Kenya Com Rabbit Consortium Limited v Commissioner for Co-operatives [2017] KEHC 4364 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA

AT NAIROBI

JUDICIAL REVIEW NO.  168  OF 2017

IN THE MATTER OF AN APPLICATION BY KENYA COM RABBIT  CONSORTIUM   LIMITED FOR  ORDERS OF CERTIORARI  AND  PROHIBITION  UNDER ORDER 58(1),(2),(3)  AND  7  OF THE CIVIL  PROCEDURE  RULES  2010

AND

IN THE MATTER OF CO-OPERATIVE SOCIETIES ACT CAP 490 LAWS OF KENYA SECTION 35

AND

IN THE MATTER OF FAIR ADMINISTRATIVE ACTION ACT 2015  SECTIONS  3,4,5,6,7,8 AND  9

BETWEEN

KENYA COM RABBIT CONSORTIUM LIMITED ………..APPLICANT

VERSUS

COMMISSIONER FOR CO-OPERATIVES………….…..RESPONDENT

RULING ON LEAVE

1. The chamber  summons dated  31st March  2017  and  filed  in court on  6th April  2017 under certificate of  urgency  and  supported by statutory statement and  verifying  affidavit  sworn by Robinson  Kariuki the  Managing Director  of Kenya  Com Rabbit Consortium Limited  seeks  from this court:

i. leave of court to institute  Judicial Review proceedings  seeking  for  certiorari  to quash  the decision by the Commissioner for  Co-operatives  issuing   an  Agency notice to the  Co-operatives  Bank of Kenya  Gikomba  Branch to  collect  kshs  1,340,000 on behalf  of BI Mashinani Farmers  Co-operatives  Society  from A/C  No. [particulars withheld] being operated by the applicant;

ii. That leave  be granted to apply  for mandamus  compelling  the  Commissioner for  Co-operatives to  cause to be  put back all monies  so far collected  from the  said Bank  and  account held  by the applicant;

iii. That leave  granted do operate  as  stay  of the Agency Notice  pending   final determination  of this application; and  costs  of the application.

2. According  to the  applicant and as per its  affidavit   and  grounds  as argued  by its counsel Mr Munyao  on  26th April  2017, the proper   procedure   was not  followed  as  stipulated  in Section  35  of the Co-operatives  Societies Act  which requires  the  Commissioner to  first institute   proceedings before  the Co-operatives  Tribunal  for recovery  before issuing  Agency Notice.

3. That the Agency  Notice  was  being issued  on behalf  of  BI Mashinani  Farmers Co-operative Society  which  was   then not in   existence  at the time the money  was allegedly  collected  and  that the applicant was never  accorded  a  hearing before Agency Notices  were issued.

4. That  it is  the applicant  that  promoted the  formation  of the BI Mashinani Co-operative  society  and  that the  action by the respondent Commissioner violated  Article  47  of the Constitution, it  was  illegal, arbitrary and  malafides  and  has  paralysed  the  operations  of the applicant.

5. I have read Section 35 (2) of the Co-operative Societies Act Cap 490 Laws of Kenya.  Under  the Section  35, the   Commissioner may  institute  proceedings  for  recovery  of monies  due  to  a member  of a co-operative  society  where  such monies  have been  deducted  from a member  but not remitted to the  Co-operative  Society.  And in doing so, the Commissioner must first give notice.

6. The said Section 35(2) provides that the Commissioner may institute court proceedings for recovery of such monies but it is not clear whether such recovery must be preceded by a suit.

7. Nonetheless, the applicant  laments  that it   was never  issued  with notice   before Agency Notices  were issued  to the bank and that  the  Agency Notice  is arbitrary  and offends  the provisions of Article 47 of the Constitution on fair  administrative  act   and  the Fair Administrative Action Act.

8. At this  stage  the applicant  need not  delve  into the  merits of   its case but must  demonstrate that it has a prima facie  arguable case for indepth  investigations at the  substantive  stage.

9. In my view, the complaint by the  applicant  is  not  frivolous  and  therefore  I shall grant the leave sought to apply for Judicial Review  orders  sought  in the chamber  summons.

10. The main motion to be filed and served within 10 days from todate.  The interested party who is BI Mashinani Farmers Co-operative Society to be served as well.

11. On the prayer that  leave granted do operate  as  stay Order  53  Rule  4 of the Civil  Procedure Rules permits the court  granting  leave in  an application  for prohibition  and  certiorari  only,  to order that such leave  do operate   as stay.

12. In this case, the applicant seeks for leave for certiorari and prohibition.  The court can therefore order for stay.  The applicant complains that if the stay is not granted, its operations will be grounded; and therefore the application if successful will be rendered nugatory.

13. I agree that where money is concerned, the applicant may be grounded if it cannot access its funds.  It is for that reason  that I exercise  my discretion and  suspend the Agency Notice issued to the Co-operative  Bank, Gikomba  Branch by  the respondent, Commissioner of Cooperatives which   account is operated  by the applicant, until the  motion  once filed  is heard and  determined  or until further orders of this court  whichever  is the earlier.

14. Costs in the cause.  Mention of the main motion on 8th May 2017 for directions on the hearing.

Dated, signed and delivered in open court at Nairobi this 27th day of April, 2017.

R.E. ABURILI

JUDGE