[2024] KECPT 1157 (KLR)

Wambua v Nzioka (Tribunal Case 529 of 2018) [2024] KECPT 1157 (KLR) (25 July 2024) (Judgment)

Neutral citation: [2024] KECPT 1157 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case 529 of 2018

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

July 25, 2024

Between

Bonifave Musyoka Wambua

Claimant

and

Anthony Mutua Nzioka

Respondent

Judgment

Brief Background. 1. From 2011 to 2016 both the Claimant and the Respondent were workmates at Alliance for a Green Revolution in Africa (AGRA) and both of them were members of Kimisitu Sacco Society Ltd. That sometime in 2016, the Respondent approached the Claimant to guarantee him upto Kshs. 150,000/= for a loan that he intended to borrow from Kimisitu Sacco Ltd. the Claimant agreed to offer his deposits/savings as collateral for the repayment.At the same time, in 2017, the Claimant approached the Respondent to guarantee him for two (2) Loans of Kshs. 711,292. 69/= and Kshs. 20,693. 15/= of which the Respondent agreed.In 2017, the Respondent defaulted in the Loan repayment which necessitated the Sacco to recover it from the guarantors, thus the gist of this suit.

2. The Claimant moved this Tribunal vide a Statement of Claim dated 15th October, 2018 which was filed on 5/11/2018 seeking for judgement against the Respondent for; 1. A refund of Kshs. 74,248. 78.

2. Interest on (i) above.

3. Costs of the suit.

4. General damages for pain and suffering.

3. In support of the Claim, the Claimant filed a Witness Statement sworn by the Claimant, a Verifying Affidavit and a List of Documents.

4. Upon receipt of the Claimant’s Statement of Claim, the Respondent filed a Statement of Defence 29/11/2018 and denied that he defaulted to service his Loan.

5. However, the Respondent admitted that he approached the Claimant to guarantee him for a loan and that he defaulted in order to condemn/punish the Claimant who had earlier defaulted and made him to repay a defaulted sum. More specifically, the Respondent stated under paragraph 5 and 6 as follows:Paragraph 5 “the Respondent avers that he had agreed to act as a guarantor with respect to two(2) Loans and which the Claimant declined to repay the entire sum leading the Respondent’s shares deposited with the Sacco to be deducted to recover the amount owing from the Sacco.”Paragraph 6 “ the Respondent admits having defaulted on the Loan advanced to him by the Sacco but contends that the same was necessitating by the earlier default by the Claimant for the Loans guaranteed to him by the Respondent”.

6. The matter was set for oral hearing on 17/7/2023. On Cross-examination about his default of the Loan of approximately Kshs. 1,300,000/= that he had borrowed, the Claimant testified that he did not default but there was miscommunication when he changed jobs.“I cleared all the loans, no guarantors lost their money.”

7. The Respondent did not attend the hearing and his advocate sought for adjournment because his client was unwell.The Tribunal adjourned the matter and fixed the Respondent’s case hearing date to be on 22/11/2023.

8. On the day of the hearing, 22/11/2023, the Respondent failed to attend the Tribunal and his advocate sought to cease acting for him and requested that the matter be taken out of the day’s cause list. This was opposed by the Claimant’s advocate.

9. Because of failure of the Respondent to attend, the Tribunal adjourned the matter and directed as follows:a.That the Claimant to file and serve Written Submissions within 7 days.b.The Respondent to file and serve Written Submissions 7days upon service.These orders were complied with by both parties.

Analysis And Determination. 10. We have read the documents and examined the exhibits provided by both parties. We have isolated two issues for determination.i.Whether the Claimant is entitled to a refund of Kshs. 74,248. 78/= by the Respondent.ii.Who should bear the costs of this suit.Whether the Claimant is entitled to a refund of Kshs. 74,248. 78/= by the Respondent?Both the Claimant and Respondent brought out the issue of defaults in a convulted manner such that the Respondent lost track of the gist of the matter.We note with dismay the reasoning of the Respondent that he defaulted to repay the loan which was guaranteed by the Claimant in order to score on a purported default which the Claimant had visited on him earlier.

11. The Respondent in his signed witness Statement undated and Paragraph 5 and 6 of his Statement of Defence portray vindictiveness in the following words at Paragraph 6. 1.The Respondent admits having defaulted on the Loan advanced to him by the Sacco but contend that the same was necessitated by the earlier default by the Claimant for the Loans guaranteed to him by the Respondent. (emphasis ours)

12. Ordinarily, if the Respondent felt short changed by the Claimant, the much he could have done is to file an Application for Counter-claim or a set-off which he did not do. This may be interpreted to mean that he did not have any evidence to show that Kimisitu Sacco recovered from him the defaulted by the Claimant from his share of savings.

13. Conversely, we note that the Respondent attached a letter from Kimisitu Sacco Limited dated 27/9/2018 addressed to the Claimant to the effect that he defaulted on two(2) loans which he had been loaned. If the Sacco recovered the amounts indicated against each guarantor, why didn’t the Respondent move the Tribunal for recovery of the deducted amounts?

14. As if that was not enough, the Respondent failed twice to attend the oral hearing despite his advocate’s spirited effort to locate him. In that regard, the Tribunal did not get the benefit to get any other reason why the Respondent defaulted to repay his loan in total.We therefore find that the testimony of the Claimant was not controverted.

15. Accordingly, the law is clear on liquidated demands specifically Order 10 Rule 4(2) which provide:“Where the Plaint makes a liquidated demand together with some other claim and the Defendant fails or all the defendants fail to appear as aforesaid, the court shall on request in form no. 13 of appendix A, enter judgement for the liquidated demand and interest thereon as provided by sub-rule (1) but the award of costs shall await judgement upon such other claim”.

16. Given that the Respondent admitted that he defaulted to pay his loan with Kimisitu Sacco upto the tune of Kshs. 74,248. 78/= in retaliation of the previous act of the Claimant which made him to pay for him the amount he defaulted to pay. We find that the Respondent admitted the existence of the default on his part of which the guarantors had to shoulder and they did shoulder.

17. Evidentially and orally, we find that the Claimant proved his case on a balance of probability and find that the Claimant’s Statement of Claim dated 15/10/2018 has merit.We therefore enter judgement in favour of the Claimant against the Respondent for the refund of Kshs. 74,248. 78/= plus interest at Tribunal rates and costs from the date of filing the claim.

JUDGMENT SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 25TH DAY OF JULY, 2024. HON. B. KIMEMIA CHAIRPERSON SIGNED 25. 7.2024HON. J. MWATSAMA DEPUTY CHAIRPERSON SIGNED 25. 7.2024HON. BEATRICE SAWE MEMBER SIGNED 25. 7.2024HON. FRIDAH LOTUIYA MEMBER SIGNED 25. 7.2024HON. PHILIP GICHUKI MEMBER SIGNED 25. 7.2024HON. MICHAEL CHESIKAW MEMBER SIGNED 25. 7.2024HON. PAUL AOL MEMBER SIGNED 25. 7.2024Tribunal Clerk JemimahKipchumba advocate holding brief for Eelkington for RespondentMutembei advocate holding brief for Kingoo for ClaimantKipchumba advocate for Respondent : We pray for 30 days stay of executionMutembei advocate – No objection.Order: 30 days stay of execution granted.HON. B. KIMEMIA CHAIRPERSON SIGNED 25. 7.2024