Metropolitan Cannon General Insurance & another v Hura (Civil Appeal E023 of 2025) [2025] KEHC 18670 (KLR) (16 December 2025) (Judgment)

Key Facts

Issues

• The primary issue was whether an insurer is liable to pay for material damages under the Insurance (Motor Vehicles Third Party Risks) Act, Cap. 405, or only for personal injuries. The appellants argued that sections 5(b) and 10 of the Act limit liability to personal injuries, while the respondent relied on case law affirming liability for material damage claims. The court dismissed the appeal, confirming that the Act mandates coverage for third-party material damages unless expressly excluded.
• A secondary issue concerned compliance with Section 10(2) of the Act, which requires insurers to receive notice of proceedings within 14 days of filing. The court emphasized that the four-fold test for liability under Section 10 must be met, including valid notice issuance. The respondent demonstrated that the notice requirement was satisfied, supporting the judgment in their favor.

Holdings

• The appeal is dismissed as it lacks merit, with costs awarded to the respondent. The court determined that the insurer is liable under the Insurance (Motor Vehicles Third Party Risks) Act, Cap. 405, and that the loss is covered by the policy unless expressly excluded.
• The court awarded costs of Ksh. 85,000 to the respondent, adhering to the principle that costs follow the event. The discretion in awarding costs was exercised judiciously, favoring the successful party.

Remedies

• The appeal is dismissed with costs of Ksh. 85,000.
• 30 days stay of execution is granted.
• 14 days right of appeal is granted.
• The file is closed as per the judge's order.

Monetary Damages

Legal Principles

• The judgment reaffirmed that costs generally follow the event in legal proceedings, but this is a discretionary rule exercised judiciously by the court. The court dismissed the appeal and awarded costs to the respondent (Ksh 85,000), citing precedents from the Supreme Court and Court of Appeal regarding the exercise of judicial discretion in costs awards.
• The court applied the purposive approach to interpret the Insurance (Motor Vehicles Third Party Risks) Act, emphasizing its objective to ensure third parties injured in accidents are compensated. This approach considers the statutory framework and the legislative intent to address known issues, as highlighted by references to Sir Clement De Lestang and Lord Denning.

Precedent Name

• Peters vs Sunday Post Limited
• Jasbir Singh Rai & 3 others v. Tarlochan Singh Rai & 4 others
• David Kinyanjui & 2 others v Meshack Omari Monyori
• Stephen Kiarie Chege v Insurance Regulatory Authority & Another
• Farah Awad Gullet v CMC Motors Group Limited
• Direct Line Assurance Company Ltd vs Mwangi

Cited Statute

Judge Name

Passage Text

• They relied on the case of David Kinyanjui & 2 others v Meshack Omari Monyori [1998] eKLR. It was their case that only High Court decisions were relied upon. They sought to quash the said decision.
• The import of the above provision of the law is that for liability to accrue under Section 10 of the Insurance (Motor Vehicle Third Party Risks) Act Cap 405, there is a 4-fold test to be met. Firstly, that the motor vehicle in question was insured by the Appellant; Secondly, that the Respondent has a judgment in his favour against the insured; Thirdly, that statutory notice was issued to the insurer within 30 days of filing the suit where judgment has been obtained and finally, the Respondent was a person covered by the insurance policy.
• It is our finding that the position in law is that costs are at the discretion of the court seized up of the matter with the usual caveat being that such discretion should be exercised judiciously meaning without caprice or whim and on sound reasoning secondly that a court can only withhold costs either partially or wholly from a successful party for good cause to be shown.