Mamadi v Shisanya [2025] KECPT 352 (KLR)

Mamadi v Shisanya (Tribunal Case 382/E450 of 2022) [2025] KECPT 352 (KLR) (Civ) (26 June 2025) (Ruling)

Neutral citation: [2025] KECPT 352 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Civil

Tribunal Case 382/E450 of 2022

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

June 26, 2025

Between

James Mamadi

Claimant

and

Benard Shisanya

Respondent

Ruling

1. This judgment emanate from a guarantor who is the Claimant in the instant case who had guaranteed the Respondent who was a member of the same Sacco with him.

2. When the Respondent failed to repay the loan, the Sacco recovered Kshs 622,664/= from the Claimants’ deposits held in the Sacco as a guarantor.

3. Resulting from the insistent inability of the Respondent to pay back the money to the Claimant after being notified the claimant filed a Statement of Claim dated 23rd June 2022 and attached a Verifying Affidavit, a Claimant List of Documents and List of Witnesses.

4. Without any response from the Respondent and for almost 4 months the Claimant filed an Application dated 6/10/2022 and requested for a judgment, cost and interest for lack of filing of a Defence.

5. The Tribunal Considered the request and entered summary judgment on 3/11/2022 in Favor of the Claimant against the Respondent for payment of Kshs 622,664/= plus cost in interest.

6. In the follow-up of the process of Execution on 8/3/2023 the claimant extracted a decree which according to the respondent witness statement, he stated that “ I had a story from my friend talking about this case in the Cooperative ribunal in Nairobi which I was not aware or even informed about it.”

7. However the respondent filed a Statement of Defence dated 26/6/2023 and further filed a Notice of Motion dated 8/5/2023 seeking to set aside the judgment dated 3/10/2022 stay of Execution of the judgment and be granted leave to file his defence.

8. This Notice of Motion was disposed of by the Tribunal by allowing prayer b and d vide an order dated 20th June 2023 when the matter came up for pre-trial Direction on 12/9/2023 the Respondent sought leave to enjoin his previous employer.

9. By chamber summons application dated 23/1/2024 the Respondent enjoined Bizone Limited and stated that they deducted money from his salary and failed to remit to the Sacco to defray his loan.

10. The Chamber Summons's Application came up for hearing on 7/5/2024 and because the respondent failed to attend the hearing the tribunal dismissed it with no oorders as to cost as if that was not enough the Respondent filed another Chamber Summons Application dated 20/8/2024, this time round, he enjoined Bizone Limited and Lompasaqo Sacco seeking to be granted leave to issue and serve a 3rd party notice on them.

11. While giving directions on the above Application the Tribunal ordered that his employer (Bizone ltd) cannot be brought to the Tribunal because of jurisdiction.

12. In the end, by consent to the parties agreed to prosecute the case by filing written submissions and have a full hearing.

Issues for determination 13. Having read through the Claimant’s and Respondent’s Applications, examined the evidence attached on the decisions of the Tribunal, we isolate two issues for determination .a)whether the respondent is liable to pay back the claimant Kshs 622,664 which was recovered by the Sacco from his share deposits has a guarantor ?b)who shall meet the cost of the suit ?

Analysis 14. It is not in dispute that the both the Claimant and the Respondent are members of the lomposaqo Sacco, it is further not in dispute that the Claimant was one of the guarantors who was approached by the Respondent to guarantee him for a loan that he took from the Sacco.

15. When the Tribunal granted a summary judgment in favor of the Claimant and the Respondent filed a Notice of Motion to have it set it aside, the Tribunal considered the prayers of the Respondent and invoked the provisions of order 10 rule 11 which provides as follows:“Where judgment has been entered under this order, the court may set aside or vary such judgment and any Consequential Decree or Order upon such terms as are just"

The Tribunal arrived at the decision based on a belief that the Respondent had credible Defence. 16. However upon reading the Statement of Defence dated 26th June 2023, the Respondent dwelt on denials save for paragraph six where he stated that he serviced his loans through check off system without providing evidence as to how much he claims to have repaid.

17. Reading through the grounds contained in the notice of motion and chamber summons applications, the respondent keep shifting blame to his former employer for failure to remit Kshs 364,858/= that was allegedly deducted from 2018 to 2020 and not remitted to lompasago Sacco to defray is outstanding loan.

18. During cross-examination at the hearing, the respondent confessed that the loan he took from the Sacco was not fully paid and did not have a clue on what was the balance as at the time he was rendered redundant.

19. Attempting to include Bizone limited and lompasago in the third-party application was misplaced because section 76 of the cooperative society’s act provides for who can appear before the tribunal section 76 providers follows:“Section 76 of the Co-operative Societies Act Provides as follows:1. 1. If any dispute concerning the business of a Co-operative society arises:a.Among members, past members and persons claiming through members, past members and deceased members; orb.Between members, past members or deceased members, and the society, its committee or any officer of the society; orc.Between the Society and any other Co-operative Society, it shall be referred to the Tribunal.2. 2. a dispute for the purposes of this section shall include-a.a claim by a Co-operative Society for any debt or demand due to it from a member or past member, or from the nominee or personal representative of a deceased member, whether such debt or demand is admitted or not; orb.a claim by a member, past member or the nominee or personal representative of a deceased member for any debt or demand due from a Co-operative Society, whether such debt or demand is admitted or not;c.a claim by a Sacco Society against a refusal to grant or a revocation of licence or any other due, from the authority.”

20. Justifiably, the tribunal dismissed the third-party application because BIZONE limited is not a Sacco or a society or a cooperative Union. on this, guidance was drawn from the provision of Rule 15 of the cooperative tribunal( practice and procedure) rules 2009 which provides as follows:“Subject to section 76 of the Act, the tribunal shall have a discretion to add or strike out parties to the claim" (Emphasizes ours)As a result, the tribunal saw it fit to dismiss the Respondents’ propositions to bring on board a party to whom the Tribunal has no jurisdiction over it.

21. Further, it was noted that the Sacco had deducted their money from the guarantors as per the terms provided in the loan application form. therefore they have nothing to do with the instant case.

22. The blame on Lompasaqo Sacco for failure to seek assistance from the commission of cooperatives to compel the respondent’s employer to remit the money detected from him under section 35 is an allegation which need proof.

23. We note that the Respondent did not call a witness from the lumbasaco Sacco to come and give evidence for the failure this then remains as an allegation and the tribunal wish to live it as such better Still the tribunal questions how the respondent knows whether the Sacco reported to the commission of cooperatives or not.

24. It is noted from the Respondent’s Chamber Summons Application dated 20th August 2024 that the Sacco released a statement on 20th February 2020 that the employer had deducted through check off system several employees monies but failed to release to the Sacco. this was a good gesture by the Sacco which would have made the concerned employees which included the respondent to hold a meeting with the employer with an objective of reaching a settlement of how the deducted monies would be paid to the Sacco under paragraph five of the Claimant’s Statement of Claim we note that the Claimant made several attempts to approach the Respondent to refund him the amount which was deducted by the Sacco to satisfy the loan defaulted by him, the Respondent did not deny this in this regard the Tribunal has no reason to deny the Claimant the right to be refunded by the Respondent the amount that was deducted from his account .

25. Regarding the argument that the employer that is Bizone ltd should indemnify the respondent for any liability that may be found against him. this tribunal has pronounced itself to the effect that we have no jurisdiction simply because the employer(Bizone Limited) is not a member or a past member of a Sacco as provided under section 76 1a b and c of the Cooperative Tribunals Act .

25The Respondent argument therefore fails Tribunal cannot be of any help to him.

26. Finally, having analysed the facts as they are and evidence on record, we find that the Claimant was deducted Kshs 622,664/= by the Sacco to repay the Respondent’s loan.

27. We further find that the Respondent’s Defence and argument do not sit well with the terms of the Loan Application Form and the Sacco’s Credit Policy.

28. Consequently, we hereby enter judgment in Favor of the Claimant against the Respondent for the refund of Kenya Shillings 622,664/= plus cost and interest at Tribunal’s rate from the date of this judgment until payment is made in full.

JUDGMENT SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 26TH DAY OF JUNE, 2025. HON. J. MWATSAMA DEPUTY CHAIRPERSON SIGNED 26. 6.2025HON. BEATRICE SAWE MEMBER SIGNED 26. 6.2025HON. FRIDAH LOTUIYA MEMBER SIGNED 26. 6.2025HON. PHILIP GICHUKI MEMBER SIGNED 26. 6.2025HON. MICHAEL CHESIKAW MEMBER SIGNED 26. 6.2025HON. P. AOL MEMBER SIGNED 26. 6.2025Tribunal Clerk GechikoNo appearance by partiesJudgment delivered in absence of parties.