Simeon Macharia v Sauti Housing Sacco Society Limited [2021] KECPT 527 (KLR)

REPUBLIC OF KENYA

IN THE CO-OPERATIVE TRIBUNAL AT NAIROBI

TRIBUNAL CASE NO. 271 OF 2015

SIMEON MACHARIA.................................................................................CLAIMANT

VERSUS

SAUTI HOUSING  SACCO  SOCIETY  LIMITED............................RESPONDENT

JUDGMENT

What  is  before  us for  consideration  and determination  is the Respondent’s  Notice  of Preliminary  Objection  (“ the P.O”)dated 3. 12. 2020 seeking  for the entire  claim  to  be struck  out based  on the following  grounds:

1.  An order  of specific  performance  of contract  compelling  the Respondent  to complete  sale of the said plot No. 1757 being part  of sub-division  of Title  No. Nairobi Block  82/4264 and  to  execute  all the necessary  documents  so as  to effect  the transfer  in respect  thereof.

2.  An order  of refund  of the said sum  of kshs.30,000/= with interest  at court  rates  with effect  from  31st  July,  1996 till payment  in full;

3.  An order that  the Respondent  do refund  to the Claimant  a sum of Kshs.85,000/= being  his accumulated savings  during  his membership with the Respondent; and

4.  Costs  of the suit  with  interest  at court rates.

Vide the  directions  given  on  5. 11. 2020,  the Preliminary  Objection was  canvassed  by way of  written  submissions.  The Respondent  filed  its  written  submissions  on  4. 12. 2020 while  the Claimant  did so on  17. 2.2021.

RESPONDENTS  CONTENTION

The Respondent  has premised  the Preliminary  Objection  on grounds  that:

a.The issues  raised  and the orders  sought  in the suit are  res judicata, the same  having been directly  and substantially  in issue between  the same parties  in Milimani CM.CC.NO.11646 of 2006;

b. That to the  extent  that the suit  seeks  for an order  of specific  performance  compelling  the Respondent  to cause  a sub-division  of Title  No. 82/4264 cannot  issue in law because  the said title does  not  exist  having been  already  sub-divided and the Respondent  is no longer   in control;

c. That  the issue  of withdrawal  of membership and refund  of savings  is governed  by the Respondent’s by-laws and therefore the instant claim was  been instituted  prematurely, and

d. That the Tribunal  does not have  jurisdiction  to handle  matters  relating  to the use,  occupation  and title  to land.

Whilst referring to the holding of the court  in the case  of Mukisa  Biscuits  Manufacturing  Company  Limited –vs-  West End  Distributors  Limited[1969] EA 696,   the Respondent  submitted  that  the  instant preliminary  Objection  is competent  as the factual  circumstances  that informs the said  objection  are not  only uncontested  but also  arise  from the pleadings  before  the court.  It  cited  the decision  of the court  in the case of  Peter Nganga Mwaura  -vs-  Alfred  Mbugua  Ngugi & Another [2017] eKLR to buttress  this point.

Coming  to the merits  of the Preliminary  Objection  and whilst  addressing  the issue of  jurisdiction,  the Respondent  cited the celebrated  case of  The owners of the motor vessel “Lillian S” – vs-  Caltex  Oil  Kenya  [1989] KLR- 1and  submitted  that the  Tribunal’s  jurisdiction  under Section  76  (2) of the Co-operative  Societies  Act  (Cap 490) laws of Kenya does  not extend  to the use,  occupation and title  to land as envisaged  by Article  162 (2) (b) of the Constitution.

That  the Claimant  herein,  being a  member of the Defendant entered  into  a sale Agreement  for purchase  of  Plot  No.  601, 647 and 1757. That  the Claimant  made payment  to  the plots  as follows:

a. Plot  601- kshs.80,000/=

b. Plot 647- Kshs.50,000/= and

c. Plot  1757- Kshs.15,000/=.

That  the above  payments  went towards  deposit  of the said  plots.  That he, however did not complete  payment  for  the said  plots.  That  the plots were repossessed  subsequently. That it is on this basis  that the Claimant  has  originated this claim.  That the  Tribunal  does not have  jurisdiction  to grant  the orders  sought herein. That  then the court’s jurisdiction  under  Section  76  of Cap 490 is only limited  to debts  or demands  does  as  against  a member.

REFUND  OF DEPOSITS

On refund  of deposits  the Respondent  contend that  its  by-laws  provides  for a  clear  procedure  to be followed  by a member  when he/she  wants  his/her  deposits  refunded.  That the  same  cannot happen  as  the  Claimant is  still  its member.

CLAIMANT’S  CASE

The Claimant  has opposed   the Preliminary  Objection  principally  on the ground  that it  does not  meet the threshold  for a Preliminary  Objection. Whilst  referring  to  the case of  Mukisa  Biscuits  Company Limited  - vs-  West End  distributors  Limited (supra), the claimant  submitted  that the  Preliminary  Objection raises  factual  issues which  require  investigation. That  the  said factual  issues include:

a. That the Respondent  had offered  three plots  for sale namely,  plot No. 601, 641 and 1757  and  whether  the Claimant  paid for  the same;

b. Whether  the Claimant  withdrew  his membership from the Respondent; and

c. Whether  or not the Respondent  had offered  plot No. 1757 as was held in  CM.CC.NO.11646/06.

That owing  to this  it is  best  that he claim  be heard on  merits.

RES JUDICATA

The Claimant  has opposed  the contention  that the suit  is  Res Judicata because  of the following  reasons:

1.  That  in the  earlier  suit there was  no claim  for refund  of his  deposit;

2.  That the Chief Magistrate’s court  in which  the former suit  was  instituted  has no jurisdiction  to  hear and  determine  the matters  raised  in this Application.

ISSUES  FOR DETERMINATION

We have framed  the following  issues  for determination:

a. Whether  the Respondent’s  Notice  of Preliminary  Objection  dated  3. 12. 2020 is meritorious  and should therefore  succeed; and

b. Who  should meet  the costs  of  the preliminary objection.

JURISDICTION

The Respondent  has sought  for entire  claim  to be struck  off on the ground that the Tribunal  does not  have jurisdiction  to entertain  the same.  The Respondent  has anchored  the Preliminary Objection  on  the following  grounds:

a. That the matters  raised  in the instant  claim  are Res judicata,the same  having  been directly  and substantially  in issue  in Milimani CM.CC.NO.11646/2006;

b. That  to the  extent  that  the suit  seeks  for an order  of specific  performance  compelling  the Respondent  to cause  a sub-division  of Title  No. 82/4264 cannot  issue  in law because  the said  title does  not  exist having  already  been sub-dividend  and the Respondent no longer  in control.

c. That the  issue of  withdrawal  of membership and refund  of deposits  is governed  by the Respondent’s  by-laws  and therefore  this claim  has  been instituted  prematurely; and

d. That the Tribunal  does not  have jurisdiction  to handle matters  relating  to the use, occupation  and title to land.

As  was rightly submitted  by the Respondent, jurisdiction  is everything and without  it, the court has no  choice  by  to down its   tools.  We   rightfully  associate ourselves  in this  regard with  the holding  of the court  in the case of  the Owner  of Motor “Lillian S”- vs-  Caltex  Oil  Kenya  Limited [1989]KLR -where   the court held  in the pertinent  part thus:

“ Jurisdiction   is everything, without  it a court  has no  power  to make  one  more  step. Where  a court has  no jurisdiction  thee would be  no basis  for contribution  of proceedings  pending  other evidence. A court  of law  downs  tools  in respect  of the matter before   the moment  it holds,  that it  is without  jurisdiction..”

As was  rightly submitted  by  the parties  also,  the case of  Mukisa  Biscuits  - vs-  West End  Distributors sets the law relating  Preliminary  Objections. We cite  the pertinent  part  as follows:

“...A preliminary  objection  consists  of a point  of law which  has been pleaded, on which  arises  by clear implication  out  of pleadings  and  which  of  argued  as a Preliminary  point,  may dispose  of the suit.”

Further  Sir, Charles  Newbold Jnr.  Held  at page  701 thus:

“ A Preliminary  Objection  - raises,  a pure point  of law which  is  usually  on the assumption  that all the  facts  pleaded  by  the other side  are  correct. It cannot  be raised  if any  fact  has to be ascertained  or if  what is sought  is the  exercise  of judicial  discretions..”

Clearly  and as rightfully submitted  by the Plaintiff  the court in the  Mukisa  Biscuits  Case set  out the following  facts   to be considers  before  allowing  a Preliminary  Objection:

a. That the  objection  raises  a pure  point of law;

b. That the  facts  pleaded  are correct; and

c. That  the is no  fact  that  pleads  to be  ascertained.

With  these principles   in mind,  a question  abound  as to whether  the instant  objection has satisfied  the said principles. We  look at  each of the issues  independently as follows:

RES JUDICATA

The  Respondent  contend  that the matters  raised  in the  instant suit  are similar  to those raised  in CM.CC.NO. 11646/2006. The Claimant  has disputed  this  fact.  This becomes  a fact in  issue which  requires  investigations.  The Respondent  has annexed  the pleadings  in CM.CC.NO. 11696/2006 to the Preliminary Objection.  A question  arises  as to whether  this is the correct  procedure  of introducing  documents  in court. Our answer  is in the negative.

It is our  finding  that the  issue  of res judicata is not easily  ascertainable  from the  pleadings  as the Respondent  would want  us to believe. It is  a contested  fact  which  can only  be proved  as way  of Affidavit  evidence  of production of  documents  during hearing. This  is not the  case in the  current  Preliminary  Objection. It is that  our finding  that  the  issue of  Res judicata is not a pure  point  of law  as to invite  as to strike  out to claim.

WITHDRAWAL OF MEMBERSHIP

Without  delving  much  into this  issue,  we apply  our reasoning  above  and find that  the issue of  whether  or  not to Claimant is a member  of  the Respondent  so as  to qualify  to  demand for  refund  of savings/deposits  is not a matter  to be canvassed  by  way of  Preliminary  Objection.  Equally,  the issue  as  to whether  or not  there is  a  dispute  resolution  mechanism anchored  on the  Respondent’s  by-laws  is not  a matter  to be raised  in a Preliminary  Objection.

JURISDICTION  ON LAND  USE,  AND ISSUANCE OF TITLE

Again  as to whether  the matter  before the  Tribunal  re....to  land  use  and  title  to land,  evidence must be led.  It is not  within  the  preview  of a preliminary  objection.

CONCLUSION

The upshot  of the foregoing  is that we  do not find merit  in  the Respondent’s Notice  of Preliminary  Objection  dated 13. 12. 2020 and hereby  dismiss  it with costs to the Claimant.

Ruling signed, dated and delivered virtually this 6thday of May, 2021.

Hon. B. Kimemia                  Chairperson                ...................................

Hon. J. Mwatsama              Deputy Chairperson  ....................................

Mr. P. Gichuki                       Member                    ....................................

Tribunal Clerk                       .............................