Jubilee Insurance Company Limited v Bichanga [2022] KEHC 13915 (KLR)

Jubilee Insurance Company Limited v Bichanga (Civil Appeal 2 of 2017) [2022] KEHC 13915 (KLR) (19 October 2022) (Judgment)

Neutral citation: [2022] KEHC 13915 (KLR)

Republic of Kenya

In the High Court at Bomet

Civil Appeal 2 of 2017

RL Korir, J

October 19, 2022

Between

Jubilee Insurance Company Limited

Appellant

and

Denvins Bichanga

Respondent

(Being an Appeal from the Ruling of Hon. G. Kiage Resident Magistrate in Civil Suit Number 70 of 2016 - Bomet delivered on 21st December 2016)

Judgment

1. The Respondent herein, Denvins Bichanga had filed a Declaratory Suit, Bomet PMCC No. 70 of 2016 against the Appellant, Jubilee Insurance Company seeking a Declaration that the Appellant was bound to settle the Decree and Costs and all other incidental costs that arose from Bomet PMCC NO. 182 OF 2010.

2. The Appellant herein filed a Notice of Motion Application dated 13th August 2016 seeking stay of proceedings in Bomet PMCC NO. 70 OF 2016 pending the hearing and determination of Kericho Hccc No. 103 Of 2011 Jubilee Insurance Company Limited Vs Daniel Oriwa Oguda.

3. In the Ruling dated 21st December 2016, the trial court dismissed the Application stating that the Appellant had not justified the grant of the orders for stay of proceedings. Thereafter the Appellant filed an Application dated 16th January 2017 that sought stay of proceedings in Bomet PMCC NO. 70 of 2016 pending the hearing and determination of this Appeal. The stay order was granted on condition that the Appellant deposited the Decretal sum in an interest bearing account in a reputable bank in the joint names of the counsels for the Appellant and Respondent.

4. Being aggrieved by the decision of the trial court, the Appellant appealed against the Ruling delivered on 21st December 2016 on the following grounds:-(i)The learned Trial Magistrate erred in law and in fact in holding that the declaratory suit was filed after the determination of the primary suit and that therefore the application could not stay what had been determined whereas the declaratory suit had been filed on 4/11/2011 while judgments in the primary suit was delivered on 18/2/2013. (ii)The learned Trial Magistrate erred in law and in fact in failing to appreciate that the application dated 13/08/16 sought to stay proceedings in the declaratory suit filed by the plaintiff and not the judgment and decree obtained in the primary suit.(iii)The learned Trial Magistrate erred in law and in fact in failing to appreciate that in disallowing the application dated 13/08/16, the appellant would be liable to settle damages in the primary suit despite it having filed a suit filed (Kericho HCCC No. 103 OF 2011) seeking a declaration that it is entitled to avoid the policy thus occasioning a failure of justice.(iv)The learned Trial Magistrate grossly misdirected himself in treating the grounds and submissions and the law pertaining thereto before him superficially and consequently came to a wrong conclusion on the same.(v)The learned Trial Magistrate misdirected himself in ignoring the written submissions presented and filed by the Appellant in its entirety.

The Appellant’s Case. 5. Through a Supporting Affidavit sworn by Collins Nyaema, the Appellant stated that it entered into an Insurance Contract, Policy Number P/NRB/2010/2010/50894 with Daniel Orawa Aguda(hereinafter referred to as the insured) in respect to Motor Vehicle Registration Number KAZ 582S. That on 13th October 2010, the said Motor Vehicle was involved in an accident and as a result the Respondent herein filed a suit being Bomet PMCC NO. 182 OF 2010 against the insured seeking damages. It was the Appellant’s case that the Respondent obtained Judgment on 18th February 2013.

6. The Appellant stated that the Respondent filed a Declaratory Suit (bomet PMCC NO. 70 OF 2016) that bound the Appellant to settle the Judgment obtained on 18th February 2013.

7. It was the Appellant’s case that it had filed a Declaratory Suit on 4th November 2011 being Kericho Hccc No. 103 Of 2011 Jubillee Insurance Company Limited v Daniel Oriwa Aguda. That it sought a Declaration that it was not bound to satisfy the policy to the insured due to a breach of terms, conditions and warranties.

8. The Appellant stated that if the Declaratory Suit (Bomet PMCC 70 OF 2016) proceeded for hearing and was determined before the hearing and determination of the other Declaratory Suit (Kericho HCCC NO. 103 OF 2011) then it would be adversely affected as it would be liable to settle any damages awarded in the parent suit hence making the Declaratory Suit in Kericho nugatory. That it would be in the interest of justice to stay the proceedings in Bomet PMCC 70 OF 2016 pending the hearing and determination of Kericho HCCC NO. 103 OF 2011.

The Applicant’s Submissions. 9. The Appellant submitted that it filed the Declaratory Suit in Kericho to get a Declaration that it was not bound to settle any damages arising from the accident of their insured’s vehicle Registration Number KAZ 582S. That their insured breached the terms of the insurance policy by allowing his motor vehicle to be used for the purpose of carrying fare paying passengers and was also being used for hire and reward.

10. It was the Appellant’s submission that it expeditiously filed the Declaratory Suit in 2011 before the Judgment in the primary suit Bomet PMCC NO. 182 OF 2010 which was delivered on 18th February 2013. It relied on Sections 1A, 1B, 3A and 6 of the Civil Procedure Act

11. The Appellant submitted that according to Section 6 of the Civil Procedure Act, it had proved the existence of another suit with the related subject matter to Bomet PMCC 70 OF 2016. That the Plaintiff in Kericho HCCC NO. 103 OF 2011 was the insurer of the Defendant in the primary suit Bomet PMCC 182 OF 2010 who was found liable in the said claim. That it was therefore necessary that there be a stay of proceedings in Bomet PMCC 70 OF 2016 until the contractual relationship between it and its insured was determined. It relied on the case of Jadva Karsan vs Harnam Singh Bhogal 1952 EACA 74 to support its submission.

12. It was the Appellant’s submission that the Declaratory Suit in Kericho was filed much earlier than Bomet PMCC 70 OF 2016. That the Respondent should have waited for the outcome of the Kericho suit before commencing on his Declaratory Suit in Bomet. It relied on the case of Jubilee Insurance Company Limited v Penninah Mwongeli Musili [2016] eKLR to support its submission.

Respondent’s Submissions. 13. The Respondent submitted that the primary suit was defended by the Appellant. That during the pendency of the primary suit, the Appellant did not seek stay orders to disown the policy they issued to their insured. It was his further submission that the Appellant was duty bound to stay the primary suit so that the issue of their insured’s policy would be determined at that stage.

14. It was the Respondent’s submission that the Appellant has not stated what became of their Declaratory Suit in Kericho, Kericho HCCC NO. 103 OF 2011. That the Appellant did not seek stay orders in the Kericho suit. It was his further submission that the Appellant slept on his rights and only woke up when the Respondent’s filed their Declaratory Suit.

15. The Respondent submitted that the conduct and behaviour of the Appellant demonstrated their unwillingness of prosecuting the present Appeal. That the Appellant was using this court to the disadvantage of the Respondent. It was his further submission that the Appellant got stay orders in 2017 and has been content to the extent of not prosecuting this Appeal.

16. I have read through and considered the Record of Appeal dated 18th November 2020, the Appellant’s Written Submissions dated 26th June 2022, and the Respondent’s Written Submissions dated 1st August 2022 and the only issue for my determination is whether the Applicant should be granted the order for stay of proceedings in Bomet PMCC No. 70 of 2016.

17. I have noted that this Appeal is similar to another Appeal before this court i.e. High Court Civil Appeal Number 1 of 2017 – Jubilee Insurance Company Limited vs Jared Ombuna. I have also noted that the Ruling that is the subject of this Appeal is similar to the Ruling that was the subject of the aforementioned Appeal.

18. The Primary Suits, Declaratory Suits, Written Submissions and Authorities relied upon in the two Appeals are similar. The only difference between the two Appeals is the Respondent. It appears that they passengers in the same car KAZ 582S involved in an alleged accident on 30th October 2010. I will therefore adopt a similar approach with similar reasoning as in the aforementioned Bomet Civil Appeal Number 1 of 2017.

19. In approaching this Appeal, I am persuaded by the case of Kenya Wildlife Service vs. James Mutembei (2019) eKLR, Gikonyo J In dealing with a similar application for stay of proceedings, Gikonyo J held thus:-“Stay of proceedings should not be confused with stay of execution pending appeal. Stay of proceedings is a grave judicial action which seriously interferes with the right of a litigant to conduct his litigation. It impinges on right of access to justice, right to be heard without delay and overall, right to fair trial. Therefore the test for stay of proceeding is high and stringent”.

20. It is trite law that whether or not to issue an order for stay of proceedings is a matter of the court’s discretion exercised after due consideration of the merits of the case and the likely effect on the ends of justice.

21. I am persuaded by the case of Global Tours & Travels Limited; Nairobi HC Winding UP Cause No. 43 of 2000 where Ringera J (as he then was) set out principles to be considered in granting an order for stay of proceedings thus:-“As I understand the law, whether or not to grant a stay of proceedings or further proceedings on a decree or order appealed from is a matter of judicial discretion to be exercised in the interest of Justice .... the sole question is whether it is in the interest of justice to order a stay of proceedings and if it is, on what terms it should be granted. In deciding whether to order a stay, the court should essentially weigh the pros and cons of granting or not granting the order. And in considering those matters, it should bear in mind such factors as the need for expeditious disposal of cases, the prima facie merits of the intended appeal, in the sense of not whether it will probably succeed or not but whether it is an arguable one, the scarcity and optimum utilization of judicial time and whether the application has been brought expeditiously”.(See also HMI v KBH [2021] eKLR

22. The Court of Appeal in the case of David Morton Silverstein v Atsango Chesoni [2002]eKLR held that:-“The Court is not laying down any principle that no order for stay of proceedings will ever be made; that would be contrary to the provisions of rule 5 (2) (b) of the Court's own rules. But as the court pointed out in the case we have already cited, each case must depend on its own facts and the facts of this particular case before us, as were the facts in the earlier case, do not show that the appeal will be rendered nugatory if we do not grant a stay”.

23. In the case of Christopher Ndolo Mutuku & Another v CFC Stanbic Bank Limited [2015] eKLR the court observed that:-“What matters in an application for stay of proceedings pending appeal is the overall impression the Court makes out of the total sum of the circumstances of each, which should arouse almost a compulsion that the proceedings should be stayed in the interest of justice”

24. In order to appreciate the total sum of the circumstances in this case, it is important to understand the various applications and suits touched on in this Appeal. It was the Respondent’s case that upon being injured in an accident, he sued the insured, Daniel Oriwa Aguda in BOMET PMCC NO. 182 OF 2010 (Primary Suit). Though neither party has attached the proceedings of this suit or the Judgment thereof, it was clear from their pleadings, an undisputed fact that the Judgment in the primary suit was delivered on 18th February 2013.

25. That the Appellant herein filed a Declaratory Suit at the High Court in Kericho being HCCC NO. 103 of 2011 (Kericho Declaratory Suit) where it sought to avoid satisfying the policy issued to its insured for reasons listed in their Plaint dated 26th July 2011.

26. Sometime in the year 2016, the Respondent filed a Declaratory Suit in the Principal Magistrate’s Court in Bomet being PMCC NO. 70 OF 2016 (Bomet Declaratory Suit) that sought a Declaration that the Appellant was obliged and liable to satisfy the Decree and costs of the Primary Suit.

27. The Appellant thereafter moved the Principal Magistrate’s Court in Bomet under a Notice of Motion Application dated 13th August 2016 where he sought stay of proceedings in the Bomet Declaratory Suit pending the hearing and determination of the Kericho Declaratory Suit. In a Ruling delivered on 21st December 2016, the trial court dismissed the Application. This is the Ruling that is the subject of this Appeal, whose grounds I have already set out at the beginning of this Judgment.

28. The Appellant filed a Notice of Motion Application dated 16th January 2017 in this court seeking a stay of proceedings of the Bomet Declaratory Suit pending the hearing and determination of this Appeal. In a Ruling delivered by this court (Muya J) on 25th April 2017, the prayer for stay of proceedings was granted on condition that the Appellant deposited the Decretal amount in an interest bearing account in a reputable bank in the joint names of counsels for both the Appellant and the Respondent.

29. I have perused through the trial court proceedings and the Record of Appeal and I have noted that this Appeal was filed on 11th January 2017. I have equally noted from the trial court proceedings that the Bomet Declaratory Suit was stayed pending the determination of this Appeal.

30. It is salient to note that this is an old Appeal that ought to have been heard and determined some time ago. It appears to me that once the Appellant got its stay orders on 25th April 2017, it went to sleep. Between the year 2017 and 2022, there was a period of inactivity in the file as the Appellant did not move the court to have his Appeal heard and determined. It took a Notice to Show Cause for Dismissal dated 30th May 2022 to wake it up from its slumber.

31. The Appellant has not offered any explanation for the delay of over 5 years which I find to be inordinate and inexcusable. It has also not stated anywhere in its pleadings what became of the Kericho Declaratory Suit since 2011. In the case of Cecilia Wanja Waweru v Jackson Wainaina Muiruri & Another [2014] eKLR the Court of Appeal held:-“There is no set rule as to what constitutes inordinate delay. Whether or not a party is guilty of inordinate delay depends on the circumstances of the case. We are of the considered view that the learned judge in considering the application, should have looked at the appellant’s conduct from the time the appeal was filed up to the date the application for reinstatement was filed……..We have to ask ourselves whether the failure by the appellant to prosecute the appeal in the High Court and/or the delay in filling the application for reinstatement constitute an excusable mistake or was it meant to deliberately delay the cause of justice……. Why didn’t she set the appeal down for hearing for almost 14 years”. The reasonable explanation would be that the appellant had been indolent and had slept on her rights. She was only awakened from her slumber by the dismissal of the appeal.”(See also Utalii Transport Company Limited & 3 others v NIC Bank & Another [2014] e KLR)

32. The Appellant submitted that the Declaratory Suit in Kericho was filed much earlier than Bomet PMCC 70 OF 2016 and that the Respondent should have waited for the outcome of the Kericho suit before commencing on his Declaratory Suit in Bomet.On this issue, I however agree with the trial court’s finding that:-“Secondly, I note that although the Defendant/Applicant claims that the Plaintiff/Respondent in the present suit was aware of Kericho High Court Civil Case No. 103/2011 at the time of filing the present suit, there is no indication on record how the Plaintiff/Respondent became aware of the existence of the said suit, no affidavit was presented in evidence to show that the Plaintiff/Respondent was served with the pleadings in Kericho High Court Civil Case 103/2011 or that he was enjoined as a party to the said suit.”1. In exercise of its discretionary power in the grant of an order for a stay of proceedings, the court must carefully weigh the rights of each party. In this case, there is the Appellant who currently enjoys stay orders and has used those orders for 5 years to the detriment of the Respondent. On the other hand there is the Respondent who has been hamstrung by those orders and as a result, he is unable to have his Declaratory Suit heard and determined by the trial court. In the case of Mohammed Salim T/A Choice Butchery v Nasserpuria Memon Jamat [2013] eKLR Kasango J. held that:-“I begin by stating that the Court when it is called upon to grant stay it has to balance the interests of the Appellant with those of the Respondent. This was well stated in the case m/s Portreitz Maternity v James Karanga Kabia Civil Appeal No. 63 of 1997 where the Court had this to say-“That right of appeal must be balanced against an equally weighty right, that of the Plaintiff to enjoy the fruits of the judgment delivered in his favour. There must be a just cause for depriving the Plaintiff of that right.”

34. In the case of RWW v EKW [2019] eKLR, the court held:-“………………the Court when granting the stay however, must balance the interests of the Appellant with those of the Respondent.”

35. It must be noted that it is in everyone’s (the court, the counsels and their clients) best interest that cases are heard and determined expeditiously. In the case of Muchanga Investments Limited v Safaris Unlimited (Africa) Ltd & 2 Others [2009] eKLR, the Court of Appeal stated that:“Judicial time is the only resource the courts have at their disposal and its management does positively or adversely affect the entire system of the administration of justice.”(See also Nuru Ruga Ali & another v Commodity House Limited & 3 others (2021) eKLR)

36. The Appellant did not exercise diligence and use judicial time afforded to it wisely and it did not use it in the best interests of justice. This court cannot exercise discretion in a manner that will clearly deny the Respondent their right to fair and expeditious proceedings as commanded by Section 1 A of the Civil Procedure Act.

37. In the end, I find that the Appeal dated January 9, 2017 has no merit and the same is dismissed with costs to the Respondent.

JUDGMENT DELIVERED, DATED AND SIGNED AT BOMET THIS 19TH DAY OF OCTOBER, 2022. .......................R. LAGAT-KORIRJUDGEJudgment delivered electronically to parties for the Appellant, for the Respondent