https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/2066

**REPUBLIC OF KENYA** **IN THE EMPLOYMENT AND LABOUR RELATIONS COURT AT NYERI** **ELRC APPEAL NO. E042 OF 2024** **BETWEEN** **KIAMA FARMERS CO-OPERATIVE** **through the Chairman CHARLES N NGURE)...............................APPELLANT** **AND** **JANE MURUGI MAHINDA.........................................................RESPONDENT** **COOPERATIVE BANK…………………………………………...GARNISHEE** *(Being an appeal from the Ruling made by Hon. Grace Kirugumi in the Chief Magistrates’ Court at Karatina dated 5th November 2024)* **JUDGMENT** 1. This appeal arises from the Ruling of the Trial Court delivered on 5th November 2024 in respect of the Appellant's Notice of Motion dated 2nd July 2024. 2. Before addressing the issues arising in this appeal, it is necessary to set out the background to the dispute. 3. The Respondent commenced proceedings against the Appellant before the Magistrate's Court at Karatina in MCELRC Cause No. E009 of 2022, *Jane Murugi Mahinda v Kiama Farmers Co-operative Society*. She pleaded that she had been employed by the Appellant from 20th February 1997 until 23rd August 2018, when she opted for early retirement. At the time of her retirement, she averred that she held the position of Assistant Factory Manager. 4. The Respondent's case was that, upon opting for early retirement, she became entitled to gratuity in respect of her 21 years of service with the Appellant. 5. Consequently, the Respondent prayed for judgment against the Appellant for Kshs. 465,837.00, being her gratuity benefits, unpaid leave, together with costs of the suit and interest at court rates from 23rd August 2018 until payment in full. 6. The record bears that the Appellant entered appearance on 7th December 2022 through the firm of M.C. Kamwenji & Co. Advocates. 7. Thereafter, by a Request for Judgment dated 2nd February 2023, the Respondent sought interlocutory judgment in the sum of Kshs. 465,837.00 together with costs and interest on the ground that the Appellant had failed to file a defence within the prescribed period. 8. The record further reveals that, by a Notice of Entry of Judgment dated 15th March 2023, the Respondent's advocates notified the firm of M.C. Kamwenji & Co. Advocates that interlocutory judgment had been entered against the Appellant on 20th February 2023 for failure to file a defence. 9. The record further reflects that on 14th November 2023, a consent was adopted as an order of the Court and thereafter, costs were assessed at Kshs. 64,200 as reflected in the Certificate of Stated Costs dated 30th May 2024. A decree was thereafter issued awarding the Respondent Kshs. 465,837.00 together with interest of Kshs. 369,564.20, calculated over a period of 68 months from 23rd August 2018, as well as costs of Kshs. 64,200.00. 10. Subsequently, the Respondent filed a Notice of Motion dated 7th June 2024 seeking garnishee orders against funds held in the Appellant's bank accounts in the sum of Kshs. 899,601.20. 11. On 13th June 2024, the Trial Court issued a garnishee order nisi attaching Kshs. 899,601.20 held in the Appellant's accounts by the Garnishee bank. 12. Subsequent to the garnishee order nisi, the Appellant filed a Notice of Motion dated 2nd July 2024 seeking, inter alia, a stay of execution of the garnishee order nisi, the lifting of the said order, and the setting aside of the judgment adopted on 13th November 2023. The Appellant further sought leave for the firm of Gori & Ombongi Advocates to come on record in place of M.C. Kamwenji & Co. Advocates, as well as leave to file a Response to the Statement of Claim out of time. 13. The Motion was premised on the grounds that the Appellant's former advocates had not been authorised to enter into a consent Judgment, that the judgment had been procured through concealment and material non-disclosure, and that it was obtained fraudulently. The Appellant further asserted that it had already commenced settling the Respondent's gratuity and had paid Kshs. 170,144.00 towards that obligation. 14. The Appellant further averred that the amount properly payable to the Respondent was Kshs. 369,753. 15. It was also contended by the Appellant that the interest awarded could not be computed retrospectively. 16. The Respondent opposed the Motion by filing Grounds of Opposition and a Preliminary Objection, contending that the application was, in effect, an attempt to bring an appeal through the back door. 17. Upon considering the Appellant’s Notice of Motion, the Respondent’s Grounds of Opposition, and the parties' respective submissions, the learned Trial Magistrate delivered a ruling on 5th November 2024. In the said Ruling, the Court found that the interlocutory judgment had been regularly entered and that counsel for the Appellant entered into a consent that compromised the matter. 18. The Trial Court further observed that the Appellant had not produced any complaint against its former advocates alleging professional misconduct or fraud. The Court further noted that there was no letter from the Appellant demanding an explanation from the former advocates or setting out the actual instructions they were alleged to have acted on. 19. Consequently, the learned Trial Magistrate held that there was no basis for setting aside the consent judgment and sustained the same, subject only to credit being given for any sums already paid towards settlement of the claim and any verifiable statutory tax deductions. The Court further directed that the garnishee order remain in force until the claim was fully settled. **The Appeal** 1. Aggrieved by the Ruling of the trial Court, the Appellant lodged the present Appeal challenging the decision on the following four (4) grounds set out in the Memorandum of Appeal dated 2nd December 2024: 2. **THAT the Learned Magistrate erred in law and in fact by ignoring the illustration by the Appellant that his former advocate had ceased communicating with the Appellant, thus there is no way the Appellant offered any instructions authorising entry into a consent judgement.** 3. **THAT the Learned Magistrate erred in law and in fact in finding that there was a regular - interlocutory judgment and that there were no sufficient grounds to set aside consent judgment.** 4. **THAT the Learned Magistrate erred in law and in fact in considering extraneous matters in finding that there were instructions given to enter into a consent judgment.** 5. **THAT the Learned Magistrate erred in law and in fact by finding that the Claimant had discharged the burden of proof that the said bank accounts belonged to the Cooperative Society as a body on its own, and not held in trust for the farmers or any other person.** 6. Consequently, the Appellant prays that the Appeal be allowed, the Ruling dated 5th November 2024 be set aside, and the garnishee order be discharged. **Submissions** 1. The Appeal was canvassed by way of written submissions. On the Appellant’s part, it was submitted that the consent entered by its former advocate, which awarded interest at court rates from August 2018 and inflated the decree to Kshs. 835,401.20, went manifestly and dramatically beyond any settlement authority it could have conferred. In support of this position, the Appellant placed reliance on the case of ***Kenya Commercial Bank Ltd v Specialised Engineering Company Ltd, Civil Case No. 1728 of 1979.*** 2. The Appellant further posited that it was only required by the law to demonstrate that the advocate acted without authority or contrary to his client's instructions, which, in its view, it demonstrated through sworn affidavit evidence. 3. Referencing the case of ***Wanjiku Murigi v Nairobi City Council [1976] KLR 92,*** it was further submitted that the former advocate did not file any replying affidavit to contradict the Appellant's sworn evidence and assert that he had authority from the Appellant to enter the consent. 4. The Appellant further contended that the consent was entered into without its authority, in ignorance of the material fact that part payment had already been made, and that it unlawfully included an award of interest. In further support of its position, the Appellant invited the Court to consider the case of ***Samuel Wambugu Mwangi v Othaya Boys High School, Civil Appeal No. 7 of 2014.*** 5. It was further submitted by the Appellant that the inference drawn by the learned Magistrate is not supported by the evidence and constitutes a consideration of extraneous matters not placed before the court as proof of authority to consent to judgment. 6. The Appellant further submitted that the funds held in its accounts with the Garnishee Bank comprise proceeds from the sale of coffee and tea on behalf of its farmer-members, and therefore do not constitute the Appellant's own income or profits. 7. Citing the case of ***Communications Commission of Kenya & Others v Royal Media Services & Others [2014] eKLR***, the Appellant further submitted that the consent judgment was entered against the Appellant without its knowledge or authority, at a time when its advocate had ceased communication with it. On this basis, the Appellant posited that it was condemned without notice. 8. On the part of the Respondent, it was submitted that the Appeal has been overtaken by events as she has been paid all her dues as per the consent at the Trial Court. 9. It was further submitted by the Respondent that Mr. Kamwenji, was the Advocate on record for the Appellant until a notice of change was filed, hence the Appellant cannot claim that he had no instructions. 10. According to the Respondent, the Ruling by the trial court is correct, and there was no reason to disturb the consent order. To this end, the Respondent urged the Court to dismiss the appeal with costs. **Analysis** **and Determination** 1. This being a first appeal, the Court is under a duty to re-evaluate, re-examine and reassess the evidence that was placed before the Trial Court and to draw its own independent conclusions. ***See United India Insurance Co. Ltd v East African Underwriters (Kenya) Ltd (1985) EA 898.*** 2. Having considered the Record of Appeal in its entirety, the parties' respective submissions and the applicable law, the Court is of the view that the grounds of appeal are interrelated and may be distilled into a single issue for determination, namely, ***whether the Trial Court erred in finding that there were insufficient grounds to set aside the consent judgment.*** 3. The Appellant faults the learned Trial Magistrate for finding that the interlocutory judgment had been regularly entered and that no sufficient grounds had been established to warrant the setting aside of the consent judgment. 4. The law governing the setting aside or variation of a consent judgment is now well settled. A consent judgment may only be interfered with on grounds that would justify the vitiation of a contract, including, but not limited to, fraud, collusion, illegality, mistake, an agreement contrary to public policy, misrepresentation, non-disclosure of material facts, or ignorance of material facts. 5. This principle was reaffirmed in ***Brooke Bond Liebig (T) Ltd v Mallya (1975) EA 266,*** where it was stated as follows: ***“It is well settled that a consent judgment can be set aside only in certain circumstances, e.g on grounds of fraud or collusion, that there was no consensus between the parties, public policy or for such reasons as would enable a court to set aside or rescind a contract.”*** 1. A similar position was taken in ***Kenya Commercial Bank Ltd v Specialised Engineering Co. Ltd [1982] KLR 485,*** where it was held as follows: ***“1. A consent order entered into by counsel is binding on all parties to the proceedings and cannot be set aside or varied unless it is proved that it was obtained by fraud or collusion or by an agreement contrary to the policy of the court or where the consent was given without sufficient material facts or in misapprehension or ignorance of such facts in general for a reason which would enable the court to set aside an agreement.”*** 1. Guided by the foregoing precedents, the Court now turns to consider whether the Appellant has established sufficient grounds to warrant the setting aside of the impugned consent judgment. 2. At the outset, it is noteworthy that, although the impugned consent lies at the heart of this appeal, it was not filed as part of the Record of Appeal. Equally, the court record does not reflect that the terms of the consent were read out and recorded in open court. The only consent appearing on the record relates to the costs of the suit. 3. Be that as it may, the Appellant does not dispute that the impugned consent was entered into by its former advocates on record. Its sole contention is that the said Advocate acted without its authority. 4. Specifically, the Appellant maintains that its former Advocate compromised the suit without instructions and contrary to its express position. It further contends that communication between it and the said former Advocate had broken down and that it neither authorised nor sanctioned the execution of the consent. 5. The record indicates that, on 22nd November 2022, interlocutory judgment was entered against the Appellant after it failed to file a defence within the prescribed time, whereupon the matter was fixed for formal proof. 6. The record further reveals that, on 22nd August 2023, counsel for both parties requested the Court to place the file aside to enable them engage in discussions. 7. The record further indicates that, on 14th November 2023, the parties' advocates confirmed the consent, whereupon it was adopted as an order of the Court. 8. It is evident from the proceedings that Mr. Kamwenji, who was then on record for the Appellant, was present in Court when the consent was adopted and expressly confirmed it on the Appellant's behalf. There is nothing on the record to suggest that he lacked the requisite authority to act for his client at that stage of the proceedings. 9. Equally, it is notable that the averments by the Appellant's Chairman, ***Charles Ndamburi Ngure,*** in his supporting affidavit sworn on 26th June 2024, to the effect that the Appellant never authorised its former advocates to enter into the consent, were not supported by any cogent evidence. 10. Having alleged that its advocates acted without instructions, the burden rested upon the Appellant to demonstrate that fact. In this regard, it was reasonably expected that the Appellant would place before the Court correspondence repudiating the Advocates' actions, demanding an explanation, or otherwise communicating that they had acted contrary to the Appellant's instructions. No such evidence was produced. 11. As correctly observed by the learned Trial Magistrate, there is no correspondence from the Appellant to its former advocates challenging the authority under which they acted, demanding an explanation for the alleged departure from instructions, or setting out the instructions that had in fact been given. 12. In the absence of such evidence, the Appellant's assertion that its former Advocates lacked authority to enter into the impugned consent remains unsubstantiated and cannot be sustained. 13. On this issue, the Court adopts the position articulated by the Court in ***Kenya Commercial Bank Ltd v Specialised Engineering Co. Ltd (supra),*** that a duly instructed advocate has implied general authority to compromise and settle the action and the client cannot avail himself of any limitation by him of the implied authority to his advocate unless such limitation was brought to the notice of the other side. 14. In view of the foregoing reasons, the Court is in agreement with the learned Trial Magistrate that the Appellant failed to establish sufficient grounds to warrant the setting aside of the consent judgment. 15. Consequently, the Appeal is devoid of merit and is hereby dismissed. 16. To bring the matter to a close, there will be no orders as to costs. **DATED, SIGNED** and **DELIVERED** at **NYERI** this **16th** day of **July** 2026. **………………………………** **STELLA RUTTO** **JUDGE** **In the presence of:** For the Appellant Mr. Gori For the Respondent No appearance Court Assistant Ndati **ORDER** In view of the declaration of measures restricting Court operations due to the COVID-19 pandemic and in light of the directions issued by His Lordship, the Chief Justice on 15th March 2020 and subsequent directions of 21st April 2020 that judgments and rulings shall be delivered through video conferencing or via email. They have waived compliance with Order 21 Rule 1 of the Civil Procedure Rules, which requires that all judgments and rulings be pronounced in open Court. In permitting this course, this Court had been guided by Article 159(2)(d) of the Constitution which requires the Court to eschew undue technicalities in delivering justice, the right of access to justice guaranteed to every person under Article 48 of the Constitution and the provisions of Section 1B of the Civil Procedure Act (Chapter 21 of the Laws of Kenya) which impose on this Court the duty of the Court, inter alia, to use suitable technology to enhance the overriding objective which is to facilitate just, expeditious, proportionate and affordable resolution of civil disputes. **STELLA RUTTO** **JUDGE**