Kimani v Menya Services Sacco Limited [2023] KECPT 1046 (KLR)

Kimani v Menya Services Sacco Limited (Tribunal Case E213 of 2021) [2023] KECPT 1046 (KLR) (Civ) (30 November 2023) (Judgment)

Neutral citation: [2023] KECPT 1046 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Civil

Tribunal Case E213 of 2021

BM Kimemia, Chair, J. Mwatsama, Vice Chair, B Sawe, F Lotuiya, P. Gichuki, M Chesikaw & PO Aol, Members

November 30, 2023

Between

Esmael Njihia Kimani

Claimant

and

Menya Services Sacco Limited

Respondent

Judgment

1. The matter for determination is an Amended Statement of Claim 21st September 2021 in which the claimant avers that he was a member of the respondent being number 20, and had 7 vehicles registered with the Respondent. The Claimant also avers that he had various savings, and investments made with the respondent. Around January 2018 he wrote a letter to withdraw some of the savings, which was not responded to prompting him to write a withdrawal letter to the Sacco on 24th September 2019. Despite this, he claims that he is yet to be paid his savings, investments and an overpayment he had previously made. The claimant therefore prays for :a.Refund of contribution (savings) and overpayment on the loans totaling Kshs. 1,676,984. 20/=.b.An order directing the Respondent to file financial statements of accounts with regard to its investment portfolio for the years 2018, 2019 and 2020 and payment of dividends due to the Claimant for the said years.c.Interest at court rate on prayer (a) above at court rates from 25. 12. 2019 when notice of withdrawal expired till payment in full and costs of this claim.d.Such further reliefs as this Honourable Tribunal deems fit to grant.The Claim is accompanied by a Witness Statement and Documents in support of the claim.

2. The Respondent filed a Statement of Defence dated 9th May 2021 in which it admitted that indeed the Claimant was its member. However, the Respondent claims that the investment the Claimant is claiming was not for the whole Sacco but was a private arrangement by some members. On the issue of savings, the Respondent is for the position that its members resolved to halt refunds to members pending the full payment of the Sacco loan by Family Bank. The respondent further responds that no other dividend has been declared by the Sacco since 2018.

3. During the hearing, only the Claimant testified. The Respondent did not testify. The Claimant adopted his witness statement,

4. Both parties filed their submissions. In their submissions, the Claimant reiterated their claim and urged the court to grant them their prayers. The Claimant urged this court to note that the Respondent has failed to comply with the order of this Tribunal dated 6th June 2023 which ordered the Respondents to file and serve Statement of Accounts for the Claimants for the years 2018, 2019,2020.

5. In their submissions, the Respondents maintained their position that they do not object that the Claimant had savings worth Kshs. 1,637,682/= in the Sacco, but the only challenge is that the Sacco resolved to halt the refund of savings as resolved in the members general meeting held in 2018.

6. The 2nd to 8th Respondents did not enter appearance nor enter file Analysis

7. The question before this Tribunal is whether the Claimant is entitled to the prayers sought in his statement of claim as against the Respondent. In answering this question, the Tribunal notes that it is not in dispute that the Claimant was a member of the Respondent. It is also not in dispute that the Claimant had savings of Kshs 1,637,682/= with the Respondents. What is in dispute is the loan overpayment, and the investment deposits that the Claimant claims he had with the Respondent. And so, the first question this Tribunal asks is whether the Claimant is entitled to a refund of his savings. The Claimant wrote to withdraw his shares on 29th January 2018 and he has filed a copy of the letter he wrote to the Respondent. This letter has not been controverted or denied by the Respondent. The Respondent Claims that the reason for denial is the resolution held in Annual General Meeting in 2018. The Claimant claims that the Annual General Meeting was held long after he sought to withdraw his shares. This Tribunal is inclined to believe him since the Respondent has neither denied this, nor provided the copy of the minutes of the Annual General Meeting that the resolution was passed. The Cooperative Societies Act at section 27 provides that;The Supreme authority of a Co-operative Society shall be vested in the general meeting at which members shall have the right to attend, participate and vote on all matters”Therefore, if the Claimant sought to withdraw his shares before the resolution, then the resolution can not affect the withdrawal unless otherwise stated, which was not stated.

8. The second question before this tribunal is on the overpayments and the investment option that the Claimant claims he had with the Respondent. The Claimant made an Application, and this Tribunal ordered the Respondent to file and serve Statement of Accounts for the Claimants for the years 2018, 2019, 2020. The Respondents failed to do this. In the Supervisory Committee Report submitted in the Annual General Meeting held in 30th May 2018 and filed by the Claimant, it is clear that the investments were a under a committee of the Respondent. This was clearly pointed out by the Minutes of the Respondent’s Annual General Meeting dated 24th May 2017 and also by the Claimant during the hearing. We find that the Respondent has neither denied these documents nor controverted the amount claimed by the Claimant.

9. No evidence was produced to support the overpayment claimed by the Claimant. However, the tribunal finds that the Respondents failure to comply with this Tribunal’s order dated 6th June 2023 and supply the Claimants Statement, leaves the Claimants claim on the same uncontroverted.

10. On the issue of dividends, this court agrees with the Respondent that these can only be awarded when declared and passed by members in a general meeting. In the absence of evidence of declaration and passing of dividends, this Tribunal is not in a position to decide what is the Claimant’s entitlement in the investment claim.

11. The upshot of the above is that we find merit in the Claimant’s claim. We order as follows:a.A refund by the Respondent to the Claimant of Contributions and overpayment on the loans totaling Kshs. 1,676,984/-b.Interests at court rates on (a) above from the date of filing suit until payment in fullc.The Respondent, within 14 days of this Judgement, to file with this Tribunal the by-laws guiding the investment portfolio as well as the accounts relating to the investment portfolio from the year 2018 to date, to determine what is entitled to the Claimant in the investment. In default of this, the Claimant to be given a full refund of his investment.d.Claimant is awarded costs of this Claim.

JUDGMENT SIGNED, JUDGMENT SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 30TH DAY OF NOVEMBER, 2023. Hon. Beatrice Kimemia Chairperson Signed 30. 11. 2023Hon. J. Mwatsama Deputy Chairperson Signed 30. 11. 2023Hon. Beatrice Sawe Member Signed 30. 11. 2023Hon. Fridah Lotuiya Member Signed 30. 11. 2023Hon. Philip Gichuki Member Signed 30. 11. 2023Hon. Michael Chesikaw Member Signed 30. 11. 2023Hon. Paul Aol Member Signed 30. 11. 2023Tribunal Clerk JonahMs. Murigi advocate for the ClaimantMs. Gachohi advocate holding brief for Mutua advocate for the Respondent.Hon. J. Mwatsama Deputy Chairperson Signed 30. 11. 2023