Kimaru v Commissioner for Co-operative Development & another [2022] KECPT 210 (KLR)

Kimaru v Commissioner for Co-operative Development & another (Tribunal Appeal 33 of 2019) [2022] KECPT 210 (KLR) (Civ) (26 May 2022) (Judgment)

Neutral citation: [2022] KECPT 210 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Civil

Tribunal Appeal 33 of 2019

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

May 26, 2022

Between

Michael Kinyua Kimaru

Appellant

and

Commissioner for Co-operative Development

1st Respondent

Kukena Sacco Society Limited

2nd Respondent

Judgment

1. The appeal for determination is filed vide a Memorandum of Appeal dated December 16, 2019 filed on January 5, 2021. The appellant having been dissatisfied with the order of commissioner for cooperative development in CS no 8051 of 2019 dated November 19, 2019 appealed against the whole decision on the following grounds:1. That the commissioner for co-operatives erred in law and fact in making an order that the appellant is accountable for a sum of kshs 161,100/= or any at all as indicated against his name in relation to the business of Kukena Sacco Society Limited.2. That the commissioner for cooperatives erred in law and fact in finding that the appellant is liable to pay a sum of kshs 38,000/= out of the amount of kshs 380,000/=.3. That the commissioner for cooperatives erred in law and fact in failing to make a finding that the kshs 380,000/= was paid by one Paul Kithakaand banked at the sacco account, Cooperative Bank Kerugoya Branch.4. That the commissioner failed to make a finding that the CEO one Simon Ndiranguwas the one handling the amount of kshs 380,000/= on behalf of the sacco.5. That the commissioner failed to make a finding that kshs 360,000/= paid by one Charles Muriithi Gaturafor motor vehicle registration no KCE 085J was received by the CEO and was receipted.6. That the commissioner failed to make a finding that the chairman and vice chairman admitted having received the money hence they are responsible to repay the said amount of kshs 360,000/=.7. That the commissioner failed to make a finding that the appellant is not liable to pay kshs 72,000/= handled by the chairman and the vice chairman.8. That the commissioner failed to make a finding that the sacco is still holding the appellant’s unutilized vehicle deductions of kshs 19,000/= for the month of July, 2018 and kshs 15,000/= for the month of August, 2018 totalling to kshs 34,000/= and still held by the 2nd respondent.9. That the commissioner has failed to make a finding that the battery N70 purchased on July 23, 2018 had been paid for by the appellant vide receipt no 664 dated July 23, 2019 of kshs 7200/= making the total sum of kshs 44500/= held by the sacco society.10. That the commissioner failed to take into consideration the appellant’s submissions against the Notice of Intention to surcharge datedSeptember 9, 2019. 11. That the 2nd respondent failed to take into consideration the findings and recommendations of the Inquiry Report by unanimously adopting the findings and recommendations.12. That the commissioner failed to make a finding that the Appellant is not liable for any loss of money and should not be surcharged.The appellants prayers are thus for the appeal to be allowed and the order be set aside with costs.In the Record of appeal dated December 23, 2020 the appellant attached various documents as per the index namely:

No description of documents page no.1. Memorandum of appeal 1-32. Summons 43. Inquiry Report 5-494. Notice of Intention to surcharge dated August 29, 2019 50-515. Letter dated September 9, 2019 52-536. Letter dated September 17, 2019 54-557. Letter dated September 23, 2019 568. Letter dated November 19, 2019 57-589. Surcharge order dated November 19,2019 59-6010. Receipt no 664 dated July 23, 2018 6111. Bundle of daily collection receipts for the month of July 2018 62-8012. Bundle of daily collection receipts for the moth of august 2018 81-96

2. The 1st respondent that is the commissioner for cooperative development did not enter appearance or defend the appeal.However the 2nd respondent Kukena Sacco Society Limited opposed the appeal did not file away response but filed written submissions.The appeal was directed to be dispensed with by way of written submissions on July 26, 2021 and 2nd respondent despite not filing a response to oppose the appeal filed written submissions.The appellants written submissions were filed on August 2, 2021 filed on August 6, 2021 and 2nd respondent filed there written submissions dated November 15, 2021 on January 13, 2022.

3. Not to reiterate the grounds of the appeal the appellant states in paragraph 10 of Memorandum of Appeal commissioner did not take into consideration the appellant’s submissions against the notice of intention to surcharge dated September 17, 2019. We look into the said submissions dated September 17, 2019 and we note the appellant objected to the intention to surcharge.He was categorical in the following terms:a.Kshs 38,000/= the sum is derived from kshs 380,000/= paid by one of the members Paul Kithaka to boost shares and was received by the Chief Executive Officer and receipt issued.Appellant states he cannot be responsible for money he did not handle.b.Kshs 72,000/=- it is derived from kshs 360,000/= paid by a member Charles Muriithi for motor vehicle KCE 081J money was received by chief executive officer and receipt issued.Appellant did not handle in money thus he should not be surcharged for cash he did not handle.c.Kshs 51,000/= for batteries/tyres- Appellant claims to have no knowledge of the same.He stated they are allowed to pay for batteries and tyres in two ways that is cash or credit.If by credit kshs 1000/= is deducted daily from the operating motor vehicle. If he indeed owed any cash to the shop he should have been asked to pay for the same.

4. The respondent on the other hand vide their written submissions stated the Appeal has no merit and ought to be dismissed. The 2nd respondent stated a resolution was passed in special general meeting and members unanimously agreed/adopted the findings and recommendations of the inquiry report and appellant was to pay kshs 161,100/=.The respondents state the appellant is challenging the commissioner for cooperative development for being satisfied with the inquiry report without giving credible reasons why and how the report is erroneous.The 2nd respondent avers the findings in the inquiry report and explanation how the report was arrived as was detailed in the report. They invited the tribunal to scrutinize the inquiry report and findings which we shall do.The inquiry report is found on page 5 – 49 of the Record of Appeal. We shall deal with where the appellant has been implicated.Michael Kinyua Kimani was the 2nd respondent treasurer as at 2013 - 2018. Paragraph 3 of the inquiry report for procurement of tyres and lubricationPage 14 of the inquiry report the appellant is said to have a balance of kshs 15,000/=On August 3, 2018 – kshs 15000/= tyresJuly 23, 2018 – kshs 6800/= battery N70. August 8, 2018 - kshs 7500/=June, 2018 - kshs 6800/=August 13, 2018 - kshs 15,000/=On cash issue paragraph 3. 6 of inquiry reportThe report states the chief executive officer would ask for some cash for some emergencies thus the disparity in figures amount collected and banked.The only place the appellant was implicated is purchase of tyres and batteries from the report.The issue for determination then would be.

Issue oneWhether the commissioner took into consideration the submissions of the appellant.The appellant has indeed questioned why the commissioner for cooperative development found him culpable in matters that he did not participate and is clearly laid on who the parties involved were.

5. We agree with the appellant in terms of the monies received by the chief executive officer and he did not handle and yet the same is being subjected to him.This in our view is not right.After analysing the appeal, documents and written submissions by parties we find the only charge he ought to have been found culpable in is the tyres and battery.The 2nd respondent in the written submissions have referred us to several of our judgment and more so.Tribunal Appeal case no 8 of 2018. Felix Otende - vs- Commissioner for Cooperative Development & another[2021]

6. The above case is distinct from the present one as the aforementioned case dealt with the inquiry report and not the surcharge order which was aforementioned.To this end, we find the appeal succeeds partially and is allowed in terms of prayer 1,2,3,4,5,6,7,10. Prayer 8 and 9 fails.Costs and interest to be paid by respondent.

JUDGMENT SIGNED, DATED AND DELIVERED AT NAIROBI VIRTUALLY THIS 26TH DAY OF MAY, 2022. Hon J Mwatsama Deputy Chairperson Signed May 26, 2022Mr P Gichuki Member signed May 26, 2022Mr B Akusala Member signed May 26, 2022Tribunal Clerk NasiekuMathenge advocate for the respondentMichael Kinyua – No appearanceMathenge- We pray for 30 days stay of execution and copy of judgmentTribunal – 30 days stay granted.Hon J Mwatsama Deputy Chairperson signed May 26, 2022