Macharia v Bingwa Sacco Society Limited [2023] KECPT 843 (KLR)

Macharia v Bingwa Sacco Society Limited (Tribunal Case 836 of 2016) [2023] KECPT 843 (KLR) (21 September 2023) (Judgment)

Neutral citation: [2023] KECPT 843 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case 836 of 2016

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

September 21, 2023

Between

John Muchiri Macharia

Claimant

and

Bingwa Sacco Society Limited

Respondent

Judgment

1. The claim for determination is vide a Statement of Claim dated 07/11/2016 and filed on 29/11/2016. It is accompanied by a Verifying Affidavit dated 07/11/2016 and filed on 29/11/2016. The Claimant also filed a List of Documents and a Witness Statement both dated 07/11/2016 and filed on 29/11/2016.

2. The Respondent filed a Statement of Response dated 25/09/2016 and filed on the same date. Accompanied by a witness statement and a List of Documents both dated on 06/11/2018 and filed on the same day.

Claimant’s Case. 3. The Claimant called one witness CW1 who was the Claimant himself, John Muchiri Macharia. The Claimant adopted his witness statement dated 07/11/2016 as his Evidence- in -Chief. Further, he also produced his List of Documents as exhibits C-exh 1. He averred that indeed he took a loan from the Respondent that was payable in 36 months. The Claimant however insisted that he was to enjoy a 6- month grace period as one of the terms of the loan application. The Claimant further denies to be sent any remainders to pay the loan and insist the deposit made on 09/05/2012 was for the payment of the loan. The Claimant through the Statement of Claim is desirous that the auction done was illegal, null and void and an order ton have the land revert back to the Claimant.

Respondent’s Case 4. The Respondent called one witness RW1 Jeff Muchai Mwaniki. The Respondent requested to replace Jane Wanjiru as it was her witness statement on record with Jeff Mwaniki. The Claimant did not object. The witness adopted the witness statement dated 25/09/2016 as his evidence in chief. Further he produced his list of documents dated 06/11/2018 as exhibits R-exh 1-7. The witness avers that they indeed advance the Claimant a loan of Kshs 90,000/- as a loan facility payable in 36 months. He however, indicated that the Claimant never made any payment to the account for purposes of repayment. Further he denied any mention of 6 months grace period indicating that was never discussed nor was it indicated in the Loan Agreement. The witness testified that after several reminders to pay that went unanswered, they went ahead to procure the services of an Auctioneer to sell the Claimant’s property to realize the defaulted loan. It was after the auctioneering process that was done that money from the proceeds that was used to pay for the loan. He also indicated that, the Claimant deposited Kshs 90,000/- into the account after the auction was done. He however, withdrew the amount later on.

5. The parties were then instructed to file and serve written submissions. The Respondent filed theirs dated 03/08/2023 on 08/08/2023 while the Claimant filed his dated 30/06/2023 on 20/06/2023.

Analysis And Determiantion. 6. After perusal of the pleadings and written submission, it is the Tribunal view that the issues for determination are as follows;a.Whether the Tribunal has jurisdiction?b.Whether the Claimant was in default?c.Whether the Tribunal can make an order declaring the auction illegal null and void?

Issue One Whether the tribunal has jurisdiction? 7. On the first issue, the courts in Owners of Motor Vessel “Lilian’s” v Caltex Oil (Kenya) Limited held that jurisdiction is everything. That without it the courts should not make another step. Section 76 of the Co-operative Societies Act spells out the matters that the Tribunal may entertain. Being a matter of debt between a SACCO and a member over debt, this matter falls under the ambit of the Tribunal and therefore the Tribunal has the requisite jurisdiction to entertain it.

Issue Two Whether the claimant was in default? 8. On the second issue, both parties agree that indeed the Claimant was advanced a loan facility worth Kshs 90,000/= due in 36 months from the date of deposit. However, the borne of contention was the fact the Claimant is insistent that he was given a 6-month period and assertion the Respond vehemently opposes. The issue of a grace period should be term of the agreed and therefore should be indicated as so in the Loan Application Form. However, the same is not indicated in the Application Form produced by the parties. Moreover, he who alleges must prove. The Claimant has failed to prove that indeed that was a term they had agreed on. Further, the Claimant did not deposit any money to his account as expected on a monthly basis to indicate any intention that he was ready to pay the loan. It was the Claimant’s responsibility to meet his obligations as pertaining the loan agreement. It is therefore the Tribunal’s view that the Claimant indeed defaulted on his loan.

Issue Three Whether The Tribunal Can Make An Order Declaring The Auction Illegal Null And Void? 9. On the last issue, we will consider whether the auction was procedural. Section 96(2) of the Land Act provides for a 40-day notice to sell which must be issued before the auctioneer can take over the matter. Further Rule 15 of the Auctioneers Rule require the auctioneer to give the charge a redemption notice of not less than 45 days. Rule 15 (d) then requires that the auctioneer to arrange for sale of the property not earlier than 14 days from the first advertisement in the newspaper. From the evidence proffered by the Respondent the auction was scheduled three days after the advertisement in contravention to the Auctioneers Rules. Further no notice to sell was issued by the Respondent as is required by the Land Act. This will therefore render the process illegal and null.

Determination. 10. From the foregoing, the Statement of Claim is hereby dismissed for lack of merit with costs to the Respondent.

JUDGMENT SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 21ST DAY OF SEPTEMBER, 2023. ................HON. BEATRICE KIMEMIACHAIRPERSON................HON. J. MWATSAMADEPUTY CHAIRPERSON................HON. BEATRICE SAWEMEMBER................HON. FRIDAH LOTUIYAMEMBER................HON. PHILIP GICHUKIMEMBER................HON. MICHAEL CHESIKAWMEMBER................HON. PAUL AOLMEMBERTribunal Clerk - Jonah