Visionpoint Sacco Ltd v Matibo Dairy Co-operative Society [2023] KECPT 733 (KLR)

Visionpoint Sacco Ltd v Matibo Dairy Co-operative Society (Tribunal Case 621 of 2019) [2023] KECPT 733 (KLR) (17 August 2023) (Ruling)

Neutral citation: [2023] KECPT 733 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case 621 of 2019

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

August 17, 2023

Between

Visionpoint Sacco Ltd

Plaintiff

and

Matibo Dairy Co-Operative Society

Defendant

Ruling

1. The matter for determination is an Application dated 13. 06. 2022 filed on 15. 06. 2022, under Section 3, 3a and 63(c) of the Civil Procedure Act, Order 10 Rule 11, Order 45 of the Civil Procedure Rules. The Applicant sought the following orders:a.Spent.b.That the Interlocutory Judgement entered against the Defendant be set aside and or any other consequential orders arising therefrom.c.Stay of Execution of Decree against the Defendant pending determination of the Application.d.The defendant be allowed to file its Memorandum of Appearance and Defence in the suit.e.Costs.The Application is based on the grounds that an Interlocutory Judgement was entered and a decree issued against the Defendant; and Warrants of Attachment have been obtained by the Plaintiff who consequently conducted a proclamation of the Applicant’s property. The Defendant claims to have not been served with Summons to enter appearance and that their Defence raises triable issues. The Application was supported by a Supporting Affidavit, dated13. 06. 2022, filed on 15. 06. 2022; sworn by Abraham Nyangau Magubo, the Secretary of the Applicant. The Plaintiff filed submissions dated 26. 01. 2023, filed on 05. 04. 2023, in response to the Application. They submitted that the Defendant was properly served with the relevant documents pertaining to the suit.

2. Issues for determination. Issue One - a. Whether the defendant was served.An Affidavit of service produced by the Plaintiff, sworn by Joseph Mogaka Moemi an authorized Court Process Server, dated 26. 10. 2020; shows that the Process Server received the Summons and Plaint of this suit on 21. 01. 2020 from the firm of Samuel.N. Mainga & Co Advocates. Upon reception of the documents, he on 21. 01. 2020 at 8:45 A.M, served the Respondent’s Secretary Mr. Abraham Magubo. The Plaintiff also produced a Notice dated 14. 10. 2019, notifying the Defendant of the suit against him.These provide sufficient evidence that the Defendant was sufficiently served and notified of the suit. The Defendant was hence served.

Issue Two - b. Whether leave to file a Memorandum of Appearance and a Defence should be grantedThe Defendant claimed to not have been served and so they were not able to file a Memorandum of Appearance and a Defence. But, from issue (a) above, it is clear that they were served. They also filed their Defence together with the Application, which they alleged raises triable issues.In the case of Saudi Arabian Airlines Corporation v Sean Express Services Limited, Civil Case no 79 of 2013 [2014] eKLR, it was stated that;“A triable issue need not be one which will succeed but one that passes the Sheridan J Test In Patel v E.a. Cargo Handling Services Ltd. [1974] EA 75 at P. 76 (Duffus P.) that “…a triable issue …is an issue which raises a prima facie defense and which should go to trial for adjudication.” Therefore, upon looking at the defense, it raises bona fide triable issues worth a trial by the court.The Court of Appeal observed in James Kanyiita Nderitu &another [2016] eKLR, there is little option for a court but to set aside such a judgment. The Court stated:“In a regular default judgement, the Defendant will have been duly served with Summons to enter appearance or to file Defence, resulting in default judgment. Such a Defendant is entitled, under Order 10 Rule 11 of the Civil Procedure Rules, to move the court to set aside the default judgement and to grant him leave to defend the suit. In such a scenario, the court has unfettered discretion in determining whether or not to set aside default judgment, and will take into account such factors as the reason for failure of the Defendant to file his Memorandum of Appearance or Defence, as the case may be; the length of time that has elapsed since the default judgment was entered; whether the intended Defence raises triable issues; the respective prejudice each party is likely to suffer and whether on the whole it is in the interest of justice to set aside the default judgment”.

3. Although the Defendants were negligent with defending the suit, their Defence does raise triable issues which are; whether the Defendant was a borrower of the Plaintiff, and whether the suit property, Nyaribari Masaba/Bonyamasicho/1640, which the Plaintiff is asking forfeiture of. The Defendant also did not wait too long since the default judgement was entered to seek stay of judgement. If the default judgement is not set aside, the Defendants will be prejudiced, as they will lose the property Nyaribari Masaba/Bonyamasicho/1640, which had not been listed as collateral for the loan. The court therefore exercises its discretionary power and allows the Defendant to file their Memorandum of Appearance and Defence.

Issue Three - c. Whether a stay of execution should be granted.After consideration of issue (b) above; relying on Order 10 Rule 11 of the Civil Procedure rules, it is in the interest of justice, to stay execution of the Default Judgement entered against the Defendant.

UpshotThe Application dated 13. 6.2022 is found to have merit and is allowed in terms of :a.That the Interlocutory Judgement entered against the Defendant is set aside and or any other consequential orders arising therefrom.b.Stay of Execution of Decree against the Defendant is hereby allowed pending determination of the Application.c.The defendant is allowed to file its Memorandum of Appearance and Defence in the suit.d.Each party to bear its own cost.e.Respondent to file and serve Statement of Defence, Witness Statements and List of Documents 14 days from today. Failure to which the Interlocutory Judgment shall stand.f.Mention for Pre-trial directions on 20. 11. 2023.

RULING SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 17TH DAY OF AUGUST, 2023. Hon. Beatrice Kimemia Chairperson Signed 17. 8.2023Hon. J. Mwatsama Deputy Chairperson Signed 17. 8.2023Hon. Beatrice Sawe Member Signed 17. 8.2023Hon. Fridah Lotuiya Member Signed 17. 8.2023Hon. Philip Gichuki Member Signed 17. 8.2023Hon. Michael Chesikaw Member Signed 17. 8.2023Hon. Paul Aol Member Signed 17. 8.2023Tribunal Clerk JonahMs. Magona advocate holding brief for Mr. Mainga for plaintiff/Respondent.Mosomi advocate for Defendant/Applicant- no appearanceHon. J. Mwatsama Deputy Chairperson Signed 17. 8.2023.