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ELRCStruck OutNot stated in judgment· [2024] KEELRC 2361 (KLR)

Wachiuri v Agricultural Finance Corporation (Cause E690 of 2023) [2024] KEELRC 2361 (KLR)

Employment and Labour Relations Court
30 September 2024
849 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~3 min to read original · ~4 min brief

The bottom line

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A Kenyan court struck out an employment claim filed too late, confirming that settlement negotiations do not pause the three-year filing deadline.

What this practically means

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Executive summary

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The Claimant filed a Notice of Motion on 24th August 2023 seeking leave to file suit against the Respondent out of time, asserting that parties had been engaged in settlement negotiations and that her cause of action only crystallised on 30th March 2023 when the Respondent indicated it would not honour her claim. Her final dues had been paid on 15th September 2020, and she wrote demanding the balance on 6th December 2022. The Respondent filed a Notice of Preliminary Objection dated 11th October 2023 contending that the court lacked jurisdiction to hear a time-barred claim under Section 4(1) of the Limitation of Actions Act as read with Section 90 of the Employment Act, and that the claim was an abuse of process for want of capacity. Parties filed written submissions. The court, per Linnet Ndolo J, held that negotiations do not stop time from running, adopting the Court of Appeal's decision in Attorney General v Andrew Maina Githinji and the Letang v Cooper definition of a cause of action. On the question of discretion, the court relied on Beatrice Kahai Adagala v Postal Corporation of Kenya, holding that Section 90 of the Employment Act is in mandatory terms, a contract-based claim must be filed within three years, and the period can only be extended in tort claims satisfying Sections 27 and 28 of the Limitation of Actions Act. The application for extension of time was declined, the Preliminary Objection upheld, the claim struck out, and each party ordered to bear their own costs.

Key legal issues

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01

Whether negotiations for out-of-court settlement toll the limitation period

Holding

No; time continues to run despite negotiations

Reasoning

Relying on Attorney General & another v Andrew Maina Githinji, the court held that time does not stop running merely because parties are in negotiations. The cause of action arises when the act, neglect or default occurs, not when settlement talks fail. The Claimant's cause of action therefore arose before the three-year period lapsed, and the claim filed in 2023 was out of time.

p. 2
02

Whether the Court has discretion to extend the limitation period under Section 90 of the Employment Act

Holding

No; Section 90 is mandatory and only admits extension in tort claims under Sections 27 and 28 of the Limitation of Actions Act

Reasoning

Following Beatrice Kahai Adagala v Postal Corporation of Kenya and Divecon Limited v Samani, the court held that Section 90 is in mandatory terms. A claim based on a contract of employment must be filed within three years. Extension is only possible for claims founded on tort satisfying Sections 27 and 28 of the Limitation of Actions Act, which did not apply here.

p. 2

Legal principles established

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  • Engagement in settlement negotiations does not stop the limitation period from running
  • Section 90 of the Employment Act is in mandatory terms; a contract of service claim must be filed within three years and the period cannot be extended

Court orders

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  1. 1.The Claimant's application for extension of time is declined
  2. 2.The Respondent's Preliminary Objection is upheld
  3. 3.The claim is struck out
  4. 4.Each party will bear their own costs
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act; limitation governed by Section 90 of the Employment Act as read with Section 4(1) of the Limitation of Actions Act

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, "Wachiuri v Agricultural Finance Corporation (Cause E690 of 2023) [2024] KEELRC 2361 (KLR)", Case Analysis (2024). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2361/eng@2024-09-30

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