Candy Kenya Limited v Shantatu & another (Cause E702 of 2023) [2024] KEELRC 1527 (KLR)
The bottom line
#The Employment Court refused to grant an injunction, confirming that once it rules it lacks jurisdiction because of an arbitration clause, it cannot help—even under the Arbitration Act.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the Court has jurisdiction to grant an injunction pending arbitration despite its earlier ruling that it lacks jurisdiction over the Claim
- 2.Whether the Court can grant an injunction pending appeal from its own ruling on jurisdiction
- 3.Whether Sections 7(1) and (2) of the Arbitration Act and Rule 2 of the Arbitration Rules confer jurisdiction on the Court to grant interim reliefs in aid of arbitration
- 4.Whether the Court is functus officio after its ruling on jurisdiction
Key legal issues
#Whether the Court can grant interim relief in aid of arbitration despite lacking jurisdiction over the substantive dispute
The application was declined; the Court lacks jurisdiction and is functus officio, and the arbitration clause ousts the Court's jurisdiction on interlocutory as well as substantive aspects.
The Court had already ruled it had no jurisdiction by reason of the arbitration clause in the employment contract. Nothing had changed since that ruling to confer jurisdiction. The arbitration clause covered all claims and controversies, depriving the Court of jurisdiction over interlocutory as well as substantive disputes. Interim orders desired by the Claimant could be pursued before the arbitrator, and the Court should not aid the arbitrator where the clause makes no provision for such assistance.
Scope of Section 7 of the Arbitration Act on interim measures
Sections 7(1) and (2) and Rule 2 apply only if the arbitration clause allows the Court to render assistance on preliminary or provisional matters.
The Court read the statutory power to grant interim relief as conditional on the arbitration agreement itself providing for court intervention, such as in appointments of arbitrators or temporary injunctions. Here the clause completely and positively ousted the Court's jurisdiction, so the statutory gateway was not available to the Claimant.
Whether an injunction was needed to render any intended appeal sustainable
No; a successful appeal would correct the Court's finding on jurisdiction, and the appeal is not rendered nugatory by the declaration of lack of jurisdiction.
The Court held that the declaration that it lacks jurisdiction does not destroy the value of an intended appeal; if successful on appeal, the appellate court would simply correct the view taken on jurisdiction. Positive orders from the Court whose jurisdiction it has disclaimed are unnecessary for the appeal to be sustainable.
Legal principles established
#- Sections 7(1) and (2) of the Arbitration Act apply only where the arbitration clause itself permits the Court to render assistance on preliminary or provisional matters pending arbitration.
- A court that has ruled it lacks jurisdiction is functus officio and cannot grant interim reliefs through alternative means unless something changes to confer jurisdiction.
Court orders
#- 1.The application is declined.
- 2.No order on the costs.
- 3.The file shall be marked as closed.
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- Jurisdiction invoked
- Arbitration Act, Sections 7(1) and (2), and Rule 2 of the Arbitration Rules, considered against the employment contract's arbitration clause
Relief refused
#Injunction restraining the Respondents from engaging in any employment contract pending arbitration
The Court lacks jurisdiction and is functus officio; no Claim with prima facie probability of success is pending before it
Injunction pending appeal against the ruling on jurisdiction
Not within the Court's mandate where it has found it lacks jurisdiction; a successful appeal will itself correct the position
Costs
No order on the costs.
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 has no jurisdiction to entertain the current application. It ruled that it does not have jurisdiction. It is functus officio. Nothing has changed to confer jurisdiction on the Court, since the ruling was made.
There would have to be provision for the intervention of the Court, in granting assistive orders pending arbitration, in the arbitration clause itself. The arbitration clause completely and positively ousts the jurisdiction of the Court.
The Court does not have to grant the Claimant positive orders, for the intended appeal to be sustainable.
It Is Ordered: a. The application is declined. b. No order on the costs. c. The file shall be marked as closed.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Candy Kenya Limited v Shantatu & another (Cause E702 of 2023) [2024] KEELRC 1527 (KLR)", Case Analysis (2024). not stated in excerpt. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1527/eng@2024-06-14
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.