Kenya Union of Commercial Food & Allied Workers v Almasi Beverages Limited [2020] KEELRC 984 (KLR)
The bottom line
#Kenya's Employment Court ruled a company that failed to deposit judgment money as agreed loses its protection from debt recovery within 14 days.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Is the court functus officio?
- 2.Does the substitution of the respondent commence fresh proceedings with regard to execution?
- 3.Should the court grant the orders requested (setting aside the stay / allowing recovery of the judgment sum)?
- 4.Who should pay costs?
Key legal issues
#Functus officio
The court is not functus officio because the consent orders of 16th November 2017 remain alive and enforceable.
Functus officio applies where the court has fully discharged its mandate with nothing remaining. Here the stay of execution was conditional on a deposit within 30 days of 16th November 2017, with mention fixed for confirmation of compliance. Those orders were still operative, so the court retained jurisdiction to revisit the directions and enforce the conditions.
Effect of substitution of the respondent
The substitution of Kisii Bottlers Limited for the former respondent did not start fresh proceedings or release the respondent from the consent order.
The substitution by application dated 30th October 2019 was for continuity after a business transfer and postdates the consent order of 16th November 2017. The substituted entity carries over the liabilities, including the judgment debt, and is entitled to the benefit of the consent but equally bound by its conditions.
Non-compliance with consent stay terms
The respondent failed to deposit the judgment sum as ordered and its explanations were unreasonable; a deposit with Sidian Bank not per the court order was non-compliant.
The consent order required deposit of ksh.3,450,508 in a joint interest-earning account of both counsel within 30 days of 16th November 2017. Since that date there was no compliance. The claim on the bar that an account was opened with Sidian Bank and a deposit made was contrary to the terms of the orders and could not amount to a valid deposit for stay pending appeal.
Legal principles established
#- A court that has issued conditional stay orders retains jurisdiction to revisit and enforce those conditions; it is not functus officio.
- A substituted respondent takes over the liabilities, including judgment debts, of the entity it replaced under a business transfer.
- A deposit made contrary to the terms of a consent order cannot qualify as compliance for stay of execution.
Court orders
#- 1.The respondent shall submit evidence of back deposit and declare the interests earned in the stated deposit with Sidian Bank with regard to the stated deposit of ksh.3,450,508 within 14 days through an Affidavit and attach the necessary evidence
- 2.The respondent shall cause a deposit of ksh.3,450,503 with the court within the next fourteen (14) days from the date hereof
- 3.Costs to the claimant upon assessment of (a) above and, in the absence of compliance, the court shall direct as appropriate
- 4.Where there is no compliance to (a) and (b) above, orders of stay of execution shall lapse on the 14th day from the date hereof and the claimant shall be at liberty to commence execution proceedings
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- Jurisdiction invoked
- Original employment and labour relations jurisdiction of the Employment and Labour Relations Court over a decree and post-judgment stay orders in a cause before it
Relief refused
#Immediate striking out of the Notice of Appeal dated 10th May, 2017
The court instead gave the respondent 14 days to comply with the consent-order deposit terms before the stay lapses
Immediate setting aside of the stay orders of 8th June 2017 / immediate liberty to execute
The stay was kept alive conditionally, lapsing only in default of compliance within 14 days
Costs
Costs to the claimant upon assessment of compliance with order (a); in the absence of compliance the court shall direct as appropriate.
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
The court on its orders is hence not functus officio. The orders are alive and the claimant has gone back on these orders of this court.
There is no gap herein. The respondent as a legal entity carried over liability and including the judgement credit herein.
There is no compliance with the consent orders of 16 th November, 2017 and the explanations given lack reasonableness and an outright violation of the terms of the consent and orders of the court.
It is therefore fair, reasonable and appropriate here to review the terms of the orders of stay of execution issued on 16 th November, 2016.
(d) Where there is no compliance to (a) and (b) above, orders of stay of execution herein shall lapse on the 14 th day from the date hereof and the claimant shall be at liberty to commence execution proceedings.
Issues in the judgment
#Internal inconsistency in the date of the consent order being reviewed – the judgment refers to orders of stay issued on 8th June 2017, consent of 16th November 2017, and then 'orders of stay of execution issued on 16 th November, 2016'
Discrepancy in the deposit figures ordered – ksh.3,450,508 in the consent order and order (a) versus ksh.3,450,503 in order (b)
Reference to 'write proceedings' and 'written proceedings' apparently meaning 'writ proceedings'
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenya Union of Commercial Food & Allied Workers v Almasi Beverages Limited [2020] KEELRC 984 (KLR)", Case Analysis (2020). ELRC Cause (Nakuru) – Notice of Motion dated 30th September, 2019. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/984/eng@2020-06-02
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.