Recently, the High Court delivered its judgment in the case of Republic v. The Director of Public Prosecutions and 4 Others Ex Parte Shamilla Kiptoo and 2 Others HCMA 510 of 2015 (Consolidated) in which the court granted the orders of certiorari and prohibition sought by the Applicants namely Maurice Okoth, Music Copyright Society of Kenya (MCSK) former Chief Executive Officer (CEO), James Maweu Mutisya, former MCSK Board Director, Lillian Njoki Thuo, MCSK Management Accountant, Peter Kisala Enyenze, MCSK Regional Manager and Shamilla Kiptoo, Nasratech Limited Managing Director (and Okoth’s wife).
The order of Certiorari granted by the court quashes the decision, declaration and directive of the Director of Public Prosecutions (DPP), Directorate of Criminal Investigations (CID), Inspector General of Police (IG), Chief Magistrate’s Court and the Attorney General (collectively referred to as the Respondents) to prefer criminal charges against the Applicants based on the facts contained in the Charge Sheet dated 18th November 2015 in Criminal Case No. 1904 of 2015 – Republic v. Dan Maurice Mwande Okoth & 6 others. The order of Prohibition granted by the court directed to the Respondents prohibits the prosecution of the Applicants based on the facts contained in the Charge Sheet dated 18th November 2015 in Criminal Case No. 1904 of 2015 – Republic versus Dan Maurice Mwande Okoth & 6 others. Finally, the court ordered the costs of the application to be borne by the DPP, CID and IG.
On 2nd September 2015 Okoth received Summons to compel his attendance issued by the DPP requiring that he appears on 5th October 2015 before the Officer in charge Investigations at CID Headquarters for an inquiry into an alleged offence of misappropriation of the Society’s funds and stealing by Director Contrary to section 282 of the Penal Code. At the same, the CID moved to the Chief Magistrate’s Court in Miscellaneous Criminal Application Number 1828 of 2015 and obtained warrants authorizing it to collect MCSK’s bank statements for purposes of their investigations. The DPP claimed to be relying on a complaint filed by a Cosmas Anyuka Mas Mbaga, David Luvumbaze, Daniel Madaga Mamboleo and Sarah Oundo Nagaya who are all MCSK members who had lodged a Petition with the Attorney General on the same allegations but this Petition was allegedly never considered.
On 29th September 2015, the CID through the Director of Criminal Investigations requested MCSK to furnish it with several items including, the list of registered members, lists used to declare royalty payments, list of royalty payment transactions between members and the collecting society as from 2013, to which MCSK complied. Thereafter on 5th October 2015 Okoth appeared before the Officer in Charge of Investigations at the CID Headquarters together with his Advocate.
On 8th October 2015 Okoth was arrested together with Thuo and Enyenze for alleged offences of stealing by Servant contrary to section 281 of the Penal Code and were taken to the CID Headquarters and then to Muthaiga Police Station and were released on a Police Cash bond of Kshs. 20,000.00 with instructions to attend the Chief Magistrate’s Court Milimani the next day for arraignment on which day they appeared at Milimani Courts as directed but the Charge Documents against the said MCSK employees were never filed. The police bonds were consequently extended to 24th November 2015 when Okoth and his 2 colleagues and Mutisya were arraigned on various charges in Criminal Case No. 1904 of 2015 listed below:
a) Count 1: All the accused persons were charged for Conspiracy to Commit a Felony Contrary to Section 317 of the Penal Code i.e. that on diverse dates with intent to defraud MCSK the accused persons conspired to defraud MCSK a sum of Kshs. 27,000,000.00.
b) Count 2: Okoth was charged with stealing by an officer of a company, contrary to section 282 of the Penal Code i.e. that on 18th October 2014 at ABC Bank Okoth stole Kshs. 25,000,000.00 being the property of MCSK which came to his possession by virtue of his employment.
c) Count 3: Mutisya was charged with stealing by a Director, contrary to section 282 of the Penal Code i.e. that on 30th April 2015 he stole Kshs. 6,000,000.00 being the property of MCSK.
d) Count 4: The Directors of Nasratech Limited (including Okoth’s wife who is the Managing Director) were charged with stealing Kshs. 27,000,000.00 the property of MCSK.
On 21st October 2015, an order was granted in Miscellaneous Criminal Application Number 2138 of 2015 freezing MCSK’s bank accounts at the instigation of CID who stated that they had suspicion to believe that the Directors and Management of MCSK were withdrawing huge sums of money from MCSK’s accounts.
With regard to Count 2, it was alleged that the said funds in the amount of Kshs. 25,000,000.00 were deposited in a fixed deposit account at African Banking Corporation with a view to generate interest based on the authorisation of the MCSK CEO from the Board. With regard to Count 3, it was alleged that the sum of Kshs. 6,000,000.00 was withdrawn by the management staff to pay members attendance fees for an AGM held at Embu on 1st May 2015 as per the Board’s Resolution dated 16th April 2015 pursuant to the proposal of the Finance, Investments and Distribution Committee dated 13th April 2015. As per the Resolution each member who attended the meeting was to be paid Kshs. 3,000.00. With regard to Count 4, it was alleged that all payments made to members including Nasratech Limited were duly sanctioned by the board of MCSK as per the lawful mandate and powers of the directors and officers of the company contained in its memorandum and articles of association.
In arriving at its decision to prohibit, quash the criminal proceedings against the Applicants, the court notes in part as follows:
“The entity which is alleged to have been defrauded, according to the charge sheet, has not only not complained but is also an applicant in these proceedings seeking or supporting the case seeking the termination of the criminal proceedings. It is therefore clear that the person or entity who the prosecution purports to protect through the criminal proceedings, does not support the prosecution’s action. In my view it would seem that the decision to charge the applicants was arrived at without proper investigations and therefore contrary to Article 157(11) of the Constitution as read with section 4 of the Office of the Director of Public Prosecution Act. According to me the said decision defeats reason.”
The court goes further to state as follows:
“In my view the decision to charge the Applicants with offences allegedly committed against the Society in light of the material placed before me does not add up. Apart from that it is clear that the interested parties’ bone of contention revolves around accounts. To transform a dispute which is purely a matter of accounting into a criminal one when the perceived victim has not lodged a complaint and when the complainants themselves are not even sure of what is due to them in my view amounts to embarking on a fishing expedition and amounts to employment of criminal process for the achievement of collateral purposes.”
In other words, the court finds that the members of MCSK aided by the CID and DPP commenced criminal proceedings in order to settle what is purely a civil dispute. Therefore, the court concludes that it would be a misuse or abuse of the judicial process to permit such criminal proceedings to proceed, particularly where the facts as can be discerned from the complainants do not support the charges preferred against the applicants.
This blogger is not surprised by the court’s decision which appears to be sound in law. However at the heart of this matter is a growing call from the membership of MCSK for transparency and accountability within their collective management organisation (CMO). Although going the criminal litigation route was ill-advised from the start, it is clear that there is a growing push from most CMO members for higher standards of good corporate governance at their respective CMOs.