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ELRCPartially AllowedNot stated in the judgment· [2023] KEELRC 1225 (KLR)

ASA Limited v Wekesa & another (Cause 38 of 2016) [2023] KEELRC 1225 (KLR)

Employment and Labour Relations Court
18 May 2023
JGJacob Gakeri
2,869 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~11 min to read original · ~4 min brief

The bottom line

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A Kenyan employer won notice pay against a worker who deserted, but lost its fraud claim because it had no solid proof like an investigation report.

What this practically means

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Executive summary

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The Claimant company sued its two former Loan Officers, alleging that the 1st Respondent deserted duty from 1st December, 2014 without giving the contractual one month's notice and misappropriated Kshs.271,125, and that the 2nd Respondent, whose employment was terminated on 7th August, 2015, was responsible for three fake loans and misappropriation of Kshs.49,149, of which Kshs.37,314 remained owing. The Claimant sought damages for breach of contract, recovery of the amounts, interest and costs. The suit was undefended; the Respondents were served by registered post and email but did not participate. The court (Gakeri J) first restated that in undefended claims the claimant must still prove all facts on a balance of probabilities, whether the claimant is employer or employee. It upheld jurisdiction under Article 162(2)(a) of the Constitution and Section 12 of the ELRC Act. On desertion, the court found the Claimant had demonstrated reasonable efforts to contact the 1st Respondent through two letters and found desertion proved, entitling the Claimant to salary in lieu of notice under Clause 6(c) of the appointment letter. However, on misappropriation, the Claimant's evidence - system printouts, an incomplete and undated OB extract, and a witness statement silent on the printouts and amounts - fell short; no investigation report was produced and no synthesis of the alleged losses was presented. The court found the misappropriation claim and the general damages claim for breach of contract unproven. Judgment was entered only against the 1st Respondent for salary in lieu of notice, with 50% of costs to the Claimant and interest at court rates from the date of judgment.

Key legal issues

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01

Jurisdiction of the ELRC over employer claims against former employees, including claims with tortious elements

Holding

The court has jurisdiction under Article 162(2)(a) of the Constitution and Section 12 of the ELRC Act over employment and labour relations disputes, including claims against employees arising from the employment relationship.

Reasoning

Article 162(2)(a) establishes courts with the status of the High Court for employment and labour disputes, and Section 12 of the ELRC Act confers exclusive original and appellate jurisdiction, including power to award damages. Because the dispute arose from the employment relationship, tortious aspects connected to it fall within that jurisdiction.

p. 4
02

Whether the Claimant proved misappropriation of funds by the Respondents

Holding

Claimant failed to prove misappropriation on a balance of probabilities; the claim for recovery as special damages failed.

Reasoning

The printouts did not show total amounts misappropriated, no investigation was conducted, the OB extract was incomplete and undated, the witness statement made no reference to the printouts or amounts, and there was no update on police investigations. The burden under Sections 107(1) and 108 of the Evidence Act lay squarely on the Claimant.

p. 6
03

Whether the 1st Respondent deserted duty and whether the Claimant is entitled to pay in lieu of notice

Holding

The 1st Respondent deserted the workplace from 1st December, 2014, and the Claimant is entitled to salary in lieu of notice under Clause 6(c) of the appointment letter.

Reasoning

The Claimant produced two letters (11th December, 2014 and 13th January, 2015) showing attempts to reach the 1st Respondent and warning of recovery proceedings, satisfying the requirement that an employer pleading desertion demonstrate efforts to contact the employee. The appointment letter provided for termination by 30 days' notice of either party.

p. 5
04

Standard of proof in undefended suits

Holding

An undefended claim does not lighten the claimant's burden; all facts must be proved on a balance of probabilities.

Reasoning

Relying on Monica Kanini Mutua v Al-Arafat Shopping Centre and Nicholus Kipkemoi Korir v Hatari Security Guards Ltd, the court held that the claimant must establish all facts, including the employment relationship, regardless of the absence of the respondents, applying Sections 107, 108 and 109 of the Evidence Act.

p. 4

Legal principles established

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  • In an undefended suit, the claimant still bears the burden of establishing all facts alleged to the standard of a balance of probabilities, whether the claimant is employer or employee.
  • An employer who pleads desertion or absconding of duty must demonstrate the efforts expended to contact the employee to explain the absence.
  • Misappropriation of funds by an employee must be proved as special damages with concrete evidence such as an investigation report.

Court orders

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  1. 1.Judgment entered for the Claimant against the 1st Respondent for salary in lieu of notice.
  2. 2.Claimant awarded 50% of the costs in light of partial success.
  3. 3.Interest at court rates from the date of judgment till payment in full.

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 162(2)(a)
  • Constitution of Kenya, 2010Article 41(1)
  • Constitution of Kenya, 2010Article 159(2)(d)
  • Constitution of Kenya, 2010Article 48
  • Employment and Labour Relations Court Act, 2011Section 12
  • Employment and Labour Relations Court Act, 2011Section 12(3)
  • Employment Act, 2007Section 87(1)
  • Evidence ActSection 107(1)
  • Evidence ActSection 108
  • Evidence ActSection 109
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure ActSection 1B

Cases cited (7)

  • Kenneth Onialo v Majlis Resort Lamu t/a Majlis Lamu Ltd
    (2022) eKLR
  • Ronald Nyambu Daudi v Tornado Carriers Ltd
    (2019)
  • Humphrey Munyithya Mutemi v Soluxe International Group of Hotels and Lodges Ltd
    (2020) eKLR
  • Monica Kanini Mutua v Al-Arafat Shopping Centre & another
    (2018) eKLR
  • Nicholus Kipkemoi Korir v Hatari Security Guards Ltd
    (2016) eKLR
  • Felistas Acheha Ikatwa v Charles Peter Otieno
    (2018) eKLR
  • Judith Atieno Owuor v Sameer Agricultural & Livestock Ltd
    (2020) eKLR
Jurisdiction invoked
Article 162(2)(a) of the Constitution of Kenya, 2010 and Section 12 of the Employment and Labour Relations Court Act, 2011

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (2)

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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, "ASA Limited v Wekesa & another (Cause 38 of 2016) [2023] KEELRC 1225 (KLR)", Case Analysis (2023). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/1225/eng@2023-05-18

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