William Njiraini Nguru v Mununga Tea Factory , Returning Officer Mununga Tea Factory , Kenya Tea Development Agency Ltd & Patrick Karimi Muthii [2015] KEHC 6110 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT KERUGOYA

ELECTION PETITION NO. 1 OF 2015

WILLIAM NJIRAINI NGURU …………...……………….PETITIONER

-VERSUS-

MUNUNGA TEA FACTORY………….……………1ST RESPONDENT

RETURNING OFFICER MUNUNGA

TEA FACTORY ........................................................2ND RESPONDENT

KENYA TEA DEVELOPMENT AGENCY LTD…......3RD RESPONDENT

PATRICK KARIMI MUTHII………………….……….4TH RESPONDENT

RULING

WILLIAM NJIRAINI NGURU, the petitioner/applicant herein has moved this court vide a Notice of Motion dated 21st January 2015 for the following reliefs:

That  this court do issue an order restraining  the confirmation of Patrick Karimi Muthii  the 4th respondent herein, as the Director Mununga Tea Factory Ltd  of MUKURU SOUTH  ELECTORAL AREA passing debating, or adopting agenda NO. 5(b)  in  the annual General Meeting  which was  scheduled  for 26th January,2015 for Mununga Factory Company Limited  pending  hearing and determination of  this petition herein.

That this court do order the 2nd respondent to produce the voting register and all proxy forms, and all records or documents used in the voting process in the elections of 6th January, 2015.

That this  court do order a recount  of the votes cast  personally and by proxy  at all the four polling stations  and that counting be done in the presence of the applicant  herein.

That costs be provided for.

The petitioner/applicant has listed ten grounds in the face of the application which are supported by his affidavit sworn on 21st January 2015.   He contends that the elections conducted on 6th January 2015 to get a director of Mununga Tea Factory Limited were not done in a fair and just way and that the elections were riddled with irregularities and anomalies.  These can be summarized as follows.

That the elections of 6th January 2015  were not  free and fair as the 4th respondent obtained proxy forms and power of attorney  signatures before other contestants  including  the applicant therefore  giving him unfair advantage  over  the others.

That there  was conflict of interests involving  the 4th respondent whose wife  alleged to be an  employee  of  1st respondent, participated in the election exercise  and that she  took part in counting  of votes at Gathambi polling station.

That some of the petitioners  voters were denied  right to  vote  and gave the  example of a one David Karimi Kanegeni as one who could not vote due to mix ups  and malpractices  in the use of proxy  forms .

That some dead voters  allegedly took part  in the election exercise  and gave the following  names Stephen Nderitu Mugo, Laban Munene, Edward Mundia, Muriithi Kabugu , Muthii Kamwenje and Michael M. Waru as deceased persons who allegedly voted posthumously.

That there were malpractices witnessed in the use or misuse of power of attorney forms some of which led to double counting of votes and fraud.

That the elections conducted given the environment under which they were conducted were not free and fair and it only just if scrutiny is done recounting of votes as per the valid register is done.

Miss Thungu  counsel for the applicant reiterated  the above grounds and added  that a production of voters  register  could provide an insight  as to who actually voted and whether  the number of votes casted  indicated  the number of shares held by the voters as it was not a one man one vote exercise.  She also submitted  that the reliefs being sought  in this application being injunctive  in nature  were necessary  and just as damages  would not  be adequate  if the petitioner eventually succeeds  in his petition .  The reasons given by M/S Thungu, is that the applicant is a previous director and held the position for service rather than for monetary considerations.  She further pointed out the balance of convenience tilts in favour of granting the reliefs sought and that granting the petitioner a chance to serve a director in the meantime will not prejudice the respondents in any way.

The 1st, 2nd and 3rd respondents through Mr Ngigi had strongly opposed this application.  The 1st to 3rd respondents relied on affidavit of KENNETH MAVALE sworn on 10th February 2015.  According  to the deponent  of that affidavit, the elections  which is the subject  of the petition  herein  were conducted  in a transparent  and fair manner  with the results  being declared  in the presence  of the candidates  and their agents.  According to him, there were no reports of irregularities or any anomaly at any of the centres where the elections were conducted. The  1st to 3rd respondents  faulted  the applicant  for falsehoods  exhibited  in his affidavit  in support  of his application .They have pointed out  for instance that contrary to what the applicant  claims, there were proxy forms  available  for collection by all candidates  on 19th November, 2014.  They have annexed a notification that was sent out and marked it “KMI”.

On the issue of proxy forms, the 1st  to 3rd respondents have submitted  that proxy forms  are always  given or supplied to growers who would not in a position to physically  go and vote   at a polling centre  and it was not possible  to supply the same to candidates  in the elections.

Mr Ngigi for the 1st to 3rd respondents faulted the application before me for being an afterthought and demonstration of a sore loser.  He contended that the applicant has not provided specifics of his complaint but just out on fishing expedition  looking for evidence to turn the tables against the victor, the 4th respondent herein.  He took issue with the applicant for saying he learnt of election malpractices  from his “agents” but did not specify which agent  and on which date did  he learn  of the same since the agents signed  tallying forms  from all the tallying  centres as  exhibited  in annextures  marked “KM3”.

Mr Ngigi further opposed the application saying that the prayers sought in the application are irregular as they are hamped together instead of being alternative prayers.

On the issue of  conflict  of interest  and the allegations  of the involvement  of 4th respondent’s wife on the election, the 1st  to 3rd respondent  have denied  the same saying that no formal complaint was received  prior or  during the election  about any impropriety  by the wife  of the 4th respondent  whom they admitted was an employee  but added that she is a  grower herself  and has a right  to participate  in the elections  like other growers.  They have however disputed the fact that she participated in the tallying of votes saying the same is false.

On  the allegation of dead voters, the 1st to  3rd respondents denied  the submissions  made by the applicant saying that  no  prove  has been given to  show that the dead participated in the voting exercise  either  posthumously or otherwise  by proxy.

The 1st to 3rd respondent in opposition to the reliefs being sought in the application have contended that the petitioner has failed to show that he has a prima facie case or that he would suffer irreparable harm if  injunction  is not issued. In support of this contention, Mr Ngigi quoted two authorities in the case of EAST AFRICAN DEVELOPMENT BANK –VS-HYUNDAI MOTORS K.LTD (2006) e KLR and the case of NICHOLAS MAHIHU –VS- NDIMA TEA FACTORY LTD & ANOTHER (2009) e KLR.

The 1st  to 3rd  respondents have also faulted  the applicant for seeking equitable remedies  with  unclean hands  as demonstrated  by the affidavit of one Albert Munene Kinyua  and opines that the  contents of paragraph 22  of the said  affidavit are contradictory  and misleading  and that if  there was any fraud  in the use of proxy forms  then the same were perpetuated  by donors affiliated  to the applicants.

Finally the 1st to 3rd respondents submitted through their counsel that the position of a director is salaried and the remuneration can be ascertained therefore damages suffered can easily be computed and compensated given if the elections are reversed by this court.

The 4th respondent through Mr Abubakar advocate, also opposed the application associating himself with the sentiments expressed by the 1st to 3rd respondents.  The 4th respondent, through his affidavit sworn on         10th February, 2015 deponed inter alia that the elections that saw him being declared the victor, was done in a transparent manner.  He has faulted the applicant for peddling lies and making baseless allegations which to him are quite unfounded.

Mr Abubakar contended that the application is a non starter as the petition filed is incompetent and bad in law. He pointed out that as framed  the petition is presented  as though it is an election petition  under the  Elections Act of  2011 when it is obviously not and that  the petition  is unsupported by a verifying  affidavit  or any evidence  supporting  it.   According to Mr Abubakar the application is introducing extraneous matters to the petition as the petition makes no claim of proxy forms.   The 4th respondent has faulted the application for seeking to amend the petition irregularly which is incompetent.  He has quoted the case of OSORE OGUTU –VS- MICHAEL ONYURA ARINGO & 2 OTHERS (unreported) and CHARLES OIGARA MOGERE –VS- CHRISTOPHER MOGERE OBURE & 2 OTHERS (2013) e KLR to buttress this argument and further that a recount of votes ordinarily cannot be ordered without the actual petition seeking the same remedy.

The 4th respondent  has also pointed out that the applicant  did not raise  any complaint  or channel it to the right channel   as provided  by the election  regulations  as annexed  by the applicant  as “WNN2” in  his affidavit in support of his application now before court.

The 4th respondent has further shielded his wife from blame saying that she was proceeding on normal leave contrary to averments from the applicant. The 4th respondent has alleged that DAVID KARIMI KANEGENI informed him that  he was not going to be present during  the voting exercise and   was given proxy forms  which  he executed  willingly  and upon execution of proxy forms  he could not  be allowed to vote  again during the voting exercise .

On the issue of dead voters, the 4th respondent submitted that one of the dead persons named is actually his deceased father MUTAHI KAMWENJI and there is no evidence to show that he voted.  The 4th respondent further contend that the tallying of voters was done openly and the same showed that he had won by a huge margin of 7000 votes.  Therefore there was no doubt as to who won the elections and that is why he was issued with a certificate to certify that he was a director elect.

The 4th respondents contended  that the affidavit of ALBERT MUNENE is perjourous  and should  not be relied as all agents  signed  tallying  forms in election centres  showing that the election  exercise  was  conducted  smoothly and without

On the issue of  the  balance of convenience  the 4th respondents has contended that  the same tilts  in his favour and that Mununga Tea Factory  deserves to be led by a popularly elected director and according to him, he is that director.

I have considered all the affidavits filed in this petition in support of the application.  I have considered the submissions made by M/S Thungu counsel for the petitioner/applicant herein.  I have also considered the rival submissions made  by all the respondents herein and the submissions  made by Mr  Ngigi counsel for 1st to 3rd respondent  and Mr Abubakar  counsel for the 4th respondent.

Although  the Notice of Motion before  does not state  the provisions  of the law under which  the same is  brought, the petition as presented  invokes  the provisions of Elections Act, 2011 and the Judicature Act cap 8 Laws of Kenya.  The notice  of motion of course  is hinged  on the petition  itself and the question that seemed to have  bothered the petitioner  herein  is whether  or not the Elections Act does apply to elections outside  the general elections  in this country.  To put  the matter to rest, the Elections Act 2011  is defined as an Act of parliament to provide for the  conduct to the office of the President, the National Assembly, the Senate, County Governor and County Assembly to provide for the conduct of referenda, to provide  for election dispute  resolution and for connected  purposes.  The Act  or Statute  is therefore  specific to elections to the office of  the President, the National Assembly, the Senate, County Governor and County Assembly members only.  With due respect to the counsel for the applicant  election of directors  in a company  like  other elections  in other bodies  is not applicable here.   Companies  and  other registered bodies  and Societies  have their own regulations and rules that govern  elections of various  offices  and positions I will come back to issue and the relevant laws governing elections which is the subject  of this petition later  in this ruling.

Let me turn my attention to the reliefs sought in the application before me.  The reliefs  being sought  in my view are injunctive  both prohibitory  and mandatory  in nature  .  And  being injunctive, the  normal principles  of injunctions  does apply and  there is no better  case law  on injunction  than  the famous case  of GIELLA –VS-CASSMAN BROWN & CO. LTD (1973) EA page 358 . The conditions for the grant  of interlocutory  injunction  are now well settled.  First an applicant must show a prima facie case with a probability of success.  Secondly an interlocutory injunction  will not normally be granted unless  the applicant might otherwise  suffer  irreparable injury, which would not  adequately  be compensated  by an award of damages.  Thirdly if the court  is in doubt , it will decide an application on a balance of convenience .  The above is the threshold  that an applicant coming to a court of law must  of essence  satisfy before qualifying  to be granted the remedies  of injunction.

Now let me examine  the case or the petition  filed in  this case and see if  the same  as it stands  has demonstrated  a prima facie case with a probability  of success .  The  respondents  in unison submitted that the  applicant’s  petition  does not establish  a case infact,  the  4th respondent raised  the issue of  competence  of the petition from the onset pointing out that  it was defective and incompetent.  Mr Abubakar submitted that the petitioner cannot invoke the Election Act  2011  and I  agree as  I have indicated above. But perhaps more importantly the petition is unsupported.  There is  no affidavit  supporting it and  for good measure, M/S Thungu admitted that Elections Act was erroneously invoked  and that the issue of verifying affidavit can be  cured  through an amendment  and  filing of affidavits.  The petitioner however never said anything on the statements  but assuming that the petition was  a normal suit  or that the petitioner  actually wanted to file a suit on the basis  of grievances pointed  out, then what would  automatically follow is the legal requirement to comply  with Order 3 Rule 2  and Order 4 Rule 2 (2) of  the Civil Procedure Rules which is a compulsory  requirement.  In  the absence  of this, I am afraid the  issue at hand now  is not even whether  the petition as it stands  or presented  stands the risk of  being struck out in accordance  with Order 4 Rule  1(b) of the above rules cited,  but perhaps what even bedevils  the petition  application  before me the more  is the inapplicability of the  Elections Act, 2011 as stated above.  The impugned  elections herein  related to elections of a director  of a company- the 3rd   respondent herein .  The management of companies  whether  private or public  is  governed by the Companies Act ( Cap 486 Laws of Kenya).  Election of directors  and other management issues  are internal issues that  are usually regulated by rules and regulations embedded   in the articles of association and memorandum of association.  Mr Abubakar is correct  to point out that the applicant disregarded  internal  mechanisms of first  dealing with complaints  that may have arisen during the election exercise.   The applicant has himself  annexed  the regulations  that were properly given out by the 3rd respondent and exhibited them  as “ WNN 2”.  I have  gone through  the regulations  and tellingly at page 11 of the said regulations, internal mechanisms  or avenue is provided for anyone  with any complaint  on the election process.  There is a body  ( Dispute Resolution Committee) constituted  to address such complaints  and it  would appear that avenues are provided  to those who may be dissatisfied  with the decision of the dispute resolution committee  which is  a court  of law.   No evidence  was presented  before me that the applicant  did exhaust  the internal mechanism  before coming to this court. The applicant  did not also allude  any difficulty or reservations  he had or could have  had on the avenue  provided for  by the 3rd respondent in dealing  with his complaint.  Courts of law  are normally  reluctant to enter  into the arena of disputes that arises from internal management  of companies especially where the internal mechanism  are proved  to deal with such disputes. In the case of MILKA ADHIAMBO OTIENO &ANOTHER –VS- ATTORNEY GENERAL & 2 OTHERS (2012) e KLR , the respondents  raised a jurisdictional  point that the court lacked  jurisdiction to entertain  allegations of election malpractices that were alleged to have occurred during election of directors  to the board of directors  .  Their argument  was based on Regulation 13 (2) of Sugar ( Elections ) Regulations  2002 which  provided that all disputes  arising  out of an election under sugar( elections) Regulations shall be lodged with a tribunal set up under the regulations .  The  court held as follows:

“ We therefore find and hold that the issue squarely lies  within the jurisdiction of the Sugar Tribunal .  It therefore follows that thepetitioners  ought to  have preferred any complainants of electionmalpractices to the said Tribunal  in the first instance”.

The above  ratio decidendi  is apparent  in the case of PAOLO MURII –VS- GIAN BATTISTA MURRI & ANOTHER (2000) e KLR  where  the court held  the view that  the appointment  of directors  in a company  is regulated by the companies  Articles of Association and further observed as follows:

“ The petition makes no allegation that the Articles of Association have been  breached  or any appointment  made unlawfully.  Upona careful consideration of the petition  it is plain and obvious thatbasically  this is a dispute  about internal management  of  thecompany  and a court does not interfere  with internal managementof the company  acting  within its powers:  See Rule in FOSS-VS-HARBOTTLE (1843) 2 HAKE  261 to see exceptional  circumstanceswhere  court’s intervention  is allowed e.g ultra vires, fraud e.t.cwhich have not been pleaded” (sic)

In view of the above authorities  though it is  true that  the applicant’s petition  raises arguable issues but  without the necessary amendments  and compliance  with the rules  as pointed out above it may not  see the light of day.

It is also important to note that  it is a well established  rule of evidence that whoever asserts a fact  is under obligation to prove  in order to succeed.  The applicant has made a number of serious allegations including  the issue  of dead voters coming back to  vote in the impugned election  exercise but without proof at this stage  of the proceedings I am unable to make any finding.  The applicant though still has a chance to table  facts  proving that the elections  were indeed  marred  by election malpractices.

It is also important  to make a finding  on whether  damages  could be adequate compensation to the applicant if he is  to be successful in his petition.  Well granted,  it is my view that the position of a director contrary to the applicants view, is salaried  with remuneration   or benefits  that can be  ascertained  with some  degree  of accuracy.  I do find as a matter of fact that damages  suffered can easily be computed  and compensation  given if  he is successful in his petition. In accordance  with the 2nd principle in Giella’s case it is therefore obvious that the application does not meet the threshold .  I am not persuaded  that the applicant’s views  the position as that service to the community.  Surely there are many non elective positions  in any  given community or society  which can provide avenues for the applicant  to offer charitable services  to his people.

I therefore  find no material placed before me that persuades me that damages  cannot be computed and  cannot adequately compensate the applicant  for the loss of  his seat.  In view  of failure by the application to meet the 1st and  2nd threshold  in Giella’s case I do not consider  it necessary to make any finding on the 3rd limb of balance  of convenience  since a court will only consider  the balance  of convenience   where there  is a doubt  as to whether  the first two principles  have been met.

The prayers  sought under  prayer 4 and 5 of the application are premature  at this stage  in the absence  of sound legal basis.   The  upshot  of the above is that the application dated 21st January,2015  lacks in merit.   It must fail.  I have no alternative but to dismiss it with costs.   It is so ordered.

R.K. LIMO

JUDGE

DATED, SIGNED AND DELIVERED AT KERUGOYA THIS 16TH DAY OF MARCH  2015in the presence of

M/S Thungu Counsel for the applicant

Ms Kiragu for 1st 2nd and  3rd Respondents and holding brief for Mr Abubakar counsel for  4th respondent

Willy Court clerk