1. The Judgment was entered in the matter before the court below on 23rd October 2020. Despite the appellant's best efforts, attempts to procure payment from the 1st respondent have been unsuccessful.
2. The appellant filed several garnishee applications, one of which was that of 15th January 2025, vide which it sought to have Kes 3,496,575/76, along with accruing interest and costs, paid to it. It thereafter sought to have the decree nisi made absolute vide an application dated 9th June 2025. Although initially reticent, the 1st respondent filed an application dated 27th June 2025 seeking to halt the garnishee proceedings.
3. The court below considered the two applications in a ruling of 31st July 2025. The court dismissed the application dated 27th June 2025 for want of merit. Although it allowed the application dated 9th June 2025, its finding was subject to a cap of Kes 3,000,000/-. The court expressed itself in the following terms:-
“Accordingly, I allow the application dated 9th July 2025 in terms of prayer (d), thereby declaring a decree nisi absolute; however, the sum payable is subject to the statutory cap under section 5 of the Insurance (Motor Vehicle Third Party Risks) Act, which limits the sum payable by the insurance company at Kes 3,000,000/-”.
4. The appellant was aggrieved by the said decision and appealed to this court. The Memorandum of Appeal has 5 grounds, to wit:
1. That the Learned Trial Magistrate erred in law and in fact in effect reviewing the decree of the Court when there was no application to review the same.
2. That the Learned Trial Magistrate erred in law and in fact in capping the sum payable at Kshs.3,000,000/= supposedly under Section 5 of the Insurance (Third party Motor Vehicle Risks Act) whereas the award of costs and interest is not an award made under the said Act but under the Civil Procedure Act.
3. That the Learned Trial Magistrate erred in law and in fact in essence in reverting the sum of Kshs.496,575.72 that was due under the decree nisi to the defendant to the detriment of the Plaintiff/Appellant.
4. That the Learned Trial Magistrate erred in law and in fact in dealing with the issue of the Kshs.3 Million cap without substantive application/submission from the parties.
5. That the Learned trial Magistrate erred in law and in fact in holding that the defendant Insurer was immune from paying costs and interest. Once a claim is for Kshs.3 million, notwithstanding their delay and failure to pay.
5. The appellant seeks the orders that:-
1. That the order capping the sum payable under the decree of the subordinate court at Kes 3,000,000/- be set aside;
2. That the decree nisi of the court dated 9th June 2025 be made absolute to the extent of Kes 3, 496,575/72 as prayed in the application dated 9th June 2025; and
3. That the defendant be ordered to meet the costs and interest as per the decree of the court dated 26th October 2020 and issued on 6th July 2021.
6. The appeal was canvassed by way of written submissions. The appellant's submissions are dated 6th October 2025. In its submissions, the appellant contended that the statutory cap only applied to the principal sum and that costs and interest accruing after judgment were uncapped.
7. In support of its submissions, it relied on the case of Peter Gichihi Njuguna v Jubilee Insurance Co. Ltd [2016] KEHC 5545 (KLR) and that of British American Insurance Co.(K) Ltd v Lazarus Sagini Nyangau & another (Suing as the legal representatives of the estate of Wycliffe Osinyo Sagini (Deceased) [2021] KEHC 3530 (KLR).
8. On its part, the counsel for the 1st respondent argued that I should uphold the ruling of the court below. The 2nd respondent did not take part in the appeal.
9. The question before the Court is a narrow one. Does section 5 of the Insurance (Motor Vehicles Third Party Risks) Act cap the total amount payable by an insurer at Kes 3,000,000/-, inclusive of interest and costs?
10. Section 5 (b) of the Act states in the proviso that:
“Provided that a policy in terms of this section shall not be required to cover.
…
iv. Liability of any sum in excess of three million shillings, arising out of a claim by one person.”
11. I have considered the judgment of the court below. The judgment sum was less than Kes 3,000,000/-. That the sum payable has exceeded Kes 3,000,000/- is clearly attributable to the 1st Respondent, who did everything possible to avoid settling the sum due.
12. I am in agreement with the decision of the Court in the case of Peter Gichihi Njuguna v Jubilee Insurance Co. Ltd [2016] KEHC 5545 (KLR), in which it was held that:
“13. The defendant submits that under the proviso(iv) of Section 5(b), the total amount that the defendant ought to pay in an all inclusive sum should not exceed Kshs.3,000,000/= including costs and interest.
This court begs to differ with the above submission. The Defendant had failed to honour its obligations placed on it by the above section. The plaintiff has spent time and money pursuing payment by filing this declaratory suit. The defendant, at all times, knew or ought to have known that it was its obligation to settle the judgment of the primary suit – even the capped limit. Indeed, it made an offer to pay, which offer was accepted, but it did not pay, and no explanation was tendered for the failure to pay. The suit had to proceed to a full hearing. I have carefully read the section under review.
14. The drafters of the said Act No. 10 of 2006, in my considered view, did not envisage a situation where the insurance company would fail to pay the claim if all conditions are met, as is the case in the present case. To that extent, if by its failure, costs are incurred in pursuance of payment, the defendant ought to be penalized and condemned to pay costs to the plaintiff. Costs ordered by the court in its discretion cannot be construed to include the principal sum, in this case the capped sum of Kshs.3,000,000/=…”
13. In my view, the learned magistrate appears to agree with the foregoing as she went on to state as follows:
“Further, this court orders that the garnishee shall recover its costs assessed at Kes 30,000/- from the sums in the said accounts. The applicant shall also recover the costs of these garnishee proceedings assessed at Kes 30,000/- from the said accounts.”
14. My understanding of the learned magistrate’s decision is that she recognised that costs and interest aren’t subject to the cap of Kes 3,000,000/-.
15. It must also be noted that the issues raised in the court below came about due to the conduct of the 1st respondent. Had it paid the judgment sum without delay, we wouldn’t be here. In essence, the 1st respondent seeks to benefit from its mischief. This shouldn’t be allowed.
16. In the case of MUTETE NDONYE v MULI MUNYAO & 4 others [2012] KEHC 2707 (KLR):-
“A party cannot be allowed to benefit from her own mischief on account of the provisions of law. It is just harsh and unconscionable.”
17. In my view, the appeal has merit. The same is allowed. I order that:
1. I set aside the order capping the sum payable in this matter at Kes 3,000,00/-;
2. I make the decree nisi dated 9th June 2025 absolute to the extent of Kes 3,496,575/72 as prayed in the application dated 9th June 2025;
3. The 1st respondent shall meet the costs and interest accruing from the judgment of the court dated 20th October 2020 and issued on 6th July 2021.
18. The appellant shall have costs of the appeal.
19. It is so ordered.
Dated and signed at Nairobi this 7th day of July 2026.
2. The appellant filed several garnishee applications, one of which was that of 15th January 2025, vide which it sought to have Kes 3,496,575/76, along with accruing interest and costs, paid to it. It thereafter sought to have the decree nisi made absolute vide an application dated 9th June 2025. Although initially reticent, the 1st respondent filed an application dated 27th June 2025 seeking to halt the garnishee proceedings.
3. The court below considered the two applications in a ruling of 31st July 2025. The court dismissed the application dated 27th June 2025 for want of merit. Although it allowed the application dated 9th June 2025, its finding was subject to a cap of Kes 3,000,000/-. The court expressed itself in the following terms:-
“Accordingly, I allow the application dated 9th July 2025 in terms of prayer (d), thereby declaring a decree nisi absolute; however, the sum payable is subject to the statutory cap under section 5 of the Insurance (Motor Vehicle Third Party Risks) Act, which limits the sum payable by the insurance company at Kes 3,000,000/-”.
4. The appellant was aggrieved by the said decision and appealed to this court. The Memorandum of Appeal has 5 grounds, to wit:
1. That the Learned Trial Magistrate erred in law and in fact in effect reviewing the decree of the Court when there was no application to review the same.
2. That the Learned Trial Magistrate erred in law and in fact in capping the sum payable at Kshs.3,000,000/= supposedly under Section 5 of the Insurance (Third party Motor Vehicle Risks Act) whereas the award of costs and interest is not an award made under the said Act but under the Civil Procedure Act.
3. That the Learned Trial Magistrate erred in law and in fact in essence in reverting the sum of Kshs.496,575.72 that was due under the decree nisi to the defendant to the detriment of the Plaintiff/Appellant.
4. That the Learned Trial Magistrate erred in law and in fact in dealing with the issue of the Kshs.3 Million cap without substantive application/submission from the parties.
5. That the Learned trial Magistrate erred in law and in fact in holding that the defendant Insurer was immune from paying costs and interest. Once a claim is for Kshs.3 million, notwithstanding their delay and failure to pay.
5. The appellant seeks the orders that:-
1. That the order capping the sum payable under the decree of the subordinate court at Kes 3,000,000/- be set aside;
2. That the decree nisi of the court dated 9th June 2025 be made absolute to the extent of Kes 3, 496,575/72 as prayed in the application dated 9th June 2025; and
3. That the defendant be ordered to meet the costs and interest as per the decree of the court dated 26th October 2020 and issued on 6th July 2021.
6. The appeal was canvassed by way of written submissions. The appellant's submissions are dated 6th October 2025. In its submissions, the appellant contended that the statutory cap only applied to the principal sum and that costs and interest accruing after judgment were uncapped.
7. In support of its submissions, it relied on the case of Peter Gichihi Njuguna v Jubilee Insurance Co. Ltd [2016] KEHC 5545 (KLR) and that of British American Insurance Co.(K) Ltd v Lazarus Sagini Nyangau & another (Suing as the legal representatives of the estate of Wycliffe Osinyo Sagini (Deceased) [2021] KEHC 3530 (KLR).
8. On its part, the counsel for the 1st respondent argued that I should uphold the ruling of the court below. The 2nd respondent did not take part in the appeal.
9. The question before the Court is a narrow one. Does section 5 of the Insurance (Motor Vehicles Third Party Risks) Act cap the total amount payable by an insurer at Kes 3,000,000/-, inclusive of interest and costs?
10. Section 5 (b) of the Act states in the proviso that:
“Provided that a policy in terms of this section shall not be required to cover.
…
iv. Liability of any sum in excess of three million shillings, arising out of a claim by one person.”
11. I have considered the judgment of the court below. The judgment sum was less than Kes 3,000,000/-. That the sum payable has exceeded Kes 3,000,000/- is clearly attributable to the 1st Respondent, who did everything possible to avoid settling the sum due.
12. I am in agreement with the decision of the Court in the case of Peter Gichihi Njuguna v Jubilee Insurance Co. Ltd [2016] KEHC 5545 (KLR), in which it was held that:
“13. The defendant submits that under the proviso(iv) of Section 5(b), the total amount that the defendant ought to pay in an all inclusive sum should not exceed Kshs.3,000,000/= including costs and interest.
This court begs to differ with the above submission. The Defendant had failed to honour its obligations placed on it by the above section. The plaintiff has spent time and money pursuing payment by filing this declaratory suit. The defendant, at all times, knew or ought to have known that it was its obligation to settle the judgment of the primary suit – even the capped limit. Indeed, it made an offer to pay, which offer was accepted, but it did not pay, and no explanation was tendered for the failure to pay. The suit had to proceed to a full hearing. I have carefully read the section under review.
14. The drafters of the said Act No. 10 of 2006, in my considered view, did not envisage a situation where the insurance company would fail to pay the claim if all conditions are met, as is the case in the present case. To that extent, if by its failure, costs are incurred in pursuance of payment, the defendant ought to be penalized and condemned to pay costs to the plaintiff. Costs ordered by the court in its discretion cannot be construed to include the principal sum, in this case the capped sum of Kshs.3,000,000/=…”
13. In my view, the learned magistrate appears to agree with the foregoing as she went on to state as follows:
“Further, this court orders that the garnishee shall recover its costs assessed at Kes 30,000/- from the sums in the said accounts. The applicant shall also recover the costs of these garnishee proceedings assessed at Kes 30,000/- from the said accounts.”
14. My understanding of the learned magistrate’s decision is that she recognised that costs and interest aren’t subject to the cap of Kes 3,000,000/-.
15. It must also be noted that the issues raised in the court below came about due to the conduct of the 1st respondent. Had it paid the judgment sum without delay, we wouldn’t be here. In essence, the 1st respondent seeks to benefit from its mischief. This shouldn’t be allowed.
16. In the case of MUTETE NDONYE v MULI MUNYAO & 4 others [2012] KEHC 2707 (KLR):-
“A party cannot be allowed to benefit from her own mischief on account of the provisions of law. It is just harsh and unconscionable.”
17. In my view, the appeal has merit. The same is allowed. I order that:
1. I set aside the order capping the sum payable in this matter at Kes 3,000,00/-;
2. I make the decree nisi dated 9th June 2025 absolute to the extent of Kes 3,496,575/72 as prayed in the application dated 9th June 2025;
3. The 1st respondent shall meet the costs and interest accruing from the judgment of the court dated 20th October 2020 and issued on 6th July 2021.
18. The appellant shall have costs of the appeal.
19. It is so ordered.
Dated and signed at Nairobi this 7th day of July 2026.