Weekly Newsletter 016/2018

Weekly Newsletter 016/2018



Kenya Law

Weekly Newsletter


It is not Compulsory for Liquidation of a Company to be an option of Last Resort where a Company Failed to Pay its Debts
Prideinn Hotels & Investments Limited v Tropicana Hotels Limited [2018] eKLR
Civil Appeal No. 98 of 2017
Court of Appeal at Mombasa
A. Visram, M.Koome & W. Karanja, JJA
March 22, 2018.
Reported by Kakai Toili
Download the Decision

 

Civil Practice and Procedure – appeals – appeals from the High Court to the Court of Appeal – procedure - what was the procedure to be followed when appealing against a decision of the High Court to the Court of Appeal - Court of Appeal Rules, rule 75 (1) & (2)

Land Lawlessor and lesee relationship – where a lesee owed a lessor money – where the lesee failed to pay the lessor money owed – in duplum rule – applicability of the in duplum rule - whether the in duplum rule applied to a lessee who owed money to a lessor

Insolvency Law creditors – where a company owed a creditor – where the creditor failed to pay the debt – options available to a creditor - liquidation -whether liquidation of a company was to be an option of last resort which a creditor could pursue to secure payment of a debt

Company Law companies – winding up of companies – mandatory winding up by a court order – where a company was alleged to be unable to pay its debts - whether winding up of a company was to be an option of last resort where a creditor sought the winding up of a company by a court order

Words and Phrases file – definition of file - to deliver a legal document to the court clerk or record custodian for placement into the official record, also termed lodge

 

Brief Facts:

By a lease agreement between the Respondent, the Appellant and the Respondent’s Guarantors, the Respondent leased out the suit premises to the Appellant. The parties later on entered into an agreement to carry out renovations and other works on the suit premises. The Respondent was to carry out the renovations and other works and would be reimbursed by the Appellant with interest for over a 5 year period.
The parties entered into a surrender of the lease agreement. However, neither the Appellant nor its Guarantors honoured the terms of the surrender of the lease. The Appellant and its Guarantors made a payment proposal and undertaking which was accepted by the Respondent. The Appellant paid the agreed amount save for the principal renovation amount and interest thereon. The Appellant drew monthly posted cheques beginning May, 2012. However, the cheque in respect of the month of July, 2012 upon presentation was dishonoured.
The Appellant did not make any further payments and subsequently the Respondent served the Appellant with a notice demanding payment of the amount which stood at Kshs.69, 353,908.20. After the lapse of 21 days from the date of service of the notice, the Respondent filed a petition in the Trial Court seeking the winding up of the Appellant. The Trial Court issued orders that the Appellant had shown inability to pay the debt owed to the Respondent and placed it into liquidation among other orders. Aggrieved by that decision the Appellant filed the instant Appeal. The Respondent also filed an application for the striking out of the Notice of Appeal and the Record of Appeal for allegedly being filed out of time. The Notice of Appeal bore the Trial Court stamp indicating that it was filed on September 25, 2017 and an endorsement by the Deputy Registrar that it was lodged in the same court on November 21, 2017.

 

Issues:

  1. Whether liquidation of a company was to be an option of last resort which a creditor could pursue to secure payment of a debt.
  2. What was the procedure to be followed when appealing against a decision of the High Court to the Court of Appeal
  3. Whether the in duplum rule applied to a lessee who owed money to a lessor.

Relevant Provisions of the Law:
Insolvency Act
Section 384

(1) For the purposes of this Part, a company is unable to pay its debts—

(a) if a creditor (by assignment or otherwise) to whom the company is indebted for hundred thousand shillings or more has served on the company, by leaving it at the company’s registered office, a written demand requiring the company to pay the debt and the company has for twenty-one days afterwards failed to pay the debt or to secure or compound for it to the reasonable satisfaction of the creditor;

Held:

  1. Under rule 75 (1) of Court of Appeal Rules (the Rules), any person who desired to appeal to the Court had to give a notice in writing which had to be lodged in duplicate with the Deputy Registrar of the High Court. Rule 75 (2) of the Rules stipulated that the notice had to be lodged within 14 days of the date of the decision against which it was desired to appeal. There was no distinction between filing and lodging a document in court, those words meant one and the same thing. 
  2. The Appellant presented the Notice of Appeal at the High Court registry, paid the requisite fees and a stamp was affixed on the face of it signifying its receipt. The Notice of Appeal was lodged/filed on the date reflected by the High Court stamp. Taking into account that the impugned decision was delivered on September 22, 2017 the Notice of Appeal, which was filed on September 25, 2017, was filed within time.
  3. The purpose of the Deputy Registrar endorsing a Notice was to indicate the date it was lodged in the Trial Court. As to why the Deputy Registrar, in the instant case, signed the Notice of Appeal in question on November 21, 2017 as opposed to the date it was filed was a question which could only be answered by the said Deputy Registrar. The Appellant could not be held responsible for the Deputy Registrar’s late action. The Appeal before the Court was competent.
  4. The Court’s mandate under rule 29(1)(a) of the Rules as the first Appellate Court was to re-appraise the evidence and draw its own inferences of fact. The decision of the Trial Court was entitled to some measure of deference unless the conclusions made on the evidential material on record were perverse or the decision as a whole was bad in law. The Petition was properly before the Court. The Ruling dated July 9, 2017 was not subject of the appeal before the Court.
  5.  From the facts of the case it was without doubt that the parties entered into several agreements which regulated their relationship and obligations thereunder. The appeal turned to a substantial extent on the construction of those agreements.  There was no element of coercion against the Appellant. Apart from alleging that it was coerced by the directors of the Respondent. The Appellant did not adduce any evidence to show coercion in entering into the lease agreement. With respect to misrepresentation, the Deed of variation was crystal clear on the Appellant’s willingness to continue with the lease even after the earlier lease in favour of Caracas was terminated hence it could not rely on the same to vitiate the lease.
  6. The object of construction of terms of a contract was to ascertain its meaning or in other words the common intention of the parties thereto. Such construction had to be objective, the question was not what one or the other parties meant or understood by the words used, rather what a reasonable person in the position of the parties would have understood the words to mean.
  7. There was no evidence that the parties concluded an oral agreement. Accordingly, it could not be a basis of varying the terms of the payment proposal. In light of the circumstances of the case and more so, the fact that the Appellant had not met its obligations under the surrender of lease and payment proposal, the Respondent’s aforementioned obligations thereunder had not arisen. Under clause 8 of the Surrender of Lease, the Appellant was entitled to refund of the deposit only after paying Kshs.25,000,000 for the renovation and the interest thereunder. Similarly, under clause 9, the Respondent was to reimburse the Appellant the sum of Kshs.25,000,000 after 7 years and 6 months of payment of the same or after the sale of the suit premises whichever came earlier. The Respondent did not owe the appellant any money.
  8.  There was no bonafide dispute on the Appellant’s indebtedness. As to the extent of its indebtedness, the amount which stood at Kshs.44,910,724 on April 4, 2012 when the payment proposal was made, had escalated to Kshs.69.353.908 on account of accrued interest. The in duplum rule was not applicable, the said rule was only applicable in cases of loans or financial facilities offered by financial institutions as defined under the Banking Act. 
  9. The Appellant did not make any payments after being served with a notice of demand by the Respondent hence the Respondent was entitled to bring a petition for liquidation of the Appellant on the ground of its inability to pay its debt. There was no requirement under the Insolvency Act or the Companies Act which stipulated that liquidation of a company should be as a last resort. Liquidation was one of the options under the Insolvency Act which a creditor such as the Respondent in the case, could pursue to secure payment of a debt, especially a debt that remained unpaid for several years and in respect of which the Appellant had been given adequate time, opportunity and indulgence.

Appeal dismissed with costs

  1. Order of liquidation of the Appellant suspended for a period of 30 days to enable the appellant to make full payment of all the moneys due failing which the orders of the Court would stand final.

Per  W.Karanja, JA(Dissenting)

  1. Before an aggrieved creditor could file a winding up petition against a company or before the Court could give orders of winding up of a company, there had to be evidence that all other efforts to recover the debt had failed to yield the desired result. The Court that was called upon to make a winding up order should establish if there existed an alternative remedy to the creditor that was less draconian than a winding up order that was because winding up had to be the last resort.
  2. If the winding up order was sought because the company had been unable or reluctant to pay a debt, the Court had to consider if alternative remedies existed which could at the end yield the same result. In the instant case the debt was admitted. Even if the debt was disputed the Respondent would file a suit for summary judgment in an ordinary civil suit, that remedy would be just as fast and expedient as a winding up order.
  3.  There had to be other ways for the Respondent to recover its debt than by way of liquidation of the Appellant which was still on its feet, perhaps limping, but definitely still on its feet. The Respondent was using the winding up avenue to put pressure on the Appellant to settle the debt in question, that was the wrong route.
  4. The Appellant owed other people or institutions money and was servicing its debts with the banks. The Appellant was not insolvent to an extent that the only cure available for it was a quick dispatch to the netherworld. An order winding up the company was not the best remedy in the circumstances of this suit.

 Appeal would have been allowed with no orders as to costs

Kenya Law
Case Updates Issue 021/2018
Case Summaries

CONSTITUTIONAL LAW A County Government cannot Sue to Enforce the Rights Contained in the Bill of Rights

Meru County Government v Ethics & Anti-Corruption Commission [2018] eKLR
Civil Appeal No. 193 of 2014
Court of Appeal at Nairobi
P. N. Waki, R. N. Nambuye & P. O. Kiage, JJA
March 16, 2018.
Reported by Kakai Toili

Download the Decision

Constitutional Law – Bill of Rights – enforcement of Bill of Rights – persons who could enforce rights in the Bill of Rights – county governments - whether a county government could sue and enforce rights in the Bill of Rights – Constitution of Kenya, 2010, articles 19 (2) & (3), 22 & 260
Constitutional Law – Bill of Rights – enforcement of Bill of Rights – persons who could enforce rights in the Bill of Rights - who could institute a suit for enforcement of Bill of Rights - Constitution of Kenya, 2010, articles 19 (2) & (3), 22 & 260
Jurisdiction – jurisdiction of the Court of Appeal – interference of decisions by the High Court - what were the circumstances in which the Court of Appeal would interfere with the decision of a High Court

Brief Facts:
Between March 20, 2017 and April 15, 2017 pursuant to a search warrant issued by the Chief Magistrate to the Respondent, the Respondent accompanied by police officers entered the offices of the Appellant ’s Officers and took possession of and carted away all documents from the Appellant’s Procurement Department without the Appellant’s officers being allowed an opportunity to make copies of the said documents.
Aggrieved by the Respondents actions, the Appellant filed a Petition in the Trial Court claiming that the Respondent through its officers had violated various rights and fundamental freedoms of the Appellant's officers and the Constitution. The Trial Court dismissed the Appellant’s Petition and held that the Appellant was not a person who could petition the Trial Court for violation of its fundamental rights and freedoms under article 22 of the Constitution by another State organ. Aggrieved by the dismissal, the Appellant filed the instant Appeal.

Issue:

  1. Whether a county government could enforce rights in the Bill of Rights.
  2. What were the circumstances in which an Appellate Court would interfere with the decision of a High Court.Read More...

Relevant Provisions of the Law:
Constitution of Kenya, 2010
Article 19 - Rights and fundamental freedoms.
(2) The purpose of recognising and protecting human rights and fundamental freedoms is to preserve the dignity of individuals and communities and to promote social justice and the realisation of the potential of all human beings.
(3) The rights and fundamental freedoms in the Bill of Rights—

(a)belong to each individual and are not granted by the State;
(b)do not exclude other rights and fundamental freedoms not in the Bill of Rights, but recognised or conferred by law, except to the extent that they are inconsistent with this Chapter; and
(c)are subject only to the limitations contemplated in this Constitution.

Article 22 - Enforcement of Bill of Rights.
(1) Every person has the right to institute court proceedings claiming that a right or fundamental freedom in the Bill of Rights has been denied, violated or infringed, or is threatened.
(2) In addition to a person acting in their own interest, court proceedings under clause (1) may be instituted by—

(a)a person acting on behalf of another person who cannot act in their own name;
(b)a person acting as a member of, or in the interest of, a group or class of persons;
(c)a person acting in the public interest; or
(d)an association acting in the interest of one or more of its members.

(3) The Chief Justice shall make rules providing for the court proceedings referred to in this Article, which shall satisfy the criteria that—

(a)the rights of standing provided for in clause (2) are fully facilitated;
(b)formalities relating to the proceedings, including commencement of the proceedings, are kept to the minimum, and in particular that the court shall, if necessary, entertain proceedings on the basis of informal documentation;
(c)no fee may be charged for commencing the proceedings;
(d)the court, while observing the rules of natural justice, shall not be unreasonably restricted by procedural technicalities; and
(e)an organisation or individual with particular expertise may, with the leave of the court, appear as a friend of the court.

(4) The absence of rules contemplated in clause (3) does not limit the right of any person to commence court proceedings under this Article, and to have the matter heard and determined by a court.

Article 260 - Interpretation.
In this Constitution, unless the context requires otherwise—

“person” includes a company, association or other body of persons
whether incorporated or unincorporated;

Held:

  1. The definition of a person contained in the interpretative article 260 of the Constitution included a company, association or other body of persons whether incorporated or unincorporated.
  2. That County Government was a legal person and therefore capable of the various powers and functions prescribed by law. As far as legal capacity was concerned in the sense of being capable of holding property and of suing and being sued, the county governments were as much persons in a loose sense as the National Government which had like capacities. That had been recognized in statute law including by the Government Proceedings Act.
  3. The Court was free to depart from the findings and conclusions of the Trial Court when the same were unsustainable from the material on record, were plainly and had resulted in misjustice. Indeed the Court’s latitude to depart was wider where, as in the instant case, the matter in the Trial Court proceeded by way of affidavit evidence and Counsel’s submissions thereon, as opposed to by way of viva voce evidence. Had the Court proceeded by way of viva voce evidence the Court would have been at a decided advantage of having heard and seen the witnesses for which due allowance had to be made. In the instant case what was invoked was the Trial Court’s discretion and the Court would be slow to interfere with it unless the Court was a satisfied that the Trial Court misdirected itself in some matter and as a result arrived at a wrong decision or unless it was manifest from the case as a whole that the Trial Court was clearly wrong in the exercise of its discretion and that as a result there has been misjustice.
  4. It would have been axiomatic that if by reason only of having capacity to sue a county government would also be in a position to sue and enforce rights in the Bill of Rights, then by parity of reasoning, the National Government and indeed the State would be equally entitled to do so. Article 260 of the Constitution precedeed the various meanings to be attached to a selection of term with the words in the Constitution, unless the context required otherwise.
  5. The Constitution recognized that depending on context, the interpretation of terms provided could differ in meaning or be limited in application. When it came to the Bill of Rights, the context had to dictate that the rights and fundamental freedoms could not possibly attach to a county government. Indeed, the content of the Bill of Rights was by definition largely anthropomorphic and dealt with human rights as such. There would thus be an absurdity for a county government to have purported to directly claim or seek to enforce for itself the rights and freedoms listed therein.
  6. The entire human rights edifice lay on theoritical framework built in large part on the natural law theories which treated human rights as a human attribute flowing directly and inescapably from the humanness of the right holders. In its historical origins, conceptually and doctrinally, the Bill of Rights in the Constitution enumerated rights that were essentially human rights and so were claimable essentially by individuals. Indeed, under the general provisions relating to the Bill of Rights, the Constitution at article 19(2) and (3) declared the centrality of the individual person as the owner of rights and by juxtaposition contrasted with the State.
  7. The Bill of Rights was spoken of together and often interchangeably with fundamental freedoms and the context was clearly personal and individualized. The Constitution at article 21(4) commanded the State to enact and implement legislation to fulfill its international obligations in respect of human rights and fundamental freedoms. Those obligations flowed from international and regional human rights treaties, conventions and other covenants which all spoke of human rights and fundamental freedoms of individuals. It was no surprise indeed that article 25 of the Constitution in declaring the fundamental rights and freedoms that could not be limited contained a list that was self-evidently personal and could only belong to individuals in their natural human capacity. The entire corpus of rights was of the same character in tone, content and context and proceeds overwhelming from an individual, human personalized perspective.
  8. When it came to enforcement of the Bills of Rights, the Constitution in article 22(1) provided for locus by first acknowledging that every person had the right to institute court proceedings claiming that a right or fundamental freedoms in the Bill of Rights had been denied, violated or infringed, or was threatened. That acknowledged the primacy of the individual as the first claimant and enforcer of the Bill of Rights in respect of himself. Besides the implicated individual the Constitution literally flung open the gates of locus standi long held shut by narrow minimalist approaches in article 22 (2).
  9. Only individual persons bore rights and could be victims of violation of the Bill of Rights, either in singular or in plurality, say as a group or a class of persons. When it came to enforcing the Bill of Rights, the litigant needed not be a person directly affected. Thus one could sue on behalf of a person unable to act in their own name, such as a child and one could also sue in representative capacity or in the public interest. Moreover, an association could move the Court on behalf and in the interest of its members.
  10. For purposes of enforcement of the Bill of Rights all one needed to establish was that he or she was a person capable of suing. Article 21 of the Constitution had to be consistently and in conformity with the contextual command of article 260, be so construed as to include persons other than individual human persons in the construction of the persons who could enforce rights even though, against contextually, such non-individuals could not be themselves holders or wielders of rights and fundamental freedoms under the Bill of Rights.
  11. State organs could indubitably file suit inter se to protect various rights, capabilities, competencies and privileges accorded to them by the Constitution. What state organs could not in and of themselves do, was to purport to claim for themselves and enforce for themselves qua State organs, the rights enumerated in the Bill of Rights. Such rights belonged only to individuals as natural persons who only could enforce or protect them in person or through any other persons be they natural or juristic.
  12. Had the various officers of the Appellant or any one of them, on behalf of whom the Appellant went to court, been co-petitioners claiming that their rights as individual natural persons had been or were in danger of being violated or infringed, the Petition before the Trial Court would have been competent. They were not joined, however, and the claim as it stood was to the effect that the Appellant, a juristic person and a State Government at that had been a victim of violation of various postulates of the Bill of Rights. In principle the Petition as presented was making impossible claims and was factually contradictory and so incompetent. The Bill of Rights afforded protections and guarantees for natural persons as individuals and that protection did not extend to the State or its organs such as national and county governments.
  13. The Appellant was not a person who could petition the Trial Court for violation of own fundamental rights and freedoms under article 22 of the Constitution by another State Organ.
  14. The finding by the Trial Court that sections 26, 27 and 28 of the Anti-Corruption and Economic Crimes Act (ACECA) were inapplicable to the Appellant as it was not a person reasonably suspected of corruption or economic crimes or an associate of such person there-contemplated, appeared on its face to be correct. In view of the determinative nature of the finding on whether the Appellant could sue to enforce the Bill of Rights in respect of itself qua County Government, it was unnecessary for the Trial Court to have gone into an interrogation of the question which was rendered otiose by its first finding.
  15. Equally unnecessary for the Trial Court to have gone into was the question of whether the Respondent acted properly in moving the Subordinate Court for warrants of search and seizure under section 118 of the Criminal Procedure Code. It seemed rather obvious that the question was not a constitutional one, much less a Bill of Rights one. The petition before the Court was for redress of violation of rights which the Appellant had no capacity to do with regard to itself. As to the procedural aspects of warrants of search and seizure and what was to befall any goods seized remedies were to be found in the statute itself.
  16. Whatever the arguments there could be on both sides with regard to the intersection of and interaction between the Criminal Procedure Code and ACECA and whether the exercise of search and seizure powers as against persons suspected of corruption was abusive, whether potentially or in actuality, of various rights in the Bill of Rights, the Court would be engaging in an exercise in futility and launching into a wholly academic and theoretical, hypothetical pursuit since what conclusions the Court would have arrived at would be in the realm of argument and polemics only given that the Appellant was not possessed of those rights. Those arguments had to best await a pronouncement that could only be made in an appropriately live and ripe case, which the instant case was not.

Appeal dismissed, each party to bear own costs.

CONSTITUTIONAL LAW Only an Authorized Entity can Measure whether Noise and Vibration Levels Exceed What is Legally Permissible.

Elizabeth Kurer & Detler Heir (Suing on their behalf and on behalf of aggrieved residents of Watamu within Kilifi County) v County Government of Kilifi & 4 others
Petition No 23 of 2016
Environment & Land Court at Malindi
J O Olola, J
April 19, 2018
Reported by Beryl A Ikamari

Download the Decision

Constitutional Law-fundamental rights and freedoms-enforcement of fundamental rights and freedoms-right to a clean and healthy environment-locus standi (right to sue)-extent of locus standi where the enforcement of the right to a clean and healthy environment was sought-Environmental Management and Coordination Act, No. 8 of 1999, section 3.
Statutes-interpretation of statutory provisions-regulation 6 of the Environmental Management and Coordination (Noise and Excessive Vibration Pollution) (Control) Regulations, 2009-noise pollution-persons authorized to measure whether noise and vibration levels exceeded what was legally permissible-whether residents allegedly affected by noise pollution could measure noise pollution levels without seeking authorization from any entity-Environmental Management and Coordination (Noise and Excessive Vibration Pollution) (Control) Regulations, 2009, regulation 6.

Brief facts:
The 4th Respondent, Kioko Enterprises Ltd, was the registered proprietor of land in Watamu town on which the 5th Respondent, Marval Limited operated a restaurant known as Comeback Restaurant, Lounge and Disco. The Petitioners complained that since the year 1998, the restaurant played very loud music which caused residents of Watamu sleepless nights. They also said that the restaurant was interfering with learning activities for children whose schools were situated less than 300 metres away from it. Generally, they stated that the restaurant interfered with their peaceful and quiet enjoyment of property and therefore it violated their right to a clean and healthy environment.
The Petitioners' complaint against the 1st Respondent, the County Government of Kilifi was that it failed to implement the Kilifi County Liquor Control Act which was being breached at the restaurant. Their grievance against the 2nd Respondent, the Officer Commanding Police Division Kilifi, was that he declined to stop the activities of the 4th & 5th Respondents and violated article 35 of the Constitution, by declining to supply information regarding the owners of the restaurant.

Issues:

  1. What was the extent of locus standi in actions founded on the right to a clean and healthy environment?
  2. Who was legally authorized to make measurements to determine whether noise and vibration levels exceeded what was legally permissible? Read More..

Held:

  1. Section 3 of the Environmental Management and Coordination Act, No. 8 of 1999 (EMCA) provided for locus standi concerning actions founded on the right to a clean and healthy environment. A person alleging a violation or threat to the right to a clean and healthy environment, while acting on his behalf or on behalf of a group or class of persons, members of an association or in public interest, was allowed to seek redress at the Environment and Land Court. Such a person did not have to demonstrate personal loss or injury arising from the offending conduct in relation to the environment.
  2. It was apparent that in 2013 some residents of Watamu town complained to the Kilifi Governor about noise pollution emanating from the restaurant. An improvement notice was issued to the restaurant and all discos at the establishment were stopped until clearance was obtained from the 1st Respondent, the Kilifi County Government.
  3. Under section 7 and 9 of EMCA, the National Environmental Management Authority (NEMA) was established as a body corporate charged with the functions of supervising and coordinating all matters relating to the environment. It constituted the principal instrument of the Government in the implementation of policies relating to the environment.
  4. Section 147 of EMCA gave NEMA power to make regulations for purposes of discharging its duties. In exercise of those powers NEMA enacted the Environmental Management and Coordination (Noise and Excessive Vibration Pollution) (Control) Regulations, 2009. The said Regulations defined noise pollution as the emission of uncontrolled noise that was likely to cause danger to human health or damage to the environment. Regulation 3(1) of the Regulations outlawed the making of or causing to be made any loud, unreasonable, unnecessary or unusual noise which annoys, disturbs, injures or endangers the comfort, repose, health or safety of others and the environment.
  5. The measurement of noise levels and vibration levels to determine whether they exceeded permissible levels, under the Regulations, was to be done by a lead agency. Under the Regulations, a lead agency meant any Government Ministry, department, parastatal, State Corporation or local authority, in which any law vested functions of control or management of any element of the environment or natural resources. Measurement of noise levels could be done by NEMA after issuance of a reasonable notice to NEMA, where there was no lead agency available to take the measurements or where a lead agency had failed to take action.
  6. The Petitioners did not exhibit guidelines issued by NEMA for the measurement of noise and excessive vibration. Additionally, the exhibited document containing noise pollution measurements, an email sent by the 1st Petitioner on September 7, 2014, to prove that noise and vibration levels emanating from the restaurant were excessive did not emanate from a lead agency or a person appointed by NEMA. The document on measurement of noise pollution was made by the Petitioners.
  7. Even if there were NEMA guidelines to measure noise and vibration levels, the Petitioners were not authorized by NEMA to conduct measurements nor did they have knowledge of the proper use of the equipment as provided by the Regulations.

Petition dismissed.

STATUTES Court of Appeal Affirms High Court Decision to Nullify the Results of the Wajir County Gubernatorial Elections.

Mohamed Abdi Mahamud v Ahmed Abdullahi Mohamad & 3 others
Election Petition Appeal No 2 of 2018
Court of Appeal at Nairobi
P N Waki, Asike-Makhandia & P O Kiage, JJ A
April 20, 2018
Reported by Beryl A Ikamari
Download the Decision

Statutes-interpretation of statutory provisions-section 85A of the Elections Act-appellate jurisdiction in election petitions-appeals from the High Court to the Court of Appeal-the requirement that election petition appeals to the Court of Appeal were to be founded on questions of law only-the nature of questions that would constitute questions of law-Elections Act, No 24 of 2011, section 85A.
Jurisdiction-jurisdiction of the High Court-jurisdiction of the High Court in an election petition-jurisdiction over issues relating to the nominations stage and qualifications of candidates nominated to contest for posts-questions relating to the educational qualifications of such candidates-whether questions or disputes relating to the nominations stage were exclusively within the competence of the Independent Electoral and Boundaries Commission (IEBC)-Constitution of Kenya 2010, article 88(4)(e); Elections Act, No 24 of 2011, section 22(2).
Electoral Law-elections-stages in an election-extent of activities that would form part of an election-whether an election was a process or an event and whether nominations were part of an election.
Electoral Law-gubernatorial elections-qualifications necessary for candidate to vie for the post of Governor-educational qualifications-bachelor's degree-effect of failure by an elected Governor to show possession of the requisite educational qualifications-Elections Act, No 24 of 2011, section 22(2).

Brief facts:
The Appellant was the declared winner of the Wajir gubernatorial elections held on August 8, 2017. The 1st and 2nd Respondents, who were his closest competitors in the elections challenged the result of the election at the High Court. The result of the election was challenged at the High Court on grounds which included the alleged failure of the Appellant to have the required educational qualifications to vie for the post of Governor, unlawful assisted voting, incorrect tallying of votes, an excess in votes cast as compared to registered voters in some polling stations, tampering with the number of registered voters as indicated in the public portal, making of false entries, manipulation of results which caused striking coincidences and incredible figures, commission of electoral offences and failure to secure ballot papers and boxes.
At the High Court, the Appellant's election as Governor was nullified. The Appellant appealed to the Court of Appeal. His grounds of appeal included wrongful assumption of jurisdiction by the High Court over matters, concerning educational qualifications, that ought to have been handled at the nomination stage, the High Court’s alleged failure to appreciate that the 1st and 2nd Respondents ought to have proved the accusations they made against the Appellant and that all the clerical irregularities, if any, did not affect the outcome of the election or give the Appellant a numerical advantage. The Appellant also asserted that the High Court finding that he was not validly elected as the Governor of Wajir County was wrongful.

Issues:

  1. What issues or questions would constitute questions of law in an election petition?
  2. Whether an election was a process or an event.
  3. Whether the High Court had jurisdiction to determine whether a candidate met all the qualifications, including educational qualifications, for nomination in order to contest in a gubernatorial election.
  4. Whether the Appellant satisfied the legal qualification criteria applicable to candidates who were nominated to vie for the post of Governor. Read More...

Held:

  1. All the grounds of appeal, with the exception of the alleged wrongful assumption of jurisdiction over the issue on educational qualifications required for purposes of contesting for the post of Governor, raised both issues of fact and law. Section 85A of the Elections Act expressly stipulated that appeals to the Court of Appeal in election matters would be limited to questions of law only.
  2. For purposes of election petitions, questions of law are questions or issues involving the following:-
    1. the interpretation of a provision of the law in the High Court concerning membership of the National Assembly, the Senate, or the office of the County Governor;
    2. the application of a provision of the law in the High Court concerning membership of the National Assembly, the Senate, or the office of the County Governor;
    3. conclusions arrived at by the High Court concerning membership of the National Assembly, the Senate, or the office of the County Governor where it was claimed that the conclusions were not based on evidence or were so perverse or illegal that no reasonable tribunal would have made them but it was not enough to contend that the High Court would have arrived at a different conclusion on the basis of the evidence.
  3. In electoral matters there was no such thing as questions of mixed law and fact. Grounds of appeal that were of such a mixture were clearly inappropriate and probably incompetent. It was therefore appropriate to strike out all grounds of appeal presented by the Appellant on factual foundations. The appeal would be based on two legal issues only, namely, whether the Appellant had met the constitutional and statutory qualifications to vie for the post of Governor and whether the High Court had jurisdiction to enquire into the issue which related to the Appellant's nomination to vie for the post.
  4. Jurisdiction is everything and without it a Court has no power to make one more step. Jurisdiction is the soul, source, breath and life blood of judicial authority. Orders made without jurisdiction were empty nullities with neither coercive nor compulsive authority.
  5. The issue as to whether the IEBC under article 88(4)(e) of the Constitution had the exclusive mandate to make determinations as to whether a candidate met the legal qualifications for nomination, including academic qualifications, rested on a determination on whether an election was a process. An election was a process and not an event and hence, the High Court, as an election court, was possessed of jurisdiction to enquire into matters of nomination. Nominations were part of the continuum consisting of a plurality of stages that made up an election.
  6. The election Court had jurisdiction to enquire into a question as to the qualification of a candidate which went to his eligibility to vie in cases where the matter had not been handled with finality by any other body constitutionally or statutorily mandated to do so.
  7. The case was first and foremost about whether or not the Appellant had the requisite degree qualification for one to run for Governor under section 22(2) the Elections Act. At the High Court some evidence was tendered to show that the Appellant did not have a valid degree certificate from Kampala University.
  8. Evidence was adduced to show that the Appellant did not have qualifications that would allow him to be admitted to study for a degree at Kampala University. It was shown that while being vetted for an ambassadorial posting to Saudi Arabia, the Appellant made a statement on oath before a committee of the national assembly on September 3, 2014, stating that he was yet to graduate. It was shown that after being posted to Riyadh there was no evidence that he attended classes at Kampala University. It was also shown that in his statutory declaration for purposes of contesting in the gubernatorial elections, the Appellant indicated that his highest educational qualification was a bachelor’s degree yet he produced before the IEBC a Master’s degree dated March 12, 2015. There was no evidence that he engaged in full time accelerated post-graduate studies to qualify for the Master’s degree and the Appellant's name did not appear in the university's graduation booklet.
  9. The Appellant did not deny any of the allegations concerning his educational qualifications. His response was that the issue concerning those allegations had been litigated at the Ugandan High Court and that High Court dismissed the case. The Appellant did not attend the High Court proceedings and was not cross-examined on his replying affidavit. Therefore, his replying affidavit was robbed of probative value.
  10. The High Court's finding that prima facie evidence had been tendered to prove the invalidity of the bachelor's degree certificate dated March 1, 2012 and that the evidential burden of proof had shifted to the Appellant to discharge that evidence, could not be faulted. The legal burden of proof remained with the 1st and 2nd Respondent but the evidentiary burden shifted to the Appellant.
  11. Unless the parties agreed by consent to have affidavit evidence admitted without cross-examination of the deponent, the Election Petition Rules required the Appellant to avail himself for cross-examination on his replying affidavit. No explanation was given for the Appellant's failure to testify. The consequences of non-attendance were that where there was evidence tending to prove a particular fact, albeit slender, silence in circumstances where a party was expected to controvert that evidence would potentially convert that evidence into proof.
  12. The High Court's conclusion that the Appellant was not legally cleared to vie for the position of Governor as he did not satisfy the qualification criteria set out in section 22(2) of the Elections Act, was justified. The consequence of the finding was that the Appellant's election had to be invalidated.
  13. A person who was not qualified to vie for a particular seat could not hold onto his false victory by pointing to the margin of his vote vis-a-vis his competitors. He ought not to have been in the race in the first place and the alleged victory would be a distortion of reality and a subversion of the electoral process.

Appeal dismissed.

CONSTITUTIONAL LAW Court Awards Monetary Compensation for Violations of the Right to Reproductive Healthcare.

J O O aka J M v Attorney General & 6 others
Petition Case No 5 of 2014
High Court at Bungoma
Ali-Aroni, J
March 22, 2018
Reported by Beryl A Ikamari
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Constitutional Law-petition for the enforcement of fundamental rights and freedoms-form and content of the petition-particulars that need to be pleaded when drafting the petition-precision with respect to the nature of the complaint, the rights said to have been violated and the manner in which they were violated-whether a petition was drafted in a clear and precise manner-Constitution of Kenya 2010, article 159.
Constitutional Law-fundamental rights and freedoms-enforcement of fundamental rights and freedoms-right to dignity, freedom from cruel, inhuman and degrading treatment, right to health and the right to access information-where it was alleged that a Petitioner delivered a baby on a concrete floor without assistance and was abused and shouted at by nurses-where it was alleged that information on how to channel a grievance against an institution was not availed-whether fundamental rights and freedoms were violated under the circumstances-Constitution of Kenya 2010, articles 43, 28, 29(j) & 35.
Constitutional Law-enforcement of fundamental rights and freedoms-remedies for violations of fundamental rights and freedoms-declarations and monetary compensation-considerations of the Court when determining the amount of monetary compensation to be awarded-Constitution of Kenya 2010, article 23(3).

Brief Facts:
On August 8, 2013, the Petitioner visited the Bungoma County Referral Hospital, then known as Bungoma District Hospital for maternal healthcare. She consulted a doctor and she was advised that she would have to undergo induced labour due to delayed delivery. She was then advised to buy cotton wool and have the inducement drug administered. The drug was administered but nurses failed to monitor her progress even though she sought help for labour pains that she experienced. There was however an instance where a nurse checked on her and told her that she was not yet due for delivery.
When her labour pains intensified and she did not get assistance, the Petitioner made her way to the delivery room. She found that the 3 beds in the room were occupied by other women who were in the process of delivery. When she attempted to walk back to the labour ward, she lost consciousness and apparently delivered her baby. When she woke up, there were shouts and abuses from nurses who asked her why she had delivered and soiled the floor. In a weak and vulnerable condition, she was ordered to carry her placenta and walk to the delivery room.
The Petitioner stated that there was no apology offered to her for the incident. She said that it showed failure by the National and County Governments to ensure quality maternal healthcare. She filed a petition in Court while stating that her right to healthcare, freedom from cruel, inhuman and degrading treatment, right to information, right to life and consumer rights were violated.
Generally the Respondents denied that there was a violation of the Petitioner’s rights. It was also stated by the 2nd, 3rd and 5th Respondents that the drafting of the petition was imprecise as regards the nature of rights concerning which violation was alleged.

Issues:

  1. Whether the petition was drafted in a manner that revealed the nature of the Petitioner's claim with respect to the complaint, the fundamental rights and freedoms alleged to have been violated and the manner in which they were violated.
  2. Whether the Petitioner's right to dignity, healthcare and information were violated.
  3. Whether the National Government and County Governments failed to establish policy guidelines on how to effectively implement the national directives on free maternal healthcare.
  4. What remedies were appropriate under the circumstances? Read More...

Held:

  1. The Petitioner was clear in her petition about her grievance and the alleged violation of her rights. If there were shortcomings in the drafting of the petition, article 159 of the Constitution would be applicable. The stated article 159 required Courts to be guided by various principles in exercising judicial authority and one of those principles was that justice ought to be administered without undue regard to technicalities.
  2. The allegations on violation of rights to maternal healthcare were denied. However, there was an admission that facilities at the Bungoma County Referral Hospital were over stretched. The number of beds and healthcare providers were few compared to the number of patients seeking maternal healthcare. It was also admitted that the Petitioner gave birth on the concrete floor because the delivery room was occupied by other patients.
  3. Article 43 of the Constitution provided for the right to health. Particularly, article 43(1)(a) provided that every person had the right to the highest attainable standard of health including the right to healthcare services and reproductive healthcare. The right to health was also recognized in other regional and international instruments. For example, that right was recognized under article 12(1) of the International Covenant on Economic, Social and Cultural Rights (ICESCR) and article 16 of the African Charter on Human and People’s Rights (the Banjul Charter).
  4. The right to healthcare encompassed proper treatment at hospital, availability of necessary equipment, facilities and medication. The Petitioner did not receive that at the hospital. The Respondents failed to avail basics such as drugs and cotton wool. Requiring poor women to buy cotton wool at a public hospital, where healthcare was anchored on the Constitution and a presidential directive which was specific on the provision of free maternal healthcare, was a violation of basic rights.
  5. The Petitioner gave birth on a concrete floor between the delivery room and the labour ward without assistance. That was a violation of her right to dignity. Third parties were able to watch and video tape the delivery and the shouting and abuse she experienced after giving birth. The shouting and abuse were denied but the video clip was clear about that. There was no denial concerning the Petitioner being ordered to walk while carrying the placenta which had not been expended. That action was cruel, humiliating and demeaning.
  6. Under article 28 of the Constitution every person had inherent dignity and the right to have that dignity respected and protected. Further, article 29(j) of the Constitution provided for every person's right to freedom and security of the person including the right not to be treated or punished in a cruel, inhuman and degrading manner. The African Charter on Human and Peoples’ Rights (Banjul Charter) also provided for the right to dignity.
  7. No matter how overstretched the facilities were, the nurses' actions were inexcusable. They were not available to offer the Petitioner the care and attention that she needed. The Petitioner did not deserve the cruelty and abuse which she experienced. Nurses owed a duty of care to patients. The nurses' actions were an infringement of the Petitioner's right to dignity.
  8. In the era of transparency and accountability, it was important for complaint mechanisms in institutions, such as public institutions, to be made public by being conspicuously displayed. That would enable aggrieved persons to know how to channel their grievances. The Petitioner did not complain against anyone before being discharged from hospital and she did not testify that necessary information was not disclosed to her. The right of access to information provided for under article 35 of the Constitution was not applicable to the circumstances.
  9. The measures and policies on the implementation of the national directive of free maternal healthcare would go a long way in ensuring effective implementation of the healthcare services. The National and County Governments had not devoted adequate resources to healthcare services and had not put in place effective measures to implement, monitor and provide minimum acceptable standards of healthcare. In failing to do so, there was a violation of the Constitution and international instruments.
  10. For a violation, denial or infringement of a right or fundamental freedom, under article 23(3) of the Constitution, the Court could grant various remedies including a declaration and compensation. In addressing the Petitioner's injuries, the Court would have due regard to the fact that no amount of monetary compensation would redress the pain and suffering that the Petitioner went through. Compensation was a mere attempt at acknowledgement of the infringement of rights and an attempt at reparation.

Petition allowed.
Orders: -

  1. The Court declared that the physical and verbal abuse meted out to the Petitioner at the 5th Respondent facility amounted to violation of her right to dignity and right not to be subjected to cruel, inhuman and degrading treatment.
  2. The Court declared that the neglect the Petitioner suffered was as a result of the National and County Government’s failure to ensure healthcare services were of quality and were available.
  3. The Court declared that the National Government & County Government of Bungoma failed to develop and/or implement policy guidelines on healthcare thus denying the Petitioner her right to basic healthcare.
  4. The Court declared that the National Government & the County Government of Bungoma failed to implement and/or monitor the standards of free maternal healthcare and services thus resulting in the mistreatment of the Petitioner and violation of her right to dignity, and treatment that was cruel, inhuman or degrading.
  5. The Court directed and ordered that a formal apology be made to the Petitioner by the 3rd Respondent, the 5th Respondent and the three nurses who violated the rights of the Petitioner.
  6. The Court awarded damages of Kshs. 2,500,000 to the Petitioner as a result of the infringement of her rights.
  7. The Court awarded costs of the suit to the Petitioner.
  8. The award and costs were against the 2nd and 4th Respondents in equal shares.
CONSTITUTIONAL LAW The Definition of a Public Officer under Section 2 of the Public Officer Ethics Act is Unconstitutional

Samuel Thinguri Warwathe v Commissioner for Co-operative Development & 2 others
Petition 7 of 2017
High Court at Kiambu
Joel Ngugi, J
July 31, 2017
Reported by Beryl A Ikamari

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Constitutional Law-interpretation of the provisions of the Constitution-principles of constitutional interpretation-unconstitutionality of a statutory provision-definition of a public officer under the Constitution and under the Public Officer Ethics Act-where the statutory definition of a public officer was different from the constitutional definition of a public officer-whether the statutory provision was unconstitutional-Constitution of Kenya 2010, articles 259, 260 & 24; Public Officer Ethics Act (No. 4 of 2003), section 2.

Brief Facts:
The Petitioner was a Chairman in two co-operatives societies. Those co-operative societies were the Chamber Unity Savings and Credit Cooperative Society Limited and the Chamber Unity Housing Co-operative Society Limited. The Commissioner for Cooperative Development sent him a letter dated January 27, 2017 whose import was that as a public officer, occupying the office of chairman of a co-operative society, he would need to resign from office by February 7, 2017 in order to contest for an elective post in the general elections on August 8, 2017.
The Petitioner stated that a chairman of a co-operative society was not a public officer and therefore there was no need for such a chairman to resign in order to contest for an elective seat in the general elections. He went to Court seeking various orders including an order declaring that section 2(e) of the Public Officer Ethics Act was inconsistent with article 260 of the Constitution. The said section 2(e) of the Public Officer Ethics Act provided for a definition of a public officer which was different from that which was provided under the Constitution.

Issues:

  1. Whether section 2(e) of the Public Officer Ethics Act, which included officers, members or employees of a co-operative society within the definition of a public officer, was inconsistent with article 260 of the Constitution of Kenya 2010, in the sense that it provided for a definition of a public officer which was different from the definition of a public officer under the Constitution.
  2. What were the principles applicable to the interpretation of the Constitution? Read More..

Relevant provisions of the law
Constitution of Kenya 2010, article 260;
...“public officer” means—

(a) any State officer; or
(b) any person, other that a State Officer, who holds a public office.
“public office” means an office in the national government, a county government or the public service, if the remuneration and benefits of the office are payable directly from the Consolidated Fund or directly out of money provided by Parliament...

Public Officer Ethics Act (No. 4 of 2003), section 2;
“public officer” means any officer, employee or member, including an unpaid, part-time or temporary officer, employee or member, of any of the following—

(a) the Government or any department, service or undertaking of the Government;
(b) the National Assembly or the Parliamentary Service;
(c) a local authority;
(d) any corporation, council, board, committee or other body which has power to act under and for the purposes of any written law relating to local government, public health or undertakings of public utility or otherwise to administer funds belonging to or granted by the Government or money raised by rates, taxes or charges in pursuance of any such law;
(e) a co-operative society established under the Co-operative Societies Act (No. 12 of 1997):
Provided that this Act shall apply to an officer of a co-operative society within the meaning of that Act;
(f) a public university;
(g) any other body prescribed by regulation for the purposes of this paragraph;

Held:

  1. Article 259 of the Constitution provided for the manner in which the Constitution would be interpretation. The Constitution would be interpreted in a manner that promoted its purposes, values and principles, advanced the rule of law and the human rights and fundamental freedoms in the Bill of Rights, permitted the development of the law and contributed to good governance. The Constitution would also be construed according to the doctrine of interpretation that the law is always speaking. Courts were required to interpret the Constitution in a manner that eschews mechanical jurisprudence and breathes meaning to the Constitution in a way that comports with the lived realities of the people of Kenya. The interpretation of the Constitution had to be contextual-in light of the history and social context that shaped the Constitution.
  2. Even purposive interpretation of the Constitution would begin with the words and text of the Constitution. Of course, the text would be interpreted with a clear rear view of the history and purpose of the text as well as a clear view of the present context.
  3. In article 260 of the Constitution a definition was offered for both the term public office and the term public officers. In the stated article 260 a public officer meant any state officer or any person other than a state officer who held a public office. It also stated that a public office meant an office in the National Government, a County Government or the public service, if the remuneration and benefits of the office were payable directly from the Consolidated Fund or directly out of money provided by Parliament.
  4. The definition provided in article 260 of the Constitution was the definition provided by the supreme law of the land. The definition's importance was that there were certain constraints placed on the liberties and freedoms of public officers due to the nature of their work. The constraints were meant to ensure good governance in Kenya. Therefore whoever got labelled a public officer had to fit the constitutional categorization because the label came with restrictions and constraints.
  5. Under section 2 of the Public Officer Ethics Act, a public officer meant any officer, employee or member, including those that were unpaid or part-time, of the Government, National Assembly, a state corporation or body which administered funds granted by the Government or raised through taxation and a co-operative society. The definition was different in scope from that which was provided in article 260 of the Constitution.
  6. The Constitution had to be interpreted strictly in favour of maximizing justice and expanding rights. The statutory definition of a public officer provided for in section 2 of the Public Officer Ethics Act was different and more restrictive than the one provided for under the Constitution. Any restrictions to fundamental rights and freedoms had to be pronounced in the Constitution itself or provided by a statute which met the test provided for in article 24 of the Constitution.
  7. The definition provided in section 2 of the Public Officer Ethics Act was more restrictive than that provided for in article 260 of the Constitution. Section 2 of the Public Officer Ethics Act did not pass constitutional muster. Any law that was inconsistent with the Constitution was unconstitutional to the extent of the inconsistency.

Petition allowed.

DEVOLUTION The Applicable Procedure in Appropriation and Approval of Withdrawal of County Public Funds

County Assembly of Machakos v Governor, Machakos County & 4 others [2018] eKLR
Petition No 17 of 2017
High Court at Machakos
P. Nyamweya, J
January 16, 2018
Reported by Kakai Toili

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Devolution – county governments – county government funds – withdrawal of county government funds - appropriation and approval - what was the applicable procedure in appropriation and approval of withdrawal of county public funds – Constitution of Kenya, 2010, article 228 (4) & (5); Public Finance Management Act, 2012, sections 107 (1) & 109 (6)
Civil Practice and Procedure – preliminary objections – requirements for one to raise a preliminary objection - what were the requirements for one to raise a Preliminary Objection
Jurisdiction – jurisdiction of the High Court – jurisdiction over financial powers of organs of county governments – Constitution of Kenya, 2010, article 165
Civil Practice and Procedure – injunctions – mandatory injunctions – requirements for a mandatory injunction to be issued - what were the requirements to be met before a mandatory injunction could be issued
Civil Practice and Procedure – orders – conservative orders – applicable principles in granting conservative orders - what were the applicable principles in granting conservatory orders

Brief Facts:
The Petitioner filed a Petition before the Court and simultaneously also filed an application by way of Notice of Motion contending that the failure by the 1st and 2nd Respondents to release the funds requisitioned by the Petitioner was unconstitutional and illegal, that the same had occasioned grave prejudice to its operations and had infringed or was likely to infringe its constitutional rights. The Petitioner sought various prayers in its Petition, namely, a permanent injunction restraining the Respondents from withholding any funds budgeted for, approved and allocated to the Petitioner by the 4th Respondent, orders compelling the 1st to 4th Respondent to release all funds due to the Petitioner as per its budget and declarations that the actions of the Respondents were unconstitutional.
The 1st and 2nd Respondents subsequently filed their Responses to both the Petition and the Petitioner’s Application together with a Notice of Preliminary Objection objecting the Petitioner’s Application and Petition on the grounds that the Court lacked jurisdiction to deal with the issues raised therein, as the Petitioner was allegedly dissolved by the members of the Petitioner when they passed a motion to create the People’s Assembly, the issues raised fell within the purview of the oversight powers of Senate and County Assembly and that the alleged actions did not fall within the functions and responsibilities of the 1st Respondent.

Issues:

  1. What was the applicable procedure in appropriation and approval of withdrawal of county public funds?
  2. What were the requirements for one to raise a Preliminary Objection?
  3. Whether the High Court had jurisdiction over the financial powers of organs of county governments.
  4. What were the requirements to be met before a mandatory injunction could be issued?
  5. What was the applicable procedure in appropriation and approval of withdrawal of county public funds?
  6. What were the applicable principles in granting conservatory orders?Read More...

Relevant Provisions of the Law:
Public Finance Management Act, 2012,
Section 107 - County Treasury to enforce fiscal responsibility principles
(1) A County Treasury shall manage its public finances in accordance with the principles of fiscal responsibility set out in subsection (2), and shall not exceed the limits stated in the regulations.

Section 109- Establishment of a County Revenue Fund for each county government
(6) The County Treasury shall obtain the written approval of the Controller of Budget before withdrawing money from the County Revenue Fund under the authority of—

(a) an Act of the county assembly that appropriates money for a public purpose;
(b) an Act of Parliament or county legislation that imposes a charge on that Fund; or
(c) this Act in accordance with sections 134 and 135.

Held:

  1. A Preliminary Objection was in the nature of what used to be a demurrer. It raised a pure point of law which was argued on the assumption that all the facts pleaded by the other side were correct. It could not be raised if any fact had to be ascertained or if what was sought was the exercise of judicial discretion.
  2. The effect of a preliminary objection if upheld rendered any further proceedings before the Court impossible or unnecessary. A preliminary objection could not therefore be raised if any fact required to be ascertained. In the instant Preliminary Objection, the facts that the 1st and 2nd Respondents raised as regards the formation of a People’s Assembly by the County Assembly of Machakos were subject to proof as regards their authenticity. Furthermore, they were also subject to legal argument as regards their legal effect. Likewise, the allegations as regards the functions of the 1st and 2nd Respondents being non-suited in the matter required further evidence and argument to establish their veracity or otherwise. Those two grounds for the Preliminary Objection did not raise any question of law and had to await further argument during the hearing or upon the relevant applications being made.
  3. The only question of law raised in the Preliminary Objection was that of the Court’s jurisdiction. Jurisdiction was granted by law or other like legal instrument. The issue of the financial powers given by the Constitution to the Petitioner and the 1st and 2nd Respondents as organs of county governments and the relationship between those organs and other levels of Government fell within the ambit of article 165 of the Constitution and was within the jurisdiction of the Court.
  4. Any limitation as to the jurisdiction of a court had to by law be granted. There was no provision in the Constitution or any law that provided that the jurisdiction granted to the Court was limited as regards the actions of County Assemblies or any other constitutional or statutory bodies.
  5. Oversight was the review, monitoring and supervision of government agencies, programs, activities and policy implementation. Oversight functions consisted of a wide array of activities and systems that were put in place to examine the effectiveness, efficiency and adequacy of the administration of a government organ, department or agency. When it came to public finance, the oversight extended to powers given to Parliament and County Assemblies to authorization all government expenditure and the auditing of public accounts.
  6. The question of whether the Court in exercising its jurisdiction would be offending the doctrine of separation of powers and oversight powers of the Senate and County Assemblies was one that could only be decided upon after the parties had canvassed their respective positions, upon which the Court could then make a decision one way or another as to whether the dispute was one that could be resolved by way of judicial processes or by other processes. In other words, an objection as to infringement of the doctrine of separation of powers was not a jurisdictional issue but a substantive and factual issue to be determined upon hearing of evidence and opinion.
  7. The supervisory jurisdiction of the Court granted by article 165 of the Constitution was an exclusive one in terms of making definitive and binding decisions on the processes and actions whose legality and constitutionality was disputed. Article 96 of the Constitution could not therefore be interpreted as a clause that ousted the supervisory jurisdiction of the Court or limit the power of the Court to interpret the Constitution nor could they be construed as provisions that prohibited the right of a citizen to access a court of law where there was an allegation of infringement of a constitutional right.
  8. The principles for the grant of mandatory injunctions are settled. There must be special circumstances shown over and above the establishment of a prima facie case for a mandatory injunction to issue and even then only in clear cases where the Court thinks that the matter ought to be decided at once.
  9. A prima facie case in a civil application included but was not confined to a genuine and arguable case. It was a case which, on the material presented to the Court, a tribunal properly directing itself would conclude that there existed a right which had apparently been infringed by the opposite party as to call for an explanation or rebuttal from the latter.
  10. The applicable procedure in appropriation and approval of withdrawal of funds was, in accordance with section 109(6) of the Public Finance Management Act, 2012. the County Treasury made a written request for authority to withdraw funds from the County Revenue Fund. The Controller of Budget then reviewed the requisition for conformity with the law in accordance with article 228(5) of the Constitution and section 109(6) of the Public Finance Management Act, 2012. If satisfied that the requisition complied with the law, the Controller of Budget in accordance with article 207 and 228(4) of the Constitution approved the withdrawal of funds. Once authority for the withdrawal of funds was given, the County Treasury prepared instructions to the Bank (Central Bank) to transfer the funds from the County Revenue Fund (Exchequer Account) to the operations Account. Article 201 of the Constitution in that regard provided for the principles that guided public finance management. In addition, section 107(1) of the Public Finance Management Act set out the fiscal responsibility principles that the County Treasury was supposed to apply in its decision making on and management of the County Revenue Fund.
  11. Under section 109(6) of the Public Finance Management Act, the County Treasury had to obtain the written approval of the Controller of Budget before withdrawing money from the County Revenue Fund under the authority of inter alia, an Act of the County Assembly that appropriated money for a public purpose. The Petitioner had passed an Appropriations Act and obtained the necessary approval from the Controller of Budget for withdrawal of the sum of Kshs.63,248,046/= for the recurrent budget and kshs.16,006,613/= for the development budget requisitioned for by the Petitioner and approved by the 4th Respondent.
  12. The 1st and 2nd Respondents had not brought any evidence to show contravention of the applicable principles or law on the part of the Petitioner. The arguments raised on the effects of the passing of a motion on a People's Assembly particularly on the Petitioner's public finance expenditure were not shown and in addition, the said motion was passed on December 9, 2017, after the requisition for funds had been made and the approval of withdrawal by the 4th Respondent given in November 2017. It could not be validly raised as a reason that was existing as the time of the said requisition.
  13. The Petitioner had not only established a prima facie case, but that it was a clear case that warranted a mandatory injunction particularly in light of the public interest in ensuring the Petitioner's continued operations in discharging its constitutional and statutory functions, but it was also the case that the 1st and 2nd Respondents were trying to steal a march on the Petitioner.
  14. The Court was granted powers to issue conservatory orders in constitutional petitions under article 23 (3)(c) of the Constitution and rule 23 of the Constitution of Kenya (Protection of Rights and Fundamental Freedoms) Practice and Procedure Rules 2013. The applicable principles for the grant of a conservatory order were that the Applicant ought to demonstrate an arguable prima facie case with a likelihood of success and that in the absence of the conservatory orders he is likely to suffer prejudice. Further, the Court should decide whether a grant or a denial of the conservatory relief will enhance the constitutional values and objects of a specific right or freedom in the Bill of Rights and whether if an interim conservatory order is not granted, the Petition or its substratum will be rendered nugatory. Lastly, that the Court should consider the public interest and relevant material facts in exercising its discretion whether to grant or deny a conservatory order.
  15. The outstanding prayers in the application sought conservatory orders and a mandatory injunction restraining the 1st, 2nd and 4th Respondents from using, withdrawing or transferring the appropriated funds in the County Revenue Fund which had not been remitted to the Petitioner. However, the applicable procedure as to withdrawal of funds by the Petitioner had not been shown to have been complied with as regards those funds, particularly the approval required by the 4th Respondent. Those prayers therefore had to wait full hearing of the Petition to confirm if and when applicable procedures had been met.

Application partly allowed, Preliminary Objection dismissed

  1. Preliminary Objection dated December 18, 2017 and filed by the 1st and 2nd Respondents on the same date dismissed with costs to the Petitioner.
  2. Notice of Motion dated December 4, 2017 and filed on the same date by the Petitioner allowed only to the extent of the following:
    1. Mandatory injunction issued compelling the 1st and 2nd Respondents jointly and severally, their agents or any person acting under their behest to within 14 days from the Ruling’s date approve the withdrawal of, release, and remit a total sum of Kshs.79,254,659/= which consisted of the sum of Kshs.63,248,046/= for the recurrent budget and kshs.16,006,613/= for the development budget requisitioned for by the Petitioner and approved by the 4th Respondent.
    2. Conservatory order restraining and prohibiting the 1st, 2nd and 4th Respondents jointly and severally, their agents or any person acting under their behest from using, interfering, utilizing, withdrawing and or transferring all the funds in the County Exchequer Account specifically approved but for not remitted to the Petitioner outstanding at Kshs 165,183,979.00 pending the hearing and determination of the Petition or until the same had been remitted to the Petitioner was denied.
    3. Grant of a mandatory order compelling the Respondents jointly and severally, their agents or any person acting under their behest to release and remit funds for both the recurrent and development budgets as requisitioned at the beginning of the financial year and to timeously make monthly remittances pending the hearing and determination of the Petition and awarding costs of the Application to the Petitioner to be canvassed and determined together with the Petition filed therein on December 4, 2017.
  3. Costs of the Notice of Motion to be in the cause.

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