https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/7716

UAP Old Mutual Group v Bhanji (Suing as the legal representative of the Estate of Sadrudin Esmail Bhanji) (Civil Appeal E1329 of 2024) [2026] KEHC 7716 (KLR) (Civ) (2 June 2026) (Judgment) Neutral citation: [2026] KEHC 7716 (KLR) Republic of Kenya In the High Court at Nairobi (Milimani Law Courts) Civil Civil Appeal E1329 of 2024 AN Ongeri, J June 2, 2026 Between Uap Old Mutual Group Appellant and Moyes Sadrudin Bhanji (Suing as the legal representative Of The Estate Of Sadrudin Esmail Bhanji) Respondent (Being an Appeal arising from the Judgment and decree of Hon C K Cheptoo (PM) delivered on 24th October 2024 in Milimani MCCC NO E9971 of 2021) Judgment 1.The Respondent, Moyez Sadrudin Bhanji, as legal representative of the estate of Sadrudin Esmail Bhanji (the Deceased), sued the Appellant, UAP Old Mutual Group, for breach of an insurance policy contract dated 4th December 2012. 2.The Respondent claimed that despite the policy providing an overall annual limit of Kshs 5,000,000 for inpatient treatment, the Appellant only paid Kshs 500,000 (the sub-limit for chronic conditions) after the Deceased was admitted to Aga Khan University Hospital with acute pneumonia and subsequently died. 3.The Respondent sought a declaration of breach and an order directing the Appellant to pay the outstanding hospital bill of Kshs 4,500,000, arguing the pneumonia was an acute condition unrelated to the Deceased's underlying chronic disorders from which the deceased suffered which included chronic kidney disease, hypertension and type 2 diabetes. 4.The Trial Court delivered a Judgment and Decree on 24th October 2024 in Milimani MCCC No. E9971 of 2021 and ruled that the Respondent had sufficiently proved a claim for Kshs 4,500,000. 5.The trial court also made a finding that the Appellant was in breach of the insurance policy and that the deceased died of pneumonia, a finding the Appellant contested. 6.The Appellant has now appealed that decision to the High Court, seeking to have the trial court's judgment set aside on the following grounds;i.That the trial magistrate erred in law in applying the general principle in Adrec Limited v Nation Media Group Limited [2017] eKLR while determining the application of the arbitration clause under the policy, hence failing to appreciate the primary issue for determination before Court.ii.That the trial magistrate erred in law and in fact in purporting to rewrite the contract inter parties and, in result, erred in failing to interpret and apply the law.iii.That the trial magistrate erred in law and in fact in holding that the deceased died of pneumonia, when such finding was not supported by evidence.iv.That the trial magistrate misapprehended and misapplied the evidence, misunderstood facts, overlooked facts, and/or misapprehended the policy limit in holding that the claim for Kshs 4,500,000.00 was supported by medical bills, when such finding was not supported by evidence.v.That the trial magistrate erred in law and in fact in holding that the Plaintiff sufficiently proved a claim for Kshs 4,500,000.00 and that the Defendant was in breach of the policy, when such finding was not supported by evidence, thereby arriving at a wrong finding.vi.That the trial magistrate misapprehended and misapplied the report by Kenya Medical Practitioners & Dentists Board (KMPDB).vii.That the trial magistrate erred in law and fact in predisposing her mind to a position favourable to the Respondent against the Appellant and thereby arrived at a wrong finding.viii.That the trial magistrate erred in law and in fact in failing to exercise judgment and consider all material factual and legal matters placed before court for determination through pleadings and submissions. 7.The parties filed written submissions as follows; The appellant submitted that the trial magistrate made multiple legal and factual errors. 8.First, the appellant contends that the court failed to enforce the insurance policy’s arbitration clause, which required any dispute to be referred to arbitration within twelve months of a disclaimer of liability. 9.Since the respondent did not invoke arbitration within that period, the appellant argues the claim was deemed abandoned and irrecoverable. 10.The trial court’s reliance on general arbitration principles from Adrec Limited v Nation Media Group Limited [2017] KECA 106 (KLR) was therefore misplaced. 11.Second, the appellant asserts that the trial court improperly rewrote the parties’ contract by allowing a claim brought nearly six years after the disclaimer, contrary to settled law that courts must enforce, not alter, clear contractual terms. 12.Third, the appellant challenges the finding that the deceased died of pneumonia, noting that no post-mortem report or direct evidence of cause of death was produced, and medical reports showed pneumonia had resolved after treatment. 13.Fourth, the appellant argues the award of Kshs 4,500,000 was unsupported by evidence, as no final medical bill or invoice for that amount was tendered, and the only invoice post-dated the deceased’s death. 14.The Kenya Medical Practitioners & Dentists Board report was not a treating facility and lacked authority to determine insurance liability. 15.Fifth, the appellant claims the trial magistrate ignored key evidence, including reports showing pneumonia resolved and emails suggesting the respondent attempted to influence a doctor’s opinion. 16.Overall, the appellant prays that the appellate court sets aside the trial judgment and award costs to the appellant. 17.The Respondent on his part submitted that the trial court correctly assumed jurisdiction because the arbitration clause in the insurance policy, which purportedly bars court action unless arbitration is sought within twelve months, is illegal and unenforceable. 18.The Respondent submits that this clause improperly denies an injured party access to civil remedies and that the Respondent made numerous efforts to resolve the dispute before approaching the court, meaning he did not sit on his rights. 19.On the merits, the Respondent asserts that the trial court properly found that the deceased died from an acute medical condition (pneumonia), not a chronic one, and that the hospital bill exceeded Kshs. 6 million. 20.Since the policy provided a cover limit of Kshs. 5 million for acute conditions, and the Appellant had already paid only Kshs. 500,000 for chronic conditions, the Respondent proved his case for the balance of Kshs. 4,500,000. 21.The Respondent therefore prays that the appeal be dismissed with costs to the Respondent for both the appeal and the lower court case. 22.The issues for determination in this appeal are as follows;i.Whether the trial court erred by assuming jurisdiction despite the arbitration clause,ii.Whether the finding on the cause of death was supported by evidence, andiii.Whether the quantum of Kshs 4,500,000 was adequately proved. 23.Regarding the arbitration clause, the Appellant’s contention that the dispute should have been referred to arbitration within twelve months of disclaimer is unenforceable because such a clause cannot operate to deny a party access to justice. 24.Where an arbitration clause is ambiguous or operates unfairly, the court may intervene to ensure the insured is not deprived of their right to litigate 25.. The trial court’s reliance on Adrec Limited v Nation Media Group Limited (supra) was proper, as that case established that an arbitration clause does not automatically oust the court’s jurisdiction where its application would be unjust or where the clause is inoperative. 26.Further, the Respondent’s multiple efforts to resolve the dispute before filing suit demonstrate that he did not sit on his rights, and the arbitration clause cannot be used as a technical shield to defeat a legitimate claim. 27.On the merits of the appeal, the trial court’s finding that the deceased died of acute pneumonia, not a direct consequence of his chronic conditions, is supported by the medical evidence on record. 28.The absence of a post-mortem report is not fatal, as the clinical records from the Aga Khan University Hospital and the report from the Kenya Medical Practitioners & Dentists Board sufficiently established pneumonia as the immediate cause of death. 29.The trial court correctly distinguished between an acute supervening illness and the underlying chronic disorders. 30.Regarding quantum, the trial court properly awarded Kshs 4,500,000 because the policy provided an annual inpatient limit of Kshs 5,000,000, and after the Appellant paid Kshs 500,000 under the chronic conditions sub-limit, the Respondent proved the outstanding hospital bill through documentary evidence. 31.The fact that the final invoice was issued after the deceased’s death does not invalidate the claim, as medical expenses were necessarily incurred during the admission. 32.The Appellant’s attempt to rewrite the policy to cap all payments at Kshs 500,000 fails because the pneumonia was an acute event, and the policy’s chronic sub-limit does not apply. 33.Consequently, the trial court’s judgment of 24th October 2024 in Milimani MCCC No. E9971 of 2021 is upheld, and the appeal is dismissed with costs to the Respondent for both the appeal and the lower court case. 34.Orders to issue accordingly. DATED, SIGNED AND DELIVERED AT NAIROBI THIS 2ND DAY OF JUNE 2026ASENATH ONGERIJUDGEIn the presence ofMiss Wangui for the AppellantMr Sundwa for the RespondentChrispine - Court Assistant