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Court of AppealPartially AllowedNot stated in the judgment

Nairobi City Water and Sewerage Company Ltd v Irungu (Civil Appeal 458 of 2019) (14 June 2024) (Judgment) (with dissent - S ole Kantai, JA) [2024] KECA 677 (KLR)

Court of Appeal of Kenya
14 June 2024
8,484 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~34 min to read original · ~4 min brief

The bottom line

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Kenya's Court of Appeal upheld an employee's 2009 summary dismissal, ruling the company followed fair disciplinary procedure and owed him nothing.

What this practically means

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Executive summary

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This was a first appeal to the Court of Appeal from an Employment and Labour Relations Court judgment of 29 June 2016 (Mathew N. Nderi, J) which had found that Nairobi City Water and Sewerage Company Limited had summarily dismissed Solomon Githae Irungu in 2009 without a valid reason under section 43(1) and unfairly under section 45 of the Employment Act, awarding him the full monetary claims including 12 months' compensation and service pay based on a CBA. The Court of Appeal, by a 2-1 majority, allowed the appeal in full. Warsame, JA (Mativo, JA concurring in a separate judgment) held that the claim was not statute barred under section 90 because the employee's internal appeals were only conclusively rejected in September 2013, but that the dismissal was both substantively and procedurally fair: the respondent was notified of the allegations, responded, appeared before the disciplinary committee and appeal bodies, and the minutes evidenced gross misconduct involving the reversal of a customer's water meter for a bribe. The majority found the trial court had failed to analyse the documentary evidence and had simply believed the claimant's testimony, and set aside the entire judgment and reliefs, substituting an order upholding the summary dismissal and awarding the appellant costs in both courts. Kantai, JA dissented, holding that the disciplinary process was Flagrantly flouted - dragging on over five years contrary to the HR Manual - so there was no valid reason to dismiss. The decision binds subordinate courts and the ELRC on limitation under section 90 where internal appeal processes are pursued, and on the appellate threshold for disturbing factual findings.

Questions the Court framed

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

  1. 1.Whether the claim was statute barred
  2. 2.Whether the summary dismissal was valid and procedural
  3. 3.The appropriate reliefs to be granted

Key legal issues

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01

Whether the claim was statute barred under section 90 of the Employment Act

Holding

The claim was not statute barred. Although the dismissal letter was dated 5 February 2009 and the claim filed 3 December 2013, the respondent pursued internal appeals and reinstatement attempts which were only conclusively rejected on 27 September 2013, so the cause of action accrued then.

Reasoning

Section 90 limits actions based on the Employment Act or a contract of service to three years next after the act, neglect or default complained of. The court read the words 'next after the act, neglect or default complained' to mean the period could not run while the respondent was still pursuing reinstatement through the employer's internal appeal and Corporate Appeals Committee processes. Those processes only concluded in September 2013, well within three years of filing. The trial court's finding on limitation was therefore not disturbed.

p. 9
02

Whether the summary dismissal was valid and procedural

Holding

The majority held the dismissal was substantively and procedurally fair: the respondent was notified of the allegations, responded, appeared before the disciplinary and appellate bodies, and the accusations amounted to gross misconduct. The trial court's contrary finding was set aside.

Reasoning

The minutes of the disciplinary committee and Corporate Appeals Committee recorded that the respondent disconnected a customer's water contrary to procedure and was involved with a supervisor in a bribe to reverse a meter. The trial court simply believed the claimant's testimony without analysing the documentary evidence, contrary to the restraint required when reviewing factual findings. The Ombudsman's report found no procedural impropriety. The respondent's evidence on attendance at the hearing was contradictory and unsupported by the pleadings, so the trial court erred in preferring it without evaluating the probabilities.

p. 11
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The appropriate reliefs

Holding

The reliefs awarded by the trial court were set aside in their entirety and the summary dismissal was upheld, with costs to the appellant in both courts.

Reasoning

Having found a valid reason for dismissal and a fair procedure, the foundation for the awards under sections 43, 45 and 49 of the Employment Act collapsed. The trial court had declined reinstatement and awarded the full monetary claims including 12 months' compensation and service pay based on a CBA; none of these could survive the finding that the dismissal was justified. Costs followed the event.

p. 11

Legal principles established

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  • An employer must prove the reasons for termination, that the reasons are valid and fair, and that the grounds are justified, with a mandatory process of notification and hearing under section 41 of the Employment Act
  • An appellate court will not normally interfere with a finding of fact by the trial court unless it is based on no evidence, on a misapprehension of the evidence, or the judge demonstrably acted on a wrong principle
  • The limitation period under section 90 of the Employment Act is three years, and where an employee pursues internal appeal mechanisms the period is reckoned from the conclusion of those internal processes
  • Where a trial court is faced with two mutually destructive versions it must make findings on the credibility and reliability of witnesses and on the probabilities before determining where the burden of proof lies

Court orders

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  1. 1.The judgment of Hon. Mr. Justice Mathew N. Nderi delivered on June 29, 2016 be set aside and in its place be substituted with an order upholding the summary dismissal of the respondent from employment by the appellant
  2. 2.The appellant be and is hereby awarded the costs of the claim before the Employment and Labour Relations Court, and the costs of the Appeal

The bench

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Judges wrote separately. A dissent does not bind; a concurrence may narrow the ratio.

Mohamed Abdulahi Warsame
M. WarsameJA
Currently serving
majority

Wrote the judgment

Wrote the leading judgment allowing the appeal. Found the claim was not statute barred because the internal appeal process ran until September 2013, but held that the summary dismissal was substantively and procedurally fair, set aside the ELRC judgment and the reliefs awarded, and substituted an order upholding the dismissal with costs to the appellant.

I therefore set aside the finding that the appellant had no valid reason in terms of section 43(1) of the Employment Act to summarily dismiss the respondent.p. 11
concurring

Wrote the judgment

Wrote a separate concurring judgment analysing the burden of proof on employers, the trial court's failure to evaluate two mutually destructive versions, and the contextual nature of procedural fairness. Agreed with Warsame, JA and that the appeal should succeed in terms of his orders.

Accordingly, I agree with the opinion of Warsame, JA and add that this appeal succeeds in terms of the orders issued by Warsame, JA which shall be the orders of this court.p. 16
dissenting

Wrote the judgment

Dissented. Accepted that the respondent committed gross misconduct, but held that the Employment Act makes process the central consideration; the disciplinary process dragged on for over five years contrary to the HR Manual, so the appellant had no valid reason to summarily dismiss. Would have agreed with the trial court's findings.

Because process was not followed by the appellant, nay, it was fiagrantly fiaunted, the appellant had no valid reason to summarily dismiss the respondent from employment.p. 4
On appeal from
Employment and Labour Relations Court
Not stated in the judgment
Jurisdiction invoked
Article 164(3) of the Constitution and section 3(1) of the Appellate Jurisdiction Act (first appellate jurisdiction)

Relief refused

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All reliefs awarded by the trial court (reinstatement having already been declined below; salary arrears, 12 months' compensation, notice pay, service pay, leave and acting allowance)

The court found the dismissal was justified and fair, so the reliefs awarded on the basis of unfair termination fell away

p. 11

Costs

The appellant be and is hereby awarded the costs of the claim before the Employment and Labour Relations Court, and the costs of the Appeal.

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.

a. The judgment of Hon Mr Justice Mathew N Nderi delivered on June 29, 2016 be set aside and in its place be substituted with an order upholding the summary dismissal of the respondent from employment by the appellant.
p. 12Final orders - substitution of order upholding summary dismissal
b. The appellant be and is hereby awarded the costs of the claim before the Employment and Labour Relations Court, and the costs of the Appeal.
p. 12Costs order
I therefore set aside the finding that the appellant had no valid reason in terms of section 43(1) of the Employment Act to summarily dismiss the respondent.
p. 11Reversal of trial court's section 43 finding
Having read through the whole material set before court, I am unable to see any ground to fault the disciplinary process. It was fair and in accordance with law.
p. 11Procedural fairness of disciplinary process
A party cannot answer allegations against him, go through disciplinary proceedings, lodge an appeal and “re- appeal” and claim he was not afiorded a fair process.
p. 16Contextual fairness - participation in process estops complaint of unfair hearing (Mativo, JA)
So process is everything under the Act and an employer who ignores it (process) while terminating services of an employee will fall foul of the law and will be visited with consequences as set out in the Act.
p. 17Dissenting view - primacy of process (Kantai, JA)

Issues in the judgment

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minor

The leading judgment states that Mativo, JA concurs, but Mativo's own separate judgment refers to reading 'the dissenting judgment of Kantai, JA' before Kantai's dissent appears at the end; the judgment is internally consistent on the outcome (2-1 majority) but the sequence is unusual

minor

The judgment misdates the meter reversal within the Corporate Appeals Committee minutes narrative ('The reversal was done on 13 August 2013' when the disconnection occurred on 12 August 2008), an apparent internal inconsistency

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (1)

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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, "Nairobi City Water and Sewerage Company Ltd v Irungu (Civil Appeal 458 of 2019)  (14 June 2024) (Judgment) (with dissent - S ole Kantai, JA) [2024] KECA 677 (KLR)", Case Analysis (2024). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2024/677/eng@2024-06-14

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