[2022] KECPT 167 (KLR)

Pan Africa Staff Society Limited v Kitela (Tribunal Case 287 of 2016) [2022] KECPT 167 (KLR) (Civ) (24 March 2022) (Judgment)

Neutral citation: [2022] KECPT 167 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Civil

Tribunal Case 287 of 2016

J. Mwatsama, Vice Chair, P. Gichuki & B. Akusala, Members

March 24, 2022

Between

Pan Africa Staff Society Limited

Claimant

and

Pius Kitela

Respondent

Judgment

1. The matter for determination is one vide Amended Statement of Claim dated 17. 11. 2020 filed on 19. 11. 2020. The Claimant avers the Respondent applied and was granted the following loans while a member of the Claimant.1. On 29. 5.2006 Respondent applied for a loan of Kshs.30,000/= for funeral expenses.2. On 23. 10. 2007 Respondent applied for a loan of Kshs. 1,000,000/= for house construction3. On 5. 1.2009 Respondent applied for a school fee loan of Kshs.50,000/=.4. On 6. 3.2009 Respondent applied for a TOUP loan of Kshs. 400,000/= but only Kshs. 300,000/= was dispatched.5. On 30. 7.2010 Respondent applied for a loan of Kshs.3,000,000/= for home improvement.The Claimant avers respondent was given/disbursed Kshs. 4,300,000/= instead of Kshs. 3,000,000/=.6. On 30. 12. 2011 Respondent applied for a salary advance of Kshs. 200,000/=.The total disbursed loans by Claimant to Respondent is Kshs. 5,880,000/= and as of the date of the Amended Statement of Claim the Respondent had repaid Kshs. 2,052,127. 50/= and thus Respondent has an outstanding balance of Kshs. 3,827,872. 50/=.

2. Respondent had membership shares of Kshs. 1,189,716/= before withdrawing from the Claimant.On 28. 10. 2016 Respondent accumulated membership shares were reduced by 42% pursuant to a resolution at Claimant’s Annual General Meeting held on 28. 10. 2016 thus his outstanding share capital after 42% deduction is 752,195 shares.The Claimant prayer prays for:a.The said sum of Kshs 3,674,345. 80/= being loan defaulted and interest.b.Costs of the suit and interest until payment in full.c.Any other relief so deemed appropriate by this Honourable Tribunal.

3. The Respondent filed a statement of defence dated 30. 8.2016 on 31. 8.2016. The Respondent stated the claim did not disclose any reasonable cause of action against him and put Claimant to strict proof.He denies defaulting the loan and leaving a balance of Kshs. 3,031,513. 55/=.The Respondent avers while working for Claimant he was deducted Kshs. 91,068. 50 every month thus its not true the amount borrowed is still the same.Further he avers the Claimant instructed firm of Muriu Mungai Advocates to collect he outstanding amount from Respondent which cheque worth Kshs. 600,000/= was paid on behalf of the Claimant to the firm.We do note the Claimant did not annexed his Statement of Defence despite the Claimant having filed his amended Statement of Claim and the same done by consent of the parties.

4. Matter proceeded for full hearing with the Claimant calling two witnesses. CW1 was Dennis Kirinjui who adopted his witness statement dated 17. 7.2019 as his evidence in chief. He also produced his documents in list of documents as a bundle marked C EX. 1. He further stated the Respondent was not an active member since 2008 and there was no document evidencing his withdrawal from the Sacco.He took the Tribunal through the Claimant’s list of documents and showing loans granted and cheques used to disburse the loans.On cross examination he confirmed that the loans in paragraph 4 a-e all were paid back by Respondent.He clarified pargraph 5 of his witness statement the loans were issued using different cheques and stated Respondent is the only one who can explain the excess payment in the loan of Kshs. 3,000,000/= and instead got Kshs. 4. 300,000/=.The payment to Muriu Mungai Advocate was their fee for debt collection and not as Respondent would want Tribunal to be for the loan.On re-examination CW1 stated Claimant had not disputed the statement now had he disputed the amounts.Respondent was chair of Claimant as of 2014. CW2 was the Chairman of Claimant and he adopted his written statement dated 17. 7.2019 and same produced as evidence - in -chief. He was in the Supervisory Committee for the minutes in the Annual General Meeting on page 50 of the documents.On cross examination he stated they had made several attempts to recover the loan and even engaged Muriu Mungai company Advocate to recover the loan to no avail. The firm paid them Kshs. 400,000/= less their legal charges.

5. The Respondent did not call any witness and closed their case.Parties were directed to file written submission on 23. 9.2021 on even dates and Respondent filed their written submissions dated 16. 11. 2021 on even date.After careful analysis of the pleadings and evidence before the Tribunal the issues for determination are as follows:

Issue one:Whether the Claimant has discharged their…….against Respondent.The Claimant avers Respondent owes them for loans amount which accumulated over time while Respondent was their Chairman.It is not in contention that the 1st loans as per Amended Statement of Claim were paid off as per evidence of CW1. The Claimant however state the loan approved of Kshs. 3,000,000/= was disbursed as Kshs. 4,300,000/= irregularly.The Respondent avers the Claimant did not produce evidence in support of their claim of the loan of Kshs 3,000,000/=. 6. The Claimant avers the Respondent has failed to explain the excess payment of Kshs. 1,300,000/= paid by Claimant into his account. The Respondent did not offer an explanation on the same as well.Issue of evidence arises with each party claiming favour to their side.Respondent aver no document equals to no evidence. He who alleges must prove and Claimant if the Respondent cannot explain reason for the payment by Claimant then he ought to pay up.The Claimant refer us to (page 6 written submissions)Mhendeshaw- vs- Respondent(2002) 1KLR 461…………………We do take note the excess funds of Kshs. 1. 300,000/= were made while Respondent was Chairman of Claimant.We can only speculate why Respondent was being paid such amounts of money if he indeed does not offer an explanation.Asset Recovery Agency- vs- Pamela Aboo (EACC 248)eKLR.Respondent conveniently or not did not testify (page 7 written submissions)on file any written statement or document.

7. From the above indeed the burden of proof shifted from Claimant to respondent moreso for the loan of Kshs. 3,000,000/= and excess of Kshs. 1,300,000/= paid out during the time.we cannot turn a blind eye on the ongoing of our Cooperatives and Sacco, burry our heads in the said and deny impropriety amongst some officials of the Cooperatives and Sacco in the name of no evidence having been adduced.We find the ,Claimant have proved their case against Respondent on a balance of probability and thus award Claimant judgment against Respondent for Kshs. 3,075,677. 50/plus costs and interest from date of filing suit.

JUDGMENT SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 24TH DAY OF MARCH, 2022. Prepared by:HON. J. MWATSAMA DEPUTY CHAIRPERSON ............MR. P. GICHUKI MEMBER ...............MR. B. AKUSALA MEMBER .............TRIBUNAL CLERK ...................