REPUBLIC OF KENYA

IN THE CO-OPERATIVE TRIBUNAL

AT NAIROBI

TRIBUNAL CASE NO.314 OF 2020

PETER  NJAGI  NGOROI.........................................CLAIMANT

VERSUS

DAIMA  SACCO SOCIETY  LIMITED......1^ST  RESPONDENT

GIANT AUCTIONEERS................................2^ND RESPONDENT

RULING

Vide the Application  dated 23.9.2020,  the Claimant has moved  this Tribunal  seeking  for Orders inter alia:

1. That  this application  be certified  urgent  and heard  exparte  in the first  instance;

2. That  a temporary  injunction  be issued  against  the Respondents, their  agents, servants, employees, their officers  or anybody claiming  through  the Respondents from selling  by public  Auction  t he property  known as  GATURI/WERU/5169 on  25.9.2020 or at any  other time  thereafter and from  disposing  of, alienating, transferring  and or otherwise  howsoever interfering  with the Claimants  interest  in the said  property pending  the hearing  of  this  Application  inter-parties ; 

3. That  a temporary  injunction  be issued  against  the Respondents, their  agents, servants, employees, their officers  or anybody claiming  through  the Respondents from selling  by public  Auction  the property  known as  GATURI/WERU/5169 on  25.9.2020 or at any  other time  thereafter and from  disposing  of, alienating, transferring  and or otherwise  howsoever interfering  with the Claimants  interest  in the said  property pending  the hearing  of  this  suit ; 

4. That the costs of this Application  be  provided for.

The Application is supported by the grounds on its face and the  Supporting Affidavit  sworn by  himself on even  date and  the Supplementary  Affidavit  sworn  by himself again on 9.11.2020. The Respondent  has  opposed  the Application vide  the  Replying  Affidavit  sworn by Lucy  Marigu Murathi on 13.10.2020.

Vide  the  directions  given  on  14.10.2020,  the Application  was canvassed  by way of  written submissions.  The Claimant filed  his written submissions  on  16.11.2020 but the  Respondent did not  do so  despite  being  reminded  to do so.  

Claimant’s Contention

Vide the instant Application, the Claimant contend that he took a business loan with the 1^st Respondent in the year, 2016. That as security for the loan, he offered his land L.R.NO.GATURI/WERU/5169.

That  he used  the funds  to tender  for work which  had been given  by the County  Government  of Embu.  That  the said  government  did not pay  him for work  done until  now  thus he is  unable  to  service loan.

That  the Respondent  has applied  exorbitant interest  rates  to the facility. That  he has  for a period  of 1 ½ month  from  August, 2020- 19-9-2020 paid a total  of  Kshs.900,000/=.

Respondent’s Case

The Respondent  has opposed  the Application  on grounds  that the Application  is founded  on lies  and is brought  on bad faith.

That sometimes  in the year,  2016, the Claimant  approached  it  for a loan of  Kshs.2,500,000/=. That  the said  loan was  secured.  That  the Claimant  availed  title  No. LR. GATURI/WERU/5169 as security  for the loan.  That  upon valuation  of the said  property, the loan  was approved.  That  subsequently, the Claimant  defaulted  in repayment  of the said  loan.

That  upon  default,  several  statutory  Notices  were issued  but the  Claimant  did not  make  good  the loan  nor  even  communicate  to the  1^st Respondent.

That whilst  Covid- 19  has affected  business  the world  over,  the Claimant’s account  fell into  arrears  way before  Covid-19. That  as at  11.9.2019 the arrears  stood  at Kshs.2,911,291/=.

That  the 1^st Respondent  is not  privy to any business  dealing  between  the Claimant  and the Embu  County  Government as the loan Application form  shows that  the Claimant was  taking the  loan for his agro vet business.

That  having  defaulted  on repayment of the loan,  the Claimant  did not make  any effort  to follow up with the  1^st Respondent.

That whilst  surrendering his property as security for  the loan, the Claimant  knew  well about  the attendant  consequences  if the loan  was not  paid.

Issues  for determination

The Claimant’s  Application  dated  23.9.2020 has presented the following  issues  for determination:

a. Whether  the Claimant  has established  a proper basis  to warrant  the grant  of an Order  of a temporary  injunction.

b. Who should meet  the costs  of  the Application?

Temporary injunction

We have  jurisdiction  to make  an order  regarding  temporary  injunctions  by dint  of Order 40  of the Civil  Procedure  Rules. Order  40  Rule 1  (a) provides  thus:

       “ Where  in any suit  it is proved  by Affidavit or otherwise –

a. That  any property  in dispute  in a suit is  in  danger  of being  wasted,  damaged, or alienated  by any party to  the  suit, or wrongly sold in execution of a decree,  the court may  by order  grant  a temporary  injunction to  restrain  such  act, or  make such  other  order  for the purpose  of staying  and preventing  the wasting, damaging, alienation, sale,  removal, or disposition of the property  as the court thinks fit, until  the disposal  of the  suit  or until further  orders.

Before  exercising  the above  jurisdiction,  we are  guided  by  the Principles  enunciated  by the court in  the case of  Giella – versus-  Cassman  Brown [1973] EA. They  include:

a.  A prima facie case  with a probability  of success;

b. Irreparable  damage; and

c. Balance  of Convenience.

The court   in the  case of Mrao  Limited  versus  first  American Bank  of Kenya  Limited (2003) eKLR explained what  Constitute  a Prima Facie  case  in the following terms:

“.......A Prima Facie  case is  more than  an arguable  case. It is  not sufficient  to  raise  issues.  The evidence  must show  an infringement  of a right  and the probability  of  the Applicant’s case  upon trial.  It is a case which  on the material  presented,  to the  court,  a Tribunal  properly  directing  itself  will conclude  that there  exists  a right  which  has apparently been infringed  by the  opposite  party as to call  for an explanation from  the latter......”

Prima Facie  Case

Following  the foregoing  exposition  of the law,  a question  abound  as to whether  the Claimant  has established  a prima facie  case  with a probability  of success.

The Claimant’s borne  of contention  is that  he cannot repay  the loan  until  such  time that  the County  Government  of Embu  pays him  for the work  done.  That  repayment  of the loan  was tied  to him being  paid  by the County  Government  of Embu.

We have  perused  the business  loan Application  form  annexed  to the Replying  Affidavit  of the 1^st Respondent  and marked  as IMM-1. It  shows  the purpose of the Kshs.450,000/= loan to be school fees.

We have  also perused  the loan  Application  form signed  by the Claimant  on 27.7.2016, it shows  the purpose  of the Kshs.200,000/= loan  to be  “agrovet”.

We have  also perused  the loan application  form signed  by the Claimant  on 27.6.2016,  it shows  the purpose of  the loan  to be  construction.

We have  also perused  another  loan Application  loan  signed by  the Claimant  on 16.6.2016. It shows the purpose of the loan to be  for construction.

We have  also perused  all the annextures  provided  by the Claimant  as well as  the Respondent  and nowhere  have we found  a document  tying  and/or  hinging repayment  of the loan  to payment  of the Claimant by Embu  County Government.

We have  also  note  in the loan Application  forms  that the  Claimant offered  property LR. NO. GATURI/WERU/5169 as security for repayment  of the loan.

What  is apparent  also is that  the Claimant  does not  deny having  defaulted  in repayment  of the said  loan. What  he seems  to suggest  is that the  1^st Respondent  has  applied  exorbitant  interest  rates  thus ballooning  the outstanding  loan.  We hasten  to state that  a dispute  is not  a ground  for the grant  of a temporary injunction.

The totality  of the foregoing  is that  the Claimant  has come to  the court  of equity  when he  himself  has not done  equity  to the 1^st Respondent. The  monies  held by  the 1^st Respondent  do not belong  to it but  rather  to members by way  of contributions. Therefore  a party  cannot borrow  the said  money  default  in repayment  and subsequently  seek refuge  in  court when called  upon  to  repay. This  is what the  Claimant  has exactly done.  We  are not inclined  and/or  ready to  entertain  this kind  of conduct. Simply put,  we are saying  that the Claimant  has not  established  a prima facie  case  with a probability  of success.

Conclusion

The totality  of the foregoing is that  we do not  find merit  in the Claimant’s Application  dated  23.9.2020 and hereby  dismiss  it with costs to the  1^st Respondent.

RULING SIGNED, DATED AND DELIVERED VIRTUALLY THIS 25^TH DAY OF  MARCH,  2021

Hon. B. Kimemia          Chairperson                 Signed          25.3.2021

Hon. Jane Mwatsama    Deputy Chairperson   Signed          25.3.2021

Mr. P. Gichuki               Member                     Signed          25.3.2021

No appearance

Further mention  on  24.5.2021 for directions.

Hon. B. Kimemia   Chairperson   Signed  25.3.2021