[2014] KEELRC 571 (KLR)
The court found that Timber Corner Limited's objection was not supported by evidence showing exclusive ownership of the attached goods. The presence of a common director between the objector and the respondent, and the lack of clear separation of assets, indicated that the objection was a device to frustrate the...
Source-derived case information.
- Citation
- [2014] KEELRC 571 (KLR)
- Parties
- Claimant: Fanuel Okumu Itare; Respondent: Talani Manufacturing Limited; Objector: Timber Corner Ltd
- Court
- Employment and Labour Relations Court
- Court Station
- Employment and Labour Relations Court at Nairobi
- Jurisdiction
- Kenya
- Case Number
- Cause 537 of 2011
- Procedural Posture
- Employment Cause / Ruling on Objection to Execution
- Outcome
- Objection dismissed; execution allowed.
- Legal Topics
- Execution of Award, Employee Rights, Lifting Corporate Veil
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Fanuel Okumu Itare
Claimant
Talani Manufacturing Limited
Respondent
Timber Corner Ltd
Objector
Procedural Posture
Employment Cause / Ruling on Objection to Execution
Legal Issues
- 1 Whether the objection by Timber Corner Limited to the execution of the award against Talani Manufacturing Limited is valid.
- 2 Whether the attached goods belong to the objector to the exclusion of the respondent.
- 3 Whether the objection is a misuse of corporate structure to frustrate enforcement of employment rights.
Ratio Decidendi
The court found that Timber Corner Limited's objection was not supported by evidence showing exclusive ownership of the attached goods. The presence of a common director between the objector and the respondent, and the lack of clear separation of assets, indicated that the objection was a device to frustrate the claimant's enforcement of the award. The court held that allowing such objections would undermine the fair administration of industrial justice and permit employers to evade liability for employment wrongs through corporate facades. Therefore, the objection was rejected and the claimant was allowed to proceed with execution.
Court Disposition
Objection dismissed; execution allowed.
Orders
- The application dated 25th June 2013 objecting to execution is rejected.
- The claimant is at liberty to proceed with execution.
Full Case Text
Judgment text and source record
23 paragraphs
REPUBLIC OF KENYA
IN THE INDUSTRIAL COURT AT NAIROBI
CAUSE NUMBER 537 OF 2011
BETWEEN
FANUEL OKUMU ITARE….……………………………………………………………………CLAIMANT
VERSUS
TALANI MANUFACTURING LIMITED…………………………………………………. RESPONDENT
TIMBER CORNER LTD……………………………………………………………………………..OBJECTOR
RULING
The Court delivered the Award in favour of the Claimant way back on 2nd August 2012.
The Respondent did not comply with the Award. The Claimant sought to execute, and instructed Muhata Pala Auctioneers to proclaim the movable property of the Respondent.
On 26th June 2013, an entity known as Timber Corner Limited filed an Objection, claiming the proclaimed items belong to Timber Corner Limited, not Talani Manufacturers Limited.
The two companies have a common Director in Mr. C.H. Shah. Mr. C. H. Shah accepted the summons initiating the proceedings herein, which according to the affidavit sworn by his Advocates, were forwarded by Mr. C. H. Shah to their insurance company to meet the Claim.
The Advocates agreed to have the objection disposed of by way of written submissions.
The Court is satisfied that the objection has been made merely to frustrate an Employee, in recovering the full benefit of the Award.
Mr. C. H. Shah is a common Director of his companies, and the attached goods have not been shown to belong to the Objector to the exclusion of its sister companies. It is not acceptable to the fair administration of industrial justice that Employers are allowed to escape liability for employment wrongs, by use of a multiplicity of legal facades.
IT IS ORDERED:-
(a) The Applications dated 25th June 2013 objecting to execution is rejected.
(b) The Claimant is at liberty to proceed with execution.
(c) No order on the costs.
Dated and delivered at Nairobi this 25th day of March 2014
James Rika
Judge