Keith Smith v Cic General Insurance Limited

3. 4. b. Judgment in the primary suit was entered on 16.03.2023 for the plaintiff against the defendant 's insured for Kshs.8,000,000/= plus costs and interest of the suit all totalling to Kshs.9,389,667.10/=as per the decree and certificate of costs dated 30.10.2023. c. The defendant was pursuant to the requirements of the Insurance (Motor Vehicles Third Party Risk) Act duly served with a statutory notice dated 27.03.2020 on 14.04.2020 before commencement of the primary suit. d. The primary suit related to liability and quantum of damages and gave rise to a statutory cause of action for a declaration under the Insurance (Motor Vehicle Third Party Risks) Act that the defendant is liable to satisfy the primary decree. e. The defendant was notified of the intention to file a declaratory suit, but failed to settle the decretal sum. f. The defendant is bound to satisfy the decree in the primary suit pursuant to section 10 of Cap 405. g. The amended defence is a sham, contains generalized denials, discloses no reasonable defence in law, and does not raise any bona fide triable issues, and the same is me calculated to delay the expeditious trial and determination of this suit. The same is an abuse of the court process. The Defendant/Respondent opposed the application vide a Replying Affidavit sworn on 5th June 2024 by Phylis Mutua. The Respondent contends that: a. The application is misconceived and otherwise bad in law because the defendant respondent's defence raises triable issues. b. The defendant was never informed of the intention to file a declaratory suit and that no Statutory Notice was served upon her prior to the commencement of the primary suit. c. The defendant was never informed of the road traffic accident the Plaintiff was involved in and did not participate in the primary suit because it was not informed that it was going on. d. The defendant is not obliged to pay the plaintiff/applicant for the judgment obtained in the primary suit. e. The supporting affidavit was sworn and attested in Cape Town. South Africa and no certificate of the Commissioner for Oaths is attached and, in any case, the same ought to have been attested by a qualified Notary Public. Parties canvassed the application through written submissions. The Applicant’s submissions are dated 15th October 2024 whilst those for the Respondent’s are dated 14th November 2024 which I have considered. Analysis and Determination 5. Having set out the respective parties’ positions as above and having established that although the Respondent had in its Replying Affidavit challenged the Supporting Affidavit of the applicant which was sworn in Cape Town South Africa for not attaching a certificate of the commissioner for oaths and for not having been attested by a qualified Notary Public, the Respondent did not submit on the issue. It was the Respondent’s submission on the issue that South Africa originally joined the Commonwealth in 1931 and upon becoming a Republic left the Commonwealth on 31st May 1961. On 1st June 1994, South Africa rejoined the Commonwealth as Republic, after the end of apartheid. https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/14709/eng@2025-02-03 2

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It therefore stands that the supporting affidavit by the Applicant herein which was sworn o 20th May 2024 was sworn and attested in South Africa is admissible in Kenyan courts. It is my belief that it is from the foregoing submission that the Respondent opted not to submit on the issue. I will therefore not delve into the issue which was correctly addressed in the Applicant’s submissions. 6. It is my most considered view that the issues for determination on the application are as follows:a) Whether the defence filed in this case should be struck out for raising no triable issues; b) Whether judgment should be entered in favour of the Plaintiff/Applicant against the Defendant as prayed in the Amended Plaint dated 22nd April 2024. c) Whether a declaration should be issued that the Defendant is bound to satisfy the decretal sum plus costs and interest in Machakos HCCC No. E002of 2021; Keith Smith vs. Lazarus Afwayi Maleche up to the statutory capping of Kshs.3,000,000.00 plus costs of the suit and interest at court rates. d) Who bears the cost of the application. 7. As regards the first issue on whether the defence filed in this case should be struck out for raising no triable issues, I aware that striking out of pleadings is an exercise of the court’s discretion and should be exercised sparingly and in very exceptional circumstances Wambua v Wathome [1968] E.A 40, Coast Projects Ltd v M.R. Shah Construction [2004] KLR 119. This is in alignment with the rules of natural justice which require that the court must not drive away any litigant however weak his or her case may be, from the seat of justice, . However, a balance must be had between this principle and the policy consideration that a Plaintiff should not be kept away from his judgment by an unscrupulous Defendant who files a defence which is a sham simply for the purpose of delaying the finalization of the case. 8. In the same vein, Order 2 Rule 15 of the Civil Procedure Rules, 2010 permits a party to apply for striking out of pleadings and provides as follows:“ 15. (1) 9. At any stage of the proceedings the court may order to be struck out or amended any pleading on the ground that— (a) It discloses no reasonable cause of action or defence in law; or (b) It is scandalous, frivolous or vexatious; or (c) It may prejudice, embarrass or delay the fair trial of the action; or (d) It is otherwise an abuse of the process of the court, and may order the suit to be stayed or dismissed or judgment to be entered accordingly, as the case may be.” Clearly it cannot be gainsaid that striking out of pleadings is a drastic remedy that should only be resorted to where a pleading is a complete sham. Therefore, in this case, the court has to be satisfied that the defence is a complete sham and raises no bona fide triable issue worth a trial by the court. https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/14709/eng@2025-02-03 3

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10. Applying the above test, the basis upon which the Plaintiff seeks to strike out the defence is on the ground that the Defendant was pursuant to the requirements of the Insurance (Motor Vehicles Third Party Risk) Act duly served with a Statutory Notice dated 27.03.2020 on 14.04.2020 before commencement of the primary suit. That the primary suit related to liability and quantum of damages and gave rise to a statutory cause of action for a declaration under the Insurance (Motor Vehicle Third Party Risks) Act that the defendant is liable to satisfy the primary decree. The defendant was notified of the intention to file a declaratory suit, but failed to settle the decretal sum. The defendant is bound to satisfy the decree in the primary suit pursuant to Section 10 of Cap 405. That the amended defence is a sham, contains generalized denials, discloses no reasonable defence in law, and does not raise any bona fide triable issues, and the same is me calculated to delay the expeditious trial and determination of this suit. The same is an abuse of the court process. Therefore, the defendant is precluded from denying that it was never served with the Statutory Notice or that it did not know of the existence of the primary suit. 11. On the other hand, the Defendant contends that it was never served with the Statutory Notice and was not aware of the primary suit. The Defendant submits that its amended statement of defence raises triable issues which ought to be deliberated on in depth and determined at a hearing for the court to arrive at a just decision. 12. I have perused the amended Statement of defence dated 9th May 2024 and I establish the following: 13. i. At paragraph 3, the Defendant denies being the insurer of motor vehicle registration number KBB 990M/ZC 6702 Mercedes Benz. ii. At paragraph 4, the Defendant denies that it issued a Policy of Insurance No. P.NO 012/080/1/051938/200016/07 to any person either in respect of motor vehicle registration number KBB 990M/ZC 6702 Mercedes Benz. Or any other vehicle. iii. At paragraph 6 the Defendant deny the occurrence of the alleged accident on 8th July 2019 as pleaded. iv. At paragraph 7, the Defendant states that the proceedings in the primary suit did not comply with Section 10 of the Insurance (Motor Vehicles Third Party Risks) Act Cap 405 (“the Act”) Laws of Kenya and all other enabling Acts of Parliament. v. At paragraph 8, the Defendant states that if it is liable to satisfy the decree in the primary suit, then it is not liable to satisfy the decree in excess of Kshs.3,000,000/= pursuant to the provisions of Section 5(b) (iv) of the Act. vi. At paragraph 9, the Defendant denies that it was served with any notice of institution of the primary suit pursuant to the provisions of Section 10(2) of the Act. It also denies service of Summons upon the Defendant in the primary suit. vii. At paragraph 10, the Defendant denies that the Plaintiff is entitled to the declaration that it is bound to satisfy the decree in the primary suit up to Kshs.3,000,000/= plus costs and interest. viii. Lastly at paragraph 11, the Defendant denies it was ever issued with any demand notice in respect of the present suit. I have considered the Parties’ pleadings and the submissions. The Plaintiff has in the application and submissions addressed each of the matters denied by Defendant in the amended Statement of defence. The Plaintiff maintains that the Defendant was served with the notice of intention to file suit in the primary suit as well as the present suit as provided for under Section 10 (2) of the Act. That the https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/14709/eng@2025-02-03 4

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Defendant was served with a Statutory Notice dated 27/03/2020 on 27/03/2020 via email and again on 14/04/2020 via registered post before commencement of the primary suit. 14. The Defendant alleges that the Statutory Notice that was posted never reached it because the certificate of posting shows that it was sent to a company called “The General Insurance Limited” which is not the Defendant herein. 15. The Defendant also stated that its offices are not far from the Plaintiff's offices and hence there is no valid reason why the Statutory Notice could not have been served physically. However, the Plaintiff explained that the Statutory Notice was done at the height of the COVID-19 pandemic and therefore the Defendant's offices were inaccessible due to the attendant restrictions on physical movements. The Plaintiff argue that "the Act" does not restrict potential Plaintiffs to serving the Insurer of the offending motor vehicle only by physical means as alluded to in the Defendant's replying affidavit. 16. The Plaintiff also maintain that the Defendant's address on the letter as well as on the envelope was complete as indicated in the email printouts and on the face of the Statutory Notice itself and the post office may have shortened the Defendant's name when printing out their standard receipt since all details could not have fitted on the receipt. Curiously, the Defendant neither denies the postal address appearing on the face of the Statutory Notice nor the email address indicated therein. Additionally, upon service of the Statutory Notice, the registered letter was never returned by the post office as unclaimed and the email forwarding the same statutory notice to the Defendant never confirmed failure of delivery. 17. From the foregoing, this court observes that the Defendant has not denied that their offices were inaccessible for physical attendances during COVID-19 pandemic as stated by the Plaintiff. They have also not denied that either the email addresses or the postal address used by the Plaintiff do not belong to it. The Defendant has not attempted to share or disclose their purported correct or actual emails or postal addresses at the stated time. This court is therefore convinced that the Defendant herein was properly served with the Statutory Notice in the primary suit and demand and notice to sue in the instant suit. 18. The Defendant also alleged lack of service of the Summons upon the Defendant in the Primary suit as its reason for not participating in the primary suit. The Plaintiff states that after service of the Statutory Notice and a copy of the demand letter, the Defendant engaged the Plaintiff s advocates on a “without prejudice” basis to quantify the Plaintiff's claim, which was aptly done. Due to the “without prejudice” caveat appearing on the said communications, the same cannot be produced in court. However, it is evident that the Defendant was aware of the primary suit and was also made aware of the present suit before its commencement upon being served with a demand letter dated 11.11.2023 on 14.11.2023, which was stamped by the defendant in acknowledgment of receipt. On this issue, this court finds that the Defendant in the primary suit must have been served with Summons as was considered by the trial court based on the affidavit of service sworn on 31.03.2021 that was presented before court. I have also established that the Defendant in the primary suit did not attempt to set aside the judgment for nonservice of Summons to enter appearance and again, I am convinced the Summons to enter appearance in the primary suit were served upon the Defendant therein. 19. The Defendant also denies having insured motor vehicle registration number KBB 990M / ZC 6702 Mercedes Benz under policy insurance number P. No.012/080/1/051938/2016/07. However, the police abstract dated 26.07.2019 shows otherwise. The Plaintiff urged this court to be guided by the holding in Esther Muthoni Munyiri vs Amaco Insurance Company Ltd (2021) eKLR where the police abstract was produced in support of the Appellant's claim and the court held that it was upon the Defendant to disprove that the Plaintiff did not hold a valid policy of insurance with it. I am so guided https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/14709/eng@2025-02-03 5

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by the cited decision and also on the holding in Judith Anyango v Invesco Assurance Limited [2021] eKLR where the court agreed entirely with APA Insurance Co. Ltd vs. George Masele [2014] eKLR (Mabeya J) that: “ a police abstract was good enough, as evidence that there had been a policy of insurance in force, and that it was unreasonable to expect the injured victim to produce a certificate of insurance, given that he was not privy to the contract between the insured and the insurer, and that the details, as captured in the police abstract, are from the certificate of insurance affixed to a motor vehicle or supplied by the insured. The trial court need not have looked further than from the police abstract. The appellant had established on a balance, from the police abstract, that there was a valid insurance policy in force, and the burden shifted to the respondent to prove otherwise. See also Martin Onyango vs. Invesco Assurance Company Limited [2015] eKLR (Majanja J). 20. I therefore find that the Defendant insured motor vehicle registration number KBB 990M / ZC 6702 Mercedes Benz under policy insurance number P. No.012/080/1/051938/2016/07 and hence it is bound to satisfy the decree in the primary suit pursuant to Section 10 of Cap 405 which provides that: “ (1) 21. Section 10 of "the Act" was discussed in Madison Insurance Company Limited v Augustine Kamanda Gitau [2020] eKLR as follows:“ 28. 22. If. after a policy of insurance has been effected. judgment in respect of any such liability as is required to be covered by a policy under paragraph (b) of section 5 (being a liability covered by the terms of the policy) is obtained against any person insured by the policy, then notwithstanding that the insurer may be entitled to avoid or cancel, or may have avoided or cancelled, the policy, the insurer shall, subject to the provisions of this section, pay to the persons entitled to the benefit of the judgment any sum payable thereunder in respect of the liability, including any amount payable in respect of costs and any sum payable in respect of interest on that sum by virtue of any enactment relating to interest on judgments. The side note to that section is “Duty of insurer to satisfy judgments against persons insured".....From the side note it is clear that the section deals with the obligation by the insurer to satisfy judgments obtained against persons insured. What clearly comes out from the said provision is clear that for an insurance company to be under a statutory obligation to satisfy a decree certain condition precedent must be satisfied. Firstly, before a judgment is obtained, there must have been a policy of insurance in effect. Secondly, the judgment must have been in respect o fa liability required to be covered by a policy under paragraph (b) of section 5 (being a liability covered by the terms of the policy). Thirdly, the judgment must have been obtained against a person insured by the policy." The Defendant states that if it is liable to satisfy the decree in the primary suit, then it is not liable to satisfy the decree in excess of Kshs.3,000,000/= pursuant to the provisions of Section 5(b) (iv) of the Act and this leads me to the determination as to whether a declaration should be made that the Defendant it is bound to satisfy the decree in the primary suit up to Kshs.3,000,000/= plus https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/14709/eng@2025-02-03 6

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costs and interest. Judgment in the primary suit was entered on 16.03.2023 in favour of the Plaintiff against the defendant's insured for Kshs.8,000,000/= plus costs and interest of the suit totalling to Kshs.9,389,667.10/= as per the dated 30.10.2023. 23. Section 5 of "the Act” provides the requirements in respect of insurance policies as follows: “ In order to comply with the requirements of Section 4, the policy of insurance must be a policy which(a) is issued by a company which is required under the Insurance Act (Cap. 487) to carry on motor vehicle insurance business; and (b) insures such person, persons or classes of persons as may be specified in the policy in respect of any liability which may be incurred by him or them in respect of the death of, or bodily injury to, any person caused by or arising out of the use of the vehicle on a road: Provided that a policy in terms of this section shall not be required to cover(i) liability in respect of the death arising out of and in the course of his employment of a person in the employment of a person insured by the policy or of bodily injury sustained by such, a person arising out of and in the course of his employment; or (ii) except in the case of a vehicle in which passengers are carried for hire or reward or by reason of or in pursuance of a contract of employment, liability in respect of the death of or bodily injury to persons being carried in or upon or entering or getting on to or alighting from the vehicle at the time of the occurrence of the event out of which the claims arose; or (iii) any contractual liability; (iv) liability of any sum in excess of three million shillings, arising out of a claim by one person." 24. Clearly, from the above provision of Section 5 (b) (iv), the Defendant is bound to satisfy the decretal sum plus costs and interest of the primary suit up to the statutory capping of Kshs.3,000,000/=. 25. Now turning to the issue as to whether or not to strike out the Amended statement of defence herein, in the case of The Co-Operative Merchant Bank Ltd. vs. George Fredrick Wekesa Civil Appeal No. 54 of 1999 which was cited with authority by the Court of Appeal in Uchumi Supermarkets Limited & another v Sidhi Investments Limited [2019] eKLR, the Court stated as follows: “ The power of the Court to strike out a pleading under Order 6 rule 13(1) (b) (c) and (d) is discretionary and an appellate Court will not interfere with the exercise of the power unless it is clear that there was either an error on principle or that the trial Judge was plainly wrong.....Striking out a pleading is a draconian act, which may only be resorted to, in plain cases...Whether or not a case is plain is a matter of fact....A Court may only strike out pleadings where they disclose no semblance of a cause of action or defence and are incurable by amendment.” https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/14709/eng@2025-02-03 7

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26. In the case of Juliet Waringa Wanyòndu (Deceased) v Lion of Kenya Insurance Company [2017] eKLR it was held: “ ...Given the facts of this case therefore and the provisions of the law set out above, I believe that the defence by the defendant in this case raises no triable issue. It would be to delay the day of reckoning and deny the applicant the fruit of his judgment to allow the matter to proceed to hearing where there is clearly no triable issue". 27. 28. Applying the principles in the decisions cited above to the present circumstances and the application before this court, it is my finding that the Amended statement of defence dated 9th May 2024, raises no triable issue that ought to be subjected to a full trial for hearing and determination on merits. The conclusion I come to, is that the application dated 21st May 2024 is merited and I make the following orders: a. The Amended Statement of Defence dated 9th May 2024 is struck out. b. Judgment is hereby entered in favour of the Plaintiff/Applicant against the Defendant/ Respondent as prayed in the Amended Plaint dated 22nd April 2024. c. That consequently, a declaration is hereby issued that the Defendant/Respondent is bound to satisfy the decretal sum plus costs and interest in Machakos HCCC No. E002 of 2021; Keith Smith vs. Lazarus Afwayi Maleche up to the statutory capping of Kshs.3,000,000.00. d. Costs of the application dated 21st May 2024 are awarded to the Plaintiff/Applicant. It is hereby so ordered. RULING WRITTEN, DATED & SIGNED AT MACHAKOS THIS 3RD FEBUARY 2025. NOEL I. ADAGI JUDGE https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/14709/eng@2025-02-03 8

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