[2025] KECPT 90 (KLR)

Tai Sacco Society Limited (Successor To/Formerly) Kiambu Tea Growers Sacco Society Limited v Nyakiri Coffee Farmers Co-operative Society Limited (Tribunal Case 448 of 2013) [2025] KECPT 90 (KLR) (30 January 2025) (Judgment)

Neutral citation: [2025] KECPT 90 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case 448 of 2013

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

January 30, 2025

Between

Tai Sacco Society Limited (Successor To/Formerly) Kiambu Tea Growers Sacco Society Limited

Claimant

and

Nyakiri Coffee Farmers Co-operative Society Limited

Respondent

Judgment

1. The matter for determination is a Statement of Claim dated 1st August 2013. In the Statement of Claim, the Claimants claim that it was a member of the Respondent, vide account number 000-848. It’s the Claimants claim that the Respondent deposited a cheque of Ksh. 3,703,588. 50/- with the Claimants to be used to pay the Respondent’s members dues. However, after the paying part of the Respondent’s members to the tune of Ksh. 1,905,692. 50, the cheque cheque earlier on deposited bounced. Its their claim that so far the Respondents has paid only Ksh. 350,000/- and the rest is owing. The Claimants are aggrieved and prays fora.Payment of Kshs.1,555,692. 50/=b.Costs and interestc.Any other relief this tribunal deems fit to grant.

2. The filed a response to the statement of claim dated 18th October 2013. In their response, the Respondent admits that it issued a cheque for ksh. 3,707,588. 50 , and they indeed repaid Ksh. 350,000/- but dispute the circumstances under which the Claimant claims the cheque was paid. They pray the court to dismiss the Claim, or in the altertive direct that the agreement between the parties be given prominence.

3. During the hearing, one Jane Mungai testified on behalf of the Claimants. She told the court that she is the operations administrator of the Claimant. She reiterated her claim as per the statement of Claim and informed the court that they are claiming Ksh. 1,005,692. 50/- as per the time of the hearing and acknowledge that they had received Ksh. 900,000/.

4. One Josephat Kahuhia, the Chairman of the Respondent, testified for the Respondent. He acknowledge the debt owing to the Claimants, however informed this court that they are going through financial challenges, and that they have no operations, no employees, no money and have no title. He informed the court that the farmers are willing to revive the cooperative.

5. Only the Claimants filed their submissions.

6. In their submissions, the Claimants urged this Tribunal to enter judgement as prayed. They noted that this is an old matter, and various attemps to settle the same with the Respondents have proven futile. They urged this court to note that the Respondents have not disputed the Claim.

Analysis 7. This Tribunal has taken note of the pleadings filed by the parties, submissions, together with the evidence adduced during the hearing. It is not in dispute the Respondent was a member of the Claimant. It is also not in dispute that the Respondent issued a cheque to the Claimant that later bounced. The repayments and the amounts due is not disputed either. The only issue the Respondents raise is that they are going through challenges and that the cooperative is totally run down.

8. This Tribunal sympathizes with the Respondent’s financial situation. However, as long as the Co-operative society is still in existence, and has not gone into liquidation or declared insolvent, it is expected to honor its financial obligations. Even if it were bankrupt or insolvent, the law expects the members of the cooperative society to honor their obligations and meet the debts of the Cooperative society as per Section 22(c) of the Cooperative Societies Act. Financial challenges or lack of operations will not lift a society’s obligations of repaying its debts. Since the debt is not disputed, we find that the Claimant is entitled to it’s money.

9. Flowing from above, we find merit in the Claimants Claim and order as follows-a.Immediate refund of Ksh. 1,005,692. 50/- to the Claimantb.The Claimant is awarded costs of this suit together with interest from date of filing suit at Tribunal rates until payment in full.

JUDGMENT SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 30TH DAY OF JANUARY, 2025. Hon. J. Mwatsama - Deputy Chairperson Signed 30. 1.2025Hon. Beatrice Sawe - Member Signed 30. 1.2025Hon. Fridah Lotuiya - Member Signed 30. 1.2025Hon. Philip Gichuki - Member Signed 30. 1.2025Hon. Michael Chesikaw - Member Signed 30. 1.2025Hon. Paul Aol - Member Signed 30. 1.2025Tribunal Clerk MutaiGitau advocate for claimant- PresentNyakiri Coffe Farmers FCS limited – No appearanceHon. J. Mwatsama - Deputy Chairperson Signed 30. 1.2025