Skip to content
AI-generated case briefs sourced from Kenya Law · Not legal advice
Caselaw
AI-generated case brief
Case Brief · caselaw.co.ke
High CourtPartially Allowed· [2020] KEHC 9572 (KLR)

Allan Njoroge Gaturu v New Milimani Sacco Limited

High Court of Kenya
5 May 2020
MKMary Kasango
1,607 words in judgment
View original judgment Watch case
AI-assisted case brief
·~6 min to read original · ~4 min brief

The bottom line

#

If your Sacco employee steals your loan payments, the Sacco itself is legally responsible for repaying you.

What this practically means

#

Executive summary

#
The plaintiff, a member of the defendant Sacco since 2011, obtained a Ksh. 12,000,000 loan on 26th March 2015 repayable monthly through the Sacco's field officer, Judy Muriithi. Payments were recorded in a passbook without PDQ receipts on the ground that the machine was faulty. When the passbook filled up, the field officer took it in October 2015 and never returned it. Inquiries revealed the loan was said to be in arrears and that the field officer had not remitted the payments; the Sacco threatened to list the plaintiff with the Credit Reference Bureau and realise the security, a plot share certificate. The defendant filed no defence; the parties consented to trial on affidavits and submissions. The court framed a single issue: whether the plaintiff made payment to the field officer. Finding the evidence uncontroverted, and corroborated by the Sacco's own police report of stealing by servant against the field officer, the court held the Sacco vicariously liable, applying Chesire v HZ Company Limited and the vicarious liability principles in Muwonge v Attorney General of Uganda. The plaintiff's indebtedness was fixed at Ksh. 31,600, and after deducting that from the Ksh. 536,858.21 held in credit in his account, judgment was entered for Ksh. 505,258.21 with interest at court rates. Injunctions were granted restraining sale of the security and CRB listing, and the defendant was ordered to release the share certificate within 30 days. The plaintiff was awarded costs. The claim for general damages was not granted.

Key legal issues

#
01

Whether the plaintiff made loan payments to the defendant's field officer

Holding

The plaintiff proved on the uncontroverted evidence that he made payments to the field officer, who failed to remit them; the defendant is vicariously liable.

Reasoning

The plaintiff's evidence and that of his employee who made the daily payments was uncontroverted, the defendant having filed no defence. The defendant's own police report of stealing by servant against the field officer corroborated that she collected members' money, including the plaintiff's, and did not remit it. As her employer, the defendant is liable for her acts within the course of employment, and the onus of disproving collection fell on the defendant, which it failed to discharge.

p. 2
02

Vicarious liability of the Sacco for its field officer's misappropriation

Holding

The defendant is liable for the acts of its employee Judy Muriithi committed within the scope of her employment.

Reasoning

Relying on Chesire & Another v HZ Company Limited, which quotes Muwonge v Attorney General of Uganda, Limpus v London General Omnibus Company and A & W Hemphill Ltd v Williams, the court held that a master remains liable whether the servant's acts are negligent, deliberate, wanton or criminal, the test being whether the acts were done in the course of employment. The field officer was on duty collecting loan repayments.

p. 2

Legal principles established

#
  • A master is liable for the acts of his servant committed within the course of his employment, whether negligent, deliberate, wanton or criminal.

Court orders

#
  1. 1.An order of injunction restraining the defendant, its servants or agents, from in any way dealing with or selling or advertising for sale the plaintiff's interest held in the Share Certificate of Plot No. 233B within LR 7340/69 Embakasi
  2. 2.The defendant shall within 30 days from the date of the judgment deliver to the plaintiff the Share Certificate of Plot No. 233B within LR 7340/69 Embakasi
  3. 3.An injunction restraining the defendant from submitting the plaintiff's name to the Credit Bureau in respect of the loan issued on 26th March 2015
  4. 4.Judgment entered for the plaintiff against the defendant for Ksh. 505,258.21 with interest at court rate from the date of filing the suit until payment in full
  5. 5.The plaintiff awarded the costs of the suit

Authorities

#

Legislation

  • Co-operative Societies ActCap. 490

Cases cited (4)

  • CHESIRE & ANOTHER V HZ company limited
    (1982) eKLR

    Vicarious liability of a master for acts of a servant within the course of employment

  • Muwonge v Attorney General of Uganda
    [1967] EA 17

    Master liable for servant's acts whether negligent, deliberate, wanton or criminal

  • Limpus v London General Omnibus Company
    [1862] 1 H & C 526

    Principles of vicarious liability enunciated therein

  • A & W Hemphill Ltd v Williams
    [1966] 2 Lloyd's List Reports, Vol 2, 101

    Salmond on Torts extract: master exempt only when servant exclusively on his own business

Jurisdiction invoked
Original civil jurisdiction of the High Court; dispute concerning a co-operative society registered under the Co-operative Societies Act (Cap. 490)

Key timeline

#

Practical implications

#

Frequently asked questions

#

Cite this brief

#

Cite this brief

Caselaw, "Allan Njoroge Gaturu v New Milimani Sacco Limited", Case Analysis (2020). . Source:

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.