters as employment matters must assume jurisdiction. The court granted a temporary injunction restraining the 1st respondent from disposing of the listed properties pending hearing of the application.

Key legal issues

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01

Functus officio

Holding

The court is not functus officio because the ruling of 19th August 2016 only referred the matter to the Retirement Benefits Act mechanism and made no determination on the issues.

Reasoning

The court examined Ndolo J's ruling of 19th August 2016 and found that it made no finding on the preliminary objections or the issues in the suit; its only determination was to refer the matter for resolution under the Retirement Benefits Act. Since no issue had been determined, the court retained authority over the matter.

p. 5
02

Jurisdiction where the statutory tribunal is non-functional

Holding

This court has jurisdiction over pension matters and must assume it where the Retirement Benefits Tribunal, which should exercise that jurisdiction, is not operational.

Reasoning

Pension matters are employment matters within the court's unlimited original jurisdiction under Section 12 of the Employment and Labour Relations Act. The Tribunal was not constituted because members' terms had ended and no appointments had been made. The law did not anticipate such a lacuna, and a litigant cannot be left without a remedy because authorities failed to appoint tribunal members.

p. 5
03

Locus standi

Holding

The claimant union has locus standi as a signatory to the Trust Deed representing its members who are members of the Scheme.

Reasoning

The claimant is a signatory to the Trust Deed of the 1st respondent, and its members are members of the Scheme. That status confers standing to sue on behalf of its members. Since no final determination had been made in the suit, the suit was also not res judicata.

p. 5
04

Abuse of court process and res judicata

Holding

The claimant has not abused the court process and the suit is not res judicata because no determination has been made on the issues.

Reasoning

Because the matter had been referred to a dysfunctional tribunal and no determination had been made on the issues in the suit, the claimant's return to court to assume jurisdiction in the absence of the Tribunal was not an abuse of process, nor could the suit be res judicata absent a final determination.

p. 6

Legal principles established

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  • Where a tribunal vested with jurisdiction over a dispute is not functional, a court with unlimited original jurisdiction may assume jurisdiction over the dispute; a litigant will not be left without a remedy.
  • A court that merely refers a dispute to a statutory dispute resolution mechanism has not made a final determination and is not functus officio.

Court orders

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  1. 1.Preliminary objections filed by the 1st and 3rd respondents and 4th Interested Party dismissed
  2. 2.A temporary injunction restraining the 1st respondent or its agents from disposing of any of the properties listed in Legal Notice No. 169 of 2006 pending the hearing and determination of the application dated 19th October 2017

Authorities

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Legislation

  • Retirement Benefits ActSections 46(1), 47
  • Employment and Labour Relations ActSection 12
  • Constitution of KenyaArticles 162(2), 162(2)(b), 165(5)
  • Labour Relations Act
  • Societies Act Cap 108
  • Legal Notice No. 169 of 2006

Cases cited (7)

  • OWNERS OF MV LILLIAN S -V- CALTEX OIL KENYA LIMITED
    (1989) KLR
  • SAMUEL KAMAU MACHARIA & ANOTHER -V- KENYA COMMERCIAL BANK & 2 OTHERS
    [2013] eKLR
  • TOM KUSIENYA & OTHERS -V- KENYA RAILWAYS RETIREMENT BENEFITS SCHEME
    Petition No. 353 of 2012
  • DANIEL OWOUR OBOP & 2 OTHERS -V- RETIREMENT BENEFITS AUTHORITY
    Petition No. 159 of 2012
  • KENYA PORTS AUTHORITY -V- INDUSTRIAL COURT OF KENYA & ANOTHER
  • JOHN FLORENCE MARITIME SERVICE LIMITED & ANOTHER -V- CABINET SECRETARY FOR TRANSPORT AND INFRASTRUCTURE & 3 OTHERS
  • GRAHAM RIOBA SAGWE & 2 OTHERS -V- FINA BANK LIMITED & 5 OTHERS
Jurisdiction invoked
Article 162(2) of the Constitution and Section 12 of the Employment and Labour Relations 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, "Rift Valley Railways Workers Union v Kenya Railways Staff Retirement Benefits Scheme,Kenya Railways Corporation,Corporate Trustees,Retirement Benefits Authority,Ethics & Anti-Corruption Commission,Retirement Benefits Authority & Alexander Forbes (Cause 2289 of 2015)  (Employment and Labour) [2018] KEELRC 1260 (KLR)", Case Analysis (2018). Cause 2289 of 2015 (application dated 19th October 2017). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/1260/eng@2018-08-17

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