Ethics & Anti-Corruption Commission v Equity Bank of Kenya & Charity Mueni Musyimi [2017] KEHC 2147 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT NAIROBI

ANTI-CORRUPTION & ECONOMIC CRIMES DIVISION

MISCELLANEOUS APPLICATION NO. 25 OF 2017

IN THE MATTER OF: ANTI-CORRUPTION AND ECONOMIC CRIMES ACT (CAP.65) AND ETHICS & ANTI CORRUPTION ACT (CAP.65A)

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IN THE MATTER OF: SECTION 180 OF THE EVIDENCE ACT (CAP.80)

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IN THE MATTER OF: AN APPLICATION BY ETHICS AND ANTI-CORRUPTION COMMISSSION FOR AN ORDER UNDER SECTION 56 OF THE ANTI-CORRUPTION AND ECONOMIC CRIMES ACT TO (CAP.65); SECTION 11(1)(J) OF THE ETHICS AND ANTI CORRUPTION COMMISSION ACT (CAP.65A), TO PROHIBIT THE TRANSFER OR DISPOSAL OF OR OTHER DEALINGS CONNECTED AND/OR INCIDENTAL TO EQUITY BANK KENYA LIMITED, MALINDI BRANCH, ACCOUNT NUMBER 04501194515735:-

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ETHICS & ANTI-CORRUPTION COMMISSION................APPLICANT

VERSUS

EQUITY BANK OF KENYA......................................1ST RESPONDENT

CHARITY MUENI MUSYIMI………..……………..2ND RESPONDENT

R U L I N G

1. By an application dated 9th June, 2017 brought under Section 56(3) of the Anti-corruption and Economic Crimes Act, the Applicant commission sought an extension of the preservation orders issued on the 13th of January, 2017 for a further period of four (4) months; thereby prohibiting the Respondents, by themselves or through their agents, servants or assigns from transferring, disposing of, wasting or in any way dealing with bank account number [particulars withheld] in the name of Charity Mueni Musyimi held by Equity Bank, Malindi Branch.

2. The application is based on the grounds that the Applicant’s ongoing investigations have established that the 2nd Respondent has corruptly acquired public funds from Kilifi County Government through unclear circumstances which call for the 2nd Respondents satisfactory explanation. The 2nd Respondent has however not provided the requested information nor has it recorded any statements. The Applicant has invited the 2nd Respondent on several occasions: on 16th January, 2017; on 5th May, 2017 and 29th May, 2017 to provide information and explanation and record statement over allegations of corrupt acquisition of Kshs. 11,047,000/=. The Application is supported by the Affidavit of Jacquilline Kimani dated 6th June, 2017 and the Supplementary Affidavit sworn by Taabu Lwanga dated 20th June, 2017.

3. This application is opposed by a Replying Affidavit sworn by Sarah Musyimi, and dated 12th June, 2017 in which Sarah Musyimi says as much and in particular, that the reasons disclosed in the affidavit of Jaquiline Kimani are not sufficient to warrant such extension. That the Applicant has produced no evidence or documents including bank statements as annexures in support of its claim. The 2nd Respondent denies declining to honor any of the invitations for interview by the Applicant and that the extension orders prayed for by the Applicant are tantamount to infringing on the 2nd Respondents right to property as provided for under Article 40 of the Constitution of Kenya.

4. The Applicant, in its submissions, indicated that its Application was based on the provisions of Section 56 of the Anti Corruption and Economic Crimes Act which state that:

“(1) On an ex parte application by the Commission, the High Court may make an order prohibiting the transfer or disposal of or other dealing with property on evidence that the property was acquired as a result of corrupt conduct.

(2) An order under this section may be made against a person who was involved in the corrupt conduct or against a person who subsequently acquired the property.

(3) An order under this section shall have effect for six months and may be extended by the court on the application of the Commission.”

5. The Applicant made reference to the case of Ethics and Anti Corruption Commission v Equity Bank Kenya Limited & Another (2017) eKLRwherein the court upheld the principle that investigations on corruption and economic crimes touch on public interest. Relying on the Affidavits sworn by Taabu Lwanga and Jacquiline Kimani, the Applicant indicated that the ongoing investigations have established that the 2nd Respondent acquired monetary assets through corrupt conduct and she is yet to explain the circumstances and basis under which she acquired the sum ofKshs. 11,047,000/=.

6. The Applicant submits that the 2nd Respondent has failed to honor invitations issued by the Applicant on the 16th of January, 2017, on the 5th of May, 2017 and 29th of May, 2017 so as to explain the source of the public funds in her account. She has not provided any documentation neither has she recorded any statements.

7. It is the Applicants submission that it has the legal mandate to promptly recover the established unexplained assets acquired by the 2nd Respondent through corrupt conduct if, upon conclusion of the Applicants ongoing investigations, it is established that the 2nd Respondent has failed to satisfactorily explain how she acquired the Kshs. 11,047,000/=. The Applicant makes reference to Article 79 and 252(1)(a) and(d) of the Constitution of Kenya, 2010 as read together withSection 11(j)of the Ethics and Anticorruption Commission Act and Sections 51,52,55 and 56Cof Anti Corruption and Economic Crimes Act in support of this.

8. The Applicant submits that it is reasonably apprehensive that unless the Preservation Order issued on 13th January, 2017 is extended, the Respondents herein may initiate and facilitate a withdrawal or transfer or in any other way, dispose of the funds deposited in the account, to the detriment of the State, the general public and the Applicant in discharge of its statutory duty and constitutional mandate in the fight against corruption and economic crimes.

9. The Applicant submits that the public interest consideration requires the Applicant to conduct exhaustive and conclusive investigations in a bid to establish whether or not the 2nd Respondent corruptly acquired Kshs. 11, 047,000/=in question, and urges the Court to extend the Preservation Order on the 2nd Respondents Bank Account for a further period of four months pending the conclusion of the Applicant’s exhaustive investigation.

10. The 2nd Respondents submissions make reference to Section 107 of the Evidence Act, which states that:

“(1) Whoever desires any court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts must prove that those facts exist.

(2) When a person is bound to prove the existence of any fact it is said that the burden of proof lies on that person.”

11. The 2nd Respondent also cites Section 109 of the Evidence Act which provides that the burden of proof as to any particular fact lies on the person who wishes the court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on any particular person. That based on the above mentioned sections of the Evidence Act that the burden of proof herein lies with the Applicant, who is required to prove that public funds were irregularly and corruptly paid into the 2nd Respondents bank account.

12. The 2nd Respondent relied on the cases of Ethics and Anti Corruption Commission v Johncele Insurance Brokers Limited Kisumu Misc. Application No. 178 of 2014andEthics and Anti Corruption Commission v Jimmy Mutuku Kiamba Misc. Civil Application No. 804 of 2014and submitted that the Applicant has failed to produce evidence to the effect that it has made progress in its investigations against the 2nd Respondent. The Respondent argues that the investigations have been ongoing for eight (8) months and there has been no significant progress, no statements recorded and no significant documentary evidence has been adduced to show that the moneys in the 2nd Respondents account were obtained through corrupt dealings. The Respondents therefore urge the Court to dismiss the Application as the Applicant has failed to prove their case against the 2nd Respondent.

Determination:

13. This Court has taken into consideration the application, the response thereto, the submissions of the respective parties and the authorities cited. The issue for determination here is whether sufficient reasons have been provided by the Applicant commission to warrant an extension of the preservation orders.

14. In the Affidavit sworn by Jacquiline Kimani on 6th June, 2017 she indicates that the 2nd Respondent has been called upon by the commission several times to provide information. Invitations were extended on 16th January, 2017; on 5th May, 2017 and on 29th May 2017 all of which the 2nd Respondent did not honour. The 2nd Respondent has given reasons as to why she has not been in attendance and indicates that the letters of invitation went directly to their advocates and not directly to 2nd Respondent.

15. The advocates of the 2nd Respondent did attend a meeting on 30th January, 2017 however, the relevant officers of the commission were not available and the meeting was deferred to 1st February, 2017. The invitations to the Respondent on the dates of 5th May, 2017 and on 29th May 2017 were not honoured by the 2nd Respondent.

16. It is in the interest of justice to determine whether the moneys acquired by the 2nd Respondent from Kilifi County Government were rightly acquired and whether the Respondents are culpable of any corruption or economic crime. This can only be determined if the Applicant is given an opportunity to complete its investigations. It is the finding of the Court that the purpose of the investigations will be defeated if this Court fails to grant the orders sought by the Applicant for the extension of the preservation orders. On the other hand the Commission should be as quick in its investigations as it is in pursuing orders of preservation. It must be remembered that the presumption of innocence operates in favour of the 2nd Respondent since they have not been tried and convicted nor has the Applicant established any culpability on their part yet.

17. The Applicant has been conducting investigations for the past eight (8) months and must either conclude them or demonstrate that they are of such a complex nature as to require more time. I therefore allow the Application and extend the Preservation order dated 13th January, 2017 limited only to four (4) months from the date of the expiry of the initial preservation order granted on 13th January, 2017 enable the Applicant conclude its investigations.

DATED, SEALEDandDELIVEREDatNAIROBIthis3rd day of November, 2017.

L. A. ACHODE

JUDGE