Moiz Motors Limited v Oprisianu & 3 others (Civil Appeal E285 of 2024) [2024] KEHC 13337 (KLR) (Civ) (31 October 2024) (Ruling) 

A.N. Ongeri-Judge 

Brief facts 

The applicant sought a stay of execution of the judgment pending the lodging of the appeal. The applicant had initially sought a review of the judgment. 

Issues for determination 

Can a party appeal against a reviewed decision? 

Was the applicant entitled to stay of execution? 

Rule of law 

Order 45 Rule 1 of the Civil procedure Rules and Section 80 of the Civil Procedure Act provide that a party may seek a review from the same court that issued a decision for the judicial officer to relook at the decision. Some of the grounds are the discovery of new and important evidence, an error in the face of the record and any other sufficient reason. 

Order 42 rule 6 of the Civil Procedure Rules provides that on application of a party, the court may order a stay of execution pending determination of an appeal. 

Holding and reasoning of the court 

The court held that the right to review does not extinguish the right to appeal since at the time he lodged an application for review, he did not prefer an appeal.  

In allowing the stay of execution of the court directed that the stay was justified since the appeal was arguable and directed the applicant to furnish the whole decretal amount as security. 

Disposition 

The court granted the applicant leave to appeal out of time. 

The court granted stay pending appeal of the decision. 

Scuttling the pending proceedings by making a quick appointment under section 534 of the Act is done in bad faith and such appointment is stayed pending the determination of the insolvency proceedings.

The Environment & Land Court and Employment & Labour Relations Court cannot transfer suits to the High Court and vice-versa when they find that they have no jurisdiction to hear and determine the dispute.

The Supreme Court in Albert Chaurembo Mumba & 7 others (sued on their own behalf and on behalf of predecessors and or successors in title in their capacities as the Registered Trustees of Kenya Ports Authority Pensions Scheme) v Maurice Munyao & 148 others (suing on their own behalf and on behalf of the Plaintiffs and other Members/Beneficiaries of the Kenya Ports Authority Pensions Scheme) [2019] eKLR while addressing the question of whether the ELRC and ELC can transfer cases to the High Court and vice-versa stated that where a suit filed before a court is without jurisdiction, it could not be transferred to another court.

Although it had been the practice of the ELRC, ELC and the High Court, to transfer suits to the High Court and vice versa; in instances where the court finds that it has no jurisdiction, the said practice has since been held to be illegal. The Supreme Court succinctly held that an order for transfer of a suit from one court to another cannot be made unless the suit has been brought, in the first instance, to a court which has jurisdiction to try it.

In determining this it looked at the Jurisdictional limits of the superior courts in the resolution of disputes between pensioners or members, beneficiaries of a pension scheme, the Registered Trustees of the pension schemes, and the Sponsors of the schemes or employers in regard to the management of the pension schemes. Ordinarily, with the existence of sections 46 (1) and 48(1) of the RBA Act, the High Court, the Employment and Labour Relations Court, the Retirement Benefits Appeals Tribunal and the CEO heard and determined pension disputes involving retired employees.

The blowback to this was that there was uncertainty created in law by the discordant and inharmonious way similar disputes related to pensioners and Trustees of pension schemes was to be adjudicated before our courts, tribunals, and statutory bodies with quasi-judicial authority.

In finding that the proper forum for the respondents in the case to launch their dispute was to first write to the CEO then if dissatisfied with the decision of the CEO appeal to the Retirement Benefits Appeals Tribunal and ultimately to the ELRC; The Court found that despite the parties consenting to the transfer the suit from the High Court to the Employment and Labour Relations Court the suit was a nullity ab initio as jurisdiction could not be conferred by consent, as it is not provided for by the law and ultimately, all orders emanating from that suit were termed null and void.

The Court held that, though a Court may be vested with the requisite and sweeping jurisdiction to hear and determine certain issues as may be presented before it for adjudication, it should nonetheless exercise restraint or refrain itself from making such determination, if there would be other appropriate legislatively mandated institutions and mechanism. Hence, the Ex parte Applicants ought to have invoked the jurisdiction of National Environment Tribunal under section 125 and 129 (3) of Environment Management and Coordination Act before moving the ELC.

As for the ELC it failed in adhering to the principle of exhaustion which provides for the need to explore all other available mechanisms in dispute resolution before proceeding to the Courts. The proper procedure as emancipated by the Supreme Court would have been to reserve the constitutional issues on the rights to a clean and healthy environment, pending the determination of the issue with regards to the issuance of EIA licenses at the Tribunal, thereby affording any aggrieved party the opportunity to appeal to the Court. It would then have determined the reserved issues, alongside any of the appealed matter, if at all, thus ensuring the parties right to a fair hearing under Article 50 of the Constitution was protected.

The Conclusion of it all was that, the ELC had usurped the jurisdiction of statutorily instituted and legally mandated bodies, to wit, the National Environmental Tribunal and the National Environmental Complaints Committee, by arrogating upon itself the jurisdiction to hear and determine issues that were not within its purview.

The Court asserted that there lies some commonality between the past concept of Receiver-manager and the contemporary concept of Administration and since the Debenture empowers the bank to appoint a Receiver under the provisions of the repealed Companies Act, then that power can be deemed to include power to appoint an Administrator. This was so as not to disadvantage debenture holders who held debentures that predated the Act, and hence the need to give a purposive interpretation to the provisions of section 534(2)(b).

11. A Debenture Holder of a Qualifying Floating Charge cannot appoint an Administrator where there are pending insolvency proceedings.

In Re: Arvind Engineering Limited ML HC IP No. 03 of 2019 [2019] eKLR the High Court also held that where there’s any pending insolvency proceedings, the Debenture Holder once made aware of such proceedings ought to remain in those proceedings and make arguments for or against the grant of the order.

Scuttling the pending proceedings by making a quick appointment under section 534 of the Act is done in bad faith and such appointment is stayed pending the determination of the insolvency proceedings.

The Environment & Land Court and Employment & Labour Relations Court cannot transfer suits to the High Court and vice-versa when they find that they have no jurisdiction to hear and determine the dispute.

The Supreme Court in Albert Chaurembo Mumba & 7 others (sued on their own behalf and on behalf of predecessors and or successors in title in their capacities as the Registered Trustees of Kenya Ports Authority Pensions Scheme) v Maurice Munyao & 148 others (suing on their own behalf and on behalf of the Plaintiffs and other Members/Beneficiaries of the Kenya Ports Authority Pensions Scheme) [2019] eKLR while addressing the question of whether the ELRC and ELC can transfer cases to the High Court and vice-versa stated that where a suit filed before a court is without jurisdiction, it could not be transferred to another court.

Although it had been the practice of the ELRC, ELC and the High Court, to transfer suits to the High Court and vice versa; in instances where the court finds that it has no jurisdiction, the said practice has since been held to be illegal. The Supreme Court succinctly held that an order for transfer of a suit from one court to another cannot be made unless the suit has been brought, in the first instance, to a court which has jurisdiction to try it.

In determining this it looked at the Jurisdictional limits of the superior courts in the resolution of disputes between pensioners or members, beneficiaries of a pension scheme, the Registered Trustees of the pension schemes, and the Sponsors of the schemes or employers in regard to the management of the pension schemes. Ordinarily, with the existence of sections 46 (1) and 48(1) of the RBA Act, the High Court, the Employment and Labour Relations Court, the Retirement Benefits Appeals Tribunal and the CEO heard and determined pension disputes involving retired employees.

The blowback to this was that there was uncertainty created in law by the discordant and inharmonious way similar disputes related to pensioners and Trustees of pension schemes was to be adjudicated before our courts, tribunals, and statutory bodies with quasi-judicial authority.

In finding that the proper forum for the respondents in the case to launch their dispute was to first write to the CEO then if dissatisfied with the decision of the CEO appeal to the Retirement Benefits Appeals Tribunal and ultimately to the ELRC; The Court found that despite the parties consenting to the transfer the suit from the High Court to the Employment and Labour Relations Court the suit was a nullity ab initio as jurisdiction could not be conferred by consent, as it is not provided for by the law and ultimately, all orders emanating from that suit were termed null and void.

The two sections provide:

41. Notification and hearing before termination on grounds of misconduct

(1) Subject to section 42(1), an employer shall, before terminating the employment of an employee, on the grounds of misconduct, poor performance or physical incapacity explain to the employee, in a language the employee understands, the reason for which the employer is considering termination and the employee shall be entitled to have another employee or a shop floor union representative of his choice present during this explanation.

(2) Notwithstanding any other provision of this Part, an employer shall, before terminating the employment of an employee or summarily dismissing an employee under section 44(3) or (4) hear and consider any representations which the employee may on the grounds of misconduct or poor performance, and the person, if any, chosen by the employee within subsection (1), make.

42. Termination of probationary contracts

(1) The provisions of section 41 shall not apply where a termination of employment terminates a probationary contract.

In coming up the judgement, the courts relied on the South African and Canadian Jurisprudence. The court stated that Article 47 of the Constitution of Kenya 2010 confers on every person the right to administrative action, it went further to state that the spirit of Article 47 has been incorporated in the Employment Act in Section 41. The court also noted that labor rights are part of the Bill of Rights by virtue of Article 41 of the Constitution, and which cannot be limited according to Article 24(1) of the Constitution of Kenya. The court also expressed their concern that it does not make sense to accord an apprentice and indentured learner who is included in the definition of an employee under section 2, the procedural benefits of section 41 but deny the same to an employee simply because they hold a probationary contract.

According to the court, any legislation which intends to limit or qualify a labour right, ought to be to the extent that the limitation or qualification is reasonable and justifiable in an open and democratic society. Together with inconsistencies amongst section 42(1),42(2) and 41, the court held that insofar as section 42(1) exclude an employee holding a probationary contract from the provision of section 41 of the same Act, is inconsistent

The learned Judged observed that it was readily obvious that the applicant was being targeted because of his work as a lawyer for his client in his capacity as an advocate. The court observed that the DPP did not make allegations that the Applicant somehow trembled the lawyer-client relationship into a forbidden zone. The court noted that such a prosecution was definitionally prejudicial to the Applicant and inimical to public interest. The court was quick to point out that this was not in any way to suggest that Advocates are presumptively immunized from prosecution before scrutiny by the courts.

The court insisted on the sacred and important role played by lawyers in Constitutional democracies and dangers involved in unfairly identifying them with their clients causes.

The court said that the prosecution of lawyers for their advocacy work on behalf of their clients is one of the surest ways of sifting a vibrant democracy and that it’s inimical effects on the society cannot be overemphasized. The judge also emphasized that the prosecutor needs to demonstrate to the court that the (Lawyer) traveled outside his remit as a lawyer to facilitate a crime or show that the intended prosecution is unrelated to his work as a lawyer. But before then, it is prudent for the court to act with abundance of caution to protect the sacred lawyer-client relationship.

Arising in the time of COVID-19, the matter was originated on a question of whether an AGM had been properly convened given that it was done so on an online platform, between SCANAD and the Capital Markets Authority, -the Court pronounced itself in the order on the impracticability of insisting on physical meetings given the COVID 19 guidelines.

This case was further cited in the decided matter of In re Application for Leave to hold the postponed Law Society of Kenya Annual General Meeting Virtually [2020] eKLR where the Society sought the Court’s pronouncement on the issue of virtual meetings since there was no law addressing the same. The Court relied on the meaning of venue in Black’s Law Dictionary in finding that a virtual platform qualified as a venue stating as follows:

“18. The venue is a place where more than one person may meet and/or congregate. The purpose of physical venue for a meeting is therefore to bring persons to a physical space with a view to them communicating in whatever form and/or manner so as to conduct their business.  The ongoing COVID-19 pandemic has brought about innovations to ensure that people still meet and still transact the same business that could also have been transacted in a meeting had they congregated physically. This is being done through various virtual platforms.

19. As a virtual platform is a defined space where people can log in at the same time and meet to transact the same business as they would have transacted had they been in a physical space at the same time, it would in the mind of this court be considered as a “venue”. As online banking, online schooling, online consultation and so forth are means by which people interact and achieve their objectives, there is therefore no reason why virtual space could not be recognised and/or accepted as a venue to meet and transact whatever business one may have.”

The Scangroup decision being the first of its kind can be said to have contributed to the Amendment of the Companies Act through the Business Laws Amendment Act No. 1 of 2021 that has sought to include virtual and hybrid i.e part physical part virtual meetings under the definition of general meetings, a step forward an embrace of the changes brough by COVID 19.

In a decision that relied heavily on the earlier landmark decision of the Supreme Court in Supreme Court Reference No 2 of 2013, the Court of Appeal refused to allow the Acts, enacted to the exclusion of the Senate to remain, denouncing what was argued as “institutional comity” and holding that the effect of nullifying 23 Acts should have been considered by the National Assembly. In concluding its judgement, the Court faulted the National Assembly for failing to consider the consequences of their actions and insisted that its role as the Court.

While admitting that the Court in Judicial Review is traditionally a “process-only” the Court questioned the manner of inquiring into the formalities of an administrative decision without looking into the circumstances themselves and found it absurd to ignore and skip over the circumstances.

Long seen as a purely procedural inquiry, judicial review has over the years, since the promulgation of the Constitution of Kenya 2010, with the right to fair administrative Action under Article 47 and the grounds provided under the Fair Administrative Action Act, section 7, seen an evolution from what the Court in the Njora case called a “misconception that judicial review is limited to a dry or formalistic examination of the process while strenuously and artificially avoiding merit”.

The Court declared that such an approach to judicial review could only lead to “intolerable superficiality.”