[2021] KECPT 501 (KLR)

REPUBLIC OF KENYA

IN THE CO-OPERATIVE TRIBUNAL AT NAIROBI

TRIBUNAL CASE NO.174 OF 2020

FELISTER WAMBUI MWAURA ....................................................................CLAIMANT

VERSUS

AMICA SAVINGS & CREDIT...............................................................1ST RESPONDENT

WATTS AUCTIONS..............................................................................2ND RESPONDENT

RULING

Vide the Application dated 7. 7.2020, the Claimant has moved this Tribunal seeking for Orders inter alia:

1. That this Application be certified as extremely urgent and service thereof be dispensed with in the first instance;

2. That this Honorable Tribunal be pleased to issue a temporary order of injunction against the 1st and 2nd Respondents from selling, disposing and/or in in any manner alienating land parcel Number NDARUGU/GAKOE/997 within Gatundu North, sub-county pending the hearing and determination of this application;

3. That this Honorable Tribunal be pleased to issue a temporary order of injunction against the 1st and 2nd Respondents from selling, disposing and/or in in any manner alienating land parcel Number NDARUGU/GAKOE/997 within Gatundu North, sub-county pending the hearing and determination of this claim;

4. That cost of this application be provided for.

The Application is supported by the grounds on its face and the Affidavit sworn by herself on even date 7. 7.2019.

The Respondent has opposed the Application vide the Replying Affidavit sworn by Pius M. Itira on 17. 7.2020.

Vide the directions given on 5. 8.2020, the Application was canvassed by way of written submissions. The Claimant filed hers on 15. 9.2020 while the Respondent did so on 31. 8.2020.

Claimant’s Contention

Vide this Application, the Claimant wants an order restraining the Respondents from advertising her property LR.NO.NDARUGU/GAKOE/997 on grounds that the same is family property hosting their matrimonial home. That she offered the said property in the year, 2016 as security for a loan of Kshs.6,000,000/=. That due to circumstances beyond her control, she defaulted in repaying the said loan. That the said loan was applied towards purchase of exotic timber from theKenya Forest Service.That the said loan was wired directly to Kenya Forest Service vide bankers cheque. That as soon as she received the said loan and in 2017 to be particular, the Government imposed a ban of logging of Kenya Forest Service trees for a period of 3 years. That the said moratorium was extended periodically. That the said moratorium has adversely affected her business in that she cannot harvest and sell timber.

That even in the wake of the said moratorium, she has made efforts to repay the loan. That whilst she admits having defaulted in repayment of the loan, the same is for a short period. That if the auction process is allowed to proceed, she will suffer irreparable loss.

Respondent’s Case

The Respondent has opposed the Application on the ground that the loan taken by the Claimant was to be repaid on a specific period of time, that is, 60 months with monthly installments being Kshs.142,098/=. That the loan was disbursed to the Claimant on the security of the suit property and subsequently, she has defaulted in its repayment thus making it inevitable to recover the same. That the Claimant has admitting borrowing and also defaulting in repaying the said loan. That being a borrower and charger, the Claimant clearly understood her responsibilities of repaying the loan on time. That she cannot therefore seek the court’s sympathy for her own omissions.

That the Claimant has no contract with Kenya Forest Service and that if one existed she would have produced documents to that effect. That the Respondent will stand to suffer irreparably if the said loan is not paid.

Issues for determination

The Claimant’s Application has presented the following issues for determination:

a.Whether the Claimant has laid a proper basis to warrant the grant of a temporary injunction.

b.What orders are available in the circumstances?

Temporary injunction

We have jurisdiction to make an order regarding temporary injunctions by dint of order 40 of the Civil Procedure Rules. Order 40 Rule 1 (a) provides thus:

“ Where in any suit it is proved by Affidavit or otherwise –

(a) That any property in dispute in a suit is in danger of being wasted, damaged, or alienated by any party to the suit, or wrongly sold in execution of a decree, the court may by order grant a temporary injunction to restrain such act, or make such other order for the purpose of staying and preventing the wasting, damaging, alienation, sale, removal, or disposition of the property as the court thinks fit, until the disposal of the suit or until further orders.

Before exercising the above jurisdiction, we are guided by the Principles enunciated by the court in the case of Giella – versus- Cassman Brown [1973] EA. They include:

(a) A prima facie case with a probability of success;

(b) Irreparable damage; and

(c) Balance of Convenience.

The court in the case of Mrao Limited versus first American Bank of Kenya Limited (2003) eKLR explained what Constitute a Prima Facie case in the following terms:

“.......A Prima Facie case is more than an arguable case. It is not sufficient to raise issues. The evidence must show an infringement of a right and the probability of the Applicant’s case upon trial. It is a case which on the material presented, to the court, a Tribunal properly directing itself will conclude that there exists a right which has apparently been infringed by the opposite party as to call for an explanation from the latter......”

It follows therefore that for a party to establish the existence of a prima facie case with probability of success, he/she must establish that he/she has a right which has been infringed by the opposing party so as to call for a rebuttal by the said party. The question abound therefore as to whether the Claimant has demonstrated that she indeed has the said right.

We have considered the Application, its annextures, the Response thereto and the written submissions. What is put in contest is that there is no dispute about indebtedness of the Claimant to the 1st Respondent. Secondly there is also no dispute as regards the Claimant’s default in repaying the said loan. The only reason why the Claimant is seeking refuge from the Tribunal is that the loan did not serve the purpose for which she applied for and as such, she has felt into arrears.

As the Respondent contend, the Claimant applied for and was granted a loan of Kshs.6,000,000/= back in the year, 2016. She offered property LR. NO. NDARUGU/GAKOE/997 as security for the said loan. The said property was processed and charged as provided for by law. The Claimant has defaulted in repayment of the said loan and therefore the 1st Respondent’s right to realize its security has accrued.

Whilst the Claimant has urged that she will suffer irreparably if an order of injunction is not granted, we also note that the 1st Respondent and its members will even suffer most if the order is granted. The monies advanced to the Claimant do not belong to the 1st Respondent but rather its members. If the said monies are not repaid and when they fall due, definitely the 1st Respondent will run into liquidity problems. The net effect will be that it will not be in a position to meet its members obligations. The next thing we will hear is insolvency. Therefore, by asking us to stop the 1st Respondent from realizing and/or recovering the said monies, the Claimant is simply asking us to aid in incapacitating the 1st Respondent. We cannot do so.

Whilst we sympathize with the Claimant for her financial predicament, we equally sympathize with the members of the 1st Respondent whose savings and deposits are at risk as a result of the Claimant.

The long and short of this is that we are not convinced that the Claimant has set out a prima facie case with a probability of success.

Conclusion

The upshot of the foregoing is that we do not find merit in the Claimant’s Application dated 7. 7.2020 and hereby dismiss it with costs in the cause. Orders accordingly.

Ruling signed, dated and delivered virtually this 25th day of March, 2021.

Hon. B. Kimemia Chairperson Signed 25. 3.2021

Hon. Jane Mwatsama Deputy Chairperson Signed 25. 3.2021

Mr. P. Gichuki Member Signed 25. 3.2021

Kimani holding brief for 1st and 2nd Respondent.

Hon. B. Kimemia Chairperson Signed 25. 3.2021