Muki Sacco Society Limited v David Kimutai Ngetich; Ojiambo & Company Advocates (Garnishee) [2021] KECPT 525 (KLR)

REPUBLIC OF KENYA

IN THE CO-OPERATIVE TRIBUNAL AT NAIROBI

TRIBUNAL CASE NO.387 OF 2020

MUKI SACCO SOCIETY LIMITED.............................................CLAIMANT

VERSUS

DAVID  KIMUTAI  NGETICH..................................................RESPONDENT

AND

OJIAMBO & COMPANY  ADVOCATES...................................GARNISHEE

RULING

Vide the Application  dated 20. 5.2020,  the Respondent has moved  this Tribunal  seeking  for the following Orders:

1.  That there  be stay  of execution  pending  the hearing  and determination  of this Application;

2.  That  this Honourable  Tribunal  be pleased to set aside  the ex-parte  proceedings  herein,  the judgment  entered on 25. 9.2018 and the decree herein dated 4. 11. 2019;

3.  That the  Respondent/Applicant  be granted  leave  to file  defence  to the  statement of  claim  and defend  this suit;

4.  That  Defence  filed herein  be deemed  proper  and duly  filed; and

5.   That the costs of this Application  be  provided for.

The Application is supported by the grounds on its face the Supporting  Affidavit  sworn on even date and  the Further  Affidavit  sworn  on  13. 10. 2020.

The Claimant has  opposed  the Application vide the Replying  Affidavit  sworn by Violet  Wanjiru  Ndung’u  on 8. 9.2020.

Vide  the  directions  given  on  6. 8.2020,  the Application  was canvassed  by way of  written submissions.  The Respondent  filed  his written submissions  on  16. 10. 2020 while  the Claimant  did so on 17. 12. 2020.

Respondent’s  Contention

Vide the instant  Application, the Respondent  contend  that whilst  he received  pleadings  in the matter in November,  2018,  he did not  enter Appearance  or file a Defence  as the court file  was not  readily  available  at the registry whenever he attempted  to do so.  That the issues  raised  in the instant  Application  have  been the subject   of Nakuru ELRC NO. 48 OF  2017 and  that the court  in that case   has made  a final determination.

Vide  his  supporting  Affidavit sworn  on even date(20. 5.2020) the  Respondent  avers that  he received summons to enter Appearance  to the exclusion  of pleadings  around  November 2018.  That he later shared a copy  of the  summons with  his lawyer in June,  2019. That upon receipt  of the summons,  the lawyer  tried tracing  the court file  to  no avail.

Claimant’s  Contention

Vide the  Replying  Affidavit  sworn  by Violet  Wanjiru  Ndungu on 8. 9.2020,  the Claimant  has opposed the  Application  on grounds  that the Respondent  was duly  served with  summons to enter  Appearance on  3. 12. 2018. That  after  7 months that is,  on  17. 6.2019,  he  entered  appearance  and again  failed to  file a Defence  until  25. 9.2019 when  summary judgment  was entered. That  again, it has taken him  over  one (1) year to  file  the instant  Application.

That  as regards the assertion  that  the court  file was missing, the Respondent  has not led  evidence  to confirm  this fact.

That  proceedings  in  ELRC NO.49/19 related  to  unemployment  dispute  between  the Claimant  and the Respondent. That  the Respondent  has  not  demonstrated  that  he has  a good  Defence for the following reasons:

a. That the Respondent for applied  and obtained  various  loans from  the Claimant;

b. That  he has not stated whether  or not he repaid  the said loans;

c. That  he has not given any proposal on repayment of the said  loans.

Issues  for determination

The instant Application  has presented  the following  issues for  determination.

a. Whether the Respondent  has laid  a proper  basis to warrant  the setting aside  of the default  judgment  entered  in 25. 9.2019;

b. Who should  meet  the costs  of  the Application?

Setting aside of default  Judgment

We have  jurisdiction  to set aside a  default  judgment  by dint  of Order  10 Rule  11 of the Civil  Procedure  Rules. The Rule  provides  thus:

“ 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.”

In the case of  Patel – vs-  East  Africa Cargo  Service  Limited (1974)EA 75, the Court underscored this provision  in the following terms:

“ The main concern of the court is to do justice to the parties  and the  court will  not impose  conditions  on itself to fetter  the wide  discretion  given  to it  by the Rules.”

Before  we can exercise  our jurisdiction  under Order  10 Rule 11  above,  we firstly  have to ascertain  whether  the  default  judgment  is a regular  or irregular  one.  If the  Judgment  is an irregular  one,  then we will  set  it  aside  ex debito  justiciae.

This  was the holding  in the case of  K- Rep  Bank  Limited  -vs-  Segment  Distributors  Limited [2017] eKLR.

The court  in the  case of  Fidelity  Commercial Bank  Limited – vs-  Owen Amos  Ndungu  & Another, HCC.NO. 241/1998  gave  a distinction  between  a regular  and irregular judgment  as follows:

“ A distinction  is drawn  between  regular  and irregular  judgments.  Where summons  to  enter  Appearance  has  been served  and  there is  default  in entry  of Appearance  the ex parte  judgment  entered  in default is regular.  But where  the exparte judgment  sought  to be set  aside  is obtained  either because  there  was no proper  service  or any service  at all, of  the summons  to enter  Appearance, such  judgment  is  irregular  and  the affected Defendant  is entitled  to have  it set aside as of right”

Where  the  default  judgment  is  regular,  then  the Tribunal  has to  consider   if the draft  Defence filed with the Application raises triable issues. This was the holding in the case of James Kanyiita Nderitu & Another  - vs-  Marios  Philotas  Ghikes  & Another [2016]eKLR.  In  the pertinent  part,  the court  held thus:

“ In a regular  default  judgment,  the  Defendant  will have  been duly  served  with  summons  to enter  appearance,  but for one  reason  or another,  he failed  to enter appearance or to file  a Defence,  resulting  in default  judgment.  Such  a Defendant  is entitled  under Order  10 Rule  11  of the Civil  Procedure  Rules  to move to  court to  set aside  the default  judgment  and to  grant  him leave  to  defend  the suit.  In such a scenario,  the court has unfettered  discretion  in determining  whether  or not to  set aside  the default judgment  and will  take into  account such  factors  as to the  reason  as for  the failure  of the Defendant  to file his  memorandum  of Appearance,  or  defence,  as the case may be, the length  of  time that has  elapsed  since the default  judgment  was entered; whether  the intended  Defence  raises  triable  issues,  the  respective  prejudice each party  is likely  to suffer whether  on the whole,  it is  in the  interests of  justice  to set  aside   the default judgment.”

Reasons  for failure  to file  a  Defence

The main  reason  why  the Respondent  did not file a  Defence  is that he was  only served with summons  to  enter Appearance  to the  exclusion  of other pleadings. That  when he wanted to obtain  copies  of the said documents  from  the court file,  the same was missing.

We have perused the record  and note that  there is nothing  to show that the Respondent  brought  to the attention  of the Tribunal  the fact  that the  Tribunal file  was missing.

Further,  it is instructive to  note that  the  Claimant  has a lawyer  on record  with a  known address.  The Respondent has not stated whether  he tried  to  obtain  copies  of the said  pleadings  from  cases on record  for the Claimant.

In totality  of the foregoing is that  the Respondent  has not  given a plausible reason  as to justify  failure  to file  a Defence within  the time  limited  by the Rules.

Draft Defence

The claim  herein  is for recovery  of loan  arrears. We  have perused  the Respondent’s  draft  statement of  Response. He confirms  having taken the loan  from the Claimant on diverse  dates. He avers  that his  contract  with the Claimant  was terminated  in the year  2016 and that the subject  of the pending  loans was subject  to proceedings  in ELRC NO. 49/2017. That  he  repaid  the loan within the contractual  period  and that the said  period  has not expired.

What  we gather  from the said  draft  Response  is that the Respondent  does  not deny  taking the loan. He does  not also  deny the fact  that  he is in  arrears. We thus  do not find  any issue  worth  trying  if  we were  to  admit  the claim  for hearing.  In simple  terms,  we are saying  that the draft  statement  of Response  does not  raise  any triable  issue.

Conclusion

The upshot  of the foregoing  is that  we do not  find merit  in the Respondent’s  Application dated 20. 5.2020 and hereby  dismiss  it with costs to the Claimant.

Ruling signed, dated and delivered virtually this 7th day of  January,  2021.

Hon. F. Terer                          Deputy Chairman      Signed      7. 1.2021

Mr. P. Gichuki                       Member                       Signed      7. 1.2021

Mr. B. Akusala                     Member                       Signed      7. 1.2021