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ELRCAllowedNotice of Motion dated 24/04/2019· [2019] KEELRC 465 (KLR)

Arthur Kawino v Population Services Internaitonal (PSI) [2019] KEELRC 465 (KLR)

Employment & Labour Relations Court
7 October 2019
2,539 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~10 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court reinstated an employee's claim, ruling that a foreign arbitration clause cannot force him to litigate in the USA he cannot afford.

What this practically means

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Executive summary

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The Claimant, Arthur Kawino, brought a Notice of Motion dated 24/04/2019 under Rule 33 of the ELRC (Procedure) Rules 2016 seeking review of the Court's orders of 17/11/2017 striking out his employment claim against Population Services Limited on the basis that his contract contained an arbitration clause designating a single arbitrator in Washington, DC. He argued that he could not afford the estimated USD 50,000 to litigate in the United States, did not qualify for a US visa, that both parties and all evidence were in Kenya, and that there were errors apparent on the face of the record. The Respondent opposed through grounds of opposition, contending the Court was functus officio, the application was an appeal in disguise and an attempt to rewrite contractual terms, and that it was filed after inordinate delay of over 16 months. The Respondent filed no submissions. Reviewing the authorities, Wasilwa J applied Rule 33 and the principle from Kanti v South British Insurance that a party entering unconditional appearance submits to the court's jurisdiction and cannot resile from it. The Respondent had entered unconditional appearance on 9/1/2017, some two and a half months before filing its preliminary objection. The Court also had regard to the Eleftheria factors and the fact that the Respondent had a Nairobi office and would suffer no prejudice if the dispute were heard in Kenya. The Court found an error on the record in having directed the Claimant to resolve the dispute in the USA despite the Respondent's submission to jurisdiction. The application was allowed; the ruling of 17/11/2017 was reviewed, the claim reinstated for hearing and disposal, with costs in the cause.

Key legal issues

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01

Whether the ruling of 17/11/2017 striking out the claim contained an error apparent on the face of the record warranting review

Holding

Yes - the Court found it was an error to direct the Claimant to resolve the dispute in the USA when the Respondent had already submitted to the Court's jurisdiction by unconditional appearance

Reasoning

The Court applied Rule 33 which permits review for error apparent on the face of the record, discovery of new matter, or other sufficient reason. It held that since the Respondent entered unconditional appearance on 9/1/2017 before filing its preliminary objection, it had submitted to jurisdiction and could not resile from that position. Directing arbitration in Washington DC despite that submission was an error on the record, and the Respondent's Nairobi office meant it would suffer no prejudice from trial in Kenya.

p. 4
02

Whether an exclusive foreign arbitration/jurisdiction clause ousts the ELRC's jurisdiction over an employment dispute

Holding

No - such a clause does not by itself divest the Court of jurisdiction, particularly where its effect would be to frustrate the employee's access to justice

Reasoning

Relying on Stephen Nyamweya v Riley Services and Universal Pharmacy v Pacific International Lines, the Court endorsed the position that Kenyan courts may assume jurisdiction despite exclusive foreign forum clauses, applying the Eleftheria factors of convenience, location of evidence and prejudice. The Claimant's inability to afford USD 50,000 and his visa ineligibility meant enforcing the clause would deny him access to justice under Article 50.

p. 2

Legal principles established

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  • A defendant who enters unconditional appearance submits to the court's jurisdiction and cannot thereafter contest it by a preliminary objection, including where an exclusive foreign jurisdiction or arbitration clause exists.
  • Kenyan courts retain discretion to assume jurisdiction notwithstanding an exclusive foreign jurisdiction clause, weighing the convenience of the parties, location of evidence and prejudice.

Court orders

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  1. 1.The Court's ruling of 17/11/2017 striking out the claim is reviewed and set aside
  2. 2.The claim is reinstated for hearing and disposal before the Court
  3. 3.Costs in the cause

Authorities

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Legislation

  • Employment & Labour Relations Court (Procedure) Rules 2016Rule 33(1)(a)-(d)
  • Employment & Labour Relations Court ActSections 3, 12(3)(vii), 16, 29
  • Constitution of Kenya, 2010Articles 41(1), 47, 48, 50(1), 159, 162(2)(a) and (3)
  • Civil Procedure RulesOrder 45(1)

Cases cited (7)

  • JMK v MWM & another
    [2015] eKLR
  • Stephen Nyamweya & another v Riley Services Limited
    [2013] eKLR
  • Universal Pharmacy (K) Limited v Pacific Lines Limited & another
    [2015] eKLR
  • United India Insurance Co. Ltd
  • Dorcas Kemunto Wainaina v IPAS
    (2018) eKLR
  • Shadrack Wachira Gikonyo vs ABT Associates INC
    eKLR (2017)
  • Kanti and Company Limited vs South British Insurance Company Limited
    (1981) eKLR
Jurisdiction invoked
Rule 33 of the Employment & Labour Relations Court (Procedure) Rules 2016; Sections 3, 12(3)(vii), 16 and 29 of the Employment & Labour Relations Court Act; Articles 41(1), 48, 50(1), 159 and 162(2)(a) and (3) of the Constitution

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, "Arthur Kawino v Population Services Internaitonal (PSI) [2019] KEELRC 465 (KLR)", Case Analysis (2019). Notice of Motion dated 24/04/2019. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/465/eng@2019-10-07

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