Maina & 7 others v Commissioner for Cooperative Development & another [2024] KECPT 226 (KLR)

Maina & 7 others v Commissioner for Cooperative Development & another (Tribunal Appeal 1 of 2020) [2024] KECPT 226 (KLR) (7 March 2024) (Judgment)

Neutral citation: [2024] KECPT 226 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Appeal 1 of 2020

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

March 7, 2024

Between

Joseph Mwangi Maina

1st Appellant

Peter Ng’ang’a Ngahu

2nd Appellant

Jacinta Wambui Mwangi

3rd Appellant

Robert Mwangi Kimani

4th Appellant

Milka Wairimu Njoroge

5th Appellant

Jacinta Warutere

6th Appellant

Peter Ngoigo

7th Appellant

Teresia Wanja Mwangi

8th Appellant

and

Commissioner for Cooperative Development

1st Respondent

Mwiki PSV Sacco Limited

2nd Respondent

Judgment

Appellant Case 1. The Appellant case is based on the Memorandum of Appeal filed on 29. 6.2020 and one Amended on 11. 3.2022 and received on 25. 5.2022 plus the Appellants written submissions dated 30. 1.2024. In both the Memorandum of Appeal and subsequent written submission the Appellant has raised the following issues in support of the Appeal.i.The Commissioner for Cooperative Development erred in not including financial statements of the 2nd Respondent from 2013, the date of its registration.ii.The Commissioner for Cooperative Development erred for not acknowledging that the Appellants were heard which to the Appellants is against the rules of natural justice and the Constitution of Kenya 2010. iii.The Commissioner for Cooperative Development erred in law for not acknowledging the role of County Cooperatives Commissioner and Sub-County Cooperative Officer as the overseers of the Cooperative Societies in this Counties. They allege that the County Officers had not cited any mismanagement in the 2nd Respondent Cooperative.They allege that the Inquiry Officers were not conversant with the 2nd Respondent operations.iv.They allege the Inquiry Report is faulty since the audited accounts of the Respondent have never raised any issue with them.v.They allege the Commissioner for Cooperative Development erred in finding Appellants liable since they were not members of the Management Committee.vi.They allege that the cash Appellant are alleged to have misappropriated were their savings, allowances and legitimate dues from the Sacco.vii.The Inquiry Report failed to include the Supervisory Committee Report.viii.They allege they were not given time to make their presentations.ix.They allege the report was tainted and fraudulentx.They allege the Commissioner for Cooperative development lacked cogent reasoning.

2. In their written submissions the Appellants reiterate the views as enumerated in the Memorandum of Appeal.The Appellants pray for judgment in their favor against the Respondent as hereunder:i.Allow the Appellant’s Appeal and order that the Inquiry Report on the affairs of Mwiki PSV Sacco conducted in September 2019 was tainted, unconstitutional and the same is null and void.ii.Costs be awarded to the Appellants.iii.Any other relief this Honourable Tribunal may deem fit and just.

Respondent’s Case 3. The 2nd Respondent filed a Replying Affidavit dated 16. 10. 2023 and written submissions dated 11. 3.2022 in the two documents the Respondent replied to the Memorandum of Appeal as hereunder:i.The Inquiry Report was presented to the 2nd Respondent Special General Meeting on 18. 10. 2019 as required by law.ii.The report revealed some members of the 2nd Respondent, including the Appellants had misappropriated Kshs. 23,801,536/=.iii.The 1st Respondent the Commissioner for Cooperative Development subsequently recommended Surcharge for those revealed in the Inquiry Report.iv.The 2nd Respondent Special General Meeting of 18. 10. 2019 adopted the Commissioner’s for Cooperative Development ‘s recommendations to surcharge the Appellants.v.The 1st Respondent issued Intention to Surcharge on 3. 3.2020 to the Appellants, inviting them to provide written submissions explaining why they should not be surcharged as per Section 73 of Cooperative Societies’ Act.vi.On failure of the Appellants to respond, the 1st Respondent consequently issue Surcharge Orders on 28. 5.2020. The 2nd Respondent has reinforced his case by citing the relevant sections of law and making reference to a Cooperative Tribunal case between Richard Otieno and 2 others versus the Commissioner for Cooperative Development.The 2nd Respondent consequently prays for the dismissal of the Appeal.

Analysis Of The Case 4. The Appellants filed a Memorandum of Appeal and Appellants written submissions while the 2nd Respondent filed a Replying Affidavit and a written response submission.The case was not subjected to a hearing since the matter would easily be dispensed off through the written submissions.From the written submissions we find that Appellant has prosecuted their case citing the alleged errors committed by the Commissioner.Most of the issues raised by the Appellant are issues of how the Inquiry Report was conducted, or issues on process of conducting an Inquiry.The Appellants allege that the Inquiry Report was tainted unconstitutional and thus null and void.On their part the 2nd Respondent has filed documents to show the flow and legality of the Inquiry from the appointment Inquiry Officers, the conduct of the Inquiry Report the General Meeting approval, the redress window given by Section 74 Cooperative Societies’ Act and the subsequent issuance of Surcharge Orders.We observe the following:i.The Commissioner for Cooperative Development exercised his powers as enshrined in Section 73, 74 and 75 of Cooperative Societies’ Act and fully complied with provisions of the Act as regards Surcharge.ii.The Appellants had an opportunity to raise the issues they have raised in their Memorandum of Appeal during the Special General Meeting held on 18. 10. 2019 and the Intention to Surcharge window dated 3. 3.2020. There is no evidence that the Appellants filed any issues or responded to the Intention to Surcharge.The intention of the 30 days period to respond to the Intention to Surcharge is to provide a window of redress to those intended to be surcharged.

5. We observe that despite the Appellant focusing much on the process of carrying out the Inquiry, they complied to Section 74 of Cooperative Societies Act by filing their Appeal on time.

6. We note that the Appellant is inviting this court to give judgment to issues raised on the content of the Inquiry Report, how the same was carried out and the powers of the Commissioner for Cooperative Development as regards surcharge.At the onset we want to put the records straight, we are not investigators.The Commissioner for Cooperative Development is not restricted in terms of period to be covered by the Inquiry Report. He has discretion on the period of the Inquiry Report.As we make judgment in the Appeal we will be guided partly by our own judgment in Richard Otieno & 2 others versus Commissioner for Cooperatives Development where our position was and still is ..that we are not required to investigate the administrative action of the Commissioner for Cooperative Development as this mandate lies with High Court.

7. We have gone through the entire proceedings by both parties and we state that we are satisfied the procedure to surcharge the Appellants was adhered to.We are satisfied that the process leading to the issuance of Notice of Intention to surcharge and the Surcharge Order itself was done in compliance with the law.

8. We therefore dismiss the Appeal with costs.

JUDGMENTSIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 7TH DAY OF MARCH, 2024. Hon. Beatrice Kimemia Chairperson Signed 7. 3.2024Hon. Beatrice Sawe Member Signed 7. 3. 2024Hon. Fridah Lotuiya Member signed 7. 3.2024Hon. Philip Gichuki Member Signed 7. 3.2024Hon. Michael Chesikaw Member Signed 7. 3.2024Hon. Paul Aol Member Signed 7. 3.2024Tribunal Clerk JemimahMuchiri advocate for 2nd Respondent.No appearance for 1st RespondentNo appearance for AppellantHon. Beatrice Kimemia Chairperson Signed 7. 3.2024