Ethics & Anti-Corruption Commission v Evanson Thuo Waweru, Evanson Thuo Waweru t/a Era Two Thousand Enterprises & Evanson Thuo Waweru t/a Big Sale Superstore/Big Sale Chemicals [2017] KEHC 2397 (KLR) | Asset Preservation Orders | Esheria

Ethics & Anti-Corruption Commission v Evanson Thuo Waweru, Evanson Thuo Waweru t/a Era Two Thousand Enterprises & Evanson Thuo Waweru t/a Big Sale Superstore/Big Sale Chemicals [2017] KEHC 2397 (KLR)

Full Case Text

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT NAIROBI

ANTI-CORRUPTION & ECONOMIC CRIMES DIVISION

MISCELLANEOUS APPLICATION NO. 67 OF 2017

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

-AND-

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, 2003 AND SECTION 11(1)(J) OF THE ETHICS AND ANTI CORRUPTION COMMISSION ACT NO. 22 OF 2011 TO PROHIBIT THE TRANSFER OR DISPOSAL OF OR OTHER DEALINGS (HOWSOECER DESCRIBED) WITH ACCOUNT NUMBERS XXXXXXX AND XXXXX HELD AT BARCLAYS BANK OF  KENYA LIMITED, QUEENS WAY HOUSE BRANCH IN THE NAME OF ERA TWO THOUSAND ENTERPRISES AND BIG SALE SUPERSTORES/BIG SALE CHEMICALS RESPECTIVELY

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

VERSUS

EVANSON THUO WAWERU..................................1ST RESPONDENT

EVANSON THUO WAWERU T/A

ERA TWO THOUSAND ENTERPRISES ………....2ND RESPONDENT

EVANSON THUO WAWERU T/A BIG SALE

SUPERSTORE/BIG SALE CHEMICALS………..3RD  RESPONDENT

R U L I N G

1. The Applicant, Commission filed an experte Originating Motion dated 13th September 2017 under certificate of urgency under the Vacation Rules, under Section 56  Anti-Corruption &  Economic Crimes Act (ACECA) No. 3 of 2003andSection 11(j) EACC Act No. 22 of 2011.  The Commission sought in the main that:

1. ……(spent)

2. The court be pleased to issue an order to prohibit the Respondents jointly and severally, their agent, servants or any other persons from withdrawing, transferring, disposing or in any other way dealing with the funds held in the bank accounts listed below:

i. xxxxx held in Barclays Bank of Kenya Limited, Queensway House branch in the name of Era Two Thousand Enterprises;

ii. xxxxxx held in Barclays Bank of Kenya Limited, Queensway House branch in the name of Big Sale superstore/Big Sale Chemicals;

3. The orders shall subsist for a period of six (6) months.

The application was predicated on the grounds on the face thereof and the supporting affidavit of Geoffrey Kimutai Langat a Forensic Investigator with the Commission.

2. The matter was placed before the  Vacation duty Judge, Kimaru J on 14th September 2017, who duly certified it urgent and ordered inter alia that:

“(i) Prayer 2 of the application is granted pending hearing interpartes on 28th September, 2017 before the Anti-Corruption Division of the High Court.

(ii)  The Respondents to be served forthwith in any event within three (3) days of today’s date.”

Upon being served the Respondent filed a response to the application. The matter came up on 28th September 2017 as directed but the Anti-Corruption Division were not sitting, whereupon Ngenye J who extended the interim orders and directed that the matter be heard on 5th October 2017.  The matter came up for hearing  in the Anti-Corruption Division and was placed before me on the 5th October 2017 Learned counsel Mr. Kimeru appeared for the Respondent while learned State Counsel M/s Ndungu appeared for the Applicant Commission.

3. M/s Ndungu urged that it would be unprocedural for the Respondent to proceed on the Response as filed to the Commission’s application, since Section 56 (1) ACECAis clear that this application should be brought exparte .  Only after the orders are granted can the Respondent file a fresh application for discharge of those orders under Section 56(4).  Counsel argued that to allow the application to proceedinterpartes at this stage is to put the cart before the Horse and it would require her to file a response to the Respondent’s response as if she were responding to an application under Section 56(4).

4. Counsel relied on the case of EACC V Equity Bank Ltd and Anor. ACEC MISC. APP No. 25 of 2017,in which Ong’udi J found that applications under Section 56(1) ACECA are exparte in nature and that the filing of a response thereto was unprocedural.

5. Mr. Kimeru urged that the orders granted by Kimaru J on 28th September 2017 are not the orders envisaged under Section 56(1) because the orders under Section 56(1) last for six months.  His interpretation of the orders of Kimaru J which were to run for 14 days was that the Judge was not satisfied that there were reasonable grounds to grant the orders sought.  He argued that if the Applicant had any points of law to raise it should follow the right procedure.  Further that in the spirit of Article 159 of the Constitution the court should go to the substance of the application instead of questioning the manner in which the court had been approached.

6. The manner in which preservatory orders may be obtained in the High Court under the ACECA is not a mere technicality as it is a statutory provision under Section 56 ACECA which provides that:

“1. On an ex parteapplication by the Commission, the High Court may make an order prohibiting the transfer or disposal of or other dealing with property if it is satisfied that there are reasonable grounds to suspect 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.

4. A person served with an order under this section may, within fifteen days after being served, apply to the court to discharge or vary the order and the court may, after hearing the parties, discharge or vary the order or dismiss the application.

5. The court may discharge or vary an order under subsection (4) only if the court is satisfied, on the balance of probabilities, that the property in respect of which the order is discharged or varied was not acquired as a result of corrupt conduct.”

7. I therefore agree with the holding of Ong’udi J and it is as clear as pike staff that applications under Section 56 (1) are exparte in nature. To begin with and they shall have effect for six months.  Subsequently the court may extend them on application by the commission.  The party against whom the orders are made has a right to be heard and to challenge the said order.

8. It is however noteworthy that under Section 56(4) it is the order and not the application which shall be served upon the Respondent.  A person so served does not respond to the application whose orders have already been granted but may within 15 days “apply to the court to discharge or vary the order” and the court has the discretion upon hearing the parties, to discharge or vary the orders or dismiss this application.

9. As submitted by Mr. Kimeru the orders granted on 28th September 2017 are not the orders envisaged under Section 56(1) ACECA since they were to last for a period of 14 days only.  This court cannot however purport to assign to the judge what he did not put down on paper, by making an assumption that the judge found no reasonable grounds to grant the orders sought.  If that were the case the judge would have said so.

10. As submitted by M/s Ndung’u, to proceedinterpartes at this stage would be to put the Cart before the Horse and to put upon  her  the irksome burden of responding to a response as if it were the application under Section 56(4).   Indeed I have no hesitation in finding as did Ong’udi J in the case of EACC v Equity Bank (supra) that:

“The Applicant came before the Court exparte as provided for under ACECA and orders were issued.  Upon being served with the application and the orders the only way the Respondents could have challenged those orders was to approach the Court vide an application brought under Section 56(4) of ACECA.”

Since the misunderstanding was not  entirely a creation of the parties before the court, I went ahead to issue directions for the filing of an application under Section 56(4) before close of business on 5th October, 2017 and for the Applicant to respond thereto within 24 hours thereafter.

11. I have  also considered the Origination Motion together with the supporting affidavit and I am satisfied that the orders of preservation granted by Kimaru J on 14th September 2017 were merited, save that they should have been for six months.  To bring them in line with Section 56therefore, I make orders as follows:

i. Prayer No. 2 of the application dated   13th   September 2017 is granted.

ii. The order will remain in place for six months.

iii. Barclays Bank of Kenya Limited, Queensway House branch and the Respondent to be served with this order forthwith.

There are no order as costs.

It is so ordered.

DATED, SEALEDandDELIVEREDatNAIROBIthis6th day of October 2017.

L. A. ACHODE

JUDGE