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Case Brief · caselaw.co.ke
Court of AppealPartially AllowedNot stated in judgment (arising from HC ACEC No. 03 of 2018)· [2024] KECA 1688 (KLR)

The Registered Trustees of The Sisters of Mercy (kenya) T/A Mater Hospital v Dr John Muriithi & 5 others

Court of Appeal
22 November 2024
5,524 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~22 min to read original · ~4 min brief

The bottom line

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The Court of Appeal confirmed Kenyans can sue for corruption losses in civil court without waiting for a criminal conviction, but must file in the Civil Division.

What this practically means

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Executive summary

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This is a first appeal, on issues of law only, from a ruling of Onyiego, J. delivered on 8th November 2018 in HC ACEC No. 03 of 2018. Mater Hospital sued five employees and Sheer Logic Management Consultants, claiming Kshs.127,836,053.00 as special damages and general damages for corruption or fraud arising from alleged misappropriation of cash receipts. A preliminary objection on jurisdiction led the High Court to hold that although the High Court had jurisdiction, the suit belonged in the Civil Division, and the file was transmitted there. The appellant appealed, contending that private civil actions lie under sections 51 and 52 of the Anti-Corruption and Economic Crimes Act without prior conviction and that the proper forum is the Anti-Corruption and Economic Crimes Division; the 1st respondent cross-appealed, seeking striking out of the suit. The Court of Appeal held that a private person may institute civil proceedings for compensation under sections 51 and 53 of the ACECA without a prior conviction, the statutory language imposing liability on conduct that 'constitutes' corruption or economic crime, in contrast to the conviction-based compensation orders under section 54. However, such suits belong in the Civil Division of the High Court, since the Chief Justice's Practice Directions conferring jurisdiction on the ACEC Division over 'the payment of compensation' refer only to enforcement of section 54(4) orders. The appeal partially succeeded and the cross-appeal failed in its entirety, with each party bearing its own costs on both the appeal and cross-appeal.

Key legal issues

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01

Whether civil liability under sections 51 and 52 ACECA is predicated on conviction

Holding

No; liability arises from conduct that constitutes corruption or economic crime, with conviction only required for compensation orders under section 54

Reasoning

The court contrasted the language of sections 51 and 52 ('does anything that constitutes') with section 54 (compensation on conviction). It also drew support from section 55 forfeiture proceedings, where reading 'constitutes' as 'convicted of' would defeat the non-conviction-based design of the statute. It found it unfair to require a victim to await a criminal conviction, with its higher standard of proof, before pursuing civil compensation on a balance of probabilities.

p. 7
02

The proper forum for private civil suits under sections 51 and 52 ACECA

Holding

The Civil Division of the High Court, not the Anti-Corruption and Economic Crimes Division

Reasoning

The Chief Justice's Practice Directions of 9th December 2016 confer on the ACEC Division jurisdiction over matters including 'the payment of compensation of proceeds of corruption', which the court read as referring to enforcement of compensation orders under section 54(4), not original civil claims under sections 51 and 52. Such suits belong in the Civil Division, or the ordinary High Court or subordinate court depending on pecuniary jurisdiction.

p. 11
03

Whether the trial court erred in holding that section 54 must 'come to play first'

Holding

The Court could not uphold that finding; sections 51 and 52 stand independently of section 54

Reasoning

The Court held the trial judge erred in reading sections 51 and 52 as dependent on section 54. It nonetheless affirmed the judge's conclusion on forum, agreeing the suit ought to have been filed in the Civil Division. This partially reverses and partially affirms the decision below.

p. 11
04

Whether the suit should have been struck out (cross-appeal)

Holding

No; transfer was the correct remedy since the defect was one of forum, not jurisdiction

Reasoning

Having found the suit was filed in the wrong Division for administrative reasons rather than want of jurisdiction, the Court held the trial judge could not be faulted for ordering transfer. Striking out was not available, so the 1st respondent's cross-appeal failed in its entirety.

p. 11

Legal principles established

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  • Civil liability under sections 51 and 52 of the ACECA arises upon conduct constituting corruption or economic crime, not upon conviction; civil proceedings for compensation under those sections need not be preceded by a conviction.
  • Compensation orders under section 54 are conviction-based, and this contrast confirms that sections 51 and 52 create non-conviction-based civil liability.
  • Civil proceedings under sections 51 and 52 of the ACECA belong in the Civil Division of the High Court (or the ordinary High Court/subordinate court), not the Anti-Corruption and Economic Crimes Division.
  • Where a suit is filed in the wrong Division of the High Court for administrative rather than jurisdictional reasons, the proper course is transfer, not striking out.

Court orders

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  1. 1.Appeal allowed partially to the extent that the appellant can pursue a private action for compensation pursuant to sections 51 and 53 of the ACECA without first obtaining a conviction against the respondents, but at the Civil Division of the High Court at Nairobi
  2. 2.Cross-appeal dismissed in its entirety
  3. 3.Each party to bear its own costs on both the appeal and the cross-appeal
On appeal from
High Court of Kenya, Anti-Corruption and Economic Crimes Division
HC ACEC No. 03 of 2018
Jurisdiction invoked
First appellate jurisdiction of the Court of Appeal over the High Court (the judgment does not cite a specific provision; the matter is a first appeal on issues of law)

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "The Registered Trustees of The Sisters of Mercy (kenya) T/A Mater Hospital v Dr John Muriithi & 5 others", Case Analysis (2024). Not stated in judgment (arising from HC ACEC No. 03 of 2018). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2024/1688/eng@2024-11-22

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