Shopper Sacco Limited v Mwatha [2025] KECPT 130 (KLR)

Shopper Sacco Limited v Mwatha (Tribunal Case 375/E114 of 2021) [2025] KECPT 130 (KLR) (30 January 2025) (Judgment)

Neutral citation: [2025] KECPT 130 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case 375/E114 of 2021

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

January 30, 2025

Between

Shopper Sacco Limited

Claimant

and

Ibrahim Karanja Mwatha

Respondent

Judgment

CLAIMANTS CASE 1. The Claimants case is based on the following:-a.Statement of claim dated 5/7/2021. b.Claimant witness statement dated 5/7/2021. c.Documents dated 5/7/2021. d.Hearing the case on 16/5/2024. e.Submission dated 15/7/2024.

2. In the statement of claim the Claimant states that they granted the Respondent Kshs.5,000,000/= around March 2015.

3. They state that the Claimant was granted a further Kshs.5,000,000/= around September 2015 bringing the total loan to the Respondent to Kshs.10,000,000/=. The Claimant avers that the loans were to be repaid in 48 months at 12% per annum on reducing balance.

4. The Claimant states that the loan was defaulted from May 2021 as the current defaulted amount is Kshs.2,380,971. 10/= as at July, 2021. The Claimant state that the loan balance including interest is Kshs.3,699,187. 46/=.

5. In his witness statement, Mr. David Odhiambo for the Claimant stated that the two loans granted to the Clamant was guaranteed by guarantors and that in the event of default all the costs associated with recovery were to be borne by the Respondent. The Claimant witness admits that the Claimant SACCO recovered the defaulted amount of Kshs.603,396,43/= from the guarantors to offset part of the defaulted loan.

6. The Claimant has filed relevant documents in support of this case which include among others the following: -a.Loan agreement form.b.Various pay slips.c.Member statement.d.Demand letter.

7. The Claimant’s case came up for leaving on 16/5/2023 where Ms. Anastacia Njeri adopted her statement as her evidence in chief she confirmed that the Claimant was granted loans totaling Kshs.10,000,000/= which he defaulted occasioning the Claimant to go for guarantors’ savings amount to Kshs.603,000. /=She stated that the Claimant was an employee of Nakumatt Supermarket.

8. She stated that the Respondent was issued with his account statement that he left employment in 2018, stopping repayments of the loan in 2020.

9. The Claimant filed their submissions highlighting the issues for determination which include:-a.Whether the respondent breeched the terms of the loan agreement.b.The Claimant submitted that both they had a contractual relationship with the Respondent and that the Respondent acknowledges owing the Claimant but disputed the amount.

10. He submitted that there was a breach of the terms of the loan agreement by the Respondent by failing to repay the loan.

11. He further submitted that the terms of the loan facility were between the Claimant and the Respondent and that the employer, Nakumatt was not part of the contract.

RESPONDENT’S CASE 12. The Respondent’s case is based on the Statement of Defence and Counter Claim dated 28/10/2021 and supported by the following:a.Respondent witness statement of 25/5/2023. b.Documents dated 25/5/2023. c.Hearing of the case on 16/5/2024. d.Submissions dated 12/10/2024.

13. In their Defence, the Respondent admits being granted a loan of Kshs.5,000,000/= on 11/3/2015 but denies an addition loan of Kshs.5,000,000/= as alleged by the Claimant in paragraph 7 of the statement of claim.The cumulative loan of Kshs.10,000,000/= is denied by the Respondent.

14. The Respondent denies receiving demand notice or intention to sue as alleged by the Claimant in paragraph 18 of the statement of claim.

15. As regards the counter-claim the Respondent avers that Kshs.1,171,354/= was credited in the Respondent loan account raising the loan balance from Kshs.966,769/= to Kshs.2,138,123. 77/= in June, 2020.

16. The Respondent avers that this credit into his account was suspicious and therefore raised the issue with the Claimant.

17. The Respondent states that the explanation given was that the Kshs.1. 171,354/= was related to deductions that were supposed to have been by the employer that had not been remitted by the employer, Nakumatt Holdings Ltd.

18. The Respondent avers that the suspicious credit was a double charge which is a fraud.

19. The Respondent therefore prays for an order for repudiation of the contracts and General Manager, among others.

20. In his witness statement the Respondent Mr. Ibrahim Karanja on oath admits a loan of Kshs.5,000,000/= on 10/3/2015 and a further Kshs.5,000,000/= on 29/9/2015 which he states that he repaid though the payroll even after leaving the employment of Nakumatt Holdings Ltd.

21. He states that his account was credited with a suspicious amount of Kshs.1,171,354/=.

22. He avers that the claim of Kshs.4,049,409. 39/= by the Claimant is perplenting obnoxious.

23. The Respondent has filed documents in support of his case which include a copy of the loan agreement dated 10/3/2015 and the one dated 29/8/2015. He has also attached payslips for the year 2017, among others.

24. The Respondent case came for hearing on 16/5/2024 wherein the Respondent adopted his statement and documents as his evidence in chief.

25. The Respondent admitted he had other loans prior to the Kshs.5,000,000/= loan.

26. He stated that his issue is the Kshs.1,171,354/= suspicious credit to his account and his savings with the SACCO.

27. He admitted that his complaint letter to the SACCO was not acknowledged.

28. He avers that he was contributing Kshs.30,000/= per month to the SACCO.

29. In the Respondent written submission dated 12/10/2024 the Respondent raised the issue of the suspicious credit into his account which he avers is a double charge.

30. The Respondents states that he owes the Claimant Kshs.966,769/= and prays that this amount should be recovered from his dividends.

Counter claim 31. The Respondent filed a Counter-Claim on 28/10/2021 praying for the following: -a.An order for reputation of the contracts.b.General damages for the breach of contracts.c.Court of the suit.d.Any other relief.

32. The Respondent sites the following as the key area of the breach of contract.a.Double charging by the Claimant.b.Failure of Claimant to account for the payments made by the Respondent.

33. He avers that the refusal by the Claimant to supply him with financial statement, status of his shares and the illegal credit to his account by the Claimant have greatly prejudiced him.

ANALYSIS 34. This Tribunal notes that the Respondent was granted two loans amounting to Kshs.10,000,000/= which he defaulted. We also note that the Respondent does not deny the two loans but challenges the loan balance.

35. The Kshs.1,171,354/= allegedly deducted by the employer but not remitted to the SACCO in the contentious issue.

36. It is not the role of the Respondent to ensure such deductions are remitted to the SACCO.

37. It is the duty of the SACCO to have ensured that such deductions were remitted to the SACCO.

38. We find that the Respondent should not be held accountable to deductions or transactions that were beyond his control.

39. We also not that both parties are in agreement with Kshs.966,769/= as confirmed by the Respondent during the hearing of the Respondent case on 16/5/2024.

COUNTER CLAIM 40. The prayers as per the Counter- claim are not properly presented, no justification is given to justify repudiation of the contracts. In this matter the contracts are the Loan Agreement Forms. We find no rationale to consider repudiation of loan agreement forms.

41. As regards prayer on general damage, we find that the claim is not justified since no tabulation or calculations have been filed to justify this prayer.

CONCLUSION 42. This Tribunal is convinced that the Claimant has not adequately presented his case as regards the Kshs.1,171,354/= part of Kshs.2,380,971/= claim.We find that the counter claim is not adequately prosecuted.

43. In view of the above this Tribunal enter judgement in favour of the Claimant against the Respondent and orders the following: -a.Respondent to pay Claimant outstanding loan of Kshs.966,769 with interest at Tribunal rates.b.Counter claim fails.c.No orders to cost.

JUDGMENT SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 30TH DAY OF JANUARY, 2025. HON. J. MWATSAMA DEPUTY CHAIRPERSON SIGNED 30. 1.2025HON. BEATRICE SAWE MEMBER SIGNED 30. 1.2025HON. FRIDAH LOTUIYA MEMBER SIGNED 30. 1.2025HON. PHILIP GICHUKI MEMBER SIGNED 30. 1.2025HON. MICHAEL CHESIKAW MEMBER SIGNED 30. 1.2025HON. PAUL AOL MEMBER SIGNED 30. 1.2025TRIBUNAL CLERK MUTAIMs. Wambua advocate holding brief for the Njuguna advocate for the RespondentShoppers Sacco – No appearanceMs. Wambua advocate: We pray for 45 days stay of executionTribunal orders30 days stay of execution granted.HON. J. MWATSAMA DEPUTY CHAIRPERSON SIGNED 30. 1.2025