Bernard Gichuki v Stima Investment Co-operative Society Limited [2021] KECPT 547 (KLR)

REPUBLIC OF KENYA

IN THE CO-OPERATIVE TRIBUNAL

AT NAIROBI

TRIBUNAL CASE NO. 13 OF 2020

BERNARD  GICHUKI.......................................................................................CLAIMANT

VERSUS

STIMA  INVESTMENT  CO-OPERATIVE SOCIETY LIMITED ..........RESPONDENT

RULING

The matter  for determination  is a Notice of Motion  dated  9. 9.2020 seeking  the following  orders:-

i. That  Honorable   Tribunal  be pleased  to declare  that this  cause  has been  wholly  adjusted  by a lawful  agreement  entered  by the parties.

ii. That  the Honorable  Tribunal  be pleased  to adopt  the agreement  entered  into by the  parties  as the judgment  of the Tribunal.

iii. That  the Honorable  Tribunal  be pleased  to order  that implementation and execution of the resulting  decree thereof.

iv. Costs.

The Application  is based  on the grounds  on face  of Affidavit  supported  by affidavit  of Bernard  Gichuki deponed  on 9. 9.2020.

The Application  was opposed  vide  a Replying Affidavit  of Viola  Odhiambo legal counsel  for the Respondent  deponed  on 27. 10. 2020.

The Application was determined  by way of  written submissions  as ordered.

Parties filed their written submissions on 11. 12. 2020 and 9. 12. 2020.

APPLICANT’S SUBMISSIONS

1. The Applicant  submitted  that by a  letter dated  27. 6. 2020.

The Respondent  through  its lawyer  wrote to Claimant’s Advocate  proposing  an out  of court settlement  and  the Advocate  accepted  the Respondent  proposal  vide a   letter dated  6. 7.2020.

That  both parties had met and agreed  and a tentative agreement  had been reached  subject  to the confirmation  of the  parties,  that thereafter  on 19. 8.2020 the Respondent  Advocate  wrote  back  with a counter –offer  which  was  accepted by Claimant  a letter  dated 21. 8.2020.

2. That  what  remained  was the Respondent  to  satisfy the agreement. However,  the Respondent  stated  they are not  willing  to settle  the accrued  interest  not withstanding  that the parties  had negotiated and agreed  on the same.

RESPONDENT’S  SUBMISSIONS

3. In response  the Respondent  submitted  that in good  faith they invited  the Claimant  for an out of  court settlement  that while negotiations  were still  ongoing  they were  served with  the current  Application.

4. That  the negotiations were  still ongoing  and there  was no obligation  set by  either party to complete  the agreement  on  a specific  date.  That no valid agreement  can be  established  from the instant  case since  there was  no conclusion on the negotiations.

5. That  the previous  contract  between  the parties  necessitated  payment  as follows:

i. Purchase  price  for ¼ acre plot   kshs.270,000/=

ii. Investment  share                          Kshs.30,000/=

iii. Investment  contribution             Kshs.5000/=

iv. Application  fees                           Kshs.1000/=

That  the contract  purchase  price was  Kshs.270,000/= and  anything  sought  outside  this sum is  not enforceable.

That  the claimant therefore filed this application  in bad faith and  he rejected  the cheque  despite  communication  that  the interest  would be  negotiated.

6. That the Respondent  acknowledged  its obligation  towards the  Claimant and  is ready  to  fulfill their  for  purchase  price of  Kshs.270,000/=, interest  13. 37%.

That  it was only prudent  to settle  the matter as  agreed  relying  on the negotiations  to write  the alleged  default  in performance.

That  it is prejudicial  for the Claimant  to seek  enforcement  of a non-existing  contract  hence  the Application  ought  to be dismissed  with costs.

issues

i. Whether  there was  a legal  agreement  that  is enforceable.

ii. Costs.

a. Whether  there was  a legal  agreement  that  is enforceable.

7. The Claimant  submitted  that vide  letter dated 27. 6.2020 the Respondent proposed  an out  of court  settlement. That  6. 7.2020 the Claimant  accepted  the proposal  but the Advocates  wrote  and agreed  as per letter dated  14. 7.2020.

In which letter  the total  investment  income was  tabulated  as kshs.635,805/= and costs  at Kshs.101,358/= as  party  to party costs that is,

Interest             kshs.6,388/=

Filing fees         kshs.13,090/=

Service fees        kshs.2000/=

Attendance         kshs.2100/=

8. That  thereafter  there were  subsequent  negotiations  which  vacated  the agreement  which  the Claimant seeks  to enforce.

9. That  the Respondent  did not  file  before the  Tribunal  the subsequent  negotiations  that vacated  the earlier  agreement.

10. That  the Respondent has failed  to demonstrate  any valid  reason  why the agreement  should not  be enforced.

11. That  the Respondent did  not respond  to letter  of demand and  has not filed a response  to the claim therefore they engaged  in futile  negotiations  knowing very well they had  no  intention  of honoring  the negotiations.

12. The Respondent  submitted  that the Claimant  abandoned  the negotiations  and disrupted  the aim of settlement  by filing  this  application  in order  to intimidate  the Respondent  in agreeing  to the clauses  that are  not part  of the contract.

That  this can be  deduced  from the Claimant’s prayer  in enforcing  a non-existing  contract.

13. We  have carefully  considered  the submissions, pleadings  and documents  filed  by the parties  and we note  that indeed  the parties  were engaged  in negotiations.

There  were letters  exchanged  between the parties  but  there was no  conclusive agreement  reached  in terms  of a settlement.

14. It is  trite law that when  parties  are negotiating an out of  court/Tribunal  settlement  both parties  must reach  a conclusive  decision/agreement  and which agreement is  filed for adoption  by consent  of both parties.

15. In  the instant case  all that is  on record  are offers and counter offers, in terms  of letters which  have not  reached  a conclusion.

16. The Claimant seeks  for the “agreement reached” be declared  as “wholly adjusted by a lawful agreement  entered by  the parties” however,  we have  noted that  no  document  filed by  either  of the parties  amounts  to  an agreement  entered  into  by the parties  to settle  the matter.

17. In  the circumstances  thereof  we find  that there is  no agreement  that is legally  binding  and enforceable  between  the parties  as prayed  for in the application  as dated 9. 9.2020.

We therefore find  the application  has no  merit  and dismiss  it as premature.

i. Costs

Costs  follow  the event in  this instant  case  we order  for the costs  to be in the cause.

RULING  SIGNED, DATED AND DELIVERED VIRTUALLY THIS 27TH  DAY OF MAY, 2021

Hon. B. Kimemia                Chairperson                Signed      27. 5.2021

Hon. J. Mwatsama              Deputy Chairperson  Signed      27. 5.2021

Mr. P. Gichuki    Member    Signed      27. 5.2021

Tribunal Clerk    Leweri

Bernard  claimant present in  person: Present

No appearance for Respondent

Parties to file  and serve  witness  statement  and documents  within  30 days  herein.

Pre- trial  mention  on  28. 7.2021. Notice to issue.

Hon. B. Kimemia    Chairperson    Signed  27. 5.2021