Musoni Kenya Ltd v OKI (Suing as the next friend of PIK - Minor) & 2 others (Civil Appeal E939 of 2024) [2026] KEHC 10120 (KLR) (Civ) (3 July 2026) (Judgment)

Musoni Kenya Ltd v OKI (Suing as the next friend of PIK - Minor) & 2 others (Civil Appeal E939 of 2024) [2026] KEHC 10120 (KLR) (Civ) (3 July 2026) (Judgment) Neutral citation: [2026] KEHC 10120 (KLR) Republic of Kenya In the High Court at Nairobi (Milimani Law Courts) Civil Civil Appeal E939 of 2024 RA Oganyo, J July 3, 2026 Between Musoni Kenya Limited Appellant and OKI (Suing as the next friend of PIK - Minor) 1st Respondent Dickens Ongeno Nyaboke 2nd Respondent Samuel Ogamba Basweti 3rd Respondent (Being an appeal from a Ruling on Application dated 20th March 2023 of Hon. B. Kabanga (SRM) of the Milimani Magistrate Court delivered on the 7th day of August 2024 in Civil Case Number E3750 of 2022) Judgment 1.This dispute arises from the ruling of the learned magistrate, Hon. B. Kabanga (Senior Resident magistrate) delivered on 7th August 2024 in Civil Case number E3750 of 2022. The genesis of the underlying dispute stems from a road traffic accident that occurred on the 25th day of February 2019, where the plaintiff’s son (now the 1st Respondent) was lawfully walking as a pedestrian along Nile Road when the 1st defendant (now the 2nd Respondent) controlled the Motor Vehicle Registration Number KBP 313Q negligently thereof causing it to hit the minor. 2.By a Plaint dated 12th April 2022, The Plaintiff (now the 1st Respondent) further pleaded that the 1st defendant (now the 2nd Respondent) was the driver of Motor Vehicle Registration Number KBP 313Q while 2nd Defendant (now the Appellant) and 3rd Defendant (now the 3rd Respondent) were the registered owners of the said motor vehicle and were consequently vicariously liable for the acts and omissions of the 1st Defendant. 3.The Plaintiff averred that the accident was wholly and/or substantially caused by the negligence of the 1st Defendant, who drove the motor vehicle at an excessive speed in the circumstances, failed to keep any proper lookout for other road users, failed to maintain proper control of the motor vehicle, failed to stop, slow down, swerve or otherwise avoid knocking down the minor, drove on the wrong side of the road, and thereby caused the accident. 4.As a consequence of the accident, the minor sustained a mild head injury, loss of consciousness, parietal extradural haematoma, and convulsions. The Plaintiff pleaded that the minor suffered loss and damage as a result of the injuries sustained and claimed special damages of Kshs. 38,960/=, together with general damages, costs of the suit, and interest. The Plaintiff further averred that despite demand and notice of intention to sue, the Defendants had failed, refused and/or neglected to admit liability or compensate the Plaintiff. 5.The 2nd Defendant opposed the suit through a Statement of Defence dated 20th March 2023 in which it admitted the descriptive particulars of the parties and the jurisdiction of the Court but denied each and every material allegation contained in the Plaint and put the Plaintiff to strict proof thereof. The 2nd Defendant specifically denied the particulars of injuries and special damages pleaded by the Plaintiff, denied receipt of any demand letter, and contended that no demand had been served upon it. The 2nd Defendant further maintained that the suit was misconceived, unfounded, devoid of merit, frivolous, vexatious and scandalous, and prayed that the Plaintiff's suit be dismissed with costs. 6.The 2nd Defendant (now the Appellant,) produced a loan offer letter dated 11th December 2017 showing that it had advanced the 3rd Defendant ( now the 3rd Respondent), Samuel Ogamba Basweti, a loan facility of Kshs. 1,034,264 for working capital. The facility was secured, inter alia, by Motor Vehicle Registration Number KBP 313Q together with personal guarantees, and the agreement provided that the borrower would not dispose of or otherwise deal with the motor vehicle while the loan remained outstanding. The loan offer further contained provisions on interest, charges, insurance, the borrower's obligations, the lender's rights upon default, and the sharing of the borrower's credit information with licensed Credit Reference Bureaus, and was governed by the laws of Kenya. 7.The Appellant produced a loan statement showing that the 3rd Respondent was advanced a loan of KSh 1,034,264.00 at an interest rate of 20% per annum. The statement reflects repayments made between 29th December 2017 and 6th January 2021, with the principal balance reducing to nil upon the final repayment. It further shows that interest, together with other charges where applicable, was levied over the repayment period, culminating in the full settlement of the loan as reflected in the statement. 8.The Appellant filed an application dated 20th March 2023, seeking to be struck out of the suit on the ground that it was merely a financier of Motor Vehicle Registration Number KBP 313Q and neither had possession nor control of the vehicle at the material time. It contended that its joint registration as owner was solely to secure its financial interest under the loan agreement, that it was neither the beneficial owner nor the insurer of the motor vehicle, and that it discharged its interest upon repayment of the loan by the 3rd Respondent. The Appellant therefore maintained that it had been improperly joined to the proceedings and prayed that its name be struck out from the suit with costs. 9.The 1st Respondent opposed the Appellant’s application through Grounds of Opposition dated 5th May 2023, contending that the application was frivolous, misconceived and an abuse of the court process. The 1st Respondent maintained that at the time of the accident, the Appellant was a registered co-owner of Motor Vehicle Registration Number KBP 313Q and retained a legal interest in the vehicle by virtue of the loan agreement, which entitled it to repossess the motor vehicle in the event of default. The 1st Respondent further argued that the issue of the Appellant liability could only be determined upon a full hearing, that the subsequent transfer of ownership was irrelevant and allegedly intended to defeat the 1st Respondent’s claim, and that the 2023 copy of records relied upon by the Appellant was inadmissible and did not reflect ownership at the material time. The 1st Respondent therefore contended that allowing the application would occasion prejudice to the 1st Respondent, while no prejudice would be suffered by the Appellant if it remained a party to the suit. 10.Upon considering the Notice of Motion, the supporting affidavit, the response thereto, and the parties' submissions, the learned trial magistrate found that the issue of the Appellant culpability was a triable issue that could not be determined without hearing evidence at the trial. 11.The learned magistrate expressed himself as follows:“Considering that striking out is a draconian act that should be resorted to in very rare and clear cases and which must be exercised both sparingly and judiciously, I am of the considered view that the ends of justice in this matter will be met by disallowing the application at this stage to pave way for trial. Accordingly, costs of the application shall abide the outcome of the suit.” 12.Guided by the foregoing reasoning, the trial court declined to strike out the Appellant from the proceedings, holding that the question of its liability could only be determined after the parties had adduced evidence at the hearing. Consequently, the application dated 20th March 2023 was dismissed, with costs ordered to abide the outcome of the main suit. Aggrieved by the said decision, the 2nd Defendant (now the Appellant) lodged the present appeal. 13.The Appellant’s case is anchored on seven primary grounds articulated in the Memorandum of Appeal dated 13th August 2024 and amplified in the written submissions dated 25th July 2025. These are as follows: -i.That the Learned Trial Magistrate gravely erred in fact and in law by failing to strike out the Appellant's name from the suit.ii.That the Learned Trial Magistrate gravely erred in fact and in law by failing to consider and appreciate the contents of the Appellant's Application and making a finding that there are triable issues to be determined through trial of the suit.iii.That the Learned Trial Magistrate particularly failed to consider the Statement of Accounts annexed to the Application showing that at the time of the accident the 2nd and 3rd Defendants had fully paid up their loans and therefore Clause 11 of the Loan Agreement allowing it to recover the motor vehicle could not and was not activated. The Trial Magistrate failed to appreciate the evidence on record that the vehicle had not been repossessed by the Appellant and thus there was no right or relief that could bear upon it or any triable issues that remained for it to answer.iv.That the Learned Trial Magistrate erred in fact and in law in failing to find that the Appellant had rebutted the presumption of ownership of the motor vehicle in question at the alleged time of the accident.v.That the Learned Trial Magistrate erred in law in failing to consider or consider the submissions made by the Applicant/Appellant herein hence arriving at unjust decision in the Ruling.vi.That the Learned Trial Magistrate erred in fact and in law by failing to sufficiently consider on record the merits or otherwise of the application giving rise to the impugned ruling and order.vii.That the Learned Trial Magistrate erred in fact and in law by failing to consider that from the evidence on record, the Applicant was only a mere financier and thus ought to have been struck out from the suit. 14.Consequently, the Appellant prays that this Court be pleased to allow the appeal; set aside the ruling and all consequential orders delivered by Hon. B. Kabanga (SRM) on 7th August 2024; allow the Appellant's Notice of Motion dated 20th March 2023 by striking out the name of the 2nd Defendant from the suit before the trial court; and award the Appellant the costs of the appeal and the proceedings before the trial court. 15.The 1st Respondent opposed the appeal, contending that the learned trial magistrate properly exercised his discretion in declining to strike out the Appellant from the suit, as the question of the Appellant's liability was a triable issue that could only be determined upon a full hearing. The 1st Respondent further maintained that the Appellant was a registered owner of the motor vehicle at the material time, that its arguments regarding its status as a financier could only be determined through evidence at trial, and that the appeal was frivolous, an abuse of the court process, and intended to delay or defeat the fair determination of the suit. Appellant’s Submissions 16.The Appellant submits that the learned trial magistrate erred in both law and fact by declining to strike it out from the proceedings despite the uncontroverted documentary evidence demonstrating that it was merely a financier of Motor Vehicle Registration Number KBP 313Q and neither exercised possession, control, nor operational authority over the vehicle at the material time. It argues that the joint registration of the motor vehicle was solely intended to secure its financial interest under the Loan Agreement dated 11th December 2017 and did not confer beneficial ownership capable of attracting liability in negligence. The Appellant further contends that the statement of account produced before the trial court established that the loan had been fully repaid before the accident, with the consequence that its contractual right of repossession under Clause 11 of the Loan Agreement had never crystallized. It therefore faults the trial court for finding that triable issues existed despite what it terms as uncontested documentary evidence and places reliance on Consolidated Bank of Kenya Limited v Mwangi & another [2022] KEHC 3104 (KLR), National Industrial Credit Bank Ltd v Felister Mwende Musyimi & another [2016] eKLR, and Charles Nyabuto Mageto v Peter Njuguna Njathi [2013] eKLR to argue that the statutory presumption of ownership under Section 8 of the Traffic Act is rebuttable and that beneficial ownership may be disproved through documentary evidence. 17.On the issue of vicarious liability, the Appellant submits that liability cannot arise merely from joint registration of a motor vehicle but must be founded upon proof of an employer-employee or principal-agent relationship involving control or delegation of duties to the driver. It argues that the 2nd Respondent was neither its servant nor agent and was not acting under its instructions at the time of the accident, with the result that no vicarious liability could attach to it. In support of this proposition, the Appellant relies on Juhudi Kilimo Company Limited v Amwayi & another (Suing as the legal representatives of the Estate of Grace Khasandi) & another [2024] KEHC 5333 (KLR), Jane Wairimu Turanta v Githae John Vickery & Others, John Nderi Wamugi v Ruhesh Okumu Otiangala, and Consolidated Bank of Kenya Limited v Mwangi & another [2022] KEHC 3104 (KLR), all of which affirm that a financier's joint registration of a motor vehicle for purposes of securing a loan does not, without more, render it vicariously liable for the negligence of the driver. The Appellant therefore urges this Court to allow the appeal, set aside the impugned ruling, strike out its name from the proceedings, and award it the costs of both the appeal and the proceedings before the trial court. 1st Respondent’s Submissions 18.The 1st Respondent opposes the appeal and urges this Court to uphold the ruling of the learned trial magistrate, submitting that the Appellant was properly joined to the suit as a joint registered owner of Motor Vehicle Registration Number KBP 313Q at the material time. The Respondent contends that the claim is anchored on the official copy of motor vehicle records, which identifies the Appellant as a joint registered owner, and that the records do not indicate that the Appellant's registration was merely in its capacity as a financier. Placing reliance on Section 8 of the Traffic Act, the Respondent submits that the law presumes the registered owner of a motor vehicle to be its owner unless the contrary is proved, and therefore the Appellant's registration furnished a sustainable cause of action against it. The Respondent further argues that the inclusion of both registered owners was necessary for the comprehensive determination of the issues raised in the plaint and that the learned trial magistrate correctly held that the question of the Appellant's culpability constituted a triable issue that could only be determined upon hearing evidence at the trial. 19.The 1st Respondent submits that the Appellant's reliance on the copy of records dated 20th March 2023 is misconceived since ownership after the accident is irrelevant to the issues arising from the accident of 25th February 2019, when the Appellant remained a registered owner of the motor vehicle. It is argued that the subsequent transfer of ownership to Charles Maina Mwangi, who is a stranger to the proceedings, cannot defeat an accrued cause of action, and that the Court ought to take judicial notice that ownership of motor vehicles frequently changes over time. The Respondent further contends that the later copy of records is inadmissible by virtue of Section 5 of the Evidence Act as it relates to matters not in issue, and maintains that the Appellant would suffer no prejudice by remaining in the suit since its liability or otherwise can only be conclusively determined after a full hearing. Accordingly, the Respondent prays that the appeal be dismissed with costs. Issues for Determination 20.Having carefully considered the Record of Appeal, the pleadings, and the submissions filed by the parties, this Honourable Court is of the view that the following issue arises as the main issue for determination:i.Whether the learned trial magistrate erred in law and in fact in declining to strike out the Appellant (the 2nd Defendant) from the suit. Analysis and Determination 21.This being a first appellate court, it was held in Selle vs. Associated Motor Boat Co. [1968] EA 123 that:“The appellate court is not bound necessarily to accept the findings of fact by the court below. An appeal to the Court of Appeal from a trial by the High Court is by way of a retrial and the principles upon which the Court of Appeal acts are that the court must reconsider the evidence, evaluate it itself and draw its own conclusions though it should always bear in mind that it has neither seen nor heard the witnesses and should make due allowance in this respect. In particular the court is not bound necessarily to follow the trial Judge’s findings of fact if it appears either that he has clearly failed on some point to take account of particular circumstances or probabilities materially to estimate the evidence or if the impression based on the demeanour of a witness is inconsistent with the evidence in the case generally.” 22.Turning to the main issue of determination, namely Whether the learned trial magistrate erred in law and in fact in declining to strike out the Appellant (the 2nd Defendant) from the suit. 23.The Appellant sought to be struck out from the proceedings on the ground that it was merely a financier of Motor Vehicle Registration Number KBP 313Q and that its joint registration with the 3rd Respondent was solely intended to secure its financial interest under the loan facility. The Appellant contends that it neither exercised possession nor control over the motor vehicle at the material time and that the loan had been fully repaid, thereby extinguishing any contractual right of repossession under Clause 11 of the Loan Agreement. Consequently, it maintains that it was improperly joined to the suit and that no cause of action lies against it. 24.Conversely, the 1st Respondent submits that the Appellant remained a joint registered owner of the motor vehicle at the time of the accident and that, by virtue of Section 8 of the Traffic Act, it is deemed to be the owner unless the contrary is proved. The 1st Respondent further argues that the Appellant's status as a financier and whether such status is sufficient to absolve it from liability are matters that can only be determined upon a full hearing after the parties have adduced evidence. 25.Order 1 Rule 10(2) of the Civil Procedure Rules provides that: “The court may at any stage of the proceedings, either upon or without the application of either party, and on such terms as may appear to the court to be just, order that the name of any party improperly joined, whether as plaintiff or defendant, be struck out, and that the name of any person who ought to have been joined, whether as plaintiff or defendant, or whose presence before the court may be necessary in order to enable the court effectually and completely to adjudicate upon and settle all questions involved in the suit, be added.” 26.The scope of the Court's discretion under Order 1 Rule 10(2) of the Civil Procedure Rules has received considerable judicial interpretation. In JMK v MWM & Another [2015] eKLR, the Court of Appeal observed that the provision empowers the Court, at any stage of the proceedings, either upon application or suo motu, to strike out a party who has been improperly joined or to retain a party whose presence is necessary to enable the Court to effectually and completely adjudicate upon and settle all the questions involved in the suit. 27.Similarly, in Werrot & Company Ltd & Others v Andrew Douglas Gregory & Others [1998] eKLR, the Court held that, in determining whether a party is a necessary party, two conditions must be satisfied. First, there must exist a right to some relief against such a party in respect of the matter in controversy. Secondly, it must be impossible to pass an effective and complete decree in that party's absence. Likewise, in Pizza Harvest Limited v Felix Midigo [2013] eKLR, while adopting the decision in Amon v Raphael Tuck & Sons Ltd (1956) 1 All ER 273, the Court reiterated that a person is not a necessary party merely because he possesses relevant evidence or has an interest in the outcome of the proceedings. Rather, a party is necessary only where the issues in controversy cannot be effectually and completely determined unless that person is before the Court and is bound by the eventual decision. 28.From the foregoing authorities, it is evident that an applicant seeking to be struck out bears the burden of demonstrating that no sustainable cause of action exists against it, no effective relief is sought against it, and that its continued participation is unnecessary for the effectual and complete determination of the dispute. 29.Equally settled is the principle that the power to strike out pleadings or remove a party from proceedings is a draconian remedy which ought to be exercised sparingly and only in the clearest of cases. In Uchumi Supermarkets Limited & Another v Sidhi Investments Limited [2019] eKLR, the Court of Appeal reiterated that striking out is a remedy of last resort and should only be invoked where the circumstances plainly justify such intervention. Likewise, in Co-operative Merchant Bank Ltd v George Fredrick Wekesa, Civil Appeal No. 54 of 1999, as cited with approval in Jubilee Insurance Co. Ltd v Grace Anyona Mbinda [2016] eKLR, the Court held that striking out is a draconian act which may only be resorted to in plain and obvious cases where the pleadings disclose no semblance of a reasonable cause of action or defence and are incapable of being cured by amendment. 30.The same caution was expressed by Madan JA in D.T. Dobie & Company (Kenya) Ltd v Muchina [1982] eKLR, where the Court observed that the jurisdiction to strike out should be exercised with extreme care and only where the suit is so hopeless that it plainly discloses no reasonable cause of action and is beyond redemption. The Court further emphasized that courts should endeavour to sustain rather than summarily terminate litigation and should avoid conducting a mini-trial at the interlocutory stage. 31.Similarly, in Evanson Jidraph Kamau Waitiki v Kenya Power & Lighting Company Ltd [2017] KECA 526 (KLR), the Court of Appeal reiterated that an application for striking out does not invite the Court to determine contested issues of fact or embark upon a mini-trial. Where material facts remain disputed and require evidentiary interrogation, such disputes ought properly to be resolved at the substantive hearing. Further, in Trust Bank Limited v Amin Company Ltd & Another (2000) KLR 164, the Court held that a pleading should not be regarded as frivolous, vexatious or an abuse of the process of the Court unless it is plainly groundless, hopeless and incapable of succeeding. 32.Turning to the question of ownership, Section 8 of the Traffic Act provides that the person in whose name a motor vehicle is registered shall, unless the contrary is proved, be deemed to be its owner. In Francis Nzioka Ngao v Silas Thiani Nkunga, Civil Appeal No. 92 of 1998, the Court of Appeal held that the statutory presumption of ownership is rebuttable and that whether ownership has effectively passed from one person to another is a question of fact to be determined on the evidence presented in each particular case. The Court further observed that a registered owner who transfers ownership bears the statutory obligation of notifying the Registrar of Motor Vehicles within the prescribed period. 33.I have also considered the authorities relied upon by the Appellant, particularly Consolidated Bank of Kenya Limited v Mwangi & Another [2022] KEHC 3104 (KLR), National Industrial Credit Bank Ltd v Felister Mwende Musyimi & Another [2016] eKLR, and Juhudi Kilimo Company Limited v Amwayi & Another (Suing as the Legal Representatives of the Estate of Grace Khasandi) & Another [2024] KEHC 5333 (KLR). Those decisions recognize that a financier who merely holds a security interest in a motor vehicle, without possession, control, or any employer-employee or principal-agent relationship with the driver, may not be held vicariously liable for the negligent use of the motor vehicle. They further affirm that the statutory presumption of ownership under Section 8 of the Traffic Act is rebuttable by cogent evidence demonstrating that the registered owner was merely a financier. 34.Those authorities are distinguishable from the present appeal. In those cases, the courts were satisfied, on the material placed before them, that the financiers had successfully rebutted the statutory presumption of ownership and demonstrated that no sustainable basis for imposing liability existed. In the present matter, however, this Court is considering an interlocutory application in which the parties' competing positions have not yet been tested through oral evidence and cross-examination. 35.Applying those principles to the present case, The Appellant contends that its registration was solely intended to secure the loan facility advanced to the 3rd Respondent; that it neither exercised possession nor control over the motor vehicle; that it was not the beneficial owner thereof; and that the loan had been fully repaid before the accident, thereby extinguishing any contractual right of repossession under Clause 11 of the Loan Agreement. Conversely, the 1st Respondent maintains that the Appellant's registration as a joint owner furnished a valid cause of action against it and that whether its status as a financier absolves it from liability is a matter that can only be determined upon a full hearing. 36.In my considered view, the issues raised by the parties are not capable of determination solely on affidavit evidence. Although the Appellant has placed reliance on the Loan Agreement and the statement of account in an attempt to rebut the presumption of ownership created under Section 8 of the Traffic Act, whether those documents are sufficient to displace that presumption remains a contested question of fact. Equally, whether the Appellant's registration was merely as security for the loan facility, whether the loan had indeed been fully discharged before the occurrence of the accident, whether the Appellant retained any legal or beneficial interest in the motor vehicle at the material time, and whether such interest is capable of attracting vicarious liability are matters that require the Court to evaluate the totality of the evidence. 37.At this interlocutory stage, the Court is not called upon to determine whether the Appellant will ultimately be found liable. Rather, the question is whether the material presently before the Court conclusively establishes that the Appellant bears no legal responsibility whatsoever. To make such a determination at this stage would inevitably amount to conducting the very mini-trial against which the authorities have consistently cautioned. 38.In the circumstances, I find that the learned trial magistrate properly concluded that the Appellant's liability raises triable issues requiring determination at a full hearing. The Appellant's status as a joint registered owner, viewed alongside its assertion that it was merely a financier, raises contested questions of fact that can only be conclusively resolved upon a full evaluation of the evidence at trial. 39.Accordingly, I am not persuaded that this is one of those plain and obvious cases warranting the draconian remedy of striking out. I find that the learned trial magistrate properly exercised his discretion in declining to strike out the Appellant from the proceedings. I discern no error of principle, misdirection or improper exercise of discretion that would justify interference by this Court. Disposition 40.In light of the foregoing analysis and findings, this Court makes the following orders:i.I find no basis upon which this Court can interfere with the exercise of discretion by the learned trial magistrate. The appeal therefore lacks merit.ii.Consequently, the appeal is hereby dismissed in its entirety. The ruling of Hon. B. Kabanga (SRM) delivered on 7th August 2024 in Milimani CMCC No. E3750 of 2022 is hereby upheld.iii.The costs of this appeal shall be borne by the Appellant.Orders Accordingly.Right of appeal 30 days. DATED, SIGNED AND DELIVERED VIA TEAMS AT NAIROBI THIS 3RD DAY OF JULY, 2026.………………………..HON. R. A. OGANYOJUDGE.In the presence of: -Court Assistant…...Sana, E.Mr. Ajwang’ h/b for Kiragu Wathuta for the AppellantN/A for the Respondent.