Strathmore University

Justice delayed is justice denied. In Kenya, the 2019/2020 government records shows that it takes about three years to resolve a case in court with a total of 600,000 case backlog, half of which are civil cases.  For family business, case delays have serious negative impact on family relationships and business sustainability.  

In 2019/2020, the Kenyan judiciary mediation pilot project resolved about  50% of 2,000 cases in 90 days, which released the equivalent of USD 40 Million to the Kenya economy. We obtained similar results in a project with the Kenya Bankers Association in 2014. Winning the elevate prize would enable the scaling up our current activities to provide 24 hour mediation services to have a speedy resolution of commercial and family disputes.

Our project innovatively aims to reduce disputes before they occur by making a family business constitution (FBC) an enviable document for all family businesses in Kenya.  An FBC is an agreement among family members on how to avoid family business dispute and, if they occur, resolve them by mediation. 

Reducing the number of civil cases in court would also allow the courts to dedicate more time to conclude criminal cases hence improving overall access to justice.

I'm currently a director and mediator at Strathmore Dispute Resolution Centre (SDRC) and a faculty member at Strathmore University Business School where I teach courses on entrepreneurship and family business among others.  I'm also currently the deputy vice-chancellor of Strathmore University. 

In the early 2000's I had the unfortunate experience of having one of my family business course student who sought my advice about an ongoing court business case. The student business' brand new transportation truck had illegally been impounded by traffic policemen and declared unroadworthy since the student refused to give a bribe to the policemen. For the previous one year the family business was paying interest on the bank loan used to purchase the truck, it had lost business in transportation services and it was paying legal fees to its lawyers amongst other expenses.

This incident generated my interest on alternative dispute resolution methods and I finally became a practising accredited mediator. Based on my experience  I've seen the benefits of resolving family  and commercial cases through mediation. Worthy of mention, is a case where I successfully mediated a dispute between a mother and her two daughters whose joint family business  was at the point of collapse.

The Strathmore Dispute Resolution Centre (SDRC) is a dispute resolution centre at the Strathmore University Law School. Strathmore University (SU) is a private non-profit making University in Kenya which started as the first multiracial College in pre-independent Kenya in 1961 and became an accredited university in 2018. Currently the University has about 7000 students across five degree granting schools and various professional courses including for families and entrepreneurs. The University's foundational motto, "that all may be one" still guides its current vision  "To be a leading entrepreneurial university positively impacting society by doing excellent work"

One way SU is impacting society is through its research centres like SDRC which was established to promote the use of alternative dispute resolution methods in Kenya. SDRC predominantly resolves disputes using mediation due to the method's ability to rebuild the relationship between parties in a dispute. 

Winning the Elevate prize would enable SDRC to scale up its mediation centre through initiatives to

    ii.         increase awareness and uptake of mediation in resolving family and commercial disputes

   iii.        promote adoption of a Family Business Constitution (FBC) with a mediation clause by majority of family businesses in Kenya.

Despite the adage "to error is human" research shows that due to the underestimated emotional impact on the decision making process, people do at times make irrational decisions.  This is one reason why, even in Kenya where the average duration to resolve a court case is three years, Kenyans are still filling new cases in court instead of the more rational option of using alternative dispute resolution methods.   Essentially, when a dispute occurs, one or both of the parties assume that the other party(ies) have intentionally caused the dispute to occur. The immediate emotional decision is to retaliate by going to court and "teach them a lesson"

Our proposed project aims to encourage parties to agree, before the dispute occurs, that, if a dispute does occur, such a dispute will be resolved using mediation.  We aim to do this by having family business write a agreement document called the family business constitution which among other aspects includes an agreement to resolve disputes through mediation.  Given the prevalence of high profile family business disputes in Kenya, our project will popularize the use of mediation in other disputes hence reducing the case backlog in Kenyan courts.

In Kenya, Small Medium Enterprises (SMEs) contribute 31.4% of the Gross Development Product (GDP). Additionally, about 70% of SMEs are family owned. In the last 12 years I have been the program lead at Strathmore University Business School for an entrepreneurship program focused on medium sized companies in Kenya, majority of which are family owned businesses.  One of the regular course unit is on dispute resolution through mediation.  

Even though we have increased awareness about mediation in Kenya's family businesses which come to Strathmore University courses, the uptake of mediation is still very low.  This is partly because most agreements do not include a mediation dispute resolution clause.  

In an effort to alleviate this problem we have recently started promoting the  adoption of  family business constitution (FBC) by family owned business in Kenya. In March 2021, SDRC held a webinar  nf FBC attended by over 200 business owners. The webinar was sponsored by a private bank which has agreed to sponsor a second webinar in  May 2021.

In the meantime myself and my colleagues at SDRC have developed a free for download FBC template which is available to all family business in Kenya. The template is available here