[2020] KECPT 67 (KLR)

IN THE CO-OPERATIVE TRIBUNAL

AT NAIROBI

TRIBUNAL CASE NO. 1046 OF 2018

JOHN WANDERI MUYA ............CLAIMANT

VERSUS

AMICA SACCO LTD..............RESPONDENT

RULING

What is before us for consideration and determination is the Claimant’s Application dated 14/12/2018. It seeks, in the main, for orders inter alia;-

a. That pending the hearing and determination of the suit, the Tribunal be pleased to restrain the Defendant, whether by itself, its agents, servants and/or employees from selling or offering for sale property LR No. LOC 14/GAKURWE/1558; and;

b. Costs.

The Application is supported by the grounds on its face the supporting Affidavit sworn by the Claimant on event date.

The Respondent has opposed the Application by filing a Replying Affidavit sworn by Pius M. Hiira on 24/1/2019.

Claimant’s Case

Vide this Application, the Claimant contend that the Respondent has advertised the suit property for sale yet he has been repaying the loan. That the Respondent’s agents, Restores Consult Auctioneers have advertised the property for sale without issuing the mandatory three (3) months Notice.

The Claimant further contend that he had used the property to secure a loan of Ksh. 3,600,000. 00. That he paid Ksh. 2,900,000. 00 before June, 2016 and parties subsequently rescheduled the loan balance of Ksh. 1,800,000. 00 to run for 4 years i.e from June, 2016 to 2020 as the rate of Ksh. 51,000. 00 p.m. He has accused the Respondent for varying the loan amounts.

That on 5/12/2018, the Respondent advertised the property for sale vide the Standard Newspaper for sale upon expiry of 30 days.

That the proposed sale was premised on an alleged outstanding loan balance of Ksh. 2,960,343/10. That she dispose this amount.

Respondent’s Case

Vide the Replying Affidavit sworn by Pius M. Hiira the Respondent contend that on or about the year, 2017, it offered the Applicant the sum of Ksh. 3,600,000. 00. That the Claimant repaid the loan until it was rescheduled through his request vide a letter dated 10/5/16. That at the time of rescheduling, the outstanding balance was Ksh. 2,250,000. 00. That the Claimant later failed to repay leaving the loan to accrue with the outstanding balance as at the time of deponing to the Affidavit being Ksh. 2,127,136. 21.

That the Respondent reminded the Claimant about the loan on several occasion but he did not regularize his account.

That it was at this point that if instructed M/S Restorers Consult Auctioneers to realize the suit property. That the Claimant does not dispute the fact that he owes the Respondent the said outstanding balances.

That if the orders sought are granted, the Respondent will be highly prejudiced.

Disposal of the Application

Vide the directions given on 30/7/2019, the Application was disposed of by way of Written Submission. The Claimant filed his on 25/10/2019 while the Respondent did so on 6/10/2019. We will consider the said submissions, whilst determining the issues presented by the Application below.

Issues for determination

We have framed the following issues for determination;-

a. Whether the Claimant has laid a proper basis to warrant the grant of an Order of temporary Injunction; and

b. Who should bear the costs of the Application.

Temporary Injunction

This Tribunal has Jurisdiction to make an order regarding temporary Injunction by dint of Order 40 of the Civil Procedure Rules. Rule (a) thereof provides thus;-

“ Where any suit 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 wrongfully 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…….”

Before a court can exercise the above Jurisdiction, it must satisfy itself that the Principles for the grant of temporary Injunctions have been met. The said Principle, were enunciated in the local Classicus case of Giella –vs-Cassman Browns Co. Ltd[1973] EA 358.

The Principles include;-

a. A Prima facie case with probability of success;

b. Irreparable damage; and

c. Balance of convenience.

The court in the case of Mrao Ltd –vs- First American Bank of Kenya Ltd(2008) eKLR defined what constitutes a Prima facie case as follows;-

“ APrima faciecase 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 trail. 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 later…”

Looking at this Principle in light of the material placed before us, it is apparent, that the Claimant does not dispute that he owes the Respondent. What he appears to contest is the mode of calculation of the said loan. According to him, the Respondent has been varying figures even when he had made efforts to offset the outstanding amount.

Secondly, the Claimant contend that he was not given the mandatory three (3) months Notice before the property was advertised for sale.

Thirdly, the Claimant avers that the loan period had not accrued since the due date for the loan is June, 2020. According to him, it is us premature for the Respondent to advertise his property for sale.

We have perused the loan statement produced by the Claimant in his Supporting Affidavit. It is apparent that he has not been consistent in making the monthly repayments. He was supposed to be remitting a sum of Ksh. 51,847/- per month. In the month ending 30/1/2015 for instance, he made a deposit of Ksh. 72,000. 00 . He subsequently stopped making any remittances until June, 2015 when he made a lumpsum payment of Ksh. 180,000. It therefore means that he did not make any repayment for the months of February, March, April and May, 2015. Cumulatively, he owed the Respondent a sum of Ksh. 207,388. The scenario has been the same in subsequent months. As per the said loan statement, the outstanding loan as at 19/5/18 was Ksh. 2,073,613. 40.

Thus in term of the outstanding loan, it is apparent that the Claimant still owes the Respondent.

As regards to the Notice period, the Claimant has not led evidence to demonstrate that he was entitled to a Notice of three (3) months.

As regards the maturity date for the loan, whilst the Claimant contend that the same is on June, 2020, he has not told the Tribunal about what happens in the event of default.

The Long and short of the foregoing is that the only valid concern raised by the Claimant which needs interrogation is the exact amount due and owing. It is apparent that there is no consensus on the exact figure. This alone, does not satisfy the 1st limb of the Principles enunciated in the Giella –vs-Cassman Browns case - the Prima facie case thus leading us to the 2nd Principle, irreparable loss.

What is at stake here is the suit property. If it is sold and after the hearing of the claim, we find that the Claimant owed the Respondent a lesser amount, then the Claimant will have suffered irreparable loss.

As regards the third limb balance of convenience, we take the view that the same will till towards granting the Injunction so as to preserve the subject matter of the suit.

Conclusion

The upshot if the foregoing is that we find merit in the Application and allow it in term of prayer 3 and the following condition;-

a. The Claimant to meet the auctioneers costs as well as advertisement fees;

b. Parties to agree on the said costs failure to which the same will be taxed; and

c. Parties to comply with order 11 and process the main claim for hearing.

Ruling Read, dated and delivered via email in line with the direction issued by the Honourable, the Chief Justice on 15/3/2020, this 30th day of April, 2020.

Prepared by Hon. B. Kimemia – Chairman, Hon. F. Terer – Deputy Chairman and P. Gichuki – Member.

With the consent of the parties and the final orders to be delivered by email in accordance to the prevailing measures during the COVID-19.

Hon. B. Kimemia ………………….

Chairman

Hon. F. Terer …………………..

Deputy Chairman

P. Gichuki …………………

Member