On distinguishing between fixed-term and indefinite employment contracts in redundancy and termination cases, and the necessity for employers to adhere to the provisions of the Employment Act and any applicable CBAs when conducting redundancies: The case of Kenya Engineering Workers Union v Kenya General Industries Limited [2025] KEELRC 1496 (KLR)

Court: Employment and Labour Relations Court at Mombasa
Judge: Justice K. Ocharo
Date: 22 May 2025
Case Number: Cause E074 of 2022
Outcome: Claim dismissed

Background:
The Kenya Engineering Workers Union (Claimant) filed a suit on behalf of several grievants, alleging unfair termination of employment by Kenya General Industries Limited (Respondent). The Claimant maintained that a recognition agreement and a negotiated Corrective Bargaining Agreement (CBA) were in place at all relevant times. The Respondent countered that the grievants were employed under individual fixed-term contracts, each of which expired without renewal, and thus their employment was not unfairly terminated.

Key Issues:

• Whether the grievants were employed under fixed-term contracts or indefinite contracts.
• Whether the Respondent complied with the provisions of Section 40 of the Employment Act and the terms of the CBA in the alleged redundancy process.

Court's Findings:
The Court found that the grievants were employed under individual fixed-term contracts that expired at different intervals. As such, their employment was not terminated unfairly but rather ended upon the expiration of their respective contracts. Consequently, the Court held that the Claimant's case lacked merit and dismissed the suit.

Legal Implications:
This judgment underscores the importance of distinguishing between fixed-term and indefinite employment contracts in redundancy and termination cases. It also highlights the necessity for employers to adhere to the provisions of the Employment Act and any applicable CBAs when conducting redundancies.

For further details, you can access the full judgment Here

 

Case Analysis on following legal procedures in tenancy disputes: The Case of Orchards Communications Limited v Suitable Hotels Limited (Tribunal Case E247 of 2023) [2024] KEBPRT 524 (KLR) (21 March 2024)

Case Overview

In this ruling, the Business Premises Rent Tribunal (BPRT) addressed an application by Suitable Hotels Limited (the "Landlord") seeking orders for the attachment of Orchards Communications Limited's (the "Tenant") property due to unpaid rent arrears amounting to Kshs. 3,561,037. The Landlord also sought eviction of the Tenant following the attachment.

Tribunal's Findings

1. Non-Compliance with Statutory Termination Procedures

The Tribunal emphasized that under Section 4(2) of the Landlord and Tenant (Shops, Hotels, and Catering Establishments) Act (Cap 301), a landlord wishing to terminate a controlled tenancy must issue a termination notice in the prescribed form. The Landlord failed to demonstrate compliance with this requirement, rendering the eviction application premature and legally untenable.

2. Rent Arrears and Payment Plan

The Tribunal acknowledged the Tenant's outstanding rent arrears of Kshs. 1,135,016.98. Considering the Tenant's financial situation, the Tribunal ordered that the arrears be cleared in three equal monthly installments, commencing in April 2024. Failure to adhere to this payment plan would grant the Landlord the liberty to levy distress for rent using a licensed auctioneer.

3. Costs of the Application

The Tribunal directed that the Tenant bear the costs of the application, reinforcing the principle that parties failing to meet their financial obligations may be held responsible for associated legal costs.

 

Legal Implications

• Statutory Compliance: The ruling underscores the necessity for landlords to adhere to statutory procedures when seeking to terminate a controlled tenancy.
• Payment Arrangements: The Tribunal's decision to allow a structured payment plan reflects a balanced approach, considering both the Tenant's obligations and financial capacity.
• Cost Allocation: The imposition of costs on the Tenant serves as a deterrent against non-payment and encourages adherence to legal obligations.

Conclusion

The Tribunal's ruling in this case highlights the importance of following legal procedures in tenancy disputes. While landlords are entitled to seek remedies for unpaid rent, they must ensure compliance with statutory requirements to avoid invalidation of their claims. Similarly, tenants are reminded of their obligations to meet rental payments promptly to avoid legal consequences.

 

Whether the Small Claims Court has jurisdiction to hear and determine a declaratory suit arising from an insurance policy: The Case of Jubilee Allianz General Insurance Kenya Limited v Benson Muhavi Butiya

Court: High Court of Kenya at Nairobi (Milimani Law Courts)
Case Number: Civil Appeal E613 of 2024
Judgment Date: 24 April 2025
Judge: Hon. J.N. Njagi

Parties:

• Appellant: Jubilee Allianz General Insurance Kenya Limited
• Respondent: Benson Muhavi Butiya

Background:
Benson Muhavi Butiya (the Respondent) filed a declaratory suit against Jubilee Allianz General Insurance Kenya Limited (the Appellant) in the Small Claims Court. The suit concerned a claim under an insurance policy issued by the Appellant. The Appellant challenged the jurisdiction of the Small Claims Court, arguing that it lacked the authority to determine a declaratory suit, particularly one related to insurance matters.

The appellant, Jubilee Allianz General Insurance Kenya Limited, appealed against a decision by the Small Claims Court in Milimani Civil Suit No. E741 of 2024. The suit involved a declaratory action concerning the jurisdiction of the Small Claims Court over a matter related to an insurance policy.

Issues:
The central issue in this appeal was whether the Small Claims Court had the jurisdiction to hear and determine a declaratory suit concerning an insurance policy/ Whether the Small Claims Court had jurisdiction to hear and determine a declaratory suit involving an insurance contract.

Court’s Determination:
The High Court, presided over by Hon. J.N. Njagi, dismissed the appeal. The court upheld the decision of the Small Claims Court, affirming its jurisdiction to entertain the declaratory suit.

The High Court dismissed the appeal, holding that the Small Claims Court had the requisite jurisdiction to hear the declaratory suit. The Court upheld the lower court’s decision and allowed the matter to proceed before the Small Claims Court.

Legal Significance:
This judgment reinforces the jurisdictional boundaries of the Small Claims Court in Kenya, particularly concerning declaratory actions related to insurance policies.

Rationale

• The court interpreted the Small Claims Court Act and applicable statutes, finding no limitation excluding declaratory actions from its jurisdiction.
• The court emphasized that access to justice and timely resolution of commercial disputes is essential, particularly where the claim value falls within the statutory threshold.

Citation:
Jubilee Allianz General Insurance Kenya Limited v Butiya [2025] KEHC 5170 (KLR) (Civ)

For a comprehensive understanding of the case, you can access the full judgment here: https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/5170/eng@2025-04-24

Jurisdiction of Small Claims Court on refund of security deposits : The Case of Muhanda v LP Holdings Ltd (Civil Appeal E256 of 2023) [2025}

The landmark decision by the High Court in Muhanda v LP Holdings Ltd (Civil Appeal E256 of 2023) [2025] KEHC 393 (KLR) (Commercial and Tax) (23 January 2025) has now clarified that the Small Claims Court has jurisdiction over such claims.

In the case, the High Court determined that refund of security deposits falls within the category of “a contract for money held and received” under Section 12(b) of the Small Claims Act (No. 2 of 2016). The judgment also noted that the matter had initially been declined by the Small Claims Court on jurisdictional grounds. However, Justice Helene R.  Namisi, after finding that the Small Claims Court has jurisdiction, referred the matter back to the SCC to be heard and determined on its merits by a different adjudicator.

 

On the inheritance rights of children informally adopted by a deceased person: The case of Willingstone Muchigi Kimari v. Rahab Wanjiru Mugo

The case of Willingstone Muchigi Kimari v. Rahab Wanjiru Mugo, Nairobi Court of Appeal Civil Appeal No. 168 of 1990, is a significant decision in Kenyan succession law, particularly concerning the inheritance rights of children informally adopted by a deceased person.(Knowledge Tree Law Notes)

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📌 Case Overview

• Court: Court of Appeal of Kenya
• Citation: Civil Appeal No. 168 of 1990
• Judges: Gachuhi, Muli, and Akiwumi JJA
• Date: 1990(Knowledge Tree Law Notes)

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⚖️ Legal Issue

The central issue was whether a child informally adopted by a deceased person is considered a "child" under Section 3(2) of the Law of Succession Act, Cap 160, and thus entitled to inherit from the deceased's estate.

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🧾 Court's Findings

The Court of Appeal held that:

• Section 3(2) Interpretation: The definition of a "child" under this section applies exclusively to children whom a male deceased person had accepted or assumed permanent responsibility over.
• Informal Adoption: A child informally adopted by a female deceased person does not qualify as a "child" for the purposes of inheritance under the Law of Succession Act.(Knowledge Tree Law Notes)

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📚 Legal Implications

This ruling underscores the statutory distinction between children formally recognized by male deceased persons and those informally adopted by female deceased persons in the context of inheritance rights.(Knowledge Tree Law Notes)

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🧭 Conclusion

The decision in Willingstone Muchigi Kimari v. Rahab Wanjiru Mugo clarifies that, under Kenyan law, only children whom a male deceased person has formally recognized or assumed permanent responsibility for are entitled to inherit from his estate. This case highlights the importance of formal recognition in determining inheritance rights.

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On adhering to the procedural requirements set when terminating an employee's contracts or suspension: The case of Kenya Chemical Workers Union v Silafrica Limited [2025] KEELRC 1205

 Brief facts/Background:

On suspension, in the case, the Claimant’s position was that the Respondent's actions in suspending the Grievant without first issuing a show-cause letter were in direct contravention of the procedural requirements outlined in the Employment Act. 

The Claimant filed a Memorandum of Claim on December 10, 2020, seeking reinstatement or, alternatively, compensation for a grievant employed by the Respondent. The grievant, James Kirubi Mwangi, was employed as a machine attendant on February 2, 2002, and his contract was terminated on November 16, 2018, allegedly due to involvement in an illegal strike.

Issues for Determination:

•     Fairness of Termination:

Whether the termination of the grievant's employment was fair under the provisions of the Employment Act.

•     Entitlement to Benefits:

Whether the grievant is entitled to the benefits claimed, including notice pay, leave days, gratuity, and compensation for loss of employment.

Analysis :

The court observed that a suspension is generally an administrative measure and does not imply that there has been a finding of any misbehaviour or breach of rules by the suspended employee, but merely that an allegation of some impropriety or misconduct has been made against the employee in question.

Court’s Findings

•     Fairness of Termination:

The court found that the Respondent failed to follow the mandatory procedures for termination as outlined in sections 41, 43, and 45 of the Employment Act. The grievant was not afforded an opportunity to defend himself, and the Respondent did not provide sufficient evidence to justify the dismissal.

•     Entitlement to Benefits:

    The court determined that the grievant was entitled to the following benefits:

• Two months' notice pay
•  Days worked
•  Leave travel allowance
•  29 annual leave days
•  Pro-rata leave
•  Gratuity/service pay for 14 years
•  Three months' compensation for loss of employment
•  Ex-gratia payment as per the Collective Bargaining Agreement (CBA)

The total amount awarded was Kshs. 922,687.

Court's holding:

The court held that hearing the employee at the point of issuance of a suspension letter is not mandatory. The suspension of the Grievant without a hearing did not, thus in itself, render the termination unfair, as no such hearing was envisaged at that stage.

Legal Significance

This judgment underscores the importance of adhering to the procedural requirements set out in the Employment Act when terminating an employee's contract. It also highlights the enforceability of benefits stipulated in a Collective Bargaining Agreement and the court's role in ensuring that employees receive fair treatment and compensation upon unlawful termination.

Read the full case at here

Section 30 of the Kenyan Small Claims Court Act

Section 30 of the Kenyan Small Claims Court Act allows parties to proceed with their cases by submitting written submissions instead of oral testimony, as long as all parties agree. This means the court can decide the case based on the documents and statements presented. 

Key points about Section 30:

• Written Submissions:

Parties can choose to have their cases decided based on written submissions, eliminating the need for witnesses to testify in court.

• Agreement of Parties:

This process requires the agreement of all parties involved in the proceedings.

• Court's Decision:

The court can then make a decision based on the documents and statements provided.