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ELRCDismissedNot stated in the judgment· [2020] KEELRC 933 (KLR)

Esther Mutembei v Oracle Systems Limited [2020] KEELRC 933 (KLR)

Employment and Labour Relations Court
28 May 2020
HWHellen Wasilwa
2,590 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 refused to review its earlier ruling, holding that an unsigned, unadopted settlement cannot be enforced where parties kept negotiating.

What this practically means

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Executive summary

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The Applicant (employer) filed a Notice of Motion on 2/12/2019 seeking review of the Court's ruling delivered on 11/7/2019, contending there was an error apparent on the face of the record: the ruling had dismissed its Preliminary Objection and directed the main suit to proceed on the mistaken view that no settlement was reached, whereas the parties had entered a Settlement Agreement dated 12/9/2017 under which the Claimant was paid Kshs. 3.5 million out of an agreed Kshs. 5 million, with the only outstanding issue being the deduction of taxes. The Respondent (Claimant) opposed, arguing the application was an abuse of process, raised new issues, and was intended to delay the hearing; she maintained the settlement sum was all-inclusive and not subject to deductions. In submissions, the Applicant relied on statutory provisions and authorities holding that employer payments are subject to statutory deductions; the Respondent relied on the construction of unambiguous agreements. The Court traced the record and found the consent filed 13/9/2017 was never adopted, and the parties' subsequent appearances showed they were still resolving the tax issue, with counsel stating on 1/2/2018 that no settlement had been reached. Applying the law on consent orders, the Court held it could not vary a consent, and that the parties had reneged before the agreement could be recorded as an order. Finding no error apparent on the record, the Court declined to review its ruling, dismissed the application, and ordered costs in the cause.

Key legal issues

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01

Whether an error apparent on the face of the record exists warranting review of the ruling of 11/7/2019

Holding

No error apparent on the face of the record was established; the ruling correctly reflected that the parties had not fully resolved the dispute when they appeared after filing the consent.

Reasoning

The Court traced the record: the consent filed on 13/9/2017 was never adopted by 27/9/2017 when the Claimant asked for mention to confirm compliance; on 8/11/2017 the Applicant's counsel sought mention to settle an issue on taxes; and on 1/2/2018 counsel said they had not reached a settlement. The Court therefore held the parties had not fully resolved the issues, so the ruling could not be said to rest on an apparent error, and review was unwarranted.

p. 4
02

Whether a court can vary or reinforce a consent where parties have reneged on it

Holding

A court cannot vary a consent order, and here the Court was not even asked to vary one because the parties had reneged on the agreement before it was recorded as an order of the Court.

Reasoning

Applying the established law on consent judgments (as restated in NSSF v Michael Mwalo, citing Harun J in KBC v Specialised Engineering), the Court held consents bind parties and can only be set aside on limited grounds. Since the parties, by their actions and utterances after filing the consent, were still negotiating the tax issue, the Court could not be compelled to record the agreement as an order; hence no review lay.

p. 4

Legal principles established

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  • A consent order entered into by counsel is binding and cannot be set aside or varied except on limited grounds such as fraud, collusion, or misapprehension of material facts
  • A court cannot reinforce or record a consent as an order of the Court where the parties themselves, by their actions and utterances, had reneged on or not completed the settlement

Court orders

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  1. 1.The application for review of the ruling delivered on 11/7/2019 is dismissed - the Court found no error apparent on the face of the record
  2. 2.Costs in the cause

Authorities

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Legislation

  • Income Tax Actsection 15(7)(e)
  • Income Tax Actsection 39(1)
  • Employment Actsection 19(1)
  • Employment Actsection 49(2)

Cases cited (7)

  • Carolly Onyango & 29 others v Jiangxi Zhongmei Engineering Construction Limited
    [2018] eKLR
  • Jimmi Nhlapo Maseg v Aviation Workers Union
    [2014] eKLR
  • Kioko Joseph (suing as the legal representative of the Estate of Joseph Kilinda) v Bamburi Cement Ltd
    [2017] eKLR
  • Feba Radio (Kenya) Limited T/A Feba Radio v Ikiyu Enterprises Limited
    [2017] eKLR
  • Jiwaji v Jiwaji
    (1968) E.A 547
  • The Board of Trustees NSSF vs Micheal Mwalo
    Court of Appeal No. 293/2014
  • KBC vs Specialised Engineering Company Limited
Jurisdiction invoked
Inherent review jurisdiction over its own ruling (grounds of error apparent on the face of the record); no specific provision invoked

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, "Esther Mutembei v Oracle Systems Limited [2020] KEELRC 933 (KLR)", Case Analysis (2020). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/933/eng@2020-05-28

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