Kenya
In your jurisdiction, are there any formal ADR procedures available for resolving commercial disputes other than litigating (or arbitrating) to a final hearing?
Yes. Court annexed mediation was recently introduced through formal amendments to the Civil Procedure Rules. The court registrar is mandated to screen all fresh matters and if appropriate, refer them to mediation as a pre-condition to commencing the formal court process. The mediation process must be completed within a period of 60 days failure to which, the formal court process is then allowed to continue.
Does engaging in ADR have any effect on potential or existing litigation or arbitration?
Other than to suspend the litigation or arbitration process during the 60 day period required to engage in mediation, there is no effect.
Is ADR compulsory and if so are there any consequences if a party fails to engage in ADR? If it is not compulsory are there any plans for this to change?
Through amendments to the Kenyan Constitution, ADR was given prominence and all courts enjoined to promote ADR measures, including reconciliation, mediation and traditional dispute resolution mechanisms. However, ADR is not compulsory and remains elective. There are therefore no manifest consequences if a party fails to engage in ADR.
Can the parties agree, in advance of any potential dispute, to engage in ADR?
Parties are at liberty to include in their contracts a dispute resolution clause that may exclude the formal court process and provide for a tiered dispute resolution mechanism, ordinarily reconciliation, mediation and lastly, arbitration. It is indeed very common to have such dispute resolution clauses in Kenya.
When does ADR generally take place?
In the context of initiated court proceedings, ADR will take place as soon as the case is screened for mediation by the mediation registrar and, if deemed suitable, referred to mediation. In the context of non-court proceedings, ADR would take place in line with the provisions of the dispute resolution clause in the contract, which would ordinarily provide for a declaration of a dispute, a time bound reconciliation process, a time bound mediation process and ultimately arbitration through an arbitrator appointed by a named appointing authority, all in that order.
Is ADR subject to without prejudice privilege and/or confidential? If not, is there any other means to protect confidential information?
All ADR processes are considered confidential in their nature and indeed, by law, any information obtained during a mediation exercise cannot be used in any subsequent proceedings. Arbitration is similarly confidential to a large extent but this confidentiality is somewhat limited at the enforcement stage – as a party is required to apply to court for recognition of the arbitral award, at which stage, the information submitted to court (ordinarily being the arbitral award itself) becomes public information and accessible to the general public. As it is today, our court system does not have a mechanism in place of marking records as confidential. Non-Disclosure Agreements (NDA’s) are recognized in Kenya and indeed, commonly entered into but it is very rare for any litigation to be initiated seeking to either enforce an NDA or seek compensation for breach of an NDA.
Does the output from ADR create precedents?
No. ADR does not create any precedent as it is a private process which is meant to have parties resolve their dispute keeping in mind the unique circumstances of their case.
Who bears the costs of ADR?
As a general rule, costs follow the event in arbitration. Therefore, the loser invariably bears the costs in arbitration. Mediation is somewhat less formal and as a result, each party bears its own costs unless agreed otherwise between the parties.
Is your jurisdiction subject to any specific rules for cross border ADR?
No. Kenya is not subject to any specific rules for cross boarder ADR. Kenya is not a party to the United Nations Convention on International Settlement Agreements Resulting from Mediation (Singapore Convention).
Are there any particularly unusual features of ADR in your jurisdiction that you are aware are different to other jurisdictions?
The law requires formal registration for mediators who are then entered into a “mediators register” and can then formally be appointed as mediators through the court-annexed mediation process. However, parties are at liberty, outside of that formal court -annexed mediation process, to consent to appointing a mediator who is not accredited – the intention being to allow parties have a mediator that they are both comfortable with.
Similarly, depending on the identified appointing authority set out in the dispute resolution clause, an arbitrator must be registered with the appointing authority as a prerequisite to being appointed as arbitrator. Different appointing authorities do have differing criteria for certification which must be met.
No disputes are prohibited from using ADR.
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