Daniel Kinuthia Kiarie v Nakuru Teachers Housing Co-Operative Society Limited; Co-Operative Bank of Kenya Limited & Teacher Service Commission (Interested Parties) [2021] KECPT 582 (KLR)

REPUBLIC OF KENYA

IN THE CO-OPERATIVE TRIBUNAL AT NAIROBI

TRIBUNAL CASE NO.250 OF 2020

DANIEL KINUTHIA KIARIE................................................................CLAIMANT

VERSUS

NAKURU TEACHERS HOUSING

CO-OPERATIVE SOCIETY LIMITED..........................................RESPONDENT

CO-OPERATIVE BANK OF KENYA LIMITED......1ST INTERESTED PARTY

TEACHER SERVICE COMMISSION.....................2ND INTERESTED PARTY

RULING

Vide the Application dated 10. 8.2020, the Claimant has moved this Tribunal seeking for Orders inter alia:

a. Spent;

b. That pending the inter-parties hearing  of this Honorable Tribunal be pleased to issue an order of mandatory injunction compelling the Respondent and the Interested party by themselves, their agents and servants to produce the loan agreement, render a full, accurate, truthful, and concise reconciled account of the claimant loan account to facilitate the proper and fair determination of the current suit.

c. That pending interparties hearing the Application herein this Honorable Tribunal be pleased to issue an order of temporary injunction restraining the 2nd interested party from making any further salary deductions against the Applicant’s salary being TSC. NO. 315932;

d. That pending interparties hearing the suit herein this Honorable Tribunal be pleased to issue an Order of temporary injunction restraining the 2nd interested party from making any salary deductions against the Applicant’s salary being TSC. NO.315932; and

e. Costs of this Application be borne by the Respondent.

The Application is supported by the grounds on its face and the following Affidavit:

a. Supporting Affidavit sworn by the Claimant on 10. 8.2020;

b. Further Affidavit sworn on 30. 11. 2020.

The Respondent has opposed the Application vide the following Affidavits:

a. Replying Affidavit sworn by Joshua Kinuthia on 19. 1.2020; and

b. Further Affidavit sworn by the said Joshua Kinuthia on 3. 12. 2020.

The 1st Interested party responded to the Application vide the Replying Affidavit sworn by Christopher Ndoro on 8. 9.2020.

Vide the directions given on 14. 8.2020, the Application was canvassed by way of written submissions. The Claimant filed his submissions on 19. 1.2021 while the Respondent did so on 20. 1.2021.

CLAIMANT’S CASE

It is the Claimant’s case that he is a member of the Respondent. That his virtue of his membership, the 1st Interested Party advanced him a loan of Kshs.1,710,000/= in November 2011 for the purpose of purchase of a property with Respondent. That the loan was repayable for a period of 84 months commencing on 30. 1.2012.

That it was a term of the Loan Agreement that the said loan was to be recovered by way of monthly deduction directly from his salary with the 2nd Respondent.

That on 24. 7.2020, he received a demand letter from the Respondent asking to repay a loan balance of Kshs.1,556,314. 07/=. That does not know how this figure came about as he was of the impression that he had cleared his outstanding loan. That as a result of this, he was listed in the CRB.

RESPONDENT’S CASE

Vide the Replying Affidavit sworn by its Secretary, Joshua Kinuthia, on 19. 11. 2020 has opposed the Application on grounds that:

That the Respondent and the 1st Interested Party entered into an understanding whereby the respondent’s members would obtain loans from the 1st interested party upon the recommendation of the Respondent. That the procedure for securing the said loan begun with a member filling the respondent’s loan application form. That the Claimant followed this procedure whilst applying for his loan. That upon approval of the loan, the Claimant directed the Respondent on how the same would be disbursed. That he recommended two cheques No. 6427 kshs.718,093/= and No.6430 for Kshs.371,131/= to be disbursed to Equity Bank and his personal account respectively.

That he advised that part of the loan clears kshs.5280/= which was part of the loan arrears owed to the Respondent. That out of the loan, the Respondent was to be paid kshs.8550/= negotiation fee, Kshs.17,000/= negotiation fees for the 1st Interested Party and kshs.250 /= sinking fund.

That the loan was to be repaid by way of monthly installments of Kshs.33,206/= for 84 months.

That instead of paying the monthly installments of Kshs. 33,206/= the Claimant has been servicing the same by way of monthly installments of Kshs.24,000/=.

That is resulted in the loan falling into arrears amounting to Kshs.1,556,314. 00/= as of July 2020.

That the Claimant has deliberately and mischievously originated this suit so as to avoid paying the said loan.

That further, the Claimant has failed to disclose that between March- September, 2017, the 1st Interested Party raised its interest from 12. 5%to23%.

CLAIMANT’S FURTHER AFFIDAVIT SWORN ON 30. 11. 2020

Vide this Affidavit, the Claimant has controverted the averments made by the Respondent above. He contends that the Respondent has conceded that the loan with the 1st Respondent has been cleared. That by design the Respondent omitted to disclose that monthly payments from his salary are limited to 1/3 rule. That the Respondent and the 1st Interested Party, were aware of this. That parties engaged in negotiations and repayment increased to Kshs.25,000/= effect November 2013.

That the monthly repayment was limited to 1/3 rule and the respondent and the 1st interested party were aware of the fact. That it is thus fully for him to be blamed yet he has no control over the remittance of his salary. That the Respondent and the 1st respondent approved the loan with full knowledge that the remittance would not reach the require threshold.

RESPONDENT’S FURTHER AFFIDAVIT SWORN ON 3. 12. 2020

This Affidavit is s reaction to the averments in the Claimant’s further Affidavit sworn on 30. 11. 2020. Vide this Affidavit, the Respondent contend that the loan acknowledgement form which was duly signed the claimant showed the amount borrowed to be Kshs.1,710,000/=. That the same showed that it was to be repaid for a period of 84 months. That a calculation of monthly repayment shows it to be Kshs.33,206/=.

That at the time the loan was approved the Claimant had supplied a payslip which qualified him for the loan.

ISSUES FOR DETERMINATION

The Claimant’s Application dated 10. 8.2020 has presented the following issues for determination:

a.Whether the Claimant has established a proper basis for the grant of an order  a temporary injunction; and

b. Who should meet the costs of the Application?

TEMPORARY INJUNCTION

We have jurisdiction to make an order regarding temporary injunctions by dint of Order 40 of the Civil Procedure Rules. Order 40 Rule 1 (a) provides thus:

“ Where in any suit it is proved by Affidavit or otherwise –

(a) That any property in dispute in a suit is in danger of being wasted, damaged, or alienated by any party to the suit, or wrongly sold in execution of a decree, the court may by order grant a temporary injunction to restrain such act, or make such other order for the purpose of staying and preventing the wasting, damaging, alienation, sale, removal, or disposition of the property as the court thinks fit, until the disposal of the suit or until further orders.

Before exercising the above jurisdiction, we are guided by the Principles enunciated by the court in the case of Giella – versus- Cassman Brown [1973] EA. They include:

(a)  A prima facie case with a probability of success;

(b) Irreparable damage; and

(c) Balance of Convenience.

The court  in the case of Mrao Limited versus first American Bank of Kenya Limited (2003) eKLR explained what Constitute a Prima Facie case in the following terms:

“.......A Prima Facie case is more than an arguable case. It is not sufficient to raise issues. The evidence must show an infringement of a right and the probability of the Applicant’s case upon trial. It is a case which on the material presented, to the court, a Tribunal properly directing itself will conclude that there exists a right which has apparently been infringed by the opposite party as to call for an explanation from the latter......”

From the decision of the court in the Mrao case above, it is trite that for a party to establish existence of a Prima Facie case with a probability of success, he/or she must establish existence of a right which has been transpired so as to call for the other side to rebut. A question abounds as to whether the Claimant has established existence of the said right. It is  his case that the Respondent and 1st Interested Party continue  to deduct monies from him to allegedly repay a loan which he cleared long time ago. However, upon review of the material placed before us it is apparent that the Claimant applied for a loan of Kshs.1,710,000/= repayable for a period of 84 months. This means that the monthly repayment would be Kshs.33,206/=. The Claimant has conceded this fact but goes ahead to blame the Respondent and the 1st interested party for approving the said loan. We pause the question thus; why did the claimant agree to take the approved loan of kshs.1,710,000/= when he knew very well that his payslip would not accommodate a monthly deduction of Kshs.33,206/=? We find the Claimant’s assertions farfetched. The only conclusion we draw from his submissions is that he is a person who has come to court to seek an equitable remedy with unclear hands. We cannot countenance such kind of conduct. In simple terms, we are saying that the claimant has not established a prima facie case with probability of success.

CONCLUSION

In light of the foregoing findings, we dismiss the Claimant’s Application dated 10. 8.2020 with costs in the cause.

RULING SIGNED, DATED AND DELIVERED VIRTUALLY THIS 6TH  DAY OF MAY, 2021.

Hon. B. Kimemia Chairperson Signed  6. 5.2021

Hon. J. Mwatsama  Deputy Chairperson Signed  6. 5.2021

Mr. P. Gichuki  Member Signed  6. 5.2021

Tribunal Clerk Leweri

Nancy Njoroge for Respondent

No appearance for Claimant

Mention for Pre-trial directions

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

Mention 7. 6.2021. Notice to issue.

Hon. B. Kimemia Chairperson Signed  6. 5.2021