[2023] KEHC 25463 (KLR)

Vision Institute of Professionals Limited v Maubi & 4 others (Civil Case E144 of 2020) [2023] KEHC 25463 (KLR) (Civ) (16 November 2023) (Ruling)

Neutral citation: [2023] KEHC 25463 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Law Courts)

Civil

Civil Case E144 of 2020

JN Mulwa, J

November 16, 2023

Between

Vision Institute of Professionals Limited

Plaintiff

and

Andrew Mokaya Maubi

1st Defendant

Eunice Fibi Adhiambo

2nd Defendant

Dennis Makhunu Chelot

3rd Defendant

Jackson Mwaiwa Kaviku

4th Defendant

First Community Bank Limited

5th Defendant

Ruling

1. This ruling is in respect of the 1st Defendant’s Preliminary Objection dated 23/08/2022. The objection touches on this Court’s (High Court) jurisdiction to hear and determine this suit, the same being an Employment and Labour Relations matter, as alleged.

2. A further issue is that there is another suit filed at the ELRC on or about 9/04/2020 by itself against the plaintiff herein being ELRC No. 258 of 2020 and therefore, this suit is sub-judice pursuant to Section 6 of the Civil Procedure Act whereupon it is stated: -No court shall proceed with the trial of any suit or proceedings in which the matter in issue is also directly and substantially in issue in a previous instituted suit or proceeding between the same parties, or between parties under whom or any of them claim, litigating under the same title, whether such suit or proceedings is pending in the same or any other having jurisdiction in Kenya to grant the relief claimed.

3. I have perused the 1st Defendant’s statement of defence dated 2/06/2021, and indeed all 5 defendants defences. At paragraph 16 of the defence, the matter of existence of a similar case in the ELRC court is pleaded.Parties have filed submissions on the PO which the court has considered.

4. The Plaint initiating this suit is dated 9/10/2020. The 1st – 4th defendants are described as having been employees of the plaintiff at all material times in different departments of the plaintiff.The cause of action is stated at paragraphs 12-14, being breach of employment contracts by the plaintiffs through alleged negligence and fraud that caused the plaintiff loss and damage. By the said Plaint, the plaintiff seeks compensation as stated in the plaint plus costs and interest.

5. At paragraph 16 of the plaint, it is pleaded by the plaintiff that there is no other suit pending in any other court and there have been no previous proceedings in any court between the plaintiff and the defendants over the same subject matter.

6. The 1st Defendant’s Submissions are dated 6/04/2023. It is submitted that pursuant to Article 162(2) of the Constitution, the Employment and Labour Relations Act, extends jurisdiction to the court(ELRC) relating to employment and Labour Relations and as the fraudulent acts of the Defendants 1, 2, 3 and 4 were committed when the relationship of employer- employee was in existence, then the said court has jurisdiction to over the dispute, and not the High Court.

7. The Plaintiffs submissions are dated 6/04/2023, and reiterates that this suit is properly filed before the High Court, and emphasized that, disputes relating to or arising out of employment between an employer and an employee in line with Article 162 (2) of the constitution are rightfully before the ELRC; and proceeds to urge that provision of the law and the Constitution is applicable for as long as the dispute relates to employment; if the alleged breach of contract was in line with the contract of employment;

8. The plaintiff further submits that fraud occasions personal liability, in which case the defendants cannot claim to have been acting as employees of the plaintiff when the fraud was allegedly committed, and in support cites the case Kitur Arap Tesot vs. Daniel Kiprop Kenduinywo (2019) eKLR.Additionally, it is submitted that fraud being a tortious act, the case ought to be heard before the Lower Court, or before the High Court in the first instant.

9. In the case of Kiamokana Tea Factory CO. Ltd vs. Joshua Nyakori(2015) eKLR the court held that “----- the duty of care stipulated by statute in employment cases is a civil obligation which arises where a relationship of employment exists ---- Breach of Statutory duty is not a breach of contract but breach of duty of care in tort----’’

10. On the cases filed in different courts, it is the plaintiff’s case that such other cases pending at the ELR Courts invokes the procedures used in the termination of the Defendants from employment; not for breach of contract or fraud. It is therefore urged that this court has the requisite jurisdiction to hear this case.

11. The 5th Defendants submissions are dated 23/10/23. It is its submissions that the High Court lacks jurisdiction and that in ELRC suit No. E258/2020 the questions before the court are the same questions before this court, citing the case Owners of the Motor Vessel “Lilians” v. Caltex Oil(Kenya) Limited 1989eKLR.

12. It is submitted that the ELRC Court has jurisdiction over all disputes relating to employment and labour relations exclusive in line with Article 162 (3) of the Constitution. S. 12 (1) (a) of the Actis also cited, and of importance is that the court is to hear “disputes relating to or arising out of employment between an employer and employee; as well as Virginia Nthenya vs. AG and 4 others (2021) eKLR wherein the court held that the ELRC Court’s jurisdiction is limited to employee – employer issues and violations arising out of the relationship, and strongly urges that this dispute is from the ELRC not the High Court.

13. Other citations are Daniel N. Mugendi V. Kenyatta University & 3 Others[2013] eKLR; and United States International University (USIU) V. AG (2012) eKLR.The other defendants including the 1st Defendant did not file submissions as at 1st November, 2023.

Analysis and Determination 14. Jurisdiction of a court flows from the Constitution or statute. A court cannot confer jurisdiction on itself.In Owner of the Motor Vessel “Lilian S.” V. Caltex Oil Kenya Ltd (Supra), a court of law will down its tools the moment it realizes that it has no jurisdiction, as whatever it may do without jurisdiction amounts to naught.

15. The issue therefore that falls for determination is whether the Preliminary Objection raised by the 1st Defendant has merit.Article 162 (2) (a) and 165(5) of the Constitution established a system of courts, and donates jurisdiction to each court.In particular, the Employment and Labour Relations Court, (ELRC) was established to hear and determine disputes relating to employment and labour relations and for connected purposes. Section 12(a) provides the jurisdiction of the ELRC: to determine disputes relating to or arising out of employment between an employer and an employee; and 12(h) disputes between an employers’ organization and a trade union.

16. To that end then, a dispute that arises out of employment between an employer and an employee falls squarely under the ELRC Jurisdiction.In Virginia Nthenya V. AG&4 Others(supra) the court when faced with issues similar to the instant issues, rendered itself clearly that the ELRC jurisdiction is limited to employer – employee violations arising out of the relationship.

17. There is no dispute that the alleged fraudulent actions by the Defendants were committed when the employer- employee relationship existed. Indeed, the plaintiff submitted that the alleged breach of contract of employment being the core cause of action in this suit occurred during the existence of the relationship and that resulted to their dismissals.

18. This position is supported by the 1st and 5th defendant and by implication all the other defendants who supported the Preliminary Objection raised by the 1st defendant.It is trite that a tortious and or criminal activities attract personal liability to the doer, but in this instance, such actions and or violation of the contract of employment were undertaken during the relationship; not after the termination of the relationship.

19. That is the position taken by the court in the Virginia Nthenya case cited above.Of interest is that whereas it is true that the tortious violations ought to be heard in the Magistrate’s Courts; and High court depending on the monetary value, a breach of contract, or breach of duty of care by the Defendants were so done during the existence of the employment contract.

20. In the Kiamokana Tea Factory case (supra), the court pronounce itself that, that duty of care stipulated by statute in employment cases is a civil obligation which arises where a relationship of employment exists, and is not a breach of contract but a breach of duty of care, and not case in tort.

21. Though no sufficient material facts were placed before this court in respect of ELRC no E 258 of 2020, the 5th defendant confirmed that the case pending in the said court is a dispute on the manner of termination of the 1st to 4th defendants from employment, not on the issues raised in this instant suit.

22. I am persuaded that Section 12(1)(a) of the ELRCAct is applicable in this suit, and that the dispute and cause of action herein arose and relates to a dispute out of employment between the plaintiff and the defendants; employer and employee existing relationship.The alleged fraudulent or illegal transfer of funds by the Defendants from the Plaintiffs Bank Accounts to the Defendants Personal accounts could only have been done when the defendants were in the employment of the plaintiff; and not after their employment was terminated.

23. That in my view brings the dispute right under Section 12(1)(a).The pending case ELRC E258/2020 is over a different cause of action and this case is a standalone case before the ELRC. I therefore find that the ELRC has exclusive jurisdiction over all disputes arising from existing labour relations between employees and employers, which is the undoubted scenario in this case.

24. Without the requisite jurisdiction, which I hereby find, the High Court is barred by both the constitution and statute to entertain this case, as for so doing would be conferring upon itself jurisdiction that it does not have. By the “Owners of the vessel “lilian” case, it would be futile for this court to undertake a futile exercise whose result would amount to naught.

25. I therefore decline jurisdiction, and down my tools. The Preliminary objection dated 23/06/2022 succeeds.

26. I am of the school of thought that instead of dismissing the suit for lack of jurisdiction, I do exercise my discretion and transfer this case to the court with jurisdiction, the Employment and Labour Relations Court for hearing and determination. The plaintiff shall pay costs of the Preliminary objection to the 1st defendant.

It is so directed and ordered.

DELIVERED, DATED AND SIGNED AT NAIROBI THIS 16TH DAY OF NOVEMBER, 2023. JANET MULWAJUDGE