[2024] KECPT 1720 (KLR)

Kikuyu Dairy Farmers Cooperative Society Limited v Kung'u (Tribunal Case 354 (E158) of 2021) [2024] KECPT 1720 (KLR) (3 October 2024) (Judgment)

Neutral citation: [2024] KECPT 1720 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case 354 (E158) of 2021

BM Kimemia, Chair, Janet Mwatsama, Vice Chair, B Sawe, F Lotuiya, P. Gichuki, M Chesikaw & PO Aol, Members

October 3, 2024

Between

Kikuyu Dairy Farmers Cooperative Society Limited

Claimant

and

David Kiangonyo Kung'u

Respondent

Judgment

1. The Claimant’s case is based on the following:i.Statement of Claim of 12/8/2021ii.Witness Statement of 12/8/2021iii.Claimants Documents of 12/8/2021iv.Hearing Proceedings of 24/1/2024v.Written Submissions of 6/5/2024 among other documents.In its Statement of Claim, the Claimant states that it is a registered Co-operative that buys milk in Kikuyu Sub-County and its environs.The Claimant states that it has acquired properties including the Maziwa Housing. The Claimant avers that the Respondent is a former member and also a former Chairman of the Respondent from November, 2014 to February, 2016.

2. The Claimant states that the Respondent was suspended from the Respondent after becoming a nuisance during the Annual General Meeting of 6/10/2017. The claimant states that the Respondent has continued to be a thorn in the flesh of the activities of the Claimant despite being expelled. Specifically, the Claimant states that the Respondent on 28/7/2021 changed the Rocks of the main gate of Maziwa House and issued tenant with a letter dated 28/7/2021 instructing the tenants of new rent account.The Claimant avers that the Respondent’s actions were malicious and misleading since the Maziwa house is owned by the Claimant. The Claimant states that it reported the above incident to the police and no action was taken against the Respondent.

3. In its Witness Statement dated 12/8/2021, the Claimants states that as per the Statement of Claim, the Respondent’s actions may lead loss, panic and disturbance to the tenants of the Maziwa house. The Claimant further states that the actions of the Respondent and subsequent Communications on Maziwa House are intended to defraud the Claimant.The Claimant has filed various documents to support its case. The documents are contained in bundle dated 12/8/2021 and include but not limited to the following;i.Title No. Dagoretti/Thogoto 4084ii.Lease Certificate for Dagoretti Uthiru and Kiambu/Kikuyu trading centre.iii.Minutes of 6/10/2017

4. During the hearing of the case on 24/1/2024, the Claimant’s Witness Mr. David Kirobi who is the Vice Chair of the Claimant adopted his 12/8/2021 Statement and adopted his documents of 12/8/2021 as his evidence in chief. He stated that the Claimant Co-operative pays dividends.

5. On Cross-examination by the Respondent, he admitted he was in the Annual General Meeting that suspended the Respondent. He averred that about 300 members attended. He admitted that there was evidence to this attendance. He admitted that he was a Vice Chair and represented Maziwa House as member no. 2022. He admitted that the last Annual General Meeting of Maziwa House was conducted jointly with the Dairy Cooperative. He stated that the Maziwa House had about 100 members and that the house pays dividends. He claimed that the Respondent stole Kshs. 250,000/= and the matter was reported to the police. He avers that he was ready to fight corruption.He stated that he was still the Chair of the Claimant. On re-examination, the Witness Stated that the Maziwa House belongs to Kikuyu Dairy Cooperative.On clarification, the Claimant Witness Stated that the Respondent was paid dividends and that the Respondent owed the Claimant Kshs. 250,000/=. He averred that the Maziwa House is owned by the Claimant. The witness stated that the Respondent was expected from the Claimant Cooperative and Maziwa House.The Witness averred that the Respondent’s shares are held in abeyance until he repays Kshs. 250,000/=.In its Claimant’s Written Submissions, the Claimant narrates the jest off the case. The Claimant averred that the Respondent after being voted out from the leadership of the Claimant Cooperative started inciting members against the Claimant by organizing a group of dormant members with a view to destabilize the Claimant.He states that the Respondent was expelled during the Claimed Annual General Meeting of 6/10/2017. Despite the expulsion, the Respondent continued to propagate disruptive activities by visiting the Claimant offices and using abusive language against the employees of the Claimant.The Claimant avers that the Respondent was illegally selling trees owned by the Claimant on Dagoretti/Thogoto/4084. He avers that the Respondent changed the gate rock of Dagoretti/Uthiru/451/45 house and threatened the tenants. The Claimant avers that the Respondent has admitted existence of a group of former members. The Claimant states that allegations by the Respondent did.

6. The Claimant in his Witness Statement by the Vice Chair Mr. David Ngugi Kirobi dated 12/8/2021, stated that the Claimant has acquired properties in form of plots, including Maziwa House where its offices are located.He states that the Respondent is a former Chairman from 2014 to 2016 and was expelled on 6/10/2017 for being a nuisance to the Cooperative.He states that despite the expulsion, the Respondent has continued to incite members against the elected officials. He states that communications from the Respondent to the dormant members are malicious and misleading.

Respondent’s Case.The Respondent’s case is based on the following;i.Respondent’s Response dated 25/8/2021. ii.List of Documents dated 7/9/2022. iii.Replying affidavit dated 7/9/2022(8/12/2022)iv.Status report of 7/9/2022v.Hearing on 24/1/2024. vi.Submissions dated 27/5/2024. 7. In the Respondent’s response, the Respondent states that he joined the Claimant Cooperative in 1993 as member number 1539. He stated that he used to deliver milk to the Claimant Cooperative until 2016 when the Claimant stopped him.He states that the meeting that removed him on 23/11/2016 was illegal and was not sanctioned by members of the Cooperative.He challenged the description of members as ‘dormant’ stating that such members were owed 3 months milk delivery.He avers that the so called dormant members do not deliver milk to the Claimant for various reasons but they are investors in Dagoretti plot no 4084 and Maziwa House.He states that between 1994 to 1998, the then members of the Claimant raised fund through shares to buy Dagoretti Plot 4084 and build a milk processor Kshs. 4,700,000/= was raised.

8. The Respondent states that Kshs. 1,600,000/= was used to buy land but remainder of Kshs. 3,100,000/= was not accounted for.The Respondent avers that the land belongs to members and that the Claimant is only a trustee.He denies ever interfering with Dagoretti plot 4084 but states it is the Claimant who sells trees and collects rent on the plot, so far Kshs. 600,000/= which has not been accounted for.He stated Maziwa house was bought by members of the Claimant and that the house generated about Kshs. 1,000,000/= per month but members don’t get dividends.He avers that the dormant members are not invited to the Annual General Meetings. He further avers that the 2019 dormant members held a meeting on 14/8/2010 where they decided to seek a court order to stop a following Annual General Meeting and use other means to reclaim the properties and put a caveat on plot 4084 and Claimants bank accounts. The Respondent avers that he was mandated to pursue the interest of the dormant members.

9. The Respondent avers that despite the Court orders, the Claimant went ahead with the Annual General Meetings slated for 30/10/2020. He states that the Claimant has refused dialogue.The Respondent has filed the following documents among others in support of his Defence vide his letter of 7/9/2022;i.Service suspension letter dated 19/4/2016. ii.Minutes of Special General Meetings of plot and Maziwa House shareholders of 23/1/2021. iii.Letters to the County director of Cooperatives.

10. During the hearing of the case on 24/1/2024, the Respondent witness Mr. David Kung’u adopted his Statement/Affidavit dated 8/12/2022 as his evidence in chief.He stated that he was a member of the Claimant Cooperative and a shareholder of both Cooperative and the house.He stated that he wrote a Response to the Claim on 25/8/2021 and a status report on 7/9/2022. He averred that he has not received dividends since 2017. He averred that he was the Chairman of the house in 2015 but voted out in 2016. He stated that he was not delivering milk to the Cooperative and requested Court for sympathy. He states that he was not paid for milk delivered and challenged the Claimant to quantify trespass costs.

11. On Cross-examination, the Respondent denied trespassing to the Claimant’s property. He admitted writing letters on behalf of the 2079 dormant members.He averred that even the dormant members are contributors to the Cooperative. He admitted locking the doors of Maziwa House.He stated that the Cooperative land belonged to the members and not the Claimant, who was just a trustee.He admitted that the Claimant can collect rent. On being asked why he wrote to the tenants regarding rent, he stated that it was because Maziwa House members had not been called for a meeting.He stated that they are requesting own Cooperative and that he had no Counter-claim. He admitted that he had no authority to represent the dormant members.The court had on 24/1/2024 directed parties to file Written Submissions.

12. In his Reply to the Claimant’s Submissions dated 27/5/2024, the Respondent denies being a nuisance and thorny to the Claimant averring that he was just fighting for his rights and those of the dormant members.He states that his expulsion intended to keep him off from the business of the Claimant especially the business of Maziwa house.He avers that the Claimant is not the rightful owner of Maziwa house.He avers that the Supreme authority of the Claimant should be given a chance to decide on by-laws and regulations governing the Cooperative.The Claimant has moved this Court to determine the following;i.Whether the Claimant is the rightful owner of Maziwa House.ii.Whether the actions of the Respondent amount trespass.iii.Whether the Claimant is entitled to damages.

13. As regards the ownership of Maziwa House, the Claimant has filed documents to prove that the house is owned by the Claimant. In the Claimant’s bundle of documents dated 12/8/2021, the Claimant has filed sufficient evidence to prove that the land properties are owned by the Claimant.The Respondent has alluded to this position during the hearing of the case during Cross-examination.

14. In a Cooperative Society scenario, properties like land and buildings are owned by the Cooperative either through direct procurement or through members’ contribution.In this case, no evidence has been adduced to shou that the properties are not owned by the Claimant.As regards trespass by the Respondent, this has been admitted by the Respondent during the hearing in the Cross examination.The Respondent admitted that he locked two doors of the Cooperative house but denies this being a trespass. The Respondent during cross examination admitted opening a Bank Account for the Maziwa House stating that there was authority of House Annual General Meeting but which minutes were not filed.

15. On whether the Claimant is entitled to damages, the Claimant has prayed for nominal damages of Kshs. 200,000/= without any proof.He however note that the Respondent has admitted trespassing into the Claimant properties and closing the doors to a business premise, this action alone is tantamount to trespass since the Respondent was not an official of the Claimant Cooperative.It is the admission of the Respondent that he was not an official of the Claimant hence did not have power to change the locks of Maziwa House and interfere with the tenants of the house.There are better ways of resolving management disputes in Cooperatives. The action of the Respondent was uncalled for.

Conclusion. 16. We find that the Claimant has proved that it is the rightful owner of the suit house, Maziwa House.We also find that the Respondent has admitted that he changed the locks of Maziwa House when he was not authorized to do so. while denying that this action was a trespass.We are of the opinion that the Claimant is entitled to damages as the Respondent actions could have occasioned a disruption of business in Maziwa House.We observe that the Respondent has not challenged the Kshs. 200,000/= damages requested by the Claimant in the Claimant Written Submissions.We pass judgement in favor of the Claimant against the Respondent as follows:a.Damages for trespass of Kshs. 100,000/=b.A Permanent Injunction against the Respondent, his servants, agents or employees from interfering whatsoever with the properties known as Kiambu/Kikuyu trading centre/53, Dagoretti/Uthiru/521/25 and Dagoretti/Thogoto/4084. c.Cost of suit plus interest at Court rates.

JUDGMENT SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 3RD DAY OF OCTOBER, 2024. HON. B. KIMEMIA CHAIRPERSON SIGNED 3. 10. 2024HON. J. MWATSAMA DEPUTY CHAIRPERSON SIGNED 3. 10. 2024HON. BEATRICE SAWE MEMBER SIGNED 3. 10. 2024HON. FRIDAH LOTUIYA MEMBER SIGNED 3. 10. 2024HON. PHILIP GICHUKI MEMBER SIGNED 3. 10. 2024HON. MICHAEL CHESIKAW MEMBER SIGNED 3. 10. 2024HON. PAUL AOL MEMBER SIGNED 3. 10. 2024Tribunal Clerk MutaiMitambo advocate holding brief for Mr. Karuga advocate for the ClaimantDavid Kiangonyo Kungu- No appearanceHON. J. MWATSAMA DEPUTY CHAIRPERSON SIGNED 3. 10. 2024