[2021] KECPT 525 (KLR)

REPUBLIC OF KENYA

IN THE CO-OPERATIVE TRIBUNAL AT NAIROBI

TRIBUNAL CASE NO.387 OF 2020

MUKI SACCO SOCIETY LIMITED.............................................CLAIMANT

VERSUS

DAVID KIMUTAI NGETICH..................................................RESPONDENT

AND

OJIAMBO & COMPANY ADVOCATES...................................GARNISHEE

RULING

Vide the Application dated 20. 5.2020, the Respondent has moved this Tribunal seeking for the following Orders:

1. That there be stay of execution pending the hearing and determination of this Application;

2. That this Honourable Tribunal be pleased to set aside the ex-parte proceedings herein, the judgment entered on 25. 9.2018 and the decree herein dated 4. 11. 2019;

3. That the Respondent/Applicant be granted leave to file defence to the statement of claim and defend this suit;

4. That Defence filed herein be deemed proper and duly filed; and

5. That the costs of this Application be provided for.

The Application is supported by the grounds on its face the Supporting Affidavit sworn on even date and the Further Affidavit sworn on 13. 10. 2020.

The Claimant has opposed the Application vide the Replying Affidavit sworn by Violet Wanjiru Ndung’u on 8. 9.2020.

Vide the directions given on 6. 8.2020, the Application was canvassed by way of written submissions. The Respondent filed his written submissions on 16. 10. 2020 while the Claimant did so on 17. 12. 2020.

Respondent’s Contention

Vide the instant Application, the Respondent contend that whilst he received pleadings in the matter in November, 2018, he did not enter Appearance or file a Defence as the court file was not readily available at the registry whenever he attempted to do so. That the issues raised in the instant Application have been the subject of Nakuru ELRC NO. 48 OF 2017 and that the court in that case has made a final determination.

Vide his supporting Affidavit sworn on even date(20. 5.2020) the Respondent avers that he received summons to enter Appearance to the exclusion of pleadings around November 2018. That he later shared a copy of the summons with his lawyer in June, 2019. That upon receipt of the summons, the lawyer tried tracing the court file to no avail.

Claimant’s Contention

Vide the Replying Affidavit sworn by Violet Wanjiru Ndungu on 8. 9.2020, the Claimant has opposed the Application on grounds that the Respondent was duly served with summons to enter Appearance on 3. 12. 2018. That after 7 months that is, on 17. 6.2019, he entered appearance and again failed to file a Defence until 25. 9.2019 when summary judgment was entered. That again, it has taken him over one (1) year to file the instant Application.

That as regards the assertion that the court file was missing, the Respondent has not led evidence to confirm this fact.

That proceedings in ELRC NO.49/19 related to unemployment dispute between the Claimant and the Respondent. That the Respondent has not demonstrated that he has a good Defence for the following reasons:

a. That the Respondent for applied and obtained various loans from the Claimant;

b. That he has not stated whether or not he repaid the said loans;

c. That he has not given any proposal on repayment of the said loans.

Issues for determination

The instant Application has presented the following issues for determination.

a. Whether the Respondent has laid a proper basis to warrant the setting aside of the default judgment entered in 25. 9.2019;

b. Who should meet the costs of the Application?

Setting aside of default Judgment

We have jurisdiction to set aside a default judgment by dint of Order 10 Rule 11 of the Civil Procedure Rules. The Rule provides thus:

“ Where judgment has been entered under this Order, the court may set aside or vary such judgment and any consequential Decree or Order upon such terms as are just.”

In the case of Patel – vs- East Africa Cargo Service Limited (1974)EA 75, the Court underscored this provision in the following terms:

“ The main concern of the court is to do justice to the parties and the court will not impose conditions on itself to fetter the wide discretion given to it by the Rules.”

Before we can exercise our jurisdiction under Order 10 Rule 11 above, we firstly have to ascertain whether the default judgment is a regular or irregular one. If the Judgment is an irregular one, then we will set it aside ex debito justiciae.

This was the holding in the case of K- Rep Bank Limited -vs- Segment Distributors Limited [2017] eKLR.

The court in the case of Fidelity Commercial Bank Limited – vs- Owen Amos Ndungu & Another, HCC.NO. 241/1998 gave a distinction between a regular and irregular judgment as follows:

“ A distinction is drawn between regular and irregular judgments. Where summons to enter Appearance has been served and there is default in entry of Appearance the ex parte judgment entered in default is regular. But where the exparte judgment sought to be set aside is obtained either because there was no proper service or any service at all, of the summons to enter Appearance, such judgment is irregular and the affected Defendant is entitled to have it set aside as of right”

Where the default judgment is regular, then the Tribunal has to consider if the draft Defence filed with the Application raises triable issues. This was the holding in the case of James Kanyiita Nderitu & Another - vs- Marios Philotas Ghikes & Another [2016]eKLR. In the pertinent part, the court held thus:

“ In a regular default judgment, the Defendant will have been duly served with summons to enter appearance, but for one reason or another, he failed to enter appearance or to file a Defence, resulting in default judgment. Such a Defendant is entitled under Order 10 Rule 11 of the Civil Procedure Rules to move to court to set aside the default judgment and to grant him leave to defend the suit. In such a scenario, the court has unfettered discretion in determining whether or not to set aside the default judgment and will take into account such factors as to the reason as for the failure of the Defendant to file his memorandum of Appearance, or defence, as the case may be, the length of time that has elapsed since the default judgment was entered; whether the intended Defence raises triable issues, the respective prejudice each party is likely to suffer whether on the whole, it is in the interests of justice to set aside the default judgment.”

Reasons for failure to file a Defence

The main reason why the Respondent did not file a Defence is that he was only served with summons to enter Appearance to the exclusion of other pleadings. That when he wanted to obtain copies of the said documents from the court file, the same was missing.

We have perused the record and note that there is nothing to show that the Respondent brought to the attention of the Tribunal the fact that the Tribunal file was missing.

Further, it is instructive to note that the Claimant has a lawyer on record with a known address. The Respondent has not stated whether he tried to obtain copies of the said pleadings from cases on record for the Claimant.

In totality of the foregoing is that the Respondent has not given a plausible reason as to justify failure to file a Defence within the time limited by the Rules.

Draft Defence

The claim herein is for recovery of loan arrears. We have perused the Respondent’s draft statement of Response. He confirms having taken the loan from the Claimant on diverse dates. He avers that his contract with the Claimant was terminated in the year 2016 and that the subject of the pending loans was subject to proceedings in ELRC NO. 49/2017. That he repaid the loan within the contractual period and that the said period has not expired.

What we gather from the said draft Response is that the Respondent does not deny taking the loan. He does not also deny the fact that he is in arrears. We thus do not find any issue worth trying if we were to admit the claim for hearing. In simple terms, we are saying that the draft statement of Response does not raise any triable issue.

Conclusion

The upshot of the foregoing is that we do not find merit in the Respondent’s Application dated 20. 5.2020 and hereby dismiss it with costs to the Claimant.

Ruling signed, dated and delivered virtually this 7th day of January, 2021.

Hon. F. Terer Deputy Chairman Signed 7. 1.2021

Mr. P. Gichuki Member Signed 7. 1.2021

Mr. B. Akusala Member Signed 7. 1.2021