Introduction and Background
1. Before the court for determination is an appeal filed by the Appellant against the ruling of the subordinate court dated 6 th March 2025 (“the Ruling”). For context, I will highlight a brief background of the dispute emerging before the subordinate court. By a plaint dated 29 th June 2022, the Appellant filed suit stating that she was a lawful passenger in motor vehicle registration KCT ***R on 19 th March 2022 whereas the 1 st Respondent was the driver and the 2 nd Respondent was the registered owner. She claimed that the 1 st Respondent negligently drove the vehicle, causing the rear wheel to detach, leading to the vehicle rolling and causing the Appellant injuries. The Appellant thus sought general damages for pain and suffering and loss of amenities, special damages, costs and interest.
2. In its judgment dated 22 nd August 2024, the subordinate court found the Respondents 100% liable since the Appellant’s evidence was uncontroverted as the Respondents called no witnesses. The court then awarded the Appellant Kshs. 1,500,000.00 for pain and suffering, considering the nature of injuries and comparable authorities and special damages totaling Kshs. 22,190.00. Thus, the total decretal sum was Kshs. 1,522,190.00 plus costs and interest and a 30-day stay of execution was granted.
3. By an application dated 12 th November 2024, the Respondents sought a stay of execution of the decree pending the hearing and determination of a disclaimer suit filed by the Respondents’ insurer in Kithimani MCCC E158 of 2024 against the 2 nd Respondent in which the insurer sought a declaration that it is not liable for the accident due to a policy breach. The Respondents argued that the outcome of the disclaimer suit would affect the execution process in the suit before the subordinate court and that if execution proceeded, the disclaimer suit would be rendered nugatory and the Respondents would suffer irreparable harm.
4. In the Ruling, the learned magistrate allowed the application and stayed the execution of the decree reasoning it would be fair and reasonable to first determine the issue of whether the Respondents were still covered by the insurance policy in the disclaimer suit before ordering them to pay the decretal sum. The trial court noted that the Appellant had raised an issue on the viability of the disclaimer suit but found that there was no evidence that any formal opposition had been filed in that suit for the trial court to determine its merits. The trial court stated that any objections to the disclaimer suit would be dealt with on their merits in that separate suit and therefore, the opposition raised by the Appellant in the application was not merited.
5. Through the Memorandum of Appeal dated 12 th March dated 12 th March 2025, the Appellant expresses her dissatisfaction to the Ruling as follows:
1) The Learned Magistrate erred in law and fact by granting a stay of proceedings on the basis that a disclaimer suit had been instituted, despite the disclaimer suit being in direct contravention of the mandatory provisions of Section 10 of the Insurance (Motor Vehicles Third Party Risks) Act, Cap 405 Laws of Kenya.
2) The Learned Magistrate misdirected himself in failing to appreciate that the Appellant is not a party to the disclaimer suit and, therefore, the existence of such a suit cannot lawfully operate as a bar to the enforcement of the valid judgment in favor of the Appellant.
3) The Learned Magistrate erred in law in holding that the outcome of the disclaimer suit could affect the rights of the Appellant, whereas Section 10(4) of the Insurance (Motor Vehicles Third Party Risks) Act expressly provides that an insurer remains liable to satisfy a judgment unless a valid disclaimer is issued before the judgment is entered.
4) The Learned Magistrate erred in failing to appreciate that the Application for stay of proceedings was an abuse of the court process and a calculated attempt by the Respondent to unjustly deny the Appellant the fruits of a valid judgment.
5) The Learned Magistrate failed to consider that the disclaimer was a scheme to delay execution and frustrate the Appellant’s rights as a decree holder, contrary to the principles of justice and fair trial.
6. As such, the Appellant seeks that the appeal be allowed, that the Ruling be set aside and that the stay of proceedings be lifted and execution do proceed against the Respondents. The appeal has been canvassed by way of written submissions which I have considered together with the record and I will make relevant references to them in my analysis and determination below
Analysis and Determination
7. The court is being called upon to determine whether the subordinate court’s magistrate was wrong to allow the Respondents’ application and stay the execution of the decree pending the hearing and determination of the disclaimer suit. I am in agreement with the Respondents’ submission that this was a discretionary decision and this court, as the appellate court, will not interfere with that decision unless it is satisfied that the subordinate court in exercising its discretion has misdirected itself in some matter and as a result has arrived at a wrong decision, or unless it is manifest from the case as a whole that the trial court has been clearly wrong in the exercise of its discretion and that as a result there has been an injustice (see Mbogo v Shah [1968] EA 93 and United India Insurance Co Ltd v East African Underwriters (Kenya) Ltd [1985] KECA 39 (KLR) ].
8. Having gone through the record of appeal and the submissions, I am in agreement with the Appellant that the learned magistrate appears to have erred in law by anchoring his decision on the existence of the disclaimer suit without fully considering its validity, binding authorities and the mandatory legal framework governing such suits. Indeed, the duty of an insurer to satisfy judgments against persons insured is provided for under section 10(1) of the Insurance (Motor Vehicle Third Party Risks) Act as follows;
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….
9. Section 10(2) of the Act provides for instances where an insurer can avoid the statutory obligation to pay the judgment and section 10(2)(a) therein states that:
‘(2) No sum shall be payable by an insurer under the foregoing provisions of this section—
(a) in respect of any judgment, unless before or within fourteen days after the commencement of the proceedings in which the judgment was given, the insurer had notice of the bringing of the proceedings ;
10. Section 10(4) of the Act then goes on to provide that:
No sum shall be payable by an insurer under the foregoing provisions of this section if in an action commenced before, or within three months after, the commencement of the proceedings in which the judgment was given, he has obtained a declaration that, apart from any provision contained in the policy he is entitled to avoid it on the ground that it was obtained by the non-disclosure of a material fact, or by a representation of fact which was false in some material particular, or, if he has avoided the policy on that ground, that he was entitled so to do apart from any provision contained in it:
Provided that an insurer who has obtained such a declaration as aforesaid in an action shall not thereby become entitled to the benefit of this subsection as respects any judgment obtained in proceedings commenced before the commencement of that action, unless before or within fourteen days after the commencement of that action he has given notice thereof to the person who is the plaintiff in the said proceedings specifying the non-disclosure or false representation on which he proposes to rely, and any person to whom notice of such action is so given shall be entitled, if he thinks fit, to be made a party thereto.
11. This court (Gikonyo J.,) in Britam Insurance Co Ltd v Jane Muthoni Mwangi;Kevin Ouma Ochieng & 3 others (Interested Parties) [2021] KEHC 2131 (KLR) affirmed that the aforementioned section makes three pertinent requirements of a disclaimer suit: i) that the suit should be filed before or within three months of the filing of the suit by the third parties; ii) notice with details of grounds of disclaimer is given before or within 14 days of the commencement of the disclaimer suit to the plaintiff in the primary suit; and iii) the person to whom notice of action is so given shall be entitled to be made a party thereto.
12. Mrima J., in APA Insurance Limited v Gabriel Opondo Ogenga (Suing as the legal representative of Jane Akinyi Saida - Deceased) [2018] KEHC 7398 (KLR) found that a disclaimer suit filed four months after the primary suit was filed was in contravention of section 10(4) of the Act and that the insurer's liability stood, despite the judgment in the disclaimer suit, because the suit itself was a nullity for being filed out of time. The court therein also emphasized that a judgment obtained pursuant to section 10 of the Act is strictly subject to the conditions contained in the said section of the law.
13. Applying these principles to the present case, the primary suit was filed on 17 th August 2022 while the disclaimer suit was filed on 9 th October 2024 which is more than two years later. This timeline, on its face, flies in the face of the statutory deadline and the aforementioned binding precedents that the subordinate court ought to have followed. By granting a stay of a valid judgment based on what appears to be an invalid disclaimer suit, the trial magistrate effectively gave legal effect to a suit that may be a legal nullity. The Respondents’ submission that the learned magistrate only recognized the existence of pending litigation is disingenuous as the order of stay directly gives force to that pending litigation to the detriment of the Appellant as the decree holder.
14. I am therefore in agreement with the Appellant’s submission that the subordinate court’s decision to stay the execution was not a proper exercise of discretion. It was based on a misapprehension of the law concerning mandatory statutory timelines for disclaimer suits, as affirmed by this court. By doing so, the subordinate court failed to protect the Appellant's right to enjoy the fruits of her judgment, an injustice that cannot be countenanced under the guise of judicial discretion.
Conclusion and Disposition
15. For the above reasons, it is my finding that the Appellant’s appeal has merit and it is allowed. The subordinate court’s ruling dated 6 th March 2025 is set aside with the consequence that the application dated 12 th November 2024 by the Respondents is dismissed and the stay orders issued by the subordinate court are lifted and the Appellant is at liberty to execute. The Appellant is also awarded costs of the application before the subordinate court and this appeal all assessed at Kshs. 50,000.00.
DATED SIGNED AND DELIVERED virtually this 3 rd DAY OF SEPTEMBER
2026
............................................................................
J W W MONGARE
JUDGE
IN THE PRESENCE OF
1. N/A for the Appellant
2. N/A for the Respondent
3. Abdisalan- Court Assistant
2 | Page
1. Before the court for determination is an appeal filed by the Appellant against the ruling of the subordinate court dated 6 th March 2025 (“the Ruling”). For context, I will highlight a brief background of the dispute emerging before the subordinate court. By a plaint dated 29 th June 2022, the Appellant filed suit stating that she was a lawful passenger in motor vehicle registration KCT ***R on 19 th March 2022 whereas the 1 st Respondent was the driver and the 2 nd Respondent was the registered owner. She claimed that the 1 st Respondent negligently drove the vehicle, causing the rear wheel to detach, leading to the vehicle rolling and causing the Appellant injuries. The Appellant thus sought general damages for pain and suffering and loss of amenities, special damages, costs and interest.
2. In its judgment dated 22 nd August 2024, the subordinate court found the Respondents 100% liable since the Appellant’s evidence was uncontroverted as the Respondents called no witnesses. The court then awarded the Appellant Kshs. 1,500,000.00 for pain and suffering, considering the nature of injuries and comparable authorities and special damages totaling Kshs. 22,190.00. Thus, the total decretal sum was Kshs. 1,522,190.00 plus costs and interest and a 30-day stay of execution was granted.
3. By an application dated 12 th November 2024, the Respondents sought a stay of execution of the decree pending the hearing and determination of a disclaimer suit filed by the Respondents’ insurer in Kithimani MCCC E158 of 2024 against the 2 nd Respondent in which the insurer sought a declaration that it is not liable for the accident due to a policy breach. The Respondents argued that the outcome of the disclaimer suit would affect the execution process in the suit before the subordinate court and that if execution proceeded, the disclaimer suit would be rendered nugatory and the Respondents would suffer irreparable harm.
4. In the Ruling, the learned magistrate allowed the application and stayed the execution of the decree reasoning it would be fair and reasonable to first determine the issue of whether the Respondents were still covered by the insurance policy in the disclaimer suit before ordering them to pay the decretal sum. The trial court noted that the Appellant had raised an issue on the viability of the disclaimer suit but found that there was no evidence that any formal opposition had been filed in that suit for the trial court to determine its merits. The trial court stated that any objections to the disclaimer suit would be dealt with on their merits in that separate suit and therefore, the opposition raised by the Appellant in the application was not merited.
5. Through the Memorandum of Appeal dated 12 th March dated 12 th March 2025, the Appellant expresses her dissatisfaction to the Ruling as follows:
1) The Learned Magistrate erred in law and fact by granting a stay of proceedings on the basis that a disclaimer suit had been instituted, despite the disclaimer suit being in direct contravention of the mandatory provisions of Section 10 of the Insurance (Motor Vehicles Third Party Risks) Act, Cap 405 Laws of Kenya.
2) The Learned Magistrate misdirected himself in failing to appreciate that the Appellant is not a party to the disclaimer suit and, therefore, the existence of such a suit cannot lawfully operate as a bar to the enforcement of the valid judgment in favor of the Appellant.
3) The Learned Magistrate erred in law in holding that the outcome of the disclaimer suit could affect the rights of the Appellant, whereas Section 10(4) of the Insurance (Motor Vehicles Third Party Risks) Act expressly provides that an insurer remains liable to satisfy a judgment unless a valid disclaimer is issued before the judgment is entered.
4) The Learned Magistrate erred in failing to appreciate that the Application for stay of proceedings was an abuse of the court process and a calculated attempt by the Respondent to unjustly deny the Appellant the fruits of a valid judgment.
5) The Learned Magistrate failed to consider that the disclaimer was a scheme to delay execution and frustrate the Appellant’s rights as a decree holder, contrary to the principles of justice and fair trial.
6. As such, the Appellant seeks that the appeal be allowed, that the Ruling be set aside and that the stay of proceedings be lifted and execution do proceed against the Respondents. The appeal has been canvassed by way of written submissions which I have considered together with the record and I will make relevant references to them in my analysis and determination below
Analysis and Determination
7. The court is being called upon to determine whether the subordinate court’s magistrate was wrong to allow the Respondents’ application and stay the execution of the decree pending the hearing and determination of the disclaimer suit. I am in agreement with the Respondents’ submission that this was a discretionary decision and this court, as the appellate court, will not interfere with that decision unless it is satisfied that the subordinate court in exercising its discretion has misdirected itself in some matter and as a result has arrived at a wrong decision, or unless it is manifest from the case as a whole that the trial court has been clearly wrong in the exercise of its discretion and that as a result there has been an injustice (see Mbogo v Shah [1968] EA 93 and United India Insurance Co Ltd v East African Underwriters (Kenya) Ltd [1985] KECA 39 (KLR) ].
8. Having gone through the record of appeal and the submissions, I am in agreement with the Appellant that the learned magistrate appears to have erred in law by anchoring his decision on the existence of the disclaimer suit without fully considering its validity, binding authorities and the mandatory legal framework governing such suits. Indeed, the duty of an insurer to satisfy judgments against persons insured is provided for under section 10(1) of the Insurance (Motor Vehicle Third Party Risks) Act as follows;
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….
9. Section 10(2) of the Act provides for instances where an insurer can avoid the statutory obligation to pay the judgment and section 10(2)(a) therein states that:
‘(2) No sum shall be payable by an insurer under the foregoing provisions of this section—
(a) in respect of any judgment, unless before or within fourteen days after the commencement of the proceedings in which the judgment was given, the insurer had notice of the bringing of the proceedings ;
10. Section 10(4) of the Act then goes on to provide that:
No sum shall be payable by an insurer under the foregoing provisions of this section if in an action commenced before, or within three months after, the commencement of the proceedings in which the judgment was given, he has obtained a declaration that, apart from any provision contained in the policy he is entitled to avoid it on the ground that it was obtained by the non-disclosure of a material fact, or by a representation of fact which was false in some material particular, or, if he has avoided the policy on that ground, that he was entitled so to do apart from any provision contained in it:
Provided that an insurer who has obtained such a declaration as aforesaid in an action shall not thereby become entitled to the benefit of this subsection as respects any judgment obtained in proceedings commenced before the commencement of that action, unless before or within fourteen days after the commencement of that action he has given notice thereof to the person who is the plaintiff in the said proceedings specifying the non-disclosure or false representation on which he proposes to rely, and any person to whom notice of such action is so given shall be entitled, if he thinks fit, to be made a party thereto.
11. This court (Gikonyo J.,) in Britam Insurance Co Ltd v Jane Muthoni Mwangi;Kevin Ouma Ochieng & 3 others (Interested Parties) [2021] KEHC 2131 (KLR) affirmed that the aforementioned section makes three pertinent requirements of a disclaimer suit: i) that the suit should be filed before or within three months of the filing of the suit by the third parties; ii) notice with details of grounds of disclaimer is given before or within 14 days of the commencement of the disclaimer suit to the plaintiff in the primary suit; and iii) the person to whom notice of action is so given shall be entitled to be made a party thereto.
12. Mrima J., in APA Insurance Limited v Gabriel Opondo Ogenga (Suing as the legal representative of Jane Akinyi Saida - Deceased) [2018] KEHC 7398 (KLR) found that a disclaimer suit filed four months after the primary suit was filed was in contravention of section 10(4) of the Act and that the insurer's liability stood, despite the judgment in the disclaimer suit, because the suit itself was a nullity for being filed out of time. The court therein also emphasized that a judgment obtained pursuant to section 10 of the Act is strictly subject to the conditions contained in the said section of the law.
13. Applying these principles to the present case, the primary suit was filed on 17 th August 2022 while the disclaimer suit was filed on 9 th October 2024 which is more than two years later. This timeline, on its face, flies in the face of the statutory deadline and the aforementioned binding precedents that the subordinate court ought to have followed. By granting a stay of a valid judgment based on what appears to be an invalid disclaimer suit, the trial magistrate effectively gave legal effect to a suit that may be a legal nullity. The Respondents’ submission that the learned magistrate only recognized the existence of pending litigation is disingenuous as the order of stay directly gives force to that pending litigation to the detriment of the Appellant as the decree holder.
14. I am therefore in agreement with the Appellant’s submission that the subordinate court’s decision to stay the execution was not a proper exercise of discretion. It was based on a misapprehension of the law concerning mandatory statutory timelines for disclaimer suits, as affirmed by this court. By doing so, the subordinate court failed to protect the Appellant's right to enjoy the fruits of her judgment, an injustice that cannot be countenanced under the guise of judicial discretion.
Conclusion and Disposition
15. For the above reasons, it is my finding that the Appellant’s appeal has merit and it is allowed. The subordinate court’s ruling dated 6 th March 2025 is set aside with the consequence that the application dated 12 th November 2024 by the Respondents is dismissed and the stay orders issued by the subordinate court are lifted and the Appellant is at liberty to execute. The Appellant is also awarded costs of the application before the subordinate court and this appeal all assessed at Kshs. 50,000.00.
DATED SIGNED AND DELIVERED virtually this 3 rd DAY OF SEPTEMBER
2026
............................................................................
J W W MONGARE
JUDGE
IN THE PRESENCE OF
1. N/A for the Appellant
2. N/A for the Respondent
3. Abdisalan- Court Assistant
2 | Page