[2021] KECPT 235 (KLR)

REPUBLIC OF KENYA

IN THE CO-OPERATIVE TRIBUNAL

AT NAIROBI

TRIBUNAL CASE NO.177 OF 2021

ELIAS MUTURI NJIRU..........................................................................CLAIMANT

VERSUS

NAWIRI SACCO SOCIETY LIMITED...................................1ST RESPONDENT

GIANT AUCTIONEERS............................................................2ND RESPONDENT

RULING

1. The Application dated 8/4/2021 is for determination and the same is brought under Section 1A, 1B,3A & 63E of the Civil Procedures Act Cap 21. Order 40 Rules 1, 2 & 3 of the Civil Procedure Rules 2010.

The same seeks for orders:

1. Spent.

2. THAT pending the hearing and determination of this Application inter-parties, this Honourable court be pleased to order stay of sale by public auction against the 1st and 2nd Defendant/ Respondents, their agents, employees, servants or anyone claiming through them the sale, auction of the Plaintiff’s/Applicant’s parcel of land NGANDORI/KIGIRI/T143 in Embu Town on Friday 9th April,2021 pending the hearing and determination of this Application inter parties.

3. THAT pending the hearing and determination of this suit, this Honourable court be pleased to order stay of sale by public auction against the 1st and 2nd Defendant/ Respondents, their agents, employees, servants or anyone claiming through them the sale, auction of the Plaintiff’s/Applicant’s parcel of land NGANDORI/KIGIRI/T143 in Embu Town on Friday 9th April,2021 pending the hearing and determination of this Application inter parties.

2. The same is premised on the ground on the face of the Application and Supporting Affidavit of Elias Muturi Njiru filed on 9/4/21 where he avers that he is the registered owner of Ngandori/Kirigi/T143 situated in Embu county. That he applied for a loan of Kshs.2,500,000/= from the 1st Defendant on 26/8/19 using his parcel of land as security. He diligently served his loan until the emergence if the Corona pandemic and as a result, his business was affected and was unable to adequately service his loans.

That the Respondent had not tabulated some monies he had paid and the 2nd Respondent with instruction from the 1st Respondent has proceeded to advertise the sale of land Ngandori/Kirigi/T143.

3. The Applicant further avers the 1st Respondent actions are unprocedurally and illegal as they did not serve the notice as required by law.

That he is willing to completely service his loan once accounts are taken and correct amount due is presented. He also seeks for the loan to be restricted to enable him sufficiently service the loan. The Application will not occasion any prejudice on the Respondent.

4. The Respondent filed a Replying Affidavit sworn by Joseph Mwaniki Kithinjion 15/4/21 in opposition to the Application. He is the Credit Manager for the 1st Respondent and stated the Applicant approached the 1st Respondent on 26/8/19 requesting for a loan facility of kshs.2,500,000/= which was granted and gave his land parcel number as security for the loan.

The Claimant failed to pay the loan and requested for reprieve because of COVID-19 pandemic and was given a repayment break of 6 months and was to resume payment in September,2020 which he failed to honor and demand notice was issued.

5. The 2nd Respondent under the instruction of the 1st Respondent proclaimed the security and issued a redemption notice for 40 days dated 24/11/20 and annexed the said notice as JMK 7.

That on 8/1/21 the Applicant requested for a further reprieve and grace period of 3 months to clear the loan arrears and update his monthly installment which request he did not honour.

Applicant’s letter is attached as JMK9.

On 9/3/21 the 2nd Respondent under instructions from the 1st Respondent issued a Notification of sale of the charged property to recover the loan which the Applicant failed to pay. The Notification of sale is annexed marked JMK9.

It was only after the issuance of the Notification of sale of the charged property that the Claimant/Applicant sought refuge of the Tribunal and obtained temporary injunction against the Respondent.

6. That the Applicant’s default has caused the 1st Respondent to start the lawful recovery process through the 2nd Respondent.

That the Respondent has followed due process and Applicant has unlimited access to its loan statement and other statements of accounts both diligently and on request as confirmed by annexture ENM 3 and has never complained to the 1st Respondent about any anomalies in the entries of the account and thus issue raised by Applicant in terms of figures and amount is an afterthought.

The Applicant has admitted he is in arrears and he has applied for loan repayment to be restructured and the same amounts to the repayment terms being altered. The Court is not obligated to rewrite a contract for the parties to suit the convenience of one party.

7. Parties were to file written submissions and the Claimant/Applicant filed their written submissions dated on 17/5/21 on 25/5/21 and Respondents filed their written submissions dated 3/6/21 on 8/6/21.

Having considered the pleadings and all materials before the court, the issues that ought to be determined are:

Issue One

Whether the Applicants are entitled to the orders sought?

Issue Two

Whether the Respondent followed the law in advertising the property Ngandori/Kirigi/T143 for sale?

Issue Three

Costs

8. ISSUE ONE

Whether the Applicants are entitled to the Orders sought

The Classic case of Giella –vs-Cassman Brown establishes the key elements/principles which court ought to look into before granting injunctive orders.

a) Prima facie case

The Claimant’s /Applicant’s aver their rights have been violated by the Respondent as they intend to sell land parcel Ngandori/Kirigi/T143 by way of public auction and the procedure laid out was not followed.

Further he states that he has been making payments to the said loan and challenges the amounts currently being payable as per the Respondent’s documents.

The Respondent on the other hand have stated the Applicant has defaulted and made requests on 8/1/21 for a relief despite two demand notices from the Respondent. The first notice on 14/10/2020 and 9/3/2021.

The Notification for sale and Redemption notice were also issued to the Applicant.

Having considered all this, the Applicants fail in this ambit.

b) Irreparable harm

The Applicants have not demonstrated the harm they would suffer should the case not be stopped.

They will definitely lose out on the land which they had given as security in case of default and there has been defaulted in payment of the loan.

The Applicant from the documents on record has been given sufficient notice and time to realize the loan.

The Respondent would suffer harm if payment is not made noting it is a Sacco which relies on members’ contribution to stay afloat.

The case of Marple Brooks Projects Company Limited & Another v I & M Bank Limited [2019] eKLR to wit.

“The next issue to address is whether the injury visited upon the Applicant should the conservatory orders not be granted could be compensated by way of damages. The principle generally is that where damages would suffice and the Respondent would be in a position to pay them, the court ought not to grant conservatory orders at an interlocutory stage. However, the position taken by Ringera J.A in the case of Kanorero River Farm Ltd and 3 Others v National Bank of Kenya Ltd 2002 2 KLR 207 was that “No party should be allowed to ride roughshod on the statutory rights of another simply because it could pay damages.”

c)Balance of Convenience

Case of Pius Kipchirchir Kugo vs Frank Mitei Tenas (2018) Eklr which defined a balance of convenience as:

“The meaning of balance of convenience in favor of the plaintiff is that if an injunction is not granted and the suit is ultimately decided in favor of the plaintiffs, the inconvenience caused to the plaintiff would be greater than that which would be caused to the defendants if an injunction is granted but the suit is ultimately dismissed. Although it is called balance of convenience it is really the balance of inconvenience and it is for the plaintiffs to show that the inconvenience caused to them would be greater than that which may be caused to the defendants. Should the inconvenience be equal, it is the plaintiffs who suffer. In other words, the plaintiffs have to show that the comparative mischief from the inconvenience which is likely to arise from withholding the injunction will be greater than which is likely to arise from granting it.”

The balance of convenience in this case tilts towards or in favour of the Respondent who have time and again accommodated the Applicant even upon default which default we note began due to Covid -19 pandemic.

The Court will not be held hostage or be persuaded with the excuse of COVID-19 pandemic in terms of loan repayment. There is a duty towards the Claimant to pay the loan.

9. ISSUE TWO

Whether the Respondent followed the law in advertising the property Ngandori/Kirigi/T143 for sale?

The 2nd Respondent received instructions from the 1st Respondent and the necessary procedural steps leading to the advertisement of the auction were followed.

There was a Notification of sale dated 9/3/21 and this what after necessary notice was given to the Application.

A redemption notice of 40 days was issued on 24/11/20. A Notification of sale followed on 9/3/21. All this was upon the default of the Applicant towards the loan.

The Applicant cannot now claim procedure was not followed and yet he had all notices issued to him. As alluded by the Respondent, he did not raise issues with the monies being owned as at the time of the notices being given.

ISSUE THREE

Costs follow the cause.

UPSHOT

The Application dated 8/4/21 is found to be with no merit and dismissed with costs.

Ruling signed, dated and delivered virtually this 2ndday of September, 2021.

Hon. B. Kimemia Chairperson Signed 2. 9.2021

Hon. J. Mwatsama Deputy Chairperson Signed 2. 9.2021

Mr. Gitonga Kamiti Member Signed 2. 9.2021

Mr. Boniface Akusala Member Signed 2. 9.2021

Tribunal Clerk R. Leweri

No appearance

Hon. B. Kimemia Chairperson Signed 2. 9.2021