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Operation Linda Nchi in Perspective: Gains vs Challenges

By Ooko Victor

On Sunday 16th October 2011, the Kenya Defense Forces followed through on the Government of Kenya’s move to invoke Article 51 of the United Nations Charter, marching over 3000 troops into Somalia in the military offensive dubbed Operation Linda Nchi. Article 51, of the UN Charter recognizes members states right to self defense as a justification for invasion of another state. The move had followed a spate of attacks and kidnappings of citizens, aid workers and tourists from within Kenyan boarders by the Al Shabaab. As a result, foreign nations, had moved to issue travel advisories and the more than $750 Million Kenyan tourism industry faced with uncertainty. The march on Juba was underway, and Kenya’s largely inexperienced military set to face its first real cross-border operation.

Kenyans hold vigil for KDF at Freedom Corner
Kenyans hold vigil for KDF at Freedom Corner

It is now more than 5 years since the Somalia incursion. Whereas there was initial indication of progress by the KDF and later the Amisom troops, the Al Shabaab have severally bounced back to launch counter-offensive operations with deadly precision both in Kenya and within Somalia. Among tragic ‘revenge attacks’ by the Al Shabaab against Kenyan civilians were the Mpeketoni Attacks in Lamu County, West Gate Mall Attacks in Nairobi,the Garissa University Attack and the various attacks targeting non-Muslim teachers and quarry workers in Mandera. There were also grenade attacks launched in bus stations and on mobile buses that have since died down. The latest strategy by the Al Shabaab is focused on the ground forces with attacks in El Adde and most recently Kulbiyow the most devastating yet. And with more and more coffins finding their way back to Kenyan homes, we cannot help but ask ourselves at what cost?

Has Kenya realized its objectives?

The first objective of Operation Linda Nchi was to safeguard the country against attacks by the Al Shabaab. In doing this, the Kenyan government hoped to provide assurances to the West and salvage the lucrative tourism industry which pumps in a great chunk of revenue into the economy. It would be fair to acknowledge the relative stability that is currently prevalent in the country. This however has not been without incident with recent attacks in Mandera targeting quarry workers and a group of young thespians, all of non-Muslim faith.In addition to that, recent attacks targeting Electoral officials and materials have created cause for alarm. Important to note however, is that all these attacks have happened in North Eastern region bordering the Somalia.Hardly any attacks have been reported in other parts of the country. The military and police can do much more to flush out these elements existing within our borders and restore normalcy to the North Eastern Region as is the case in the rest of the country.

AMISOM forces keep watch at the Jubaland Presidential Palace
AMISOM forces keep watch at the Jubaland Presidential Palace

The second objective which was to restore order under a legitimate Juba government and military has also seen its fare share of mixed fortunes. Whereas the KDF collaboration with Somalia forces saw them recapture large parts of the country from the Al Shabaab, including Kismayu, recent attacks against the KDF and Amisom forces attest to a resurgent movement adapting to an increasingly hostile and well equipped opponent. It also points to local clans non-cooperation or outright support of the Al Shabaab in initiating a counter-offensive.

The Al Shabaab has severally used guerrilla tactics, coming out only to launch severe attacks on isolated military camps, specializing on finding their opponents ill prepared and overwhelming them with massive numbers of insurgents. During the El Adde attack and more recently the Kulbiyow attack on the KDF, the Al Shabaab used identical offensive strategies. Both attacks began in the wee hours of the morning, probably to catch the KDF at their most exhausted moment when all hopes of a night long attack have dissipated. The first move is usually either to jam communication signal or to destroy the local communication network towers prior to the attacks so as to hamper communications that may facilitate a backup to the ground troops. This is followed with Vehicle Borne Improvised Explosive Devices and suicide bombers who wipe out large numbers of rival forces and further confuses any meaningful defense mounted by the forces, before a wave of attackers land in to eliminate survivors and any other remaining boots on the ground.

Logistical Challenges

The El Adde attack proved most fatal due to the slow response from the command base. With no Helicopters to repulse the insurgents from the air, and an already weakened force on the ground, the troops were left with little else to do rather than to fight to stay alive for as long as they could. The Somalia Government and Western media said that more than 80 Kenyan soldiers died that day, even as the Kenyan government remained tight lipped on the figures. Kenya is however not alone in having fallen to this Al Shabaab strategy; In June 2015, more than 70 soldiers from Burundi in Lego area, 100 kilometers South of Mogadishu, were killed just weeks after they had replaced their colleagues. In September 2015, at least 50 soldiers from Uganda were killed by the terrorist group in Janale District, 80 km southwest of Mogadishu in the Lower Shabelle region. A convoy of Ethiopian soldiers was also ambushed and dozens killed in 2015 during a troop rotation although the Ethiopians did not release final casualty figures.

KDF carrying casket of fallen comrade
KDF carrying casket of fallen comrade

Another cause for worry is that the response would only come from within Kenyan bases in Mandera, Elwak and Wajir and not from neighboring Amisom forces within Somalia. Speculation has been rife over a lack of intelligence cooperation between Ethiopian and Kenyan forces over ties with rival Somalia clans that have been tasked with creating a buffer zone between the Al Shabaab and the respective countries, possibly alluding to the non-response from the Ethiopian forces to back up the estranged Kenyan forces.

With the latest attack on Kenyan troops at Kulbiyow however, the Kenyan troops seemed to have had it together successfully defending and repulsing the militants from their camp. As if learning from the El Adde shortfalls, the back up from the air was timely and managed to stabilize the situation for the ground in time for the ground troops to effectively keep the insurgents at bay. And even though the government initially appeared keen to hide the figures of the casualties, official military reports indicate that Kenya lost 21 troops from the attack. The media has also been granted exclusive access to the survivors of the attack as well as coverage of the Kulbiyow camp, probably to preempt any propaganda points Al Shabaab may have intended to score.

Renewed calls for withdrawal

There is growing calls for the withdrawal of the KDF from Somalia with key reasons ranging from the need to secure our boarders from within; the high cost of the war in Somalia both financially as well as the loss of soldiers and the recent allegations of soldiers participating in illegal charcoal and sugar business with the Al Shabaab. Human Rights groups have also criticized the bombing of civilians as well as the torturing of locals for information on the Al Shabaab and its sympathizers. Whether this will happen anytime soon is subject to political developments between the government and the opposition in Kenya, each backing extreme ends of the discourse.

Conclusion

Whereas I support an exit strategy from Somalia, the move should not be rushed only for the Al Shabaab to regroup and resume attacks against Kenya. The following key pointers should also be considered to address previous shortfalls:

  1. Close collaboration between the Amisom troops is necessary so as to effectively flush out and vanquish the Al Shabaab.
  2. The Somalia Army still has Al Shabaab sympathizers providing information that enables effective attacks against Amisom forces. Joint efforts is therefore necessary to help establish a united army devoid of clan allegiances.

    A KDF soldier takes aim during an operation in Somalia.
    A KDF soldier takes aim during an operation in Somalia.
  3. The efficiency of the Amisom troops should also be boosted with the provision of adequate resources including air support during combat as well as additional manpower. Continued suspicion among troops from different countries will only serve to limit their efficiency in Somalia.
  4. Finally, it is important that gradual replacement of troops is effected to prevent scenarios where a completely new troop is ambushed soon after deployment to new, unfamiliar terrain as has been the case.

Amisom should realize that the Somalia operation is war and not another peace-keeping mission. As such, it is vital that full military strength is employed if and when necessary not only to deal a blow to the insurgents but also to protect the lives of the ground troops.

The writer is a Research Consultant with Savic Consultants in Nairobi.

Kenya’s Policy Dilemma in Perspective

By Sitati Wasilwa

An artist's impression of Nairobi under Vision 2030. Image: Courtesy
An artist’s impression of Nairobi under Vision 2030.
Image: Courtesy

If nearly all the socio-economic policies that have been formulated in Kenya since 1963 were to be fully implemented, there is no doubt that this country’s economy would feature among the newly industrialized economies not just in Africa but in the whole world.

The implementation of these policies would have translated to low levels of poverty in the country, enough food for all Kenyans, a vibrant manufacturing sector, a high number of formal job opportunities, a better healthcare system, a highly developed transport system, proper access to clean water among other positives that are associated with an economy that is undergoing structural transformation.

In evaluating and reviewing a good number of these policies, there is a consistent feature that clearly defines the policy process/cycle in the country; the aspect of policy dilemma. The policy process involves several stages with the most pronounced phases being policy formulation and policy implementation. The formulation of socio-economic and/or public policies involves the input of the various stakeholders and the implementation phase largely depends on the rate of efficiency of the government- ministries, agencies, state departments and institutions.

Policy dilemma, in this case, refers to how magnificent policies are formulated but implemented in a flawed and inconsistent manner. This has led to the recurrence of the socio-economic challenges/problems that bedevil the country creating a developmental scenario of making three steps ahead and five steps backwards. With reference to this, it is not a surprise that some of the challenges that faced the nation in the 70s, 80s and 90s have never been amicably solved.

Take for instance Kenya’s first comprehensive development blueprint, Sessional Paper No.10 of 1965: African Socialism and its Application to Planning in Kenya. This policy document highlighted the course of action that was to be followed to steer the country’s nascent economy with the public sector and the private sector playing an important role in its implementation. Three challenges were to be solved by this policy; poverty, disease and ignorance implying on a large-scale that all Kenyans were to have access to affordable healthcare and education as well as better living standards. Several gains were made but its implementation was thwarted along the way by both internal and external forces.

Women fetching water from a river in Kenya, Photo: Courtesy
Women fetching water from a river in Kenya,
Photo: Courtesy

The current water shortage problem experienced in the country would be non-existent if most of the water policies that have been formulated over time were effectively implemented. The most notable policy initiative to solve the problem of access to clean and available water can be traced to 1974. During this year, there was the formulation and subsequent launch of the National Water Master Plan Initiative whose slogan was: Water for All by the Year 2000. The implementation of this policy never came to fruition.

In 1986, another policy paper was drafted; Sessional Paper No.1 of 1986 on Economic Management for Renewed Growth. This policy paper incorporated the Structural Adjustment Programmes (SAPs) and it was formulated following the conditions issued by the Bretton Woods institutions (World Bank & IMF) on the supposed economic restructuring the government was to adopt in return for financial assistance from these institutions.

This policy document addressed the following: market liberalization, reduced role of the state in the economy, deregulation and privatization of some of the state-owned enterprises. Since this policy was recommended by the Bretton Woods institutions, the government implemented nearly every bit of it and the outcomes were not pleasing at all; it did more harm than good. This was because its recommendations were based on the model of the USA economy and not on the local conditions that were prevalent in Kenya’s economy.

A Sessional Paper on the Micro and Small-scale Enterprises (MSEs) was formulated in 1992. The objective of this policy document was to transform the MSEs by institutionalizing a high degree of formality in them as a larger percentage were operating informally in the agricultural sector. The agricultural sector at that time contributed approximately 30% of the country’s Gross Domestic Product (GDP) and most of the Kenyans depended directly and indirectly on the sector for their source of livelihood.

What could be the scenario in case the Sessional Paper on the MSEs was fully implemented? A strong foundation for the manufacturing sector would be created as a result of the establishment of the agro-based industries, food production would have certainly increased hence making the country to be food secure, a high number of formal employment opportunities would have been created among many others.

A policy framework for achieving industrialization by the year 2020 was developed in 1996 specifically known as Sessional Paper No.2 of 1996; Industrial Transformation to the Year 2020. The overarching objective of this policy paper was to develop a vibrant manufacturing sector in the country that would have enabled Kenya to be a newly industrializing economy.

The entrance to Kenya's Export Processing Zone at Athi River. Photo: Courtesy
The entrance to Kenya’s Export Processing Zone at Athi River.
Photo: Courtesy

The implementation of this policy framework was flawed largely due to the inherent institutional weaknesses and structural inconsistencies which some are in-built in the policy itself and others being explicit to the policy. Its total implementation, with the rectification of its weaknesses, would have steered the economy’s trajectory to be defined in terms of the structural transformation.

With the institutionalization of the NARC administration in 2003, great attention was paid in reviving the country’s economy. To actualize this, a policy paper was formulated; the Economic Recovery Strategy for Wealth and Employment Creation (ERS) for the period 2003 to 2007. This policy document envisaged an economic growth rate of 7% upon the completion of the five year period in which it was to be implemented. In 2007, the country’s economy grew by 7% a clear indication that this policy framework was effectively implemented.

As the period of time for the implementation of the ERS was elapsing, the Sessional Paper No.10 of 2012 on Kenya’s Vision 2030 was designed. The main objective of the Vision 2030 is to transform the country into a middle-income economy by largely investing in the manufacturing sector and key infrastructural projects. The implementation of the Vision 2030 was to occur in phases denoted as the Medium-Term Plans (MTPs). The first MTP covered the period from 2008 to 2012, the second MTP from 2013 to 2017 and so on.

In as much as some significant progress is taking place especially in the construction of infrastructural projects, certain fundamentals have been ignored, for instance, the government hasn’t been largely committed to heavily invest in the manufacturing sector. Achieving the objectives of Vision 2030 remains a mirage considering how its implementation process is being executed.

Inconsistent & Flawed Implementation

Both internal and external forces have contributed to the failure of the holistic implementation of the policy frameworks formulated since independence. The major cause of the failure to fully implement these policy documents is the lack of a committed political leadership. The country’s political leadership has always focused on enriching itself at the expense of steering the country’s economy. Politics plays a crucial role in the implementation of the policy frameworks. All the administrations that have existed in Kenya starting from Jomo Kenyatta’s era have been rocked with massive corruption. However, Kibaki’s administration was more serious when it came to the implementation of national development blueprints compared to the others.

The urge to implement the policy proposals advocated by the World Bank and International Monetary Fund without subjecting them to scrutiny has in one way led to the flawed implementation of such policies. Normally, the policies championed by the Bretton Woods institutions are ignorant of the prevailing circumstances in the developing economies and they are formulated in accordance with the model of the economy of the United States of America. These are two different and primarily distinct economic models. The challenge is the readiness to embrace the policy proposals of the Bretton Woods institutions and disregard the locally formulated ones.

An in-built weakness could also be responsible for the flawed implementation of the policy frameworks. It is highly possible that the formulation phase is executed with so many assumptions and errors. Definitely, the problem of insufficient data comes into play causing the data collection phase to majorly rely on guesswork creating a situation that is different from the reality on the ground. This ultimately leads to a disconnect between the formulation and implementation phases of the policy frameworks.

 

The implementation phase of the policy process is crucial and the failure to effectively execute it will not create the desired socio-economic transformation. Politics plays a significant role in this phase hence the need to have a visionary political leadership in place. Kenya’s lack of a visionary leadership coupled with the challenges of inadequate data and the pressure from the Bretton Woods institutions have collectively hindered the country from fully implementing the various policy frameworks, some of which I have highlighted in this article. With proper implementation of the policies there is no doubt that most of the recurring problems in the country will be fully solved.

 

The writer is an Economist & Research Consultant at Savic Consultants, Nairobi.

 

 

What is in Store for Kenya’s Economy in 2017?

By Sitati Wasilwa

Kenya's capital Nairobi. Photo: Courtesy
Kenya’s capital Nairobi.
Photo: Courtesy

At the beginning of this year, many analysts and journalists as expected delved into making predictions about the possibilities and eventuality of Kenya’s economy. The overriding theme in the forecasts has oscillated on how the country’s economy will react to the increasing political temperatures in this electioneering period. Historically, Kenya’s economy has always been negatively affected by the exogenous shocks occasioned by political events/activities in the years in which the general elections have been held.

In 2016, Kenya’s economy is believed to have grown by 5.9% as compared to 2015 in which the country’s Gross Domestic Product (GDP) expanded by 5.6%. The 5.9% GDP growth is impressive with respect to the growth rates registered by peer economies, the Sub-Saharan region and the global average. In 2016, Sub-Saharan Africa (SSA) registered a growth rate of 1.4% which is the lowest ever for the region in two decades. This slump in SSA’s growth rate is attributed to the decrease in the global commodity prices such as oil and other minerals which are key export commodities for most of the country’s in this region. Kenya’s economy, being not so dependent on such commodities, was able to register a GDP growth rate of 5.9%.

Earlier projections by The National Treasury and the Word Bank have pointed out that the country’s economy is expected to grow by at least 6% in 2017. A growth rate of 6% for 2017 is pegged on various factors; endogenous and exogenous.

An image showing a section of the SGR. Photo: Courtesy
An image showing a section of the SGR.
Photo: Courtesy

Fast forward, various economic phenomena are expected to shape the country’s economic trajectory in 2017. One of the activities that will definitely alter Kenya’s economic architecture is the Standard Gauge Railway (SGR) whose first phase, linking Mombasa and Nairobi, is expected to commence operations in June 2017. According to the Ministry of Transport and Infrastructure and The National Treasury, the SGR once fully operational will expand the country’s economy by 2.5%.

For the SGR to contribute significantly to the country’s economic growth and development then some tough decisions must be made by the government including imposing bans on the transportation of commodities via the road using the trucks. However, the possibility of such an action being taken by the government is low considering that most of the trucks are owned by politicians and individuals who are well connected politically. In any case, the SGR is not only confined for the transportation of cargo but passengers as well. But to generate significant amounts of revenue then the operations of the SGR must be near full capacity and this will have massive implication on the privately-owned long-distance trucks. If at all the government is not going to impose tough restrictions on the long-distance trucks, then the SGR will largely be used to transport passengers and its expected returns on investments may just turn out to be lower.

In June 2017, Kenya is expected to start exporting crude oil against the possibilities that such a move in view of the energy infrastructure that is in place may totally fail to generate significant revenue, create meaningful jobs and create viable linkages with the other sectors of the economy. The exploration of oil backed up by sound systems and structures is an economic activity that is bound to spur growth and development unless there are prevailing exogenous shocks such as low crude oil prices around the world.

Ngamia 1 oil well in Turkana County. Photo: Courtesy
Ngamia 1 oil well in Turkana County.
Photo: Courtesy

It is expected, for the start, that only 2,000 (318,000 litres) barrels of oil will be drilled daily from the oilfields awaiting transportation to Mombasa. This amount of oil is certainly insignificant as far as the doctrine of economies of scale is concerned. This is the first misstep that the government is making. From the oilfields, the oil will be transported by road to Eldoret from where it will be transported via the railway line to Mombasa.

The 2,000 barrels of oil will have to be transported by at least 20 trucks daily from Turkana to Eldoret which is not economical at all. The trucks and trains that will be used to transport this crude oil need to be fitted with heating systems to maintain the suitable temperature recommended for crude oil and it will take at least more than one day for the crude oil to be hauled on the trains from the trucks. We should also not forget to factor in the risks associated with transporting crude oil on the road.

With reference to the early oil pilot scheme, the crude oil will be transported by train from Eldoret to the Kenya Petroleum Refineries Limited in Changamwe for specialized heating. Experts estimate that it may take not less than two months before the capacity of one shipping tank is attained and this implies further costs. After the capacity for a shipping tank is attained, the crude oil will be transported for a further 13.5km to the Kilindini Harbor for shipment. The early oil pilot scheme is uneconomical and inefficient and patience should have been duly exercised by first waiting for the construction of the proposed 865 km pipeline which has the capacity of transporting 80,000 to 120,000 barrels of oil per day.

This pilot phase is a move meant to benefit the multi-national corporations that are drilling oil in Kenya. Kenya’s economy is not expected to highly benefit from this early oil pilot scheme and the country will lose billions of money and only a handful of employment opportunities will be created.

The performance of the stock exchange market (Share index value) is another economic phenomenon that keen attention must be paid to. From my vantage point of view, the performance of the Nairobi Securities Exchange could be headed to the dogs if its recent performance is anything to go by. In the first 17 days of this year the Kenyan stock exchange market lost Kshs.153.5 billion. This is a clear pointer that Kenya’s economy has relatively large amounts of hot speculative money. There is no doubt that this wave of the hot speculative money leaving the economy has been triggered by the uncertainty surrounding the general election. Unless the situation normalizes, the rushing out of this hot speculative money from the economy may increase and in turn worsen the situation at the bourse as the general election fast approaches.

As for the electoral cycle, 2017 is a critical juncture in which very serious evaluations of the second Medium-Term Plan (MTP) should be done. The MTPs are cyclical phases detailing the structural and systematic implementation of Kenya’s development blueprint, Vision 2030, in accordance with successive governments that are instituted after each general election.

Considering the state of economic affairs in the country with the goals of Vision 2030 and with respect to the second MTP then clearly the economy is off the mark. The challenges which the second MTP was supposed to address include: the low level of domestic savings which is currently 14% of the total national GDP estimates, high dependence of the country on rain-fed agriculture, high levels of unemployment and poverty, the narrow range of exports, socio-economic inequality among others.

Objectively, the government has done little as far as the targets of the second MTP are concerned. The nexus of this is rooted in the flawed implementation of the existing policies. The implementation process of the Vision 2030 (second MTP) and other supporting policies has been overtaken by cases of grand theft (Corruption) and the prioritization of politics over policy implementation.

Perhaps the most anticipated event that will ultimately shape the country’s economic trajectory going forward is the 2017/2018 Budget Policy Statement which is expected to be read in April this year just four months to the general election. The 2017/2018 Budget Policy Statement, which has already been drafted by The National Treasury, amounts to Kshs.2.288 trillion. The fiscal deficit for the 2017/2018 budget is projected at Kshs.582.4 billion (Excluding grants) with the government expected to plug this deficit by netting in Kshs.221.1 billion from external sources and by sourcing for Kshs.320.7 billion domestically.

CS Henry Rotich at a past budget presentation event. Photo: Courtesy
CS Henry Rotich at a past budget presentation event.
Photo: Courtesy

From the above, it is evident that the public/national debt will continue rising. According to reports by The National Treasury the public debt is approximately Kshs.3.7 trillion and with an impending budgetary deficit the figure is bound to increase to around Kshs.4 trillion by the end of the 2017/2018 financial year. This will dent the state of the economy especially if the general election occasions a slump in the economic growth rate. Borrowing by the government is not bad but the amount borrowed must be seriously invested in viable infrastructural projects and in the manufacturing sector which have a very high potential of sustaining long-term economic growth as well as structural transformation.

2017 will certainly be a defining moment for the banking industry following the capping of the interests rates. The essence of Economics disputes the enactment of the usury laws unless such capping is meant to promote funding for specific sectors/segments of the economy or if it is instituted only for the short-term. A number of banks have been forced to lay off some of their employees following the operationalization of the law. It will be interesting to see the profit margins recorded by the banks as they will be announcing their financial performance in a few weeks time. The reality on the ground is that most of the banks have instituted tighter conditions for advancing loans to prospective customers. A larger proportion of high risk borrowers have been highly affected and banks prefer to lend to the government.

On a general scale, however, the political activities leading to the general election in August this year is the primary factor that will influence negatively or positively the performance of the country’s economy. Major investments in the private sector will be based on speculation and there is no doubt that the country’s economic growth rate may reduce in 2017.

The writer is an Economist & Research Consultant at Savic Consultants, Nairobi.

 

 

 

Contractual Agreements: The Essential Elements Of A Valid Contract

photo/courtesy

By Stanley Muema

Writing up a legal contract or agreement between two or more parties can be a fraught with hidden dangers. The devil is often in the detail and that’s why extreme caution should be used when the parties come together in anticipation to forming a legally binding contract. 

 Introduction

The contract lies at the heart of everyday business and is the means by which the simplest to the most complex of business is done. Effectively, a contract can be described as quite simple as a promise or agreement enforced or recognised by law. A contract has been defined by Sir William Anson in the words, “A legally binding agreement between two or more parties, by which rights are acquired by one or more to acts or forbearances on the part of the other or others.”  

The basic elements which are necessary in order for there to be a legally enforceable contract are as follows:

  •  Intention to create legal relations

Sometimes it can be very difficult to establish that there was an intention to create legal relations, especially in the case of family matters. The court will consider many factors when deciding whether or not there was an intention to create legal relations. These factors include the closeness of the family relationship and the extent to which one of the parties relied on the ‘agreement’. When the contract is entered into during the course of business then there will be a strong presumption that it was the parties’ intention to be legally bound.

  •  Offer

An offer is essentially an expression of willingness to contract made with the intention that it shall become binding on the person making it as soon as it is accepted by the person to whom it is addressed. It will usually be a matter of construction as to whether or not the offer was made in the first place and whether or not it was intended to create a legally binding agreement. When considering such issues the court will distinguish between an offer and an invitation to treat that is not enforceable. An invitation to treat requires further confirmation by the invitor.

  • Acceptance

An acceptance is a final and unqualified expression of assent to the terms of an offer. It may sometimes be difficult especially in business to determine when the negotiations have ended and the offer has been accepted. The court will look at the entire negotiation to ascertain whether or not final acceptance had taken place. Acceptance can be deemed to have taken place through the conduct of the parties. The general rule is that acceptance must be communicated to the person who makes the offer, although there are exceptions to this rule, for example where the offer expressly waives the requirement. One of the main exceptions is where acceptance is made by post. In this situation acceptance happens upon the posting of the acceptance. In practice, most contracts in today’s business world will lay down very specific methods of acceptance.

  •  Consideration

A promise is not, as a general rule, binding as a contract unless it is made in a deed or supported by some consideration. Where a contract is under seal no consideration need be provided.

  • Capacity

The law presumes that everyone has the capacity to contract and the onus is on the person claiming that they were incapable to prove so. If they succeed this incapacity may defeat the contract and make it unenforceable. The courts will accept three categories of incapacity. The first of these is contracts entered into by a minor. Apart from contracts for necessaries and contracts of apprenticeships, education and service, the general rule is that the contract will not be binding on the minor. The second category of incapacity is insanity. In order not to be bound the person must show that owing to his mental condition he did not understand what he was doing, that the other party was aware of this incapacity and that the contract was not one for necessaries. The third category of incapacity is intoxication and there is a similar burden of proof on the person seeking to rely on it as in the case of insanity.

  • Free Consent    

 Free consent of all the parties is another key element. ‘Consent’ means that the parties must have agreed upon the same thing in the same sense. There is absence of ‘free consent’ if the agreement was induced by (i) coercion (ii) undue influence (iii) fraud (iv) misrepresentation or (v) mistake.

  • Possibility of performance

For a contract to be enforceable it must be capable of performance. If the act is impossible in itself, physically or legally, the agreement cannot be enforced at law.

  • Business Capacity

The question of capacity to contract in a commercial law context arises when registered companies enter into contracts. There are two issues that need consideration. Firstly, the company must have the power to enter into the particular contract. This will be evident from the Memorandum of Association and the Articles of Association of the company. Secondly, it is necessary to see if the person who is entering into the contract on behalf of the company has the power to do so. This will be contained in the Articles of Association.

  • Lawful Object

It is also necessary that the parties to an agreement must agree for a lawful object. The object for which the agreement is entered into must not be fraudulent or illegal or immoral or opposed to public policy or must not imply injury to a person or property of another.

  •  Formal Requirements

The general rule at common law is that contracts do not have to be in writing. Where formal requirements are necessary, these will have been established by statute and will refer to specific contracts. For example contracts concerning interests in land and guarantees must be in writing under the Statute of Frauds.

  •  Contractual Terms

In general, the terms of a contract are those set out and agreed by the parties to the contract. But, in certain circumstances the courts have been prepared to imply terms into a contract. In order to do so it must be reasonable and necessary and must not be inconsistent with the express wording of the contract. There are also terms that are implied by statute, most notably by the Sale of Goods Act and Supply of Services Act 1980 and other statutes.

In absence of one or more of the above elements, then the contract may be deemed void, voidable or unenforceable.

Stanley Muema is a legal expert with Savic Consultants-Nairobi.

stanleymuema731@gmail.com

Hangover Review: 2016 in Perspective

capture-00The New Year is here with us, and Savic Consultants would like to thank all who walked with us in 2016. The progress has been immense and the journey ahead even greater. The objectives of the firm remains to contribute to the value addition for individuals and organizations in as far as capacity building is concerned, and in so doing, to help them overcome the numerous socio-economic and political challenges abound, and especially in the political year that is 2017. In order to effectively oversee this objective, Savic Consultants understands the role of Research both in providing a basis for intellectual discourse and subsequent actions, as well as in providing empirical evidence as explanation as to why the present exists as it is, and therefore, what needs to be done to make things better.

Misbehaving Parliament

The homestretch towards the new calendar year was never meant to be smooth sailing. The political class ensured that it was as bumpy as it could get. The move by Parliament to quash the spirit of political bipartisanship that saw the enactment of the Election Laws Amendment Act sought to create even more unease on a matter that could well have been approached with the requisite sobriety and regard for the greater good of the Country. In fact, the reigning debate has less to do with the amendments and more to do with the spirit in which the changes were made. What Kenya is witness to here, is raw political ego, suspicion and mistrust that is typical of the rival Kenyan political factions.

Having a manual backup may as well be an above board intention. Trusting that the politicians will not attempt to manipulate polling results in this loophole provided is the actual bone of contention. It is true that electronic appliances may fail us in this time tagged political exercise, the question however is the corresponding goodwill from the rival political camps.

Sanity in Examinations

The notable changes in the Education sector since the appointment of Dr. Fred Matiang’i cannot go unsaid. Kenya has seen the prompt release of National Examination results for that have largely been touted as credible with much credit going to the process rather than the result. The setting of examinations, the administration, making and release of the Kenya Certificate of Primary Education and Kenya Certificate of Secondary Education being true testament of what a change in leadership could bring about in as far as the streamlining of the education sector is concerned. We have zero cases of cheating and for the first time in Kenya’s history, all students who sat the national examinations actually received their full results. The next course of action would be the insanity in the Universities and other institutions of higher learning.

It is gratifying to see that we have high profile civil servants whose only desire is to see through the mandates accorded to them rather that to fill their coffers with looted public funds. And neither is the Education CS interested in a political seat in the future, quite refreshing I must say! Dr. Matiang’i has got his act together, and as a result, provided the right trail for other Cabinet Secretaries to follow.

Striking Doctors

The situation with the Doctors in Kenya is getting out of hand. My close friend is burying her sister this coming Saturday, another victim of the industrial action that is threatening to get out of hand. The governors are not making the situation any better. Allegations of officials of the doctors union being roughed up and in some cases assaulted is archaic and disturbing. Something needs to give just like the situation with the nurses was averted. If the stalemate with the doctors is not the number 1 on the priority list, I don’t know what qualifies to be above that.

Food Security

The food situation in the country remains a great challenge for Kenya well into 2017. In a Previous article Contextualizing Kenya’s Food Security Situation my colleague Sitati Wasilwa and I provided an in depth look into the perennial food shortages and how these shortfalls can be addressed. We are of course aware that the same government that oversees the drafting of the very reports we rely on to write these articles knows best what needs to be done. Maybe all that is necessary is a change of guard at the helm of the Agriculture Ministry or the Water and Irrigation Ministry for corresponding action to be effected.

Economy

It is also doubtful that 2017 will see a higher economic growth rate compared to 2017 in light of the anticipated political developments. Important however, is the need to arrest the runaway debt levels which could very well become unsustainable if it goes unchecked. Proper utilization of these finances in projects that could genuinely contribute into the repayment of the national debt, rather than the need for projects that justify political survival would be pertinent.

Whereas Kenya keeps borrowing, corruption levels in government are at an all time high. 2016 has seen the unearthing of the National Youth Service scandal and the 5 billion Afya House scandal under probe. The public inquiries into these scandals have been marred by theatrics and little substance that gives hope towards the recovery of these funds and the prosecution of culprits.

Peaceful Elections

Parliament’s in-tray is full with the matter of the Election Laws Amendments, The Independent Electoral and Boundaries Commission and Ethics Anti-Corruption Commission commissioners appointment, to name a few. We look forward to a bipartisan approach in the disposing of these matters This being an election year, the National Cohesion and Integration Commission has the uphill task of watching the political temperatures expressed in divisive political statements. And just like in 2016, we hope that the response if needed will be swift and decisive.

It is important that we have peaceful elections later in the year. The chaos witnessed in 2007/08 must be a constant reminder of just how easy it is for us to fall back into a state of chaos and total anarchy. Free and fair elections would be a great statement of peace and unity and as such, it is as much the responsibility of all political actors to ensure that whatever the outcome, Kenya wins. This can only be realized with free, fair and transparent elections.

Conclusion

2017 remains a full calendar that will keep on rolling whether or not we make something good for ourselves out of it. And whereas there is the urge to continue the merry making, two strikes on the calendar already imply otherwise.

Get up, fold your sleeves and get to work!

The writer is a Research Consultant for Savic Consultants in Nairobi.

 

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