[2018] KEHC 1158 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYAAT NAIROBI

CIVIL APPEAL NO. 161 OF 2018

OBONYO WALTER ONEYA..............................................1ST APPELLANT

THE STANDARD NEWSPAPER GROUP LIMITED.....2ND APPELLANT

VERSUS

JACKLINE ANYANGO OGUDE[suing as the administrator of the estate of

Fredrick Odhiambo Sewe [deceased].........................................RESPONDENT

RULING

1. The application for determination before this court is the Notice of Motion dated 28th March 2018 in which the appellants/applicants seek orders of stay of execution of the judgment delivered by the lower court in Nairobi CMCC No. 7722 ‘A’ of 2012 on 27th February 2018 pending the disposal of their appeal.

2. The application is premised on grounds stated on its face and is supported by an affidavit sworn by Betty Isoe, the legal officer at ICEA Lion General Insurance Company Limited, the appellants’ insurers.

According to the deponent, the insurance company took up the defence of the suit in the lower court and instructed the law firm of Okongo, Wandago & Company Advocates to act for the appellants who were the defendants in the primary suit. They had been sued by the respondent in her capacity as the Administrator of the Estate of her late husband who had been involved in a fatal road accident which involved the 2nd appellant’s vehicle which was being driven by the 1st appellant.

3. The deponent further deposed that the insurance company had an interest in the appeal since it had a legal duty to satisfy the damages awarded to the respondent which in its view were manifestly excessive and not based on the evidence on record. It was further contended that if stay was not granted, the applicant would suffer substantial loss if execution proceeded since the respondent is a housewife who lives in Maringo Estate in Nairobi and will be unable to refund the decretal sums in the event that their appeal is successful.

4. The application is opposed. There is a replying affidavit sworn by the respondent on 2nd May 2018 in which she deponed that the affidavit supporting the motion is incompetent for want of capacity by the deponent; that the application ought to be dismissed as the appellants had promised to settle the decretal sums through letters written to her advocate soon after judgment was delivered and they should not be allowed to renege on their undertaking; that if the court was inclined to allow the application, it should be allowed on condition that the appellant pays the respondent half of the decretal amount and the remaining half to be deposited in an interest earning account operated by the advocates on record pending determination of the appeal.

5. By consent of the parties, the application was canvassed by way of written submissions. The appellants filed their written submissions on 21st June 2018 while those of the respondent were filed on 19th September 2018.

6. I have considered the application, the affidavits sworn in support and in opposition to the motion as well as the parties’ rival written submissions. In my view, two main issues arise for my determination which are as follows:

i) Whether the supporting affidavit is defective and incompetent for want of capacity by the deponent;

ii) Whether the applicants have satisfied the conditions precedent to grant of an order of stay pending appeal.

7. On the first issue, the respondent has argued that Betty Isoe is a stranger to the proceedings and did not have capacity to swear the affidavit as the insurance company was not a party to the primary suit and the appeal; that paragraphs 4, 5, 6 and 7 of the affidavit contravene Order 19 Rule 3 (1)of theCivil Procedure Rules as they contain facts which could not have been in the deponent’s personal knowledge.

8. The applicants did not file a further affidavit to respond to the averments in the replying affidavit nor did they file any submissions in reply. The attack on the competence of the supporting affidavit was thus not challenged by the applicants. Be that as it may, it is the court’s duty to interrogate the issues raised by the respondent to establish whether or not they are factual and whether the said affidavit is incurably defective.

9. As noted earlier, the supporting affidavit is sworn by Betty Isoe who described herself as:

“The legal officer at ICEA Lion General Insurance Company Limited who are the insurers of the appellants. I have the personal conduct of this matter and thus duly competent to swear this affidavit.”

It is not disputed that the deponent was indeed a legal officer working with the insurance company that had insured the motor vehicle that was involved in the fatal accident which was the subject matter of the primary suit.

10. Under Section 10of theInsurance (Motor Vehicles Third Party Risks) Act Cap 405, an insurance company which has issued a motor vehicle policy against 3rd party risks is under a mandatory legal duty to satisfy any judgment entered in favour of a 3rd party against the owner of the motor vehicle in question who is its insured – See: Thomas Muoka Muthoka & Another V Insurance Company of East Africa Limited, [2008] eKLR. Section 10 (2) of the same Act provides that the insurer will only be liable to satisfy the judgment entered against its insured if it was notified of the proceedings in which the judgment was delivered before or within 14 days of the commencement of the proceedings.

11. The fact that an insurer is required to be notified of the proceedings giving rise to the judgment and to satisfy the judgment obtained against its insured leaves no doubt that the insurer has an interest in the proceedings leading to the judgment and in any appeal against that judgment and consequently, it is my view that a legal officer or any authorised officer of the insurer would be seized of information pertaining to the proceedings in the primary suit and any appeal lodged against the decision or decree arising therefrom and has capacity to swear an affidavit in either the suit or the appeal. In any case, there is no law that provides that only co-litigants can swear affidavits in a matter. In my view, any person with information relevant to an action and who is duly authorized can swear an affidavit in the action.

12. The respondent has alleged in her submissions that Betty Isoe was not duly authorized to swear the supporting affidavit but no averment to that effect was made in her replying affidavit. Betty Isoe swore in the supporting affidavit that she was personally seized of the conduct of the matter on behalf of the insurer of the appellants. This averment amounted to evidence on oath which could only be controverted by other evidence to the contrary. The averment was not effectively challenged by the respondent since it was only raised in the respondent’s submissions but not in her replying affidavit.

13. It is therefore my finding that the respondent’s claim that the supporting affidavit is incompetent for want of capacity by the deponent is not well founded and cannot be sustained. It is thus my finding that the supporting affidavit is competent and is properly before the court.

14. The respondent invited the court to strike off some paragraphs in the supporting affidavit claiming that they contravened Order 19 Rule 3 (1)of theCivil Procedure Rules. This rule provides that:

“Affidavits shall be confined to such facts as the deponent is able of his own knowledge to prove:

Provided that in interlocutory proceedings, or by leave of the court, an affidavit may contain statements of information and belief showing the sources and grounds thereof.”

A perusal of the supporting affidavit reveals that the deponent in paragraphs 4, 5 and 6 deposed to matters related to the award of damages made to the respondent in the judgment which is being challenged on appeal. The deponent being the legal officer of the insurance company that had insured the appellant’s motor vehicle was expected to be privy to the information stated in the aforesaid paragraphs considering that the company had taken over the defence of the action and she had already been provided with a handwritten copy of the judgment delivered by the trial court which she annexed to the supporting affidavit. It is therefore my finding that no good basis has been laid to order the striking out of any of the aforesaid paragraphs.

15. In paragraph 7, the deponent has deposed that the respondent is a housewife who lives in Maringo Estate in Nairobi and she will be unable to refund the judgment sum if the same is paid. These are facts which are not expected to be in the deponent’s personal knowledge. The respondent’s occupation, status or what she did for a living was not stated in the pleadings in the suit or in the trial court’s judgment and consequently, the deponent ought to have disclosed the source of the information deposed in paragraph 7. She did not do so. I am therefore in agreement with the respondent’s submission that paragraph 7 of the supporting affidavit contravenes the provision of Order 19 Rule 3 (1)of theRules and it is for this reason struck out.

16. Having disposed of the preliminary objection to the competence of the supporting affidavit, I now turn to consider the merits of the application. I will start by considering whether the applicants have satisfied the conditions for grant of stay pending appeal as set out in Order 42 Rule 6of theRules. The conditions are that the applicants must demonstrate that if stay is denied, they will suffer substantial loss; that the application was made without unreasonable delay and that he had offered security for the due performance of the decree as the court may order.

17. In this case, I am satisfied that the applicants have satisfied the last two requirements of Order 42 Rule 6. I say so because the impugned judgment was delivered on 27th February 2018 and the application though dated 28th March 2018 was filed on 5th April 2018. The delay of about one and a half months is not unreasonable considering that the applicants had been granted 30 days stay of execution in the lower court. The applicants have also complied with the requirement regarding offer of security as it has been deponed in paragraph 8 of the supporting affidavit that they are ready and willing to provide security for the judgment as may be directed by the court.

18. On substantial loss, it is my finding that with the striking out of paragraph 7 of the supporting affidavit, there is no evidence placed before the court to demonstrate that the applicants will suffer substantial loss if stay is not granted. I am however mindful of the purpose for grant of stay pending appeal which is to safeguard the subject matter of the appeal so that an appellant’s right to appeal is safeguarded by ensuring that the appeal is not rendered nugatory.

19. In considering applications for stay pending appeal, the court must weigh and balance the competing interests of the parties because while the appellants’ have a right of appeal, the respondent being the successful litigant is also entitled to the fruits of her judgment.

20. It is important to note that the appellants do not contest the trial court’s finding on liability. They had been found 100% liable. The appeal only contests the quantum of damages particularly the damages awarded for loss of dependency. The record shows that the total decretal sum exclusive of party and party costs amounts to KShs.1,994,942.

Considering that the damages were awarded in a fatal accident claim, I hold the view that even if the appeal on quantum was successful, the award is unlikely to be reduced by more than half.

Balancing the interests of both parties, I find that the ends of justice will be served if I was to allow the application but on two conditions which I will set out shortly.

21. Consequently, I am satisfied that the application is merited and it is hereby allowed on the following terms;

i) The applicants shall pay the respondent half of the decretal amount exclusive of costs as stated hereinabove within 30 days of today’s date and deposit the other half in a joint interest earning account held jointly by the advocates on record within the same period of time.

ii) If the applicants fail to comply with any one of the two conditions above, the stay orders granted shall automatically lapse.

22. Costs of the application shall abide the outcome of the appeal.

It is so ordered.

DATED, DELIVERED andSIGNEDatNAIROBIthis 9th day of November, 2018.

C. W. GITHUA

JUDGE

In the presence of:

Mr. Odhiambo holding brief for Mr. Wangalwa for the respondent

No appearance for the appellant

Mr. Fidel: Court Assistant