Oserian Sacco Society Limited v Fredrick Nyolo [2020] eKLR Case Summary

Court
Co-operative Tribunal at Nairobi
Category
Civil
Judge(s)
Hon. B. Kimemia (Chairman), Hon. F. Terer (Deputy Chairman), P. Gichuki (Member)
Judgment Date
April 30, 2020
Country
Kenya
Document Type
PDF
Number of Pages
3
Explore the Oserian Sacco Society Limited v Fredrick Nyolo [2020] eKLR case summary, highlighting key legal insights and implications for future cases.

Case Brief: Oserian Sacco Society Limited v Fredrick Nyolo [2020] eKLR

1. Case Information:
- Name of the Case: Oserian Sacco Society Limited v. Fredrick Nyolo
- Case Number: Tribunal Case No. 449 of 2019
- Court: Co-operative Tribunal at Nairobi
- Date Delivered: April 30, 2020
- Category of Law: Civil
- Judge(s): Hon. B. Kimemia (Chairman), Hon. F. Terer (Deputy Chairman), P. Gichuki (Member)
- Country: Kenya

2. Questions Presented:
- Whether the Respondent’s statement of response should be struck out and summary judgment entered against him for Ksh. 4,706,326.00.
- Who should bear the costs of the application?

3. Facts of the Case:
- The Claimant, Oserian Sacco Society Limited, filed an application on October 3, 2019, seeking to strike out the Respondent’s statement of response and to obtain a summary judgment for a claimed amount of Ksh. 4,706,326.00.
- The Respondent, Fredrick Nyolo, opposed this application by filing a replying affidavit on November 14, 2019, claiming he had participated in the surcharge proceedings and had a counterclaim against the Claimant for shares amounting to Ksh. 3,227,960.00.
- The proceedings stemmed from a surcharge order issued by the Commissioner for Co-operative Development on January 23, 2019. The Respondent did not appeal this order, which the Claimant argued implied acceptance of the surcharge amount.

4. Procedural History:
- The application was canvassed through written submissions, with the Claimant submitting on March 13, 2020, and the Respondent also submitting on the same day.
- The Tribunal directed that the application be determined based on these submissions, focusing on the legal grounds for striking out the Respondent's defense and the Claimant’s entitlement to summary judgment.

5. Analysis:
- Rules: The court considered the Co-operative Societies Act, particularly Sections 73, 74, and 75, which govern the powers of the Commissioner to surcharge officers of co-operative societies and the appeal process against such surcharges.
- Case Law: The Tribunal referenced the case of *Mek Sacco Society Ltd v. Samson Omundi Chilu & 6 others [2019] eKLR*, which clarified the procedures surrounding surcharge orders and appeals. The ruling emphasized that failure to appeal within the stipulated time frame results in the surcharge amount becoming a civil debt recoverable summarily.
- Application: The Tribunal found that the Respondent's defense failed to disclose a reasonable legal defense as it attempted to re-open the surcharge proceedings, which the Tribunal lacked jurisdiction to do. The Claimant satisfied the conditions for summary judgment under Section 75 of the Act.

6. Conclusion:
- The Tribunal ruled in favor of the Claimant, striking out the Respondent’s statement of response and entering summary judgment against him for Ksh. 4,706,326.00, plus interest and costs at court rates. This decision affirmed the enforceability of surcharge orders and clarified the limitations on appealing such orders.

7. Dissent:
- There were no dissenting opinions recorded in this case.

8. Summary:
- The Co-operative Tribunal ruled in favor of Oserian Sacco Society Limited, granting summary judgment against Fredrick Nyolo for Ksh. 4,706,326.00. The ruling underscored the importance of adhering to statutory procedures regarding surcharge orders and reinforced the principle that failure to appeal such orders within the designated timeframe results in those orders becoming enforceable civil debts. This case serves as a significant precedent in the enforcement of financial accountability within co-operative societies in Kenya.

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