Smith v CIC General Insurance Limited (Civil Suit E021 of 2023) [2025] KEHC 14695 (KLR) (3 February 2025) (Ruling)

Key Facts

Transaction Type

Issues

• Whether the Amended Statement of Defence dated 9th May 2024 should be struck out as a sham pleading that discloses no reasonable defence in law and is calculated to delay the trial
• Whether a declaration should be issued that the Defendant 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 plus costs of the suit and interest at court rates
• Whether the costs of the application dated 21st May 2024 should be awarded to the Plaintiff/Applicant
• Whether judgment should be entered in favour of the Plaintiff against the Defendant as prayed in the Amended Plaint dated 22nd April 2024 for the decretal sum of Kshs.8,000,000 plus costs and interest

Holdings

• The court found that the Amended Statement of Defence dated 9th May 2024 raises no triable issue and is a sham calculated to delay the trial. The defence contains generalized denials and does not raise any bona fide triable issues, constituting an abuse of the court process. This determination was based on the Defendant's failure to provide evidence of its correct contact details and the court's reliance on police abstracts and prior case law (e.g., Esther Muthoni Munyiri vs Amaco Insurance Company Ltd [2021] eKLR) to establish the validity of the insurance policy and service of notice.
• Judgment was entered in favour of the Plaintiff/Applicant against the Defendant/Respondent as prayed in the Amended Plaint dated 22nd April 2024. The court determined that the Defendant is bound to satisfy the decree in the primary suit (Machakos HCCC No. E002 of 2021) due to its statutory obligations under the Insurance (Motor Vehicles Third Party Risks) Act, particularly Section 10 of Cap 405, which mandates insurers to pay judgments against insured parties up to the statutory cap of Kshs.3,000,000.00.
• A declaration was issued that the Defendant is bound to satisfy the decretal sum plus costs and interest in the primary suit (Machakos HCCC No. E002 of 2021) up to the statutory capping of Kshs.3,000,000.00. The court emphasized that Section 5(b)(iv) of the Insurance Act limits liability to three million shillings per claimant, and the Defendant's denial of liability was rejected as unsubstantiated.
• The costs of the application dated 21st May 2024 were awarded to the Plaintiff/Applicant. This followed the court's conclusion that the application was merited and the Defendant's opposition lacked sufficient grounds to justify its defence.

Remedies

• Costs of the application dated 21st May 2024 are awarded to the Plaintiff/Applicant.
• The Amended Statement of Defence dated 9th May 2024 is struck out.
• Judgment is hereby entered in favour of the Plaintiff/Applicant against the Defendant/Respondent as prayed in the Amended Plaint dated 22nd April 2024.
• 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.

Monetary Damages

Legal Principles

• The court emphasized the principle of natural justice, stating that it must not drive away any litigant from the seat of justice regardless of the weakness of their case. However, this principle must balance against preventing unscrupulous defendants from delaying judgments through sham defenses.
• The ruling relied on the rule of law to enforce strict compliance with procedural rules (Order 2 Rule 15) and statutory obligations under the Insurance (Motor Vehicles Third Party Risk) Act, particularly Section 10 regarding insurers' duty to satisfy judgments.
• The court applied the principle of substance over form by scrutinizing the defense's content rather than its formal structure, concluding it was a sham designed to delay proceedings rather than raise genuine issues.

Precedent Name

• Coast Projects Ltd v M.R. Shah Construction
• Esther Muthoni Munyiri vs Amaco Insurance Company Ltd
• Martin Onyango vs. Invesco Assurance Company Limited
• Juliet Waringa Wanyondu (Deceased) v Lion of Kenya Insurance Company
• The Co-Operative Merchant Bank Ltd. vs. George Fredrick Wekesa
• Wambua v Wathome
• Madison Insurance Company Limited v Augustine Kamanda Gitau
• Judith Anyango v Invesco Assurance Limited

Key Disputed Contract Clauses

• Section 5(b)(iv) of the same Act limits an insurer's liability to Kshs.3,000,000 for claims by a single person arising from motor vehicle third-party risks, excluding certain exceptions.
• Section 10 of the Insurance (Motor Vehicles Third Party Risks) Act (Cap 405) mandates insurers to pay judgments obtained against insured parties for liabilities covered by the policy, subject to statutory caps and conditions.

Cited Statute

• Insurance (Motor Vehicles Third Party Risk) Act
• Civil Procedure Rules, 2010
• Civil Procedure Act

Judge Name

Passage Text

• 23. ... the court stated as follows: "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".
• 17. ... 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.
• 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/=.

Damages / Relief Type