Irene Adhiambo v Transcom Sacco Limited [2021] KECPT 513 (KLR)

REPUBLIC OF KENYA

IN THE CO-OPERATIVE TRIBUNAL

AT NAIROBI

TRIBUNAL CASE NO.100 OF 2018

IRENE ADHIAMBO.......................................................................CLAIMANT

VERSUS

TRANSCOM SACCO  LIMITED ............................................  RESPONDENT

RULING

Vide the Application  dated 22. 10. 2019, as amended  on  28. 2.2020 the Decree Holder has moved  this Tribunal  seeking  for the following Orders:

1. That  this Honourable  Tribunal  be pleased  to issue  an Order  for attachment  of the  sums of money Kshs.166,156. 43/= held  by the Garnishee  (Co-operative  Bank,  Co-operative  House  Branch), Account  Number 01120000602800, in the name of  the Respondent/ Judgment  Debtor  herein in full satisfaction  of the decree  herein together  with the costs  of the garnishee  proceedings  and incidental  costs herein;

2. That the costs of this Application  be  provided for.

The Application is supported by the grounds on its face and the  Affidavit  sworn by  Decree Holder  on  22. 10. 2019. The Judgment  Debtor has  opposed  the Application by filing a  Replying  Affidavit  sworn by its Manager  Maina Nyaga on 27. 10. 2020.

Vide  the  directions  given  on  28. 7.2020,  the Application  was canvassed  by way of  written submissions.  The Decree Holder  filed  hers on  14. 9.2020 while  the Judgment Debtor did so  on   14. 11. 2020.

Decree  Holders  Contention

Vide the instant Application  the Decree Holder contends  that  it has a decree against  the Judgment Debtor  which remains  unsatisfied yet the Garnishee,  holds  funds on behalf  of the Judgment Debtor. That  the said decretal  amount  is kshs.166,156. 43. The Decree  Holder  therefore prays  for the said funds  to  be attached  in satisfaction  of the Decree.

Judgment  Debtor’s Contention

Vide  the Replying  Affidavit sworn  by its Manager on  27. 10. 2020,

The Judgment Debtor  has opposed  the Application  on grounds  that the decree being enforced is  founded  on  fraudulent  and false  accounting.  That prior  to obtaining  the said decree,  the Decree  Holder  concealed  material  and  crucial facts. That the  following  facts obtain  as far as  this  matter is concerned;

a.  That the Claimant’s  total  contribution  in the Respondent before resignation  was  Kshs.195,300/=.

b. That she withdrew  kshs.50,000/= through  cheque  No. 051987.

c. That  the Claimant  obtained  a loan  of  kshs.21,500/=which  she acknowledged  at paragraph  5  of her  statement  of  claim.

d. That she  failed  to deduct  the following  withdrawals from her shares.

Total  shares Kshs.195,300/=

Less  withdrawal  of Kshs.50,000/=

Less advanced on 15. 11. 2017

Less  interest  on the loan Kshs.3,225/=

Less institutional shares (Kshs.5000/=)

Less  instruction fees

Net balance  Kshs.114,525/=

That  the Claimant  falsely accounted  to the Tribunal  and  obtained  a decree  for kshs.223,343/-

That  subsequently, the Judgment  Debtor  made the following  payments  vide  the Claimant’s  Advocate  on record:

a. Kshs.128,475/= vide  cheque  NO. 0528718 dated 2. 10. 2018;

b. Kshs.  66,525 vide cheque  No.  053565 dated  16. 1.2020;

That  out of her total  share contribution  of kshs.195,300/= she  was paid Kshs.50,000,  21,550,3,225,128,435 and 66,525/= totaling  to kshs.269,775/=.

That  under oath  the Claimant  and her advocate  on record  lied to the Tribunal  and obtained  a Decree  based   on  fraudulent  concealment  of facts.

That further lied  that the  Respondent  had not filed and served a statement of Defence yet the same was filed  within  the  requisite  timelines.

That based on the foregoing,  the Tribunal  should open  these proceedings  to allow  the Judgment  Debtor  to file  a  counterclaim  against  the Decree Holder.

Issues  for determination

The Decree Holder’s  Application  dated  22. 10. 2019 has presented  the following  issues for determination:

a. Whether  the Garnishee  Co-operative  Bank of  Kenya holds money  in favour of the Judgment Debtor so as  to satisfy the Decree  against  it?

b. Who should  meet the costs  of the  Application?

Garnishee  Proceedings

Order  23 of the Civil  Procedure  Rules  govern  Garnishee  proceedings.  It provides  under  Rule  (3) thus:

“ A court  may  upon the  ex-parte Application  by the Decree  Holder  and  either before  or after  an oral examination  of the Judgment Debtor,  and upon Affidavit  by the Decree Holder  or his advocate  stating  that a Decree  has been issued  and  that it is still unsatisfied and to what amount,  and that another  person is indebted  to the judgment Debtor  and is  within  the jurisdiction, Order  that  all  debts ( other than the salary  or allowance coming  within provisions of  Order  22 Rule  42  owing  from such third person

(hereinafter,  called the  Garnishee) to the  Judgment Debtor shall be  attached  to answer  the Decree together  with the costs of Garnishee  proceedings and by the same  or any subsequent Order  it may be ordered  that the  Garnishee shall appear  before  the court  to show  cause why  he  should  not be ordered  to pay  the decree  holder  the debt  due to  him  to the Judgment debtor  or so much thereof as may be sufficient to satisfy the decree together  with  costs aforesaid.....”.

What  we gather from this  provision is that for Garnishee  proceedings  to succeed,  the Decree Holder  must  demonstrate  that the Garnishee  is indebted to Judgment Debtor and that  the said Garnishee  holds  certain funds  to the Judgment Debtor.

The Court  in the case o  Ecobank  Limited –vs-  True  North  Construction  Company  Limited  & Another  [2018] eKLR said this about  Garnishee  proceedings:

“ The object  of Garnishee  proceedings  is to enable  the Decree  Holder  to ...............a debt  due to  the Judgment  Debtor  from  the Garnishee  as may  be sufficient  to satisfy  a Decree. Crucial  thereof is that  the Garnishee  is indebted  to the judgment Debtor.”

Taking  cue  from the  decision  of the court in the Ecobank’s case  above,  we  pause and ask  whether  the Garnishee  herein holds  a debt  on behalf  of the Judgment  Debtor.

We note  that the Garnishee, Co-operative  Bank  of Kenya  was served with the instant Application on 16. 10. 2020 as per  Affidavit  of service sworn  by Victor  Mulanga  on  even  date (  16. 10. 2020). Despite  this service,  the Garnishee  did not participate  in these proceedings. Thus  in the absence  of  any  rebuttal,  we agree  with the Decree  Holder  that  the Garnishee  holds funds  in favour  of the Judgment  Debtor  sufficient  to satisfy  the Decree.

We have  noted  the Response and submissions  of the Judgment  Debtor. We find  that the same are  not relevant  to the Application before us.  While  the  Judgment  Debtor’s  Response  an submissions  revolves around  re-opening  of  the claim,  the instant Application  is purely  executory  in nature.  At  this stage,  we are not allowed  to go beyond  the provisions  of Order 23 of  the Civil  Procedure Rules.  If the  Judgment  Debtor,  desires  to re-open  these proceedings, then it should  follow the usual  channels/route to do so.

Conclusion

The upshot  of the foregoing  is that  we find  merit in the Decree  Holder’s  Application dated  22. 10. 2019, as  amended on  28. 2.2020and allow  it with  costs  to the Decree Holder.

Ruling signed, dated and delivered virtually this 7th day of  January,  2021.

Hon. F. Terer    Deputy Chairman ................................

Mr. P. Gichuki   Member    .................................

Mr. B. Akusala    Member   ..................................

In the presence  of  Mr.  Andati  for Decree Holder

Judgment Debtor absent

Court clerk  Maina

Hon. F. Terer    Deputy Chairman Signed  7. 1.2021