[2025] KECPT 172 (KLR)

Lodeki v Kenya Union of Savings and Credit Co-operatives Limited (Tribunal Case E014 of 2024) [2025] KECPT 172 (KLR) (27 February 2025) (Ruling)

Neutral citation: [2025] KECPT 172 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case E014 of 2024

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

February 27, 2025

Between

Wilson Lodeki

Claimant

and

Kenya Union of Savings and Credit Co-operatives Limited

Respondent

Ruling

1. This ruling dispenses the Notice of Motion Application dated 16th September 2024. The Application is supported by an Affidavit sworn by the Applicant Wilson Lodeki Amukullah and brought under Section 1A & 1B, 3 &3A, The Civil Procedure Act and Order 40 of the Civil Procedure Rules. The Application seeks the following orders:a.Spentb.That this Honourable Court be pleased to issue a temporary injunction restraining the Respondent from advertising for sale, selling by private treaty or public auction land parcel number Sinyerere/Sitatunga Block 5/Makunga/52 pending hearing and determination of this matter.c.That pending interparties hearing this honorable court be pleased to issue a temporary injunction restraining the Respondent, its servants and/or agents from advertising for sale, selling by private treaty or public auction land parcel number Sinyerere/Sitatunga Block 5/Makunga/52. d.Costs be provided for.

2. The Application is premised on the grounds on its face which are inter alia that: The Applicant was advanced a loan by the Respondent in 2014. The Applicant was prevented by circumstances beyond his control to repay the instalments are agreed. That the Respondent is likely to dispose of the Claimant/Applicant’s matrimonial home and render him homeless with his family.

3. The Respondents, in their submissions, submitted that application should be dismissed as this court has no jurisdiction to hear the matter. Further, that the Applicant has failed to establish a prima facie case.

Analysis 4. This Tribunal has noted the application, response and the submissions with regards to this application. The question before this Tribunal is whether the Applicant is entitled to the reliefs sought, to wit, a temporary injunction retraining the Respondents from advertising for sale, selling by private treaty or public action land parcel number Sinyerere/Sitatunga Block 5/Makunga/52 pending hearing and determination of this matter.

5. Before we dwell on the issue of inunction, this court deems fit to settle first the issue of jurisdiction. Jurisdiction is everything, without which this Tribunal will down its tools. The Respondents have raised the issue that this Tribunal has no jurisdiction pursuant to Section 77 of Co-operative Societies Act. They assert that the Claimant is not a member of the Respondent, and therefore this Tribunal has no jurisdiction. The Claimant is a member of a primary society called Trans-Nzoia Times Sacco. According to the Respondents, the Respondent created a department called KUSCCO Housing Co-operative Society which would provide mortgage financing to individual members of primary societies, and that the correct respondent would have been the KUSCCO Housing Co-operative Society.

6. This Tribunal notes that the Respondent is an apex society whose membership is drawn from primary societies. We also note that for one to qualify for the mortgage facility they had to be a member of a primary society which is a member of the Respondent. We feel that the Respondent, being an apex society, held itself out to the members of primary societies as being in a position to carry out cooperative business that would be carried out by the individual primary societies to its members. The Respondent, after holding out, and engaging with members of its primary societies, cannot now turn and deny that it was not engaging with individual members of primary societies for those things that would ordinarily fall under the primary societies. The Respondent cannot also claim that the right respondent is the KUSCCO Housing Co-operative Society, while he has admittedly said that the housing unit was a department within the Respondent. The Chargees statutory notice is indeed said to be from the Respondent and not the housing unit. We therefore, feel that the Respondent has been rightly sued and that we are seized of jurisdiction to handle the matter.

7. On the second issue of an injunction, the germane principles on interlocutory injunctions were stated by the Court of Appeal in East Africa in the case of Giella v Cassman Brown & Co. Ltd (1973) EA as follows:a)The Applicant must first establish a prima facie case with a probability of success.b)The Applicant must then demonstrate that he, she or it stands to suffer irreparable loss that cannot be adequately compensated through damages.c)Where there is doubt on the above, then the balance of convenience should tilt in favour of the Applicant.

8. The first question that this tribunal should address itself is whether the claimant has established a prima facie case with a probability of success. In the case of Mrao v First American Bank of Kenya Limited & 2 others [2003] eKLR the court defined a prima facie case as one which on the material presented in court, a tribunal property directing itself will conclude that there exists a right which has apparently been infringed by the opposite party as to call for an explanation or rebuttal from the Respondent.

9. And so, in this case, the Applicant ought to show that the act of advertising for sale, selling by private treaty or public action land parcel number Sinyerere/Sitatunga Block 5/Makunga/52 will infringe on a right that the applicant has. We ask ourselves why is the Respondent threatening to sell the Claimant’s property? The reason is that the Applicant offered his property as a security for a loan from the Respondent. A security is normally given to secure the payment of a debt in case of default. The Applicant himself admitted that he has defaulted in the amount advanced, reason why he has come to this court to seek protection. We, therefore, find that a prima facie case has not been established in this case.

10. The second element that ought to be established is that the Respondent stands to suffer irreparable loss that cannot be compensated by an award of damages if the injunction. The Applicant has informed this court that the Respondents are threatening to sell the security which comprises of his matrimonial home. Indeed, there is a Chargees statutory notice on record. The question before us, therefore, is whether the loss of a matrimonial home is something that can be compensated by way of damages.

11. In the case of Hannington Onyango Osodo & another v Housing Finance Company of Kenya Limited & another [2021] eKLR, the court held that“……..The Applicants submit that they will suffer irreparable damage and the loss of their matrimonial home known as LR No 12778/202 Nairobi cannot be compensated by an award of damages. The suit property is the Applicants’ home and no amount of money can compensate this……”. We identify with this decision of the court that despite the hardship that will be occasioned to the family being driven out of their home, there is some sentimental value that is attached to a matrimonial home.

12. On the balance of convenience, the court in Chebii Kipkoech v Barnabas Tuitoek Bargoria & another [2019] eKLR, where it was held that:“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 them would be greater than that caused to the defendants if an injunction is granted and suit is ultimately dismissed.”

13. If an injunction is granted, and the Claimants lose the case, the Respondents can still sell the property and recover their money. There is also an assumption that the defaulted amounts continue to an interest. If an injunction is not granted and the Claimants win the case, they will have lost their home. The balance of convenience, thus, lie with the Claimants.

14. In the upshot we find merit in the Applicant’s Notice of Motion dated 16th September 2024 and make the following ordersa.Pending the determination of this Claim, temporary injunction is hereby issued retraining the Respondents from advertising for sale, selling by private treaty or public action land parcel number Sinyerere/Sitatunga Block 5/52 pending hearing and determination of this matter.b.The costs of this Application to be in the cause.c.Parties to comply by filing witness statement and documents within 21 days herein.

RULING SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 27TH DAY OF FEBRUARY, 2025. HON. B. KIMEMIA CHAIRPERSON SIGNED 27. 2.2025HON. J. MWATSAMA DEPUTY CHAIRPERSON SIGNED 27. 2.2025HON. BEATRICE SAWE MEMBER SIGNED 27. 2.2025HON. FRIDAH LOTUIYA MEMBER SIGNED 27. 2.2025HON. PHILIP GICHUKI MEMBER SIGNED 27. 2.2025HON. MICHAEL CHESIKAW MEMBER SIGNED 27. 2.2025HON. PAUL AOL MEMBER SIGNED 27. 2.2025TRIBUNAL CLERK MUTAIMiano advocate for RespondentNo appearance for ClaimantMiano advocate – We have spoken and we are likely to reach a settlement. I pray for 30 days. I pray for ruling and proceedings.Mention on 27. 3.2025. Notice to issue.HON. B. KIMEMIA CHAIRPERSON SIGNED 27. 2.2025