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ELRCStruck OutCause No 828 of 2022· [2024] KEELRC 2211 (KLR)

Butoyi (As a substitution for Canute Ifute Butoyi - Deceased) v Attorney General (Cause 828 of 2022) [2024] KEELRC 2211 (KLR)

Employment and Labour Relations Court
18 September 2024
JGJACOB GAKERI
2,751 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
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The bottom line

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Kenya's Employment Court ruled it cannot hear pension claims by retired workers, striking out an estate's Kshs.7.98 million interest claim.

What this practically means

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Executive summary

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The claimant, the estate of Canute Ifute Butoyi (deceased), a former civil servant who rose to Under Secretary in the Ministry of Agriculture and retired in October 1996, sought Kshs.7,980,000.00 plus interest, contending that his pension of Kshs.3.5 million paid in 2014/2015 excluded interest for the long delay in payment. The delay was attributed to a 1997 directive by the Public Service Commission, under the former Constitution's Section 113(1), withholding his benefits due to pending criminal charges for neglect of duty, from which he was acquitted in 1999; the directive was rescinded in 2014 and dues paid. The estate relied on Section 5 of the Pension Act, Section 53A of the Retirement Benefits Act and the Okoiti decision on contributory schemes. The Attorney General denied liability, arguing the Director of Pensions lacked authority to pay while the withholding directive stood, and that a Defined Benefit pension funded by the Consolidated Fund earns no interest; it further challenged the court's jurisdiction, citing Chaurembo, Karisa Chengo and Christopher Warui. Framing two issues - jurisdiction and entitlement to interest - the court, guided by Owners of Motor Vessel 'Lillian S' and Samuel Kamau Macharia, held that neither Article 162(2)(a) nor the ELRC Act confers jurisdiction over pension claims, particularly where the claimant is a pensioner no longer in an employment relationship. The suit was struck out for want of jurisdiction with each party bearing its own costs.

Key legal issues

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01

Jurisdiction of the ELRC over pension interest claims

Holding

The court has no jurisdiction to hear and determine the suit

Reasoning

Applying Owners of Motor Vessel 'Lillian S' and Samuel Kamau Macharia, jurisdiction flows from the Constitution or statute. Article 162(2)(a) and Section 12(1) of the ELRC Act confine the court to employment and labour relations disputes. Relying on Chaurembo, a pensioner is no longer an employee; pension disputes fall under the Retirement Benefits Act regime, not the ELRC. The claim for interest on pension dues paid some 20 years after retirement is therefore outside the court's mandate.

p. 5
02

Entitlement to interest on delayed pension payment

Holding

Not determined; the suit was struck out for want of jurisdiction before reaching the merits

Reasoning

Although counsel disputed whether interest was payable on a Defined Benefit pension financed by the Consolidated Fund, and relied on the Okoiti decision and Sections 5 of the Pension Act and 53A of the Retirement Benefits Act, the court never reached this issue because it found it lacked jurisdiction and struck out the suit.

p. 6

Legal principles established

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  • The ELRC has no jurisdiction to hear and determine disputes grounded on pension where the claimant is a pensioner no longer in an employment relationship
  • A court without jurisdiction must halt proceedings

Court orders

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  1. 1.The Claimant's suit against the Respondent is struck out for want of jurisdiction
  2. 2.Each party to bear own costs

Authorities

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Legislation

  • Penal CodeSection 128
  • Pension ActSection 5
  • Retirement Benefits ActSection 53A
  • Retirement Benefits ActSection 53B
  • Constitution of KenyaArticle 162(2)(a)
  • Constitution of KenyaSection 113(1) (former Constitution)
  • Employment and Labour Relations Court ActSection 12(1) and 12(2)
  • Employment ActNot specified
  • Trustee ActCap 167
  • Civil Procedure RulesOrder 21 Rule 1
  • Constitution of KenyaArticle 159(2)(d)
  • Constitution of KenyaArticle 48
  • Civil Procedure ActSection 1B

Cases cited (7)

  • Okoiti & 11 others v County Governments Retirement Scheme & 164 others; County Pension Fund Financial Services Ltd & 8 others (Interested Parties)
    (2022) KEELRC 13584
  • Republic v Karisa Chengo & 2 others
    (2017) eKLR
  • Albert Chaurembo Mumba & 7 others v Maurice Munyao & 148 others
    (2019) eKLR
  • Christopher Warui v Office of the Auditor General & another
    (2021) eKLR
  • Owners of Motor Vessel "Lillian S" v Caltex Oil (Kenya) Ltd
    (1989) KLR
  • Samuel Kamau Macharia & another v Kenya Commercial Bank & 2 others
    (2012) eKLR
  • Kenya Ports Authority
    Civil Appeal No. 236 of 2012
Jurisdiction invoked
Article 162(2)(a) of the Constitution and Section 12 of the Employment and Labour Relations Court Act

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, "Butoyi (As a substitution for Canute Ifute Butoyi - Deceased) v Attorney General (Cause 828 of 2022) [2024] KEELRC 2211 (KLR)", Case Analysis (2024). Cause No 828 of 2022. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2211/eng@2024-09-18

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