CO-OPERATIVE BANK(K) LTD v JOHN GITHAIGA NDERI & ANOTHER [2007] KEHC 2327 (KLR)

REPUBLIC OF KENYA IN THE HIGH COURT OF KENYA AT NYERI

Civil Case 86 of 2001

THE CO-OPERATIVE BANK(K) LTD……………………...……….PLAINTIFF

Versus

JOHN GITHAIGA NDERI

ESTHER WANJIRU GITHAIGA……………………….…….….DEFENDANTS

JUDGMENT

The Plaintiff’s case arises out of a loan granted by the Plaintiff to the 1st Defendant.  That facility was guaranteed by the Defendant and in addition the 2nd Defendant charged her property L.R. NO. MWEIGA BLOCK 5/MUTHUINI/27as security for the said facility.  The Plaintiff averred in the Plaint that the 1st Defendant defaulted in the repayment of the facility and that thereafter the Plaintiff unsuccessfully attempted to reaslise the charged property.  That there were luck of acceptable bids to the said sale.  The Plaintiff therefore prayed for judgment against the Defendants jointly and severally for Ksh.782,862. 75 together with compound interest at the rate of 25% from the 1st April 2001 until payment in full.  On the day of hearing the Defendants, although served, failed to attend court.  P. W.1 stated that he is a credit officer with the Plaintiff and has been so for the last five years.  He stated that the 1st Defendant was granted a loan of Ksh.300,000/- on 29th October 1996.  On the letter of offer which the 1st Defendant signed, it was provided that the loan would accrue interest at the rate of 29%, that is 6 % above base rate.  As security for the said loan the Defendants offered property MWEIGA/BLOCK 5/MUTHUINI/27.  In addition the 2nd Defendant offered a personal guarantee.  After all the finalities were completed the 1st Defendant had the loan dispersed on the 8th January 1997 for Kshs.300,000/=.  The Defendant failed to regularly maintain the loan account and on the 10th March 1998 the Plaintiff demanded the amount of Ksh.63,000/= as arrears and Ksh.66,776/= for the overdrawn current account.  That demand elicited a response from the 1st Defendant by a letter dated 9th April 1998 where he indicated that he would continue to service the loan and committed himself to stabilize the current account.  That promise was not upheld and a subsequent demand was sent dated 22nd December 1998.  By then the account was in arrears of Ksh.130,133. 25 and the 1st Defendant failed to respond to the demand.  On 12th March 1999, a demand was sent to the guarantor to the effect that the amount due and payable by the 1st Defendant was Ksh483,517. 05.  In that demand the Plaintiff threatened to realize its security by sale of the charged property.  P. W. 1 then gave evidence of the various attempts that were made by auctioneers to sell the charged property but that the same failed to realize any bidders.  Thereafter demands were sent to the Defendants and the Defendants failed to respond.

In support of the Plaintiff’s claim there were exhibited bank statements, the charged document, the 2nd Defendant’s guarantee and the demands that were sent to Defendants.

I have examined the Plaintiff’s exhibits and have considered the evidence submitted on behalf of the Plaintiff and I find that a case has been made against the Defendants as prayed.  Accordingly the court does hereby enter judgment for Ksh.782,862. 75 as at 28th October 2000 and with compound interest for 25% per annum, applicable from the 28th October 2000.  The Plaintiff shall also have costs of the suit.

Dated and delivered at Nyeri this 6th day of July 2007.

MARY KASANGO

JUDGE