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ELRCOtherNot stated in the judgment· [2018] KEELRC 2483 (KLR)

Hassan Mohammed Ali v Provide International Hospital [2018] KEELRC 2483 (KLR)

Employment and Labour Relations Court
9 February 2018
442 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan employment court stopped a lawsuit because the contract required arbitration first, confirming parties must use agreed dispute resolution steps before going to court.

What this practically means

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Executive summary

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Dr. Hassan Mohammed Ali (Claimant) sued Provide International Hospital (Respondent) in the Employment and Labour Relations Court on 13 November 2017, alleging exploitation through refusal to honour the terms of a consultancy contract by failing to pay for services rendered. Upon service, the Respondent filed a motion seeking a declaration that the Court lacked jurisdiction to determine the dispute, or in the alternative, a stay of proceedings pending reference of the dispute to arbitration. In opposition, the Claimant filed a replying affidavit and submissions were heard on 23 January 2018. The Court identified two broad objections: the existence of an arbitration clause in the contract, and the absence of an employer/employee relationship. On the first, the Court found that clause 9 of the written contract required unresolved disputes to be referred to arbitration, a route the Claimant had not utilised. It held it imperative that parties exhaust the dispute resolution avenue they mutually and willingly agreed to, and accordingly allowed the alternative prayer staying the proceedings pending arbitration. On the second ground, the Court took a cautious approach, declining to determine whether an employer/employee relationship existed because that would require delving deeply into disputed facts; as a passing observation it noted the contract at clause 4 described the Claimant as an independent service provider and referenced the Ready Mixed Concrete case on the definition of an employee. Costs were ordered to abide the arbitration. Judgment was delivered in Nairobi on 9 February 2018 by Radido Stephen J.

Key legal issues

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01

Enforcement of an arbitration clause in a consultancy contract in an employment cause

Holding

The Court stayed the proceedings because the parties had contractually agreed to refer disputes to arbitration and the Claimant had not utilised that route.

Reasoning

Clause 9 of the written contract required disputes not mutually settled to be referred to arbitration. The Court held that a party who has willingly agreed to a dispute resolution avenue must exhaust it before litigating. The Claimant had bypassed the agreed route, and the Court therefore granted the alternative prayer staying the proceedings.

p. 1
02

Whether an employer/employee relationship existed between the parties

Holding

The Court declined to determine this issue, noting it would require examination of disputed facts, while observing the contract described the Claimant as an independent service provider.

Reasoning

Because the dispute was being stayed for arbitration, the Court found it unnecessary to decide the status question, which would require a deep inquiry into disputed facts. As a passing observation it noted the authority on the definition of an employee and that clause 4 of the contract designated the Claimant an independent service provider.

p. 2

Legal principles established

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  • Parties must exhaust the dispute resolution mechanism they mutually and willingly agreed to in their contract before approaching the Court.

Court orders

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  1. 1.Stay of the proceedings pending reference of the dispute between the parties to arbitration, as proposed in order 2 of the Respondent's motion
  2. 2.Costs to abide the arbitration

Authorities

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Cases cited (1)

  • Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance
    (1968) 2QB 497
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction challenged by the Respondent's preliminary motion

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, "Hassan Mohammed Ali v Provide International Hospital [2018] KEELRC 2483 (KLR)", Case Analysis (2018). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/2483/eng@2018-02-09

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