WEST KENYA SUGAR CO. LTD v NZOIA SUGAR CO. LTD [2011] KEHC 3730 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA

AT KAKAMEGA

CIVIL SUIT NO. 120 OF 2010

WEST KENYA SUGAR CO. LTD. ::::::::::::::::::::::::::::::::::::::::::::::::::::::::: PLAINTIFF

V E R S U S

NZOIA SUGAR CO. LTD. :::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::: DEFENDANT

R U L I N G

1. The Chamber Summons dated 30. 9.2010 is premised on the provisions of Order XXX1X Rule 1 and 2 of the Civil Procedure Rules. In it, the Plaintiff/Applicant seeks orders that;

a)“That this application be certified urgent and service be dispensed with in first instance.

b)That a temporary injunction do issue restraining the Defendant, its Managing Director, agents, servants, employers or any other persons acting on its behalf from impounding or commandeering the Plaintiff’s tractors, trailers or any other property or interfering with the Plaintiffs’ and or its agents’ activities whatsoever including transporting, preparing farms, planting sugarcane or any activities related to the Plaintiff’s business till the hearing and determination of this application interparties.

c)That the Defendant and or its agents be and are hereby ordered to release to the Plaintiff and or its agents motor vehicles (lorry) registration No. KAY 025X, tractor registration No. KAW 944B, trailer No. ZC 8859 and the sugarcane – 8. 7 tones impounded on 28. 9.10 forthwith.

d)That a temporary injunction do issue restraining the Defendant, its Managing Director, agents, servants, employers or any other persons acting on its behalf from impounding or commandeering the Plaintiffs’ tractors, trailers or any other property or interfering with the Plaintiffs’ and or its agents’ activities whatsoever including transporting, preparing farms, planting sugarcane or any activities related to the Plaintiffs’ business till the hearing and determination of this suit.

e)That costs be provided for.”

2. From the Supporting Affidavit sworn on 30. 9.2010 and a Further Affidavit sworn on 11. 10. 2010 by Kannuswamy Theerthanmalal, the following matters are raised;

i)that on 31. 3.2010, 5. 4.2010, 23. 5.2010, 29. 5.2010, 10. 6.2010, 21. 7.2010, 25. 9.2010, and 28. 9.2010, the Defendant’s agents, and/or employees intercepted the plaintiff’s tractors and motor vehicle registration numbers KBC 157 G, KBJ 200 R, KBB 515 T, KBC 160 G, KAT 240 Y, KAY 025 X, KAW 944 B and thereafter commandeered them to the Defendant’s premises and although some were later released, the sugarcane that was being transported to the Plaintiff’s factory was never recovered.

ii)that the sugarcane was being transported lawfully and the drivers of the tractors and motor-vehicles had the cane contracts and/or letters from the Chief and/or land search certificate indicating that the sugarcane was lawfully obtained.

iii)that as at the date of filing the Application, tractor registration number KAY 025 X and motor-vehicle registration no. KAW 944 B had yet to be released together with 8. 7 tones of sugarcane.

iv)that as a result of the Defendant’s unlawful actions, the Plaintiff and its contracted cane farmers stand to suffer irreparable loss and damage.

3. That the injunction should therefore be granted to secure the Plaintiff’s business interests from the destructive actions of the Defendant, its agents and/or employees.

4. In response, the Defendant filed a Replying Affidavit sworn on 4. 10. 2010 by Benson Khatwenge, its Company Secretary and its case can be summarized as follows;

5. That at no time did it impound any of the tractors or motor-vehicles alleged by the Plaintiff and that if any of them were impounded, then that was the work of the police and that was because the Plaintiff was interfering with the Defendant’s “nucleus farms and/or outgrowers being loaded with sugarcane in which the Defendant company has heavily invested in terms of ploughing and farm inputs.” Further, that the Plaintiff through its agents and/or servants have interfered with the Defendant’s operations by poaching and [encouraging] the breach of contracts by the Defendant’s outgrowers” by alleging that the canes were being sold to it by private cane owners.

6. Another point raised by the Defendant is that the present suit is “sub judice”, a misnomer in any event, but further that the dispute before this court should be resolved in the Sugar Arbitration Tribunal as established under the Sugar Act.

7. I note that since the Defendant categorically denied having impounded motor vehicle registration no. KAY 025 X and tractor registration number KAW 944 B, on 5. 10. 2010 I ordered the release of the two vehicles from whoever had their custody, a matter that remains contested because in his latter Affidavit, Kannuswamy Theerthomalai still insisted that the Defendant still  had custody of them but had refused to release them inspite of the court order.

8. Before going to the merits of the Application, I deem it fit to deal with the issue of jurisdiction first. I have perused the Sugar Act No. 10 of 2001 and I note as follows; S. 31 provides that;

“(1)There is established a tribunal to be known as the Sugar Arbitration Tribunal for the purpose of arbitrating disputes arising between any parties under this Act

(2)The Tribunal shall consist of-

(a) a chairman who shall be a person qualified for appointment as a judge of the High Court of Kenya and

(b) two other members, being persons with expert knowledge of the matters likely to come before the Tribunal and who are not persons with a direct material interest in the sugar industry, all of who shall be appointed by the Minister in consultation with the Attorney General..”

(3)The members of the Tribunal appointed under subsection (2) shall hold office for such period, not exceeding three years, on such terms and conditions as shall be specified in the instrument of appointment but shall be eligible for re-appointment for one further term of a period not exceeding five years.

(4)The provisions set out in the Third Schedule shall have effect with respect to the meetings and procedure of the Tribunal.

(5)Except as provided in the Third Schedule, the Tribunal shall regulate its own procedure.”

9. It is agreed that the parties to this suit are also parties to the Act because the dispute relates to matters between “millers” and “outgrowers”  within the meaning of the Act. It follows therefore that, whereas this court has unlimited original jurisdiction in matters of a civil nature, the present dispute would best be settled at the Sugar Arbitration Tribunal.

10. In any event, having looked at the Application before me and the way it is framed, once I ordered the release of motor vehicle registration number KAY 025 X and tractor registration number KAW 944 B, there is little else to be said because the remaining prayer is ambiguous, and I cannot issue orders in anticipation of an unknown event predicated on not a single certain clear and known event. A blanket order as is sought in prayer (d) cannot determine the sugar wars between the parties and the Tribunal is best suited to do that.

11. Further, it would seem that the parties are fighting over control of sugarcane in the Misikhu area and the Defendant seems to hold the Plaintiff as the aggressor and whatever the merits of that argument, I cannot in the Application before me see that an order in the words of the prayer (d) aforesaid is untenable in the present circumstances.

12. In the event, while dismissing the Application dated 30. 9.2010 save for prayer (c), let each party bear its costs and they should move to the Tribunal if they are minded to do so.

13. Orders accordingly.

Delivered, dated and signed at Kakamega this 22nd day of February, 2011

ISAAC LENAOLA

J U D G E