Acturial & Benefits Consultant Limited v Orbit Chemical Industrial Limited & another (Cause E783 of 2021) [2022] KEELRC 1286 (KLR)
The bottom line
#What this practically means
#Executive summary
#Key legal issues
#Jurisdiction of the ELRC over consultancy arrangements
The court lacked jurisdiction because the dispute was a contract for services, not an employment relationship
Applying the tests for identifying an employment relationship (integral part of business, control, method of payment, etc.), the court agreed with the claimant that the dispute was contractual. The claim was for unpaid consultancy fees, which does not fall within Article 162(2)(a) and section 12 of the ELRC Act. Where a court lacks jurisdiction it must down its tools.
Whether the suit should be transferred rather than struck out
Transfer refused; the claim was struck out instead
The claimant relied on Article 159 and authorities such as Manpower Networks Limited and Spedag Interfreight to seek transfer to the High Court. The court held that transfer was not appropriate since the suit would have to be amended, and instead struck out the claim, choosing the most practical remedy available to it.
Limitation under section 90 of the Employment Act
Not determinatively decided; claimant argued the applicable limitation was six years under section 4(1) of the Limitation of Actions Act for contractual claims
The claimant submitted that the dispute being contractual, the six-year limitation period in section 4(1) of the Limitation of Actions Act applied, and the suit filed in September 2021 relating to services rendered from September 2019 was within time. The court's disposition rested on jurisdiction, rendering this ground unnecessary to resolve definitively.
Suit contra statute under section 3(1) of the Law of Contract Act
Claimant argued the ground required evidence and was unsuitable for a preliminary objection
The claimant submitted that contracts may be oral or arise from written correspondence, and that determining whether a contract contrary to section 3(1) existed would require viva voce evidence, making it unsuitable for determination as a preliminary objection under the Mukisa Biscuit standard. The court agreed some aspects would require evidence.
Legal principles established
#- The ELRC's jurisdiction is confined to disputes between employer and employee; a claim for unpaid consultancy fees is not such a dispute and belongs to the High Court.
Court orders
#- 1.The claim is struck out
- 2.No order as to costs
- Jurisdiction invoked
- Article 162(2)(a) of the Constitution of Kenya; section 12 of the Employment and Labour Relations Court Act
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Acturial & Benefits Consultant Limited v Orbit Chemical Industrial Limited & another (Cause E783 of 2021) [2022] KEELRC 1286 (KLR)", Case Analysis (2022). Not stated in excerpt (Statement of Claim dated 6th September 2021). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/1286/eng@2022-07-13
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.