Disputes in co-operative sector will now be handled by the Co-operative Court which will stand on its own aside from the existing Co-operative Tribunal, if the draft bill will be enacted into law.
The Draft Co-operative Bill, 2021 which if enacted into law will repeal the long-term Co-operative Societies Act which was enacted in December 22, 1997; will see the establishment of a Co-operative Court which shall be presided over by a Magistrate of the rank of a Senior Principal Magistrate and above.
The kind of disputes which shall be referred to the Court include any dispute concerning the business of a cooperative arising among members, past members and persons claiming through members, past members and deceased members; or between members, past members or deceased members, and the board of directors of the cooperative, or any officer of the cooperative.
It will also deal with disputes between the cooperative and any other co-operative, a cooperative and an employer, between a liquidator and past members, creditors or other third parties; between a cooperative and any other third party entities that are not a co-operative concerning the co-operative business.
The disputes here shall include claims by members, past members and persons claiming through members, past members and deceased members arising from breach or violation of contractual obligations; claims for any debt or refunds or deposits or any other due.
A claim by a co-operative against an employer for non-remitted deductions arising from an agreement between the co-operative and the employer on remittance of deductions; and a claim by a co-operative against a member, past members and persons claiming through members, past members and deceased members in respect to a breach or violation of contractual obligations.
To a large extend, some of these disputes are currently being handled by the Co-operative Tribunal, which was the only organ mandated to settle disputes in the co-operative sector.
This therefore implies that the Tribunal, which if the bill will be enacted into law; will deal with different line of disputes different from what is currently dealing with.
According to the bill, the disputes which will be referred to the Tribunal shall include any dispute concerning the business, including but not limited to the management, governance, activities or operations of a co-operative arises between the Commissioner and a co-operative, Commissioner and an officer of a co-operative.
Director of County Co-operative and a co-operative, Director of County Co-operative and an officer of a co-operative, authority and a Co-operative, authority and an officer of a co-operative shall be referred to the tribunal.
This dispute shall include a rejection of an application for registration of a co-operative, a cancellation of registration of a co-operative; or a claim in respect of a surcharge imposed against any person, a claim by a Sacco Society against a refusal to grant or a revocation of license or any other matter with the Authority.
Others include a claim by the Commissioner or County Director for Co-operatives or the Authority or liquidator against a co-operative or an officer of a co-operative in respect of any surcharges, fines, or financial penalty imposed under this Act or any other written law; any claim by a co-operative against the Authority in respect of any administrative action commenced or instituted or imposed by the Authority pursuant to the Sacco Societies Act or any other written law; and any claim by a co-operative or an officer of a co-operative in respect of any administrative action commenced or instituted or imposed by the Commissioner or the Directors of County Co-operatives under this Act.
The bill requires that the appointment of the Court magistrates be done by the Judicial Service Commission (JSC) through a notice in the Gazette who will serve as co-operatives court magistrates or where the person appointed is a serving magistrate, designate by notice in the Gazette the person a Co-operatives court magistrate.
In the event the JSC designates a serving magistrate to serve as a co-operatives court magistrate, the person shall serve as a co-operative courts magistrate, in addition to any other judicial duties assigned to the person; though the Chief Justice shall ensure that there are not less than ten sitting co-operative magistrates’ courts at any given time.
The bill further requires the Chief Justice to establish co-operatives court registries, within the existing court stations in the country; provided that there shall be at least 15 co-operative court registries in the country at any given time taking into account the geographical distribution of the counties.
A co-operatives court will hold its sittings in place where the cooperative court registry has been established, however, the Chief Justice may consolidate cases registered in one co-operative registry to be heard and determined in another registry taking into account the geographical locations and proximities of the registries; and further direct a co-operative court magistrate or more to sit in one or more places where the co-operative court registry is established guided by the principles of efficiency, ease of access and effective delivery of judicial services
The bill also states that the Cooperatives Court shall sit on such days as shall be designated by the Deputy Registrar of the court taking into account the number of cases filed in or pending before in each registry.
Despite the Co-operative societies falling under the county government in the Kenya’s 2010 constitution, the bill wanted to involve the national government in governing of the organisation due to its role in the country’s economy, specifically by setting out the respective functions of the National government and those of the county governments.
By Roy Hezron
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