James Mwangi Kariuki v Nanasi Housing Co-operative Society Limited
The bottom line
#Kenya's Court of Appeal confirmed that non-members can sue co-operative societies in ordinary courts, not just the Co-operative Tribunal.
What this practically means
#Executive summary
#Key legal issues
#Whether the appellant, a second purchaser who was not a member of the co-operative society, could sue in the subordinate court notwithstanding section 76(1) of the Co-operative Societies Act
The Court of Appeal held that the appellant was not a member of the society in accordance with its By-laws, and the dispute between a non-member and the society was not within the exclusive jurisdiction of the Tribunal; the subordinate court had jurisdiction.
The appellant was a second buyer who purchased the plot from Evans Mburu Muthemba, who had bought it from the original member and shareholder John King'oo Mutunga. The appellant paid transfer fees and monies for amenities but, as the High Court itself found, never paid the entrance fees or for one share as the By-laws required. In the absence of such payment, the society's contention that he was treated as a full member could not stand. Section 76(1) applies to disputes among members, persons claiming through members, or between members and the society; a non-member claiming in his own right falls outside that scheme, so the subordinate court's finding of jurisdiction was correct and the High Court erred.
Whether the question of compliance with the society's By-laws in the transfer of the plot could be determined on the strike-out application
The court held that whether the transfer of the plot complied with the society's By-laws was an issue of fact that could only be resolved at the trial, not on the jurisdictional application.
The application before the subordinate court raised only the question of jurisdiction, not whether the transfer of the plot complied with the By-laws; the latter was raised in the defence. As an issue of fact, it could only have been resolved at the trial. The court therefore confined its determination to jurisdiction and did not disturb the pending suit.
Legal principles established
#- A dispute between a non-member and a co-operative society does not fall within the exclusive jurisdiction of the Co-operative Tribunal under section 76(1) of the Co-operative Societies Act and may be entertained by the ordinary courts.
Court orders
#- 1.The appeal is allowed
- 2.The judgment of the High Court is set aside
- 3.The ruling of the subordinate court is restored
- 4.The respondent to pay the costs of the appeal to the appellant
- On appeal from
- High Court of Kenya at Nairobi
- H.C.C.A. No. 42 of 2012
- Jurisdiction invoked
- Appellate jurisdiction of the Court of Appeal over appeals from the High Court (Constitution of Kenya, Article 164; Co-operative Societies Act, section 76 in issue below)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "James Mwangi Kariuki v Nanasi Housing Co-operative Society Limited", Case Analysis (2015). Civil Appeal No. 333 of 2012. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2015/91/eng@2015-12-18
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.