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ELRCDismissedELRCC (Notice of Motion dated 10th June 2024, arising from amended Memorandum of Claim dated 7th June 2024)· [2024] KEELRC 2553 (KLR)
Ndubi v Utumoja Technologies Ltd (Cause E427 of 2024) [2024] KEELRC 2553 (KLR)
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·~10 min to read original · ~4 min briefThe bottom line
#What this practically means
#Executive summary
#The Claimant, Sharon Feliste Bundi, moved the Employment and Labour Relations Court by Notice of Motion dated 10th June 2024 seeking pre-judgment security orders arising from an employment dispute in which she alleged her salary was unilaterally cut from Kshs. 350,000 to Kshs. 140,000 for eight months and her contract terminated without notice, total unpaid salary of KShs. 2,599,767.68. She sought orders that the sole director/shareholder, Jason Robert Eisen, deposit his passport in court, that the Respondent deposit a sum equal to the claim, or alternatively that the sum be held in a joint interest-earning account, on the ground that the Respondent is foreign-owned with no known attachable assets and had admitted lacking funds. The Respondent, in a Replying Affidavit sworn by Jason Robert Eisen, opposed the application as an attempt to determine the suit's merits at an interlocutory stage, asserting that two directors are Kenyan citizens, that it operates a registered office at Diamond Plaza, Parklands, that it remains a going concern, and that the Claimant resigned rather than being dismissed. The Claimant filed a Supplementary Affidavit denying the resignation and reiterating the Respondent's lack of disclosed assets. Justice Stella Rutto framed the sole issue as whether the court should order the Respondent to deposit a sum equal to the claim pending trial, characterising the relief as attachment before judgment under Order 39 Rule 5 of the Civil Procedure Rules. Relying on Kuria Kanyoko, Saving and Loan Kenya Limited and Afrofreight Forwarders, she held such orders are draconian and require clear proof that the defendant intends to obstruct or delay execution by disposing of or removing property. Finding only apprehension, not proof of such intent, the court declined all the orders sought and directed the parties to fast-track the main suit. Costs were awarded in the cause.
Key legal issues
#01
Whether an order of attachment before judgment (or security in the sum claimed) should issue against the Respondent pending hearing of the suit
Holding
The application failed because the Claimant did not demonstrate that the Respondent intended to obstruct or delay execution by disposing of or removing its property from the jurisdiction.
Reasoning
Order 39 Rule 5(1) requires proof that the defendant, with intent to obstruct or delay execution of a decree, is about to dispose of property or remove it from the court's jurisdiction. Drawing on Kuria Kanyoko, Saving and Loan Kenya and Afrofreight Forwarders, the court held such orders are draconian and must be granted with utmost circumspection. The Claimant's fear that the Respondent, being foreign-owned with no known assets, would be judgment-proof was mere apprehension. Two directors are Kenyan nationals, and the Respondent maintains an office and ongoing projects.
p. 4
Legal principles established
#- The power to attach before judgment must not be exercised lightly and requires clear proof that the defendant is about to dispose of property or remove it from the jurisdiction with intent to obstruct or delay execution of a decree
- Mere apprehension, however well grounded, without evidence that the defendant intends to do what is feared, does not suffice for attachment before judgment
- A defendant's non-disclosure of assets or lack of Kenyan shareholders is not, without proof of intent to defeat execution, sufficient ground for attachment before judgment
Court orders
#- 1.Declined to grant the orders sought in the instant Application
- 2.Directed that parties fast-track the hearing of the main suit
- 3.Costs shall be in the cause
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment and Labour Relations Court Act read with Order 39 Rule 5 of the Civil Procedure Rules
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Ndubi v Utumoja Technologies Ltd (Cause E427 of 2024) [2024] KEELRC 2553 (KLR)", Case Analysis (2024). ELRCC (Notice of Motion dated 10th June 2024, arising from amended Memorandum of Claim dated 7th June 2024). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2553/eng@2024-10-18
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.