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27 June 2002
This update examines the enforcement of foreign arbitral awards against the government of the Republic of Kenya. The Kenyan Arbitration Act (4/1995), which is broadly based on the United Nations Commission on International Trade Law Model Law, makes specific provision for the recognition and enforcement in Kenya of foreign arbitral awards. Recognition and enforcement may be refused only on the specified grounds set out in the act. An application to set aside an arbitral award must be made within three months of the date on which the party making the application receives notice of recognition. However, once an arbitral award has been recognized, its enforcement against the Kenyan government is covered by a process that is quite different from the remedies of execution that are usually available.
Under the provisions of Order 28 of the Civil Procedure Rules, an order against the Kenyan government is defined as:
"any order (including a judgment, decree, rule, award, declaration and an order for costs) made in civil proceedings brought by or against the government, or in connection with any arbitration to which the government is a party, in favour of any person against the government or against a government department or against a public officer as such."
Order 28 specifically excludes orders against the Kenyan government for impounding of documents, execution of decrees and orders, attachment of debts or appointments of receivers.
The Government Proceedings Act (Cap 40 Laws of Kenya) sets out the law relating to the civil liabilities and rights of the Kenyan government, and to civil proceedings by and against the Kenyan government. It also states the law relating to the civil liabilities of persons other than the Kenyan government in certain cases that involve the affairs or property of the Kenyan government.
For purposes of execution, the relevant law is to be found in Section 21(1) of the Government Proceedings Act, which states as follows:
"Where in any civil proceedings by or against the government, or in proceedings in connection with any arbitration in which the government is a party, any order (including an order for costs) is made by any court in favour of any person against the government, or against a government department, or against an officer of the government as such, the proper officer of the court shall, on an application in that behalf made by or on behalf of that person at any time after the expiration of 21 days from the date of the order or, in case the order provides for the payment of costs and the costs require to be taxed, at any time after the costs have been taxed, whichever is the later, issue to that person a certificate in the prescribed form containing particulars of the order."
An application to the court for the issue of a certificate in the prescribed form is made ex parte to the registrar.
This certificate must be served on the attorney general, who will pass it on to the relevant government department. Section 21(3) of the Government Proceedings Act states:
"If the order provides for the payment of any money by way of damages or otherwise, or of any costs, the certificate will state the amount so payable, and the accounting officer of the government department concerned shall, subject as hereinafter provided, pay to the person entitled or to his advocate the amount appearing on the certificate to be due to him together with interest, if any, lawfully due thereon."
This proviso is couched in mandatory terms. Once the certificate is issued and served, the relevant Kenyan government accounting officer must comply with the terms of the certificate. If he fails to do so, then he is effectively in breach of a statutory duty and the person in whose favour the order has been made has the right to make an application for judicial review.
The application for judicial review must be brought expeditiously, and leave of the court must be obtained before the main application can be filed. In this instance the order to be sought would be an order of mandamus.
Mandamus is a prerogative order issued in certain cases to compel the performance of a duty. It is issued where the injured party has a right to have something done and has no other specific means of compelling its performance, especially when the obligation arises out of the official status of the respondent. Thus, it is used to compel public officers to perform duties imposed upon them by common law or by statute.
Mandamus would be invoked where a judgment has been rendered valueless by the accounting officer's refusal to perform his statutory duty under Section 21(3) of the Government Proceedings Act, a duty of an imperative nature cast upon him by statute, in the fulfilment of which duty the applicant has an interest as a subject of the state.
Once the order is obtained and served on the official, he must comply with it. Failure to do so will constitute contempt, and the court will issue a warrant of arrest and commit the recalcitrant government officer to civil jail until he complies with the order.
For further information on this topic please contact Sheetal Kapila at Kapila Anjarwalla & Khanna Advocates by telephone (+254 2 337625) or by fax (+254 2 337620) or by email (firstname.lastname@example.org).
Appendix 1: Part 7 of the Arbitration Act
Recognition and enforcement of awards
"36.(1) An arbitral award, irrespective of the state in which it was made, shall be recognized as binding and, upon application in writing to the High Court, shall be enforced subject to this section and Section 37.
(2) Unless the High Court otherwise orders, the party relying on an arbitral award or applying for its enforcement shall furnish -
(a) the duly authenticated or original arbitral award or a duly certified copy of it; and
(b) the original arbitration agreement or a duly certified copy of it.
(3) If the arbitral award or arbitration agreement is not made in the English language, the party shall furnish a duly certified translation of it into the English language."
Grounds for refusal of recognition or enforcement
"37. (1) The recognition or enforcement of an arbitral award, irrespective of the state in which it was made, may be refused only:
(a) at the request of the party against whom it is invoked, if that party furnishes to the High Court proof that -
(i) a party to the arbitration agreement was under some incapacity; or
(ii) the arbitration agreement is not valid under the law to which the parties have subjected it or, failing any indication of that law, under the law of the state where the arbitral award was made; or
(iii) the party against whom the arbitral award is invoked was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his case; or
(iv) the arbitral award deals with a dispute not contemplated by or not falling within the terms of the reference to arbitration, or it contains decisions on matters beyond the scope of the reference to arbitration, provided that if the decisions on matters referred to arbitration can be separated from those not so referred, that part of the arbitral award which contains decisions on matters referred to arbitration may be recognized and enforced; or
(v) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties or, failing any agreement by the parties, was not in accordance with the law of the state where the arbitration took place; or
(vi) the arbitral award has not yet become binding on the parties, or has been set aside or suspended by a court of the state in which, or under the law of which, that arbitral award was made; or
(b) if the High Court finds that -
(i) the subject matter of the dispute is not capable of settlement by arbitration under the law of Kenya; or
(ii) the recognition or enforcement of the arbitral award would be contrary to the public policy of Kenya.
(2) If an application for the setting aside or suspension of an arbitral award has been made to a court referred to in Subsection (1)(a)(vi), the High Court may, if it considers it proper, adjourn its decision and may also, on the application of the party claiming recognition or enforcement of the arbitral award, order the other party to provide appropriate security."
Appendix 2: The Arbitration Rules 1997
"4. (1) Any party may file an award in the High Court.
(2) All applications subsequent to filing of an award shall be by summons in the cause in which the award has been filed and shall be served on all parties at least seven days before the hearing date.
(3) If an application in respect of the arbitration has been made under Rule 3(1) the award shall be filed in the same cause; otherwise the award shall be given its own serial number in the civil register.
(5) The party filing the award shall give notice to all parties of the filing of the award, giving the date thereof and the cause number and the registry in which it has been filed, and shall file an affidavit of service.
(6) If no application to set aside an arbitral award has been made in accordance with Section 35 of the act the party filing the award may apply ex parte by summons for leave to enforce the award as a decree.
(7) An application under Section 35 of the act shall be supported by an affidavit specifying the grounds on which the party seeking to set aside the arbitral award and both the application and affidavit shall be served on the other party and the arbitrator."
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