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Okal v APA Insurance (Civil Appeal E175 of 2024) [2026] KEHC 11007 (KLR) (20 July 2026) (Judgment) Neutral citation: [2026] KEHC 11007 (KLR) Republic of Kenya In the High Court at Mombasa Civil Appeal E175 of 2024 NM Orina, J July 20, 2026 Between Moses Okal Appellant and APA Insurance Respondent (Being an appeal from the ruling of Hon. G. Sogomo (PM) delivered on 24th May 2024 in Mombasa CMCC No. E1532 of 2023) Judgment A. Background 1.This appeal arises from the ruling delivered on 24 May 2024 in Mombasa CMCC No. E1532 of 2023, wherein the trial court upheld the Respondent's Preliminary Objection dated 22 January 2024 and consequently dismissed the Appellant's suit with costs. 2.The dispute traces its origin to a road traffic accident which occurred on 30 January 2016 along the Mombasa–Nairobi Road involving Motor Vehicle Registration No. KCC 820W - Scania Tipper, which was insured by the Respondent and registered in the name of Mohamed Aden Quresh. The Appellant contended that the insured motor vehicle rammed into another motor vehicle, which in turn collided with his vehicle, thereby occasioning material damage. 3.Following the accident, the Appellant instituted Mombasa RMCC No. 1841 of 2017 against Mohamed Aden Quresh, the owner and/or driver of the insured motor vehicle. Upon hearing the matter, the trial court entered judgment in favour of the Appellant on 25 August 2021, awarding him Kshs. 291,542/=, together with costs and interest at court rates. 4.The Appellant averred that prior to the institution of the primary suit, the Respondent had been duly notified of the intended proceedings through a statutory notice and demand letter dated 10 May 2017. He maintained that despite being aware of the proceedings and the resultant decree, the Respondent failed and/or neglected to satisfy the decretal sum. 5.Consequently, by a Plaint dated 11 December 2023, the Appellant instituted Mombasa CMCC No. E1532 of 2023 seeking, inter alia, a declaration that the Respondent was liable to satisfy the decree issued in Mombasa RMCC No. 1841 of 2017, payment of the decretal sum of Kshs. 291,542/= together with accrued interest and costs, and such further relief as the court deemed fit. 6.In response, the Respondent entered appearance, filed a Statement of Defence and subsequently raised a Preliminary Objection dated 22 January 2024 (PO). In the PO, the Respondent contended that the trial court lacked jurisdiction to entertain the claim and that the decree sought to be enforced arose from a claim for material damage, which was not enforceable under the provisions of the Insurance (Motor Vehicles Third Party Risks) Act, Cap. 405. 7.The trial court directed that the PO be canvassed in the first instance by way of written submissions. Upon considering the parties' rival arguments, the learned Principal Magistrate, in a ruling delivered on 24 May 2024, upheld the PO and dismissed the Appellant's suit with costs. 8.Aggrieved by that decision, the Appellant lodged the present appeal. B. The Appeal 9.The Appellant preferred the present appeal vide a Memorandum of Appeal dated 19 June 2024 raising the following grounds:a.That the learned Principal Magistrate erred in law and fact in upholding a preliminary objection which required some documentary proof;b.That the learned Principal Magistrate erred in law and fact in failing to consider the case law (authorities) relied upon by the Appellant which had addressed in detail the issue of declaratory suits with respect to material damage claims;c.That the learned Principal Magistrate erred in law and fact in coming up with a decision without giving reasons for the said decision;d.That the learned Principal Magistrate erred in law and fact in totally ignoring the Appellant's reasoning in toto without mentioning the same and without giving reasons as to why;e.That the learned Principal Magistrate erred in law and fact in laying emphasis only on Section 5 of the Insurance (Motor Vehicles Third Party Risks) Act without taking into consideration the fact that the said provision must be read together with Section 10 in order to appreciate the letter and spirit of the Act; 10.The Appellant filed written submissions dated 29 May 2026 in support of the appeal. He submits that the Preliminary Objection did not raise a pure point of law but instead raised factual issues requiring evidentiary proof. According to the Appellant, matters such as the existence and terms of the insurance policy, service of the statutory notice and whether the Respondent had been duly notified of the proceedings could only be established through evidence and could not properly be determined through a preliminary objection. 11.The Appellant further submits that the learned trial magistrate failed to consider binding and persuasive authorities placed before the court on the question of declaratory suits arising from material damage claims. It was contended that the court thereby arrived at an erroneous conclusion. 12.The Appellant argues further that the Insurance (Motor Vehicles Third Party Risks) Act, Cap. 405, when read holistically, empowers courts to enforce judgments against insurers and that the learned magistrate erred by placing exclusive reliance on Section 5 of the Act while disregarding the import of Section 10(1). 13.The Appellant further submits that Section 10(1) specifically refers to “a liability covered by the terms of the policy” and that if the Respondent intended to avoid liability, it was incumbent upon it to produce the policy document demonstrating the extent and limitations of the cover issued to its insured. 14.The Appellant also contends that the proposition that material damage claims are unenforceable under Cap. 405 has since been overtaken by judicial developments. In support of that argument, he places reliance on Joseph Mwangi Gitundu v Gateway Insurance Company Limited [2015] eKLR and Jubilee Insurance Company Limited v Walter Tondo Soita [2021] eKLR. The Appellant therefore urges the Court to allow the appeal and set aside the ruling of the trial court. 15.The Respondent opposes the appeal through written submissions dated 16 June 2026 and urges the Court to uphold the ruling of the trial court. It maintains that the Preliminary Objection raised a pure point of law and was properly determined on the assumption that all the facts pleaded in the Plaint were true. 16.The Respondent submitts that even if all the facts pleaded by the Appellant were assumed to be correct, the Appellant's claim remained one for material damage arising from damage to a motor vehicle and therefore fell outside the statutory framework created by Sections 5 and 10 of the Insurance (Motor Vehicles Third Party Risks) Act. According to the Respondent, Section 10 only applies to policies issued pursuant to Section 5(b) of the Act, which limits compulsory insurance cover to liabilities arising from death or bodily injury to third parties. 17.The Respondent further contends that the Appellant was not suing as an insured person under a policy issued by the Respondent but rather as a third party seeking to enforce a judgment obtained against the Respondent's alleged insured in Mombasa RMCC No. 1841 of 2017. It was argued that the Appellant had no contractual relationship with the Respondent and could only pursue the insurer within the confines of the statutory rights conferred under Cap. 405. 18.The Respondent distinguishes the authorities relied upon by the Appellant, particularly Joseph Mwangi Gitundu v Gateway Insurance Company Limited [2015] eKLR, on the basis that the dispute therein involved an insurer and its insured and did not concern a third-party claim founded on material damage. The Respondent further argues that the decision in Jubilee Insurance Company Limited v Walter Tondo Soita [2021] eKLR is distinguishable and cannot override binding decisions of the Court of Appeal and other High Court decisions which have consistently held that judgments arising from material damage claims are not enforceable against insurers under Section 10 of the Act. 19.In support of its position, the Respondent relies on Phoenix of East Africa Assurance Co. Ltd v Alfred Onyango Obondo [2011] eKLR. The Respondent maintains that this authority establishes that a third party cannot invoke Section 10 of the Act to enforce a decree founded purely on material damage and therefore urges the Court to dismiss the appeal with costs. C. Analysis and Determination 20.Having considered the Memorandum of Appeal, the Record of Appeal, the impugned ruling, the Parties’ respective written submissions, the issues arising for determination are:i.Whether the trial court erred in upholding the Preliminary Objection dated 22nd January 2024 and consequently dismissing the Appellant's suit.ii.Who should bear the costs of the appeal. I. Whether the trial court erred in upholding the Preliminary Objection dated 22nd January 2024 and consequently dismissing the Appellant's suit 21.The impugned ruling was founded on the Respondent's Preliminary Objection dated 22 January 2024. The Respondent contended that the Appellant's claim sought to enforce a decree arising from material damage and was therefore not maintainable under Sections 5 and 10 of the Insurance (Motor Vehicles Third Party Risks) Act, Cap. 405. 22.The law governing preliminary objections is settled. In Mukisa Biscuit Manufacturing Co. Ltd v West End Distributors Ltd [1969] EA 696, Law JA held as follows:A preliminary objection consists of a point of law which has been pleaded, or which arises by clear implication out of pleadings, and which if argued as a preliminary point may dispose of the suit. 23.These principles have been consistently reaffirmed by superior courts. In Oraro v Mbaja [2005] eKLR, the Court observed that a matter ceases to be a preliminary objection where the court is called upon to investigate facts or exercise discretion. Likewise, in Independent Electoral and Boundaries Commission v Jane Cheperenger & 2 Others [2015] eKLR, the Supreme Court emphasized that a preliminary objection must rest on uncontested facts and a pure point of law. The court held:16.It is quite clear that a preliminary objection should be founded upon a settled and crisp point of law, to the intent that its application to undisputed facts, leads to but one conclusion: that the facts are incompatible with that point of law. 24.A review of the Plaint dated 11 December 2023 shows that the Appellant pleaded that the Respondent insured Motor Vehicle Registration No. KCC 820W; that the Appellant obtained judgment against the insured in Mombasa RMCC No. 1841 of 2017; that statutory notices were issued to the Respondent on 10 May 2017 prior to the institution of the primary suit and subsequent demands were made thereafter and that the Respondent had failed to satisfy the decree despite notice. 25.The Respondent, on the other hand, contended that the decree arose from a claim for material damage and was therefore unenforceable under Cap. 405. In essence, the Respondent's case was that the liability embodied in the decree did not fall within the scope of the statutory obligation imposed upon an insurer. 26.In my considered view, that contention could not be conclusively determined without evidence. Whether the liability sought to be enforced was covered or excluded under the insurance policy is not a matter that can be discerned from pleadings alone. It necessarily requires examination of the policy itself and the terms governing the cover issued by the Respondent. 27.This position finds support in APA Insurance Limited v Njenga (Civil Appeal E084 of 2023) [2024] KEHC 7002 (KLR) where the Court held:I understand the import of the above provision of the law to be that for liability to accrue under Section 10 of the Insurance (Motor Vehicle Third Party Risks) Act CAP 405, there is a 4-fold test to be met...…The Appellant however did not prove the fact of how Respondent's claim could be excluded from the Application of the Insurance (Motor Vehicle Third Party Risks) Act CAP 405. 28.Equally instructive is Jubilee Insurance Co. Ltd v Walter Tondo Soita [2021] eKLR, where the Court held:The provisions of Sections 107 and 108 of the Evidence Act come into play. If the appellant wanted the court to believe that material damage is not covered by the policy, it was duty bound to adduce evidence for the court to find in its favour. 29.The foregoing authorities emphasize that where an insurer asserts that a particular claim falls outside the policy or outside the statutory framework, such assertion is evidentiary in nature and must be proved. Sections 107 and 108 of the Evidence Act place the burden upon the party asserting the existence of a fact. In the present case, it was the Respondent who asserted that the Appellant's claim was excluded from the policy and from the operation of Cap. 405. 30.Notably, no policy document was produced before the trial court to demonstrate the nature of the cover issued, the extent of the risks insured, or the exclusions relied upon by the Respondent. The trial court was therefore invited to determine a substantive issue concerning the scope of insurance cover without the benefit of evidence. 31.Further, Section 10(1) of Cap. 405 refers to a judgment obtained in respect of a liability, “being a liability covered by the terms of the policy.” Whether a liability is covered by the terms of a policy is a question that can only be answered after examining the policy itself. It is not a matter that can ordinarily be resolved through a preliminary objection. 32.While the Respondent relied on authorities holding that Sections 5 and 10 principally relate to liabilities arising from death or bodily injury, the applicability of those provisions to the circumstances of this case could only properly be determined after the relevant evidence had been placed before the court. The issue was therefore not one that could be conclusively resolved at the threshold stage. 33.The Respondent further contended that the Appellant was a stranger to the contract of insurance, having not been a party to either the insurance policy or the proceedings leading to the issuance of the policy. According to the Respondent, the Appellant could only enforce rights strictly conferred by statute and therefore lacked any contractual basis upon which to maintain the declaratory suit. 34.While it is correct that the Appellant was not a party to the insurance contract, that fact alone could not dispose of the suit at the preliminary stage. The Appellant's claim was not founded on privity of contract but on the statutory right created under Section 10 of the Insurance (Motor Vehicles Third Party Risks) Act. Whether the Appellant fell within the category of persons entitled to invoke that statutory protection was a matter that could only be determined upon consideration of the evidence relating to the policy, the judgment obtained against the insured, the statutory notices allegedly served and the circumstances giving rise to the claim. 35.In APA Insurance Limited v Njenga (Civil Appeal E084 of 2023) [2024] KEHC 7002 (KLR), the Court considered a similar argument and observed that:In my view, the purpose of the above provisions and the Insurance (Motor Vehicle Third Party Risks) Act CAP 405 was to ensure that a third party who suffered injury or loss due to acts or omission on the part of an insured motor vehicle would be assured of compensation for their injury, loss or inconvenience in circumstances where the owner or driver of the insured motor vehicle has no means to settle the claim. 36.Consequently, the mere fact that the Appellant was not a party to the insurance contract could not, without more, defeat the suit. Indeed, the statutory framework under Cap. 405 contemplates circumstances under which a person who is not privy to the insurance contract may nonetheless pursue a declaratory claim against an insurer. Whether the Appellant satisfied the conditions necessary to invoke that statutory protection was a matter requiring evidentiary interrogation and could not properly be determined on a preliminary objection. 37.In the premise, I am persuaded that the Preliminary Objection dated 22 January 2024 did not raise a pure point of law and, therefore, fell short of the Mukisa Biscuit test. The trial court erred in upholding the objection and dismissing the Appellant's suit before the parties had been afforded an opportunity to tender evidence. D. Disposition 38.Consequently, the appeal succeeds and the Court makes the following orders:a.The appeal is hereby allowed;b.The ruling delivered on 24th May 2024 and all consequential orders arising therefrom in Mombasa CMCC No. E1532 of 2023 are hereby set aside.c.Mombasa CMCC No. E1532 of 2023, Moses Okal v APA Insurance Limited, is hereby reinstated and shall proceed to hearing and determination on its merits before the Chief Magistrate's Court at Mombasa.d.Each party shall bear its own costs of this appeal. 39.Orders accordingly. DELIVERED, DATED AND SIGNED AT NAIROBI THIS 20TH DAY OF JULY, 2026.NABIL M. ORINAJUDGEJudgment virtually delivered virtually in the presence of:Lenjo holding brief for Mr. Onyango for the RespondentLinda - Court Assistant