REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA

AT MOMBASA
CIVIL CASE NO. 1 OF 2000
VICTORIA PUMPS LIMITED
KENYA HAULAGE AGENCY LIMITED…………...…………………………….…
PLAINTIFFS
VERSUS
KENYA PORTS AUTHORITY…...…………………….….…...……………...1ST
DEFENDANT
INCHCAPE SHIPPING SERVICES KENYA LIMITED…………………..…...2ND
DEFENDANT
OCEAN FREIGHT (E.A) LIMITED ………………………….…………..…..3RD
DEFENDANT
MEDITERRANEAN SHIPPING COMPANY (PTY) LIMITED…………………4TH
DEFENDANT
CONSOLIDATED MARINE SERVICE PVT LIMITED …………………...….5TH
DEFENDANT

1ST DEFENDANT’S SUBMISSION

May it please your Honour.
1. These are the humble written submissions of the 1st Defendant with respect to the claim
by Plaintiff and in response to and in opposition to Plaintiff’s Application dated 5 th
November 2020.

A. Preliminary

2. The Plaintiff instituted the suit in respect of 2 containers that the 1st Plaintiff allegedly
imported through the Port of Mombasa, which the 1 st Defendant operates in accordance
with provisions of section 12 of the Kenya Ports Authority Act. The Plaintiffs' suit is
based on allegations that the 1st Defendant failed to carry out its statutory duties and thus
allegedly breaching the duty of care owed to the Plaintiffs, thereby occasioning them
losses.

3. The 1st Defendant, in response to the Further Amended Plaint, filed its Further Amended
Defence and Counterclaim wherein the 1st Defendant disputed the jurisdiction of the
Honourable Court on the basis that the matter should be referred to statutory Arbitration
in the first instance in accordance with the express provisions of section 62 of the Kenya
Ports Authority Act, Chapter 391 of the Laws of Kenya.

4. The Plaintiff then filed an Application seeking an order that the Court has jurisdiction to
handle the matter.

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 B. Issues for determination.

5. Issues that arise for determination, in this case, are as follows:

(a) Whether the matter should be referred to Statutory Arbitration in the first instance?
(b) Whether the Arbitral tribunal can conclusively determine the claim by the Plaintiff
against the Defendants
Your Honour, we wish to address the issues reckoned above as follows:
(a). Whether the Matter Should be Referred to Statutory Arbitration in the First
Instance
6. Your Honour, it is our humble submission that the provisions of section 62 of the KPA
Act postpones the jurisdiction of this Honourable Court but does not in any way oust the
jurisdiction. Section 62 provides for statutory Arbitration for all matters arising from the
1st Defendant where the parties fail to agree on compensation payable for damage
suffered. The provision expressly stipulates;
“In the execercise of the powers conferred by sections 12, 14, 15 and 16, the
Authority shall do as little damage as possible; and where any person suffers
damage, no action or suit shall lie but he shall be entitled to such compensation
thetrefore as may be agreed between him anhd the Authority or, in default of
agreement, as may be determined by a single abitrator appointed by the
Registrar of the Nairobi Centre for International Arbitration established under
the Nairobi Centre for International Arbitration Act, 2013 (No. 26 of 2013)”

7. The Plaintiff refers to Article 165 of the Consitution of Kenya, 2010, which provides for
the jurisdiction of the High Court. Your Honour, in response to the same, the 1 st
Defendant appreciates Article 165 of the Constitution and agrees with the Plaintiff that
the Court has jurisdiction. However, Article 159 (2) of the Constitution of Kenya
entrenches Arbitration into the Kenyan legal system. Section 62 is therefore in perfect
harmony with Articles 159 (2)(c) and 165(6) and (7) of the constitution. In support, the
1st Defendant relies on the Supreme Court decision in Modern Holdings (EA) Limited v
Kenya Ports Authority [2020] eKLR where the Court held, “Far from disentitling an
aggrieved party a remedy, as a matter of fact, the section expressly entitles him
compensation for any damage suffered. While it provides that "no action or suit shall lie,"
it nonetheless authorizes any person suffering damage thereunder to negotiate with the
Kenya Ports Authority a settlement through negotiation failing which then the matter
should be referred to Arbitration.
In the circumstances, Section 62 of the KPA Act is not an ouster clause as the appellant
contended.”

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8. Further, in reference to the Court of Appeal decisions in Kenya Ports Authority v.
Kunston (Kenya) Limited (Unreported), Civil Appeal No. 315 of 2005; Kenya Ports
Authority v. African line Transport Company Limited [2014] eKLR; and the High
Court decision in Safmarine Container N.V of Antwerp v. Kenya Ports
Authority [2012] eKLR in which suits instituted contrary to Section 62 of the KPA Act
were struck out.

9. The instant suit is majorly in respect to 2 containers that the 1st Plaintiff claims to have
allegedly imported through the Port of Mombasa, which the 1 st Defendant operates.
Section 12(e) confers the 1st Defendant power to act as warehousemen and to store goods
whether or not such goods have been or are able to be handled as cargo or carried by
the Authority and to act as carriers of goods or passengers by land or sea which is what
the Plaintiffs allegedly raises their claim.

10. It is the 1st Defendant's submission that the Parties herein were aware that the KPA Act
would govern their engagement. With regard to this proposition, the 1 st Defendant relies
on the case of Wringles Company (East Africa) –v- Attorney General & 3 Others
(2013) eKLR where the Court held:- "that courts cannot re-write what has already
been agreed upon by the parties as set out in the agreement. The parties had agreed
that in the case of a dispute arising as to the validity of the agreement, then the same
would be subject to Arbitration and the Court cannot re-write the same."

11. Similarly, from comparative jurisdiction, the 1st Defendant cites the commentaries
by Halsbury’s Laws of England[1] that;
“An agreement purporting to oust jurisdiction of the Court entirely is illegal and void
on the grounds of public policy. On the other hand, an agreement that no right of
action can be brought in the courts unless and until the parties' differences have been
settled in some other way for example by Arbitration is valid and enforceable.”
12. In response to the issue of Article 50 of the Constitution on fair hearing, the 1 st Defendant
submits that Article 50 in its ordinary meaning provides for a fair and public hearing
before a Court. However, where appropriate, a hearing can be conducted by a subordinate
Court or other independent and impartial tribunal or body established by Article 169 (2).
Arbitrations being subject to the supervisory jurisdiction of the High Court under Article
165(6) and (7), section 62 of the KPA Act cannot be said to be an ouster clause denying
party access to justice.

13. As articulated above, Section 62 of the Kenya Ports Authority does not oust the
jurisdiction of the Court. However, Section 62 of the KPA Act stipulates that the parties
should first seek redress through Arbitration. Your Honour, in reference to the case of
Dock Workers Union Limited v Messina Kenya Limited [2019] eKLR, the Court
therein stated; “that the appellant’s claim which was based on a contract of
employment, was a labour dispute that ought to have been resolved in the first instance

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 in accordance with the parties' arbitration agreement. There was no logic, or
justification in invoking the provisions of the constitution in order to circumvent the
Arbitration agreement."

14. Similarly,  Lenaola, J, (as he then was) in Bernard Murage vs. Fineserve Africa
Limited & 3 others [2015] eKLR he succinctly expressed himself as follows:
“I am bound to follow that principle of law since it flows from the other important
principle that not each and every violation of the law must be raised before the High
Court as a constitutional issue. Where there exists an alternative remedy through
statutory law, then it is desirable that such a statutory remedy should be pursued first.
In that regard, the words of the Court in Harrikinson v Attorney General of Trinidad
and Tobago [1980] AC 265, hold true today as they did then;
“The notion that whenever there is a failure by an organ of Government or a Public
authority or public office to comply with the law this necessarily entails the
contravention of some human rights or fundamental freedoms guaranteed to
individuals by Chapter 1 of the Constitution is fallacious. The right to apply to the
High Court under Section 6 of the Constitution for redress when any human right or
fundamental freedoms is or is likely to be contravened, is an important safeguard of
those rights and freedoms; but its value will  be diminished if it is allowed to be
misused as a general substitute for the normal   procedures for invoking judicial control
of administrative action.”

15. It is the 1st Defendant's submission that the Honorable Court struck out the suit as it is
instituted contrary to section 62 of the KPA Act.

B) Whether the Arbitral Tribunal can Conclusively determine the Claim by the
Plaintiffs.

16. Contrary to the Plaintiff’s argument that Arbitration in this instance is not tenable as the
1st Defendant has been sued jointly and severally, the 1 st Defendant submits that the
statutory provision on Arbitration does not take away the privity of the contract.
Nonetheless, cases involving negligence are an exception to the privity principle.
Therefore, regardless of the number of defendants, the matter can conclusively be heard
and determined before an arbitral tribunal.
17. Section 62 of the Kenya Ports Authority mandates that on compensatory matters, the
same has to go through Arbitration in the first instance to uphold the tenance of Article
169.

18. Based on the precedent on the jurisdiction, we herein pray that the Court struck out the
suit with costs as Section 62 postpones jurisdiction to hear and determine the Plaint.

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 Conclusion

19. That according to section 62 (1) of the Kenya Ports Authority Act, any damage suffered
by way of the 1st Defendant exercising its powers would be settled by Arbitration.

20. The 1st Defendant submits that Arbitration in the first instance is the appropriate
legislatively mandated mechanism for the resolution of this dispute.

DATED at Mombasa this………..……day of…………………………….……….2021.

TURASHA J. KINYANJUI
ADVOCATE FOR THE 1ST DEFENDANT.

DRAWN AND FILED BY

TURASHA J. KINYANJUI
ADVOCATE
KPA, HEADQUARTERS
KIPEVU 6TH FLOOR
P O BOX 95009-80104.
MOMBASA.
EMAIL: lawyers@kpa.co.ke

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