[2005] KEHC 1498 (KLR)
The court found that although the plaintiff has a statutory right to seek indemnity from the insurer under section 10(2) of the Motor Vehicle (Third Party) Insurance Act, the 2nd defendant is in liquidation. Under the Companies Act, no action can be brought against a company in liquidation or its receiver without...
Source-derived case information.
- Citation
- [2005] KEHC 1498 (KLR)
- Parties
- Plaintiff: James Mwaura Nd’ung’u; Defendant: The Commissioner of Insurance; Defendant: Lakestar Insurance Co. Ltd (Under Statutory Management); Defendant: Mary Nyambura Waswa (Suing Through Syovinya Lungonzi); Defendant: Simon Mutati (Suing Through Syovinya); Defendant: Teresia Gathoni Gathura; Defendant: Francis Mwaura Chege; Defendant: Milka Wanja; Defendant: Jane Nduku (Suing Through Syovinya Lungonzi); Defendant: Patrick Koki (Suing Through Syovinya Lungonzi); Defendant: Grace Kinyula (Suing Through Syovinya Lungonzi); Defendant: Mary Wanjiku Nyutu; Defendant: Joyce Wairumu Mwangi (Using Through Mary Wanjiku Nyutu)
- Court
- High Court
- Court Station
- High Court at Nairobi (Milimani Commercial Courts)
- Jurisdiction
- Kenya
- Case Number
- Civil Case 190 of 2003
- Procedural Posture
- Civil Case / Ruling on Application to Strike Out Amended Plaint Against 2nd Defendant
- Outcome
- Application allowed. Suit against 2nd defendant struck out with costs against the plaintiff.
- Legal Topics
- Striking Out Pleadings, Insurance Liquidation, Third Party Indemnity
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
James Mwaura Nd’ung’u
Plaintiff
The Commissioner of Insurance
Defendant
Lakestar Insurance Co. Ltd (Under Statutory Management)
Defendant
Mary Nyambura Waswa (Suing Through Syovinya Lungonzi)
Defendant
Simon Mutati (Suing Through Syovinya)
Defendant
Teresia Gathoni Gathura
Defendant
Francis Mwaura Chege
Defendant
Milka Wanja
Defendant
Jane Nduku (Suing Through Syovinya Lungonzi)
Defendant
Patrick Koki (Suing Through Syovinya Lungonzi)
Defendant
Grace Kinyula (Suing Through Syovinya Lungonzi)
Defendant
Mary Wanjiku Nyutu
Defendant
Joyce Wairumu Mwangi (Using Through Mary Wanjiku Nyutu)
Defendant
Procedural Posture
Civil Case / Ruling on Application to Strike Out Amended Plaint Against 2nd Defendant
Legal Issues
- 1 Whether the amended plaint discloses a reasonable cause of action against the 2nd defendant (Lakestar Insurance Co. Ltd).
- 2 Whether an action can be maintained against an insurance company in liquidation without leave of court.
- 3 Whether the suit against the 2nd defendant constitutes an abuse of court process.
Ratio Decidendi
The court found that although the plaintiff has a statutory right to seek indemnity from the insurer under section 10(2) of the Motor Vehicle (Third Party) Insurance Act, the 2nd defendant is in liquidation. Under the Companies Act, no action can be brought against a company in liquidation or its receiver without the leave of the court, which was not obtained in this case. Since no relief was specifically sought against the 2nd defendant and the procedural requirement of obtaining leave was not met, the suit against the 2nd defendant was deemed an abuse of the court process. Consequently, the court struck out the 2nd defendant from the suit with costs against the plaintiff.
Court Disposition
Application allowed. Suit against 2nd defendant struck out with costs against the plaintiff.
Orders
- The suit against the 2nd defendant (Lakestar Insurance Co. Ltd) is struck out.
- Costs awarded to the 2nd defendant against the plaintiff.
Full Case Text
Judgment text and source record
32 paragraphs
REPUBLIC OF KENYA IN THE HIGH COURT OF KENYA AT NAIROBI
Civil Case 190 of 2003
JAMES MWAURA ND’UNG’U ……………….………..………… PLAINTIFF
VERSUS
THE COMMISSIONER OF INSURANCE……….…..……1ST DEFENDANT
LAKESTAR INSURANCE CO. LTD…...………..……….. 2ND DEFENDANT
(Under Statutory Management)
MARY NYAMBURA WASWA ……………..…………… 3RD DEFENDANT
(Suing Through Syovinya Lungonzi)
SIMON MUTATI …………………………..….……………4TH DEFENDANT
(Suing Through Syovinya)
TERESIA GATHONI GATHURA ………….…………….. 5TH DEFENDANT
FRANCIS MWAURA CHEGE ………………..………….. 6TH DEFEDNANT
MILKA WANJA ………………………………….………… 7TH DEFENDANT
JANE NDUKU ………………..…………..…….……………. 8th DEFENDANT
(Suing Through Syovinya Lungonzi)
PATRICK KOKI ……………………………..…………….. 9TH DEFENDANT
(Suing Through Syovinya Lungonzi)
GRACE KINYULA ………………………….….………… 10TH DEFENDANT
(Suing Through Syovinya Lungonzi)
MARY WANJIKU NYUTU ……………..……………….. 11TH DEFENDANT
JOYCE WAIRUMU MWANGI …………….…..………... 12TH DEFENDANT
(Using Through Mary Wanjiku Nyutu)
RULING
This is an application by Lake Star Insurance Co., Ltd (in liquidation) the 2nd Defendant to strike out the Amended Plaint so far as it is concerned on the ground that if fails to disclose any reasonable cause of action against it.
The Application is supported by a Supporting Affidavit. The Application is brought pursuant to the provisions of O.6 rule 13(a) (b) and (c). However Mr. Ligunya sought to rely on O6 rule 13(c) only.
The 2nd Defendant is an Insurance Company, which is now in liquidation. The Amended Plaint alleges in paragraph 11 that the Applicant has a legal obligation to indemnify the Plaintiff for any claims arising out of an insurance policy. This is the policy of insurance referred to in paragraph 9 of the Amended Plaint, which had been issued by the Applicant to the Defendant to indemnify him against third party claims arising out of any liability the Plaintiff might incur in a motor vehicle accident.
No relief is sought against the Applicant. The relief claimed is against the 1st Defendant for alleged breaches of statutory duty to allow the Applicant to continue doing business. Mr. Ndegwa for the Plaintiff/1stRespondent submitted that under section 10(2) of the Motor Vehicle (Third Party) Insurance Act the Plaintiff was entitled to seek indemnity from the Applicant. This is a right which the Plaintiff has. However, in the case the Applicant is in liquidation and under the provisions of the Companies Act no action can be bought against a receiver without the consent of the court, which has not been obtained in this case. That being so I consider the suit against the applicant to be an abuse of the process of the court and strike out the Applicant from this suit with costs against the Plaintiff.
The costs of all other Respondent will be costs in the cause.
DATED and DELIVERED at NAIROBI this 22nd day of April 2005
P.J. RANSLEY
JUDGE