Acre Moja Savings & Credit Co-operative Society v Adanje & 2 others (Tribunal Case E001 of 2025) [2026] KECOPT 297 (KLR) (21 July 2026) (Judgment)

Acre Moja Savings & Credit Co-operative Society v Adanje & 2 others (Tribunal Case E001 of 2025) [2026] KECOPT 297 (KLR) (21 July 2026) (Judgment) Neutral citation: [2026] KECOPT 297 (KLR) Republic of Kenya In the Cooperative Tribunal Tribunal Case E001 of 2025 J Mwatsama, F Lotuiya & M Chesikaw, Members July 21, 2026 Between Acre Moja Savings & Credit Co-operative Society Claimant and Daniel Adanje 1st Respondent Evans Wanyama Musime 2nd Respondent Tom Akal Khisa 3rd Respondent Judgment 1.The matter for determination is Statement of Claim dated 28/1/2025 where Claimant avers the 1st to 3rd Respondent were officials of Claimant Society. The Society was registered on 9/9/2014 and held its first Annual General Meeting on 11/10/2014 electing ten (10) officials. The Claimant avers a bank account was opened Account no. 01120536931000 with the signatories being Tom Akal - Chairperson, Evans Musime Wanyama – Treasurer, Ruth Naswa wafula – Member and Catherine Bikondo – Vice Chairperson. 2.Between 17/8/2015 and 23/10/2019 the Society began having financial challenges and investigations conducted by Claimant’s board. The investigations established financial irregularities to Society’s non-members. The amount in total was Kshs. 15,232,608.00/= all cheques paid to non-members. Another Annual General Meeting was held on 30/4/2022 and membership informed of the embezzlement which affected Claimant’s Society operations. 3.The delegate meeting resolved that all signatories who authorized and signed the said cheques be contested and give explanation on the irregular payments. On 29/11/2022 demand letters were done. As such the Claimant Society filed suit seeking for prayers:a.This Honourable Tribunal do issue an order finding the Respondents to have deliberately conspired and/or colluded in signing and authorizing irregular cheque payments of Kshs. 15,232,608/= to non-members of the co-operative society in breach of law.b.The Honourable Tribunal do issue an order directing the Respondents pay the Claimant the sum of Kshs. 15,232,608/=.c.The costs of these proceedings/suit be provided for. 4.The Claimant filed Witness Statement and List of Documents filed on 28/1/2025 which had the following documents as evidence:1.Claimant's Co-operative Bank Account.2.Claimant's certificate of Registration.3.Copy of claimant's bank signatories dated, 9/1/2015.4.Copy of claimant's annual general meeting dated, 11/10/2014.5.Claimant's KRA Pin Certificate.6.Copy of claimant's by-laws.7.Copy of letter to Daniel Andanje dated, 29/11/2022.8.Copy of letter to Evans Wanyama dated, 29/11/2022.9.Copy of letter to Tom Akal Khisa dated, 29/11/2022.10.Copies of irregular cheques dated between 17/B/2015 to 23/10/2019 5.The Respondent did not respond to claim and Default Judgment entered against them on 19th June 2025. Matter came for formal proof on 21/7/2026. The CW1 – Fredrick Maisiba the Chairman adopted his Witness Statement filed on 28/1/2025 as his evidence in chief and produced documents filed on 28/1/2025 as Claimant’s Exh.1-10.His request was to recover those amounts irregularly paid out by the Respondents.On clarification when asked by the Tribunal members he stated he informed the Commissioner’s office who informed them to go report to the relevant authorities, that is, police. He confirmed no action was taken by the Commissioner for Co-operative Development office concerning the same. No inquiry report, no surcharge. 6.This is a very interesting case where the Society have sued their former officials rightly so to recover amounts that were irregularly processed. However, the process towards filing suit is what is wanting. Section 58 of the Co-operative Societies Act Cap 490 provides for:“(1)The Commissioner may, of his own accord, and shall on the direction of the Cabinet Secretary, as the case may be, or on the application of not less than one-third of the members present and voting at a meeting of the society which has been duly advertised, hold an inquiry or direct any person authorized by him in writing to hold an inquiry, into the by-laws, and the working and financial conditions of any co-operative society.(2)All officers and members of the co-operative society shall produce such cash, accounts, books, documents and securities of the society, and furnish such information in regard to the affairs of the society, as the person holding the inquiry may require.(3)The Commissioner shall report the findings of his inquiry at a general meeting of the society and shall give directions for the implementation of the recommendations of the inquiry report.(4)Where the Commissioner is satisfied, after due inquiry, that the Committee of a co-operative society is not performing its duties properly, he may—(a)dissolve the Committee; and(b)cause to be appointed an interim Committee consisting of not more than five members from among the members of the society for a period not exceeding ninety days.(5)A person who contravenes subsection (2) shall be guilty of an offence and shall be liable to a fine not exceeding two thousand shillings for each day during which the offence continues”.It is only the Commissioner for Co-operative Development that can initiate an inquiry in other words investigation upon application of majority of management committee or not less than one third of registered members in a Society. 7.Only after the inquiry is done and a report presented to the members of a Society will a surcharge order follow to recover amounts lost in the Society.The Claimant Society cannot on their own motion take up the matter and prosecute the Respondents at will even with glaring proof against them. 8.With this in mind the claim herein cannot be entertained by the Tribunal as it is not properly placed before it as it offends Section 58 of the Co-operative Societies Act. The cause of action is yet to crystalize for there to be a claim. We wonder how the Kakamega County Commissioner Co-operative Development operates as this is negligence on their end.As such the Statement of Claim dated 28/1/2025 is found to be without merit and case is dismissed with no orders as to costs. JUDGMENT DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 21ST DAY OF JULY, 2026.HON. J. MWATSAMA CHAIRPERSON SIGNED 21/7/2026HON. F. LOTUIYA MEMBER SIGNED 21/7/2026HON. M. CHESIKAW MEMBER SIGNED 21/7/2026Court Assistant – Jemimah Koki