MRS Sacco Limited v Kinyanjui [2024] KECPT 1413 (KLR)

MRS Sacco Limited v Kinyanjui (Tribunal Case 638 (E686) of 2023) [2024] KECPT 1413 (KLR) (29 August 2024) (Ruling)

Neutral citation: [2024] KECPT 1413 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case 638 (E686) of 2023

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

August 29, 2024

Between

NRS Sacco Limited

Claimant

and

Joseph Gichanga Kinyanjui

Respondent

Ruling

Brief facts 1. The Respondent is a member of the Claimant having membership No. 410387. On 20th December 2018, the Claimant disbursed a loan of Kshs. 473,300/= to the Respondent.Over time under paragraph 6 of the Claimant’s statement the Respondent made some repayment and in the course of time he stopped the repayment.

Claimant’s Case 2. The Claimant filed a Statement of Claim dated 15th September 2023 and sought for the following orders:a.An order to direct the Respondent to pay Kshs 681,657. 06/= being loan balance and interestb.Costs of the suitc.any other or further orders deemed appropriate in the circumstances

3. In support of the claim, the Claimant’s filed Verifying Affidavit, Witness Statement, List of Witnesses and a List of Documents which include the Respondent’s Loan Statement Account.

4. The Statement of Claim and attached documents were served upon Respondent. An Affidavit of Service dated 23/10/2023 which was sworn by Lewis Gicheha was filed in the Tribunal on 23/10/2023.

5. Upon the receipt the Respondent filed a Memorandum of Appearance Application dated 3/11/2023 and failed to file a Defence not only within 14 days as provided under Order 7 Rule 1 of the Civil Procedure Rules which provide as follows :“Where a Defendant has been served with summons to appear he shall, unless some other further order be made by court, file his Defence within 14 days after he has entered an appearance in the suit and serve it on the Plaintiff within 14 days from the date of filling the Defence and file an Affidavit of Service.”

6. On 20/12/2023 the Tribunal entered summary judgment in favor of the Claimant against the Respondent for payment of Kshs 681,657. 06/= plus costs.

7. Bricked by this summary judgment the Respondent filed a Notice of Motion dated 19th January 2024 under a Certificate of Urgency and sought for the following orders:a.Spentb.That the summary judgement entered on 20/12/2023 be set aside and the respondent be given unconditional leave to defend this suitc.That there be stay of execution of the judgment entered on the 20/12/2023 pending the hearing and determination of the Applicationd.That the Respondent be granted leave to enter appearance and file a Defence out of time and the annexed copies of the Defence be deemed as duly filed. Upon payment of the requisite fees.e.That costs be provided for.When the matter came up for mention on 10/5/2024 the Tribunal ordered that Application to set aside the summary judgment be canvassed by way of written submissions.

Analysis 8. We have analyzed the Claimants and the Respondents together with Witten submissions and isolated three (3) issues for determination:a.. Whether the summary judgment entered on 20/12/2023 was regular or irregular?b.Whether this summary judgment can be set aside and the Respondent be granted leave to file his Defence out of time?c.Who should pay the cost of application?Whether the summary judgment entered on 20/12/2023 was regular or irregular?

9. To answers this question, we draw our attention to Order 10 rule 4 and 6 of the Civil Procedure Rules which provide that interlocutory judgment on apportionment of liability if liquidated demandsHowever, the Civil Procedure Rules give 2 incidents where an Interlocutory Judgment may be tampered with by the court.a.Irregular judgment this where service of summons to enter appearance was inadequate or the respondent was properly served with summons to enter appearance in such a case the default judgement will be set aside ex-debito justiciae as a matter of right.However, In the instant case the Respondent was served with summons and there is an Affidavit of service record.Further, the Respondent has not disputed the service in his Draft Defence or on his written submissions. At the same time, the Respondent avoided to mention anything to do with the irregularity of the judgment in both the Draft Defence and written submissions but instead dwelt on the other frolics with bordered on blaming his advocates for not taking his instructions seriously.

10. The only place where we came across the word irregular judgment is on paragraph 5 (b) in the Respondent’s Notice of Motion Application dated 19/1/2024 which read:“That the judgement herein is irregular and therefore highly prejudicial and in furious to the respondent’s and his interest.”We have tried to find the explanation of the irregularity of the judgment from the Draft Defence filed by the Respondent and find NONE.Given that a summary judgment may be obtained without the merit and complement of a full trail, it must not be lost to the parties that the provisions of Orders 5 of the Civil Procedure Rules 2010 must be adhered to. Needless to mention, summons play a critical role of inviting the other party to state his/her case in line with the principal of natural justice. The Respondent in the case was served and therefore any claim that the summary judgment entered was irregular is a misplaced statement of fact.b.Regular JudgmentThis is where service of summons was effected and some reason the Respondent failed to enter appearance or to file a Defence upon moving the court under order 10 rule 11 of the Civil Procedure Rules, it is found out that the respondent has arguable Defence and has compelling reasons as to why the same was not was filed in time.In such a case the court has unfettered discretion to set aside the default judgment. This is different from the instant case where the Respondent’s Draft Defence is full of denials and does not demonstrate any triable issue. Regarding the failure to file a Defence within 14 days upon service the respondent’s draft defence is silent and in the written submissions, he shifts the blame to his advocatesb.Whether this summary judgment can be set aside and the Respondent to be granted leave to file his Defence out of time?Reading through the Respondent’s draft Defence statement and his written submissions gives an impression that the respondent has no convincing reasons to support the repayment of the loan as stated in draft Defence under part of the paragraph 4 as:“The respondent sates that he has been servicing the loan facility until 2020 when he requested the claimant to avail a statement of account since the internet charges were exorbitant.”

11. A cursory look at the member loan account presented by the claimant shows that since 2018 there has been only three (3) credit entries in the loan account which is posted as “interest paid “ in 2019 one (1) posted to loan as nothing more.

12. In our minds, we are alive to the fact that money loaned to the respondent belong to members of the Sacco and to allow a member to get away with a loan will make the Sacco and its members suffer more than the suffering of a single member.To this end, the Tribunal shall not allow one member to pull down others.

13. Turning to the Respondent’s statement regarding the mistake of his advocate as his Defence on the delay to file his substantive Defence the Tribunal is guided by the decision of the court in the case of Sameer Africa Limited versus Aggarwal and Sons Limited 2013 where the court considered circumstances similar to this of the instant Respondent.The court stated thus:“Although I have every sympathy with the defendant which has been caught out by no mistake of its own of its advocate in not filing its statement of Defence in time, and donor consider that this simply is this in in the triable issues worthy of the name……. I refuse to exercise my discretion to set aside to default judgment entered herein on 18/4/2013. I dismiss the defendants notice of motion with costs to the plaintiff.”

14. When we mirror the contents of the Respondent’s Draft Supporting Affidavit dated 19/1/2024 and written submissions dated 10/5/2024 the thing that stands out is the Respondent’s blame against his advocate which is mimicked as a Defence and with nothing to show that the Respondent took some step.

15. In the case of Ruga Distributors Limited Versus Nairobi bottlers Limited 2011, the court stated that:“it is not enough for a party to blame their advocates but to show the tangible steps taken by him in following up his matter.”Upshot of this is that the Tribunal would be wasting its time by reopening a case whose outcome is almost certain to wit a Defence that is a shame.

16. Flowing from the above, we find that Respondent’s Notice of Motion Application dated 19/1/2024 calling for the setting aside of the summary judgment does not have feet to stand on because the Draft Defence and all his bundle of documents does not show any triable issues. We therefore refuse to tamper with summary judgment.

17. In conclusion, it is our finding that the Respondent’s Notice of Motion Application dated 19/1/2024 is found to be without merit and dismissed with costs.

Default judgment entered on 20. 12. 2023 is upheld. It is so ordered. File closed.

RULING SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 29TH DAY OF AUGUST, 2024. Hon. B. Kimemia Chairperson Signed 29. 8.2024Hon. J. Mwatsama Deputy Chairperson Signed 29. 8.2024Hon. Beatrice Sawe Member Signed 29. 8.2024Hon. Fridah Lotuiya Member Signed 29. 8.2024Hon. Philip Gichuki Member Signed 29. 8.2024Hon. Michael Chesikaw Member Signed 29. 8.2024Hon. Paul Aol Member Signed 29. 8.2024Tribunal Clerk JonahMiss Njeru holding brief for Ms. Gichuhi advocate for Claimant/Respondent.S.N.Thuku advocate for Respondent- No appearance.Balozi Housing Cooperative Society Limited- No appearanceHon. J. Mwatsama Deputy Chairperson Signed 29. 8.2024