[2002] KEHC 1165 (KLR)

[2002] KEHC 1165 (KLR)

The court held that the clause stipulating that the agreement is governed by the laws of England concerns only the construction or interpretation of the agreement and does not relate to the jurisdiction of the Kenyan courts or the applicability of Kenyan law. The court further found that there is a well-settled rule prohibiting agreements that oust the jurisdiction of the court, and that arbitration clauses do not exclude the court's residual jurisdiction to grant interim relief, especially in cases where local securities are at risk. The plaintiff was therefore entitled to bring the suit under section 7(1) of the Arbitration Act 1995 and the Arbitration Rules 1997 for interim protection...

Citation
[2002] KEHC 1165 (KLR)
Parties
Plaintiff: Indigo EPZ Limited; Defendant: Eastern and Southern African Trade & Development Bank
Court
High Court
Court Station
High Court at Nairobi (Milimani Law Courts)
Jurisdiction
Kenya
Judgment Date
25 October 2002
Case Number
Civil Case 1034 of 2002
Procedural Posture
Civil Case / Ruling on Preliminary Objection/application to Dismiss Suit for Lack of Jurisdiction
Outcome
defendant's application dismissed with costs; time enlarged for defendant to take procedural steps
Legal Topics
Arbitration Clauses, Jurisdiction of Courts, Interim Injunctions, Applicability of Foreign Law
Source Language
English
Commercial and Corporate Civil Procedure Arbitration Clauses Jurisdiction of Courts Interim Injunctions Applicability of Foreign Law

Case Brief

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Parties

Indigo EPZ Limited

Plaintiff

Eastern and Southern African Trade & Development Bank

Defendant

Procedural Posture

Civil Case / Ruling on Preliminary Objection/application to Dismiss Suit for Lack of Jurisdiction

Legal Issues

  1. 1 Whether the High Court of Kenya has jurisdiction to entertain a suit where the parties have agreed to refer disputes to international arbitration under the ICC Rules.
  2. 2 Whether a clause stipulating that the agreement is governed by the laws of England ousts the jurisdiction of Kenyan courts.
  3. 3 Whether the plaintiff is entitled to seek interim protection under section 7(1) of the Arbitration Act 1995 and Arbitration Rules 1997.

Ratio Decidendi

The court held that the clause stipulating that the agreement is governed by the laws of England concerns only the construction or interpretation of the agreement and does not relate to the jurisdiction of the Kenyan courts or the applicability of Kenyan law. The court further found that there is a well-settled rule prohibiting agreements that oust the jurisdiction of the court, and that arbitration clauses do not exclude the court's residual jurisdiction to grant interim relief, especially in cases where local securities are at risk. The plaintiff was therefore entitled to bring the suit under section 7(1) of the Arbitration Act 1995 and the Arbitration Rules 1997 for interim protection...

Court Disposition

defendant's application dismissed with costs; time enlarged for defendant to take procedural steps

Orders

  • The defendant's application to dismiss the suit for lack of jurisdiction is dismissed with costs.
  • The defendant is granted 7 days from the date of the ruling to take any procedural steps it deems appropriate.