Sarah Busolo v Butali Savings and Credit Co-operative Society Limited [2020] KECPT 93 (KLR)

REPUBLIC OF KENYA

IN THE CO-OPERATIVE TRIBUNAL

AT KAKAMEGA

TRIBUNAL CASE NO. 674 OF 2017

SARAH  BUSOLO.....................................CLAIMANT

VERSUS

BUTALI SAVINGS AND CREDIT  CO-OPERATIVE

SOCIETY LIMITED ............................RESPONDENT

JUDGMENT

The matter  for determination  is the Claim  dated  7. 12. 2017 filed  on the same  date seeking  for a  refund  of deposits  amounting  Kshs.152,000/=. The  Respondent filed a defence  and  Counterclaim  dated  20. 1.2018 and filed  on  24. 1.2018. The  Respondent  claimed  Kshs.251,633/= being  Claimant’s  liabilities  and   the  debts  owed  to it. The Claimant filed her Reply to defence and Defence to Counterclaim dated  28. 2.2018 and filed  on  1. 3.2018.  The matter  came up  for hearing. The  Claimant  Jackline  Sarah  Busolo (CW-1) testified. She stated  that she was  a member  of  the Respondent  since  2012. That  she was  the treasurer  and was removed  in 2015 when  she handed over  to Paul  Wawire.That  her suspension  letter  was issued  on  10. 5.2017 and thereafter  she voluntarily  decided to terminate her membership vide  a letter written  through  her advocate  dated 29. 6.2017. That her deposits then amounted to Kshs.152,000/- and the  payslips  showed  deductions of Kshs.2000/=per month. She  stated  that  she was accused of  misappropriating  funds as per  the minutes  of the General  Meeting  and denied  liability  to repay  the money.

In cross examination, she confirmed that all officials had the duty to account.  That at the hand over, the  committee asked her to explain  the allegations of the  Annual General  Meeting and  thereafter, she  was removed  on the  allegation  of  unverified cash. She confirmed that she did not go to show cause on the suspension.

RW-1, Hesbond  Nyikali Malusa- Chairman  - Butali  Sacco  adopted  his  witness statement  and stated  that he was working  with the Claimant  who was  the treasurer. That the claimant  had unverified cash  which  she could  not explain  and with  two (2)  others, were  removed  from  office  by the  General  Membership Meeting  of  28. 6.2016. That  she was  among  the officials  liable  to  pay for  certain  funds of  which  he paid. That the  treasurer  being  the chief accounting  officer  of  the Sacco, vide  the letter dated  10. 5.2017,  was to either  explain  or be  suspended  from  the committee  and that is when she sent her  intention  to withdraw  from  the Sacco. That  each  official  was  to pay  a  certain  amount  to the Sacco and they paid  with the exception  of the claimant. On her part,  the  claimant  was  required  to pay Kshs.258,615/=.

Parties filed their written submissions.  The claimant filed hers on 4. 12. 2019 while  the respondent  did so  on  29. 11. 2019.

The Claimant submitted that she was entitled to her deposits of  Kshs.152,000/=. She  denied her  liability  as contained  in  the counterclaim  and  alleged  the same  was unverified  cash which  did not  mean  lost cash. That  the counterclaim  is not  based  on  any audit  report  and that  the  dispute  fall  under section  73  of  the Co-operative  Societies Act (Cap  490) Laws of Kenya.

The Respondent’s  submissions  is that the claimants  was duly  informed  that she  could not  be refunded  her shares  until  and  unless  she ceases  to be a  member  of the society. That  it was  on  this  basis that she  filed  this claim  and the Respondent  filed  a  counterclaim  for  Kshs.258,615/=

That  there  was an  inspection  report  by the  District Co-operative  Officer which  apportioned  liability  to the officials  including  the Claimant and the said  members  were  accordingly surcharged. That the claimant was served with a show cause letter. That  she did  not show  cause  but instead  claimed  immediate  payment  of her  shares.

That she is therefore  liable  to pay  the Respondent  the amounts as  claimed  to the counterclaim.

We have carefully considered the evidence on record and the exhibits produced  together with the written  submissions of the parties. It is apparent that the Claimant vide her letter dated 29. 6.2017 clearly communicated her desire to withdraw from the Sacco. Our appreciation of the wording of the letter is that the same was a notice of withdrawal  from the  Sacco. She  therefore ceased  being  a  member  of the  Sacco after  the expiry of  sixty  days  from  the date  of  the said letter.

In the absence  of  any objection  to her claim of refund of Kshs.152,000/= by  the Respondent, we  find  that she  is  entitled  to refund  of  the said  amount.

As regards the Counterclaim, we have looked at the documents presented by the Respondent specifically Defence Exhibit. No. 2 being  the  handing over  minutes  for the meeting  held  on  28. 6.2016 together with  the summary  thereof  Defence Exhibit-3.  We have also looked at the petty cash expenses Defence Exhibit. 16,  the  inspection  report  Defence Exhibit  1,   the audit  report  Defence Exhibit. 10 and  the receipts  thereof, we are  satisfied  that  the process  which led  to the officials of the Respondent being surcharged  was fair  and that all  the other  official  paid  up their  surcharged  amounts  to the  exception of the  Claimant.  The Claimant was required to show cause but she never appeared. We therefore  find her  liable  to the  amounts  counterclaim  that is,  Kshs.258,615/=.

We  order  for  this amount  to be  recovered  from  her deposits  and that  any other  outstanding  amount  to be  recovered  from her personally.

We therefore  enter judgment  in favour  of the claimant  for Kshs.152,000/= and the Respondent  for Kshs.258,615/=.

The Claimant  will therefore  pay  the Respondent  the sum  of Kshs.106,615/= plus  interests and costs.

Read and delivered in an open court this 26th day of February 2020

In the presence of ;-

Claimant            :         Sandra  holding brief  for Kiveu

Respondent                 :     Kirunja  holding brief for  Akwala  for Respondent

Court Assistant            :    Leweri Raphael

Hon. B. Kimemia

Chairman             Signed

Hon. Terer

Deputy Chairman       Signed

P. Swanya

Member                 Signed

Hon. B. Kimemia

Chairman          Signed          26. 2.2020