High Court 16291 of 2025

MANAL MEDICAL CENTRE LIMITED ....................................... 9TH APPLICANT BALANGA MEDICAL CENTRE LIMITED ................................. 10TH APPLICANT MANDERA DRUG MART MEDICAL CLINIC LTD ................. 11TH APPLICANT ARCHPRIME MEDICAL CLINIC OYUGIS ................................ 12TH APPLICANT SANAAG MEDICAL CENTRE LIMITED .................................... 13TH APPLICANT NELEPEK MEDICAL CARE CENTRE ........................................ 14TH APPLICANT RHAMU DIMTU MEDICAL CENTRE ....................................... 15TH APPLICANT JAMBO JIPYA MEDICAL CENTRE ............................................. 16TH APPLICANT NEW MANYALO NURSING HOME ........................................... 17TH APPLICANT QUEENTERIC ANNEXE HOSPITAL .......................................... 18TH APPLICANT NISSI MEDICAL CENTRE LIMITED .......................................... 19TH APPLICANT RULING 1. The nineteen (19) Applicants by Chamber Summons dated 8th October, 2025 seek leave of this Court to apply for judicial review orders of certiorari and prohibition to challenge the decisions of the respondent, Social Health Authority (SHA), a public authority established under the Social Health Insurance Act (SHI Act) which were made vide administrative letters issued on diverse dates between 23rd July 2025 and 8th September, 2025 and which letters were later given effect through publication in the Kenya Gazette Notices Nos. 10944 of 7th August 2025 and 12003 of 26th August, 2025, suspending the contracts which the respondent had entered into with the applicants for provision of medical services to SHA patients. The suspension was for a period of ninety (90) days effective upon receipt of the said letters. 2. The chamber summons is supported by the statutory statement and verifying affidavit sworn by Abdirahm Mohamed Khalif, a director of the 4th applicant on behalf of all the other applicants, annexing the many documents which include the impugned letters and gazette notices as well as the contracts entered into between the respondent and each of the applicants for provision of medical services to SHA patients. 3. According to the applicants, the letters given effect by the suspension of the contracts were issued and given effect without due process, that they were never given an opportunity to be heard and were therefore condemned unheard contrary to the principle of audi alterum patem. The claim that the suspension of the contracts was unreasonable, made without prior written notice to the applicants’ service providers violated their right to fair administrative action as stipulated in Article 47 of the Constitution and the Fair Administrative Action Act and that the decisions were ultra vires and therefore amenable for quashing. 4. Despite service of the application upon the respondent, it never entered any appearance or attended court for the hearing of the application which would ordinarily have been considered exparte in chambers as stipulated in Order 53 of the Civil Procedure Rules, but this Court elected to accord the respondents an opportunity to be heard before making a decision as to whether to grant leave to apply or not. https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16291/eng@2025-11-12 2

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5. Nevertheless, the absence of opposition does not automatically entitle the Applicant to the orders sought. The Court must still satisfy itself that a prima facie arguable case has been disclosed before leave can issue. 6. It is also worth noting that the applicant could as well have invoked the provisions of the Fair Administrative Rules, 2024 and approached this Court by way of Originating Moton in which case, there would be no need for leave to apply. 7. That said, the applicants having elected to apply for leave as mandated by section 9 of the Law Reform Act and Order 53 of the Civil Procedure Rules, this Court will proceed to determine whether the leave sought is merited as the choice of under what procedural law to initiate these proceedings does not invalidate these proceedings. 8. In other words, the grant of leave to apply is not automatic. The applicant who files an application for leave to apply has the burden of establishing an arguable prima facie case for consideration at the substantive stage. They must demonstrate that their intended motion is not frivolous, vexatious, time barred or hopeless. They must also act with promptness in challenging the administrative decision. 9. In Republic v County Council of Kwale & Another; Ex parte Kondo & 57 Others (Mombasa HCMC No. 384 of 1996), the Court emphasized that the leave requirement in Order 53 of the Civil Procedure Rules is designed to eliminate at an early stage any applications for judicial review which are either frivolous, vexatious or hopeless and to ensure that the applicant is only allowed to proceed to substantive hearing if the Court is satisfied that there is a case fit for further investigation at a full inter partes hearing of the substantive application. 10. The question I pose and answer in this case is, does the application meet the test for grant of leave to apply as pronounced in the above cited case of Republic v County Council of Kwale & Another; Ex parte Kondo & 57 Others, among other cases? 11. The bench mark for the grant of leave was also pronounced by the Court of Appeal in Mirugi Kariuki v Attorney General Civil Appeal No. 70 of 1991 [1990-1994] EA 156; [1992] KLR 8 as follows: “ It is wrong in law for the Court to attempt an assessment of the sufficiency of an applicant’s interests without regard to the matter of his complaint. If he fails to show, when he applies for leave, a prima facie case, on reasonable grounds for believing that there has been a failure of public duty, the Court would be in error if it granted leave. The curb represented by the need for the applicant to show, when he seeks leave to apply, that he has a case, is an essential protection against abuse of the legal process. It enables the Court to prevent abuse by busybodies, cranks and other mischief-makers… In this appeal, the issue is whether the appellant in his application for leave to apply for orders of certiorari and mandamus demonstrated to the High Court a prima facie case for the grant of those orders. Clearly, once breach of the rules of natural justice was alleged, the exercise of discretion by the Attorney General under section 11(1) of the Act was brought into question. Without a rebuttal to these allegations, the appellant certainly disclosed a prima facie case. For that, he should have been granted leave to apply for the orders sought.” https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16291/eng@2025-11-12 3

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12. In Uwe Meixner & another v Attorney General [2005] KECA 292 (KLR) Media Neutral Citation [2005] KECA 292 (KLR) the Court of Appeal cited the case of Njuguna v Ministry of Agriculture [2001] 1 E.A. 184, where at page 186 paragraph g, the same Court was stated: “… leave should be granted, if on the material available the court considers without going into the matter in depth that there is an arguable case for granting leave”. 13. At the leave stage, the Court is warned to refrain from making any conclusive findings. A prima facie arguable case is not necessarily one that must succeed. The Court must remain alive to the fact that the Respondent who has not appeared at this preliminary stage may later place before the Court evidence or legal argument that could displace the arguability of the Applicant’s claim. 14. Applying the principles espoused in the above cases, this Court takes note that the respondent’s suspension of the SHA contracts held by the applicants was for a period of three months from the date of issuance of the letters which were issued on diverse dates between 23rd July 2025 and 8th of August, 2025, and that period has since lapsed, such that even if this court was to grant leave to apply and even stay the enforcement of the said directives which were subsequently gazette as a formality, the impugned decisions have been spent and fully implemented. 15. Therefore, would this court grant leave to apply for judicial review orders which are spent and therefore rendered moot? What practical purpose would be served by proceeding with matters which are moot? 16. The Supreme Court, quite recently, in the case of Dande & 3 others v Inspector General, National Police Service & 5 others (Petition 6 (E007), 4 (E005) & 8 (E010) of 2022 (Consolidated)) [2023] KESC 40 (KLR) (16 June 2023) (Judgment) Neutral citation: [2023] KESC 40 (KLR) stated as follows concerning the doctrine of mootness: “ The doctrine of mootness required that controversy must exist throughout judicial proceedings including at the appellate level. An appeal or an issue was moot when a decision would not have the effect of resolving a live controversy affecting or potentially affecting the rights of parties. Such a live controversy must be present not only when the action or proceeding was commenced but also when the court was called upon to reach a decision. The doctrine of mootness was therefore based on the notion that judicial resources ought to be utilized efficiently and should not be dedicated to an abstract proposition of law and that courts should avoid deciding on matters that were abstract, academic, or hypothetical.” 17. In Daniel Kaminja & 3 others (suing as Westland Environment Caretaker Group) vs County Government of Nairobi [2019] eKLR, Mativo J (as he then was) stated that a matter is moot if further legal proceedings with regard to it can have no effect, or events have placed it beyond the reach of the law. 18. The doctrine of mootness serves to prevent courts from engaging in abstract or academic determinations. 19. While certiorari may, in limited circumstances, issue to quash a decision that continues to affect the Applicant’s record or reputation, no evidence has been placed before the Court to show that the expired suspension continues to have any operative or legal effect. Consequently, both certiorari and prohibition would serve no practical purpose in the present case. https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16291/eng@2025-11-12 4

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20. In terms of the Gazette Notices issued to inform the public of the impugned suspension, this court further observes that the Gazette Notice of 8th August 2025 is now spent as ninety days lapsed on 8th November, 2025 while the 2nd Gazette Notice dated 26th August 2025 lapses on 26th November 2025. 21. The Applicants moved this Court under certificate of urgency on 9th October 2025. However, they have not offered any satisfactory explanation for the delay in approaching the Court, given that the impugned directives were issued in writing in July and August 2025. It bears emphasis that the mere filing of a document titled certificate of urgency does not, of itself, render a matter urgent. Urgency must be demonstrated through clear, compelling, and time-sensitive circumstances that justify the Court’s immediate intervention. 22. In the present case, the application was filed long after the impugned decisions had taken effect, and indeed, the suspension complained of was for a fixed period of ninety (90) days, which period has since lapsed. The orders sought have therefore been overtaken by events. It is for that reason that this Court cannot issue orders in vain, for judicial review remedies are discretionary and will not be granted where the impugned action is spent or incapable of practical enforcement. 23. With respect to the second Gazette Notice issued on 26th August, 2025, it is noted that only fourteen (14) days remain before the expiry of the said gazette Notice, informing the public of the suspension of the contracts. Even if this Court were to grant leave to commence judicial review proceedings, such leave would serve no practical purpose because, by the time the substantive motion is filed, heard and determined, the gazette notice in all likelihood, have lapsed. The matter would therefore be rendered academic and moot. 24. On the prayer for stay, having found that the Gazette Notices in question and the respective suspension periods have already lapsed, the Court would ordinarily have no further reason to consider the matter. However, for completeness, and to guide parties in future applications, the Court deems it appropriate to make a few observations on the principles that should inform applications for stay of implementation of impugned administrative decisions. 25. Under Order 53 Rule 1(4) of the Civil Procedure Rules, the grant of leave may, if the Court so directs, operate as a stay of the proceedings or decision in question. The exercise of this discretion depends on whether the decision is still capable of being stayed or whether it has been fully implemented and or taken effect and therefore not a continuing decision. 26. An order that leave do operate as a stay under Order 53 Rule 1(4) of the Civil Procedure Rules is a discretionary remedy, to be granted only where the Court is satisfied that the impugned decision is still capable of being implemented or enforced, and that its continued operation would render the substantive motion nugatory. The Court must also be satisfied that the applicant has approached the Court timeously, and that the stay, if granted, will not occasion undue prejudice to the public interest or to the functions of a lawful authority. 27. Thus, a party seeking stay must demonstrate three key elements: 28. i. That the decision sought to be stayed is still subsisting and capable of implementation; ii. That failure to stay the decision would cause irreversible prejudice to the applicant; and iii. That the application has been made without unreasonable delay. These principles exist to ensure that the Court’s intervention serves a practical and equitable purpose, and not to issue orders that are merely declaratory or academic in nature. https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16291/eng@2025-11-12 5

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29. In the present case, the record shows that the impugned decisions were taken in July and August 2025 and gazetted in August 2025 and that the Applicants only approached this Court in October, 2025, more than two months later. 30. In view of the foregoing analysis, and considering that the impugned Gazette Notices have already taken effect and the suspension periods have since lapsed or are on the verge of expiry, this Court finds no basis upon which to grant an order of stay. To do so would be to issue orders in vain against actions that have already been fully implemented. Consequently, the prayer that leave do operate as a stay is hereby declined. 31. There is yet another aspect of this matter that militates against the Applicants’ case. During the hearing of the application, when learned counsel for the Applicants appeared before the Court, an inquiry was made as to whether the contract under which the Applicants were suspended contained any internal dispute resolution mechanism. In response, counsel informed the Court that there was no such mechanism provided for in the said contract. 32. I have combed through the contracts which the applicants signed with the respondent, and which the applicants lament that the respondent unilaterally suspended without adequate notice and without according them an opportunity to be heard before implementing its directives to suspend the contracts. 33. Clause 37 of the said Contracts provides for dispute resolution as follows: “ 37. Dispute Resolution 37.1. A dispute resolution Tribunal is established under the SHI Act Part VIII to address any decision made under the SHI Act which appeal should be made within 30 days from the date of the decision. 37.2 … 37.3 … 37.4. is on good faith and negotiations 37.5. The parties irrevocably submit to the exclusive jurisdiction of the Dispute Resolution Tribunal as established under the SHI Act and attendant Regulations for the determination of disputes arising under this Contract. Notwithstanding the foregoing, a party is entitled to seek preliminary injunctive relief for interim or conservatory measures from any court of competent jurisdiction pending the final decision or award of the Dispute Resolution Tribunal.” 38. This Court considers it necessary to emphasize that, as a general principle, parties are required to exhaust all internal dispute resolution mechanisms before invoking the jurisdiction of this Court in judicial review proceedings. This principle, now firmly anchored in Section 9(2) and (3) of the Fair Administrative Action Act, 2015, is intended to promote administrative accountability, efficiency and the orderly resolution of disputes at the institutional level before recourse to the courts. 39. Courts have consistently held that judicial review is a remedy of last resort, to be invoked only where internal remedies are either unavailable, ineffective, or demonstrably inadequate. In Speaker of the National Assembly v Karume [1992] KLR 21, the Court of Appeal stated that where there is a clear procedure for redress of a grievance prescribed by law, that procedure should be strictly followed. Similarly, in Republic v National Environment Management Authority Ex parte Sound Equipment https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16291/eng@2025-11-12 6

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Ltd [2011] eKLR, the Court observed that parties who bypass established statutory or contractual mechanisms, act prematurely in invoking the Court’s supervisory jurisdiction. 40. Accordingly, where a party has access to a contractual or institutional mechanism for resolving disputes, that mechanism ought to be pursued first. Only where such remedy is unavailable or ineffective should this Court be approached. 41. In light of the contractual provisions in the suspended contracts, the pertinent question that arises is whether the Applicants invoked the jurisdiction of the Dispute Resolution Tribunal established under section 44 of the SHI Act, to address the grievances arising from the Respondent’s letters communicating the decision to suspend their contracts. 42. Closely related to that inquiry is whether the filing of these proceedings was merely intended to obtain interim or conservatory relief as contemplated in Clause 37 of the Contracts in issue, pending the determination of the dispute by the said Tribunal. 43. Parties are bound by the terms of the contracts into which they have freely and voluntarily entered and the Court cannot re-write or ignore such provisions merely because one party finds them inconvenient. In addition, the resort to alternative dispute resolution mechanisms that are available and effective is both a constitutional and statutory imperative, as underscored in Article 159(2)(c) of the Constitution and implemented through Section 9 of the Fair Administrative Action Act, 2015. These provisions enjoin parties to pursue and exhaust internal or agreed mechanisms for dispute resolution before seeking the intervention of the Court. 44. The contractual provisions cited above clearly acknowledge that while the parties are obliged to submit to the jurisdiction of the Dispute Resolution Tribunal for the resolution of any dispute arising between or among them, they nonetheless retain the liberty to approach the Court for preliminary injunctive, interim, or conservatory relief where circumstances so demand. However, the proper and lawful first port of call remains the Tribunal, not the Court. The Court’s intervention is intended to be ancillary and supportive, not substitutive, of the agreed dispute resolution process. 45. I reiterate that the doctrine of exhaustion of internal remedies is a well-established principle in administrative law, requiring parties to first utilize available internal mechanisms before approaching external tribunals or courts. 46. In this case, it is clear that there is an established internal alternative dispute resolution mechanism for resolution of any dispute between the applicants and the respondent SHA. The applicants have not alleged that that mechanism is inefficient or that it is inoperational. They have not stated why they never first filed the dispute before the Tribunal and only come to court for the preliminary injunctive, interim or conservatory orders as stipulated in Clause 37 of the contract, pending the final determination of the dispute by the Tribunal. 47. In Ndiara Enterprises Ltd v Nairobi City County Government [2018] KECA 825 (KLR) the Court of Appeal held as follows in upholding the decision of this court on exhaustion of remedies: “ Cognizant of the clear procedure for redress provided under the Act, the learned Judge refused to admit jurisdiction in determining the application on the basis that where a clear and specific procedure for redress of a grievance is provided, then that procedure should be strictly followed. The Judge cited the cases of the speaker of The National Assembly v Njenga Karume (2008) 1 KLR 425, Mutanga Tea & Coffee Company Ltd v Shikara Ltd & Anor (2015) eKLR for that proposition. https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16291/eng@2025-11-12 7

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The appellant also alleged that the respondent’s refusal or failure to demolish the illegal structures or to approve its plan for a perimeter wall infringed on its constitutional right to fair administrative action. It invoked sections 4, 7, 8, 9 and 11 of the FAA as the basis for which it sought the order of mandamus. However, the Judge noted that the High Court was expressly prohibited by section 9 (2) of the Act from reviewing “an administrative action or decision under the Act unless the mechanisms for appeal or review and all remedies available under any other written law are first exhausted. “The Act however gives the High Court power to exempt a person from the obligation to exhaust any remedy if the court considers such exception to be in the interest of justice. Faced with that scenario, the learned Judge delivered herself as follows; “In addition, under Section 9(2) of the Fair Administrative Action Act No. 4 of 2015, (1) the High Court or a subordinate court under Subsection (1) is expressly prohibited from and “shall not” review an administrative action or decision under this Act unless the mechanisms including internal mechanisms for appeal or review and all remedies available under any other written law are first exhausted. (3) The High Court or a subordinate court shall, if it is not satisfied that the remedies referred to in subsection (2) have been exhausted, direct that applicant shall first exhaust such remedy before instituting proceedings under suction (1) (4) Notwithstanding Subsection (3) the High Court or subordinate court may, in exceptional circumstances and on application by the applicant, exempt such person from the obligation to exhaust any remedy if the court considers such exception to be in the interest of justice … 64. From the above provisions of the law and decided cases, it is clear that even the Fair Administrative Action Act which the exparte applicant in this case claims has been violated mandates an applicant to show that they have exhausted the alternative remedies available under any other written law or avenue before resorting to court by way of judicial review. However, the onus is on the applicant to demonstrate to the court that there exist exceptional circumstances to warrant his or her exemption from resorting to the available remedies; and on application for such exemption. 65. In this case, no doubt, the applicant had an avenue for ventilating its grievances where the respondent refuses to approve the building plans. There is no evidence that the applicant lodged any such complaint or appeal to the Liaison Committee, the National Liaison Committee and or to the High Court. The Physical Planning Act provides elaborate mechanisms for resolution of disputes relating to approval of development plans and therefore no party is permitted to bypass those mechanisms and jump into a judicial review Court to obtain orders which are discretionary.” https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16291/eng@2025-11-12 8

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We see no reason to warrant interference with those findings as in our view they are based on sound law and evidence. The record does not reflect any attempt by the appellant to first resolve its grievances against the respondent under the procedure provided for redress under PPA or FAA. There is no evidence that the appellant made any complaints in the nature of the respondent’s refusal to approve its plans for construction of a perimeter wall to the liaison committee under section 13 of the PPA. It’s clear that the appellant could only approach the High Court on appeal against the decision of the National Liaison Committee. Though the High Court can exempt a party from following such clear laid procedures for redress of grievances before approaching it in the noble interests of justice, the learned Judge rightly found that the appellant had failed to prove there were exceptional circumstances in its case to warrant such exemption. Indeed, there are no apparent exceptional circumstances to justify such exception and which exception was also not sought. The High Court’s power to exercise its jurisdiction under Article 165 of the Constitution was therefore limited or restricted by statute in this instance as found by the Judge. The appellant had complained before this Court that the learned Judge erred in failing to appreciate that though there exists an alternative procedure for redress, the same was less convenient, beneficial and effective in its circumstances. However, that argument must be taken as an afterthought. The same was never raised or pursued before the High Court thus denying the respondent the opportunity for rebuttal and denying this Court the benefit of the reasoning of the High Court on the same issue. 48. In suspending the applicants’ contracts to provide services to the patients, the respondent cited breach of the contractual term and invoked Clause GCC 16 alleging that the applicants submitted claims for unperformed services which, under Clause GCC 16 amounts to corrupt and fraudulent practices specifically, among others, upcoding and unbundling; creating suspected and fictitious claims to the Authority; intentionally using higher paying code on the claim for the beneficiary to fraudulently reflect the use of a more expensive procedure, device or medicine that was actually used or was necessary, altering or falsifying information with intent to defraud. 49. The respondent therefore took the decision to immediately suspend the applicants from providing the medical services to SHA beneficiaries and transacting with SHA for ninety (90) days pending completion of investigations. It also directed the applicants to transfer the SHA beneficiaries to the next available SHA contracted facility, coordinating with the nearest SHA branch. 50. Nothing stopped the applicants from filing the dispute before the Dispute Resolution Tribunal and come to court to seek for preliminary injunctive/ interim or conservatory orders even before the gazettement of the decisions made in the letters issued to the applicants communicating the decision to suspend them from offering healthcare services to SHA patients. 51. The period that the applicants took, from July to October 9th 2025 before filing these proceedings would have been utilized before the Tribunal while seeking only interim or conservatory relief from the Courts. 52. There is absolutely no evidence that the applicants attempted to have the dispute filed for resolution before the Dispute Resolution Tribunal. 53. Section 44 of the SHI Act establishes the Dispute Resolution Tribunal. Under section 43 of the said Act: https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16291/eng@2025-11-12 9

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43 54. (1) A person aggrieved by a decision made under this Act may, within one month from the date of the decision, appeal to the Dispute Resolution Tribunal for a review of such decision. (2) The Tribunal may uphold, reverse, revoke or vary The Decision of the Board appealed under subsection (1). (3) A person who is not satisfied with an order made by the Tribunal under subsection (2) may appeal to the High Court within twenty-one days from the date the order is made. On the other hand, Part III of the Regulations made under the Act provides for the Filing and Response to Complaints as follows: 9. Filing of disputes (1) A dispute to the Tribunal, arising from a decision made under the Act, shall be commenced by filing a complaint with the Tribunal within thirty days from the date of the making of the decision complained of, if the dispute relates to— (a) registration of members; (b) empanelment of healthcare providers and health facilities; (c) contracting; (d) preauthorization; (e) settlement of claims; (f) service provider payments and refunds; and (g) any other decision made under the Act. (2) Despite subrule (1), an omission or failure to perform any act under the Act may be lodged as a complaint. 55. There are operational Regulations for the Tribunal as promulgated by Parliament, being The Social Health Insurance (Tribunal Procedure) Rules, vide Legal Notice 48 of 2024. 56. Finally, it is important to note that the SHI Act provides for an elaborate procedure for challenging the decisions made under the Act, at section 43 of the Act. First, the applicant has to initiate a complaint before the Dispute Resolution Tribunal which has the power to review and set aside the decision of the respondent. Second, where the complainant is not satisfied by the decision of the Tribunal, the applicant has recourse to the High Court by way of an appeal. The applicants by passed all that path, without first seeking this Court’s permission as stipulated in section 9(4) of the Fair Administrative Action Act, to apply for exemption of exhaustion of the alternative dispute resolution mechanisms provided for in the SHI Act. 57. In the circumstances, I find and hold that besides the claim herein being substantially moot, the applicants failed to exhaust the available dispute resolution mechanisms and procedure for challenging decisions made by the respondent under the SHI Act before coming to court for the judicial review remedies. I decline to grant leave sought in the chamber summons dated 8th October 2025. The application is dismissed with no orders as to costs, the respondent having failed to participate in these proceedings. This file is closed. https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16291/eng@2025-11-12 10

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DATED, SIGNED AND DELIVERED AT NAIROBI THIS 12TH DAY OF NOVEMBER, 2025 R.E. ABURILI JUDGE https://new.kenyalaw.org/akn/ke/judgment/kehc/2025/16291/eng@2025-11-12 11

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