Theme of Summit: Banking and Mediation, Leading the Way.
Day 1(13th April, 2023), Morning Session
Number of people in attendance: Approximately 300 people attending online and 500 attending in person.
The 2023 Mediation summary took place in the Main Auditorium at Strathmore Law School, from 13th-14th April 2023. The first session of day one, from 9:00-10:30 a.m., served majorly to kick-start the summit after a brief introduction as to what mediation is, its benefits especially in the field of banking and commerce and its limitations. In the first session each person was encouraged to look to mediation to solve commercial disputes and also challenge themselves, as mediators to become better and make mediation a mainstream method of dispute resolution.
- Dr. Peter Kwenjera, Dean of Strathmore Law School (Moderator).
- Dr. Vincent Ogutu, Vice Chancellor Strathmore University.
- Mr. John Gachora, Chair of the Kenya Bankers Association.
- Mr. Eric Theuri, President of the Law Society of Kenya.
- Hon. Anne Amadi, Chief Registrar of the Judiciary.
- Hon. Justice Fred Ochieng, Chair of the Court Annexed Mediation Task Force.
- Hon. Justice Ann Claire Willliams, Ret. Federal Court of Appeals, USA.
- Dr. Patrick Njoroge (Governor of the Central Bank of Kenya)
- Hon. Justice Martha Koome (Chief Justice of the Judiciary of Kenya)
Objectives of the Summit: To understand what mediation is and what it can be used to achieve.
The session was facilitated by Hon. Muthoni Mwangi and Mr. Allan Mukuki who welcomed everyone to the summit and made their insightful opening remarks, kicking off the summit.
Opening Remarks by the SLS Dean, Dr. Peter Kwenjera
The SLS Dean, Dr. Kwenjera talked about Strathmore Law School. Importantly, he showed how SLS has created a conducive environment for mediation to thrive, having pioneered a mediation collaboration between the institution, the banks and other stakeholders. He then introduced the Vice Chancellor, Dr. Vincent Ogutu.
Vice Chancellor, Dr. Vincent Ogutu
“The reason we are here is conflict; conflict exists. Behind every learned person there is conflict”- Dr. ogutu.
The V.C noted that people not only fight among themselves but also amongst others. It is not easy to solve conflict, especially within ourselves. Thus, this is where the alternative dispute resolution methods come in. The beauty of mediation is that each party is empowered, and they each have a say in what the outcome will be. He stated that mediation is his best way of solving conflicts.
Solving conflict is often construed to be binary, i.e., one way or the other, each fighting to get their own way. However, the V.C. encouraged mediators to create a third way, and to be creative. The basis of conflict is mistrust, that either party does not want good for others, and mediators need to find solutions that will be in the interest of both parties. Once you listen to both parties and reconcile their differences, you show both parties that it is possible for each to get what they win. He then encouraged everyone to embrace mediation as the best way of resolving disputes, and in a way that restores a lost good relationship between parties to a conflict.
Mr. John Gachora (Chair of the Kenya Bankers Association)
Mr. Gachora noted that Traditional African societies believed that a conflict should be resolved as soon as possible, before it becomes larger and complex. He underscored the important role that mediation has done and continues to do in restoring the relationship between banks and their customers. To attract foreign investment, we must rethink how we resolve commercial disputes, the lengthy court processes do not serve to help in this purpose.
Mediation is cost effective, expeditious, maintains confidentiality and good relationships.
Banks intend to adopt mediation as a method of resolving commercial disputes and as such the summit will allow them to learn more about what mediation is and how it works.
He challenged the Judiciary to work on the remuneration scale for mediation and to continue the ongoing expansion of the court annexed mediation secretariats all over the country. On behalf of the banks, he committed to support mediation as a form of dispute resolution and push forward all the efforts in that regard.
Mr. Eric Theuri (President of the Law Society of Kenya)
“Conflict is inevitable but combat is optional”- Eric Theuri.
As a representative of the law society, he recognised that we are living in a global economy, hence it is important to come up with advancements in conflict resolution so as to resolve conflicts in an amicable way. He also agreed that mediation is recognised as a tool that allows the banks and the customers to resolve conflicts and maintain a good relationship. It creates a win-win solution as there is “middle-man” in the form of a mediator to ensure this.
He took the view that as a country, mediation path is one we should take. While showing LSK’s commitment to promote mediation, he confirmed that the LSK aims to develop regulations on how banking mediation should be conducted. The more we have a structured and clearly well laid out response and plan to conduct mediation then we will be able to build the economy. Lawyers are the engineers of the economy. As such it is our interest to find ways to expedite conflict resolution so as to work towards economic prosperity. He concluded by further confirming that the LSK is willing to work with willing partners to structure mediation.
Hon. Anne Amadi (Chief Registrar of the Judiciary)
While taking the audience though her history in mediation, she stated that her first interaction with ADR was when she was going to set up the FIDA office in Mombasa, as per the direction of the Chief Justice. In responding to the demands of Article 159, and in line with its vision and mission of facilitating access to justice, she stated that the Judiciary has taken to the adoption of mediation as an ADR.
Mediation has become a permanent fixture in the judiciary. Social transformation through access to justice is the judiciary’s goal and mediation plays an important role in that mission. She extended her gratitude to the partners and collaborators who have generously supported the judiciary’s initiatives. She hopes that as an outcome of the summit, we will all aim to move all the conflicts, specifically the commercial ones, to mediators.
Hon. Justice Fred Ochieng (Chair of the Court Annexed Mediation Task Force).
Justice Ochieng stated that mediation can now be done privately, rather than going to court only to be referred back. The Kenya Bankers’ Association had already done this prior to its formal introduction. The main issue has been on non-committed borrowers’ information, which is shared with other banks. When they were not defaulting anymore, they were still barred from taking loans. As a result, banks were being sued, and that interferes with the bank-customer relationship.
That acted so much to the detriment of the customer, the interest keeps going up, the lawyer demands legal fees and the customer has to use the little money that he would have used to clear the loan is all used up. The same also works against the interests of the bank, in terms of customer-loss and the financial implications it presents with it. As mediation continues to take root in the country, the need for a “sober” outlook of solving interest increases. As a success story, he stated that the judiciary began private mediation in 2015. So far, there are 43 registries in the country and they cut across more than 100 court stations.
Hon. Justice Ann Claire Willliams (Ret. Federal Court of Appeals, USA)
“Now is the time to take mediation to the next level in Kenya”- Hon. Justice Ann Claire Willliams.
While making reference to the United States, she stated that the U.S cannot imagine justice without mediation. She stated that since she retired as a judge, her goal has been to structure conflict resolution according to each country, each culture. She stated that banking is crucial in the economy, and mediation in banking will help expedite cases that would otherwise be dragged through litigation. It saves time, money and anguish and takes away the anonymous burden. She lauded the move to embrace mediation in the banking sector, since that is the best tool for meeting the ends of justice.
Dr. Patrick Njoroge (Governor of the Central Bank of Kenya)
He stated that the shift to mediation is not easy, since lawyers in every case must be won while for bankers, every pending case means a lost dollar. Mediation has been perceived as an informal means of dispute resolution and has not been widely accepted or recognised.
Ultimately, mediation gives a new perspective in conflict resolution since the outcome is agreed to by both parties. It is encouraged for mediation to be a starting point for conflict resolution before moving towards litigation.
He attributed failure to do this to a lack of awareness and understanding of the differences between formal litigation and mediation by customers. Delaying completion of commercial cases inhibits business operations and in turn slows economic growth. He also acknowledged the fact that mediation is cost-effective, and assists parties to arrive at their own solution thus building trust, is informal so that both parties can properly explain their sides without worry or barriers.
Mediation ensures parties avoid the adversarial litigation system put in place.
The Governor also mentioned some of the limitations of mediation, which include resistance to apply mediation by customers, the need to first institute litigation processes (e.g injunctions which are court enforced), and policy and regulatory frameworks which are yet to be properly formulated.
Hon. Justice Martha Koome (Chief Justice of the Judiciary of Kenya)
The keynote speech by the Chief Justice demonstrated the judiciary’s willingness to support ADR, and specifically mediation. She stated that the Judiciary is keen on mainstreaming mediation as a method of dispute resolution. The Chief Justice confirmed her devotion to push the judiciary and lead the way in adopting mediation s a dispute resolution mechanism. Through her vision for the judiciary on Social Transformation Through Access to Justice showed her devotion to ensure justice is done to all, and in a cost-effective manner. This shows hers and the judiciary’s positive attitude in adopting mediation as one of the ADR forms of dispute resolution.
The Chief Justice referenced an assessment survey report of 2017, which showed that only 10% of Kenyans can access formal justice. The issue is thus with the remaining 90% of the people who cannot afford justice. ADR thus offers a best platform for these people. She called for a constructive discussion on what can be done to change this and ensure each person can equally experience justice and fairness.
She showed that private settlement agreements have the potential to prevent further build up and to give warning signs of defaulters so that mediation can start immediately. She recommended that each bank have a mediation sector, for internal dispute resolution. She was confident that these programmes will support initiatives already rolled out to promote justice in the commercial sector.
As a country we must ensure that the citizens can access justice in the most expeditious way. If commercial disputes are not solved adequately or efficiently, then it can be detrimental to the welfare of the citizens and the economy in general. She finished by stating that the success of mediation in Kenya requires participation from all of us as a country.