[2020] KECPT 5 (KLR)

REPUBLIC OF KENYA

IN THE CO-OPERATIVE TRIBUNAL

AT NAIROBI

TRIBUNAL CASE NO.394 OF 2019

CITY STAR SACCO SOCIETY LIMITED..........…………........CLAIMANT

VERSUS

SIMION MACHIRAH NDIRANGU........................................... RESPONDENT

RULING

What is before us for consideration and determination is the Respondent’s Application dated 23. 1.2020. It seeks for the following Orders:

1. Spent;

2. That the judgment herein be set aside;

3. That there be a stay of execution of the decree obtained herein until hearing and determination of this Application; and

4. That the Applicant/ Respondent be at liberty to cross –examine the Process Server who claimed to have served the summons and other accompanying documents upon him.

The Application is supported by the grounds on its face and the Affidavit sworn by Simon Machirah Ndirangu on 22. 1.2020.

Despite service of the Application, the Claimant has not filed a response to the Application. It has, instead, filed written submissions on 27. 10. 2020. This is a period of over one (1) month since the date when the matter was fixed for Ruling. We will nevertheless determine the Application based on the material on record.

Respondent’s contention

Vide the instant Application, the Respondent content that it was not served with summons to enter appearance before request for judgment was made in the matter. That in lieu of this, the ex- parte judgment should be aside ex debito justiciae.

Claimant’s contention

Vide his submissions filed on 27. 10. 2020 the Claimant contend that the Respondent’s statement of Defence does not raise any triable issue. That the same constitute a ploy to delay the Claimant from recovering the loan owed by the Respondent. It referred to the case of Patel -vs- EA Cargo Handling Services Limited (1994) to support its contention that the judgment on record is a regular one.

Issues for determination

The Respondent’s Application has raised the following issues for determination:

a. Whether the Respondent has raised a proper basis to warrant the setting aside of the default judgment entered on 4. 11. 19.

b. Who should meet the costs of the Application.

Setting aside of exparte judgment

We have jurisdiction to set aside a default judgment by dint of Order 10 Rule 11 of the Civil Procedure Rules. The Rule provides thus:

“ Where judgment has been entered under this Order, the court may set aside or vary such judgment and any consequential Decree or Order upon such terms as are just.”

In the case of Patel – vs- East Africa Cargo Service Limited (1974)EA 75, the Court underscored this provision in the following terms:

“ The main concern of the court is to do justice to the parties and the court will not impose conditions on itself to fetter the wide discretion given to it by the Rules.”

Before we can exercise our jurisdiction under Order 10 Rule 11 above, we firstly have to ascertain whether the default judgment is a regular or irregular one. If the Judgment is an irregular one, then we will set it aside ex debito justiae.

This was the holding in the case of K- Rep Bank Limited -vs- Segment Distributors Limited [2017] eKLR.

The court in the case of Fidelity Commercial Bank Limited – vs- Owen Amos Ndungu & Another, HCC.NO. 241/1998 gave a distinction between a regular and irregular judgment as follows:

“ A distinction is drawn between regular and irregular judgments. Where summons to enter Appearance has been served and there is default in entry of Appearance the ex parte judgment entered in default is regular. But where the exparte judgment sought to be set aside is obtained either because there was no proper service or any service at all, of the summons to enter appearance, such judgment is irregular and the affected Defendant is entitled to have it set aside as of right”

Where the default judgment is regular, then the Tribunal has to consider if the draft Defence filed with the Application raises triable issues. This was the holding in the case of James Kanyiita Nderitu & Another - vs- Marios Philotas Ghikes & Another [2016]eKLR. In the pertinent part, the court held thus:

“ In a regular default judgment, the Defendant will have been duly served with summons to enter appearance, but for one reason or another, he failed to enter appearance or to file a Defence, resulting in default judgment. Such a Defendant is entitled under Order 10 Rule 11 of the Civil Procedure Rules to move to court to set aside the default judgment and to grant him leave to defend the suit. In such a scenario, the court has unfettered discretion in determining whether or not to set aside the default judgment and will take into account such factors as to the reason as for the failure of the Defendant to file his memorandum of Appearance, or defence, as the case may be, the length of time that has elapsed since the default judgment was entered; whether the intended Defence raises triable issues, the respective prejudice each party is likely to suffer whether on the whole, it is in the interests of justice to set aside the default judgment.”

With the foregoing principles in the fore, a question arises as to whether the current Application has met the requisite threshold for setting aside ex parte judgment. We will look at the principles thematically as follows:

Service of summons

The Respondent has vehemently denied being served with summons to enter appearance. He has faulted the averments contained in the Affidavit of Service sworn by Thomas Otieno Akech on 10. 9.2019. That contrary to the contentions that he was served at Nyeri County Government where he is employed, he is in fact not an employee of the County in any capacity. That further, at no point in time has he been an employee of the Teachers Service Commission (TSC). That as a result, the judgment was obtained out of deliberate misrepresentation of facts.

On the basis of the judgment in the Fidelity Commercial Bank case above, the judgment entered on 17. 10. 2019 is irregular. We say so taking into account the fact that the Claimant did not file any document to controvert the foregoing contentions raised by the Respondent. This being the case, we find that the current Application will succeed on this point alone. There is no need to ascertain whether or not the draft Defence raises triable issues. Service of summons to enter Appearance is quite critical and goes to the roof of the judgment on record,.

Conclusion

Based on the foregoing, we allow the Respondent’s Application dated 23. 1.2020 based on the following terms:

a. The Respondent to file and serve a statement of Defence alongside witness statements and list and bundle of documents within 21 days herein;

b. The Claimant to file a Reply to the Response as well as amended witness statements and supplementary list and bundle of documents within 21 days of service;

c. Mention (virtually) to confirm compliance and fixing a hearing date on 11. 12. 2020; and

d. No orders as to costs.

Ruling signed, dated and delivered at Nairobi this 29thday of October, 2020.

Hon. B. Kimemia Chairperson Signed 29. 10. 2020

Hon. F. Terer Deputy Chairman Signed 29. 10. 2020

Mr. P.Gichuki Member Signed 29. 10. 2020

Court Assistant C. Maina

Hon. F. Terer Deputy Chairman Signed 29. 10. 2020