Ainabkoi Investment Co-operative Society Limited v Ainabkoi Farmers Savings & Credit Co-op Society Limited & another [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
July 23, 2020
Country
Kenya
Document Type
PDF
Number of Pages
3
Explore the case summary of Ainabkoi Investment Co-operative Society Limited v Ainabkoi Farmers Savings & Credit Co-op Society Limited & another [2020] eKLR, highlighting key legal findings and implications for co-operative societies.

Case Brief: Ainabkoi Investment Co-operative Society Limited v Ainabkoi Farmers Savings & Credit Co-op Society Limited & another [2020] eKLR

1. Case Information:
- Name of the Case: Ainabkoi Investment Co-Operative Society Limited v. Ainabkoi Farmers Savings & Credit Co-Operative Society Limited & County Government of Uasin Gishu
- Case Number: Tribunal Case No. 596 of 2019
- Court: Co-operative Tribunal at Nairobi
- Date Delivered: July 23, 2020
- Category of Law: Civil
- Judge(s): Hon. B. Kimemia (Chairman), Hon. F. Terer (Deputy Chairman), P. Gichuki (Member)
- Country: Kenya

2. Questions Presented:
The court must resolve the following central legal issues:
- Whether the Claimant has established a proper basis for the grant of a temporary injunction against the 1st Respondent.
- Who should bear the costs of the Application.

3. Facts of the Case:
The Claimant, Ainabkoi Investment Co-Operative Society Limited, alleges that the 1st Respondent, Ainabkoi Farmers Savings & Credit Co-Operative Society Limited, breached a Memorandum of Understanding (MOU) dated May 26, 2015, by offering for sale the Claimant’s shares and unlawfully taking control of the management of certain properties, including Silver Hotel and Mushroom Hostel. The Claimant seeks an injunction to prevent the 1st Respondent from selling these properties pending resolution of the dispute.

The 1st Respondent counters that the Claimant has not fulfilled its obligations under the MOU, specifically failing to pay a required sum of Kshs. 39,871,174, which was a condition precedent for the transfer of assets. This non-payment, according to the 1st Respondent, means the Claimant has no claim to the properties.

4. Procedural History:
The Claimant filed an Application on May 21, 2020, seeking an injunction against the 1st Respondent. The 1st Respondent opposed this Application through a statement of grounds and a replying affidavit. The Tribunal provided directions for written submissions, which were filed by both parties on June 16, 2020, and June 29, 2020, respectively. The Tribunal then considered these submissions in determining the Application.

5. Analysis:
- Rules: The court relied on established principles for granting a temporary injunction as set out in *Giella v. Cassman Brown & Co. Ltd* [1973] E.A. 358, which requires the applicant to demonstrate:
1. A prima facie case with a probability of success.
2. Irreparable harm if the injunction is not granted.
3. The balance of convenience favors granting the injunction.

- Case Law: The court referenced *Robert Mugo Wa Karanja v. Ecobank (Kenya) Ltd & Another* [2019] eKLR and *Nguruman Limited v. Jan Bonde Nelson & 2 Others* [2014] eKLR to outline the requirements for a prima facie case and the conditions under which an injunction may be granted.

- Application: The court found that the Claimant had not established a prima facie case. The Claimant's failure to pay the requisite amount under the MOU meant it could not demonstrate a right that had been infringed upon by the 1st Respondent. Consequently, the Claimant's request for an injunction was deemed unmeritorious as it had not fulfilled its obligations under the agreement.

6. Conclusion:
The Tribunal dismissed the Claimant’s Application for a temporary injunction, concluding that the Claimant had not met the necessary legal requirements for such relief. The court found that the Claimant had not approached equity with clean hands, as it had not complied with the terms of the MOU.

7. Dissent:
There were no dissenting opinions noted in the ruling.

8. Summary:
The Tribunal ruled against Ainabkoi Investment Co-Operative Society Limited, denying its request for a temporary injunction to prevent Ainabkoi Farmers Savings & Credit Co-Operative Society Limited from selling certain properties. This case underscores the necessity for parties to adhere to contractual obligations to seek equitable relief, highlighting the principle that one must come to equity with clean hands. The ruling also emphasizes the importance of complying with conditions precedent in contractual agreements.

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