PCEA Ruiru Sacco Limited v Karanja [2024] KECPT 1384 (KLR)

PCEA Ruiru Sacco Limited v Karanja (Tribunal Case 91/E183 of 2022) [2024] KECPT 1384 (KLR) (29 August 2024) (Ruling)

Neutral citation: [2024] KECPT 1384 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case 91/E183 of 2022

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

August 29, 2024

Between

PCEA Ruiru Sacco Limited

Claimant

and

Samson Gugi Karanja

Respondent

Ruling

1. This ruling dispenses with the notice of Motion Application is dated 28th November 2023 and supported by an affidavit sworn by the Respondent/Applicant, Samson Ngugi KaranjA, and brought under Section 1A & 3A of the Civil Procedure Act, Order 22 Rule 22 of the Civil Procedure Rules, Order 51 Rule 1 and all other enabling provisions. The Application seeks the following orders:a.That this application be certified urgent.b.That leave be granted to the firm of M/s Gikenye Mugo & Rienye to come on record for the Respondent.c.That pending interparties hearing and subsequent determination of this application the Honourable Tribunal be pleased to issue an order staying the proclamation, seizure of proclaimed items, sale of the proclaimed items by auction or otherwise by the Claimant/Respondent and/or their agents or servants.d.That pending the interparties hearing and determination of this application, this Honourable Tribunal be pleased to order stay of execution of the decree dated 28th August, 2022. e.That this Honourable Tribunal be pleased to prohibit the Respondent from unilaterally increasing the monthly instalments as per the consent order upwards from Kshs. 15,000 to Kshs. 50,000/=.f.That this Honourable Tribunal be pleased to order the unconditional setting aside or lifting of the warrants of attachment and sale issued on 19th September, 2023 and proclamation or any form of advertisement or sale of the Applicant’s proclaimed properties.g.The costs of this application be in the cause.

2. The Application is premised on the grounds on its face which are inter alia that: on the 4th of June 2022 the Claimant and the Respondent entered into a consent on how the money owing to the Claimant would be paid by the Respondent. The Applicant contends that the Consent was adopted as a judgment of the court and the file closed. The Applicant now claims that the Claimant has now varied the order, extracted a decree and n order, applied for warrants of attachments, and engaged Expeditious Auctioneers to attach his property.

3. The brief background of this matter is that the claimant filed a Statement of Claim dated 1st March 2022, in which the Claimant claimed an amount of Ksh. 1,438,832 from the Respondent being an amount that was defaulted from the loan that had been advanced to the Respondent. On 14th June 2022, the parties entered into a consent that was later adopted as a judgment of the court.

4. The Claimant filed a Replying Affidavit dated 29th June 2024 in which they aver that the Respondent defaulted on the provisions of the consent and there is an express clause in the consent that on default in any one installment in the consent, execution would issue. It is also the Claimant's response that the Ksh. 450,000/= installment was not predicated on payment of any money by the county government of Kiambu.

5. Both parties filed their submissions.

6. In their submissions, the Applicants submitted that this court should bar the Claimants from increasing the installments to Kshs. 50,000/= since it is beyond what he can raise. The Applicant appeals to the discretion of this court to allow him to pay the loans in installments.

7. In their submissions, the Respondents submitted that the consent entered into by the parties was tantamount to a contract between the parties and had the same binding force as a contract. He relied on various cases which ought to show that consent is binding unless the same is varied, rescinded, or set aside.

Analysis 8. This Tribunal has noted the application, the response, and the submissions with regard to this application. It is not in dispute that the Applicant is indebted to the Respondent. It is also not in dispute that a consent was entered into between the Applicant and the Respondent, and that the same was adopted as a judgment of this court. Further, it is not in dispute that the Claimant/Applicant defaulted on the terms of the consent.

9. What this court asks itself is whether the Applicant is entitled to the orders sought. The consent was entered upon by both parties, and we ask ourselves if the applicant gets his orders, what becomes of the consent that has not been varied or set aside?

10. In Brooke Bond Liebig vs Mallya (1975) EA 266 Mustafa stated thus;“The compromise agreement was made an order of the court and was thus a consent judgment. It is well settled that a consent judgment can be set aside only in certain circumstances, e.g on grounds of fraud or collusion, that there was no consensus between the parties, public policy or for such reasons as would enable a court to set aside or rescind a contract.”

11. And in the case of Flora N. Wasike vs Destimo Wamboko [1988] eKLR Hancox JA stated that;…………."It is now settled law that a consent judgment or order has contractual effect and can only be set aside on grounds which would justify setting a contract aside, or if certain conditions remain to be fulfilled, which are not carried out."

12. Essentially, the above-cited authorities are clear that a consent order will only be set aside if it can be demonstrated that it was procured through fraud, non-disclosure of material facts or mistake, or for a reason that would enable a court to set it aside. The consent judgment has the effect same as that of a contract. The Consent judgment was very clear on the terms and the repayment schedule. The Applicant breached a term of the contract by failing to adhere to the schedule that they had agreed upon with the Respondent. There is no evidence of any fraud or misrepresentation that led to the consent. This makes us conclude that the consent was entered into through free will by both parties. This court cannot rewrite or vary the terms of a contract to suit the circumstances of one party. As the Respondent aptly submitted, there was no condition attached to the settlement of any of the installments. The Kshs. 450,000/= was to be paid on or before 30th December 2022, but the Applicant settled the same on 5th October 2023, several months later. The default triggered clause 3 of the consent, and the respondent was in order to execute.

13. In the upshot of the foregoing, we make the following orders;a.Notice of Motion Application dated 28th November 2023 lacks merit is hereby dismissed with costs.b.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 JONAHMs. Maina advocate holding brief for Mr. Njuru advocate for the Claimant.Samson Ngugi Karanja- No appearance.HON. J. MWATSAMA DEPUTY CHAIRPERSON SIGNED 29. 8.2024