KENYA SHELL LIMITED V KOBIL PETROLEUM LIMITED

RATIONALE

The court reached its decision based on the interpretation of public policy which posits that it is in the public interest that litigation must come to an end and that this is echoed through the principle of finality of arbitral proceedings present in the Arbitration Act. The court was of the view that there was no realistic prospect of success of the intended appeal nor was there a ground of appeal that merited serious judicial consideration.

CASE RELEVANCE

  • Arbitration is one of the several dispute resolution methods that parties may choose to adopt outside the courts in this country. The parties may either opt for it in the course of litigation under Order XLV of the Civil Procedure Rules or provide for it in contractual obligation in which event the Arbitration Act, Act No. 4 of 1995 would apply, and the courts take a backseat.

The Arbitration Act came into operation in 2ndJanuary 1996. Together with the Arbitration Rules 1997, they repealed and replaced Chapter 49 Laws of Kenya and its rules which had governed arbitration matters since 1968. A comparison of the two pieces of legislation underscores an important message introduced by the latter Act: the finality of disputes and a severe limitation of access to courts. Sections 6,10,12,15,17,18,28,35 and 39 of the Act are particularly relevant in that regard. According to the court, the message is a pointer to the public policy the country takes at this stage in its development.

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