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ELRCPartially AllowedCause No 922 of 2016· [2024] KEELRC 2327 (KLR)

Havyarimana v Permanent Secretariat of the Transit and Transport Co-ordination Authrotiy of the Northern Corridor & another (Cause 922 of 2016) [2024] KEELRC 2327 (KLR)

Employment and Labour Relations Court
24 September 2024
ANAGNES KITIKU NZEI
1,003 words in judgment
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The bottom line

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A Mombasa court ruled that interest on unfair termination compensation only runs from the decree date, invalidating inflated auctioneer claims of over KShs 6.6 million.

What this practically means

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Executive summary

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This ruling by the Employment and Labour Relations Court at Mombasa (Agnes Kitiku Nzei, Judge) determines a Notice of Motion dated 22nd March 2024 filed by the Respondent following the Court's judgment of 26th October 2023, in which the Claimant was awarded USD 47,448 as compensation for unfair termination of employment, a certificate of service, costs and interest at Court rates. The Respondent, having paid USD 57,352 as principal sum and costs, complained that the Claimant nonetheless instructed auctioneers to execute for interest purportedly amounting to over Kshs. 6.68 million, and sought stay of execution, a declaration that the execution process was void ab initio, setting aside of warrants of attachment and sale and the proclamation notice, a finding that the decretal sum was fully settled and the interest tabulation excessive, and alternatively an order fixing interest at 6% from the date of judgment. The application, brought under Sections 1A, 1B, 3A and 94 of the Civil Procedure Act, Order 21 Rule 8(1) and (3) of the Civil Procedure Rules and Article 47 of the Constitution, was opposed by grounds of opposition. The Court held that its power to award interest is purely discretionary under Section 26; that where a decree is silent on pre-decree interest, none was awarded; and that an award of compensation for unfair termination is general damages ascertainable only upon the Court's decree, so interest runs only from the date of the decree at Court rates until payment in full. Any warrants containing different calculations were declared invalid. The application was allowed with each party bearing its own costs.

Key legal issues

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01

Date from which interest on a decretal sum awarded as general damages accrues

Holding

Interest on compensation for unfair termination, being in the nature of general damages, accrues only from the date of the decree, at Court rates, until payment in full.

Reasoning

Section 26 of the Civil Procedure Act confers a discretion on the Court to award interest, and where the decree is silent, further interest is deemed at 6% per annum. For pre-decree interest, the adjudged sum must be quantified and ascertainable at filing. An award of compensation for unfair termination is general damages ascertainable only upon hearing evidence, so interest can only run from the date of the decree awarding it.

p. 3
02

Validity of warrants of attachment and sale containing different interest calculations

Holding

Any warrants of attachment and sale stating otherwise or containing different calculations of interest are invalid.

Reasoning

Since interest runs only from the date of the decree at Court rates, warrants or proclamations founded on different (earlier or inflated) calculations of interest are inconsistent with the decree and cannot stand.

p. 3
03

Discretionary power to award interest on decreed sums

Holding

The Court's power to award interest on decreed sums is purely discretionary and governed by Section 26 of the Civil Procedure Act.

Reasoning

Section 26(1) permits the Court to order interest on the principal sum adjudged as it deems reasonable, with further interest from decree to payment; Section 26(2) deems further interest at 6% per annum where the decree is silent. The adjudging Court must specifically state any award of pre-decree interest in the decree.

p. 2

Legal principles established

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  • Where a decree does not state an award of interest for periods before or up to the date of the decree, no such interest was awarded
  • Interest on a general damages award (such as compensation for unfair termination) accrues only from the date of the decree, not from the date of filing suit

Court orders

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  1. 1.Interest on the adjudged sum of USD 47,448 to be calculated at Court rates from the date of the court's decree until payment in full, if not yet paid
  2. 2.Any warrants of attachment and warrants of sale stating otherwise or containing different calculations are invalid
  3. 3.The Notice of Motion dated 22nd March 2024 is allowed in the foregoing terms
  4. 4.Each party to bear its own costs of the application

Authorities

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Legislation

  • Civil Procedure ActSections 1A, 1B, 3A, 94 and 26
  • Civil Procedure RulesOrder 21 Rule 8(1) and (3)
  • Constitution of KenyaArticle 47
  • Employment ActSection 51(1)
Jurisdiction invoked
Sections 1A, 1B, 3A and 94 of the Civil Procedure Act; Order 21 Rule 8(1) and (3) of the Civil Procedure Rules; Article 47 of the Constitution of Kenya

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, "Havyarimana v Permanent Secretariat of the Transit and Transport Co-ordination Authrotiy of the Northern Corridor & another (Cause 922 of 2016) [2024] KEELRC 2327 (KLR)", Case Analysis (2024). Cause No 922 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2327/eng@2024-09-24

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