Mwangi v Agence Francaise De Development (Petition E120 of 2025) [2026] KEELRC 1678 (KLR) (19 June 2026) (Ruling)

Mwangi v Agence Francaise De Development (Petition E120 of 2025) [2026] KEELRC 1678 (KLR) (19 June 2026) (Ruling) Neutral citation: [2026] KEELRC 1678 (KLR) Republic of Kenya In the Employment and Labour Relations Court at Nairobi Petition E120 of 2025 M Mbarũ, J June 19, 2026 Between Ann Mwangi Petitioner and Agence Francaise De Development Respondent Ruling 1.The respondent, Agence Française de Développement, filed an application dated 26 May 2026 under the provisions of article 50 and 159(2)(d) of the Constitution and section 3 and 12 of the Employment and Labour Relations Court Act and Rule 61 of the Employment and Labour Relations Court (Procedure) Rules and seeking orders:a.ELRC Petition E120/2025 – Anne Mwangi v Agence Francaise de Development and ELRCC E504/2026 – Agence Française de Développement v Anne Mwangi be consolidated and that the two matters be heard together; and/orb.ELRC Petition E120/2025 – Anne Mwangi v Agence Francaise de Development and ELRCC E504/2026 – Agence Francaise de Development v Anne Mwangi be heard together.c.All pleadings. Affidavits and documents filed in either proceedings be deemed as properly filed and available for use in the consolidated proceedings; andd.Costs of this application be provided for. 2.The application is supported by Jean Francois, the regional director of the clamant, and on the grounds that both matters, Petition No. E120/2025 and Cause No. E504/2026 is a suit properly before this court, being a dispute arising out of an employment relationship. Petition E120/2025 was filed by Anne Mwangi, a former employee of the Agence Française de Développement, alleging unfair termination of employment, workplace harassment, and violations of constitutional rights. 3.Cause No. E504/2026 was filed by Agence Française de Développement against the former employee, Anne Mwangi, seeking recovery of Ksh. 7,889,420 is the outstanding amount on two concessionary loans advanced during employment and not repaid upon cessation of employment. 4.Francois avers that both suits in Petition E120/2025 and Cause E504/2026 relate to the same parties and arise from similar facts, save for the order sought. During her employment, Anne Mwangi, the petitioner in Petition E120/2026, had loan obligations that were advanced, as acknowledged in the petition. The loan issue is thus a live issue in both proceedings, and the court will be called to make a finding on both suits. 5.The filing of the claim by Agence Française de Développement arose out of the ruling delivered by the court on 17 December 2025, where the court held that the claimant herein was not time-barred from pursuing its claim for repayment of the loan and was at liberty to file a cross-petition or separate claim. 6.On 21 May 2026, the court directed that a formal application be made to consolidate the two matters. The instant application is filed in compliance thereof. The grant of orders sought shall not prejudice the respondent in any matter and will allow the court to hear all matters between the parties comprehensively. 7.In reply, the petitioner did not file a Reply in Affidavit to the instant application, save to rely on the Further Affidavit dated 25 May 2025. 8.The respondent, as the applicant, submitted that the consolidation of the suits herein is necessary to enable the court to hear all the issues between the parties conclusively. Section 3 of the Employment and Labour Relations Court Act allow the court to move expeditiously in resolving disputes. The petitioner amended the petition to claim alleged unlawful termination of employment and constitutional violations. She further alleges that there was workplace harassment which relates to outstanding concessionary loans she had taken from the respondent while in employment, but now alleges this has been weaponised against her. Part of the relief sought by the respondent relates to these outstanding loans from the petitioner, amounting to Ksh. 7,889,420 unpaid since employment ceased on 24 October 2024. 9.The respondent submitted that the proceedings involve the same parties and that it would serve the ends of justice to hear the two suits together by consolidation. In Abraham Nyanbane Asiago v Barclays Bank of Kenya Ltd [2013] eKLR, the court held that matters arising from loans advanced to an employee by the employer in the course of employment fall within the four corners of this court's jurisdiction. Hence, a consolidation of suits is necessary for the petitioner to urge her case regarding the alleged unfair termination of employment and workplace harassment, while the respondent will be able to urge its case for the repayment of the loan amounts advanced during employment. 10.In Nyati Security Guards v Municipal Council of Mombasa [2004] eKLR and Law Society of Kenya v Centre for Human Rights & Democracy [2014] eKLR, the courts have held that a consolidation of suits may be allowed where the same question of law or fact arises. The rights or reliefs claimed in both suits arise out of the same transaction or series of transactions. The court must also consider whether any party will be disadvantaged or prejudiced by the consolidation of the suit. In this case, both suits relate to the same parties and arise from the same facts and the employment relationship. The court is thus called to determine the circumstances of the termination of employment, the terms under which the loans were advanced to the petitioner and whether the demand for repayment upon termination of employment is lawful; and the computation of terminal dues and set-offs. 11.The respondent submitted that there is no substantive opposition to the consolidation of suits. The petitioner has not filed any Replying Affidavit but relies on the Further Affidavit dated 25 May 2026, which was the day before the instant application was filed. The same is untenable to challenge the instant application. 12.The petitioner submitted that pursuant to the Further Affidavit dated 25 May 2026, the respondent filed Cause No. E504/2026 seeking to recover the alleged outstanding loan of Ksh. 7,889,420 and nothing else. The respondent previously filed Notice of Preliminary Objections opposing the petition and asserting that it was calculated to frustrate the recovery of the loan amounts from the petitioner. On 17 December 2025, the court delivered a ruling and dismissed the objections. The court further held that the court does not preclude the respondent from filing a cross-petition or, if necessary, from filing separate appropriate legal proceedings before a competent forum. 13.The application seeking the consolidation of suits lacks merit. On 17 December 2025, the court did not allow the respondent to file a suit for recovery of the loan. This is not a competent court to address such a matter. The separate proceedings envisaged in the ruling are not a claim as denied by the respondent. 14.A court can only consolidate matters pending before it. The court cannot call out a matter pending before another judge. The petitioner is pending before the Division, while the respondent's claim in Cause No. E504/2026 is before a different Division of the Court. For the effective management of suits, consolidation would not assist in the delivery of justice. The proceedings cannot be transferred between courts. 15.In Phoenix of E.A. Assurance Company Limited v S. M. Thiga t/a Newspaper Service [2019] KECA, the court held that, without jurisdiction, a court cannot transfer suits or seek consolidation. The respondent is the claimant in the Cause No. E504/2026, and by admission, it is a money claim for the recovery of loan sums allegedly advanced to the petitioner. Such a claim is fundamentally different from the petition herein, and the issues addressed in Abraham Nyanbane Asiago v Barclays Bank of Kenya Ltd [2013] eKLR, as well as the principles thereof, are fundamentally different from those in this case. The predominant issue is not employment but a loan recovery claim. In Manpower Networks Limited v Wrigley Company (East Africa) Limited & 2 others; Richard Mutisya Maithya & 28 others (Interested parties) [2020] KEELRC, the court held that any amount of fees alleged to be outstanding can be recoverable as a commercial debt. The court has jurisdiction only to hear claims arising from employment and labour relations. 16.In Njeru v Equity Bank (K) Limited [2019] KEHC, the court held that the loan is a distinct legal obligation separate from the employment contract. Employment is merely the occasion for the loan, not the cause of action. The loan obligation stands on its own legal footing. Hence, in Cooperative Bank of Kenya Limited v Patrick Kangethe Njuguna & 5 others [2017] KECA, the court held that the predominant issue should be the test. 17.In this case, the respondent, having filed its claim, should be heard separately, and no consolidation is necessary. The orders sought should not issue. Determination 18.The respondent in the application is seeking a consolidation of suits herein, Petition E120/2025 and Cause E504/2026, on the grounds that they relate to the same parties, and the cause of action is the termination of the petitioner’s employment. The petitioner alleges that her termination of employment was unlawful due to workplace harassment and that her constitutional rights were violated. The respondent, on its part, asserts that, due to the employment, the petitioner secured concessional loans that remained unpaid and can be recovered. 19.The respondent did not file a Replying Affidavit but sought to reply on an earlier Further Affidavit dated 25 May 2026. The petitioner asserts that the petitioner and the suit are separate; they each raise a different and distinct suit and were filed before different divisions of the court. On 17 December 2025, the court delivered a ruling. It dismissed the respondents' objections, stating that a direct appeal is for filing a cross-appeal or a separate suit before the appropriate forum, which, according to the petitioner, is not this court, since the alleged loan relates to a single issue concerning its recovery. 20.In the ruling delivered on 17 December 2025, the respondent's objections concerned a challenge to the petition as framed and an assertion that the petitioner filed it to deprive the respondent of pursuing any claims she has against her. 21.While the court found this to be a proper petition, it found the issue of whether the petition was filed to defeat any claims by the respondent to be without merit. This was not a pure point of law and required a call for evidence. The petition does not preclude the respondent from filing a cross-petition or, if necessary, filing a separate appropriate legal proceedings in the competent forum.The respondent opted to file Cause E504/2026. This is followed by the instant application seeking consolidation. 22.The respondent admits that the suit under Cause E504/2026 is for the recovery of a consensual loan advanced to the petitioner, which remained unpaid at the end of her employment. That such matters relate and arise from the same employment relationship between the parties, and the court will address the matters comprehensively and conclusively if both suits are consolidated. 23.For the court, a consolidation of suits is regulated under Rule 61 of the Employment and Labour Relations Court (Procedure) Rules:61.The Court may consolidate suits if it appears that in any number of suits —(a)some common question of fact or law arises; or(b)it is practical and appropriate to proceed with the issues raised in the suits simultaneously . 24.Thus, a consolidation is allowed where suits or several suits appear to raise some common question of fact or law.Equally, the court will consolidate suits where it is practical and appropriate to proceed with the issues raised in the suits simultaneously.Thus, the principal purpose of consolidation of suits is to save costs, time and effort and to make the conduct of several actions more convenient by treating them as one action. 26.Indeed, in EAN Kenya Limited v John Sawers & 4 others [200], eKLR, the court emphasised that the test to be applied as to whether to consolidate suits or not is not whether the parties are the same, but whether the same or similar questions of law or fact are involved in the suits. This position is reiterated in Nguruman Limited v Jan Bonde Nielson [2014] KEHC 1718 (KLR). 27.I have gone through Case No. E504/2026. The main issue between the claimant and the respondent herein is that, during her employment, the petitioner secured a concessionary loan facility that remains unpaid. This fact is addressed in this petition and was addressed in the court ruling on 17 December 2025. 28.The respondent opted to file a new suit before this court to recover the concessional loan facility from its former employee. Hence, the foundational relationship leading to the concessionary loan facility is the employment relationship between the parties. Indeed, in Abraham Nyambane Asiago v Barclays Bank of Kenya Limited [2015] KEELRC 1190 (KLR), the court appreciated that, within the employment relationship, various benefits, including loans and mortgages, accrue and cannot be extricated from that relationship if the court were to consider the attendant relationship properly. 29.In Banking Insurance and Finance Union Kenya v Consolidated Bank of Kenya Limited [2020] KEELRC 1225 (KLR), the court emphasised that the employment relationship is a wide concept which cannot be restricted to the contract of service; hence, this Court has the jurisdiction to hear matters pertaining to the interest rates applicable to former employees where the subject employee secured a loan facility. Thus, the employment relationship cannot be removed from the court on the sole basis that the employer's sole issue is the recovery of the loan facility taken by the employee, who, at the end thereof, has not repaid it.In a claim for recovery of a loan amount unpaid by the former employee, the court 30.In Mulinge v Cooperative Bank of Kenya Limited [2023] KEELRC 847 (KLR) held that:By its nature, the employment relationship generates a multiplicity of rights and obligations, some of which are not to be found in the express provisions of the employment contract. … all these fall under employment and labour relations as intended by the law makers. To rule otherwise would be to create a situation where an employer or an employee traverses different courts to enforce different rights arising from the employment relationship. That in my view could not have been the intention of the legislators. 31.In applying the above test and principles to the circumstances of this case, the only difference between these suits in Petition E120/2025 and Cause E504/2026 is that one is a petition and the other a Cause. The petitioner seeks to secure her rights from the employment relationship, while the respondent seeks to secure its rights from the same relationship. By the court hearing both suits together, the issues in dispute will be effectively and effectually heard on the merits.However, the petitioner herein moved the court first and has since secured a hearing date. Hearing directions have been issued for this purpose. 32.It will be necessary to allow the petitioner, who is the respondent in Cause E504/2026, to complete the process of trial preparations before the matter is heard. 33.Directions shall be issued to allow the suits to be moved together before the same court and Judge. The order that suffices is to place the files together for hearing and determination.The respondent, as the applicant, is seeking costs. On the analysis above, it is imperative to hear the suits and costs to abide by the outcome thereof. 34.Accordingly, the application dated 26 May 2026 is allowed to the extent that the files in Petition E120/2025 and Cause E504/2026 shall be placed and heard together before the same Judge. Costs shall abide the outcome thereof. 35.The orders herein shall be placed in Cause E504/2026. Mention on 22 June 2026 for taking further directions. DELIVERED IN OPEN COURT AT NAIROBI, THIS 19TH DAY OF JUNE 2026M. MBARŨJUDGEIn the presence of:Court Assistants: Nelson Kemboi and Catherine Makau……………………………………………… and………………….…………………………...