[2024] KECPT 1504 (KLR)

Munyui & 7 others v Chai Housing Co-operative Savings & Credit Society Limited (Tribunal Case 250 of 2019) [2024] KECPT 1504 (KLR) (26 September 2024) (Judgment)

Neutral citation: [2024] KECPT 1504 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case 250 of 2019

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

September 26, 2024

Between

Kennedy Josephat Munyui

1st Claimant

Grace Wanjiru Muniu

2nd Claimant

Grace Nduta

3rd Claimant

Leonard Munyui

4th Claimant

Mary Wambui Munyui

5th Claimant

Rachael M Munyui

6th Claimant

Antony Kamau

7th Claimant

Kellen Nyambura

8th Claimant

and

Chai Housing Co-operative Savings & Credit Society Limited

Respondent

Judgment

1. The matter for determination is a Statement of Claim dated 14th May 2019. In the Statement of Claim, the Claimants claim that they were all members of the Respondent. That the Respondent offered and the Claimants accepted to purchase plots of land. The Claimants claim that they paid money to purchase the plots, and to date, they have not been given the plots, or their money back The Claimants are aggrieved and pray for :a.1st Claimant Kshs. 1,006,600/=2nd Claimant Kshs. 406,600/=3rd Claimant Kshs. 516,600/=4th Claimant Kshs. 506,600/=5th Claimant Kshs. 1,006,600/=6th Claimant Kshs. 1,345,600/=7th Claimant Kshs. 100,000/=8th Claimant Kshs. 600,000/= with interest at the rate of 25% per annum from the date of payment until payment in full.b.Damages and mesne profitsc.Costs with interest thereon at court rates.d.Any other relief that this Honurable Tribunal may deem fit to grant.The Claimants filed Witness Statements and a List of Documents in support of their claim.

2. The Respondent entered appearance and filed a Statement of Defence dated 28th June 2019 and filed on 2nd July 2019. In their response, the Respondents stated that there was no letter of offer from the Respondents to the Claimants that permitted the Claimants to commence any payments, and neither did they receive any monies from the Claimants. The respondents contend that there were notices they had put up that absolutely no cash payments were to be paid to the office.

3. During the hearing, the 7th Respondent and one Mercy Wanjiku Muniu testified on behalf of all other claimants. During cross-examination, the 7th Respondent responded that he was not a member of the Respondent and that he does not attend Annual General Meetings. On inquiry, whether the other Claimants are members, the witnesses responded that they live outside the country. The second witness testified that the Claimants were her brothers and sisters and she was the one sent to look at the land, and also sent for the money to pay for the land.

Analysis 4. The question before this Tribunal is whether the Claimants are entitled to the relief sought. The Claimants’ claim is for a refund of the monies paid to the Respondent for the purchase of parcels of land that they were never given.

5. In answering that question, this court has to determine the issues that were raised by the parties by considering the evidence of the parties and the documents submitted.

6. According to the Respondents, the Claimants are not and have never been members of the Respondents. The 7th Claimant in his testimony testified that he has never been a member of the Respondent. Indeed, from the copies of receipts submitted, there is no indication that he ever paid for membership. What is left for this court to determine is the 1st to 6th and 8th Respondents. The Claimants claim they were members of the Respondents. Section 2 of the Co-operative Societies Act defines a member as follows;“member” includes a person or a co-operative society joining in the application for the registration of a society, and a person or co-operative society admitted to membership after registration in accordance with the by-laws;

7. The above provision of the law provides the need for an application for registration of a society, and admission to membership by the society in accordance to its by-laws. In this matter, Claimants 1-6 have produced copies of receipts that show that they paid an entrance fee of Ksh. 2000/- each, admin fee of Ksh. 3600/- and institutional capital of Ksh. 1,000/=. We are inclined to believe that they were admitted as members. The 8th Claimant did not produce any document that indicates that he paid any entrance fee. We are inclined to give a benefit of doubt to the 1st to 6th Claimants that they were members of the Respondent.

8. On the question of whether Claimants 1-6 indeed made deposits for the purchase of parcels of land claimed, and whether they are entitled to a refund. The Claimants produced documents they claimed were given after they paid the purchase price in cash. The receipts bear the stamps of the Respondent. According to the Respondents, the Claimants did not produce any letter of offer from the Respondent for them to start paying for the plots and that there was no contract between the parties. The Respondents also claim that they have never issued any receipts to the Claimants and if the Claimants indeed paid the money they were negligent, as there were notices against making cash payments.

9. The Respondents, during the hearing, intimated that the receipts produced looked like their receipts, but the numbers show that they do not have the receipt book. They also testified that they do not know where Gerald and Michael got the receipts. The Claimants during the hearing, testified that they did not know that the Respondents did not accept cash, and that the people who received the money and took them to the field were people called Gerand and Michael.

10. From the above, it is not in dispute that the Respondents had employees called Gerald and Michael. Gerald and Michael were not called to give evidence and therefore, there is a grey area on whether the two received money meant for the plots. What is there for making a determination are documents produced by both the Respondents and Claimants. The Claimants had nothing to say about the Respondent’s documents because these are internal documents that the Respondent and any other outsider for that matter is not expected to know the contents. This court is hereby left with the Documents produced by the Claimants. The Respondents avered in their evidence that the documents looked like their documents. The Respondents did not also produce bank statements that show that indeed there was no money banked by the accountants around the period in question. We are inclined to ]believe that the Claimants indeed paid money to the Respondents for the purchase of parcels of land. The Respondent was and is responsible for their internal controls, and it cannot be a defence that the system might have been weak. If the Claimants believed that the Respondents were indeed selling parcels of land and they paid money on that believe, and they got receipts for the same, then this court will believe them.

11. On the 7th and 8th Claimant, this court has found that they have not demonstrated that they were members of the Respondent. The Jurisdiction of this Tribunal is very clear under section 76 of the Cooperative Societies Act which provides as followsDisputes1. If any dispute concerning the business of a co-operative society arises:— (a) among members, past members and persons claiming through members, past members and deceased members; or (b) between members, past members or deceased members, and the society, its Committee or any officer of the society; or (c) between the society and any other co-operative Society; it shall be referred to the Tribunal.

12. From the above, it is clear that the jurisdiction of this Tribunal with regards to natural persons is limited to persons who are or were members of a cooperative society and the cooperative society.a.The Upshot is that we find the Claimants’ Claim dated 14. 5.2024 partly merited and make the following orders:b.The 7th and the 8th Claimant’s claim is hereby dismissed for want of jurisdiction, with no orders as to costs.c.The 1st, 2nd, 3rd, 4th, 5th and 6th Claimants’ claims are meritedd.The Respondent is hereby ordered to refund the 1st, 2nd, 3rd, 4th, 5th and 6th Claimants’ contribution with interests at court rates from the date of filing suite.Prayer for damages fails as the same was not provedf.1st, 2nd, 3rd, 4th, 5th and 6th Claimants’ are awarded costs of the Claim.

JUDGMENT SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 26TH DAY OF SEPTEMBER, 2024. Hon. B. Kimemia Chairperson Signed 26. 9.2024Hon. J. Mwatsama Deputy Chairperson Signed 26. 9.2024Hon. Beatrice Sawe Member Signed 26. 9.2024Hon. Fridah Lotuiya Member Signed 26. 9.2024Hon. Philip Gichuki Member Signed 26. 9.2024Hon. Michael Chesikaw Member Signed 26. 9.2024Hon. Paul Aol Member Signed 26. 9.2024Tribunal Clerk JemimahNo appearance by parties.Judgment delivered in absence of of parties.Hon. J. Mwatsama Deputy Chairperson Signed 26. 9.2024