COURT DECLINES TO APPOINT AN ARBITRATOR DUE TO INVOCATION

OF WRONG LAW
By Andrew Halonyere - Advocate
“….had the applicant followed the English law under which the contract had been
prepared, to the letter, it was not necessary to file this case as they would have
proceeded under section 17 to appoint a sole arbitrator and merely notify the other side
of the appointment…..”
Kenya Oil Company Ltd & Kenya Petroluem Ltd v Kenya Petroluem Refineries Ltd
[Eklr 2010] (www.kenyalaw.org)
High Court at Nairobi
M.K. Koome J
July 9, 2010.
The High Court has dismissed an application to hear and determine a dispute between
parties under a processing agreement citing invocation of wrong law. In her ruling, Lady
Justice Koome held that the application was defective as it was premised on the Kenyan
Law yet the agreement was governed by the English law.
The application was brought by Kenya Oil Company Limited and Kobil Petroleum
Limited (plaintiffs) under section 12 of the 1995 Arbitration Act and Rule 3(1) of the
Arbitration Rules of 1997, seeking orders that the High Court do appoint a single
Arbitrator to hear and determine a dispute between the plaintiffs and Kenya Petroluem
Refineries Limited (defendant) under the processing agreement. The plaintiffs also
sought conservatory orders and gave a list from which the High Court could appoint a
sole Arbitrator.
The plaintiffs alleged that they entered into the processing agreement with Kenya
Petroluem Refineries Limited, and according to them, the defendant breached the
contract when they issued a notice to terminate the processing agreement without giving
any reasons. As such, the plaintiffs sought that the dispute be referred to arbitration,
which however was declined by the defendant. The Plaintiff’s case was that the
defendant’s refusal to appoint an arbitrator to hear and determine the dispute declared by
the plaintiff was a breach of the plaintiffs’ contractual and statutory obligations to have
all disputes under the contract determined through an arbitrator. He argued that the
allegation by the defendant that there was no dispute was usurpation of the arbitrators
function and would prejudice the out come of the dispute and obstruct the arbitration
proceedings, that under the arbitration Act, it was unlawful for one party to refuse to
participate in the appointment of an arbitrator since the the agreement clearly provided
for an arbitration clause hence, one party could not therefore obstruct the arbitration
proceedings.
Further, the plaintiff stated that for the court to rule that there was no dispute, as had
been contended by the defendants, it would infringe on the plaintiffs fundamental rights
to a fair trial and access to justice because that would be tantamount to blocking the
plaintiff from ventilating their dispute according to the agreement through an arbitrator.
It was also the Plaintiff’s case that the reason as to why the plaintiffs had applied for
conservatory orders was precipitated by the defendant’s attempt to exclude the plaintiff
from participating in an open tender process for the importation of the fuel.
The defendant, in opposing the application submitted that there was no dispute between
the parties capable of being referred to arbitration, arguing that the application was filed
under the provisions of section 12 of the Arbitration Act and Rule 3(1) of the Arbitration
Rules of 1997, whereas the processing agreement the subject matter herein, provided that
the arbitration was to be in accordance with the English Arbitration Act 1950 or an
enactment thereof for the time being in force. Further that the English Arbitration Act
1996 was the applicable law and it was different from section 12 of the Kenyan
Arbitration Act in the sense that a decision of the High Court in respect of appointment of
an arbitrator, could be appealed against, with the leave of the court, whereas, under the
Arbitration Act 1995, the Court’s appointment of an arbitrator was final and the decision
could not be appealed against..
On the issue of whether there was a dispute, the defendant submitted that section 6(1) of
the English Arbitration Act of 1995, provided that a court may refer parties to arbitration
unless it found that there was no dispute between the parties. According to the defendant,
the agreement provided that either party could determine the contract by giving a notice
of not less than 12 months and that the plaintiffs had earlier issued a notice pursuant to
the same clause which clearly demonstrated that the party’s rights to terminate the
contract were completely unfettered as long as the requisite notice was given.
It was the defendant’s case that even if there was a dispute it was one of law, which
should not be determined by an arbitrator but by the court and that nothing stopped the
court in determining whether there existed a dispute or not under the English Arbitration
Act. In the defendant’s view that it could not have obstructed the arbitral proceedings
merely by pointing out that there was no dispute.
The issues for determination before the court were; whether it would appoint an arbitrator
and proceed to issue an interim order of injunction to preserve the status quo pending the
determination of the dispute by the arbitrator.
Justice Koome having analyzed the submissions by both parties noted that the Kenyan
Arbitration Act varied with the English Act, and that had the plaintiffs followed the
English Act, especially the provisions of sections 17, this application would not have
been necessary, because there was a provision for the appointment of an arbitrator and if
two parties fail to agree on the appointment of a sole arbitrator, and one party refuses or
fails to agree to appoint an arbitrator within a specified time, the other party may appoint
his arbitrator as a sole arbitrator who can proceed with the arbitration.
The Court concurred with the defendant that the English Arbitration Act, 1996 was
applicable to this case as per the agreements, and held that the application was defective
as it was premised on the Kenyan law not the English law which was provided for in the
agreement. The court further noted that if it followed the provisions cited in the
application, it would lead to an erroneous decision because under the Kenyan law, the
decision of the High Court was final. Lady Justice Koome also added that the other
reason why she could not appoint an arbitrator was because the qualifications of the
suggested names were not provided so as to guide it on whom to appoint based on the
relevant skill and that was why the procedure of the appointment of the sole arbitrator
was so elaborately provided to give room for objective selection.
On the question of issuance of conservatory orders, under the Arbitration Act, the court
held that these proceedings were not governed by the Kenyan Arbitration Act, the
agreement had a termination clause and notice given to the plaintiffs was according to the
agreement, hence, there was no prima facie case to warrant court to issue the
conservatory orders. The application was thus disallowed with cost to the defendant
 Vol CXII – No .69 Dated July 16,2010

GAZETTE NOTICE NO. 8068

THE RATING ACT (Cap. 267)
THE MUNICIPAL COUNCIL OF MERU

APPOINTMENT OF VALUER

IN EXERCISE of the powers conferred by section 7 of the Rating Act, the

Deputy Prime Minister and Minister for Local Government, approves the appointment
of –

DANIEL M. KIBUCHI

As valuer to prepare the Draft Valuation Roll for Municipal Council of Meru.

Dated the 8th July, 2010.

MUSALIA MUDAVADI,
Deputy Prime Minister and
Minister for Local Government
 GAZETTE NOTICE NO. 8069
THE RATING ACT (Cap. 267)
THE MUNCIPAL COUNCIL OF MERU

SITE VALUE RATE

IN EXERCISE of the powers conferred by section 4 (10) (b) of the Rating Act,
the Deputy Prime Minister and Minister for Local Government, approves adoption by
Municipal Council of Meru of undeveloped “site value” for purposes of levying rates.

Dated the 8th July, 2010.

MUSALIA MUDAVADI,
Deputy Prime Minister and
Minister for Local Government
 GAZETTE NOTICE NO. 8070
THE VALUATION FOR RATING ACT (Cap. 266)
THE MUNICIPAL COUNCIL OF MERU

TIME OF VALUATION

IN EXERCISE of the powers conferred by section 6 of the Valuation for Rating Act, the
Deputy Minister and Minister for Local Government gives approval to the Municipal
Council of Meru’s Resolution under Min. No. SP.FSGP/29/2010 as follows:

“That the time of valuation for the Municipal Council of Meru’s Valuation Roll
shall be 31st December, 2009”.

Dated the 8th July, 2010.

MUSALIA MUDAVADI,
Deputy Prime Minister and
Minister for Local Government
 GAZETTE NOTICE NO. 8071
THE VALUATION FOR RATING ACT (Cap. 266)
THE MUNICIPAL COUNCIL OF MERU

DECLARATION

IN EXERCISE of the powers conferred by section 6 of the Valuation for Rating

Act, the Deputy Prime Minister and Minister for Local Government declares that “valuer
in preparing any Draft Valuation Roll or draft Supplementary Valuation Roll, need
neither value nor include in the roll the value of the land or the assessment for
improvement rate, as required by paragraphs (c) and (e) respectively of this section”.

Dated the 8th July, 2010.

MUSALIA MUDAVADI,
Deputy Prime Minister and
Minister for Local Government.
 GAZETTE NOTICE NO. 8072
THE NATIONAL MUSEUMS AND HERITAGE ACT (No. 6 of 2006)
APPOINTMENT

IN EXERCISE of the powers conferred by section 6 of the National Museums

and Heritage Act, 2006, the Minister for State for National Heritage and Culture
appoints-

SWALEH SAUDA M. (DR.)

to be a member of the National Museums of Kenya Board, for a period of three (3) years,
with effect from 2nd July, 2010.

Dated the 5th July, 2010.

WILLIAM OLE NTIMAMA,

Minister of State for National Heritage and Culture
 GAZETTE NOTICE NO. 8073
THE NATIONAL MUSEUMS AND HERITAGE ACT (No. 6 of 2006)

DECLARATION OF A NATIONAL MONUMENT

IN EXERCISE of the powers conferred by section 25 (1) (b) of the National

Museums and Heritage Act, the Minister of State for National Heritage and Culture in
consultation with the National Museums, declares the building specified in the schedule
which he considers to be of historical interest to be a monument within the meaning of
the Act.

Any objection to the declaration shall be lodged with the Minister within two months
from the date of publication of this notice.

SCHEDULE
PUMWANI COMMUNITY MEMORIAL HALL

All that building known as the Pumwani Community Memorial Hall, on L.R. No.
209/2378/9 measuring approximately one-acre, situated within Pumwani Majengo
Location, in Nairobi North District, Nairobi Province.

Dated the 5th July, 2010.

WILLIAM OLE NTIMAMA,

Minister of State for National Heritage and Culture
 GAZETTE NOTICE NO. 8074
THE STATE CORPORATIONS ACT (Cap. 446)
KENYA SEED COMPANY LIMITED

APPOINTMENT

IN EXERCISE of the powers conferred by section 6 (1) (e) of the State

Corporations Act, the Minister for Agriculture appoints-

JUSTINE N. SITTI (MRS)

to be a member of the Board of the Kenya Seed Company, for a period of three (3) years,
with effect from 1st July, 2010.

Dated the 30th June, 2010.

S.J. KOSGEI
Minister for Agriculture
 GAZETTE NOTICE NO. 8075
THE STATE CORPORATIONS ACT (Cap. 446)
CHEMILIL SUGAR COMPANY LIMITED

APPOINTMENT

IN EXERCISE of the powers conferred by section 6 (1) (b) of the State

Corporations Act, the Minister for Agriculture appoints –

ROBERT ILTARAMATWA KOCHALE

to be a member of the Board of the Chemilil Sugar Company, for a period of three (3)
years, with effect from 1st July, 2010.

Dated the 30th June, 2010.

S.J. KOSGEI
Minister for Agriculture
 GAZETTE NOTICE NO. 8076
THE SCIENCE AND TECHNOLOGY ACT (Cap. 250)

APPOINTMENT

IN EXERCISE of the powers conferred by section 15 (1) (f) of the Science and
Technology Act, The minister for Agriculture appoints-

KARWITH KIUGU (PROF.)

to be a member of the Board of the Management of Kenya Agricultural Research

Institute, for a period of three (3) years, with effect from 1st July, 2010.

Dated the 30th June, 2010.

S.J. KOSGEI
Minister for Agriculture
 GAZETTE NOTICE NO. 8077
THE WILDLIFE (CONSERVATION AND MANAGEMENT) ACT (Cap. 376)

DECLARATION OF A WILDLIFE SACTUARY

IN EXERCISE of the powers conferred by section 19 (1) of the Wildlife

(Conservation and Management) Act, the Minister for Forestry and Wildlife declares the
area specified in the schedule to be a wildlife sanctuary.

SCHEDULE

LAKE ELEMENTAITA WILDLIFE SANCTUARY

All that area of land measuring approximately 2533.9 hectares situated within south-east
of Nakuru Town, Nakuru District. Rift Valley Province, boundary plan No. 216/67,
which is signed, sealed and deposited at the Survey Records Office, Survey of Kenya,
Nairobi, and a copy of which may be inspected at the office of the Director, Kenya
Wildlife Service, Nairobi.

Dated 6th July, 2010.

N.M. WEKESA
Minister for Forestry and Wildlife.
 GAZETTE NOTICE NO. 8078
THE LAW REFORM COMMISSION ACT (Cap. 3)

APPOINTMENT

IN EXERCISE of the powers conferred by section 2 (6) of the Law Reform

Commission Act, the Attorney-General appoints-

JOASH ODHIAMBO DACHE

To be secretary to the Kenya Law Reform Commission.

Dated the 9th July, 2010.

S.A. WAKO,
Attorney-General
 GAZETTE NOTICE NO. 8079
THE PUBLIC PROCUREMENT AND DISPOSAL ACT (No. 3 of 2005)

APPOINTMENT

IN EXERCISE of the powers conferred by section 26 (4) of the Public

Procurement and Disposal Act, 2005 and second schedule of the Public Procurement and
Disposal Regulations, 2006, the Permanent Secretary, Ministry of Justice, National
Cohesion and Constitutional affairs appoints –

AMB. DAVID M. MUTEMI

to be the Chairman of the Ministerial Tender Committee, with immediate effect for the
financial year 2010/2011.

Dated the 9th July, 2010.

A.C. MOHAMED,
Permanent Secretary.
 GAZETTE NOTICE NO. 8385
THE PHYSICAL PLANNING ACT
(No. 6 of 1996)

COMPLETION OF PART DEVELOPMENT PLAN

(PDP No. TRD/1355/2010/04 for Proposed Site for Sheikh Bulle

Farah Abagada Islami Centre)

NOTICE is given that the above-mentioned part development plan was completed
th
on 15 May, 2010.
The part development plan relates to land situated within Minjla Town, Tana
Delta District.

Copies of the part development plan have been deposited for public inspection at the
offices of the District physical planning Officer, Tana Delta, District Commissioner, Tana
Delta, County Clerk, County Council of Tana River.

The copies so deposited are available for inspection free of charge by all persons
interested at offices of the District Physical Planning Officer, Tana Delta, District
Commissioner, Tana Delta, County Clerk, County Council of Tana River, between the
hours of 8.00 a.m. to 5.00 p.m. Monday to Friday.

Any interested person who wishes to make any representation in connection with or
objection to the above-named part development plan may send such representations or
objections in writing to be received by the District Physical Planning Officer, P.O. Box
201, Hola, within sixty (60) days from the date of publication of this notice and such
representation or objection shall state the grounds on which it is made.

Dated the 15th June, 2010.

J.M. MUTINDA,
For Director of Physical Planning
 GAZETTE NOTICE NO. 8386
THE ENVIRONMENTAL MANAGEMENT AND
CO-ORDINATION ACT (No. 8 of 1999)
THE NATIONAL ENVIRONMENT MANAGEMENT AUTHORITY
ENVIRONMENTAL IMPACT ASSESSMENT STUDY
REPORT FOR THE PROPOSED VOI-TAVETA 132Kv SINGLE CIRCUIT
TRANSMISSION LINE

INVITATION OF PUBLIC COMMENTS

PURSUANT to regulation 21 of Environmental (Impact Assessment and Audit)

Regulations, the National Environment Management Authority, (NEMA) has received an
environmental impact assessment study report for the proposed Voi-Taveta 132 kV
Single Circuit Transmission Line.

The construction of the transmission line will involve the following activities:

• Valuation and compensation of affected people’s property and

resettlement

• Land acquisition to accommodate line’s 30 m wide Right of Way (ROW)

along the 110 km route;

• Excavation of the foundations of the tower pads;

• Construction of tower pad foundation;

• Mounting of the towers on the pads and

• Stringing of the conductors over the entire distance;

• Rehabilitation of any disturbed areas;

The proposed site starts from Voi Town located on the Mombasa-Nairobi Highway and
runs westwards through Mwatate, Maktau to Taveta town covering a total distance of 110
km. crossing through three (3) new created districts namely Voi, Mwatate and Taveta
which resulted from the subdivision of the former Taita Taveta District, Coast Province.

The project anticipates the impacts and mitigation measures set out in the gazette.

The full report of the proposed project is available for inspection during working hours
at:

(a) Director-General the National Environment Management Authority (NEMA),

Kapiti Road, off Mombasa Road, P.O. Box 67839-00200, Nairobi
 (b) Permanent Secretary, Ministry of Environment and Mineral Resources, N.H.I.F.
Community, P.O. Box 30521, Nairobi.

(c) Provincial Director of Environment, Coast Province.

(d) District Environment Officer, Voi District.

(e) District Environment Officer, Mwatate District.

(f) District Environment Officer, Taveta District

The National Environment Management Authority invites members of the public to

submit oral or written comments within thirty (30) days from the date of publication of
this notice to the Director-General, NEMA, to assist the Authority in the approval process
of the project.

WILKISTER MAGANGI,
For Director-General,
National Environment Management Authority
 GAZETTE NOTICE NO. 8387
THE ENVIRONMENTAL MANAGEMENT AND
CO-ORDINATION ACT (No. 8 of 1999)
THE NATIONAL ENVIRONMENT MANAGEMENT AUTHORITY
ENVIRONMENTAL IMPACT ASSESSMENT STUDY
REPORT FOR THE PROPOSED RESETTLEMENT PROGRAMME IN
CHEPYUK PHASE II AND III SETTLEMENT SCHEME IN MOUNT
ELGON DISTRICT

INVITATION OF PUBLIC COMMENTS

PURSUANT to regulation 21 of Environmental (Impact Assessment and Audit)

Regulations, the National Environment Management Authority, (NEMA) has received an
environmental impact assessment study report for the proposed resettlement programme.

The project is for the proposed degazettement and excision of Chepyuk Phase II and IIII
Settlement Scheme from Mt. Elgon Forest Reserve which has been considered by the
Government for the purposes of resettlement among other tasks. A total of 7,750 hectares
were authrorized by the Government to comprise Chepyuk Settlement Scheme Phase I, II
and III.

The proposed project is located in Chepyuk Location, Kopsiro Division in Mt. Elgon
District, Western Province. Phase II lies in Korongotuny, and partly in Kabura Sub-
locations while Phase III lies in Emi and Chepyuk, Kaimugul and partly Kabura Sub-
Locations.

The project anticipates the impacts and mitigation measures set out in the gazette.

The full report of the proposed project is available for inspection during working hours
at:

(a) Director-General the National Environment Management Authority (NEMA),

Kapiti Road, off Mombasa Road, P.O. Box 67839-00200, Nairobi

(b) Permanent Secretary, Ministry of Environment and Mineral Resources, N.H.I.F.

Community, P.O. Box 30521, Nairobi.

(c) Provincial Director of Environment, Western Province.

(d) District Environment Officer, Mt. Elgon District.

The National Environment Management Authority invites members of the public to

submit oral or written comments within thirty (30) days from the date of publication of
this notice to the Director-General, NEMA, to assist the Authority in the approval process
of the project.
 B.M. LANGWEN,
For Director-General,
National Environment Management Authority
 GAZETTE NOTICE NO. 8388
THE ENVIRONMENTAL MANAGEMENT AND
CO-ORDINATION ACT (No. 8 of 1999)
THE NATIONAL ENVIRONMENT MANAGEMENT AUTHORITY
ENVIRONMENTAL IMPACT ASSESSMENT STUDY
REPORT FOR THE PROPOSED LAKE VICTORIA ECOLODGE IN KISUMU
IMPALA SACTUARY, KENYA

INVITATION OF PUBLIC COMMENTS

PURSUANT to regulation 21 of Environmental (Impact Assessment and Audit)

Regulations, the National Environment Management Authority, (NEMA) has received an
environmental impact assessment study report for the proposed Lake Victoria Eco lodge.

The proposed project will be 24-bed high-end luxury eco-lodge at the site to offer tourist
accommodation, catering services and act as a base for various tourist activities within
the Sanctuary and will include:

• Reception and lounge,

• Restaurant and bar,

• Visitor information and interpretation Centre,

• Gift shop.

• “Obama” Dhow

The proposed project is located within the Kisumu Impala Sanctuary in Nyanza Province

The project anticipates the impacts and mitigation measures set out in the gazette.

The full report of the proposed project is available for inspection during working hours
at:

(a) Director-General the National Environment Management Authority (NEMA),

Kapiti Road, off Mombasa Road, P.O. Box 67839-00200, Nairobi

(b) Permanent Secretary, Ministry of Environment and Mineral Resources, N.H.I.F.

Community, P.O. Box 30521, Nairobi.

(c) Provincial Director of Environment, Nyanza Province.

(d) District Environment Officer, Kisumu District.

The National Environment Management Authority invites members of the public to
submit oral or written comments within thirty (30) days from the date of publication of
this notice to the Director-General, NEMA, to assist the Authority in the approval process
of the project.

B.M. LANGEWEN
For Director-General,
National Environment Management Authority
SUPPLEMENT NO. 43
Legislative Supplement

99–103–The Registered Land (Application) (Nos. 5-9) Orders, 2010

104–The Privileges (New Partnership for African Red Cross and Red Crescent Societies)
Order, 2010
105– The food, Drugs and Chemical Substances ( Food Labelling, Additives and
Standards) (Amendment) Regulations, 2020
106– The Traffic Act – Exemption
107– The National Hospital Insurance Fund (Standard and Special Contributions)
(Amendment) Regulations, 2010
108–The national Hospital Insurance Fund (Voluntary Contributions)
(Amendment)Regulations, 2010

SUPPLEMENT NO. 44
Bills, 2010

The tea (Amendment) (No. 2) Bill, 2010.