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ELRCPartially Allowed(not stated in judgment)· [2020] KEELRC 192 (KLR)

Christine Katunge Kitale v Statpack Industries Limited [2020] KEELRC 192 (KLR)

Employment and Labour Relations Court of Kenya
11 November 2020
1,956 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 set aside a default judgment so a case could be heard properly, but the employer had to pay Kshs.50,000 and act fast.

What this practically means

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Executive summary

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The Respondent in the main claim moved the court by Notice of Motion dated 29th July 2020, under Section 16 of the Employment & Labour Relations Court Act, Rules 33 and 38 of the ELRC (Procedure) Rules, 2016 and Order 10 rule 11 of the Civil Procedure Rules, seeking review, variation and/or setting aside of a judgment entered on 21st May 2020, a stay of execution, and leave to file a response to the Memorandum of Claim. The Respondent explained that it had instructed the firm of Jude & Sheila Associates, which it later discovered had been inactive for two years, so that neither appearance nor defence was filed; it asserted an arguable defence and absence of unreasonable delay. The Claimant, through counsel Davis Mulani, opposed the application as an abuse of process, asserting proper service of the Memorandum of Claim, the application for interlocutory judgment and the hearing notice, and contending the judgment followed formal proof on 6th February 2020. Both sides filed written submissions, citing authorities on default judgments and the judicious exercise of review discretion. The court found the respondent had been served and had failed to participate, and that no error on the record or discovery of new matter had been shown to warrant review, nor had the respondent been vigilant. Nevertheless, because the respondent wished to defend the claim, the court allowed the application, set the judgment aside, awarded the Claimant thrown away costs of Kshs.50,000/=, and directed that the case be set down for hearing within 90 days, failing which the judgment would be reinstated. Costs were made costs in the cause.

Key legal issues

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01

Whether the threshold for review/setting aside was met

Holding

The court found the review threshold unmet but nevertheless set aside the judgment to allow the matter be heard on its merits, conditioned on thrown away costs

Reasoning

The court observed that the respondent was duly served with the Memorandum of Claim, the application for interlocutory judgment and the hearing notice, and failed to participate. The respondent did not demonstrate any error on the record or discovery of new matter to warrant review, nor vigilance over its cause. However, since the respondent was desirous of defending the case, the court allowed the setting aside so justice could be served, with thrown away costs of Kshs.50,000/= and an obligation to fix the case for hearing within 90 days, failing which the judgment would be reinstated.

p. 3
02

Whether the judgment was a default judgment

Holding

The record shows the claim proceeded undefended after service, with judgment delivered on 21st May 2020

Reasoning

The claimant deponed that the matter proceeded to formal proof on 6th February 2020 after proper service, so the judgment was on merit and regular; the applicant characterised it as a default judgment. The court recorded that the claim proceeded undefended for hearing and judgment was delivered on 21/5/2020, with notice served on 17/6/2020. The court did not make an express finding resolving this characterisation, treating the application instead on review/set-aside principles.

p. 3

Legal principles established

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  • A party seeking to set aside a default judgment must demonstrate an arguable case, but a court may set aside where both parties can be heard on the merits, subject to thrown away costs and a condition of expeditious prosecution

Court orders

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  1. 1.Application dated 29th July 2020 allowed and the judgment of 21st May 2020 set aside (referred to in the order as 'the judgement of 17th May, 2020')
  2. 2.Respondents to pay the Claimant's thrown away costs of Kshs.50,000/=
  3. 3.Case to be set down for hearing within 90 days; in default the judgment in place to be reinstated
  4. 4.Costs in the cause

Authorities

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Legislation

  • Employment & Labour Relations Court ActSection 16
  • Employment & Labour Relations Court (Procedure) Rules, 2016Rules 33 and 38 (also cited as Rule 32(2) in submissions)
  • Civil Procedure Rules, 2010Order 10 rule 11; Order 12 rule 7

Cases cited (7)

  • Signature Tours & Travel Limited Vs National Bank of Kenya Limited
    (2018) eKLR
  • James Kanyiita Nderitu & Another
    (2016) eKLR
  • Lucy Bosire Vs Kehancha Div. Land Dispute Tribunal & 2 Others
    (2013) eKLR
  • Job Kiloch Vs Nation Group Ltd, Salaba Agencies Limited & Michael Riorio
    (2015) eKLR
  • Multichoice (Kenya) Limited Vs Wananchi Group Kenya Limited & 2 Others
    (2020) eKLR
  • Gerald Mwithia Vs Meru College of Technology (Sued Through The Chairman Board of Governors) & Another
    (2018) eKLR
  • Kenya Building, Construction Timber and Furniture Industries Employees' Union Vs Roads and Civil Engineering Contractors Association (RACECA)
    (2019) eKLR
Jurisdiction invoked
Section 16 of the Employment & Labour Relations Court Act; Rules 33 and 38 of the Employment & Labour Relations Court (Procedure) Rules, 2016; Order 10 rule 11 of the Civil Procedure Rules, 2010

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, "Christine Katunge Kitale v Statpack Industries Limited [2020] KEELRC 192 (KLR)", Case Analysis (2020). (not stated in judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/192/eng@2020-11-11

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