Kenya Union of Domestic Hotels, Educational Institutions, Hospitals and Allied Workers (KUDHEHIA) v Management of Tea Hotel & 4 others; Yas Angwan Holdings Limited & another (Proposed Interested Parties) [2022] KEELRC 1072 (KLR)
The bottom line
#Kenya's Employment Court in Kericho cancelled a Kshs 110 million hotel auction because the auctioneer sold the wrong parcel without following the required procedures.
What this practically means
#Executive summary
#Key legal issues
#Whether the auction sale of Block 4/295 complied with Order 22 Rule 57 of the Civil Procedure Rules
The sale did not comply and was tainted with fraud; the advert deviated from Form No. 15 and a different parcel was sold than that authorised for execution
The court found no directions were given on the mode of sale as required by Order 22 rule 57(5), and the advert placed by the auctioneer deviated from the prescribed Form No. 15 under rule 57(6). Further, the court had authorised sale of Block 4/313, yet the auctioneer advertised and sold Block 4/295, a different parcel altogether, leading to the conclusion that the sale was fraudulent.
Whether the application dated 26.4.2021 was res judicata
It was not; the prior applications and appeal concerned stay of execution, not cancellation of register entries
The court distinguished the earlier applications before J. Mbaru and the Court of Appeal, which related to staying execution and were struck out or dismissed, from the current application seeking cancellation of entries in the register. Since the earlier matters dealt with stay and left the applicant room to file a proper application, section 7 of the Civil Procedure Act was not offended.
Whether the court could entertain the interpleader and the PAYE/SACCO remittance directions sought
The chamber summons was rejected for want of jurisdiction over those remittance issues
The court accepted the purchasers' submission that questions of remitting PAYE to the Kenya Revenue Authority and SACCO loan deductions fall within the Tax Tribunal and Co-operative Tribunal, not the ELRC. Consequently the chamber summons by Kemboi Chambers Advocates seeking those directions and release of balances was unmerited and was rejected.
Whether the advocates and the SACCO should be joined as interested parties
Both joinder applications were dismissed as they would add no value to the proceedings
Migiro & Co. Advocates' claim was solely against the applicant and was already before the court in Misc. Application No. 14 of 2021, the correct forum. Ndege Chai Sacco's claim was against its members who are not parties to the suit and could be pursued separately. Joinder of either would not aid just and expeditious determination.
Legal principles established
#- An execution sale by public auction must comply strictly with the prescribed advertisement format; deviation renders the sale fraudulent and liable to be set aside
- A stay application disposed of earlier does not bar a later substantive application to cancel register entries; such an application is not res judicata
- The Employment and Labour Relations Court has no jurisdiction to direct remittance of PAYE to KRA or SACCO deductions; those belong to the Tax Tribunal and Co-operative Tribunal
Court orders
#- 1.An order of mandatory injunction compelling the Chief Land Registrar, Kericho to cancel the illegal entries on L.R. No. Kericho Municipality Block 4/295 measuring 5.831 acres
- 2.Orders setting aside the purported sale and eventual transfer of L.R. No. Kericho Municipality Block 4/295 to the purported purchasers
- 3.A mandatory injunction compelling the Respondents to file before the court the true and just accounts of monies paid by the purchasers and amounts paid to each employee out of the sale
- 4.A mandatory injunction compelling Hegeons Auctioneers to file before the court the details of the public auction including date, time, place, records of the auction, bidders and respective bids
- 5.Liberty to the claimant to institute proper execution proceedings devoid of fraud after accounts are rendered by the auctioneer
- 6.Costs of the application dated 26.4.2021 to be borne by the claimants
- 7.Dismissal of the application dated 21/7/2021 by Migiro & Co. Advocates seeking joinder
- 8.Dismissal of the application dated 20/9/2021 by Ndege Chai SACCO Ltd seeking joinder
- 9.Rejection of the chamber summons dated 14th July 2021 by Kemboi Chambers Advocates
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction over the employment dispute, with reliance on Rule 32 of the ELRC Court Rules and the Civil Procedure Rules for execution; the court also asserted power under section 56 of the Advocates Act and sections 23 and 28 of the Auctioneers Act
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenya Union of Domestic Hotels, Educational Institutions, Hospitals and Allied Workers (KUDHEHIA) v Management of Tea Hotel & 4 others; Yas Angwan Holdings Limited & another (Proposed Interested Parties) [2022] KEELRC 1072 (KLR)", Case Analysis (2022). ELRC Cause (Kericho) – claim filed 29/1/2016; applications dated 26th April 2021, 14th July 2021, 21st July 2021 and 20th September 2021. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/1072/eng@2022-01-18
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.