Kikuyu Dairy Farmers Cooperative Society Limited v Kung’u [2022] KECPT 226 (KLR)

Kikuyu Dairy Farmers Cooperative Society Limited v Kung’u (Tribunal Case 158 of 2021) [2022] KECPT 226 (KLR) (20 January 2022) (Ruling)

Neutral citation: [2022] KECPT 226 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case 158 of 2021

J. Mwatsama, Vice Chair, P. Gichuki & B. Akusala, Members

January 20, 2022

Between

Kikuyu Dairy Farmers Cooperative Society Limited

Claimant

and

David Kiangonyo Kung’u

Respondent

Ruling

1. The Application for determination is dated 12. 8.2021. The Same is brought under Order 51 Rule Civil Procedure Rule 2010, Section 77, 87 Co-operative Act, Rule 3,4,6,11 and 18 Cooperative Tribunal Rules.The Application seeks for Orders:a.That this Application be and is hereby certified urgent and service of the same be dispensed with at the first instance.b.That pending the interparties hearing of this Application, an order of injunction be and is hereby granted restraining the Respondent either by himself, his servants, his employees, his workers or agents from interfering in any manner with the properties known as Dagoretti/Thogoto 4084 and Dagoretti/Uthiru/451/45 belonging to the Claimant.c.That pending the interparties hearing of this Application, an order of injunction be and is hereby granted restraining the Respondent either by himself, his servants, his employees, his workers or agents from visiting and causing disturbance at the offices of the Claimant domiciled at the property known as Kiambu/Kikuyu trading centre/53d.That pending the hearing of this suit, an order of injunction be and is hereby granted restraining the Respondent either by himself, his servants, his employees, his workers or agents from interfering in any manner with the properties known as Dagoretti/Thogoto 4084, Kiambu/Kikuyu trading centre/53 and Dagoretti/Uthiru/451/45 belonging to the Claimant.e.That the costs of this Application be provided for.The Claimant /Applicant avers the Claimant is in business of buying dairy milk from farmers in kikuyu sub county in the course of business Claimant invested in general real property (i) Dagoretti/Thogoto 4084(ii)Kiambu/Kikuyu Trading Centre/53(iii)Dagoretti/Uthiru /451/45Claimant has grown trees in Dagoretti/Uthiru/4084 and erected a commercial building in Dagoretti/Uthiru/451/45 and runs its business on Kiambu/Kikuyu Trading Centre/53. Claimant further avers the Respondent is a farmer member of Claimant who served as its chairman between 7. 11. 14 and 23. 2.2016. After being voted out the respondent formed an amorphous group who are dormant in society with sole aim of destabilizing the operations of the Claimant.The Respondent ‘s activities have been disruptive and there are now several matters pending before the Tribunal on the same.The Respondent was expelled during the Annual General Meeting held on 6. 10. 2017 Min 5:2016 /2017 copy of minutes are attached.The Respondent has been illegally selling trees that are owned by Claimant grown on Dagoretti/Thogoto/4084 to the detriment of the Claimant.

2. The Respondent filed his response dated 25. 8.2021 on 27. 8.2021. The response alludes that the respondent is not a shareholder of Dagoretti plot 4084 and Maziwa House, Uthiru thus has no business being sued.However, he is a member of the Claimant society and he was stopped from delivering milk because he questioned the returns due to the farmers.That there was an alleged meeting on 23. 11. 2016 which was illegally constituted to remove the Respondent as chairman of the dairy.He avers Claimant is responsible for buying and sale of milk from farmers. Farmers who deliver milk to the claimant and shareholders of Dagoretti plot 4084 and Maziwa House, Uthiru have a stake in the Claimant.

3. That there is no such term as “dormant members” as the same is a nullify in law and claimant’s by laws.The Claimant uses the term to the members who no longer deliver milk to the dairy but have invested their money in the purchase of Dagoretti plot 4084 and Maziwa House, Uthiru.That between the year 1994 and 1998 the then members of the claimant raised funds through buying of shares to purchase Dagoretti plot 4084 to build a milk processing plant and a total of Kshs. 4,700,000/= was raised. The land cost Kshs. 1,600,000/= and remainder of Kshs. 3,100,000/= has never been accounted for. 26 years down the road the processing plant is yet to be constructed.The land as per the Respondent belongs to the members and Claimant only acted as a trustee.The Claimant planted trees and leased out Dagoretti plot 4084 without members approval. That he has never interfered with Dagoretti plot 4084 nor sold any trees.The Claimant is the beneficiary of sale of trees and collecting rent on the land which generates more than Kshs. 600,000/=.

4. That in 1995 the (shareholders bought Maziwa House, Uthiru and was renovated in 2013 with aim of members getting dividends. It generates annual income of Kshs. 1,000,000/= from rents. The money is never bankedThe Respondent was appointed with 4 others to pursue dialogue with the Claimant. The Respondent and Committee has over years written letters and visited Claimant’s office to which Claimant never response.Instead the Claimant has instituted various Criminal and Civil suits against the Respondent at Kikuyu Law Courts and the same are attached.On 14. 8.2020 the 2079 “dormant members” met at Kanjeru Public grounds and resolves number of issues[paragraph 32 Replying Affidavit]:a.To seek court order to stop the forth coming Annual General Meeting of the Claimant.b.To seek intervention of the National and County Government of Kiambu in resolving their grievances.c.To use other legal means to reclaim their properties.d.To continue engaging the Claimant for dialogue.e.To put caution on Dagoretti plot 4084 and all bank accounts.f.To be holding regular meetings of the shareholders.On 22. 10. 2020 the Respondent and his team obtained a court order from Kikuyu Law Courts stopping the Claimants Annual General Meeting slated for 30. 10. 2020 until shareholders are invited to the Annual General Meeting. The same was ignored by the Claimant.On 24. 2.2021 the Respondent’s Committee met at Kanjeru Public grounds which meeting was disrupted by the Claimant Chairman and other members of his Committee.

5. The Assistant County Commissioner Kabete advised Respondent to take the issue to the County Commissioner, Kabete.On 19. 4.2021 Deputy County Commissioner , Kabete wrote to director of Cooperative Kiambu County Government asking her to convene an urgent meeting between Claimant and Respondent letter attached.On 2. 7.2021 shareholders met again at Kanjeru grounds for briefing and resolved to open a bank account for Maziwa House and Dagoretti plot. The Respondent and other 2 members were mandated to open an account with unity finance and wrote letters to the tenants to start paying rent directly to the account. The Claimant then visited the tenants at Maziwa House, Uthiru confiscated the Respondent letters and opened the houses asking them not to pay through the Respondent Bank Account.The Respondent thus prays for :a.That the request to have the Respondent be barred from visiting, accessing the offices of the Claimant, Dagoretti plot 4084 and Maziwa house be dismissed since these are public properties owned by members and shareholders. The Respondent feels that this amounts to denial of his right as a member, and many illegal activities will likely happen during this time if there is no public watch.b.That pending the hearing of this Application, an order of injunction be granted restraining the Claimant either by himself, his servants, his employees, his workers or agents from managing, visiting, leasing and collecting rent from Dagoretti plot 4084 and Maziwa House.c.That the Claimant be ordered to convene an urgent meeting between himself, the Respondent and shareholders.d.That the Claimant be ordered to be inviting the Respondent and all the so called dormant members to the Annual General Meetings of the Claimant.e.The Claimant’s Advocate is ordered to recuse himself from this particular case since he is an active member 1541 of the Claimant and shareholder of Dagoretti/Thogoto 4084. This amounts to conflict of interest.f.That the Respondent be allowed to attend the hearing of the case with his lawyers.

6. The Applicant filed a Further Affidavit sworn on 12. 10. 2021 and stated the Respondent was expelled at the Annual General Meeting held in 6. 10. 2017. In response to paragraph 6,7,8 of Respondent Dagoretti plot 4084 and Maziwa House are owned by members of Kikuyu Dairy Farmers and Maziwa house members enjoy dividends every year however Dagoretti plot is undeveloped.Any dormant member is an inactive member who does not deliver milk for period of 6 months without notifying the office.That the Dagoretti plot members were 733 out of which 32 members were refunded /withdrawal membership. The remaining ….some still deliver milk to kikuyu dairy.The initial shareholder of Maziwa House Uthiru was 331 member after opening the board only 32 members bought shares.Special General Meeting of 9. 10. 2010 members resolved minimum share is 25 shares less than 25 to be refunded. Only 226 get dividends.The Claimant normally holds Annual General Meeting and account for Maziwa House are presented to members.

7. The Tribunal directed parties to file submissions. Claimant filed their submissions dated 12. 10. 2021 on 15. 10. 2021. the Respondent filed their submissions on…………..the issues for determination is:i.Whether the Claimants have proved their case to warrant an injunction against Respondent for property Dagoretti/Thogoto 4084 and Dagoretti uthiru /451/45 and Kiambu /Kikuyu trading centre /53. Injunction :Prima facie caseIrreparable harmBalance of convenienceThe case above is hurdled with allegations from both sides and it is not clear from the Affidavits where balance of convenience lies.Prima Facie Case was put by Applicant until the Respondent put in their response which raised weighty issues.There are issues to be determined and it might not be prudent at the manner to issue any orders against any party.Status quo to be maintainedWe order for the Respondent to file their Statement of Defence and witness statement and documents 14 days from today.Pre-trial directions on 14. 4.2022. Matter to be expiated.

RULING SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 20TH DAY OF JANUARY, 2022. PREPARED BY:HON. J. MWATSAMA DEPUTY CHAIRPERSON SIGNED 20. 1.2022MR. P. GICHUKI MEMBER SIGNED 20. 1.2022MR. B. AKUSALA MEMBER SIGNED 20. 1.2022Tribunal Clerk R. Leweri1. File to be consolidated with CTC.NO. 398 OF 20192. Report by Commissioner for Cooperative DevelopmentHON. J. MWATSAMA DEPUTY CHAIRPERSON SIGNED 20. 1.2022