Unpacking the Kenyan Supreme Court’s Finance Act Judgment [Guest Post] – Constitutional Law and Philosophy

[This is a guest post by Joshua Malidzo Nyawa.]

Introduction

In part 1 of this post, I introduced the decision of the Supreme Court of Kenya and responded to Gautam’s post. Part 1 of this post was mainly centred on the aspect of public participation in the decision. However, part 1 laid down a theory that defines the post. In Part 1, this blog highlighted that the Supreme Court adopted a hand-off and an exceedingly deferential approach, treating parliament and the executive with kids’ gloves. Consequently, it allowed them to steal a match on the Constitution and evade constitutional obligations. Part 2 of the post provides further instances where the Court was exceedingly deferential. This part argues that the Supreme Court adopted an interpretation that modified essential provisions meant to protect and safeguard the backbone of our constitutional democracy to save one bill of parliament. In essence, the apex court folded its arms and watched as the executive and legislature made a mockery of the Constitution.

The Suspended declaration of invalidity, or “Let the Constitution Bleed”

Can you vindicate the Constitution by allowing for its bleeding? The Supreme Court answers that question in the affirmative. According to the Court, there are circumstances when the Constitution can be allowed to bleed, and this is a way of vindication. Contrary to the accepted logic that once a law is declared unconstitutional, it is wiped off the statute books, the Supreme Court says no, although wiped out, such a law can still apply temporarily. This is a shocking position adopted by the Supreme Court to protect the government’s illegal actions.

In its appeal to the Supreme Court, the state contended that, having found the Act unconstitutional, the Court of Appeal should have suspended that declaration of invalidity. The Supreme Court accepts that invitation and holds that where ‘a declaration of invalidity poses an existential crisis, courts worldwide have tailored mechanisms for handling the same. One among them is the remedy of suspension of invalidity’ (Para 225). The Court also held that the remedy is anchored on Article 23, which provides constitutional remedies as the provision uses the word ‘includes’. The Court then proceeded to hold that

[236] From the above analysis it is clear that a cautious approach would apply, such that a suspended declaration should only be issued where in the public interest, there exists a set of facts that are very unique and demand for that suspended declaration, such as to avoid a vacuum in the law, a threat to the rule of law, lawlessness, chaos or anarchy. Certainly, it may apply to the questions posed hereinabove as to resolving a possible crisis in the public law policy and practice.

That, due to the nature of a finance bill, the Court of Appeal should have fashioned a remedy that suits the peculiar circumstances of the case, and the preferred remedy would have been to suspend the invalidity to allow parliament to take remedial measures.

However, the Court’s finding is not supported by the Constitution of Kenya. First, Article 2 of the Constitution establishes the supremacy of the Constitution and explicitly provides that any law inconsistent with the Constitution is invalid. Once a court declares that the law is unconstitutional, Article 2(4) automatically kicks in, bringing in the immediate invalidity of such a law. Put differently, once a declaration to that effect is made, it is dead and cannot be used to regulate the affairs of the citizens. Further, Article 2(4) of the Constitution does not give the Court any jurisdiction beyond the declaration of unconstitutionality (unlike in South Africa, where Article 172 asks Judges to suspend a declaration of invalidity). Actually, the declaration of unconstitutionality does not establish the unconstitutionality but merely recognises or announces it. For as long as Article 2(4) of the Constitution remains part of our laws, a judge cannot resuscitate an unconstitutional law. Indeed, the Supreme Court in the BBI judgment held that ‘This makes a declaration of invalidity of any law a remedy that a court ought to grant in case it finds a law to be incompatible with the Constitution. The effect of such a declaration of invalidity is that the declared law becomes ineffective as though it is not in the statute book.’

 A suspended declaration of invalidity overturns this constitutional logic. It, in effect, asks citizens to comply with a law that a Court has found to be unconstitutional. Indeed, the remedy allows the Constitution to be frozen in time. This is because the Constitution and an unconstitutional statute cannot coexist. If an unconstitutional statute is allowed to operate, it means that the Constitution can bleed for some time, a position not supported by Article 2. This position finds favour in a 2014 holding of the Court of Appeal in Shabhal, where the Court held that the Court cannot ignore Article 2(4)  and find that ‘a statute that is blatantly violative of the Constitution can form the foundation of valid legal claims’. Further, ‘the idea that statutory enactments contrary to the Constitution can claim even fleeting validity’ should not be countenanced, let alone entertained. Holding otherwise would be contributing to the erosion of the supremacy and preeminence of the Constitution in the hierarchy of legal norms. In sum, statutes declared unconstitutional cannot claim fleeting validity, and no court, even the apex court, has jurisdiction to craft remedies that can give them a fleeting validity. As recently observed by Justice Chacha Mwita, once Article 2(4) kicks in, a court of law cannot suspend the operation of the constitutional provision by crafting an order suspending the constitutional invalidity.

Secondly, the Court anchors its finding on Article 23 of the Constitution. The provision reads: “In any proceedings brought under Article 22, a court may appropriate relief, including […].” Article 22 provides the locus standi for people to approach court where there is a violation or a threat of violation of the Bill of rights. Although Article 23 does not define appropriate relief, this is supposed to be an effective relief capable of protecting and enforcing the Constitution. Although courts are free to fashion even new remedies, the principal aim of a constitutional remedy is to vindicate the Constitution, deter future infringements and ensure that the Public has faith in the Constitution. This is in line with the jurisprudence of South Africa, from which the provision was borrowed. In Fose, the Constitutional Court defined the term as follows: ‘in our context an appropriate remedy must mean an effective remedy, for without effective remedies for breach, the values underlying the rights entrenched in the Constitution cannot properly be upheld or enhanced’. The Supreme Court has endorsed Fose in Wamwere, Mitu Bell, CMM, Musembi and EPZ.

Although the list of remedies in Article 23 is not exhaustive, Courts can only fashion an appropriate remedy capable of vindicating the Constitution and deterring future violations. Suspension of the declaration of invalidity does not serve either of these purposes. Instead of vindicating the Constitution, it allows for its violation. Neither does it deter future violations, but it is only a slap on the wrist for the state.

Thirdly and finally, suspension of the declaration of invalidity violates Article 10 of the Constitution. Article 10 establishes a normative state based on values such as good governance, the rule of law and accountability. Such a framework cannot countenance a situation where citizens are compelled to comply with an unconstitutional law through judicial fiat. Put differently, unconstitutional laws cannot obtain any form of validity through judicial imprimatur. An effective remedy protects the values and not one that gives room to more violations or undermining of the values. And as the Court of Appeal held while refusing to stay the High Court Finance Act Judgment, ‘The other important point to bear in mind is that public interest is represented by constitutional values. Therefore, application of public interest must conform with theConstitution. Article 2(4) of the Constitution affirms the supremacy of the Constitution relative to ordinary statutes’.

In sum, an appropriate relief is capable of effectively striking at the source of the violation by way of enforcing the Constitution and ‘strike a blow to any future incentives for any state organ, state officer or public officer to violate, infringe and or frustrate a legitimate constitutional or legal process’. A declaration of suspended invalidity does not strike at the source of violation nor strike a blow to any future incentives for any state organ to violate the Constitution. Instead, it tells the state that it is fine to violate the Constitution since any declaration of invalidity will be suspended. Further, in its formulation of suspension of invalidity, the Supreme Court surrendered its power to sanction government inertia or the court’s obligation to respect, uphold and defend our transformative Constitution and its essential values, including the rule of law.

Suppose the Supreme Court wants to avoid disruption due to the immediacy of the declaration of invalidity. In that case, it can combine the remedy of reading in with that of a suspended declaration of invalidity. The remedy of reading in ensures that the Constitution will not be allowed to bleed at any time.

‘May you live in interesting times’ and concurrence

While in South Africa, Robert F Kennedy paid homage to a Chinese Curse which says, “May he live in interesting times.” He noted that whether people like it or not, they live in interesting times. These times are both dangerous and uncertain, but they are also the most creative of any time in the history of mankind. The Court’s analysis on the issue of concurrence falls under this caution. It demonstrates an interesting time when the Supreme Court becomes innovative and abdicates its jurisdiction in ways no man could have imagined.

One of the grounds fronted at the High Court and Court of Appeal against the Finance Act, 2023, was that enacting the Act violated Article 110(3) of the Constitution. The provision requires the joint concurrence of the parliament speakers before a bill is considered in either house. The concurrence is required to determine if the bill concerns counties and, therefore, should also be considered by the Senate. The High Court and Court of Appeal found that the Finance Act is a money bill and, by virtue of Article 114, the Senate does not have a role to play.

In the Cross Appeal to the Supreme Court, the Cross Appellants faulted the Court of Appeal for holding that the Finance Act, 2023 was a money bill and did not require the concurrence of the Speaker of the Senate and as such the lack of the concurrence vitiated the Act as the Act contained clauses touching on county functions. The Cross Appellants argued that the Court of Appeal conflated a money bill with a bill concerning counties. In summary, they argued that whether a bill goes to the Senate or not does not depend on the classification of whether the bill is a money bill or not, but whether the bill touches on counties.

In its judgment, the Apex Court does not answer the question posed to it. The decision does not show the court’s position on whether money bills must be subjected to the concurrence process. Although the Court upholds the finding that the Finance Bill is a money bill, it does not explicitly answer whether money bills should be subjected to a concurrence process. Interestingly, however, is the court’s analysis of the concurrence process. The court observes that the Senate speaker on 15 June 2023 wrote to the Speaker of the National Assembly informing him that the bill concerned counties (later withdrew this letter on 21 June 2023). The Apex Court holds that while it is not clear why there was a change of heart, it is clear that there was concurrence.

The finding is problematic on several fronts. First, should money bills be subjected to the concurrence process? The Court of Appeal expressly found that the money bills are exempt from the concurrence process. The Supreme Court does not answer this question and leaves it hanging. Second, what happens to the Court’s jurisprudence that the concurrence requirement is a condition precedent? The Supreme Court in In the Matter of the Speaker of the Senate and another [2013] eKLR, at para 144, interpreted the provisions of Article 110(3) the Constitution to mean that:“(i) the requirement for a joint resolution of the question whether a Bill is one concerning counties, is a mandatory one”; (ii)   “the business of considering and passing of any Bill is not to be embarked upon and concluded before the two Chambers” settle the nature of the Bill; and (iii) the two Houses must settle the question before a Bill that has been published, goes through the motions of debate, passage, and final assent by the President. In this case, the Bill was published and debated upon prior to that concurrence, contrary to the Court’s holding.

Third, if the Speakers of parliament have concurred that the bill does not concern counties, are courts bound by that decision? In this case, the Cross Appellants singled out two provisions of the Bill that touch on counties. The Cross Appellants urged the Court to find that the bill touched on counties and required concurrence before it was tabled in the National Assembly. The Court finds that the speakers concurred, albeit after the fact, and ends its analysis there. The Court sets a precedent where captured speakers would concur to inoculate bills from reaching the Senate, a house meant to protect devolution. It was the Court’s role to consider the provisions within the Act and whether they touched on counties. If indeed they touched on counties, was there concurrence before the publication and consideration of the bill? The deferential approach adopted by the Court betrays the leitmotif of the Constitution.

Fourth, what conclusion does the Court draw from the fact that the Speaker of the Senate withdrew an earlier position that the bill concerned counties? As a sentinel and guardian of the Constitution, wasn’t the court required to enforce the national values of accountability, transparency and the duty to offer reasons? In my view, the court was supposed to ensure that public officials, especially those holding high and key positions, do not flip-flop or perpetuate convenient stances on issues. The Court dropped a ball on this.

So, in these interesting times, the Apex Court allowed a concurrence by speakers (obtained through questionable ways) to be binding even on courts. Once the speakers have concurred, the court folds its hands and does no more, and a house speaker can take different positions at any time. Such a stance taken by the Apex Court is disappointing and a dereliction of duty.

Conclusion

This blog post, divided into two parts, sought to demonstrate what I think is the problem with the Finance Act decision. Although courts attract highly contentious and political cases which might attract unwanted attention, ‘the men and women on the bench should not blink’. Unfortunately, the Supreme Court blinked in the Finance Act, 2023 decision. In the name of separation of powers and what others would call ‘dialogical constitutionalism’, the decision carves out a large loophole for the recalcitrant Executive and a potentially captured parliament to explore. Unfortunately, the Supreme Court has allowed itself to be a part of such a loophole, and distance itself from its constitutional obligations by being extremely deferential: this may only be described as a constitutional travesty.