[2021] KECPT 595 (KLR)

Mutisya & 5 others v Munala & 2 others (Tribunal Case 742 of 2019) [2021] KECPT 595 (KLR) (4 March 2021) (Ruling)

James Mutisya & 5 others v Alphayo Chimwanga Munala & 2 others [2021] eKLR

Neutral citation: [2021] KECPT 595 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case 742 of 2019

BM Kimemia, Chair, P. Gichuki & B. Akusala, Members

March 4, 2021

Between

James Mutisya & 5 others

Claimant

and

Alphayo Chimwanga Munala

1st Respondent

Terence Bavon Minishi

2nd Respondent

Hazina Sacco Society

3rd Respondent

Ruling

1. Vide the directions given on 20. 1.2020, both the Application are the Preliminary Objection are to be determined together. Further, and as per the directions given on 3. 3.2020, the Preliminary Objection and the Applications were to be canvassed by way of written submissions. The 3rd Respondent filed its written submissions on 22. 7.2020 while the Claimant did so on 11. 11. 2020.

2. For procedural correctness, we will firstly dispose of the 3rd Respondent’s Application dated 23. 1.2020 alongside its Notice of Preliminary Objection dated 20. 1.2020.

3. 3rd Respondent’s Application dated 23. 1.2020 and the Preliminary Objection dated 20. 1.2020.

4. Both the Application and the Preliminary Objection speak to one thing; the Tribunal jurisdiction to entertain the claim. It is the 3rd Respondent’s case that this Tribunal is not seized of the requisite jurisdiction to entertain the claim as it is as the same is sub-judice Criminal Case No. 2066 of 2018 pending at the City Court in Nairobi.

5. It is the 3rd Respondent’s case that in the instant claim, the Claimants are challenging the enforcement of their alleged guarantees to the 1st and 2nd Respondent’s whilst at the same time, they are contesting the said guarantee’s in criminal proceedings at the City Court.

6. The Claimants have opposed the Application vide the Replying Affidavit sworn by the 5th Respondent Peter Kanyi on 2. 3.2020 vide the said response, the Claimant aver that the instant claim and Criminal Case No. 2066/2018 pending at the City Court are two distinct proceedings as one of them is a Criminal Case while the claim herein is a civil claim. That there is no other pending civil proceedings between the parties and emanating from the same subject matter.

Issues For Determination 7. The Preliminary Objection and the Application have presented the following issues for determination:a.Whether the instant claim is sub- judice Criminal Case No. 2066/18;b.Whether proceedings in this claim should be stayed to await the outcome of proceedings in Criminal Case No. 2066/18.

Sub- Judice 8. Section 6 of the Civil Procedure Act (Cap 21) Laws of Kenya, sets out the ...relating to sub-judice. It provides thus:“.....No court shall proceed with the trial of any suit or proceeding in which the matter in issue is also directing and substantially in issue in a previous instituted suit or proceeding between the same parties, or between parties under whom they or any of them claim, litigating under the same title, where such suit or proceeding is pending in the same or any other court having jurisdiction in Kenya to grant the relief claimed..”

9. The court in the case of Republic -vs- Registrar of Societies Kenya & 2 others Exparter Mose, Kirima & 2 others [2017]eKLR, expounded on the meaning of this doctrine in the following terms:“....Therefore for the principle to apply, certain conditions precedent must be shown to exist; first; the matter in issue in the subsequent suit must also be directly and substantially in issue in the previously instituted suit; proceedings must be between the same parties, or between parties under whom they, or any of them, litigating under the same title, and such suit or proceeding must pending in the same or any other court having jurisdiction in Kenya to grant the relief claimed.....”

10. The court gave the rationale for the principle in the case of Kampala High court Civil Suit No. 450 of 1993- Nyanza Garage - vs- Attorney General as follows:“..... In the interest of parties and the system of administration of justice, multiplicity of suits between the same parties is to be avoided. It is in the interest of the parties because the parties are kept at a minimum both in terms of time and money spent on a matter that could be resolved in one suit. Secondly, a multiplicity of suits clogs the wheels of justice, holding up resources that would be available for fresh matters and creating and/or adding to the backlog of cases courts have to deal with...”

11. With these legal principle, in the fore, the question arises as to whether the 3rd Respondent’s Notice of Preliminary Objection has satisfied the threshold set by the said principles. We will respond to this question as follows:

12. Firstly, that the fact that there exist civil proceedings emanating from the same subject matter is not a bar to institution and continuation of criminal proceedings. This is the dictate of Section 193 A of the Criminal Procedure Code (Cap 75) Laws of Kenya it provides thus:“Notwithstanding the provisions of any other written law the fact that any matter in issue in any criminal proceedings is also directly and substantially in issue in any pending civil proceedings shall not be a ground for any stay, prohibition or delay of the criminal proceedings...”

13. As rightly submitted by the claimants criminal and civil proceedings can run concurrently. We agree with the Holding of the court in the case of Alfred Lumiti Lusiba -vs- Pethad Pank Shantilal & 2 others[2010] eKLR that:“....The conclusion that one can draw from Section 193 A of the Civil Procedure Code together with the decisions of the learned Judges in the aforementioned cases is that both civil and criminal jurisdiction can run parallel to each other and that neither can stand in the way of the other unless either of them is being employed to perpetuate ulterior motives or generally to abuse the due process of the court in whatever manner..”

14. We could not agree more with the holding of the court in the Alfred Lumiti Lasiba case above. These are civil proceedings governed by civil procedure rules and also different evidential and legal standards. On the other hand, Criminal Case No. 2066/18 is governed by the Criminal Procedure Code with a different set of evidential standard and outcome. While the central component of both cases is guarantorship, the legal burden of proof is totality different in both cases. It cannot this be said that these proceedings an sub-judice the criminal proceedings.

15. We thus do not find merit in the Notice of Preliminary Objection and the Application dated 23. 1.2020.

Claimant’s Application Dated 3. 12. 19 16. The disposal of the 3rd Respondent’s Notice of Preliminary Objection dated 20. 1.2020 and its Application dated 23. 1.2020 paves way for the hearing and determination of the Claimant’s Application dated 3. 12. 2019. The Application dated Orders inter alia:a.That this Tribunal be pleased to issue an injunction restraining the 3rd Respondent from deducting their deposits, savings and/or shares pending the hearing and determination at the claim;b.That the Honourable Tribunal be pleased to order the Directorate of criminal investigation [DCI] Nairobi to produce the handwriting analysis report conducted on the loan from relied on by the 1st and 3rd Applicant;c.Costs.

17. The Application is supported by the grounds on its face and the Affidavit sworn by the 1st Claimant on 16. 11. 2019. The Respondents have opposed the same vide the Replying Affidavit sworn by Dickson Okungu, the 3rd Respondent chief Executive Officer [CEO] on 23. 1.2020.

Claimant’s Contention 18. Vide the instant Application, the Claimants contend that they did not execute the guarantee forms which formed the basis of the 1st and 2nd Respondents being granted loan by the 3rd Respondent. That the 3rd Respondent has gone ahead to recover the defaulted loan from then yet they did not guarantee the same. That it is therefore fair that the 3rd Respondent be restrained form effecting the said deductions.

3Rd Respondent’s Case 19. Vide the Replying Affidavit sworn by Dickson Okungu on 23. 1.2020, the 3rd Respondent has opposed the Application in similar grounds that the suit and the Application are sub-judice Criminal Case No. 2066/2018.

Issues For Determination 20We have framed the following issues for determination:a.Whether the Claimants have established a basis for the grant of an order of a temporary injunction;b.Whether the Claimant has established a proper case to warrant the issuance of an order directing DCI to produce handwriting analysis report conducted on the loan Application forms.

Temporary Injunction 21. We have jurisdiction to make an order regarding temporary injunctions by dint of Order 40 of the Civil Procedure Rules. Order 40 Rule 1 (a) provides thus:“Where in any suit it 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 wrongly 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, until the disposal of the suit or until further orders.

22. Before exercising the above jurisdiction, we are guided by the Principles enunciated by the court in the case of Giella – versus- Cassman Brown [1973] EA. They include:(a)A prima facie case with a probability of success;(b)Irreparable damage; and(c)Balance of Convenience.

23. The court in the case of Mrao Limited versus first American Bank of Kenya Limited (2003) eKLR explained what Constitute a Prima Facie case in the following terms:“.......A Prima Facie case 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 trial. 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 latter......”

Prima Facie Case 24. From the decision of the court in the Mrao case above, it is trite that for a party establish existence of a prima facie case with probability of success, he/she must demonstrate existence of a right that has been violated by the other party so as to call for explanation from the other side. We thus pose the question as to whether the claimants have established existence of the said right. Our answer is in the affirmative. The Claimant contend that the 1st and 2nd Respondent’s obtained a loan of Kshs.4,810,400/= from the 3rd Respondent by falsifying their guarantee ship. That they did not guarantee the said loan yet the 3rd Respondent has commenced recovery of the loan from the. If after trial, it is established that indeed the signatory of the Claimants were illegal procured, then the Respondent will be called upon account.

Irreparable Injury 25. It is noteworthy that the loan alleged to have been guaranteed is colossal. If the 3rd Respondent is allowed to continue recovery the said loan and it later turns out that their signatures were procured illegally, then they will have suffered irreparably.

Balance of convenience 26. When all factors are taken into account, the balance of convenience militates in favour of the injunction being granted.

Orders against DCI 27. Whilst the Claimants have prayed for an order directed at the DCI to produce analysis of the handwriting in the loan Application forms, we find that the same is unnecessary of this stage as the criminal aspects of the matter is .....at the City Court. The Claimants can pursue provision of the said documents in that forum.

Final Orders 28The upshot of the foregoing is that we make the following Orders:1. That the 3rd Respondent’s Application dated 23. 1.2020 and Notice of Preliminary Objection dated 20. 1.2020 are hereby dismissed with costs in the cause;2. That a temporary injunction is hereby granted restraining the 3rd Respondent from making further deduction on the savings, shares, dividends and any benefit accruing to the Claimants pending the hearing and determination of this claim.3. Costs in the Claimant’s Application dated 3. 12. 2019 to be in the cause.

RULING SIGNED, DATED AND DELIVERED VIRTUALLY THIS 4TH DAY OF MARCH, 2021. HON. B. KIMEMIA CHAIRPERSON SIGNEDMR. P. GICHUKI MEMBER SIGNEDMR. B. AKUSALA MEMBER SIGNEDMiss Ambani holding brief for Miss Macharia for 1st to 6th claimantApplication dated 23. 1.2020. No appearance for RespondentHON. B. KIMEMIA CHAIRPERSON SIGNED 4. 3.2021Mention for Pre- trial on 26. 5.2021. HON. B. KIMEMIA CHAIRPERSON SIGNED 4. 3.2021