1.Mathews O. Winam (the appellant) has preferred this appeal against the Judgment and Decree of the High Court of Kenya at Kisii delivered by Okwany J, finding that the court had no jurisdiction to hear and determine the matter.
2.The appellant, (being the plaintiff in Kisii CMCC No. 540 of 2009) filed suit on 9th September, 2009 and subsequently amended on 10th January, 2012 seeking the following reliefs:
3.The appellant’s claim was that by a written agreement dated 4th February, 2002 it was agreed that he would grow sugar cane on his land Plot Number 79 on field number 20A in Kakmasia Sub Location measuring 0.2 ha. which he would then sell to the respondent company. The contract was to be in force for a period of five years or until one plant crop and two ratoon crops of sugarcane were harvested whichever period was less.
4.The appellant further contended that the respondent harvested only one plant crop pursuant to their said contract and later neglected to harvest the subsequent ratoon crop thereby occasioning him loss and damage amounting to Kshs.108,810.
5.The respondent filed a statement of defence wherein he denied the appellant’s claim in its entirety, and on a without prejudice basis, stated that it was the appellant who breached the agreement as he failed to maintain and/or employ the recommended crop husbandry technique resulting in cane that was destroyed and dwarfed by weeds; and the respondent could not be expected to harvest cane that was not there in the first place.
6.Further, that the appellant’s claim was for special damages which had not been specifically pleaded and in any event, the trial court lacked jurisdiction to entertain the suit on the basis that the Sugar Act had created a special tribunal to handle such disputes.
7.In his testimony before the magistrate’s court, the appellant repeated what we have summarized of the claim.
8.The respondent’s witness, Richard Muok who is the respondent’s field supervisor, told the trial court that the appellant abandoned the 1st ratoon and had nothing to harvest, thereby being in breach of the contract. He however admitted on cross examination that he had no document or report to prove that the appellant abandoned the 1st ratoon thereby causing the death of the 2nd ratoon. The witness further conceded that the respondent did not notify the appellant to make good the abandonment of the 1st ratoon crop. It was argued in evidence that the 0.2 ha portion of contracted sugar cane could not produce 135 tonnes from the plant crop.
9.The trial court considered the case by both parties and dismissed the appellant’s claim on grounds that the court’s jurisdiction had been ousted by creation of the special Sugar Arbitration Tribunal which was vested with jurisdiction to hear and determine disputes between parties.
10.Aggrieved by the decision of the trial court, the appellant, filed his Memorandum of Appeal before the High Court challenging the judgment of the lower court on grounds that having had a contractual relationship with the respondent, he had invoked common law available in civil courts so as to get a remedy by way of compensation; that the jurisdiction of the civil court was never repealed either expressly; and that Section 29 of the Sugar Act precluded him from being an ‘interested party’ under the Act. He urged that the appeal be allowed and the judgment set aside; the suit be remitted to the trial court with an order that the court do assess the damages payable; and that the costs of the appeal be awarded to the appellant.
11.In opposing the appeal at the High Court, the respondent maintained that once a tribunal vested with jurisdiction to hear and determine disputes between parties had been established, then the court lacked jurisdiction to handle the matter.In canvassing the appeal before the High Court, parties filed written submissions.
12.The High Court considered the proceedings and judgment in the trial court, the Memorandum of Appeal and the written submissions by both parties and narrowed the issues for determination as: whether the trial court had jurisdiction to hear and determine the suit, whether the appellant’s suit was time barred and whether the special damages were pleaded.
13.On the issue of jurisdiction, the High Court was of the view that the intention of the Legislature in creating the Sugar Arbitration Tribunal was to provide the first port of call for parties with disputes arising in the sugar industry, removing such disputes from the mainstream courts of law. The court also pointed out that Article 165 (3) (c) of the Constitution grants the High Court jurisdiction to hear an appeal from a decision of a tribunal.
14.The learned Judge stated that Section 31 of the Sugar Act established a specific tribunal with the sole purpose of arbitrating disputes arising under the Act. The Judge was of the opinion that the dispute between the parties relating to the sugar growing contract fell within the purview of the Sugar Act.
15.Being aggrieved by the High Court’s finding, the appellant filed this second appeal on grounds that the High Court erred in holding that the Magistrate’s Court’s jurisdiction was ousted by the Sugar Act 2001 as there was no express ouster or repealing legislation to that effect, the judge is faulted for failing to find that the contract sought to be enforced was not subject to the Sugar Act 2001, and which Act did not apply retrospectively to the contract in question, the appellant was not an “Interested Party” as defined under the Sugar Act 2001, the Sugar Arbitration Tribunal did not have the power to award compensation, and that the powers expressed under section 32 of the Sugar (Arbitration Tribunal) Rules 2008 were ultra vires the Sugar Act 2001. The appellant therefore prays that the appeal be allowed, the judgment dated 10th April 2017 be set aside, and this court assess and awards damages as appropriate. It is also prayed that the costs of this appeal, the appeal in the High Court, and of the suit be awarded to the appellant.
17.The appellant contends that the High Court erred in finding that the Magistrate Court’s jurisdiction was ousted by the Sugar Act 2001 in the absence of an express ouster or repealing legislation and failing to find that the contract to be enforced was not subject to the Sugar Act, 2001.
18.He further contends that the claim did not arise under the Sugar Act as the contract was made on 11th February, 2002 whereas the Act came into force on 1st April, 2002, and as such the Act could not apply retrospectively.
21.Further, that Section 29 of the Sugar Act precludes him, an out grower, from being referred to as an ‘interested party’ under the Act, that Sub-section 2 of the Act does not cover an out grower rather an out-grower institution by definition. The appellant also submits that the learned Judge failed to address her mind to grounds of the appeal which touched on limitation, special damage vis a vis general damages, and sufficiency if pleaded and breach of the contract by the respondent.
22.On the issue of limitation, the appellant argues that the respondent in its defence never pleaded limitation of time, and that the trial court therefore had no jurisdiction to determine the issue of limitation. He relied on Order 2 Rule 4 of the Civil Procedure Rules which provides:
23.It is the appellant’s contention that limitation cannot apply in any event, as the contract is dated 4.02.02 and the suit was filed on 9.9.02. That the limitation period for contract is 6 years, and the appellant was clearly within the window as time would have lapsed on 4.02.2011.
24.As regards special damages for breach of contract the appellant contends that the same was specifically pleaded in the amended plaint dated 10th January, 2012 and proved by the productivity report of expected yields. He further points out that the respondent admitted in cross-examination that it did not make a report on the appellant’s abandoned crops, and further that it was an obligation to issue a notification to the appellant to make good on the contracted cane crop, which was not done. This, in the appellant’s view, shows that there was no breach of contract.The Appellant therefore prays that the appeal be allowed.
25.The respondent’s counter that this having been a matter that fell squarely within the ambit of Section 31 of the then Sugar Act (now repealed), it was required that the appellant's first port of call be the said tribunal before proceeding to court. That in the instant case, when the appellant filed this matter in 2007, there existed a tribunal in place specifically tasked with the duty of handling disputes between millers, growers and out-growers. The respondent cites the decision in Albert Chaurembo Mumba & Others v Maureen Munvao &148 others (2019) eKLR which held inter alia that:
27.On the issue of jurisdiction, it is the appellant’s contention that the trial court had the jurisdiction to hear and determine his suit, and the same was not under the purview of the Sugar Act and the Sugar Arbitration Tribunal. In support of this argument, the appellant draws from this Court’s decision in Jeremiah Otieno Madara vs Sukari Industries Limited, Civil Appeal No. 257 of 2019 which held:
28.Both the trial court and the High Court correctly noted that the Sugar Act 2001 which created and established the Sugar Arbitration Tribunal was in force at the time that the suit was filed, and the Tribunal would be the first port of call in determining disputes arising in the sugar industry, thereby removing such disputes from the main stream courts.
31.The parties entered into a contract in the year 2002, and according to the appellant’s pleadings, the first crop was to be harvested after 22-24 months after planting, and the subsequent harvest ought to have been made within 16-18 months of the harvest. The parties were unanimous in their evidence that this harvest was done in the year 2004. However, the first ratoon was not harvested and ended up drying in the farm, subsequently, this, suit was filed in the year 2009. This then means that within the subsequent period when the breach allegedly occurred, the Sugar Tribunal was in existence and should have been the first port of call.
32.We hold that the High Court, on first appeal, rightly found that the trial court had no jurisdiction in the matter before it as the complaint should have been taken to the tribunal established and contemplated under section 31 (1) (2) of the Sugar Act. Indeed, where there is a specific mechanism established for resolution of disputes, a party has no right to side-step that dispute resolution mechanism at all. The courts will only have jurisdiction after that mechanism has been exhausted. As jurisdiction is everything (Owners of the Motor Vessel “Lillian S” v Caltex Oil (Kenya) Limited (supra) the trial court should have downed tools and refused to entertain the appellants claim. In this case, the moment the Sugar Tribunal was established, the disputants should have presented their contest there first. The ruling in the Njenga Karume case (supra) is relevant to the instant case, and we find that the High Court did not err in upholding the trial court’s judgment that it did not have jurisdiction.
33.Having found that the court properly held that it had no jurisdiction to determine the dispute (and therefore dispositive of the appeal), then it would be superfluous for us to engage in analysing and determining whether the appellant’s suit was statute barred, or whether the special damages were specifically pleaded and proved.Consequently, we hold that the appeal lacks merit, and is dismissed with costs to the respondent
DATED AND DELIVERED AT MOMBASA THIS 19TH DAY OF NOVEMBER, 2021.S. ole KANTAI.....................................JUDGE OF APPEALH. A. OMONDI...................................JUDGE OF APPEALMUMBI NGUGI...................................JUDGE OF APPEALI certify that this is a true copy of the originalDEPUTY REGISTRAR