Wanyoike v Ekeza Sacco Limited & another [2025] KECPT 232 (KLR)

Wanyoike v Ekeza Sacco Limited & another (Tribunal Case E886 of 2022) [2025] KECPT 232 (KLR) (27 February 2025) (Judgment)

Neutral citation: [2025] KECPT 232 (KLR)

Republic of Kenya

In the Cooperative Tribunal

Tribunal Case E886 of 2022

BM Kimemia, Chair, Janet Mwatsama, Vice Chair, B Sawe, F Lotuiya & P. Gichuki, Members

February 27, 2025

Between

Daniel Ngugi Wanyoike

Claimant

and

Ekeza Sacco Limited & another

Respondent

Judgment

1. Matter for determination is Statement of Claim dated 5/10/2022 filed on 6/10/2022The Claimant claims to be a shareholder with 1st Respondent and registered owner of Title No. Kiganjo/handege/1288Further Claimant avers he had share ownership of Kshs. 100,000/=.

2. On/in April 2017 the 1st Respondent advanced a loan facility to the Claimant to a tune of Kshs. 305,021/= which was secured by Claimant’s shares.The 1st Respondent requested the Claimant to deposit his title deed land parcel no. Kiganjo/handege/1288 in good faith that he would fully service the loan.

3. The Claimant serviced the loan as per the terms and conditions of the facility until the 1st Respondent closed its offices and did not communicate how Claimant was to continue servicing the loan. The repayments Claimant had made as at the time Respondent had closed its office was KShs. 123,970/=

4. Claimant had not been served with any demand notice by 1st Respondent for repayment of the loan balances and he says he was shocked when he was served with a redemption notice together with notification of sale by 2nd Respondent dated 18/8/2022 purports to sell the Claimant’s land parcel no. Kiganjo/handege/1288 to recover loan balance of KShs. 264,886Claimant categorically states the title deed was never a security and neither was it changed to the 1st Respondent.

5. Claimant avers there was a scheduled public auction that was to take place on 7/10/2022 and the 2nd Respondent had not advertised the property for sale.Claimant further stated that the purported penalty of KShs.25, 732/= and accrued interest of Kshs. 17, 036/= were an illegality as Claimant had been servicing his loan till the Respondent closed their offices.Claimant prayers are thus:a.A permanent injunction to restrain the defendants through themselves or their servants or agents from in any way from selling by public auction or any other manner, disposing , advertising, interfering or attempting to evict the 1st plaintiff from property title number title no. Kiganjo/handege/1288. b.An order of injunction to restrain the defendant through themselves or their servants or agents from in any way from interfering or attempting with the plaintiff’s quiet occupation and use property title tittle number Kiganjo/jandege/1288. c.An order directing the 1st defendant to unconditionally release the original title deed for land parcel tittle number Kiganjo/handege/1288 to the plaintiff.d.Any other relief that this Honourable court may deem fit to grant.

6. Claimant filed list of documents dated 5/10/2022 filed on 6/10/2022 which included:a.Demand letter dated 1. 2.2022b.Redemption notice and notification of sale.c.Schedule of loan repayments.d.Copy of the title deed.

6. Claimant’s written statement dated 5/10/2022 was also filed. A further list of documents dated 21/2/2025 was filed on 24/2/2025 which includeda.Plaintiff’s passbook issued by the 1st defendant confirming savings and share ownership.The 1st Respondent filed statement of defense and Claim dated 20/6/2023 who have denied the counter Claim and state that the Claimant’s loan facility was secured by his savings and his parcel of land title no. Kiganjo/handege/1288In the counter claim the Respondent states Claimant was in arrears for KShs. 300,088/=Prays for:a.The plaintiff ‘s suit ageist the defendants be dismissed with costs.b.The plaintiff does pay the loan amount advanced to him plus interest until payment in full.c.That in the alternative the 1st defendant be allowed to proceed to sell the plaintiff’s parcel of land title number kiganjo/handege/1288 by way of auction to recover the outstanding loan amount plus interest until payment in full.d.The costs of the counterclaime.Such further or other relief as the court may deem fit to grant.

7. Respondent filed this list of witness dated 20/6/2023 filed on 6/6/2023 and 1st Respondent list of documents dated 20/6/2023 on 6/6/2023 which included:a.Copy of the plaintiff’s loan repayment account statementb.Copy of the plaintiff’s loan arrears statementc.Any other document with the leave of court.The 2nd respondent did not enter appearance and claimant filed a request for judgment against the 2nd Respondent.The 2nd Respondent herein we note it is an Auctioneer who is an agent who was instructed by the 1st Respondent. The 2nd Respondent must have been acting under the instructions of the 1st Respondent more so on the sale of land no. Kiganjo/handege/1288

8. As such as per the Cooperative Society Act Section 76 they can not be sued and as a Tribunal we do not have jurisdiction to hear the 2nd Respondent if at all the question/issue to be asked was the auctioneer acting as an agent of the decree-holder?The response to this is in the affirmations made as such request for judgment dated 16/11/2023 filed on 22/10/2024 is declined and we order for 2nd Respondent to be struck off.

9. The Claimant filed a response to the 1st Respondent defense and defense to counter claim dated 20/7/2023 reiterating and in Defence to the counter claim.Denied having provided his title no. Kiganjo/handege/1288 as security for the loan facility.Claimant further avers he had shares of KShs. 100,000/= which was used as security of the loan advanced to him of KShs. 305,045/=

10. Claimant reiterated on behest of 1st Respondent is which he deposited his title deed and if indeed the property was security the same would have to be changed and registered in favour of 1st Respondent to secure the loan facility.In response to paragraph 13 counter claim the Claimant avers the government ordered the closure of the 1st Respondent and its sister company Gakuyo Real Estate in March 2018 for flouting the law thereby making the Claimant not to be able to continue servicing the loan.Claimant avers the intended auction of his land was illegal and that the counter claim ought to be dismissed with costs.

11. Matter came up for hearing on 18/2/2025 where Claimant gave evidence by adopting his written statement dated 5/10/2022 as his evidence in chief.He produced his list of documents dated 5/10/2022 and marked (Ex 1-4).On clarification the Claimant stated the balance due to 1st Respondent is Kshs. 189,953 as per (Ex 3)

12. The 1st Respondent did not come for trial despite being informed of the same via the affidavits filed by Claimant sworn by Wambui Kinyajui on 24/1/2025 which the attachment Hearing Notice dated 4/12/2024 Being received by the firm of Messrs. Njuguna Nganga on 20/12/2024As such Tribunal closed the Respondent’s case and their Case and counter claim marked as dismissed.

13. The issues for determination are thus:Issue one1. Whether Claimant owes the Respondent?Issue two2. Whether the land title no. Kiganjo/handege/1288 was used as security?Issue oneWhether the Claimant owes the Respondent?It is not in doubt none from the Claimant’s evidence that he owes the Respondent. He states that he was unable to complete repayment as the Respondent’s offices were closed down and no remittance would be done.

14. Issue twoWhether the land title no. Kiganjo/handege/1288 was used as securityThe Claimant avers he availed his title not as security but as proof of good faith towards repayment of the loan.The R espondent indicates the same was used as securityWe however observe that no evidence has been placed forward by Respondent to confirm the Claimant gave the title as security either through the filling the loan application form that Claimant applied the loan with.Further there is also no evidence of the title no. Kiganjo/handege/1288 had been changed by 1st Respondent.

15. As it is whether or not the title no. Kiganjo/handege/1288 if it was used as security can not be sold to offset the loan as it were because the same was not changed.The 1st Respondent slept on their rights.Secondly, the 1st Respondent have stopped operating and their offices and company remain closedWhere is the Claimant supposed to make payment if at all?For the second issue we thus find the title no. Kiganjo/handege/1288 was not used as security and even if it were the same was not changed towards the loan and thus it can not be sold to realize a defaulted loan.

16. In absence of 1st Respondent attending court to defend or prosecute their counter claim we are inclined to side with the Claimant.UpshotOn a balance of probability, we enter judgement in favour of Claimant against Respondent for:-i.Prayer (a) allowedAn injunction is issued restraining the Respondent through their themselves or their servants or agents from selling by public auction or any other manner, disposing, advertising, interfering or attempting to evict the 1st Claimant from title number title no. Kiganjo/handege/1288ii.Prayer (b)An order of injunction to restrain the Respondent through themselves or their servants or agents from in any way interfere or attempt interfering with the Claimants quiet occupation and use of property title no. Kiganjo/handege/1288iii.Prayer (c)…1st Respondent to release original title deed to land parcel No. title Kiganjo/handege/1288 upon payment of defaulted sum of KShs. 189,453/=Plus costs and interest in the Claim.

JUDGMENT SIGNED, DATED AND DELIVERED VIRTUALLY AT NAIROBI THIS 27TH DAY OF FEBRUARY, 2025. HON. B. KIMEMIA - CHAIRPERSON SIGNED 27. 2.2025HON. J. MWATSAMA - DEPUTY CHAIRPERSON SIGNED 27. 2.2025HON. BEATRICE SAWE - MEMBER SIGNED 27. 2.2025HON. FRIDAH LOTUIYA - MEMBER SIGNED 27. 2.2025HON. PHILIP GICHUKI - MEMBER SIGNED 27. 2.2025Tribunal Clerk J. MutaiNo appearance by the parties.