[2022] KECPT 896 (KLR)

Orient Sacco v Ngigi (Tribunal Case 126 of 2021) [2022] KECPT 896 (KLR) (16 December 2022) (Ruling)

Neutral citation: [2022] KECPT 896 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case 126 of 2021

BM Kimemia, Chair, J. Mwatsama, Vice Chair & M. Mbeneka, Member

December 16, 2022

Between

Orient Sacco

Claimant

and

James Njoroge Ngigi

Respondent

Ruling

1. The matter for determination is a notice of motion application undated and filed on August 26, 2021 seeking the following orders:a.That statement of defence dated April 8, 2021 be struck out for scandalous, frivolous and/or vexatious.b.That this honourable tribunal be pleased to enter summary judgment in favour of the applicant for the sum of Kshs 3,977,833. 48 as at January 28, 2021, with interest thereon from the date of the surcharge orders.c.That this honourable tribunal be pleased to order pursuant to section 75 of CooperativeSocieties Act that Kshs 3,977,833. 48 is a civil debt that shall be recoverable summarily.d.That this honourable tribunal be pleased to order the immediate payment of Kshs 3,977,833. 48 to the applicant.e.That the respondent be condemned to pay the costs of this application as well as the costs of the entire suit.Based on the grounds on the face of the application and supported by the affidavit of Bedan Kinyanjui Murang’a.The respondent did not file any replying affidavit despite orders of the tribunal but instead filed written submissions dated April 11, 2022. The claimant also filed written submissions dated November 22, 2021. The claimant submitted that the claim dated January 28, 2021 is for adoption of surcharge orders of commissioner for cooperative development for Kshs 3,977,833/48 dated July 3, 2019.

2. The claimant prays for the defence of respondent be struck out as it discloses no reasonable cause of action or defence in law ex cetra. Under order 2 rule 15 (1).That the tribunal has been called upon to adopt the surcharge orders issued as per section 74Cooperative Society Act and there was no need to file a defence since there was no appeal filed to challenge the findings of the inquiry officers or the surcharge orders.That judgment should be entered in line with the surcharge orders as provided under section 58, 73 and 74 Cooperative Societies Act. That the issues raised in the defence do not suffice owing to the fact that there is procedure provided for in order to challenge the surcharge order.The respondent submitted that he was not served with the notice to the annual general meeting. That he was not invited by the inquiry team to present or defend himself.That the surcharge order and inquiry report has no basis and is not justifiable.That he was served with the intention to surcharge on May 9, 2019 and he made his submissions to the commissioner for cooperative development on May 21, 2019. That as alleged with the surcharge order on January 29, 2021 via WhatsApp on his cell phone. That this was not a proper mode of service and he should have been served via email. That he was therefore not given an opportunity to the surcharge order (paragraph 6,7 and 9).The respondent cited the Fair Administration Act and the provisions therein, which were not followed.

3. We have carefully considered the evidence on record. It’s clear that the respondent filed his submissions with the commissioner for cooperative development.He has not indicated what actions he took to ensure that he followed up with the submissions, if any. However, it is clear that he was served with the surcharge orders through WhatsApp on his cellphone number. We deem this service as sufficient.

4. In this matter, the claimant filed the claim for the adoption of the surcharge order under section 75 (1) Cooperative Societies Act. There was an inquiry process by the commissioner for cooperative development and thereafter it was adopted by the society.The respondent was served with the notice of intention to surcharge and the surcharge order. There was no appeal filed within 30 days of service as required under section 74 Cooperative Societies Act.

5. Once a surcharge order has been issued, the only way it can be set aside or challenged is vide an appeal in the tribunal within 30 days. Once the 30 days right of appeal have lapsed, the only jurisdiction left in the tribunal is to adopt the surcharge order summarily and the same is recoverable as a civil debt.

6. If a person wishes to challenge the inquiry, they address the challenge to the commissioner for cooperative development and if they are not successful, then the commissioner for cooperative development issues a surcharge order-Felix – Otande - versus Commissioner for Cooperative Development and another [2021]eKLR.There was no appeal filed to challenge the surcharge order and now what remains is for the tribunal to adopt the said order for purposes of recovery- Alfayo Nyairo – versus - Nyabomite Farmers Cooperative Society Limited [2021]eKLR.

7. We find that the provisions of section 75 (1) Cooperative Societies Act are crafted in mandatory terms. In the circumstances therefore, we find that the application undated filed on August 26, 2021 has merits and is allowed as prayed with costs.The defence is struck out and summary judgment entered in favour of the claimant against the respondent for Kshs 3,977,833/48 plus costs and interest in the claim.

RULING SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 16TH DAY OF DECEMBER, 2022. Hon. Beatrice Kimemia Chairperson Signed 16. 12. 2022Hon. J. Mwatsama Deputy Chairperson Signed 16. 12. 2022M. Mbeneka Member Signed 16. 12. 2022Tribunal Clerk J. MutaiMabachi advocate holding brief for Mr. Mathenge for the Claimant.James Njoroge Ngigi- no appearance.Hon. J. Mwatsama Deputy Chairperson Signed 16. 12. 2022