Scholapurkar & 33 others v Mediheal Group Limited & 4 others [2024] KEELRC 13607 (KLR)

Scholapurkar & 33 others v Mediheal Group Limited & 4 others (Cause E042 of 2023) [2024] KEELRC 13607 (KLR) (15 October 2024) (Ruling)

Neutral citation: [2024] KEELRC 13607 (KLR)

Republic of Kenya

In the Employment and Labour Relations Court at Nakuru

Cause E042 of 2023

DN Nderitu, J

October 15, 2024

Between

Tinay Upendra Scholapurkar & 33 others & 33 others & 33 others

Claimant

and

Mediheal Group Limited & 4 others & 4 others & 4 others

Respondent

Ruling

I. Introduction 1. The 34 claimants herein are foreign nationals employed by the 1st, 2nd, and 3rd respondents, limited liability companies duly incorporated in Kenya and owned and or managed by the 4th respondent.

2. The contracts of employment between the claimants and the respondents contain an arbitration clause to the effect that a dispute relating thereto shall be referred for arbitration.

3. However, vide a statement of claim dated 31st August, 2023 the claimants filed this cause in court ostensibly seeking for interim relief under Section 7 of the Arbitration Act and Rule 2 of the Arbitration Rules, 1997.

4. In the statement of claim the claimants are seeking a total of approximately Kshs150,800,800/= against the respondents in salary arrears for an average of six months for each employee. The claimants are seeking – “the claimants intend to refer the dispute to arbitration and pray for costs of and incidental to this claim”. As far as the proceedings indicate, the claimants have so far not referred the matter for arbitration as intimated for the reasons that should become clear in the succeeding parts of this ruling.

5. The court encouraged the parties led by their respective counsel to engage in negotiations with a view of reaching an amicable resolution. On 24th October, 2023 counsel for both sides, Mr. Mailu for the claimants and Mr. Katwa for the respondents, informed the court that they had engaged and drafted a consent dated 23rd October, 2023 that was to settle all the issues between the parties. This consent filed and adopted by the court on 24th October, 2023 provided as follows –1. Consent executed on 4th October, 2023 and adopted by court be varied to the extent set out herein in relevant clauses.2. The 1st, 2nd and 3rd Respondents to remit part of the Claimant’s salaries in the sum of Indian Rupees 29,640,000. 00, or its equivalent in Kenya Shillings, at bank exchange rate, on or before 5. 00 pm, 1st November, 2023. 3.The 1st, 2nd and 3rd Respondents to remit further sum of Indian Rupees 53,854,708. 00 or its equivalent, in Kenya Shillings, at bank exchange rate, on or before 5. 00 pm, 30th November, 2023. 4.All amounts be remitted by real time gross settlement (RTGS)to the account detailed below:Account Name: ADRA Advocates LLP – Client AccountBank Branch: Kilimani Supreme CenterAccount No. xxxxxxxBank Code: 0xxBank Code: xxxSwift Code: EQBLKENA5. All other terms of the consent of 4th October, 2023 not varied by this consent to remain in force.6. Execution to issue forthwith in the event of failure to abide by the terms of this consent.1. The earlier consent dated 4th October, 2024 that is referenced in the above consent had provided as follows –1. An injunction do issue restraining the Respondents whether by themselves, their agents, employees, assigns, servants or any other person claiming under them whatsoever from illegally; suspending, terminating, interfering with and/or intermeddling in any manner whatsoever with the Claimants’ employment.2. An injunction do issue restraining the Respondents whether by themselves, their agents, employees, assigns, servants or any other person claiming under them whatsoever from cancelling and or deporting the Claimants.3. All the 34 Claimants to be paid One (1) Month salary each as per the due amounts in their respective contracts, by 5. 00 pm 21st October 21st October 2023. The amount payable totaling up to Indian Rupees 14,820,000. 00 or its equivalent in Kenya shillings at bank exchange rate. Amount to be remitted by real time gross settlement (RTGS) to the account detailed below:Account Name: ADRA Advocates LLP – Client AccountBank Branch: Kilimani Supreme CenterAccount No. xxxxxxBank Code: 068Bank Code: 147Swift Code: EQBLKENA4. The one-month net payment due on 21st October 2023 be as follows:No. Name One Month’s Salary (Indian Rupees)

Dr. Tanay U. Sholapurkar 1,000,000. 00

Mr. Bobin Thomas Cherian 75,000. 00

Mr. Bhanuprakash Jakkalavadiki 70,000. 00

Dr. Nikita Sharma 400,000. 00

Dr. Rishi Raj Singh 800,000. 00

Mr. Vipin Varghese 70,000. 00

Dr. Nur Diyanah Binti Jaburulla 350,000. 00

Mr. MathewMani Muruganatham Sivanammal 70,000. 00

Dr. Akkenapally Rajendra Prasad 1,000,000. 00

Dr. Sandeep Sharma 700,000. 00

Dr. Vishal Shinde 650,000. 00

Dr. Honey Choudhary 350,000. 00

Dr. Karmugilan Karmegam Subburaj 200,000. 00

Dr. K. P. Naga Arunasiri 400,000. 00

Dr. Lalit Varadpande 900,000. 00

Dr. Murali Mohan Muthyala 525,000. 00

Dr. Rachana Sharma 400,000. 00

Dr. Ramasamy Karthikai Selvi 150,000. 00

Dr. Subhash Ushakoyala 700,000. 00

Dr. Surekha Boreddy Veera 450,000. 00

Mr. Ajish R John 80,000. 00

Mr. Bijo John 110,000. 00

Mr. Ganpat Suthar 110,000. 00

Mr. Hitesh Bhatt 90,000. 00

Mr. Maneesh Mathew 100,000. 00

Mr. Nimeesh Abraham 70,000. 00

Mr. Ribu C. Baby 75,000. 00

Mr. Sarvesh S. Chouhan 70,000. 00

Mrs. Bency P. Kunjumon 50,000. 00

Mrs. Jency George 65,000. 00

Dr. Mohanlal Hiraram Bisnoi 440,000. 00

Dr. Vijaysinh Patil 1,400,000. 00

Dr. ashwin Soni 900,000. 00

Dr. Sunil Dube 2,000,000. 00

Total 14. 820,000. 00

5. Execution to issue forthwith in the event of failure to abide by the terms of this consent.

7. The respondents did not honour the consent and as result the claimants went after various garnishees who held monies for or on behalf of the respondents and substantial sums were recovered in execution of the consent order that was in essence a judgment. As many as 14 garnishees and one interested party have since joined the proceedings. Some of the garnishees who released the attached amounts in full have been discharged.

8. While several applications for and against the garnishees and the interested party were pending rulings, Mr. Katwa for the respondents on 19th September, 2024 informed the court that the respondents were now realistically ready to settle the entire balance due but stated that counsel for the parties had not agreed on the balance due and payable following the payments already made by the various garnishees. The other issue that had not been agreed upon was the exchange rate as the claimants, being foreigners, were apparently ordinarily paid in Indian rupees. By consent between Mr. Katwa and Miss Shah (appearing with Mr. Mailu for the claimants) the court directed parties to file affidavits on the two issues for the court to render a ruling thereon hopefully bringing the matter to its logical conclusion without the need of rulings on the many other applications pending in the matter by some of the garnishees and the interested party.

9. It was also agreed and directed that all the pending applications be held in abeyance as once the payments of the pending balance is made by the respondents there shall be nothing else really left to be heard and determined.

10. This ruling, therefore, is in regard to the two or so issues alluded to above and any other auxiliary issue thereto. In support of their position on the two issues the claimants filed an affidavit sworn by the 1st claimant on 25th September, 2024. The respondents filed an affidavit by Zala Amarsinh Ajitsinh sworn on 20th September, 2024.

11. In their affidavit, the respondent’s representative above deposes that the consent of 23rd October, 2023 entitled the claimants to a sum of Indian Rupees 83,494,708 payable “at bank exchange rates”. It is deposed that at the then prevailing exchange rate the above amount equated to approximately Kshs130,000,000/=.

12. It is pleaded that as at the time of making the oath the claimants had received over Kshs47,873,411/= made up as follows –No. Paid By Amount (KES) Date Of Receipt

1st Garnishee – National Hospital Insurance Fund 23,48,064. 00 18 January 2024

3rd Garnishee – Jubilee Insurance Company Limited 6,973,757. 00 19 January 2024

3rd Garnishee – Jubilee Insurance Company Limited 393,777. 00 26 February 2024

5th Garnishee – AAR Insurance Kenya Limited 627,078. 00 20 May 2024

7th Garnishee – Britam General Insurance Company (Kenya) Limited 1,174,989. 90 2 April 2024

9th Garnishee – CIC General Insurance Limited 1,883,023. 16 23 April 2024

11th Garnishee – Minet Kenya Insurance Brokers Limited 2,139,047. 00 13 April 2024

12th Garnishee – GA Insurance Limited 819,304. 00 17 July 2024

13th Garnishee – Pacis Insurance Company Limited 33,675. 00 19 March 2024

14th Garnishee – Kibabii University 2,871,470. 00 22 August 2024

13. It is therefore deposed that the amount now due and payable to the claimants is Indian Rupees 56,903,137 equivalent to approximately Kshs89,906,956/=.

14. It is deposed that the applicable exchange rate should be the current (obtaining) exchange rate as at the time of the actual payment. It is further deposed that that is the right method to give value of the money to both parties, to enforce the consent order that contemplated payments at the obtaining exchange rate, and that neither party shall suffer prejudice by attaching real value to the money at the obtaining exchange rate. It is deposed that using the exchange rate that obtained as at the time of the consent shall distort the value of the currency and prejudice the respondents who shall be forced to pay more than the market value of the money. The court is urged to apply the Central Bank Exchange rate applicable as at the time of the actual payment or deposit.

15. In their affidavit, which is also in essence a response to the respondents’ affidavit, the claimants state that as of 25th September, 2024 only a total of Kshs39,744,881. 06 had been paid and received and not Kshs47,873,411/= as alleged in the affidavit of the respondents. The said sum is made up as follows –No. Name of Garnishee Amount paid in Kshs Date of Remittance Rate Amount in INR

National Hospital Insurance Fund (NHIF) 23,648,064. 00 19. 01. 2024 1,9288 12,260,506

Medical Administrators Kenya Limited (MAKL)

Jubilee Insurance Company Limited 6,975,757. 00 19. 02. 2024 1. 9288 3,615,594

393,777. 00 26. 02. 2024 1. 7355 226,895

Moi University

AAR Insurance Kenya Limited 627,078. 00 26. 02. 2024 1. 7355 361,324

Madison Group

Britam General Insurance Company (Kenya) Limited 1,174,990. 00 26. 02. 2024 1. 7355 677,032

The CIC Insurance Group Plc

CIC General Insurance Limited 1,883,023. 00 23. 04. 2024 1. 5871 1,186,455

Old Mutual General Kenya Limited

Minet Kenya Insurance Brokers Limited 2,139,047. 00 13. 04. 2024 1. 5645 1,367,240

GA Insurance Limited

PACIS Insurance Company Limited 33,675. 00 13. 04. 2024 1. 5645 21,524

14. Kibabii University 11,000,000. 00 1. 6000 6,875,000

TOTAL 47,873,411. 00 26,591,571

Claim (INR) 83,494,708

Balance (INR) 56,903,137

Balance (Kshs) 89,906,956

16. It is stated that Kibabii University, the 14th garnishee, has only paid Kshs2,871,470/= against a total of Kshs11,000,000/= due and payable from it. It is stated that as a matter of fact this garnishee has not been discharged by the court due to that balance.

17. On the exchange rate applicable, it is deposed that the same should be the rate applicable at the recipient bank as at the time of actual payment or deposit of the funds.

18. It is further deposed that it is the respondents who failed, refused, and or neglected to settle the agreed sum by 30th November, 2023 as per the consent order. This failure led to the claimants taking out execution proceedings by attachment of funds held by the various garnishees.

19. It is deposed that the original consent sum was Kshs166,070,974. 21 and that once the already paid sum of Kshs39,744,881. 06 is deducted the balance due is Kshs126,326,093. 15. The court is urged to refer to an affidavit by the same deponent sworn on 30th May, 2024 which was not disputed by the respondents not withstanding that they were given an opportunity by the court to respond to the same on 11th July, 2024. It is deposed that the balance should attract interest at court rates of 14% per annum from the date of the consent till payment in full.

II. Analysis & Determination 20. In both consents cited and alluded to above the total amount due and payable from the respondents to the claimants was not expressly stated. It is the understanding of the court that the parties were in consensus on the same. The necessary implication is that the parties agreed and were in consensus that the total debt was as pleaded in the claim in the sum of Indian Rupees 83,858,455 equivalent, according to the claimants, to approximately Kshs150,800,800/= as at the date of filing the claim on 1st September, 2023. It is on the that basis and consensus on this amount that the two consents were negotiated, executed, filed, and adopted by the court as its orders.

21. In my view, therefore, the total amount due and payable is not in dispute as that issue was settled in the consents above. Upon the consents being adopted by the court, the amounts became due and payable. Unfortunately, and sadly so, the respondents did not honour their part of the bargain, so to say, which was an obligation and duty imposed by the two adopted consent orders. It is due to that default on the part of the respondents that the claimants commenced execution by way of garnishee proceedings.

22. It is from the garnishees that the claimants have recovered the monies listed in the claimants’ affidavit. The payments received by the claimants as listed have not been disputed except for the amount recovered from or paid by Kibabii University, the 14th garnishee. According to the claimants the said garnishee has only paid Kshs2,871,470/= a payment made on 22nd August, 2024. On the other hand, the respondents have alleged and taken the position that the said garnishee has paid a sum of Kshs11,000,000/= the entire amount that they are holding for the respondents.

23. However, the respondents have not demonstrated or proved that the said 14th garnishee has paid the alleged sum of Kshs11,000,000/=. The claimants have indicated that the amount of Kshs2,871,470/= only was paid on 22nd August, 2024.

24. He who alleges must prove is a basic rule of evidence and the respondents ought to have tendered evidence of the alleged payment of Kshs11,000,000/= by the 14th garnishee. In absence of such evidence the court upholds the position as deposed by the claimants that only Kshs2,871,470/= has been paid and received from the 14th garnishee and this explains why it has not been discharged as per the court record.

25. Now, as noted above and as pleaded by the claimants, the amount claimed in the memorandum is Indian Rupees 83,858,455 “or approximately Kshs150,000,800/= as of the date of filing” the cause. A party is bound by its pleadings and the claimants cannot now shift the claim and allege, as deposed in the affidavit, that the amount due was Kshs166,070,974. 21 or its equivalent in Indian Rupees. If the court was to allow the claimants to shift goals to that extent, the very essence, import, and efficacy of the two consents above shall be lost.

26. In the circumstances, the court shall proceed on the basis that the two consents by the parties alluded to above were entered in the understanding that the amount due and payable to the claimants was as pleaded above and no more. What the claimants have attempted to do by alleging otherwise and by claiming higher figures amounts to unilaterally, unprocedurally, and unlawfully setting aside and or amending the said two consents. The court shall not countenance such a move.

27. With the foregoing background, the computations of the balance due and payable becomes easier. One more thing though. Upon the consent entered and adopted by the court, the amount started or ought to have started earning interest at court rates and more so upon default by the respondents. It should not be lost that the subject matter is salary arrears due and owing to the claimants as employees of the respondents. The respondents are thus liable to pay interest on the amounts due plus interest thereon at court rates, currently at 14% per annum, on reducing balance from the date of the first consent till payment in full. This should be easy to calculate as the claimants have enumerated in a table the amounts paid and the date on which each of the payments was made.

28. The other issue that is for determination is the exchange rate applicable. I am a bit lost as to why the parties and counsel made this such a big issue. However, I gather that this is because the claimants are Indian foreigners who prefer to value the worth of their money in their foreign currency, Indian Rupees. However, the court notes that the contracts of employment between the parties were entered in Kenya and the claimants worked and offered their services in Kenya. Further, the amounts so far paid and received by the claimants have been so paid in the local currency, the Kenya Shilling.

29. In the circumstances, it makes sense that the monies be paid and the claim be settled in the local currency as so far done. However, in case the respondents or any of the garnishees opt to pay in foreign currency, for example the Indian Rupee, the applicable exchange rate shall be the rate applicable at the recipient bank for the claimants as per the details provided for in the consent recorded, as at the time of the actual payment/deposit. In any event, Section 17(1) of the Employment Act provides that salaries, wages, and other emoluments for work or services rendered in Kenya shall be paid “in the currency of Kenya.”

III. Orders 30. Flowing from the foregoing, the court finds and orders as follows –a.That the contracts of employment between the claimants and the respondents were entered in Kenya and the services and work performed by the claimants were executed in Kenya and hence the law governing the same, including the currency in which the salaries, wages, emoluments, and or other benefits payable to the claimants by the respondents and or any other payments for and or on their behalf shall be made in the local currency, the Kenya Shilling.b.That the two consents entered by and between the parties through their respective counsel and adopted by the court on 4th and 24th days of October, 2024 are in force and binding on the parties.c.That the two consents were based and premised on the claimed sum of Indian Rupees 83,858,455 equivalent to approximately Kshs150,800,800/= as at the time of filing of the claim on 1st September, 2023. d.That after the respondents failed, refused, and or neglected to settle the debt as per the consent orders the claimants took out execution by way of garnishee proceedings against the 14 garnishes joined in the cause and various amounts have been recovered and the court hereby agrees and adopts the schedule of payments presented by the claimants in the affidavit alluded to above as the correct figures of the amounts so far recovered.e.That the debt started attracting interest at court rates from the date that the first consent was recorded on 4th October, 2023 and continues so attract interest till payment in full.f.That to calculate the balance due and payable, the parties shall simply take the principal sum of Kshs150,800,800/= and add interest thereon at court rates on a reducing balance based on the amounts recovered as enumerated by the claimants in their affidavit.g.That in case the respondents or any of them or any of the garnishees opt to pay in Indian Rupees or in any other foreign currency the applicable exchange rate shall be the rate obtaining at the recipient bank on that particular date and time of the deposit or payment.h.That once the entire balance due and payable is paid and or recovered, the parties may agree and record a consent on costs or have the issue of costs heard determined by the court.

DATED, DELIVERED VIRTUALLY, AND SIGNED AT NAKURU THIS 15TH DAY OF OCTOBER, 2024. ……………………DAVID NDERITUJUDGE