[2019] KEELRC 561 (KLR)
The Court found that the 1st Respondent had not demonstrated sufficient grounds to warrant an order for security for costs against the Claimants. The existence or absence of privity of contract between the Claimants and the 1st Respondent is a substantive issue to be determined at trial, not at the interlocutory...
Source-derived case information.
- Citation
- [2019] KEELRC 561 (KLR)
- Parties
- Applicant: Bernard Barongo Amwoma & 116 Others; Respondent: Orbit Chemicals Limited; Respondent: Insight Management Consultants Ltd
- Court
- Employment and Labour Relations Court
- Court Station
- Employment and Labour Relations Court at Nairobi
- Jurisdiction
- Kenya
- Case Number
- Cause 1324 of 2017
- Procedural Posture
- Security for Costs Application / Ruling on Interlocutory Application
- Outcome
- application dismissed with costs to the claimants
- Judges
- MSA Makhandia
- Legal Topics
- Security for Costs, Privity of Contract, Outsourcing Contracts, Access to Justice
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Bernard Barongo Amwoma & 116 Others
Applicant
Orbit Chemicals Limited
Respondent
Insight Management Consultants Ltd
Respondent
Procedural Posture
Security for Costs Application / Ruling on Interlocutory Application
Legal Issues
- 1 Whether the Claimants should be ordered to deposit security for costs pending the hearing and determination of the cause.
- 2 Whether there exists privity of contract between the Claimants and the 1st Respondent within the meaning of the Employment Act, 2007.
- 3 Whether requiring security for costs would unjustifiably hinder the Claimants' constitutional right of access to justice.
Ratio Decidendi
The Court found that the 1st Respondent had not demonstrated sufficient grounds to warrant an order for security for costs against the Claimants. The existence or absence of privity of contract between the Claimants and the 1st Respondent is a substantive issue to be determined at trial, not at the interlocutory stage. The Court emphasized that access to justice is a constitutional right and should not be limited except in clear and justified circumstances. The 1st Respondent failed to provide evidence of the Claimants' inability to pay costs if ordered, and the application appeared intended to stifle the Claimants' access to justice. Consequently, the Court declined to exercise its...
Court Disposition
application dismissed with costs to the claimants
Orders
- The application dated 27 May 2019 is dismissed with costs to the Claimants.
Full Case Text
Judgment text and source record
37 paragraphs
REPUBLIC OF KENYA
IN THE EMPLOYMENT AND LABOUR RELATIONS COURT AT NAIROBI
CAUSE NO. 1324 OF 2017
BERNARD BARONGO
AMWOMA & 116 ORS.......................................CLAIMANTS
VERSUS
ORBIT CHEMICALS LIMITED..................1st RESPONDENT
INSIGHT MANAGEMENT
CONSULTANTS LTD...................................2nd RESPONDENT
RULING
1. Before Court is a motion dated 27 May 2019 by the 1st Respondent seeking orders
1. THATthe Claimants jointly and severally do within a time fixed by the Honourable Court do deposit in Court as security for costs the sum of Kshs 4,000,000/= being the 1st Respondent/Applicant’s estimated costs for this Cause pending the hearing and determination of this Cause.
2. THAT in the alternative the Claimants jointly and severally do furnish as security for costs such sums as the Honourable Court may order to be deposited in an escrow account in the names of the Advocate for the Claimant and the Applicant pending hearing and determination of this Cause.
3. THAT in the event the Claimants are unable to comply with the order to deposit security then the suit against the 1st Respondent be dismissed with costs.
4. THAT in the alternative this Honourable Court be pleased to issue any further orders it deems mete and just including a stay of proceedings until such time that the orders herein will have been complied with.
2. The grounds which were advanced in support of the application were that the cause of action was anchored on an employment relationship while there was no privity of contract between the Claimants and the 1st Respondent; that the 1st Respondent had an outsourcing contract with the 2nd Respondent, an independent contractor; that the Claimants were employees of the 2nd Respondent in terms of the outsourcing contract; that there was no reasonable cause of action against the 1st Respondent and that the 1st Respondent would be unable to recover costs from the Claimants were the suit to fail.
3. In opposition to the application, the Claimants filed Grounds of Opposition on 2 July 2019.
4. The Claimants contended that the orders sought could only be made against a foreign national within the Court's jurisdiction where it was shown that there was risk of him leaving jurisdiction or that the foreigner had no assets in the country.
5. The Court heard arguments on 8 July 2019.
6. The Court has considered all the materials placed before it and come to the conclusion that the motion has no merit and should be dismissed because of the reasons outlined hereunder.
7. The legal principles governing the grant of an application such as is under consideration were set out in Keary Developments v Tarmac Construction(1995) 3 All ER 534 and the said principles were endorsed by the Court of Appeal in Westmont Holdings SDN. BHD v Central Bank of Kenya (2017) eKLR.
8. Firstly, under section 2 of the Employment Act, 2007, employer is defined to mean any person, public body, firm, corporation or company who or which has entered into a contract of service to employ any individual and includes the agent, foreman, manager or factor of such person, public body, firm, corporation or company.
9. The determination therefore whether there is privity of contract as between the Claimants and the 1st Respondent on the one part, and/or between the Claimants and the 2nd Respondent within the context of the statutory definition of an employeris an issue best left for a hearing on the merits where all the facts and law will be placed before the Court.
10. Secondly, Article 48 the Constitution guarantees all persons access to justice without hindrance, and no person should be restrained from benefiting from such a right unless in clear cases as may be discernible from statute or common law, and to the extent permissible in a democratic society as envisaged by the Constitution.
11. The 1st Respondent has not demonstrated that the Claimants right to access justice should be limited in this case by requiring them to deposit security for costs.
12. Thirdly, apart from alleging inability on the part of the Claimants to make up for any eventual costs, the 1st Respondent has not placed any facts or evidence before the Court to demonstrate or suggest inability on the part of the Claimants to pay costs were they to fail in the action.
13. It appears to the Court that the application for costs is meant to not only stifle but oppress the Claimants from accessing the seat of justice.
14. The Court declines to exercise its discretion in favour of the 1st Respondent and orders the application dated 27 May 2019 dismissed with costs to the Claimants.
15. The Court regrets that it could not deliver this Ruling on 27 September 2019 as earlier scheduled due to other official engagements.
Delivered, dated and signed in Nairobi on this 11th day of October 2019.
Radido Stephen
Judge
Appearances
For Claimants Mr. Koceyo instructed by Koceyo & Co. Advocates
For 1st Respondent Mr. Odera instructed by Oseko & Ouma Advocates
For 2nd Respondent Mr. Mudao instructed by Mudao & Co. Advocates
Court Assistant Lindsey