The High Court has quashed a decision of the Retirement Benefits Appeal Tribunal to award former employees of the National Bank of Kenya (NBK) Sh136 million in terminal dues.
The court found that the tribunal did not grant the bank a fair hearing by failing to consider the replying affidavit filed by the company Secretary, Habil Waswani, before issuing the ruling dated February 13, 2017.
“Such a decision, which is one-sided whether by inadvertence or deliberately, gives rise to perceived bias which may justify interference by this court exercising judicial review jurisdiction. This is because the doctrine ‘audi alteram partem’, a Latin phrase that means ‘hear the other side’ or ‘let the other side be heard as well’, is a fundamental principle of natural justice and procedural fairness,” said Justice Roseline Aburili.
NBK was acquired by KCB in 2019 and sold to Nigeria's Access Bank in March 2024.
In the contested ruling dated February 13, 2017, the tribunal had directed the National Bank of Kenya Staff Retirement Benefits Scheme and National Bank of Kenya Staff Pension Fund Registered Trustees to pay the 82 retirees their unpaid pension as per the actuarial valuation conducted by NBC valuers.
The pensioners were former employees of NBK and were members of the NBK Staff Retirement Benefits Scheme.
In that capacity, they were entitled to their pension benefits as provided in the trust deed and rules of the scheme.
Upon ceasing to be employees of the Bank, they were paid their benefits, but they protested that their pension benefits were not calculated as per the scheme rules. They filed a complaint before the Retirement Benefits Authority (RBA).
Their complaint was dismissed, but the Retirement Benefits Appeal Tribunal allowed their appeal, and a report of the Actuary was adopted.
The order for payment of the dues stemmed from an application by the pensioners for a decree in the sum of Sh136 million and warrants of execution.
The case has been in litigation since the tribunal’s 2017 ruling, culminating in this High Court decision.
Justice Aburili found that the tribunal acted unprocedurally because at the time of the ruling, there was a pending application seeking to vary a consent judgment entered earlier between the parties.
“The Tribunal’s ruling of February 13, 2017 is procedurally improper, leading to procedural impropriety. I find that the Tribunal acted irregularly in by-passing the consent order and in addressing the application for execution, which was not based on the consent,” the judge said.
The judge further found that the issuance of such a ruling amounted to a jurisdictional overreach and a breach of the bank’s right to a fair administrative action and process guaranteed under the Constitution.
The judge made the findings following an application by the National Bank of Kenya Staff Retirement Benefits Scheme and National Bank of Kenya Staff Pension Fund Registered Trustees, protesting that the tribunal acted beyond its authority.
They also complained that they were not accorded a fair hearing because the tribunal failed to consider a replying affidavit filed by Habil Waswani, the Company Secretary of National Bank, the applicants’ sponsor.
The retirees opposed the application, arguing that the contested ruling was within the tribunal's powers.
They described the process as futile and claimed that the applicants were trying to prevent them from benefiting from the ruling delivered in their favour.
However, the court ruled that the contested decision did not adhere to the principle that no person shall be condemned without being heard.
“The Tribunal acted outside the scope of its powers and in a manner that undermines procedural fairness and, as a result, breached the legal rights of the applicants to be heard fairly as guaranteed under Article 50(1) of the Constitution, besides violating the applicants’ legitimate expectations. In such circumstances, judicial review is available as a corrective mechanism,” said Justice Aburili.
The judge noted that the Tribunal’s ruling was delivered while an application to review the consent order was still awaiting a hearing.
As a result of the judgment, the court directed the Tribunal to prioritise the hearing and determination of the application filed by the pensioners seeking to vary the consent order dated April 8, 2016. The court ruled that the matter should be resolved within 60 days.
