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ELRCDismissedNot stated in judgment· [2025] KEELRC 133 (KLR)

Kenya Institute of Management v Wakhanu (Appeal E066 of 2024) [2025] KEELRC 133 (KLR)

High Court of Kenya (Employment and Labour Relations appellate jurisdiction, Kisumu)
29 January 2025
JGJacob Gakeri
2,419 words in judgment
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The bottom line

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A Kenyan High Court ruled that a 'without prejudice' settlement letter became enforceable once the employee accepted it, so it could be used as evidence.

What this practically means

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Executive summary

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This is a first appeal against a ruling of Principal Magistrate Maureen Nyigei delivered on 5th November 2024, in which the trial court allowed the claimant (respondent) to rely on a letter dated 5th September 2023 written by the employer (appellant) on a 'without prejudice' basis. The employer had sought to expunge the letter from the claimant's list of documents, contending it was privileged under Section 23(1) of the Evidence Act and inadmissible. The claimant countered that the letter contained an offer which he accepted, and that the without-prejudice rule has exceptions. Dr. Jacob Gakeri J framed a single issue: whether the letter of 5th September 2023 was admissible. Reviewing Section 23(1) of the Evidence Act and authorities including Walker v Wilsher, Rush & Tomkins, Lochab Transport, Mumias Sugar and the Court of Appeal's decision in Heineken East Africa Imports, the court held that the without-prejudice rule, though grounded in public policy, is not absolute. The letter was an unambiguous offer to settle salary arrears by instalments of Kshs.50,000, signed by three senior officers of the appellant, and the respondent's execution of a certificate of no further liability on 6th September 2023 constituted acceptance. The letter therefore metamorphosed into a binding contract and became admissible. The court affirmed the trial magistrate's ruling, dismissed the appeal with no order as to costs, each party bearing its own costs, and delivered the judgment virtually at Kisumu on 29th January 2025 pursuant to the COVID-19 directives.

Key legal issues

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01

Admissibility of 'without prejudice' correspondence

Holding

The rule is grounded in public policy but is not absolute; where a without-prejudice offer is accepted, it establishes a contract and becomes admissible

Reasoning

The court traced the rule from Section 23(1) of the Evidence Act and English authorities (Walker v Wilsher, Rush & Tomkins, Unilever) to Kenyan decisions (Lochab Transport, Mumias Sugar) and the Court of Appeal in Heineken. It found the letter of 5 September 2023 was an unambiguous offer to settle salary arrears by instalments, accepted by execution of a certificate of no further liability on 6 September 2023, so it had metamorphosed into an enforceable contract. The trial magistrate's ruling admitting the letter was correct.

p. 5
02

Whether the appellant's letter constituted an offer capable of acceptance

Holding

Yes - the letter was an unambiguous offer which the respondent accepted by executing the certificate of no further liability

Reasoning

The letter, signed by three senior officers of the appellant, committed to settle salary arrears at Kshs.50,000 per month conditional on the respondent forfeiting his claim for project supervision arrears and executing a certificate of no further liability. The respondent executed that certificate on 6th September 2023, which the court treated as acceptance. Consequently the privilege under the without-prejudice rule fell away.

p. 5

Legal principles established

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  • Once an offer made on a 'without prejudice' basis is unequivocally accepted, a contract comes into existence and evidence of the contract and the terms of the 'without prejudice' letter are admissible

Court orders

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  1. 1.The appeal is dismissed
  2. 2.Each party to bear their own costs
On appeal from
Principal Magistrate's Court (Employment and Labour cause)
Not stated
Jurisdiction invoked
First appellate jurisdiction over the ruling of the Principal Magistrate (provisions not expressly cited in the extract)

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, "Kenya Institute of Management v Wakhanu (Appeal E066 of 2024) [2025] KEELRC 133 (KLR)", Case Analysis (2025). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/133/eng@2025-01-29

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