Republic v Prime Bank & another [2022] KEHC 13796 (KLR)

Republic v Prime Bank & another (Anti-corruption and Economic Crimes Miscellaneous 47 of 2018) [2022] KEHC 13796 (KLR) (Anti-Corruption and Economic Crimes) (6 October 2022) (Ruling)

Neutral citation: [2022] KEHC 13796 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Law Courts)

Anti-Corruption and Economic Crimes

Anti-corruption and Economic Crimes Miscellaneous 47 of 2018

EN Maina, J

October 6, 2022

Between

Republic

Applicant

and

Prime Bank

1st Respondent

Esther Gathoni Mwangi

2nd Respondent

Ruling

1. By the notice of motion dated October 12, 2018 the director of public prosecutions/applicant sought to set aside orders issued in Chief Magistrates Misc Cr Cause No 2500 of 2018 Banking Fraud Investigations v Prime Bank & Esther Gathoni, the respondent in this case. The effect of the impugned order was to set aside freezing preservatory and conservatory orders issued in regard to bank accounts No 3000xxxx, 4000xxxxx, 400xxxx, 4000xxxxx and 4000xxxxx all in the names of the respondent herein. Those orders were issued by Hon E Riany on September 12, 2018.

2. The gist of the application as can be discerned from the grounds on its face, the supporting affidavits one sworn by Sgt Peter Ouma on October 12, 2018 and the other sworn by Cpl Samuel Epara on even date and the submissions of learned counsel for the applicant, is that the monies in the accounts are exhibits in three criminal cases namely:-a.Cr 883 of 2018, Republic v William Charles Fryda.b.Cr 1241 of 2018, Republic v Seth Manera.c.Cr 1028 of 2018, Republic v Esther Gathoni.That therefore the order issued by Hon E Rainy on September 12, 2018 unfreezing the accounts is illegal, incorrect and improper and this court should set it aside and issue an order preserving the funds in those accounts pending hearing and determination of the aforestated criminal cases.

3. The application was vehemently opposed by the 2nd respondent. learned counsel for the 1st respondent did not however take part in the proceedings preferring instead to abide by whatever decision is made by this court.

4. For the 2nd respondent it was argued that the application is an abuse of the court process. learned Senior Counsel Ahmednassir, who appeared together with Mr Cohen, submitted that the application brings to the fore the constant conflict between the office of the Director of Public Prosecutions and the Directorate of Criminal Investigations; that it is now settled that when it comes to filing cases the proper office is that of the Director of Public Prosecutions’; that the deponents of the affidavits who have no training in law have usurped the office of the Director of Public Prosecutions and filed one case after the other, in total ten miscellaneous applications, which all end up being discharged by the magistrates on the ground that the applicant is using the criminal process to settle a civil matter. Learned senior counsel pointed out that none of those rulings have been appealed and accused the applicant of exhibiting a 'don’t-care' attitude to the plight of the 2nd respondent. senior counsel contended that it was unprofessional for the applicant to continue with this application while aware of a judgment rendered by Mrima J in HC Constitution Petition No 215 of 2018 Esther Gathoni Mwangi v Director of Public Prosecutions & Others; William Charles Fryda & 3 others (interested parties) [2022] eKLR. Senior counsel stated that Mrima J’s holding was that the impugned funds were in respect of legal fees and costs; that the applicant knows that all the applications before the magistrates were designed to put pressure on Dr Fryda and that the Director of Public Prosecutions should cease from charging, arresting, prosecuting and harassing the 2nd respondent herein in her capacity as the advocate for Dr Fryda. Senior counsel cautioned this court on leaning too much on the prosecution’s side. He also contended that the application is incomplete as it seeks to review the orders made in applications which are incompetent by virtue of being filed by police officers. Senior counsel urged this court to express displeasure on the actions of Ouma and Epara who made those applications.

5. Mr Cohen learned counsel who appears for the 2nd respondent together with senior counsel Ahmednassir submitted that this is not a case of money laundering as the source of the money is known. Counsel pointed out that the judgment of Mrima J was not appealed and urged this court to let the 2nd respondent enjoy her legal fees.

6. In her reply Ms Ng’ethe, learned counsel for the applicant submitted that the applicant had regularized the status of the application by the Director of Public Prosecutions filing it and hence the application is now properly before this court. She urged this court to grant the application so that the matter of disposition of the monies is left to the court trying the criminal cases.

7. I have considered the application, the grounds thereof, the affidavits both in support and against, the rival submissions of learned counsel for the parties both written and oral and the cases cited thereat.

8. Initially the applicant approached this court vide an application dated September 14, 2018 which was struck out by the court (Ong’undi J) for having been filed by Cpl Epara who was not competent to do so. In the ruling dated October 5, 2018 Ong’undi J gave liberty to the Director of Public Prosecutions to lodge a fresh application within 7 days. She also issued orders that pending the application the funds in the accounts in issue were not to be interfered with by either of the parties. It was following that order of Ong’undi J that the present application was filed. The application is therefore properly before this court and it is the learned counsel for the 2nd respondent have submitted that the orders are no longer capable of being sustained in view of Mrima J’s judgment in High Court Constitution Petition No 215 of 2018 (supra). Mrima J’s orders in that petition are as follows:-'a. A declaration be and hereby issues that all the acts and or threatened acts by the respondents and/or their agents, privies and any other person acting on their instructions of harassment, intimidation, questioning, investigating, charging, prosecuting against the petitioner by the respondents amounts to infringement of the petitioner's rights and fundamental freedoms as enshrined in articles 27(1), 28, 31, 40, 47(1) and 50(1) as well as contravention of article 157(11) of theConstitution and are, therefore, unconstitutional.b. An order of certiorari be and hereby issues to bring the decision by the respondents to charge and prosecute the petitioner on the charges preferred against her vide the charge sheet dated June 6, 2018 in Milimani Chief Magistrates Court Criminal Case No 1028 of 2018: Republic v Esther Gathoni Mwangi before this court and to quash and set aside the said decision. The said decision be and is hereby quashed and/or set-aside forthwith.c. An order of prohibition be and is hereby issued restraining the respondents whether by themselves and/or their agents, privies and any other person acting on their instructions from charging, prosecuting, arresting, continued harassment, questioning and intimidation on any matter concerning the petitioner's alleged involvement in the affairs of St Mary’s Mission Hospital, the Assumption Sisters of Nairobi and Dr William Charles Fryda in her capacity as an Advocate of Dr William Charles Fryda.'

9. The above orders are self-explanatory and they relate to the Director of Public Prosecution’s decision to prosecute the 2nd respondent in the charges preferred against her in the charge sheet dated June 6, 2018 in Milimani CMCRC No 1028 of 2018. I have had sight of the offences and the same state: -'Count IStealing contrary to section 268(1) as read with section 275 of the Penal Code.Particulars of offenceEsther Gathoni MwangiOn the November 24, 2017 at Prime Bank Riverside Drive branch within Nairobi County, jointly with others not before court, stole Kshs 2,850,000/- the property of St Mary’s Mission Hospital. (alternative count see attached sheet)Alternative countHandling stolen goods contrary to section 322(1)(2) of the Penal CodeParticulars of offence: Esther Gathoni MwangiOn the November 24, 2013 at Prime Bank Riverside Drive Branch within Nairobi County, otherwise than in the course of stealing, dishonestly received Kshs 2850,000/- (two million eight hundred and fifty shillings) knowing or having reason to believe them to be stolen property.Count II: Conspiracy to commit a felony contrary to section 393 of the Penal Code.Particulars: Esther Gathoni MwangiOn diverse dates between December 29, 2017 and January 29, 2018 at Prime Bank Riverside Branch within Nairobi County, jointly with others not before court conspired to commit a felony namely stealing Ksh 153, 468, 000/= (one hundred and fifty three million, four hundred sixty eight thousand shillings) from St Mary’s Mission Hospital.Count IIIMoney laundering contrary to section 3(b) (iii) as read with section 16(i)(a) of Proceeds of Crime and Anti-Money Laundering Act of 2009. ParticularsEsther Gathoni Mwangi on diverse dates between December 29, 2017 and January 29, 2018 at Prime Bank Riverside Branch within Nairobi County, received KShs 153,468,000/= which you reasonably ought to have known formed part of proceeds of stealing.'

10. In so far as this court is concerned the prosecution of the 2nd respondent for the above offences can no longer stand the decision to charge the 2nd respondent herein having been impeached by the judgment of Mrima J. At first glance it would appear therefore that the order to freeze the accounts would serve no useful purpose. This is until one scrutinizes the record and finds that the subject files also concern the prosecution of two other persons namely William Charles Fryda and Seth Manera in Cr Case 883 of 2018 and Cr 1028 of 2018 respectively.

11. In the instant application this court is urged to examine the decision of Hon E Riany dated September 12, 2018 which unfroze the accounts holding the funds. It is urged that the funds are exhibits in the criminal cases still pending in the trial courts and that therefore Hon E Riany’s order was illegal or incorrect. Counsel for the 2nd respondent have argued that the funds deposited in the accounts are legally in those accounts and since the constitutional court has pronounced itself and the orders of that court have not been appealed the prayers in this application ought to be allowed.

12. Having considered the record carefully my finding is that the application to continue preserving the funds has merit. This is given that the same ae exhibits in two criminal trials pending against persons other than the 2nd respondent. Hon E Riany clearly erred in setting aside orders preserving funds in matters which were pending before other courts. In my view only the courts hearing the cases can determine whether or not having the orders in place would serve the interest of the administration of justice. In the premises the notice of motion dated October 12, 2018 is allowed and the order of Hon E Riany is set aside. For the avoidance of doubt given the passage of time should the criminal cases against William Charles Fryda being Cr C883 of 2018 and Seth Manera being Cr 1241 of 2018 have been concluded and contrary orders made therein, the orders of this court shall be of no effect. It is so ordered.

DATED, SIGNED AND DELIVERED VIRTUALLY THIS 6TH DAY OF OCTOBER, 2022. E N MAINAJUDGE