Sections 10, 16, 23, 26 and 53 (2) (d), 2 (e), 58 and the entire part IV and V of the Work Injury Benefits Act, are unconstitutional, on grounds of violating the doctrine of separation of powers and fundamental rights and freedoms.
Juma Nyamawi Ndungo & 4 others v Attorney General; Mombasa Law Society (Interested Party)
Constitutional Petition 196 of 2018
High Court at Mombasa
E K Ogola, J
June 10, 2019
Reported by Beryl A Ikamari
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Constitutional Law-fundamental rights and freedoms-enforcement of fundamental rights and freedoms-rights to property, access to justice, fair trial and equality and non-discrimination-claim that litigants had their cases pending before subordinate courts arbitrarily terminated pursuant to allegedly unconstitutional provisions in a statute-whether those litigants had their rights to property, access to justice, fair trial and equality and non-discrimination violated-Constitution of Kenya 2010, articles 40, 48, 50 & 27.
Constitutional Law-interpretation of provisions of the Constitution-separation of powers and authority to exercise judicial power-whether judicial power could be exercised by an entity, that was an appointee of the Executive and was not a court or a tribunal within the Judiciary-whether the office of the Director of Work Injury Benefits could exercise judicial power without contravening the Constitution-Constitution of Kenya 2010 article 159(1); Work Injury Benefits Act, No 13 of 2007, sections 10, 16, 23, 26 and 53 (2) (d) and 2 (e).
Jurisdiction-jurisdiction of the High Court-jurisdiction to interpret the Constitution and to determine whether statutes and actions undertaken under the Constitution were constitutional-whether the High Court could entertain a petition which was about the constitutionality of an employment and labour law statute-Constitution of Kenya 2010, article 165(3) (b) & 165(3)(d).
Civil Practice and Procedure-res judicata-applicability of the doctrine of res judicata-similarity between issues raised in a petition before court and issues that had already been determined by a superior court-claim that issues concerning the constitutionality of the Work Injury Benefits Act had already been determined by the Court of Appeal-whether the doctrine of res judicata would prevent the High Court from hearing and determining the petition-Civil Procedure Act (Cap 21), section 7.
Jurisdiction-jurisdiction of Magistrates' Courts-jurisdiction of Magistrates' Courts in relation to work injury claims-where the Work Injury Benefits Act, which was enacted in 2007, seemed to oust the jurisdiction of Magistrates' Courts in work injury claims while the Employment and Labour Relations Court Act, enacted in 2011, gave Magistrates' Court jurisdiction to handle work injury claims-whether Magistrates' Court had jurisdiction to handle work injury claims-Employment & Labour Relations Court Act, No 20 of 2011, sections 29(3) & 35; Work Injury Benefits Act, No 13 of 2007, sections 53(2) (d) and 53(2)(e).
The petitioners sought a determination relating to various constitutional issues. The first was on whether Magistrates Courts had jurisdiction to entertain claims for compensation for bodily harm arising from negligence and breach of duty at the workplace. The second was on whether the Director appointed under the Work Injury Benefits Act or any other officer appointed under the Employment Act could exercise judicial authority relating to injuries suffered at work due to negligence. Lastly, the petitioner challenged the constitutionality of various sections of the Work Injury Benefits Act including sections 10, 16, 23, 26, 28, 30, 33, 37, 51, 53(2) (d), 58(2) and the first schedule of the Act.
In the case of Attorney General v Law Society of Kenya & another  eKLR, inter alia, the Court of Appeal set aside the High Court's finding that sections 4, 16, 21(1), 23(1), 25(1) (3), 52(1) (2) and 58 (2) of the Work Injury Benefits Act were unconstitutional. The Court of Appeal, however declared that sections 7 (in so far as it provided for the Minister’s approval or exemption) and 10(4) of the Work Injury Benefits Act were unconstitutional. When the High Court made its decision on constitutionality, the repealed Constitution was in effect and the decision meant that Magistrates’ Courts could handle claims of workplace injury. In the aftermath of the Court of Appeal decision, issued after the promulgation of the Constitution of Kenya 2010, most Magistrates’ Courts declined to deal with workplace injury claims, on grounds that they did not have the requisite jurisdiction to handle them.
The petitioners were aggrieved that their cases on workplace injury which were pending before Magistrates Courts were stopped arbitrarily. Under section 58 of the Work Injury Benefits Act, the Work Injury Benefits Act had retrospective effect and section 53 of the Act established the Director who had a dispute resolution role. The net effect was that claims that were already pending before court would have to be filed afresh before the Director. Majority of the claims affected by those provisions dated back to a period in excess of 11 years meaning that they failed to meet the one year limitation period provided under section 26 of the Work Injury Benefits Act.
The petitioners argued that the retrospective application of the Work Injury Benefits Act undermined article 159 of the Constitution which provided for substantive justice and property rights recognized under article 40 of the Constitution. They said that the test of reasonability and substantive justice demanded that what was done pursuant to the legal regime that subsisted at the time the claims were lodged in court be deemed as legal.
The petitioner said that the office of the Director was yet to be operationalized and aside from the Director and his assistants being appointees of the Executive, the relevant statute did not provide for their qualifications or mode of appointment. Further the petitioner stated that the Director and his assistants, as appointees of the Executive, had the authority to receive complaints, investigate them and ultimately adjudicate over them in breach of the doctrine of separation of powers. A further allegation was that it was discriminatory for part V of the Work Injury Benefits Act to have compensation for pain and suffering as compensation that would be based on one’s income.
In general, the petitioners alleged that under the circumstances, their rights to access to justice, property, a fair trial, non-discrimination and equality and human dignity were violated.
- Whether the High Court had jurisdiction to hear and determine a petition that concerned the constitutionality of a statute whose subject matter related to employment and labour.
- Whether the petition was res judicata on grounds that the issues raised in it had already been determined by the Court of Appeal in Civil Appeal No 133 of 2011.
- Whether Magistrates Courts had jurisdiction to hear and determine claims relating to workplace injury.
- Whether it was constitutional for the office of the Director of Work Injury Benefits to exercise judicial powers, including powers of adjudication of work injury claims and assessment of damages, as provided for in sections 10, 16, 23, 26, 28, 30, 33, 37, 51, 53 (2) (d), 53 (2) (e), 58 (2) and the first schedule to the Work Injury Benefits Act.
- Whether the provisions of the Work Injury Benefits Act, in particular sections 16 and 53(2)(d), violated the doctrine of separation of powers by effectively transferring judicial power to an appointee of the Executive.
- Whether litigants that had their court cases arbitrarily terminated on grounds that subordinate courts had no jurisdiction to entertain them, had their rights to property, access to justice, fair trial and equality and non-discrimination violated.
- The petition raised allegations about the constitutionality of a statute, violation of constitutional rights, constitutionality of acts of state officers and constitutional powers of state organs. Pursuant to the provisions of article 165(3) (b) and 165(3)(d), the High Court had jurisdiction, at the first instance, to entertain the petition.
- Under the terms of article 22 (1), 22(2) and 258 of the Constitution, the petitioners had locus standi to institute the petition. The petitioners had locus standi as litigants in the subordinate courts whose cases could not proceed due to the provisions of the allegedly offending statute.
- There was disquiet as to whether the High Court had jurisdiction to declare an employment and labour statute unconstitutional. The fact that a statute was an employment and labour statute did not lessen the weight of the jurisdiction and authority granted to the Court under article 165 of the Constitution. Therefore, the Court had jurisdiction to entertain the petition and make appropriate pronouncements on the prayers sought in the petition.
- Section 7 of the Civil Procedure Act provided for the principle of res judicata. The principle of res judicata would apply when the following factors were in existence, namely;
- a previous suit in which the same matter was in issue;
- the parties were the same or litigating under the same title;
- a competent court heard the matter in issue and determined it; and,
- the issue had been raised once again in a fresh suit.
- The question raised with respect to res judicata was that the issues in the petition before court had already been determined in Civil Appeal No 133 of 2011. However Civil Appeal No 133 of 2011 related to the constitutionality of the Work Injury Benefits Act as per the terms of the repealed Constitution and any references to the 2010 Constitution by the Court of Appeal in Civil Appeal No 133 of 2011 were obiter dicta. The Court of Appeal decision did not relate to the constitutionality of the impugned statute under the 2010 Constitution. Therefore the issues in the petition before the Court differed from the issues in Civil Appeal No 133 of 2011.
- The prayers sought in the petition were much broader than what was previously sought at the High Court in petition No 185 of 2018 which was the subject of appeal in Civil Appeal No 133 of 2011. The petition before court was very deliberate, more focused and aimed at completely invalidating the Work Injury Benefits Act. It would not fall prey to the res judicata principle.
- The issue regarding the provisions of the Magistrates’ Court Act, the Employment and Labour Relations Court Act and article 260 of the Constitution as compared to the Work Injury Benefits Act had never been adjudicated upon. As compared to section 60 of the repealed Constitution, the provisions of article 1 (3) (c) and 159 of the Constitution were more comprehensive on the question as to who could exercise judicial power.
- The nature and character, or even the manner of implementation of fundamental rights constantly changed, with the result that the strict applicability of the doctrine of res judicata had to be frowned upon for the obvious reason that to do otherwise would restrict the pursuit of rights thought to be violated by potential respondents.
- Article 10 (1) (a) and 2 of the Constitution which provided for the national values and principles of governance would guide the Court in interpreting the Constitution. The Constitution was a living document, with a soul and a conscience of its own, and courts had to endeavour to avoid crippling it by construing it technically or in a narrow spirit but construe it with the lofty purposes for which its makers framed it.
- Article 159(1) of the Constitution provided that judicial authority was derived from the people and vested in and had to be exercised by the courts and tribunals established by or under the Constitution. Judicial authority was the constitutional authority vested in courts and judges to hear and decide justiciable cases and to interpret and enforce or void, statutes when disputes arose over their scope or constitutionality.
- The doctrine of separation of powers would not allow Parliament to transfer discretion to determine the severity of the punishment to be inflicted upon an individual member of a class of offenders, from the judiciary to any executive body which was not appointed under chapter VII of the Constitution.
- Under the Constitution, judicial authority could only be exercised by courts and independent tribunals. No other entity, including the Director as established under the Work Injury Benefits Act had judicial authority.
- Section 53 (1) of the Work Injury Benefits Act created the office of the Director of Work Injury Benefits. Section 53(2) (d) and (e) gave him the power to receive reports on accidents and carry out investigations into such accidents and ensure injured employees were compensated. In an adversarial system, investigation was not a judicial function, and neither was it the duty of court to ensure that all employees who suffered at the work place were compensated.
- Under section 53(2) (e) of the Work Injury Benefits Act, the Director's functions included adjudicating over injury cases and assessing damages. Those functions were purely judicial functions.
- Section 16 and 53 (2) (d) and 53 (2) (e) of the Work Injury Benefits Act entailed a usurpation of judicial power by the executive and were therefore unconstitutional. Additionally, sections 10, 23, 26, 28, 30, 33, 37, 51, 53 (2) (d), 53 (2) (e), 58 (2) and the first schedule to the Work Injury Benefits Act were unconstitutional as they promoted the exercise of judicial powers by the Director who was neither an independent tribunal nor a court.
- Pursuant to section 29(3) of the Employment & Labour Relations Court Act, various gazette notices were issued to grant jurisdiction to Magistrates’ Courts to hear and determine employment disputes. However, the subordinate courts downed their tools in work injury related claims. Even if those courts were to decline jurisdiction under the Work Injury Benefits Act, they would still have jurisdiction to entertain work injury related disputes under the Employment and Labour Relations Court Act.
- The doctrine of implied repeal was to the effect that where provisions of one Act of Parliament were inconsistent or repugnant to the provisions of an earlier Act, the later Act would abrogate the inconsistency in the earlier one. Section 35 of the Employment and Labour Relations Court Act provided that its provisions would take precedence over any other law that subsisted before its enactment on the issues set out in section 29 of the Act. The Employment and Labour Relations Court Act, which gave the Magistrates’ Courts jurisdiction in employment and labour relations disputes, had to, under the provisions of rule 7 of part 2 of the sixth schedule of the Constitution, prevail over the provisions of the Work Injury Benefits Act that seemed to deny Magistrates’ Courts jurisdiction.
- Under the doctrine of separation of powers each arm of government would perform its task independently and would enjoy safeguards against encroachment by another arm. There were three arms of government in the Constitution, namely; the Executive, the Judiciary and the Legislature.
- To the extent that the provisions of the Work Injury Benefits Act, in particular sections 16 and 53(2)(d) , sought to transfer judicial power to the Executive, or an entity that was neither a tribunal nor a court, they violated the constitutional doctrine of separation of powers and were therefore unconstitutional.
- In granting the Magistrates’ Court the jurisdiction to deal with labour and employment issues, the Legislature as set out in Nairobi Branch v Malindi Law Society C. A. No. 287 of 2016, was acting within its mandate under the Constitution. Therefore the Magistrates’ Court Act and the Employment and Labour Relations Court Act conferred upon subordinate courts the jurisdiction to try and to determine labour related disputes.
- The petitioners’ rights to property as recognized in article 40 of the Constitution were violated. The petitioner had causes of action which had been lodged in court and causes of action had been recognized as property rights because of the expected outcome of compensation.
- The refusal by Magistrates’ Courts to determine work injury claims violated the petitioners’ rights of access to justice as recognized in article 48 of the Constitution. The Magistrates’ Courts were distributed everywhere in Kenya and the provisions of section 29 of the Employment and Labour Relations Court Act were enacted specifically to promote the right of access to justice.
- The rights to a fair trial as recognized in article 50(1) of the Constitution required a fair and public hearing before a court or an independent and impartial tribunal. The office of the Director of Work Injury Benefits created under section 53 (1) of the Work Injury Benefits Act was not such a body and a trial before that Director violated the right to a fair trial.
- The petitioners' rights to have their cases heard and determined without delays as provided for in article 159 (2) (b), were violated. Delays had been occasioned by unnecessary confusion relating to the applicable legal regime.
- It was costly and expensive for the petitioners to look for the Director whose offices were unknown. Article 159 (2) (a) on the right of the petitioners to have their cases heard and determined without discrimination based on their status was violated.
- A declaration that sections 10, 16, 23, 26 and 53 (2) (d) and 2 (e) and the entire part IV and V of the Work Injury Benefits Act were ultra vires the Constitution of Kenya 2010 and were null and void to the extent that they placed judicial authority in an entity that was not part of the Judiciary.
- A declaration that sections 10, 16, 23, 26 and 53 (2) (d) and 2 (e) and the entire part IV and V of Work Injury Benefits Act violated the doctrine of separation of powers, and were therefore unconstitutional.
- A declaration that the provisions of sections 10, 16, 23, 26 and 53 (2) (d) and 2 (e) and the entire part IV and V of the Work Injury Benefits Act violated the injured employee’s right to a fair hearing as provided for under article 50 of the Constitution of Kenya, 2010.
- That the provisions of sections 10, 16, 23, 26 and 53 (2) (d) and 2 (e) and 58 of the Work Injury Benefits Act violated the injured worker’s right to property under article 40 of the Constitution of Kenya.
- That the provisions of sections 10, 16, 23, 26 and 53 (2) (d) and 2 (e) and the entire part IV and V of the Work Injury Benefits Act violated the right of access to justice and undermined the doctrine of devolution.
- Part V of the Work Injury Benefits Act violated an injured employee's right to equality, freedom from discrimination and the right to human dignity as provided under article 27 and 28 of the Constitution of Kenya, 2010.
- A declaration that the provisions of the Employment and Labour Relations Act, particularly, section 12(a), 22, 29 and 35 and section 9(b) of the Magistrates’ Court Act, by dint of article 261 (1) of the Constitution of Kenya 2010 and section 7 of schedule 6 of the Constitution, overrode all provisions in the Work Injury Benefits Act that were in conflict with them.
- Costs of the petition were awarded to the petitioners and the interested party. The costs were to be paid by the respondent.
Case Updates Issue 030/2019
|CIVIL PRACTICE AND PROCEDURE
|| Members of the National Assembly and the Senate serving in the Twelfth Parliament to be paid as those who served in the Eleventh Parliament.
Salaries Remuneration Commission v Parliamentary Service Commission & 4 others
Civil Application 9 of 2019 (UR.8/2019)
Court of Appeal at Nairobi
W Ouko, (P), Asike-Makhandia, J Otieno-Odek, JJA
May 24, 2019
Reported by Beryl Ikamari & Mathenge Mukundi
Civil Practice and Procedure-stay of execution-application for stay of execution of the judgement and decree of the High Court-guiding principles for granting stay of execution orders-claims that the intended appeal would be rendered nugatory if the stay order was not granted and it would make the public wage bill unsustainable- Court of Appeal Rules, 2010, rule 5(2) b.
By Gazette Notice 6517 dated July 7, 2017 the applicant published review of remuneration and benefits for state officers working in Senate and the National Assembly and serving in the 12th Parliament. The overall effect of the Gazette Notice was inter alia to reduce the salaries, remuneration and benefits for state officers below the remuneration and benefits of those who served in the 11th Parliament and below those of coordinate state officers serving in the Executive, Constitutional Commissions and Independent Offices.
It was alleged that a further effect of the Notice was to take away the state officer’s right to annual salary increment; the review abolished Special Parliamentary Duty Allowance for members of Parliament who had additional responsibilities. It also abolished allowances to the Leader of Majority Party, Leader of Minority Party, Chairpersons of Committees, Members of the Speakers Panel, the Chief Whip and Minority Whip.
Aggrieved by the reduction of salaries, allowances and other remuneration benefits the 1st respondent filed a constitutional petition before the High Court seeking an order of certiorari to quash the gazette notice. In a judgment delivered on December 10, 2018, the High Court issued an order of certiorari quashing Gazette Notice 6517 published on July 7, 2017.
The applicant filed a notice of appeal dated December 13, 2018 and later filed a notice of motion dated January 8, 2019 seeking an order to stay the judgment of the High Court pending hearing and determination of the intended appeal.
- What were the guiding principles for granting a stay of execution under rule 5(2) (b) of the Court of Appeal Rules, 2010?
- Whether it was in public interest to grant the stay orders as paying members of the National Assembly and the Senate using 2013 Gazette Notice 2886 would make the public wage bill unsustainable. Read More..
- The jurisdiction of the Court under rule 5(2) (b) of the Court of Appeal Rules was not only original but also discretionary. The two principles guiding the Court in exercise of that jurisdiction were well settled. For an applicant to succeed he had to not only show that his appeal or intended appeal was arguable but also that unless the court granted him an injunction or a stay the success of that appeal would be rendered nugatory.
- The applicant had annexed a draft memorandum of appeal. Several grounds had been pointed out as errors on the part of the judge. It was contended that the High Court erred in holding that there was procedural impropriety on the part of SRC in promulgating the 2017 Gazette Notice, that the High Court erred in reviving the 2013 Gazette Notice on salaries and remuneration of state officers and the judge erred in legitimizing payment of salaries and allowances to a level that could not be sustained by the public wage bill. The grounds of appeal showed that the intended appeal was arguable.
- The legal duty was on the applicant to prove the allegation that an appeal would be rendered nugatory because the respondent would be unable to pay back the decretal sum. It would be unreasonable to expect the applicant to know in detail the resources owned by the respondent or lack of them. Once the applicant expressed that the respondent would be unable to pay back the decretal sum the evidential burden shifted to the respondent to show what resources he had since that was a matter within his knowledge. The respondent was unable to discharge his burden.
- There was no evidence by way of affidavit that state officers and members of Parliament would not be in a position to refund any monies paid. The applicant had not shown why it alleged that the members of Parliament would be incapable of refunding the sums paid.
- One of the key objectives in granting an order of stay was to preserve status quo pending hearing and determination of an intended appeal. The existing status quo was that members of Parliament were paid using the 2013 Gazette Notice. Granting a stay order would reverse the status quo. It was in the interest of justice that a stay order should not be granted in the matter in order to preserve and maintain the status quo. The applicant had not satisfied the Court that the intended appeal would be rendered nugatory if stay order was not granted.
Application dismissed with no orders as to costs.
|CIVIL PRACTICE AND PROCEDURE
|| Senate has no constitutional power to pass a resolution to stop the transfer of funds, constituting national revenue allocations, to County Governments.
Council of Governors & 5 others v Senate & another
Civil Appeal 204 of 2015
Court of Appeal at Nairobi
Asike-Makhandia, D K Musinga, A K Murgor, Otieno-Odek & S Kantai, JJA
June 7, 2019
Reported by Beryl A Ikamari
Civil Practice and Procedure-institution of suits-suits against the Government-necessary parties in a suit against the Government-the Attorney General as a party to a suit by or against the Government-where different levels of government were the parties to a suit and it was impractical for the Attorney General to be a party in place of the disputing parties-whether the Attorney General was a necessary party to the suit in such circumstances-Government Proceedings Act (Cap 40), section 12.
Civil Practice and Procedure-institution of suits-suits against the Government-issuance of 30 days' notice of intention to institute proceedings against the Government-effect of failure to issue the notice-whether without the issuance of that notice, the High Court had no jurisdiction to entertain a suit-Government Proceedings Act (Cap 40), section 13A.
Constitutional Law-Parliament-parliamentary privileges and immunities-duty of the High Court to interpret the Constitution and determine whether actions done by Parliament were constitutional-whether parliamentary privileges and immunities would prevent the High Court from hearing a suit which challenged the validity of a resolution passed by the Senate.
Constitutional Law-Parliament-Senate-powers of the Senate to summon persons-where the Senate summoned governors to respond to queries relating to the financial management of their county governments, in order undertake oversight over the national resource allocation to county governments-whether the Senate had the mandate to summon the county governors-Constitution of Kenya 2010, article 96(3); County Governments Act, No 17 of 2012, section 30 (3) (f).
Constitutional Law-Parliament-Senate-resolutions passed by Senate-constitutionality of the resolutions passed by Senate-where Senate passed a resolution requiring the Cabinet Secretary for the Treasury to stop the transfer of funds to certain county governments and for the Controller of Budgets to disallow withdrawal of public funds by certain County Governments-whether the Senate had constitutional power to pass such a resolution-Constitution of Kenya 2010, articles 225 & 228(4); Public Finance Management Act, No 18 of 2012, sections 96(1), 93 & 94.
Constitutional Law-devolution-county government resources-extent of the oversight role of the Senate with respect to national revenue allocation made to the county governments-whether oversight over national revenue allocation made to county governments was within the exclusive competence of the Senate while oversight over county revenue from sources other than the national revenue allocation, including grants and county government fees, was within the competence of the county assemblies-Constitution of Kenya 2010, article 96(3).
On February 8, 2014, the Senate Committee on Finance, Commerce and Economic Affairs, summoned 15 County Governors to respond to queries related to a report of the Controller and Auditor General for the financial year ended 2012/2013. All of the Governors, except four appeared before the Committee. The four were aggrieved by the summons and they filed High Court Petition No. 8 of 2014, International Legal Consultancy Group v The Senate and the Clerk of the Senate. The High Court made a determination that it was within Senate's mandate to summon County Governors and the County Executive members of finance. Following the determination, Senate issued fresh summons to the four County Governors but they refused to appear before Senate.
Senate responded to the refusal of the four Governors to honour summons through measures that would affect the finances of the concerned County Governments. Senate passed a resolution recommending that under section 96 of the Public Finance Management Act, the Cabinet Secretary for the Treasury should stop the transfer of funds to the concerned County Governments. They also urged the Controller of Budgets to decline to approve withdrawal of public funds by those County Governments. The affected county governors filed a petition seeking various reliefs against the resolution of Senate.
The High Court's finding was that Senate could issue summons for the members of the County Executive Committee and the chief officers responsible for finance in counties to answer queries on county government finance. Additionally, the High Court found that the Senate did not have the constitutional powers to direct the National Treasury and the Controller of Budget not to release funds to the counties without first complying with the provisions of article 225 of the Constitution, and issued an order of certiorari to quash the resolution of the Senate issued on August 7, 2014. An appeal was lodged at the Court of Appeal against the High Court decision.
In an appeal filed at the Court of Appeal, the appellants contended that provisions of the Constitution had been misinterpreted and that there had been a failure to appreciate devolution and the distinction between the two levels of government which would have led to the finding that Senate had no mandate to summon county governors or accounting officers of a county. The appellants also stated that the Constitution, with respect to the oversight role of the County Assemblies over national revenue allocated to counties had been misinterpreted. They explained that county assemblies had an oversight role in relation to revenue allocated to counties and that it was incorrect to find that the National Assembly and the Senate had exclusive oversight functions over revenue allocation.
The respondent filed a cross-appeal against the decision of the High Court to issue a certiorari to quash the Senate's resolution that the Cabinet Secretary for the Treasury should stop the transfer of funds to certain counties. They also questioned the finding that Senate had no mandate to direct the Controller of Budgets not to allow certain counties to withdraw public funds.
- Whether the High Court lacked jurisdiction over a suit involving the Government as a party where there was failure to comply with section 12 of the Government Proceedings Act, which required that civil proceedings by or against the Government had to be instituted by or against the Attorney General.
- Whether the High Court's jurisdiction was ousted by a failure to comply with section 13A of the Government Proceedings Act which required the issuance of 30 days' notice of intention to institute proceedings against the Government.
- Whether parliamentary privileges and immunities could prevent the High Court from entertaining a suit in which the legal validity of a resolution of the Senate was in question.
- Whether the Senate had the constitutional mandate to summon governors and county accounting officers to account for resource management by the County Government.
- Whether the Senate had power to stop the transfer of public funds, which were part of the national revenue allocated to counties, by the Treasury and the Controller of Budgets to county governments.
- Whether the National Assembly and the Senate had an exclusive oversight role, to the exclusion of County Assemblies, as concerned the management of county resources. Read More..
- Without jurisdiction, a court had no mandate to hear and determine a suit. The jurisdictional issues raised by the respondents related to the effect of failure to comply with the requirements of sections 12 (1) and 13 A of the Government Proceedings Act and whether parliamentary privileges and immunities should have prevented the Court from entertaining the suit.
- Section 12 (1) of the Government Proceedings Act specified that civil proceedings by or against the Government had to be instituted by or against the Attorney General. Article 156 (4) of the Constitution and section 5 (1) (i) of the Office of the Attorney General Act were to the effect that the Attorney General had the duty of representing the National Government in all civil and constitutional matters. There was a distinction between the National Government and the County Governments. However, section 12 of the Government Proceedings Act envisioned a situation where the Attorney General would represent both levels of Government.
- In situations where different levels of governments were disputing parties, it was unclear which party the Attorney General would institute the suit for and whether after instituting suit a suit, the Attorney General could also defend the suit. A strict application of section 12 of the Government Proceedings Act in the circumstances of the case could give rise to an absurdity that was not intended by the Constitution. Therefore, for purposes of the appeal, it was not mandatory for the Attorney General to be the plaintiff or the defendant and failure by the Attorney General to represent the parties to the suit would not render the suit incompetent.
- Failure to issue the 30 days’ notice required under section 13A of the Government Proceedings Act would not render a suit incompetent. The decision of the High Court that section 13A of the Government Proceedings was unconstitutional had not been overturned on appeal and another court of concurrent jurisdiction, Joseph Nyamamba v ILR  eKLR, endorsed the decision.
- Notwithstanding the doctrine of separation of powers, where parliamentary proceedings and decisions violated the Constitution or the statutes, the courts would lift the veil of parliamentary privilege to stop unconstitutional excesses.
- Whether the Senate resolution on stoppage of transfer of funds to counties where governors failed to honour Senate’s summons, was lawful depended on a consideration of the relevant legal provisions. Under article 225 of the Constitution, it was the Cabinet Secretary responsible for finance that could stop the transfer of funds to a state organ or public entity. However, not more than 50% of the funds could be affected, and transfer of funds could be stopped only for sixty days and with parliamentary approval being granted within 30 days of the making of the decision. Section 96 (1) of the Public Finance Management Act stipulated that the Cabinet Secretary could stop the transfer of funds, in accordance with article 225 of the Constitution, where a county government was in serious or persistent breach of its obligations or financial commitments.
- The power to stop the transfer of funds was held by the Cabinet Secretary for Finance. In passing a resolution for the stoppage of transfer of funds, the Senate had overstepped its mandate. Similarly, in making that resolution, Senate usurped the powers of the Controller of Budgets as stipulated under article 228 (4) of the Constitution.
- It did not matter that what was quashed was a resolution, opinion or proposal and not a decision. What mattered was that the resolution had no basis in law as it did not conform to the requirements of the Constitution and sections 93 and 94 of the Public Finance Management Act. It was therefore unlawful and unenforceable. Therefore, the High Court rightfully issued orders of certiorari to quash the resolution in question.
- Article 259 (1) of the Constitution stipulated that the Constitution should be interpreted in a manner that promoted its purposes, values and principles, advanced the rule of law, and human rights and fundamental freedoms in the Bill of Rights, permitted the development of the law and contributed to good governance. Therefore, in construing the Constitution, its provisions had to be given a holistic and contextual interpretation.
- The entire Constitution had to be read as an integrated whole and no one particular provision could destroy the other, all provisions bearing on a particular issue should be considered together to give effect to the purpose of the instrument. The Constitution should be given a generous and purposive interpretation. The Constitution should be read as a whole in light of its history, the issues in dispute and the prevailing circumstances.
- To determine the nature, scope and extent of the oversight function of the Senate over the county governments, an appreciation of their relationship within the context of devolution was essential. Devolution under the Constitution was anchored on the transfer of various functions and resources from the National Government to the counties and their governments. Articles 10, 174, 175 and chapter 6 of the Constitution specified the values, objects and principles of devolution. Under article 174 of the Constitution, the objectives of devolution were inter alia, to promote national unity, to cede self-governance to the people and enhance their participation in the exercise of power, to recognize the rights of communities to manage their own affairs, to promote social and economic development and to ensure equitable sharing of national and local resources.
- Article 96 of the Constitution provided for the responsibilities of Senate. The distinct role of the Senate was to protect and oversee devolution.
- Article 176 (1) of the Constitution provided for the establishment of the county governments and a county executive for each county. Article 185 established the County assemblies and set out their responsibilities. The responsibilities of county assemblies included law making, exercising oversight over the county executive committee and any other county executive organs and also receiving and approving plans and policies on management and exploitation of the county's resources and the development and management of infrastructure and institutions.
- County executive committees were established under article 183 of the Constitution. Their functions, in summary entailed providing the County Assembly with full and regular reports on matters relating to the County.
- The relationship between Senate at the national level and the county governments, at the county level, was intended to ensure that counties were protected and represented by the Senate at the national level. The Senate had a role in the division and sharing of national revenue between the national and county governments, as prescribed by articles 202 and 203 of the Constitution. Senate also had the role of supervising the usage and management of the resources in question to ascertain compliance with relevant laws. Senate served as a link between county governments and the National Government. The link ensured that counties were not isolated, ignored or starved of national revenue, while, at the same time, allowing for enquiry by the Senate into the use and management of such resources by the counties.
- The Oxford English Dictionary defined “oversight” as “the action of overseeing or supervising”. The same dictionary defined “accountable” as “required or expected to justify actions or decisions; responsible, able to be explained or understood”. Of more relevance to the public sector was the fact that the concept of “accountability” primarily involved entrusting public resources to government officials, who then had a responsibility to render accounts.
- The Senate’s role was to oversee or supervise the management and expenditure of national revenue allocated to the County, and it included a duty to seek justification for expenditure incurred. While the accounting officer’s role under article 229 of the Constitution, was the rendering of county revenue accounts, monitoring, evaluating and overseeing the management of their public finances, promoting transparency, effective management and accountability with regard to the use of their finances amongst other duties. The roles were dissimilar-one involved overseeing of accounts and the other involved undertaking the process of accounting. The Senate's role could not be equated to the accounting role of an accounting officer.
- Article 96 (3) of the Constitution provided that one of Senate's responsibilities was oversight over national revenue allocated to the counties. Further, in accordance with article 217 of the Constitution, Senate had the responsibility of ensuring that county governments received revenue from the National Government and also the duty of supervising the usage and management of the funds. That supervision would entail an interrogation of accounts and audit reports, including the Auditor General’s report to satisfy itself that expenditure was both authorised and justified.
- Article 96 (3) of the Constitution restricted the Senate’s oversight role to the supervision of national revenue allocated to counties, and it was clear that the provision did not authorize the Senate to oversee county resources other than revenue from the National Government. That was noteworthy as the County Government Act and the Public Finance Management Act allowed county governments to raise revenue from grants, donations and other sources. The County Assembly had an oversight role in relation to the management and expenditure of locally generated revenues.
- There were two levels of oversight in relation to county resources. At the national level, the Senate had oversight over national revenue and at the county level, the county assemblies retained oversight over revenues generated within the county. Those oversight roles were intended to be separate and distinct. Under article 6 (2) of the Constitution, the two distinct levels of government were to complement each other.
- Article 229 (2) of the Constitution provided that the accounting officer of a national public entity was accountable to the National Assembly for its financial management, and the accounting officer of a county public entity was accountable to the County Assembly for its financial management. The duties of an accounting officer were provided for in section 147 of the Public Finance Management Act. It was clear that a county accounting officer was accountable for the management of finances at the county level and it was not provided that he was accountable to the Senate. However, such an accounting officer could appear before the Senate with the Governor and the Member of the County Executive Committee responsible for matters of finance. Appearing before Senate was not the same thing as being accountable to the Senate. The High Court correctly made the finding that it was proper, legal and constitutional for members of the executive committees and the Chief Officers responsible for finance to appear before the Senate or any of its committees.
- The Constitution made provision for oversight of county revenue at two levels; by the county assemblies in respect of revenue generated at the county level, and by the Senate over national revenue allocated from the National Government to the county governments as stipulated by article 96 (3). County Assemblies had no oversight in relation to national revenue allocation and if the Constitution intended for such oversight to exist, it would have said so.
- Under section 30 (3) (f) of the County Governments Act, the Governor had to be accountable for the management and use of county resources. Additionally, under article 96 (3) of the Constitution the Senate was charged with oversight over national revenue. Therefore, the inescapable conclusion was that the Governor as the chief executive of the County Government was accountable to the Senate for the management of the portion of county resources that comprised of national revenue horizontally allocated by the Senate to the County. It was the Governor who would have to answer queries in connection with that revenue.
- Article 125 of the Constitution, set out in clear and unqualified terms that either House of Parliament could summon any person to appear before either House to give evidence, or provide information on matters in which they were constitutionally mandated to inquire into. Such a person would include a governor. Therefore, the High Court was right in finding that Senate was within its constitutional mandate when it summoned the recalcitrant governors to address the audit queries, and matters related to utilization of national revenue allocated to their counties.
- There could be instances where the Governor would be unable to provide sufficient information concerning the management and usage of national revenue. The solution under article 179(6) of the Constitution, which stipulated that members of an executive committee were accountable to the Governor, was that a technocrat such as an officer in charge of finance could appear before Senate with the Governor and assist in providing information required by Senate.
- Article 229 (7) and (8) of the Constitution, required the Auditor General to submit audit reports to Parliament or the relevant county assembly, and within three months after receipt of the report, Parliament or the County Assembly was required to debate and consider the report and to take appropriate action. In fulfilment of that requirement, Senate would table and debate its own accounts and also discharge its oversight mandate by debating 47 audited county reports, if need be. Additionally, county assemblies, in exercise of their oversight mandate were required to debate their respective reports within the stipulated period. The requirement that the process would have to be undertaken within three months placed enormous pressure on Parliament and the county assemblies to comply with the stringent constitutional timeline. That was so particularly because the Senate could call upon a governor to answer queries with respect to audited reports.
- Article 189 (1) (a) and (2) of the Constitution required both levels of government to respect the constitutional status and institutions of government at either level and to co-operate in the performance of functions and exercise of power. For purposes of co-operation, they could set up joint committees and joint authorities. Effectively, Parliament and county assemblies could overcome the operational quagmire of considering the audited accounts by working together to develop frameworks and guidelines to assist them carry out their respective responsibilities.
- The issue concerning the taking over of the assets and liabilities of the defunct local governments by the county governments and whether the High Court erred when it declined to order the governors to respond to queries on the financial affairs of defunct local authorities during the financial year 2012/2013, were not in the pleadings and neither did the parties canvass them during submissions. As such the issues were not competently before the Court for determination. The High Court misdirected itself when it deliberated upon issues that were not before it.
Appeal and cross-appeal dismissed.
||Administration of Political Parties Fund
Orange Democratic Movement (ODM) v National Treasury & 3 Others  eKLR
Civil Appeal No. 15 of 2018
Court of Appeal at Nairobi
E.M Githinji, D.K Musinga & J.O Odek, JJA
June 7, 2019
Reported by Chelimo Eunice
Constitutional Law - political parties – funding of political parties - what was the rationale, nature and extent of public funding of political parties - what was the source of moneys in the Political Parties Fund - how was the Political Parties Fund distributed - Constitution of Kenya, 2010, article 221; Political Parties Act, sections 24 (1) (a) and 25(1).
Statutes – interpretation of statutes – Political Parties Act – interpretation of sections 24(1)(a) and 25(1) of the Political Parties Act on the allocation, appropriation and distribution of the Political Parties Fund – what was the criteria and formula for ascertaining and determining the specific amount of monies to be allocated and appropriated to the Political Parties Fund - whether the obligation to allocate and appropriate a minimum of 0.3% of the national revenue to the Political Parties Fund and to distribute the same as required under sections 24 (1) (a) and 25(1) of the Political Parties Act was mandatory- when did the statutory duty to allocate, appropriate and distribute the Political Parties Fund started to run – whether arrears were payable under section 25 (1) (a) of the Political Parties Act - Constitution of Kenya, 2010, article 221; Political Parties Act, sections 24 (1) (a) and 25(1).
Judicial Review – judicial review proceedings –judicial review orders - whether judicial review proceedings were concerned with liquidated claims - order of mandamus – what was the scope of an order of mandamus - when could an order of mandamus issue – whether an order of mandamus could issue against the national assembly to do that which it was enjoined by statute to do -whether the appellant had the locus standi to demand enforcement of the provisions of sections 24 and 25 of the Political Parties Act on the allocation, appropriation and distribution of the Political Parties Fund – whether the appellant’s right to the monies stipulated under section 25 (1) (a) of the Political Parties Act existed on the date the petition was filed before the trial court - Political Parties Act, sections 24 and 25.
Law of Equity – principles of equity - whether equitable principles would be applied in a matter of implementation and obedience to a statutory duty - whether equity could override an express statutory duty - where there was no statutory exception to the obligation to abide by a statutory obligation.
In the 2013 general election, the appellant garnered 40% of the votes cast in the general election. Ensuing from this outcome, it asserted that it was entitled to 40% of the sum of 95% from the monies due and owing to the Political Parties Fund (the Fund). It sought from the trial court an order of mandamus to compel the respondents to allocate, appropriate and disburse to it a specific sum of money being the arrears that the appellant would have been entitled to had the respondents appropriated the money in each of the five financial years, from 2012 to 2016.
The respondents opposed the application, arguing among others, that an order of mandamus could not issue; that the prayer for mandamus as sought by the appellant contravened the doctrine of separation of powers and that judicial review was a remedy in administrative law challenging administrative actions of a public body while the instant application did not challenge any administrative action. The trial court declined to grant the sought order of mandamus. Aggrieved by the decision, the appellant lodged the instant appeal.
- What was the rationale, nature and extent of public funding of political parties?
- What was the source of moneys in the Political Parties Fund and how was the Fund distributed?
- Whether the obligation to allocate and appropriate a minimum of 0.3% of the national revenue to the Political Parties Fund and to distribute the same as required under sections 24 (1) (a) and 25(1) of the Political Parties Act respectively was mandatory.
- Whether an order of mandamus could issue against the national assembly to do that which it was enjoined by statute to do.
- Whether there was limitation period for enforcement of the statutory duty on allocation, appropriation and disbursement of the Political Parties Fund as imposed by section 24(1)(a) and 25 (1)(a) of the Political Parties Act, and when did that duty started to run.
- Whether equitable principles would be applied in a matter of implementation and obedience to a statutory duty and whether equity could override an express statutory duty.
- Whether judicial review proceedings were concerned with liquidated claims and whether a judgment for a liquidated sum could be entered in a judicial review application. Read More...
Relevant provisions of the Law
Political Parties Act;
Sources of moneys in the Fund are such funds not being less than zero point three per cent of the revenue collected by the national government as may be provided by Parliament;
Section 25 (1);
The Fund shall be distributed as follows—
(a) eighty per cent of the Fund proportionately by reference to the total number of votes secured by each political party in the preceding general election;
(aa) fifteen per cent of the Fund proportionately to political parties qualifying under paragraph (a) based on the number of candidates of the party from special interest groups elected in the preceding general election; and
(b) five per cent for the administration expenses of the Fund.
Per J.O Odek & D.K Musinga, JJA;
- Public funding of political parties was a controversial and divisive issue in any democracy. There was a delicate balance between ensuring accountability and transparency and allowing political parties to be adequately resourced to carry out their mandate of representing citizens. The rationale for public funding of political parties was a policy, governance and political issue. The nature and extent of funding was determined politically and thereafter given legal foothold through legislative enactment.
- Political Parties Act (the Act) was enacted and assented to on August 27, 2011 and its commencement date was November 1, 2011. Section 23 of the Act established a Political Parties Fund (the Fund) which was administered by the Registrar of Political Parties (the 3rd respondent). Section 24 (1) (a)of the Act made provisions on the sources of moneys in the Fund, whereas, section 25 (1)of the Act dealt with distribution of the Fund.
- An order of mandamus lay against a public body that had duty to perform a certain act and had failed to do so. Section 24 (1) (a) of the Act specified that the Fund ought to have such funds not being less than zero point three per cent of revenue collected by the national government as may be provided by parliament. Section 25 (1) (a) of the Act enacted, legalized and provided the formula for distribution of the Fund. The Fund had to be distributed ninety-five per cent proportionately by reference to the total number of votes secured by each political party in the preceding general election.
- A literal reading of article 221 of the Constitution as read with section 24 (1) (a) of the Act demonstrated that parliament was under an obligation to allocate and appropriate monies to the Fund. In addition, the Cabinet Secretary responsible for Finance (the 2nd respondent) was under a constitutional obligation to submit to the national assembly (the 4th respondent) estimates of revenue and expenditure of the national government for the next financial year. The allocation of 0.3 % of the national revenue to the Fund was mandatory. It was manifest that the duty to table revenue and expenditure estimates before the 4th respondent as well as the duty to allocate and appropriate was both a constitutional and statutory duty bestowed upon the 2nd respondent and the 4th respondent respectively.
- Whereas section 24 (1) (a) of the Act used both words, shall and may, the use of shall connoted mandatory nature of the duty to allocate and appropriate a minimum of 0.3 %. The use of the word may denoted the discretionary nature of the 4th respondent to determine the upper limit of allocation and appropriation of monies for the Fund. The section gave the 4th respondent discretion and latitude to determine the upper limit of allocation and appropriation every financial year. The lower limit, the minimum allocation and appropriation, had been set by statute at 0.3% of the total revenue collected by the national government and it being a statutory obligation was not negotiable. The 4th respondent had a statutory obligation in each financial year to allocate, appropriate and disburse to the Fund a minimum of 0.3% of the revenue collected by the national government. The minimum amount was a statutory obligation that was mandatory, not discretionary.
- Courts had to restrain themselves in order not to trespass onto that part of the legislative field which had been reserved by the Constitution, and for good reasons, to the legislature. It was not the function of courts to interfere with the internal arrangements of parliament unless it could be shown that it had violated the Constitution. Courts would hesitate to enter into the arena of merit review of a constitutionally mandated function by another organ of state that had proceeded with due regard to procedure.
- For an order of mandamus to issue, the applicant had to have a legal right to the performance of a legal duty. The legal duty had to be of a public nature. Mandamus would not issue where to do or not to do an act was left to the discretion of the authority. Mandamus would not issue to a legislature to forbid it from passing legislation repugnant to fundamental rights. That notwithstanding, mandamus was a remedy against defects of justice and it would issue that justice would be done in all cases where there was a specific legal right and no specific legal remedy for enforcing that right. It would issue in cases where although there was an alternative legal remedy, yet that mode of redress was less convenient, beneficial and effectual.
- For mandamus to issue, the right to be enforced had to be subsisting on the date of the petition. If the interest of the petitioner had been lawfully terminated before that date, the petitioner was not entitled to mandamus. The appellant’s right to the monies stipulated under section 25 (1) (a) of the Act existed on the date the petition was filed before the trial court. Its right to the monies continued to subsist on the date of the judgment. Further, both the 2nd and 4th respondents had a constitutional and statutory duty enacted and bestowed upon them by virtue of article 221 of the Constitution and section 24 (1) (a) of the Act. The appellant was one of beneficiaries of the statutory funds to be distributed pursuant to section 25 (1) (a) of the Act. The allocation, appropriation and distribution of the Fund was a duty of a public nature and the appellant not only had a right to performance of the public duty but was also a beneficiary of the performance. The appellant had locus standi and was well suited to demand enforcement of the provisions of sections 24 and 25 of the Act.
- A court could not inquire into and issue a judicial review order in relation to internal parliamentary affairs or procedural irregularities. However, a judicial review order, including mandamus could issue when it was proven that parliament involved itself in a substantive statutory illegality or unconstitutionality.
- A specific statutory duty had been bestowed upon the 4th respondent and it was within the jurisdiction of a court of law to pronounce and declare the law as it was. If the law was couched in mandatory terms, as it was in the instant matter, mandamus could issue against the 4th respondent. In such an event, the order of mandamus would compel the 4th respondent to do that which it was already enjoined by statute to do. The unique and mandatory statutory obligation under section 24(1)(a) of the Act requiring the 4th respondent to allocate not less than 0.3% of national revenue to Fund conferred competence and jurisdiction to the court to issue mandamus against the 4th respondent.
- There was no limitation period for enforcement of the statutory duty imposed by section 24(1)(a) of the Act on the 4th respondent. There was evidence on record that as from the financial year 2012/13, the statutory duty to allocate the minimum of 0.3 % had not been fully complied with. There was a continuing failure by the 2nd and 4th respondents to implement the statutory duty enacted and imposed by section 25 (1) (a) of the Act.
- The continuing failure to allocate and appropriate the statutorily mandated 0.3% was evident through consecutive failure each financial year to allocate and appropriate the minimum stipulated amount of money. In that regard, there was a continuing failure to perform the statutory obligation and the concept of delay did not apply. The trial court erred in finding that there was delay in instituting the suit against the respondents. Failure on the part of the trial court to find that the 1st, 2nd and 4th respondents had violated statutory duty on account of delay was tantamount to condoning and legalizing statutory violation. That could not be overlooked.
- The trial court erred in invoking the equitable principle, delay defeats equity. The issue was implementation and obedience to an express statutory duty stipulated in section 25 (1) (a) of the Act. Equity could not override an express statutory duty. If any exception, excuse or exculpatory defence was to be invoked to explain or justify non-performance of a statutory obligation, such an exception had to expressly be provided in the statute creating the obligation. There was no statutory exception to the obligation to abide by section 25 (1) (a) of the Act.
- The duty of the 1st, 2nd and 4th respondent to comply with section 25 (1) (a) of the Act started to run from the financial year subsequent to the commencement date of the Act. The commencement date of the Act was November 1, 2011 and the subsequent financial year was 2012/13. The continuing duty of the 4th respondent to allocate the stipulated 0.3% was a duty which subsisted every financial year unless and until parliament amended the section. The appellant was entitled to all the monies including any arrears due under section 25 (1) (a) of the Act from the fiscal year 2012/13 which was the subsequent fiscal year after commencement of the Act. In so finding, the order of mandamus issued was not essentially retrospective, it merely affirmed that the statutory duty bestowed under section 25 (1) (a) of the Act had to be implemented and enforced from the date when parliament stated it should be implemented.
- Section 25 (1) (a) of the Act provided a formula to ascertain and determine the specific amount of monies to be allocated and appropriated to the Fund. Pursuant to the section, what appeared to be an uncertain sum was made certain by the two criteria stipulated in the section. The first criterion was the minimum 0.3%; and the second criterion was revenue collected by the national government. Those two criteria made the monies due to the Fund ascertainable. It made what was uncertain certain.
- The criteria set out in section 25(1)(a) of the Act was a formula for distribution and payment in arrears of monies in the Fund. It was an arrears formula because the revenue had first to be collected by the national government and then allocated, appropriated and disbursed in the following fiscal year. One could not determine the exact amount of revenue collected until the end of the financial year. It was that reality that made the formula in section 25(1)(a) of the Act to be an arrears formula. Being an arrears formula, the trial court erred in holding that arrears were not payable under section 25(1) (a)of the Act.
- Judicial review proceedings were concerned with the process, not merits of a decision and above all, judicial review was not generally concerned with liquidated claims. Ordinarily, liquidated sums were claimed by way of plaint. Even in claims for violation of constitutional principles or fundamental rights, it was declaratory orders that issue and not judgment for liquidated claims. A separate suit by way of a plaint had to be filed to claim compensation for damages for violation of a constitutional right.
- The sine qua non for issuance of a writ of mandamus was the existence of a statutory or a public duty devolving upon the person or the body against whom the said writ was directed. Equally, along with a public duty, there had to coexist a corresponding right in the petitioner which would entitle him to claim the enforcement of the said statutory public duty by way of mandamus. In a contentious claim for a liquidated sum, it could hardly be said that there devolved on one a statutory or a public duty to pay money or that there was an unequivocal right to receive a disputed sum.
- The monies to be allocated and appropriated by the 4th respondent and to be paid into the Fund was neither a claim for damages in tort nor a claim for breach of contract. The sums due under section 25 (1) (a) of the Act were statutory funds. A claim for payment of statutory funds due from a person with the specific statutory obligation to pay need not necessarily be by way of plaint. If the sum was certain, ascertainable and indisputably due and owing, judgment could be entered and mandamus could issue for the undisputed liquidated sum. However, the scope of mandamus to enforce a liquidated claim was limited. The function of mandamus was to command and execute, not to inquire and adjudicate. Mandamus was not to establish a legal right but to enforce one. It was not to be issued when the liquidated claim was first to be established and then adjudicated upon before it could be enforced.
- The sum prayed for in memorandum of appeal was not undisputably due and owing. Noting that the total revenue collected by the national government was a disputed amount in the matter, judgment could not be entered in favour of the appellant in the sum claimed. Notwithstanding that finding, the appellant was entitled to payment in arrears of all sums due and owing under the provisions of section 25 (1) (a) of the Act with effect from the 2012/13 financial year and in each subsequent fiscal year. The actual amount due and owing was easily ascertainable from the figures submitted by the 2nd respondent as the revenue collected by the national government over the financial years in question.
- There was no statutory duty imposed on the 3rd respondent to allocate and appropriate any monies into the Fund. The 3rd respondent had not failed to discharge the duties of the Registrar in relation to sections 24 and 25 of the Act, and accordingly, an order for mandamus would not be issued against her.
- Section 25 (1) (a) of the Act enacted and imposed a mandatory obligation and the duty to abide by the same was upon the 2nd and 4th respondents. It was parliament itself through its enactment of section 25 (1) (a) of the Act that had fettered its discretion in exercising its power to appropriate monies for national expenditure. Parliament by enacting the 0.3 per cent minimum allocation and appropriation to the Fund tied its own hands. By issuing a mandatory injunction against the 2nd and 4th respondents, the court was simply reminding and compelling them to perform their statutory duties as enacted. The court was obligating them to perform that which all along had been their statutory obligation. In that regard, an order of mandamus issued to compel performance of the obligation under section 25 (1) (a) of the Act was not an interference with legislative process but an affirmation and application of the law as it was. An order of mandamus was issued directing the implementation of section 24 (1) (a) and 25 (1) (a) of the Act as enacted.
Per Githinji, JA (dissenting):
- Article 92 of the Constitution empowered parliament to enact legislation on political parties to provide, amongst other things, for the establishment and management of Political Parties Fund. The envisaged legislation, the Political Parties Act (the Act) was enacted in 2011. Section 23 of the Act established a Political Parties Fund (the Fund) to be administered by the Registrar of Political Parties (the 3rd respondent). Section 24(1) of the Act stipulated one of the two sources of the Fund whereas section 25(1) of the Act stipulated the formula for distribution of the Fund to political parties.
- The computation process was founded on the provisions of section 24(a) of the Act, that, parliament had to provide for not less than 0.3% of the revenue collected by the national government in each of the five financial years to the Fund. The phrase used in section 24(a) of the Act was as may be provided by parliament. That phrase indicated ex facie that parliament had a discretion whether or not to provide for the funds in the annual budget.
- Article 92(f) of the Constitution gave parliament power to enact a legislation to establish the Fund but did not itself establish the Fund or provide the percentage of the national government revenue which should be allocated to the Fund. The Fund was not established by the Constitution, unlike, for instance, the Equalization Fund established under article 204(1) of the Constitution or equitable share of national revenue under article 202(1) and 202(2) of the Constitution. In respect of equitable share of revenue between national and county governments, article 202(2) of the Constitution provided that the equitable share ought not be less than fifteen per cent of all revenue collected by the national government. As regards the Equalization Fund, article 204(1) of the Constitution provided that one half per cent of all revenue collected by national government shall be paid into the Fund.
- The word shallwas not used in section 24(a) of the Act. However, the respondents had not filed a cross-appeal against the finding of the trial court. In the absence of a cross-appeal, the occasion had not arisen for the conclusive judicial interpretation of section 24(a) of the Act. Nevertheless, it was doubtful, from the wording of the section, whether or not a mandatory legal duty was cast on parliament to provide 0.3% of the national government revenue every year to the Fund.
- The next stage in the computation was to show the national government revenue collected in each of the five financial years. The trial court relied on the figures provided by the appellant for the reasons that the contents of the summaries of reports by Auditor-General were not disputed and the respondents had not provided alternative figures. It was not the function of a judicial review court in an application brought under order 53 of Civil Procedure Rules to resolve disputed complex issues of fact by deep analysis of documents. Where an order of mandamus was sought to enforce payment of a specific statutory debt, the debt ought not be ascertainable from the provisions of the statute itself. It was not sufficient for a court to say that the statutory debt was not disputed or to presume that the sum was correct.
- The figures of the revenue collected by the national government derived from the summaries of reports of the Auditor-General did not seem to have taken into account the equitable share of revenue between the national and county government which by article 202(2) of the Constitution was not less than 15% of all revenue collected by the national government. In other words, the appellant in computing the statutory debt did not seem to have deducted the 15% of the revenue payable to the county governments from the revenues in the summaries of the Auditor General.
- The other factors which the appellant took into account in computing the amount claimed was the sums released to the Fund in each of the five financial years and the money paid to the appellant by the 3rd respondent in each of the five financial years. These sums were extracted from the records of the 3rd respondent and there was no doubt that the amounts paid into the Fund and to the appellant in each of the five financial years were accurate. However, the percentage of 0.03% as the total amount allocated to the Fund in the five financial years was based on the appellant’s own computation. Similarly, the total sum that should have been paid to the Fund for the five financial years being the 0.3% of the revenue collected by the national government in the five financial years is similarly based on the appellant’s own computation.
- The appellant’s computation in respect of sums released to the Fund in each of the five financial years and the money paid to the appellant by the 3rd respondent in each of the five financial years were not based on computation by an expert such as an accountant or auditor. The computations by the appellant were maters of fact and evidence which were outside the sphere of judicial review.
- The sum claimed was admittedly the sum total of the estimated amount outstanding in each of the five financial years calculated on the basis that the appellant would have received 40% of the funds from the 3rd respondent. The duty to administer the Fund was conferred on the 3rd respondent. Upon receipt of the funds in each financial year, the 3rd respondent determined the political parties which qualified for the funding and the entitlement of each according to the statutory criteria.
- As section 24(2) of the Act provided, a political party which was otherwise eligible could be denied the funds if it did not meet the additional stipulated criteria. To that extent, the claim that the appellant would have been entitled to the estimated sum claimed was speculative. Furthermore, the money if allocated would have been paid into the Fund and not to the appellant directly.
- The main reason why the trial court made a finding that the appellant was not entitled to the sum claimed was that the money was not budgeted for, allocated and appropriated for disbursement to the appellant. Article 95(4) (b) of the Constitution gave the 4th respondent the power to appropriate funds for expenditure by the national government and other national state organs.
- Article 221 of the Constitution summarized the budget process thus: the estimates of revenue and expenditure of the national government for the next financial year had to be submitted to the 4th respondent by the 2nd respondent; a committee of the 4th respondent had to discuss and review the estimates and seek representations from the public; had to take into account the recommendations of the public and make recommendations to the 4th respondent and upon approval of the estimates by the 4th respondent, an Appropriation Bill had to be introduced to the 4th respondent to authorize the withdrawal from the Consolidated Fund and for the appropriation of the money.
- By article 206(2) (a) of the Constitution, money would be withdrawn from the Consolidated Fund only in accordance with an appropriation by an Act of parliament. By article 228 (4) of the Constitution, the Controller of Budget was responsible for overseeing the implementation of the budget by, inter alia, authorizing withdrawals from the Consolidated Fund. The detailed stages in the budget process for the national government were provided in the sections 35 to 41 of the Public Finance Management Act, 2012 (PFMA). As provided in section 6 of PFMA, PFMA prevailed in case of any inconsistency between PFMA and any other legislation in various matters including, the preparation and submission of budget estimates, raising of revenue and making expenditure.
- Section 24(1) (a) of the Political Parties Act provided, inter alia, that the source of the Fund were such monies as may be provided by parliament. The only procedure as authorized by the Constitution and PFMA, for providing funds by the parliament was through the budget process. At the end of the budget process, the 4th respondent enacted the Appropriation Act to authorize the withdrawal of the funds from the Consolidated Fund for appropriation of the money for purposes mentioned in the Appropriation Act.
- Unless and until the funds were provided in the budget, approved by the 4th respondent and appropriated through the Appropriation Act and received by the 3rd respondent, the funds, did not exist for disbursement to eligible political parties. That did not happen. It followed that the money claimed was not available for disbursement to the appellant. It had not accrued to the Fund. In so far as the appellant sought by an order of mandamus to compel the respondents to allocate, appropriate and disburse the specific sum claimed post facto, the application was incompetent. That was not to say that money due under an Act could not be recovered. Such money was recoverable through appropriate proceedings and subject to the other laws such as limitation of actions.
- Although the remedy sought in the appeal was the entry of judgment for the sum claimed the order sought in the trial court was an order of mandamus to compel the respondents to allocate, appropriate, and disburse the specific sum claimed to the appellants. The appellant and its members of national assembly had opportunity in each of the five financial years to make recommendation or even lobby for appropriation of sufficient funds for the Fund.
- The law served the vigilant and acquiescence would amount to a waiver of statutory rights. In the circumstances, delay was a relevant consideration. So also was the impracticability of the enforcement of an order of mandamus against the 4th respondent which consisted of 349 members. Contempt of court proceedings against the 4th respondent would not be a practicable and effective remedy.
- The instant claim was in essence a statutory debt. The sum claimed was not directly derived from the provisions of the Act. The specific sum was not allocated and appropriated in the budget of the respective years. It was not even computed by the 3rd respondent whose responsibility was to administer the Fund. The sum was computed by the appellant through analysis of documents which the appellant annexed to the supporting affidavit. The court was called upon to construe the documents and make several findings. The appellant was asking the judicial review court to perform the function of civil court that of analysing the evidence and adjudicating on the merits of the claim with a view of ultimately determining that a statutory duty indeed existed in terms stated and was breached by the respondent.
- Judicial review proceedings as brought were not the appropriate proceedings for such task. Article 206(2)(a) of the Constitution and section 6 of PFMA overrode the provisions of the Political Parties Act in matters concerning the appropriation and disbursement of public funds except for the funds specifically created by the Constitution. In the absence of compliance with the Constitution and PFMA, the facts had not sufficiently developed to such a state as to warrant or permit an intelligent and reasonable finding that the respondents had a legal duty to pay the appellant the specific sum claimed and that they had breached that duty. For that reason, mandamus did not lie by dint of the doctrine of ripeness.
- The trial court exercised its discretion judicially and that there were no valid reasons for interfering with the exercise of discretion. However, the order of mandamus would not be granted and other ancillary orders in terms made by the trial court or in terms proposed by the majority in the appeal for the reasons that they were not sought in the application and were also of a different genre and a drastic departure from the nature of order of mandamus sought in the application in the trial court.
Appeal partly allowed.
- Appeal dismissed in so far as it related to an order of mandamus to compel the respondents to allocate, appropriate and disburse to the appellant the specific sum of Ksh. 4,135,903,545.00.
- The judgment of the trial court dated October 31, 2017 was varied in the following terms:
- An order of mandamus issued compelling the 4th respondent to comply with the provisions of section 24 of the Political Parties Act, namely to allocate and appropriate not less than 0.3% of the national government revenue collected to the Political Parties Fund for administration by the office of the 3rd respondent for disbursement to qualifying parties in accordance with the legally established formula under the Political Parties Act, 2011.
- The appellant was entitled in arrears to all monies due pursuant to section 25 (1) (a) of the Political Parties Act from the financial year subsequent the effective date of the Act, that was, arrears from the 2012/13 financial year.
- The judgment and orders were to take effect from the effective date of the Political Parties Act, 2011 namely, November 1, 2011.
- The Deputy Registrar of the court was to ensure that the judgment was served upon the 4th respondent, the Hon. Attorney General and the 2nd respondent within ten days from the date of judgment and an affidavit of service filed to that effect.
- Each party to bear its own costs before the trial court and in the appeal.
|INTELLECTUAL PROPERTY LAW
||Court of Appeal affirms High Court decision that the inclusion of a map in an advertisement was incidental and was not a copyright infringement
Nairobi Map Services Limited v Airtel Networking Kenya Limited & 2 others
Civil Appeal 125 of 2016
Court of Appeal at Nairobi
P N Waki, D K Musinga & S Gatembu Kairu, JJA
June 7, 2019
Reported by Beryl A Ikamari
Intellectual Property Law-copyright and passing off-difference between copyright and passing off-claim that respondents wrongfully broadcasted artistic work in the form of a map in a television advertisement-whether the claim related to passing off or it related to copyright infringement.
Intellectual Property Law-copyright-copyright infringement-defences to copyright infringement-incidental inclusion-inclusion of copyrighted material (a map) in a television advertisement to demonstrate a point that had already been demonstrated by other means in the advertisement-whether the inclusion of the copyrighted material (a map) was essential to the object for which the advertisement was made-Copyright Act (Cap 130), section 26(1)(c).
The respondent made a television advertisement which contained the Kenya Administrative Map. The map was a copyright publication of the appellant. The appellant was of the view that the use of the map was a copyright infringement. After attempting to approach the respondent in order to resolve the alleged copyright infringement, the appellant went to the High Court to seek relief. The 3rd respondent stated that under section 26(1)(c) of the Copyright Act, the rights of the appellant in relation to the map did not include the right to control the incidental inclusion of the map in the advertisement.
The High Court dismissed the suit stating that the use of the map in the advertisement was incidental. Thereafter, the appellant filed an appeal at the Court of Appeal against that decision.
- Whether a claim about an allegedly wrongful inclusion of an entity’s artistic work (a map) in an advertisement related to passing off or to copyright infringement.
- When would incidental inclusion of copyrighted material in artistic works be a defence in a copyright infringement action? Read More...
- At the High Court the appellant's claim included the passing off of its map as the 1st respondent's map. The passing off claim was articulated in paragraph 8 of the plaint. Therefore, while claims for passing off differed from claims of copyright infringement, the High Court could consider the allegations of passing off.
- Passing off under the 8th edition of the Black's law dictionary was the act or instance of falsely representing one's own product as that of another in an attempt to deceive potential buyers. It would be actionable in tort under the law of unfair competition and also as a trademark infringement. The ingredients of passing off were that the plaintiff would have to establish:-
- a goodwill or reputation attached to the goods or services;
- a misrepresentation by the defendant to the public (intentional or not);
- a misrepresentation by the defendant that would lead or was likely to lead the public to believe that goods or services offered by him were the goods or services of the plaintiff; and,
- that he suffered or, in a quia timet action, that he was likely to suffer, damage by reason of the erroneous belief engendered by the defendant's misrepresentation that the source of the defendant's goods or services was the same as the source of those offered by the plaintiff.
- In the evidence and pleadings of the appellant, there was a conceptual mix up in relation to the nature of the claim and on whether it was a passing off claim or a copyright infringement claim. In the evidence of PW1, the complaint was not that the map had been used in the advertisement but that in the production of the advertisement, it had been blown up and defaced and it seemed that the part of the map presented was owned by the respondents. Additionally, PW1 stated that the respondents digitised the map and could sell it as their own property. In accordance with that evidence the claim appeared to be one based on passing off.
- Passing off was not the basis on which the matter was resolved at the High Court. The issues identified for determination related to copyright ownership and infringement and also whether damages would be granted. Despite the conceptual confusion on the nature of the claim, the High Court was able to decrypt the fact that the real grievance related to copyright infringement. There was no merit in the appellant's contention that the High Court handled the matter as a passing off action.
- A copyright protected the expression and recorded content of someone's intellectual labours. Copyright infringement referred to any dealing with copyrighted material which was inconsistent with the copyright owner's interests. There was no dispute relating to the question as to whether the appellant was the copyright owner of the map. It was also not disputed that the map was used in the impugned advertisement.
- Section 26(1) of the Copyright Act gave a copyright owner rights relating to reproduction, distribution and broadcast of copyrighted material. As the copyright owner, the appellant had exclusive rights to reproduce and broadcast the map. Airing of the map undoubtedly fell within the category of broadcast or display and it would require authorization from the appellant. However, if the inclusion of the map in the advertisement or broadcast was incidental within the meaning of section 26(1)(c) of the Copyright Act, it would not amount to a copyright infringement.
- The rights of a copyright owner did not include the control of incidental inclusion of an artistic work in a film or broadcast. Copyright in work would not be infringed by incidental inclusion of the work in another artistic work. However, inclusion of copyrighted material in another artistic work would amount to a copyright infringement where the inclusion was essential to the object for which the impugned work was created. It was therefore necessary to ask why the appellant's map was included in the respondent's advertisement. If the inclusion of the map was essential to the advertisement, the defence of incidental inclusion would not be available.
- In copyright claims what constituted incidental inclusion was a matter for determination on a case by case basis. The point of the advertisement was the extent of network coverage and it had been established by having an engineer in the advertisement travel to various locations and relay information to the gentleman in the office who would tick the relevant locations on a white board. Without the map, the 1st respondent's message could be passed in the advertisement. The inclusion of the map, as correctly held by the High Court, was secondary or subordinate to the overall objective of the advertisement and therefore incidental.
Long'et Terer - CEO and Editor
The Kenya Law Team
Where Legal Information is Public Knowledge.
The National Council for Law Reporting | P.O Box 10443 - 00100, Nairobi Kenya. | www.kenyalaw.org