Re: Corporate Insurance Company Limited (Petition of Captain Bulhan)
The bottom line
#Kenya's High Court struck out a winding-up petition used to pressure an insurer over a disputed claim, confirming that disputed insurance debts belong in civil courts.
What this practically means
#Executive summary
#Key legal issues
#Jurisdiction of the company court to restrain advertisement of a winding-up petition
The company court has jurisdiction to stop advertisement in appropriate cases, particularly where the petition is presented to put pressure on the company.
The court observed that a company court does not like to be used as a debt collection court, but where the debt is undisputed and unpaid, winding up may follow. Where a petition is presented to pressure the company over a disputed claim, an injunction restraining advertisement follows as trite law, per Re: A Company (1894).
Effect of a disputed insurance claim on a winding-up petition
The petitioner's insurance claim was disputed; liability had been repudiated and the claim investigated, so the validity of the claim could not be decided in the company court.
Letters from the company's Chief Executive showed the claim was investigated and liability repudiated. Counsel argued documents transferred title to the insurer, but the court found a dispute existed which only civil courts could resolve, not a winding-up forum.
Failure to exhaust contractual remedies
The petitioner had not utilized remedies under condition 10 of the insurance policy (the 'all differences clause'), so no cause of action had arisen and the petition was an abuse of process.
Relying on Kenindia Assurance Company Limited vs Patrick Muturi, the court held that where the policy contains an all-differences (arbitration) clause and the petitioner has not invoked it, no cause of action is ripe for court determination, rendering the petition an abuse of process warranting striking out.
Legal principles established
#- A company court will grant an injunction restraining advertisement of a petition presented to put pressure on a company
- A company court is not the forum for deciding the validity of a disputed debt; that is for the civil courts
- Failure to exhaust contractual remedies (the arbitration/all differences clause) means no cause of action has arisen and the petition is an abuse of process
Court orders
#- 1.The petition is struck out with costs
- 2.No decision made on the injunction application since the petition was struck out
- Jurisdiction invoked
- Company/winding-up jurisdiction of the High Court (Companies Act); company court jurisdiction to restrain advertisement of a winding-up petition
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Re: Corporate Insurance Company Limited (Petition of Captain Bulhan)", Case Analysis (1994). . Source:
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.