[2024] KECPT 1394 (KLR)

Wasike v IG (Invest and Grow) Sacco Limited & another (Tribunal Case 373 (E001) of 2022) [2024] KECPT 1394 (KLR) (29 August 2024) (Ruling)

Neutral citation: [2024] KECPT 1394 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case 373 (E001) of 2022

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

August 29, 2024

Between

Gerald Ndombi Wasike

Claimant

and

IG (Invest and Grow) Sacco Limited

1st Respondent

Scheel Vodembeke Chamwada

2nd Respondent

Ruling

1. This ruling dispenses with the notice of Motion Application is dated 24th January 2024 and supported by an affidavit sworn by one Peter Anjeho Vuhya, the Chief Executive Officer of the Applicant, and brought under Order 42 Rule 22 of the Civil Procedure Rules 2010 and section 1a, 1b and 3a of the civil procedure code 2010). The Application seeks the following orders:a.That service of this Application be dispensed with, the same be certified urgent and be heard exparte in the 1st instance.b.That pending the hearing of this interpartes, there be stay of execution of the judgment delivered on 14th December, 2023. c.That there be a stay of proceedings and execution of the judgment delivered on 14th December, 2023 pending the hearing and determination of Kakamega Civil Appeal No. E005 of 2024. d.That costs of this application be provided for.

2. The Application is premised on the grounds on its face which are inter alia that: the Applicant was aggrieved with the judgment of this Tribunal delivered on 14th December 2023 and has filed an appeal. It is the Applicants contention that the appeal has a high chance of success and that he stands a substantial loss unless the orders sought are granted since the Claimant could proceed to execute at any time.

3. The brief background of this matter is that the claimant filed a Statement of Claim dated 12th August 2021, in which he sought an order, which was granted, that “ This honorable court issue an order restraining the 1st and the second respondent, their employee, servants, auctioneers or anybody acting on their behalf from deducting the Claimant’s salary on a loan by the 1st Respondent to the 2nd Respondent, of Kshs. 750,000/- plus accrued interests of Kshs. 143,541/-. It was the Claimant’s contention that he did not sign up to be a guarantor but this was done fraudulently by the 1st Respondent.

4. The Claimant filed Grounds of Opposition. In their Grounds of Opposition, the Claimants contend that the Application does not meet the legal threshold for the grant of stay of execution pending Appeal as no substantial loss has been demonstrated by the Applicant.

5. In their submissions, the Respondents reiterate their Grounds of Opposition that the Applicants have failed to prove specific details of the loss. They also contend that the decretal sum should be deposited in a joint interest-earning account.

Analysis 6. This Tribunal has noted the application, the response, and the submissions with regard to this application. It is not in dispute that judgment was entered in favour of the Claimant as against the Respondent. The question that this Tribunal asks itself is whether the Applicant is entitled to the reliefs sought, to wit stay of proceedings and execution of the judgment pending determination of the Appeal.

7. The principles guiding the grant of a stay of execution pending appeal are well settled. These principles are provided for under Order 42 rule 6(2) of the Civil Procedure Rules which provides:“No order for stay of execution shall be made under subrule (1) unless—(a)the court is satisfied that substantial loss may result to the applicant unless the order is made and that the application has been made without unreasonable delay; and(b)such security as the court orders for the due performance of such decree or order as may ultimately be binding on him has been given by the Applicant.”

8. In the Court of Appeal decision in Chris Munga N. Bichage –vs- Richard Nyagaka Tongi & 2 Others eKLR the Learned Judges stated the principles to be applied in considering an application for stay of execution as thus:-“……………. The law as regards applications for stay of execution, stay of proceedings or injunction is now well settled. The Applicant who would succeed upon such an Application must persuade the court on two limbs, which are first, that his appeal or intended appeal is arguable, that is to say it is not frivolous. Secondly, that if the application is not granted, the success of the appeal, were it to succeed, would be rendered nugatory. These two limbs must both be demonstrated and it would not be enough that only one is demonstrated………”

9. Further in RWW v EKW [2019] eKLR, considered the purpose of a stay of execution order pending appeal, in the following words:“The purpose of an application for stay of execution pending an appeal is to preserve the subject matter in dispute so that the rights of the appellant who is exercising the undoubted right of appeal are safeguarded and the appeal if successful, is not rendered nugatory. However, in doing so, the court should weigh this right against the success of a litigant who should not be deprived of the fruits of his/her judgment. The court is also called upon to ensure that no party suffers prejudice that cannot be compensated by an award of costs.”

10. From the above authorities, it is clear that the purpose of granting a stay is to preserve the subject matter so that if the appeal succeeds it is not rendered nugatory. What is the subject matter of this appeal? To enforce the guarantee contract against the Claimant/Respondent. Is there a risk that the appeal will be rendered nugatory if these orders are not granted? We feel not. The Applicant has not shown specifically how it will incur financial loss should we not grant a stay.

11. The Claimant is a school teacher who is still servicing a personal loan from the Applicant. It is on record that the Applicant reversed the amount it had recovered from the Claimant as a guarantor since his salary could not bear both his loan and the guaranteed amount. We feel that should the appeal succeed, nothing will bar the Applicant from recovering the defaulted amount from the Claimant, since if the Claimant was indeed a guarantor, the guarantee contract will still be in force, since a contract of guarantee only lapses when the loaned amount has been fully settled.

12. In the upshot of the foregoing, we make the following orders;a.Notice of Motion Application dated 24th January 2024 is hereby dismissed with costs.b.File ordered as closed.

RULING SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 29TH DAY OF AUGUST, 2024. Hon. B. Kimemia - Chairperson Signed 29. 8.2024Hon. J. Mwatsama - Deputy Chairperson Signed 29. 8.2024Hon. Beatrice Sawe - Member Signed 29. 8.2024Hon. Fridah Lotuiya - Member Signed 29. 8.2024Hon. Philip Gichuki - Member Signed 29. 8.2024Hon. Michael Chesikaw - Member Signed 29. 8.2024Hon. Paul Aol - Member Signed 29. 8.2024Tribunal Clerk JonahWekesa Were advocate holding brief for Mr. Wachakana advocate for the Claimant.Invest and Grow Sacco- No appearance.Nandwa & Company advocate for Respondent – No appearanceHon. J. Mwatsama - Deputy Chairperson Signed 29. 8.2024