[2020] KEHC 6248 (KLR)
The court found that the Insurance Regulatory Authority (IRA) should not be joined as a party to the proceedings because neither the plaintiff nor the defendants have a claim against IRA. The grounds advanced by the defendants, namely IRA's regulatory role and directives, do not establish a legal basis for its...
Source-derived case information.
- Citation
- [2020] KEHC 6248 (KLR)
- Parties
- Plaintiff: Kenindia Assurance Company Limited; Defendant: The Administrator Nakumatt Holdings Ltd; Defendant: Nakumatt Holdings Ltd (In Administration)
- Court
- High Court
- Court Station
- High Court at Nairobi (Milimani Commercial Courts)
- Jurisdiction
- Kenya
- Case Number
- Civil Suit 029 of 2018
- Procedural Posture
- Civil Suit / Ruling on Application to Join Party
- Outcome
- application dismissed
- Judges
- MM Kasango
- Legal Topics
- Joinder of Parties, Insurance Regulation, Injunctions, Set Off, Liquidation Proceedings
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
More case intelligence is available
Unlock the full research layer for this judgment.
Parties
Kenindia Assurance Company Limited
Plaintiff
The Administrator Nakumatt Holdings Ltd
Defendant
Nakumatt Holdings Ltd (In Administration)
Defendant
Procedural Posture
Civil Suit / Ruling on Application to Join Party
Legal Issues
- 1 Whether the Insurance Regulatory Authority (IRA) should be joined as a party to the proceedings.
- 2 Whether the grounds advanced by the defendants justify the joinder of IRA as a defendant.
Ratio Decidendi
The court found that the Insurance Regulatory Authority (IRA) should not be joined as a party to the proceedings because neither the plaintiff nor the defendants have a claim against IRA. The grounds advanced by the defendants, namely IRA's regulatory role and directives, do not establish a legal basis for its joinder as a defendant. Instead, if IRA's input is required, it can be called as a witness. The application to join IRA as a party was therefore dismissed, as its presence is not necessary for the effective and complete resolution of the dispute between the existing parties.
Court Disposition
application dismissed
Orders
- The Chamber Summons dated 7th August, 2019 seeking to join the Insurance Regulatory Authority as a party is dismissed.
- Costs shall be in the cause.
Full Case Text
Judgment text and source record
26 paragraphs
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA
AT NAIROBI
COMMERCIAL AND ADMIRALTY DIVISION
CIVIL SUIT NO. E 029 OF 2018
KENINDIA ASSURANCE COMPANY LIMITED.......................................PLAINTIFF
- VERSUS -
THE ADMINISTRATOR NAKUMATT HOLDINGS LTD..............1ST DEFENDANT
NAKUMATT HOLDINGS LTD (In Administration).......................2ND DEFENDANT
RULING
1. The administrator of Nakumatt Holdings Limited, the 1st defendant, and Nakumatt Holdings Ltd (In Administration) 2nd defendant were sued by Kenindia Assurance Company Ltd (Kenindia) for an order of injunction to restrain the defendants from commencing liquidation proceedings against the plaintiff, for declaration that Kenindia was not indebted to the defendants for Ksh 181,344,573. 00 and for a declaration that Kenindia is entitled to set off any money payable under insurance claims against any debt.
2. The defendants filed a defence and in that defence the defendants alleged Kenindia had failed to settle claims where discharge vouchers had been executed and returned to them for settlement amongst other allegations. The defendant did not counter claim.
3. The defendant have applied, by chamber summon dated 7th August 2019 for an order for Insurance Regulatory authority (IRA) to be joined as 3rd defendant. Some of the grounds the defendant rely on in regard to that application are:
“WHICH APPLICATION is predicated upon the following grounds:
(a) That Insurance Regulatory Authority (I.R.A) is a statutory government Agency established under the Insurance Act (Amendment 2000) Cap 487 of the Laws of Kenya to regulate supervise and develop the Insurance Industry.
(b) That under Sec 3 (a) of Cap 487, the I.R.A has the legal mandate to issue supervisory guidelines and prudential standards from time to time for the better administration of the insurance industry.
(c) That in the circumstances of this case, the I.R.A has issued directives to the plaintiff herein with regard to the mixing up of insurance and non insurance matters, which directives have been flouted with impunity by the plaintiff without the I.R.A taking any punitive action(s) despite complaints to this effect.
(d) That in order to effectively and finally resolve the matters in dispute now before the Honourable court, it is necessary to enjoin the I.R.A to these proceedings to resolve the common questions of law and fact.”
4. The grounds reproduce above show that IRA should be called as a witness and not be dragged into this case as a party. It is because of that finding and more particularly because beither parties have a claim against IRA that Chamber Summons dated 7th August, 2019 is dismissed. The costs shall be in the cause.
DATED, SIGNED and DELIVERED at NAIROBI this14thday of APRIL,2020.
MARY KASANGO
JUDGE
ORDER
In view of the declaration of measures restricting court operations due to the COVID-19 pandemic and in light of the directions issued by his Lordship, the Chief Justice on 15th March, 2020, this decision has been delivered to the parties online with their consent. They have waived compliance with Order 21 rule 1 of the Civil Procedure Ruleswhich requires that all judgments and rulings be pronounced in open court.
MARY KASANGO
JUDGE