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Case Brief · caselaw.co.ke
Court of AppealPartially AllowedCivil Appeal No. 67 of 2017

Trocaire v Catherine Wambui Karuno [2018] KECA 769 (KLR)

Court of Appeal of Kenya
2 February 2018
2,559 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Court of Appeal ruled that when a fixed-term contract expires, an employer owes no explanation and no renewal is legally required.

What this practically means

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Executive summary

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The Court of Appeal (Visram, Karanja and Koome, JJ.A) allowed Trocaire's appeal against a judgment of the Employment and Labour Relations Court (Wasilwa, J.) which had found that Catherine Wambui Karuno's services were terminated unfairly by redundancy and awarded her one month's salary in lieu of notice and twelve months' salary as damages, plus costs and interest. The respondent had been engaged on successive fixed term contracts, the last running from 1st March 2014 to 30th June 2014. Before its expiry, the appellant had made representations suggesting an extension of at least two years, but later unequivocally offered only a four-month contract, which the respondent accepted. The ELRC held she had a legitimate expectation of extension and that the appellant's letter to the Ministry of labour and payment of a 'redundancy package' established redundancy under Section 40 of the Employment Act. The Court of Appeal reversed, holding that fixed term contracts carry no rights or expectations beyond their expiry, that the respondent voluntarily executed the third contract and was bound by its terms, and that she could not rely on earlier representations. The letter to the Ministry and the redundancy package were held to be errors of no relevance. The contract lapsed automatically by effluxion of time, so the employer owed no justification for non-renewal. The judgment of 6th July 2016 was set aside in its entirety and the respondent's suit dismissed with costs.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether legitimate expectation or estoppel arose from the appellant's earlier representations that the respondent's contract would be extended
  2. 2.Whether redundancy could be inferred where the fixed term contract lapsed by effluxion of time
  3. 3.Whether the award of 12 months' salary as damages was justified

Key legal issues

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01

Legitimate expectation/estoppel in renewal of a fixed term contract

Holding

Earlier expressions of intent to extend did not give rise to a legitimate expectation of renewal; the unequivocal later indication of non-extension and the respondent's voluntary execution of the four-month contract precluded estoppel.

Reasoning

The court noted prior extensions had always been effected by executing new contracts. Before the second contract expired, the appellant unequivocally stated it would only extend for four months and had no desire to extend further. The respondent accepted the new terms voluntarily, so her earlier expectations could not materialize and could not found estoppel or legitimate expectation.

p. 3
02

Whether redundancy was inferred despite effluxion of time

Holding

No. The contract lapsed automatically on 30th June 2014; the letter to the Ministry of labour and the redundancy package were irrelevant and could not found a finding of redundancy.

Reasoning

The court held that once a fixed term contract ends, the employer has no obligation to justify termination beyond the lapse of the fixed period. The appellant's mislabelled correspondence and payment of a 'redundancy package' were errors without relevance to the legal character of the termination.

p. 4
03

Quantum of damages for unlawful redundancy

Holding

The award of 12 months' salary fell away with the finding that there was no unfair termination, and the entire judgment was set aside.

Reasoning

Having found that the contract lapsed by effluxion of time and no redundancy occurred, the foundation for the ELRC's award (one month's notice pay and 12 months' salary as damages) disappeared, warranting interference with the decision below in its entirety.

p. 4

Legal principles established

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  • Fixed term contracts carry no rights, obligations or expectations of renewal beyond the date of expiry
  • Once a fixed term contract lapses, the employer need not justify non-renewal or termination on grounds beyond effluxion of time
  • A party who voluntarily executes a fixed term contract with known terms is bound by it and cannot rely on earlier representations
  • Courts enforce contracts as agreed and should not imply terms merely because they seem reasonable

Court orders

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  1. 1.Appeal allowed with costs
  2. 2.Judgment of the ELRC dated 6th July 2016 set aside in its entirety
  3. 3.Substituted with orders dismissing the respondent's suit with costs

The bench

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One judgment of the whole court — no separate or dissenting opinions.

majority
majority
Martha Karambu Koome
M. K. KoomeJA
Currently serving
majority
On appeal from
Employment and Labour Relations Court at Nairobi
ELRC Cause No. 1325 of 2015
Jurisdiction invoked
First appeal to the Court of Appeal under the Employment Act regime / appellate jurisdiction of the Court of Appeal (judgment does not state a specific provision)

Relief refused

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Respondent's claim for damages for unfair redundancy and notice pay

The fixed term contract lapsed by effluxion of time and no legitimate expectation or redundancy arose

p. 4

Costs

Appeal allowed with costs; respondent's suit dismissed with costs

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

fixed term contracts carry no rights, obligations, or expectations beyond the date of expiry.
p. 3Fixed term contracts - legitimate expectation
Once a fixed term contract is at an end, the employer has no obligation to justify termination on other grounds beyond the lapse of the fixed period.
p. 4Termination of fixed term contracts
we find that the respondent was bound by the contractual terms of the third contract and could not rely on the earlier representations.
p. 3Estoppel - voluntary execution of contract
We set aside the judgment dated 6 th July, 2016 in its entirety and substitute the same with orders dismissing the respondent’s suit with costs.
p. 4Final orders - disposition

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (2)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Trocaire v Catherine Wambui Karuno [2018] KECA 769 (KLR)", Case Analysis (2018). Civil Appeal No. 67 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2018/769/eng@2018-02-02

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.