Confidentiality: The case of Njuki v CIC Insurance Group Ltd [2025] KEELRC 416 (KLR)

Brief Facts:

On confidentiality, in the above cited case, the Claimant was dismissed for transferring restricted company documents from his work email to his personal email without authorization, violating the Respondent’s policies on gross misconduct. 

 

 

Case Analysis:

The claimant did not dispute the transfer, explaining that he did so after being summoned by the Directorate of Criminal Investigations Insurance Fraud Investigation Unit regarding fraudulent KPLC public liability claims. Feeling threatened with prosecution, he gathered the documents for his self-defence. 

 

The Respondent argued that the documents contained critical and confidential information on fraudulent claims paid on behalf of KPLC. 

 

Court's Determination:

 

However, the court found that since the Claimant only transferred the information to his personal email and did not share it with unauthorized third parties, he did not breach the confidentiality clause in his contract. 

 

There was no evidence that the information was disseminated beyond his personal possession.

The full case is available Here

Right to Privacy: The Case of AMM v Spin Knit Limited [2013] KEELRC 573 (KLR)

 In the case of AMM v Spin Knit Limited [2013] KEELRC 573 (KLR), the claimant suffered an injury when he was attacked by thugs. Upon being discharged, he returned to work having been prescribed light duty but was still assigned heavy duty, resulting in him suffering further infection to his injuries. The employee attempted to seek compensation but the respondent refused to offer any assistance. Instead, the Respondent directed the claimant attend a mandatory HIV/AIDS test which he refused and was denied entry to the work place. He was thereafter terminated for non-attendance. The court found that the termination of the employee was improper as the respondent infringed on the claimant’s right to privacy.

 

Employers have a legitimate interest in ascertaining their employee’s health status to see if they are fit for their roles. However, this interest does not trump the employee’s right to privacy. The court in the case of AMM v Spin Knit Limited [2013] KEELRC 573 (KLR) held that where health status of the employee or the prospective employee has a bearing on the required qualifications or job specifications, it is sufficient for the employer to receive the doctor’s certificate of fitness without disclosing the full medical report that infringes the employee’s or prospective employee’s health status. An employer should highly restrict the disclosure of employees’ medical reports and hold them in high confidence that protects the employee’s privacy and therefore human dignity. An employer must not force an employee to undergo a medical examination or force the employee to present medical reports that expose the employee’s health status that the employee is entitled to hold in his or her privacy.

Right To Privacy: The case of Samuel K. Skinner v. Railway Labor Executives Association (489 U.S. 602)

In the US Supreme Court case Samuel K. Skinner v. Railway Labor Executives Association (489 U.S. 602), the Court held that both blood and urine tests were minimally intrusive. While the Court acknowledged that the act of passing urine was in itself intensely personal, obtaining a urine sample in a medical environment and without the use of direct observation amounted to no more than a minimal intrusion. The Court justified not only testing of urine but also testing of blood by focusing on the procedure of testing (i.e., "experience . . . teaches that the quantity of blood extracted is minimal,” and pointing out that since such tests are "common place and routine in everyday life," the tests posed "virtually no risk, trauma, or pain".. While such testing does amount to an imposition upon an employee (i.e., by requiring her to report to a physician and provide a urine sample) in a way that may not be commonplace for many employees, the Court ruled that since this takes place within an employment context (where limitations of movement are assumed), this interference is justifiable and does not unnecessarily infringe on privacy interests.

Compensation for unfair termination: The Case of H Young & Co. (E.A) Ltd v Kobong [2025] KEELRC 514 (KLR

Background of the case:

In the case, the Appellant argued that the trial court’s award of 10 months’ salary as compensation for unfair termination was excessively high, given that the Respondent had worked for only 2 years and 9 months. 

The Respondent, however, contended that since the Appellant did not challenge the trial court’s finding on termination and fairness, the award was reasonable and should stand. 

The appellate court emphasized that compensation must be reasonable and assessed with moderation under Section 49(4) of the Employment Act.

Analysis:
While acknowledging that 10 months’ compensation seemed high compared to similar cases, the court found no evidence that the Respondent contributed to the termination. 

It further noted that the maximum award of 12 months’ salary is not solely based on length of service but on the reason and circumstances of termination. 

Court's determination:

The court recognized that unfair dismissal can have severe consequences, whether for a long-serving employee or one who recently took a career risk by joining a new employer.

Read the full case at here

Right to Privacy: The case of VMK v CUEA [2013] eKLR

Background and Analysis of the case:

In the case, the respondent had given the claimant a contract of service on a casual basis as a telephone operator in 2000. In 2003, her supervisor recommended her for a higher position, which she applied for and under that application included a medical test that did not indicate the testing for HIV. After undergoing the test, she was informed she was HIV positive and thereafter her promotion bid failed, causing her to continue employment on a casual basis even while her co-workers were promoted. In 2006, she wrote to the Personnel Officer having been aggrieved by her employment status and meagre salary which was responded to seven months after, giving her a one-year contract without benefits enjoyed by her colleagues. She continued on these terms till 2010 when her contract was terminated. 

Court's DETERMINATION:

The court found that the actions of the respondent indicated that the real reason behind the non-renewal was her HIV status as indicated by their lack of intention to employ her on permanent terms and thus resulted in unfair termination.

Value Added Tax (VAT) on transactions for the sale or purchase of land and buildings whether commercial or residential: The Case of Kenya Revenue Authority v. David Mwangi Ndegwa (Civil Appeal No. 65 of 2019)

Background

The Kenya Revenue Authority has secured a major victory in court after Appeal judges reversed a High Court’s declaration that Value Added Tax (VAT) is not payable on transactions for the sale or purchase of land and buildings whether commercial or residential.

The appeals court on Friday said there was no ambiguity in tax laws and that supply of commercial premises is not exempted from VAT.

In the precedent-setting verdict, the judges also set aside a High Court’s order to Kenya Revenue Authority (KRA) to refund a property buyer, Mr David Ndegwa, Sh11.2 million paid as VAT taxes.

Mr Ndegwa was compelled by KRA to pay the amount after purchasing land in Kiambu town together with the building erected on it.

Upon purchasing the property from Standard Chartered Bank Kenya Ltd in 2013 at a cost of Sh70 million, the taxman demanded a sum of Sh11.2 million on account of Value Added Tax (VAT) at the rate of 16 per cent of the purchase price.

This triggered the legal dispute, where Mr Ndegwa won at the High Court in the judgement delivered in November 2018.

Brief Facts

The case stemmed from a 2013 transaction where David Ndegwa purchased a commercial property from Standard Chartered Bank for Kshs 70 million and VAT of Kes 11 million was charged, which Ndegwa paid under protest. He then applied for refund and sued KRA, arguing that Paragraph 8 of Part II of the First Schedule to the VAT Act exempted the sale of land, including buildings on it, whether residential or commercial, from VAT.

The High Court (Kasango, J.), in its judgment delivered in 2018 held that the the term 'land' as used in the provision and defined in the Constitution includes 'what is on the surface of the earth and the airspace above the surface' including property on the land, whether commercial or residential. The HC ruled in favor of Ndegwa that VAT is not applicable on the sale of commercial property and was entitled to a refund of the VAT paid.

The KRA obtained a stay of execution and appealed the decision to the Court of Appeal, which is the subject of this judgment. The KRA asserted that the exemption applied only to land (vacant land) and residential premises, not commercial premises.

The CoA, in a unanimous decision, overturned the High Court decision, holding that Paragraph 8 of Part II of the First Schedule to the VAT Act does not exempt supply by way of sale, renting, leasing, hiring, letting of commercial premises from VAT.

 Analysis:

 At the Court of Appeal, the main issues the court considered were whether the term "land" in the VAT Act includes buildings, and if so, whether VAT should be charged on the sale of land with buildings (residential or commercial), the implications of the specific mention of "residential premises" in the VAT Act and the exclusion of "commercial premises’’.

The court focused on interpretation of Paragraph 8 of Part II of the First Schedule to the VAT Act, which exempts from VAT the 'supply by way of sale, renting, leasing, hiring, letting of land or residential premises.' The provision defines 'residential premises' as 'land or a building occupied or capable of being occupied as a residence', excluding hotels or holiday accommodations. The court's reasoning was as follows:

1. Distinct terms: The use of 'land' and 'residential premises' as separate categories in the provision indicates that they are not synonymous. The legislature deliberately listed them distinctly, suggesting different scopes of exemption.

2. Clarity of language: The provision’s separation of 'land' and 'residential premises', with a specific definition for the latter, left no room for confusion. 'Land' meant vacant land, and 'residential premises' meant buildings used as residences. Commercial premises fell outside both.

3. Exclusion of commercial premises: By expressly mentioning 'residential premises' and defining it, while omitting 'commercial premises,' the court applied the maxim expressio unius est exclusio alterius (the express mention of one thing excludes others). This implied that commercial premises were not exempt and thus subject to VAT.

4. Legislative intent: The court emphasized that the VAT Act, as an exemption statute, only excludes what is explicitly listed. Since commercial premises were not included, the intention was to tax them.

5. Contextual limitation: Article 260 of the Constitution begins with 'unless the context requires otherwise,' meaning its definition applies only when suitable. The VAT Act’s specific context on tax exemptions allowed a narrower definition of 'land' excluding buildings, unless specified.

6. Statutory autonomy: The court held that the legislature can define terms differently in specific laws (e.g., VAT Act) without adhering strictly to the Constitution’s broad definition. For example, the Mining Act excludes 'minerals' from the definition of 'land'.

The court further referred to the VAT Act’s history (from 2006 onward), noting that earlier versions exempted land, residential, and non-residential buildings, but by 2013, only 'land' and 'residential premises' remained exempt. This evolution showed a deliberate shift to tax commercial premises.

Court's Determination:

The Court of Appeal began by defining land within the context of the VAT Act, 2013 and disagreed with the High Court’s interpretation. The High Court had held that the term “land” included buildings, both residential and commercial, and thus exempted them from VAT. However, the Court of Appeal clarified that the VAT Act’s definition of land must be applied within the context of the Act itself, not the broader definition provided in Article 260 of the Constitution. It rejected the High Court’s interpretation that all buildings on land, whether residential or commercial, are automatically exempt from VAT by virtue of being on land as defined by the Constitution.

The Court of Appeal also examined the VAT exemptions under the VAT Act, emphasizing that the Act is an exemption statute. As such, only supplies explicitly exempted by the Act are free from VAT. The Court reaffirmed that land and residential premises are the only categories that benefit from VAT exemptions under the Act. The exemption does not extend to commercial premises, which are not covered by the exemptions and remain subject to VAT.

In conclusion, the Court of Appeal held that the High Court had erred in its interpretation. It reaffirmed that VAT applies to commercial premises and that the exemptions under the VAT Act are limited to land and residential premises only. The appeal was allowed, and the respondent was not entitled to a VAT refund.

However, the Court did not address the applicability of VAT on mixed-use premises and it was not part of the issues before the court. It left room for future litigation where this specific question could be raised.

Conclusion/jurisprudential Implications

The judgment provides much-needed clarity in Kenya’s tax laws, especially for real estate developers, businesses, and legal practitioners, regarding the VAT treatment of residential versus commercial premises. It is now settled that VAT is applicable on sale, renting, leasing, hiring or letting of commercial premises, subject to an appeal that may be filed at the Supreme Court. Businesses and individuals involved in commercial real estate transactions should now be aware that VAT is chargeable on commercial properties.

Conclusively, the verdict of the Appeals Court brings to end uncertainty in property conveyance sector in relation to VAT levies on property disposals.

INDEFEASIBILITY OF TITLE: The Case of Kenya Church of Christ v Mwasaro & 5 others [2025] KEELC 1317 (KLR)

Brief Facts/Background:

In the case, the Kenya Church of Christ (Plaintiff) filed suit against six defendants in 2014, asserting ownership of Plot No. 3754/VI/MN at Miritini. The Plaintiff claimed to have legally acquired the land through a 2004 sale agreement based on a 1991 letter of allotment issued to Bishop Chrispus Nzano. They alleged the defendants encroached, erected structures, and obstructed access. The Plaintiff sought injunctions, demolition orders, and costs. 

The Defendants countered, asserting ancestral ties to the land through Keya Mbaya, alleging the Plaintiff’s title was fraudulently obtained via forgery by Danson Mwandoto (a former church official). They claimed to have purchased portions from intermediaries (e.g., Mrs. Adriano and Keya Mbaya) and developed permanent structures. Their counterclaim sought cancellation of the Plaintiff’s title, injunctions, and compensation. 

Issues for determination:

Who holds legal/beneficial interest in the suit property? 

Whether the Plaintiff’s title was valid? 

Whether the defendants’ counterclaim merited? 

Analysis

On Who holds legal/beneficial interest in the suit property, the court decided the Plaintiff’s registered title conferred absolute ownership under Section 24 of the Land Registration Act, and that the Defendants failed to prove overriding interests or lawful occupation. 

On Whether the plaintiff’s title is valid,  the court upheld the title’s validity, while noting that the Fraud allegations lacked specificity and proof under Section 109 of the Evidence Act. The Police recommendations were deemed unsubstantiated, as no charges were pursued, and Mwandoto testified openly in court. 

 On Whether the defendants’ counter claim merited, the court dismissed the defendants’ counterclaim since their reliance on ancestral claims and unregistered sales (e.g., via Keya Mbaya) did not override statutory title. As such, no evidence of fraud or legitimate adverse possession. 

Court’s Determination:

The court ruled in favor of the Plaintiff, declaring their title valid. Further, the court ordered, a boundary survey by the Land Registrar to identify encroachments, removal of unauthorized structures within 90 days, with eviction/demolition orders for non-compliance, and permanent injunction against Defendants’ interference. Furthermore, the counterclaim was dismissed.

Conclusion

This judgment reinforces the principle of indefeasibility of registered titles under Kenyan law, emphasizing that registration confers absolute ownership unless fraud is specifically pleaded and proved. It clarifies that mere allegations of historical occupation or unregistered transactions cannot override statutory titles.

The case underscores the judiciary’s role in upholding land registration systems to prevent disputes and promote certainty in property rights.

It also highlights the evidentiary burden for fraud claims, aligning with precedents like Vijay Morjaria v Nansingh Madhusingh Darbar, which demand rigorous proof of fraudulent intent. By dismissing speculative challenges to titles, the decision strengthens confidence in Kenya’s land administration framework.