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ELRCDismissedNairobi Employment and Labour Relations Court Cause No. 561 of 2014 (as consolidated with Cause No. 1988 of 2014)

Ochieng Owiti & others v Anthony Oluoch t/a A. T Oluoch and Company Advocates & 2 others [2020] KEELRC 352 (KLR)

Employment and Labour Relations Court
16 October 2020
MOMaureen Onyango
6,675 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~27 min to read original · ~4 min brief

The bottom line

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Former Telkom Kenya employees failed to overturn their Kshs.500 Million settlement because consent orders are binding contracts unless you prove fraud.

What this practically means

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Executive summary

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The Applicants, former Telkom Kenya employees retrenched in 2006 and claimants in ELRC Cause 561 of 2014 (consolidated with Cause 1988 of 2014), moved the court by Notice of Motion dated 22nd May 2019 seeking review of a consent order recorded on 15th/16th December 2015 under which Telkom Kenya paid them Kshs.500 Million plus Kshs.20 Million costs. They complained the settlement was based on one month's salary per year worked rather than the two-and-a-half months' salary plus golden handshake obtained by claimants in the Ochanda suits (Kshs.1.3 Billion), and alleged the consent was entered without their instructions and fraudulently. They joined their former advocates as 1st and 2nd Respondents. The 3rd Respondent raised a preliminary objection on representation and joinder; all Respondents argued the court was functus officio, the consent had contractual effect, and the applicants had accepted payment and signed discharge vouchers. Maureen Onyango J framed four issues. She held the former advocates were improperly joined because joinder is only possible during the pendency of proceedings and the suit had been determined by the consent order. She found the firm of Mbuthia Kinyanjui not properly on record, as a notice of change of advocates does not satisfy Order 9 Rule 9. She held the court had jurisdiction under Rule 34 of the ELRC Procedure Rules notwithstanding the functus officio doctrine. On the merits, applying the established principle that consent orders have contractual effect and can only be set aside on contract-vitiating grounds, she found no proof of fraud, noted the claimants' representatives had expressly instructed the advocates to accept the settlement, that the applicants had received and retained payment, and that four years had elapsed. The application was dismissed with no orders as to costs.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether the 1st and 2nd Respondents are rightfully joined in the suit
  2. 2.Whether the firm of Mbuthia Kinyanjui is properly on record
  3. 3.Whether the Court has jurisdiction to determine the application
  4. 4.Dependent on the finding in (c) above, whether the Court should grant the orders sought

Key legal issues

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01

Joinder of the 1st and 2nd Respondents (former advocates for the claimants)

Holding

Joinder was improper as they were never parties to the suit and were joined only after the consent was adopted, in an application to review it

Reasoning

Order 1 Rule 10(2) contemplates joinder during the pendency of proceedings. The suit had been determined by the consent order of 15 December 2015. Joining non-parties after adoption of the consent in a review application would be impractical, and the joinder could occasion unnecessary problems, consistent with Lucy Nungari Ngigi v National Bank of Kenya.

p. 7
02

Whether the firm of Mbuthia Kinyanjui and Company Advocates is properly on record

Holding

Not properly on record; a notice of change of advocates does not comply with Order 9 Rule 9 which requires an application with notice or a consent after judgment

Reasoning

There was no ruling granting the firm leave to come on record; the proceedings of 7 August 2017 referenced by the applicants concerned a deferred ruling, not representation. After judgment, change of advocates requires an application with notice to all parties or a consent between outgoing and incoming advocates, neither of which was in the record.

p. 7
03

Jurisdiction of the court to determine the review application

Holding

The court has jurisdiction notwithstanding functus officio arguments, as the application is brought under Rule 34 of the ELRC Procedure Rules

Reasoning

The respondents argued the court became functus officio upon recording the consent. The court, citing the Supreme Court's articulation of the doctrine in Raila Odinga v IEBC, held that its review jurisdiction under the ELRC Procedure Rules allowed it to determine the application.

p. 7
04

Whether the consent order of 15th December 2015 should be reviewed or set aside

Holding

No; the applicants did not prove fraud and did not meet the threshold for review, and were simply disgruntled at receiving less than the Ochanda claimants

Reasoning

Consent orders have contractual effect and can only be set aside on contract-vitiating grounds. The applicants' own representatives gave written instructions to accept the Kshs.500 Million settlement; the applicants received payment and signed discharge vouchers, and waited four years to challenge the consent. The representatives who instructed counsel were not joined.

p. 8

Legal principles established

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  • A consent judgment or order has contractual effect and can only be set aside on grounds which would justify setting a contract aside, or where obtained by fraud, collusion or an agreement contrary to the policy of the court
  • Joinder of parties is only possible during the pendency of proceedings; joinder after a suit has been concluded by consent order is improper
  • A change of advocates after judgment requires an application with notice or a consent under Order 9 Rule 9; a notice of change of advocates is insufficient
  • The functus officio doctrine does not bar the court from exercising its review jurisdiction under the ELRC Procedure Rules

Court orders

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  1. 1.The application dated 22nd May 2019 is dismissed with no orders as to costs

The bench

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One judgment of the whole court — no separate or dissenting opinions.

MO
majority

Wrote the judgment

Jurisdiction invoked
Employment and Labour Relations Court (Procedure) Rules, 2016 (application under Rule 34; review thresholds under Rule 33)
Consolidated with
Cause No. 1988 of 2014

Relief refused

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Review of the consent order made in ELRC Cause 561 of 2014 (as consolidated with Cause 1988 of 2014)

The applicants failed to prove fraud and did not meet the threshold for review or setting aside of a consent order; the consent had contractual effect

p. 8

Directions that the consents be reviewed to match the Ochanda suit terms, or that parties negotiate afresh (Prayer 4)

Dependent on the success of prayer 3

p. 8

Declaration that the consent of 16th December 2015 was entered without proper instructions and authority (Prayer 5)

Dependent on prayer 3; no evidence of lack of instructions, representatives had authorised the settlement

p. 8

Costs

the application is dismissed with no orders as to costs

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

It is therefore my finding that the 1st and 2nd Respondents are not properly joined in the suit.
p. 7joinder of non-parties after judgment
I therefore find that the Applicant's advocates are not properly on record.
p. 7change of advocates after judgment
this application being one that is brought under Rule 34 of the Employment and Labour Relations Court (Procedure) Rules, this Court has jurisdiction to determine the matter.
p. 7jurisdiction and functus officio
It is now settled law that a consent judgment or order has contractual effect and can only be set aside on grounds which would justify setting a contract aside
p. 8binding effect of consent judgments
Having found all the prayers in the application not merited, the application is dismissed with no orders as to costs.
p. 8final orders/disposition

Issues in the judgment

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minor

The judgment inconsistently records the Ochanda suits' case numbers (HCCC 216/07, 219/07, 255/07 versus 'HCCC 219 of 2017' and 'HCCC 216 of 2017')

minor

The date of the Notice of Change of Advocates is inconsistently stated as 2nd October 2013 in submissions versus 2nd October 2017 in the court record

minor

The 3rd Respondent's Replying Affidavit refers to 'Cause 516 of 2014 which is the instant suit' whereas the instant suit is Cause 561 of 2014

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (3)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Ochieng Owiti & others v Anthony Oluoch t/a A. T Oluoch and Company Advocates & 2 others [2020] KEELRC 352 (KLR)", Case Analysis (2020). Nairobi Employment and Labour Relations Court Cause No. 561 of 2014 (as consolidated with Cause No. 1988 of 2014). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/352/eng@2020-10-16

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