GAZETTE NOTICE NO. 655

pursuant to Section 73 of the Electric Power Act (No.11 of 1997 of the Laws of Kenya). The electric power was connected to the Respondent premises on 30th May, 1997 and 24th September, 2001. The Respondent/ Complainant averred that in or about April, 2005 the Respondent started experiencing frequent power supply interruptions and fluctuations together with low voltage problems. The Respondent/Complainant further alleged that these power interruptions and fluctuations caused damage to the Respondent’s electrical equipment which included lifts, CCTV cameras, computers and light bulbs. The Respondent wrote letters of complaint to the Appellant complaining about these power interruptions, fluctuations and low voltage. The Appellant acknowledged the Respondents/ Complainants letters and stated that the power failures that had affected the main supply line to the Respondents’ premises had been satisfactorily addressed and sorted out. However the Respondent continued to complain about the power supply problems. Ultimately the Respondent filed a formal complaint with the Commission on 3rd May, 2007 seeking the following remedies. THE KENYA GAZETTE 20th January, 2012 138 138 (a) That the Respondent (in this case the Appellant) do forthwith take remedial and/or corrective action to ensure that the complaint is permanently resolved and that the complainant received regular and uninterrupted power supply and that the aforesaid power supply interruptions and fluctuations do not recur. (b) That the Respondent forthwith pay damages to the Complainant in the sum of Kshs.1,888,948.10. (c) That the Respondent pay the Complainant the legal and incidental costs incurred in lodging the complaint. After hearing both parties the Commission delivered its decision on 1st April, 2011 as follows: (a) That the Respondent shall pay within 30 days of the gazettement of this decision; (i) The sum of Kshs.570,100.55 to the Complainant. (ii) Complainant’s Advocates costs based on (1) above as may be agreed on between the parties or to be determined by the Commission upon presentation of a bill of costs. (iii) The Commission’s costs; (b) That the balance of the Complainant’s claim in the sum of Kshs.1,318,847.55 (Kshs1,115,373.00) being the cost of diesel utilized by standby generator and replacement of two old batteries) is hereby disallowed. Being dissatisfied with the said decision of the Commission, the Appellant has appealed to this Tribunal seeking orders to: (a) Set aside the Decision of the Energy Regulatory Commission deciding that the Respondent should pay the Claimant Kshs.570,100.55(Kenya Shillings Five Hundred and Seventy Thousand, One Hundred and Fifty five cents) in damages and dismiss the same. (b) Set aside the Decision of the Energy Regulatory Commission to the effect that the Respondent should pay costs of the Claimant and the costs of the Energy Regulatory Commission and substitute the Decision with that of the costs of the Respondent and the costs of the Commission to be paid by the Claimant. (c) The Respondent to meet the Appellant’s and the Tribunal’s cost of this appeal. The Appellant has listed five grounds of appeal as follows: 1. The Honourable Commission erred in Law and in fact in awarding the Claimant damages of KSh. 570,100.55 (Kenya shillings five hundred and seventy thousand, one hundred and fifty five cents) when the Commission has no jurisdiction to award damages. 2. The Honourable Commission erred in Law and in fact in finding that the Claimant is entitled to damages of Kshs.570,100.55 (Kenya Shillings Five Hundred and Seventy Thousand, One Hundred and Fifty five cents) when in fact there was insufficient evidence adduced by the Claimant to support such a finding. 3. The Honourable Commission erred in Law and in fact in deciding that a point of Law can only be raised within pleadings or through a Notice even when such point of Law goes into jurisdiction and in so holding, the Commission arrived at a wrong decision. 4. The Honourable Commission erred in Law and in fact in deciding that decision in Dispute No.2 of 2009 (Gazettee Notice No. 2618 of 13th March, 2009) Joseph Kinyanjui Mwai t/a Sandworth Printing and Packaging -vs- Kenya Power and Lighting company Limited was not relevant to the Dispute No.1 of 2009 and in so deciding, came to a wrong decision. 5. The Honourable Commission erred in Law and in fact in deciding that the Claimant had proved on a balance of probabilities that it was entitled to be paid damages of Kshs.570,100.55(Kenya Shillings Five Hundred and Seventy Thousand, One Hundred and Fifty five cents)and in so deciding came a wrong decision. When the issue came up for hearing on 29th July, 2011 Counsel for the Respondent, Mr Kisilu applied for adjournment on the basis that Ms Mate who had conduct of the brief for the Respondent was engaged in a matter before the High Court in Kisumu. Mr. Esuchi, Counsel for the Appellant did not object to the application for adjournment. The Tribunal allowed the application for adjournment and ordered that hearing would proceed by way of written submissions. The Appellant should file and serve its written submissions on or before 10th August, 2011, while the Respondent was to file and serve its written submissions by 19th August, 2011. The appeal would then be heard on 26th August, 2011 when Counsel would orally highlight their written submissions. Hearing of the appeal commenced at 10.30 a.m., on 26th August, 2011. Mr Okeyo appeared for the Appellant but there was no appearance on behalf of the Respondent. Mr Okeyo stated that the hearing dates of 26th August, 2011 had been given in presence of both parties. He wished to proceed with the hearing notwithstanding the absence of Counsel for the Respondent who was quite aware of the hearing date. The Tribunal ordered for the hearing to proceed. Counsel for the Appellant drew the Tribunal’s attention to the Memorandum of Appeal and the written submissions filed with the Tribunal on behalf of the Appellant. He said that he would rely on the filed pleadings, the written submissions and the legal authorities already filed with the Tribunal. In the written submissions filed on 9th August, 2011, Counsel for the for the Appellant stated that the Appellant would condense its submissions into two grounds namely; (a) The Award of Damages of KSh. 570,100.55 to the Claimant by the Energy Regulatory Commission was a decision in error as the Commission by it’s own admission has no Jurisdiction to ward damages. (b) The findings of the Energy Regulatory Commission that the Appellant should pay the Respondent Kshs.570,100.55 in proven damages was a fault finding as the Respondent never proved even on a balance of probabilities that it lost the sum, of Kshs.570,100.55 as a result of the unproven power interruptions. During his oral submissions Counsel for the Appellant reiterated that the Commission had no jurisdiction to grant an award for damages. In support of this proposition, he cited the Commission’s decision in Dispute No. 2 of 2009; Joseph Kinyanjui Mwai c/o Sandworth Printing and Packaging Ltd. vs The Kenya Power and Lighting Co. Ltd. He further stated that the Commission had erred in holding that it was not bound by that decision. The Commission had further erred in holding that the Appellant would not rely on the Decision in Dispute No.2 of 2009 because it had not raised the issue of jurisdiction in its pleadings before the Commission but sought to raise the issue only in its final submissions. Counsel argued that the issue of jurisdiction was so fundamental that any Tribunal or Court had to satisfy itself that it had jurisdiction to hear a matter before it whether or not the parties had raised the matter. He sought to rely on the Court of Appeal decision in Owners and Masters of Motor Vessel “Joey” vs Owners and Masters of the Motor Tugs “Barbara” and “Steve B”.(2008) 1 EAC (CAK) 367. Counsel urged the Tribunal to allow the appeal with costs to the Appellant. In the course of his submissions Counsel of the Appellant conceded the Appellant had not appealed on the issue of the Appellant’s liability on negligence. He stated that he had advised his client not to appeal against liability. The Tribunal ruled that the judgement would be delivered on notice to the parties. By a notice of motion dated 30th August, 2011, the Respondent applied for the Tribunal to set aside the ex-parte proceedings conducted on 26th August, 2011. The notice of motion was supported by the annexed affidavit of Karen Mate Advocate for the Respondent. In that affidavit Counsel for the Respondent stated that she had been led to believe that the matter had been set down for hearing at 2.30 p.m. on 26th August, 2011. She duly went to the Tribunal at 2.30 on 267th August, 2011. She duly went to the Tribunal at 2.30 p.m. on 26th August, 2011 only to be informed by the Secretary to the Tribunal that the matter had already been heard in the morning and judgment was reserved to be delivered on notice. 20th January, 2012 THE KENYA GAZETTE The said notice of motion was set down for hearing on 9th September 2011 at 10.00 a.m. During the hearing on 9th September, 2011, Millie Ondari appeared for the Respondent and argued the Notice of Motion. She applied to set aside the proceeding of 26th August, 2011 on the grounds that there was an inadvertent miscommunication as to the to the time of hearing of the appeal on 26th August, 2011. Consequently the failure by Counsel for Respondent to attend the Tribunal in the morning of 26th August, 2011 was inadvertent. She pointed out that Rule 11(1) of the Third Schedule to the Energy Act gave power to the Tribunal to vary any of its order. It would be against the principles of natural justice to condemn the Respondent without giving it an opportunity to be heard. No prejudice would be occasioned to the Appellant if the orders sought in the notice of Motion were granted as the Appellant would still have an opportunity to prosecute its appeal. Counsel relied on Articles 50 and 159(2) of the Constitution granting right to fair trial. Mr Esuchi, Counsel for the Respondent, opposed the Notice of Motion. He relied on the Affidavit of his colleague Mr Frederick Okeyo sworn on 7th September, 2011 and filed with the Tribunal. The hearing date of 26th August, 2011 had been given in presence of all the parties. Counsel for the Appellant had appeared in Court in time. The Appellant should not be condemned for attending on time on 26th August, 2011. In any case the Respondent had already filed its written submissions and should not claim that it was being condemned unheard. The members of Tribunal retired to Chambers, to consider the matter . They returned to the Courtroom and made a ruling as follows: “The Tribunal has considered the affidavit, evidence and Counsels” submission in support or in opposition to the application. The Tribunal notes that in its record of the proceedings of 29th July, 2011 there is no indication that the appeal was to proceed for hearing at 2.30 p.m. on 26th August, 2011. It appears both Counsels believed that the matter was to proceed at 2.30 p.m. as is deposed in paragraph 6 of the affidavit of Amos Kisilu. This disposition by Mr Kisilu has not been controverted by Mr Esuchi by way of an affidavit. The Tribunal considers that there is no need to set aside the entire proceedings conducted on 26th August, 2011. However, in the interest of fairness and justice, the Tribunal will allow the Respondent/ Applicant to highlight it’s submissions. Costs of the application will abide the outcome of the Appeal”. Hearing resumed at 2.30 p.m. on 9th September, 2011. Ms Ondari Counsel for the Appellant stated that she would rely on the Respondents written submissions dated 19th August, 2011 and filed with the Tribunal. She highlighted the following three grounds: 1. Jurisdiction to award Damages (Ground 3 of Memorandum of Appeal). Whether or not Tribunal had jurisdiction to award damage did not arise in the pleadings. It also did not arise during the hearing of witnesses. It arose for the first time in the Respondent’s supplementary submissions on 4th March, 2011. Therefore the Complainant before the Commission did not have the opportunity to respond on the issue of jurisdiction. The Commission found that that issue was raised too late in the proceedings for the Complainant to respond. In any event, rule 6 (b) of the Electric Power (Complaints and Dispute Resolution) Rules, conferred upon the Commission the power to determine issues relating to damages. The applicant submits that the Commission had jurisdiction to award damages. The Electric Power Rules are still in force by virtue of section 123(2)(e) of the Energy Act. 2. Whether Respondent proved its claim on a Balance of Probabilities. In the Appellant’s submission (at pages 4 or 5) it is argued that the Complainant’s witness before the Tribunal, one Mr. Mutisya, was not a qualified electrician. The issue of his qualification was not raised during cross examination but in the final submissions before the Commission. The issue has been raised for the first time in this appeal. Consequently, the Tribunal, sitting as an appellant body, can not be asked to go and examine Mr. Mutisya’s qualification because that issue was not raised before the Commission. In addition to that, there was another witness who corroborated the evidence of Mr. Mutisya. Even the Respondent’s witness, Mr. Ochola, confirmed that the Appellant had received complaints from Complainant on power fluctuations. Mr. Ochola further testified that he commissioned one Mr. Kariuki to investigate the complaint. The result of Mr. Kariuki’s investigation was not brought before the Commission. The Commission did not receive any evidence to rebut the Complainant’s evidence that the chiller was damaged by electric power fluctuations/interruptions. There is an invoice at page 40 and an ETR receipt at page 38. The invoice and receipt read together is evidence of payment of repair or Chiller II. 3. Whether the decision in ERC Dispute No 2/2009 is binding on the Commission. The Appellant’s contention is that in Mwai’s case the Commission held that it had no power to award damages. The decision was not biding on the Commission because of the principle of horizontal or concurrent stare decis. Counsel referred to the authority of Galot and others Vs Kenya National Capital Corporartion – HCCC No. 2054 of 1993 (unreported). The Commission is not bound by the principle of stare decis if the circumstances are different. On those grounds Counsel prayed that the appeal be dismissed. Mr. Esuchi Counsel for the Appellant responded to the oral submission by Counsel for the Respondent. He adopted submissions made by Mr Okeyo on 26th August, 2011. In addition he contended that the issue of jurisdiction can be raised anytime before the determination of a matter. It need not be raised in the pleadings because it is a point of law. The dispute before the Commission was filed in 2007 after the Energy Act 2006,had come into operation. The Electric Power Rules have no application after the coming into force of the Energy Act. Even if the Electric Power Rules were in force, they do not confer jurisdiction to award damages. Finally he submitted that the Commission is bound by its previous decisions. Even if the Commission makes a decision which is wrong it is bound by it. He prayed that the appeal be allowed with costs. Having heard the submission of all the parties we would like to make the following observations. Section 4 – Energy Act establishes the Energy Regulatory Commission. Section 5 – Sets out the objects and functions of the Commission which inter-alia include— (b) protection of the interests of the consumer, investor and other stakeholder interests. Section 6- Sets out the powers of the Commission which include:- (c) review, enforce and review regulations, codes and standards for the energy sector; (l) investigate complaints or disputes between parties with grievances over any matter required to be regulated under this Act; (o) impose sanctions and penalties on persons who are in breach of any of the provisions of this Act or any regulations made there under. The Concise Oxford Dictionary 7th Edition, among many other definitions, defines “sanction” as “Penalty for disobedience or reward for disobedience attached to a law. Clause containing this; consideration operating to enforce obedience to any rule of conduct. The dictionary also defines penalty as. “punishment, especially payment of the money, for breach of law, rule or contract”. Osborn’s Concise Law Dictionary11th Edition defines sanction as, - “penalty or punishment provided as a means of enforcing obedience to law.” It also defines penalty as: (1) Punishment, particularly a fine or money payment. (2) A sum payable (a) by an obligor on breach of a condition in a bond (b) on breach of a term of a contract. Words and Phrases Legally Defined (Vol.4 at page 98) states that, THE KENYA GAZETTE 20th January, 2012 140 140 “The essence of a penalty is a payment of money stipulated as in Terrorem of the offending party”. Halsbury Laws of England (5th Edition Paragraph 1102), defines damages as “the pecuniary recompense given by the process of law to a person for the actionable wrong that another has d one him”. In this case, the Commission has made a determination that the Appellant was negligent in providing uninterrupted services to the Appellant. The Appellant has not appealed against the Commission’s finding on negligence. Its complaint is that the Commission was wrong in awarding damages to the Respondent when such damages had not been proved and in any case the Commission had no jurisdiction to award damages. In her submissions Counsel for the Respondent argued that rule 6(b) of The Electric Power (Complaints and Disputes Resolution) rules 2006 confer on the Commission power to adjudicate on claims relating to damages. Counsel for the Appellant disagrees with this and states that these rules do not apply because the dispute was filed in 2007 after the Electric Power Act 1997 had been repealed. The applicable law is the Energy Act 2006 which does not give power to the Commission to award damages. He further argues that even if the dispute resolution rules apply they do not give power to the Commission to award damages. We have considered these submissions and we are of the opinion that the Electric Power (Complaints and Disputes Resolution) Rules apply notwithstanding that this complaint was filed after the repeal of the Electric Power Act 1997. These rules have been saved by Section 123 (2) (e) of the Energy Act. As pointed out above, the Commission has power under Section 6 (o) of the Act to impose sanctions and penalties for breach of any of the provisions of the Act. Section 63(1) (o) of the Act provides that the Minister may on the recommendation of the Commission make such regulations as may be necessary prescribing standards with regard to the quality safety reliability of supply of electrical energy and related installations. No regulations to this effect have been brought to our attention. Section 31 (2) (b) of the Act provides that all the licenses issued by the Commission shall include a stipulation that the licensee or permit holder is subject to liability under tort and the contract laws. The license issued to the Appellant has not been produced to the Tribunal to indicate whether or not it contains a stipulation that the licensee is liable under tort or contract law. This is however a statutory liability imposed by the Act and is binding on the licensee irrespective of whether the condition is contained in the license or not. In any case even if there was no such statutory liability, the licensee would be liable for the tort of negligence under common law. The Appellant has been found liable on negligence and it has not appealed against liability. Negligence is a civil wrong and is certainly a breach of the Act. A question then arises, what does the Commission do if it find that a licensee has breached its obligations to provide quality services? Is the Commission a toothless dog that cannot bite? How does the Commission fulfill its statutory mandate as a regulator if it cannot mete out sanctions against licensees who provide low quality services and cause injury or damage to consumers? As we have stated above Consumer protection is one of the objects the Commission has been established to safeguard. Section 6 confers on the Commission various powers to enable it to carry out its regulatory functions. These powers include quasi-judicial powers to enable the Commission to adjudicate on disputes. Part VI of the Act establishes the Energy Tribunal to exercise Appellate jurisdiction on the decisions of the Commission. There is a right of appeal to the High Court. These statutory provisions make it quite clear that in enacting the Energy Act Parliament intended to establish a quasi judicial mechanism of settlement of disputes within the Energy Sector. Any interpretation of the statutory powers of the Commission and the Tribunal should be purposive in order to give effect to Parliament’s intention to provide a mechanism for the adjudication of disputes in the Energy Sector. Francis Benion in paragraph 139 of his book states that there is a presumption in statutory interpretation that an enactment must be given a purposive construction in order to give effect to the legislative intent of Parliament. (Francis Benion: Statutory Interpretation (1984 edition) at page330. He goes on to state in paragraph 313 that; “Nevertheless a purposive constructions must obviously be in all cases a construction that gives effect to the legislative intention, whether or not the statutory language needs to be strained to achieve this. Most often a purposive construction, in the true sense, will be a literal construction.” In enacting the provisions of Section 6 of the Energy Act, Parliament must have intended to create a regulatory Commission with sufficient quasi-judicial powers to adjudicate disputes within the Energy Sector. Giving a narrow and restricted interpretation of the provisions of the Act would be to defeat the legislative intent of Parliament. Parliament does not legislate in vain. Adopting a purposive interpretation of the provisions of the statute does give effect to parliament’s legislative intention. Could an award of damages amount to an imposition of a sanction or penalty for wrongful behavior? The answer is yes. The Commission has the power to impose a sanction by requiring the Appellant to pay the sum of Kshs.570,100.55 to the Respondent as a recompense for an actionable wrong done to the Respondent by the Appellant. Further, by requiring the sum of KSh. 570,100.55 to be paid to the Respondent by way of restitution, the Commission is fulfilling its objective of protecting the interests of the Consumer as required by Section 5(b) of the Act. As we have pointed above literal dictionary meanings of the terms ‘sanction” and “penalty” include damages. It was really not necessary for Parliament to specifically use the term “damages” to confer on the Commission the jurisdiction to award damages. It was sufficient to use the term “sanction” and “penalties”. The words are broad enough to encompass restitution and punishment. In other jurisdictions it is common practice for regulators or utilities to impose fines and other forms restitution on utility providers for rendering low quality services to the consumers. In its Annual Report (http://docs.puc.ca.gov.published/report) for the Year 2000- 2001 under the heading “Consumer Protection and Enforcement”, the California Public Utilities Commission reports that “it investigates utility and transportation entities practices for compliance with applicable tariffs, rules and statutes”. The report further states that, the “Investigations may result in formal actions by the Commission, which issues orders instituting investigation (011) and where, warranted, takes enforcement action such as suspension or revocation of operating authorities and ordering fines and restitution.” The report further goes on to state that “On April 19, 2001, the Commission found that Coral Communications crammed consumers on a grand scale and fined the Company $5.1 Million. The Commission also ordered Coral Communications and its billing, aggregators to pay $4.6 million in restitution to Californian Consumers”. The examples from the California Public Utilities Commission indicate that an order for restitution of loss suffered by a consumer is within the regulatory competence of utility regulators. This reinforces our opinion that the Energy Regulatory Commission can legitimately award damages by way of restitution for loss suffered by a consumer arising out of the negligence of an utility provider. The Commission’s decision in the Mwai case was upheld by this Tribunal in Appeal No.l of 2009 Joseph Mwai t/a Sandworth Printing and Packaging Ltd. vs Kenya Power & Lighting Co. Ltd. It is however our view that the circumstances in the Mwai case are different from this Appeal. The Appellant in the Mwai case was unable to prove any negligence on the part of the Respondent therein. He was also not able to prove that he had suffered any loss arising from the actions of the Respondent. The Tribunal consequently held that it had no jurisdiction to award damages in circumstances where the Appellant in the Mwai case had not proved any negligence on the part of the Respondent and further he had not proved that he suffered any loss arising out of acts or omissions of the Respondent therein. In this appeal the Respondent/Complainant has proved negligence on the part of the utility provider and has also proved damages. It is therefore within the competence of the regulator to give an order for restitution for the loss suffered by the Consumer. Section 6(1) and (0) confer jurisdiction to the Commission to award damages by way of restitution to the Consumer and as a sanction for wrongful behavior by 20th January, 2012 THE KENYA GAZETTE the utility provider. For these reasons we would dismiss this appeal with costs. The Tribunal therefore makes the following orders; 1. That the Appeal be and is hereby dismissed with costs. 2. That the costs be taxed by the Tribunal if not agreed between the parties. Dated at Nairobi this 18th day of November, 2011. MBAGE NJUGUNA NG’ANG’A, Chairperson. FLORENCE KAJUJU-GITONGA, Vice-Chairperson. DR. SHEM-ARUNGU-OLENDE, Member. ––––––––––––– IN THE ENERGY TRIBUNAL AT NAIROBI CIVIL APPEAL NUMBER 1 OF 2011 THE KENYA POWER & LIGHTING CO. LTD—(Appellant) VERSUS FAIRLANDS INVESTMENTS LIMITED—(Respondent) (Being an appeal from the decision of the Energy Regulatory Commission, made on 1st April 2011, in the Commission’s Dispute No.1 of 2009) JUDGMENT Before I express myself on the merits of this appeal, I would like to make a few preliminary comments. Firstly, I wish to acknowledge that I have had the advantage of reading in draft the judgment of the other distinguished members of the Tribunal and that I find it most regrettable that the Tribunal was not able to arrive at a unanimous decision on the outcome this appeal. Secondly, I would like to observe that the Energy Tribunal (Procedure) Rules, 2008 (hereinafter referred to as “the Procedure Rules”) require that an appeal should be commenced by a statement of appeal in the form prescribed there under. The appeal now before the Tribunal has been not originated in that manner. It has been commenced by a Memorandum of Appeal, a form that is not provided for in the Procedure Rules. However, other than in that respect the appellant has complied with all the other requirements of the Procedure Rules; he has filed the record of the proceedings as well as the supporting documents/exhibits that were produced before the Energy Regulatory Commission ( “the Commission”). Since, as far as the Tribunal can discern, no prejudice appears to have been suffered by the respondent as a result of the appellant’s breach of the Procedure Rules, the procedural lapse was overlooked and the appellant’s Memorandum of Appeal was treated as a statement of appeal. Nevertheless I would hasten to warn that a party risks having its appeal struck out when it chooses to ignore the prescribed rules of procedure. The appeal itself was provoked by the decision of the Commission made on 1st April, 2001. The brief facts of the proceedings before the Commission appear to be that, sometime in the year 2007, Fairlands Investments Limited (“the respondent”) filed a complaint before the Electricity Regulatory Board (the predecessor of the Commission against the Kenya Power and Lighting Company Limited (“the appellant”). In its complaint, the respondent (who was then the complainant) claimed for compensation for loss and damage suffered as a result of the negligence of and/or breach of contractual duty by the appellant. The Commission found that the appellant was liable for negligence and awarded the respondent the sum of KSh. 570,100.55. Being dissatisfied with that decision, the appellant has now appealed to this Tribunal. According to the Memorandum of Appeal, the appellant has appealed on five grounds. I do not think that it is necessary to reproduce the said grounds of appeal here because in its written submissions and orally through its advocate Mr. Okeyo, the appellant indicated that it wished to condense them and argue that appeal on two grounds. The two “condensed” grounds of appeal appear in the appellant’s written submissions as follows: (a) The award of damages of KSh. 570,100.55 to the Claimant by the Energy Regulatory Commission was a decision in error as the Commission by its own admission had no jurisdiction to award damages. (b) The finding of the Energy Regulatory Commission that the Appellant should pay the Respondent KSh. 570,100.55 in proven damages was a fault finding as the Respondent never proved even on a balance of probabilities that it lost the sum of KSh. 570,100.55 as a result of the unproven power interruptions”. It is worthy of note that the appeal was heard partly through written submissions and partly through oral submissions. The appellant filed its written submission on the 10th August 2011 while the respondent filed its on 19th August, 2011. On 26th August, 2011, when the matter was scheduled for hearing so that the parties could orally highlight their respective written submissions, only Mr. Okeyo, advocate for the appellant, appeared. There was no appearance on behalf of the respondent. The Tribunal heard Mr. Okeyo and reserved its judgment, to be delivered on notice to the parties. Before the Tribunal had given any notice of judgment, the respondent applied to set aside the proceedings of 26th August, 2011. The application was heard in the morning of the 9th September, 2011 when Ms. Odari, who introduced herself to the Tribunal as an advocate holding brief for Ms. Mate for the respondent, successfully moved the Tribunal to re-open the hearing of the appeal and to allow the respondent to also orally highlight its written submissions. After allowing the respondent’s application, the Tribunal directed Ms.Odari to forthwith address it on the respondent’s submissions. Ms Odari requested for and was granted a brief adjournment up to 2.30 p.m. in the afternoon of the same day when she made oral submissions on behalf of the respondent. The substance of Ms Odari’s submissions is fully set out later in this judgment. Thereafter, upon closure of Ms Odari’s submissions, the Tribunal allowed Mr Eshuchi, who appeared on behalf of Mr. Okeyo, to reply thereto on behalf of the appellant. From the parties’ respective submissions, both written and oral, it seems to me that there are three issues for determination in this appeal, namely: (1) Whether or not the Commission is vested with the jurisdiction to award damages: (2) Whether or not the respondent (formerly the Complainant before the Commission) proved, on a balance of probabilities, that the appellant was liable to the respondent; and (3) Whether or not the respondent proved that it was entitled to damages in the sum of Kshs.570,100.55. I would like to firstly deal with the last two issues which, in my opinion, are closely related. During oral submission on 26th August, 2011, Mr. Okeyo informed the Tribunal that the appellant had not appealed against the Commission’s finding that the appellant was liable to the respondent for negligence. Nevertheless, I am satisfied that the Tribunal is obliged to determine the issue of whether or not the respondent proved liability against the appellant. I say so for two reasons. In the first instance, it has to be established that liability was proved before any inquiry can be made as to proof of damages the respondent. Proof of liability sequentially comes before proof of damages. In the second place, in spite of saying that the appellant did not contest the liability, Mr Okeyo submitted at length that the respondent did not prove liability against the appellant. Also, in its written submissions, the respondent stoutly defended the Commission’s finding that the appellant was liable for negligence. It seems to me, therefore, that the parties desire that the Tribunal should review issue of liability. That is what I will now proceed to do. On the one hand, the appellant argues that the respondent’s witness, one Mr Mutisya (who the appellant also describes as “Mr. Mutua” in its written submission) was not a certified electrician and that he could not therefore offer expert evidence as to the cause of the damage to the respondent’s equipment. According to Mr. Okeyo, the Commission should have disregarded the testimony of Mr Mutisya. On the other hand, the respondent urges the Tribunal to accept the Commission’s findings on matters of fact and to be careful before interfering with such findings. The responsibility of a first appellate court is well settled. In the case of Ndiritu –v- Ropkoi & Another – CA No.345 of 2000 (unreported), the Court of Appeal delivered itself thus: “As a first appellate court we are not bound by the findings of fact made by the superior court and we are under a duty to re-evaluate such evidence and reach our own conclusion. We should however be slow THE KENYA GAZETTE 20th January, 2012 142 142 to differ with the trial judge and the caution is always appropriate as O’Connor P. stated in Peters –vs- Sunday Post Ltd. (1958) EA 424, at page 429. ‘It is always a strong thing for an appellate court to differ from the findings on a question of fact of a judge who tried the case and had the advantage of seeing and hearing the witness’. This court will however interfere where the finding is based on no evidence, or on a misrepresentation of the evidence or the judge is shown demonstrably to have acted on wrong principles in reaching the findings he did. I understand the above authority to be saying that a first appellate court can and, in an appropriate case, should interfere with the findings of fact of a subordinate court. This Tribunal stands in the position of an appellate court in relation to the decisions of the Commission. It is therefore the duty of the Tribunal, as the first appellate body, to re- evaluate the evidence tendered before the Commission and reach its own conclusions thereon. I have carefully examined the evidence placed before the Commission by the parties. The respondent’s witnesses (Mr Mutisya and Mr Ng’ang’a) testified that the respondent’s equipment was damaged by electric power fluctuations. This evidence was not challenged or controverted by the appellant. In fact, the appellant own witness (Tobias Ocholla) admitted that there were electric power fluctuations affecting the respondent’s premises at the material time. If the appellant attributed the damage to the respondent’s equipment to a cause other than electric power fluctuations, then the onus was on it to prove such other cause. The appellant did not do so, I am therefore satisfied that the respondent proved, on a balance of probabilities, that the appellant was liable to the damage to the respondent’s equipment. I find no basis for interfering with the finding by the Commission to that effect. Regarding proof of the damages awarded by the Commission, I note that the Commission rejected the respondent’s all other claims of loss except for the one relating to the cost of repairs to Chiller II, which costs were supported by an invoice and an ETR receipt. These documents show that the respondent spent Kshs.570,100.55 to repair the said equipment. I do not think that there is anything more that the respondent could have done to prove the expense. I hold that the respondent proved on a balance of probabilities that it was entitled to damaged in the sum of Kshs.570,100.55. If this judgment was to rest here, I would order that the appeal to be dismissed. However, there is still the issue of the Commission’s jurisdiction to award damages to be considered and decided on. On the one hand, the appellant argues that the Commission having previously held, in the case of Joseph Kinyanjui Mwai t/a Sandworth Printing and Packaging –vs- Kenya Power Lighting and Co. Ltd – Dispute No. 2 of 2009 (hereinafter referred to as ‘the Joseph Mwai’s case”), that it has no jurisdiction to award damages, it was bound, under the doctrine of stare decis, to hold the same in this case. According to the appellant, jurisdiction is a matter of law which remains constant. On the other hand, the respondent submits that rule 6(b) of the Electric Power (Complaints and Dispute Resolution) Rules 2006 (hereinafter referred to as “the Electric Power Rules”) confers jurisdiction on the Commission to award damages; that since the Commission has jurisdiction( presumably under rule 6 (b) of the Electric Power Rules) to handle complaints relating to damages, it also has jurisdiction to award damages because Parliament must have intended that the power to determine a dispute relating to damages also carried with it the duty award damages. The appellant relies on the case of Gordhandas – vs- Narotam (1957) EA 223 to support that proposition. In addition, the respondent contends that the issue of jurisdiction was raised by the appellant before the Commission as an afterthought; that it had not been pleaded or raised as a preliminary objection; and that it was only brought it up in the final submission. The respondent moreover argues that a court or tribunal is only bound to decide on issues raised in the parties’ pleadings and, consequently, the Commission was not bound to decide on the issue of jurisdiction. Finally, with regard to the binding force of the Joseph Mwai’s case, the appellant argues that the Commission was not bound to follow the same because ,under the doctrine of horizontal stare decis, a court is not bound by the decision of another court with concurrent or horizontal jurisdiction I have considered the above rival submissions. I have also read and considered the authorities cited by the parties on the issue at hand. In my considered view, it is not enough to contend, as the appellant does, that the Commission has no jurisdiction to award damages because the Commission was bound by its decision the Joseph Mwai’s case. That contention assumes that the Commission correctly interpreted the law in the Joseph Mwai’s case; for, surely, the doctrine of stare decis does not mean that a court or a tribunal has to blindly follow its previous decisions even where such decisions are plainly wrong. Further, my view is that a tribunal’s jurisdiction is not really founded on the tribunal’s assertion that it has jurisdiction; rather, it is based on the law upon which the tribunal relies to make the assertion. Be that as it may, was the Commission’s decision in the Joseph Mwai’s case a correct interpretation of the law? The Joseph Mwai’s case was the subject of appeal to this Tribunal, in Tribunal Appeal No. 1 of 2009 – Joseph Kinyanjui Mwai t/a Sandworth Printing & Packaging –vs- Kenya Power & Llighting Co. Ltd. (hereinafter referred to as “the Joseph Mwai’s appeal”). The issue of whether or not the Commission had the jurisdiction to award damages was one of the grounds of appeal. The Tribunal examined the law extensively and held that the Commission had no jurisdiction to award damages, I am satisfied that the Tribunal arrived at the correct interpretation of the law and I find no basis for departing from it. Nevertheless, I am still compelled by two considerations to re- examine the law relating to the Commission’s jurisdiction to award damages. I am compelled to do so because, firstly, I am bound to give due weight to the parties’ representations on the issue at hand and, secondly, I am in the minority in holding the view that the Tribunal’s decision in the Joseph Mwai’s appeal is correct and still good law and that the Commission has no jurisdiction to award damages. As a starting point, I wish to observe that the Commission is a statutory body created by the Energy Act 2006 (“the Act). The Act prescribes the objects, power and functions of the Commission. It is settled law in this country, as in other commonwealth jurisdictions, that a statutory body can only do such things or exercise such powers as it is empowered to do or to exercise by statute. Thus, when discussing the jurisdiction of the Rent Restriction Tribunal in the case of Re Hebtulla Properties Ltd (1979) KLR 96, at page 100, Simpson J. (as he then was) had this to say: “It must however be borne in mind that the tribunal is a creature of statute and has only such jurisdiction as has been specifically conferred upon it by the statute.”. And, Francis Bannin in his book entitled Statutory Interpretation (Third Edition), at page 183 puts it this way: “A power to do something extends only to that thing. Its purported exercise to a different thing is to that extent not an exercise of power at all: the power exercised must be the power conferred.” In the Joseph Mwai’s appeal, the Tribunal considered the provisions of ss.5,6,8,52, 61 and 63 of the Act; as well as rule 6 of the Electric Power Rules. These were the provisions of the law that were drawn to the Tribunal’s attention during the hearing of that appeal. I propose to give a fresh and closer look at those legal provisions. I can safely say that, broadly speaking, s.5 of Act sets out the objects and function of the Commission (see the marginal note thereof). In other words, s. 5 is concerned about the goals and activities of the Commission; what in corporate governance terms would be known as a mission statement. The section has nothing to do with powers or jurisdiction of the Commission. It is under s. 6 of the Act that the Commission is given the various powers that it requires to achieve its objects or perform its functions. Among these is the power to investigate complaints or disputes, which power is provided for under s.6(1) of the Act. Is this power (under s.6(1) enough to confer jurisdiction on the Commission to award damages?. I do not think so. What that provision does is nothing more than to empower the Commission to investigate complaints and disputes. There is also nothing in the Energy Act, as was the case of the legislation in the Gordhandas case, to imply that Parliament intended to confer on the Commission the jurisdiction to award damages. It has been argued that the power to imporse sanction and penalties, given to the Commission under s.6(o) of the Act, should be interpreted as conferring jurisdiction to award damages. I respectfully disagree. The first thing to consider is the meaning attached to the expressions “sanction” and “penalty”. The Act does not define them. In the absence of statutory definition, the rules of interpretation require that the words be given their ordinary meaning. In the Longman 20th January, 2012 THE KENYA GAZETTE Dictionary of Contemporary English the said words are defined as follows: ‘Sanction’: formal action or punishment (to be) ordered when a law or rule is broken; ‘Penalty’: 1. Punishment for breaking a law or rule: 2. Something (such as number of years in prison or amount of money to be paid) that is ordered as punishment. From the above definitions it can be seen that the idea of punishment is inherent in both a ‘sanction’ and a ‘penalty’. It is also clear from the definitions that punishment is directed at the person who breaks, and not the person who is the victim of the breach of, a law or a rule. Generally speaking, the idea of punishment is to cause some pain to the law breaker so that he complies with, or desists from breaking, the law. (In the course of my research, I discovered that the words ‘penalty’ and ‘punishment’ have a common origin in the Latin word ‘poena’ which means pain). When a “punishment” or a “penalty” is imposed on a wrongdoer, no benefit accrues to the victim of the wrongdoing. On the other hand, an award of damages is by way of recompense to the victim of the wrongdoing. An award of damages or compensation is for the direct benefit for the victim of wrongdoing. I do not see anything in the Act that would lead me to believe that an award of damages is one of the sanctions or penalties contemplated under s. 6(o) of theAct. Further, the said expressions “sanction” and “penalties” must be read in their proper context. That context is clearly identified. Section 6(o) clearly says that sanctions or penalties are to be imposed “ on persons who are in breach of any of the provisions of this Act or any regulations made thereunder” (the underlining is mine for the purpose of emphasis). It cannot be plainer than that: It seems to me that sanctions or penalties are directed at the person who has contravened or failed to comply with the provisions of the Act or the regulations made thereunder. It also seems to that the sanctions or penalties must relate to a breach of a portion of the Act or of the subsidiary legislation thereunder . Moreover, in my view, the Commission can only impose those sanctions or penalties that it is expressly empowered by the Act to impose. The award of damages for a contractual or other civil wrong is not one of the sanctions or penalties that the Commission is empowered by the Act to impose. That, with respect, is the responsibility of a court of law exercising its civil jurisdiction. I repeat the Tribunal’s words in Joseph Mwai’s appeal where it expressed itself in the following terms: “We agree with counsel for the Respondent that the jurisdiction to assess or award damages, payable by the Commission or a licensee for liability under the Act, remains with a court of law in exercise of its civil jurisdiction..” I have nothing more to say regarding ss. 8, 52, 61 and 63 of the Act beyond what the Tribunal said in the Joseph Mwai’s appeal. However, before I conclude this judgment, I wish to address some of the points raised by the respondent in support of the Commission’s decision that the Commission has(contrary to its previous holding – in the Joseph Mwai’s case – that it did not have) jurisdiction to award damages. According to the respondent, jurisdiction to award damages is conferred on the Commission’s by rule 6(b) of the Electric Power Rules. The said provision states as follows: “6. The Board is available to assist complainants in the resolution of complaints in the following matters – (a) billings (b) damages (c) …………” Like I said earlier, rule 6 of the Electric Power Rules is one of the provisions of the law that was considered by the Tribunal in the Joseph Mwai’s appeal. In addition to what was held by the Tribunal in that appeal case, my own view of rule 6 of the Electric Power Rules is that the same is not about the powers of the Commission or what the Commission can do. Rather, it is a list of what a complainant can complain to the Commission about. To paraphrase the rule, it is about the matters which the Commission can help a complainant to resolve. According to under rule 3 of the Electric Power Rules, a “ complaint” is defined as a complainant’s expression of dissatisfaction with a service rendered by, or a practice of, a licensee. Applying that definition, rule 6 (b) of the Electric Power Rules appears to me to be saying that a complainant can complain to the Commission about ‘damages’ in the sense of injuries occasioned to his person or property. Surely it is absurd to suggest that the said provision refers to ‘damages’ in the sense of an award of compensation, because that would mean that the complainant would be lodging a complaint with the Commission expressing his dissatisfaction with compensation awarded. Having held, as I have just done, that rule 6 of the Electric Power Rule is not about the powers granted to the Commission but about matters over which complaints can be made to the Commission, it follows that I have to respectfully disagree with the respondent’s contention that rule 6 (b) gives the Commission power to determine disputes relating to damages or that such power carries with it the duty award damages. I hold that view because, according to law, jurisdiction has to be expressly conferred by statute on a statutory body such as the Commission. Jurisdiction does not exist if it has to be established by implication. It must be plainly obvious that the statute has conferred jurisdiction on a statutory body. Such conferment of jurisdiction on a statutory body by legislation must, as it were,hit you in the face. In that respect, I can do no better that repeat the following passage from the judgment of the court in Chogley –vs- East Afirican Bakery (1953) Vol. 26 K. L.R. 31 at page 33, which was quoted by Sachdeva, J and Brar, Ag. J (as he then was) in the case of Rent Restriction Tribunal –vs- Mayfair Bakeries Ltd. – Nairobi HC Misc. CC No. 246 of 1981 (Unreported): “In the course of judgment of the court in Civil Appeal No.8/52 it was said: We agree with Mr. Khanna that in testing whether a statute has conferred jurisdiction on an inferior court or a Tribunal such as the Rent Restriction Board, the words must be strictly construed: it must in fact be an express conferment and not a matter of implications.” The respondent also argued before us that the appellant had not pleaded the issue that the Commission has no jurisdiction to award damages and that the issue was raised before the Commission as an afterthought. I note that it is indeed on this very ground that the Commission declined to rule on the issue, reasoning that the respondent had not been given an opportunity to counter the appellant’s contention. As the Commission rightly observed, jurisdidction is a point of law. In practice one is not required to plead matters of law. For both the court and the parties are presumed to know the law. It was therefore irregular for the Commission to have insisted that a matter of law, especially one touching of its own jurisdiction, should have been pleaded first before the Commission could give it consideration. Moreover, it is really the responsibility of a court or a tribunal, before which a matter has been brought, to satisfy itself that it has jurisdiction before proceeding to hear and determine it. In the case of Josphat Mbuthia Munene –vs- Muthoni Kariuki Munene – HC Misc Appl. No. 115 of 2006 (Nyeri) (Unreported) Makhandia J. expressed himself thus: “It has been said that before embarking on the hearing of any matter, every court and indeed any tribunal established pursuant to any legislation must be satisfied that it has jurisdiction i.e. the legal power or authority to hear and determine a matter. If the court or tribunal has that power, then and only then does it proceed to hear the dispute; but if the court or tribunal determines that it has no jurisdiction then as was said in the case of ‘The owners of the motor vessel ‘Lilians’ V Caltex Oil (Kenya) Ltd. (1989) KLR I …....the court must down tools…………” It seems to me, therefore, that the Commission misdirected itself and erred in law when it declined to consider or make a finding on the issue of its jurisdiction to award damages. On my part, after having a fresh look at the law, I am still not convinced that the Commission has jurisdiction to award damages and I so hold. I therefore hold that the decision made by the Commission of 1st April, 2011 is a nullity in its entirety. I am fortified in this holding by the following remarks by the Court of Appeal in the case of Muhia –vs- Muhis (1999) 1 E.A. 209, at page 212. “It is established law that a judgment of a court without jurisdiction is a nullity. See Halsbuy’s Laws of England (3rd edition) Volume 9 at 351: ‘where a court takes upon itself to exercise a jurisdiction which it does not possess, its decision amounts to nothing.” I would allow the appeal on the ground that the Commission’s decision was made without jurisdiction and is hence a nullity. I would also set aside the decision of the Commission and substitute it with an order dismissing the complaint before the commission with costs. I would further order that the appellant’s costs in this appeal be borne by the respondent. Dated at Nairobi this 18th day of November, 2011. NYAGA KAMUNDI, Member. THE KENYA GAZETTE 20th January, 2012 144 144