M’iruura & another v Kariuki [2023] KEHC 25385 (KLR)

M’iruura & another v Kariuki (Civil Appeal E022 of 2022) [2023] KEHC 25385 (KLR) (9 November 2023) (Judgment)

Neutral citation: [2023] KEHC 25385 (KLR)

Republic of Kenya

In the High Court at Naivasha

Civil Appeal E022 of 2022

GL Nzioka, J

November 9, 2023

Between

Joseph Kiili M’iruura

1st Appellant

Esther Kendi

2nd Appellant

and

Margaret Wambui Kariuki

Respondent

(Being an appeal against the judgment delivered by Hon. Y. M. Barasa (SRM) dated 4th February 2022 vide Civil Case No. E075 of 2020 at the Chief Magistrate’s Court at Naivasha)

Judgment

1. The appeal herein arises from the decision of the trial court vide Chief Magistrate’s Civil case No E075 of 2020 delivered on the 4th day of February 2022, by the Hon. Y.M Barasa.

2. The decision was informed by the fact that, the plaintiff therein (herein “the Appellant”) sued the defendant therein (herein “the Respondent”) seeking for judgment against the respondent for: -a.General damages under the Law Reform Act, Marriage Act and Fatal Accidents Act for pain and suffering, loss of expectation of life, loss of dependency and loss of consortium and servitium.b.Special damages aforesaidc.Cost of the suitd.Interest at court rates

3. The claim arose out of a road accident that occurred on 30th August 2020, where in the deceased who was riding a motor bike registration number KMCZ 760S along Nakuru-Nairobi road was hit by a motor vehicle registration number KCS 391 G Toyota Vanguard driven by the respondent and/or her agent or driver. That as a result the deceased lost his life. The appellant blamed the respondent for negligently driving the vehicle and causing the accident.

4. In the resultant judgment, the trial court made an award as follows: -a.pain and suffering----------------------Kshs 50,000b.loss of expectation of life---------------Kshs 100,000c.loss of dependency--------------------Kshs 2,105,600Total ---------------------------------Kshs 2,165,600d.Special damages ---------------------Kshs 47,145e.Costs of the suit plus interest

5. However the appellant is aggrieved is purely on the award on quantum based on the grounds:-a.That the learned trial magistrate erred in law and fact in failing to appreciate that in assessing the multiplicand only Pay As You Earn (PAYE) and National Hospital Insurance Fund (NHIF) were deductible from the gross pay and therefore proceeded to deduct even outstanding loans which formed part of the deceased’s regular income.b.That the learned trial magistrate erred in law in applying the net pay in the deceased’s pay slip as the multiplicand instead of using the gross pay of Kshs 55,170 minus PAYE and NHIF deductions which would have left a net pay of Kshs 48,570. c.That the learned trial magistrate erred in law in ignoring the decision in Vincent Sululu & anothervRose Wanjiku (2016) eKLR which has been cited by the appellants in support of the argument that the multiplicand is the gross pay minus statutory deductions.

6. The appeal was disposed of vide filing of submissions. The appellant vide submissions dated 24th November, 2022 argued that the trial court acted on the wrong principles while applying the net pay of the deceased to arrive at the multiplicand. Further, the trial court relied on the case of; Hardev Kaur Dhanoa v Multiple Hauliers [EA] Ltd [2017] eKLR where the court clearly stated that in arriving at the net income only statutory deductions should be factored in and not voluntary deductions such as Sacco contributions and loan repayments.

7. Furthemore, the Court of Appeal took a similar position in the case(s) of; Mary Osano (Personal representative of the estate of Charles Otwori Ogechi v Simon Kimutai [2020] eKLR; Hellen Waruguru Wawereu (suing as the legal representative of the estate of Peter Waweru Mwenja – deceased) v Kiarie Shoe Stores Limited [2015] eKLR; Rosemary Mwasya v Steve Tito Mwasya &another [2018] eKLR; and Vincent Sululu & Christine Akinyi Okochi v Rose Wanjiru [2016] eKLR.

8. The appellants urged that the trial court misapprehend the decision in Hardev Kaur Dhanoa v Multiple Hauliers [EA] Ltd (supra) and other binding decisions and therefore acted on the wrong principles in determining the multiplicand for loss of dependency. In the circumstances, this court is justified in interfering with the award of loss of dependency as held in the case of Ken Odondi & 2 others v James Okoth Omburah T/A Okoth Omburah & Company Advocates [2013] eKLR and urged the court to re-assess the multiplicand as follows; 47,835x12x16x2/3 = Kshs 6,122,880.

9. However, the respondent on its part submitted that the multiplicand is calculated using the net pay and not the gross pay as held in the case of; Monalisa Hotel Limited v Elizabeth Habin Telephone & another (suing as the Administrators and Legal Representatives of Francis Spinks Komora (Deceased) [2021] eKLR where the court held that, the multiplicand is based on the deceased net income which is the income that remained at the disposal of the deceased after deduction of his living expenses.

10. That, the appellant are only entitled to benefit from the amount that benefited the deceased during his lifetime and therefore they are not entitled to loan deductions from the deceased payslip without proof that the loans were used for their benefit. Thus, the trial court did not misdirect itself in adopting the sum of; Kshs 16,450. 95 as the deceased’s net income.

11. Further, the trial court was correct in adopting the deceased’s net salary to assess the damages, the respondent relied on the cases of Albert Muange Mwanthi & another (suing as an administrator of the estate of Faith Ndete Muange – deceased) v Dominic Muthama Muange & another [2020] eKLR and Sterling Civil Engineering (U) Ltd v Margaret Kirumia & others SCAA No, 2 of 1991.

12. Having considered the rival arguments by the parties I find that, the only issue herein whether the trial court applied the correct multiplicand in assessing general damages for loss of dependency and in particular the figure adopted as the deceased’s income at the time of demise.

13. In that regard, whereas, the appellant argues that, it should be the gross salary less the statutory deductions in respect to; PAYE and NHIF, the respondent, argues that it should be, as held by the trial court, net pay.

14. I have considered the various authorities that have been relied on by the respective parties and there is no doubt that, both are in agreement, that, the amount applicable is not gross salary and agree that, it is net salary.

15. The question that arises is, what is this net salary? Is it gross salary less the statutory deduction only, or does it include other deductions.

16. In that regard, some courts have held that, net salary is, the gross salary less the statutory deductions only. In the case of; Hellen Waruguru Waweru (suing as the legal representative of Peter Waweru Mwenja (Deceased) v Kiarie Shoe Stores Limited [2015] eKLR the Court of Appeal stated thus: -“12. In this case, there was no complicated record of evidence to evaluate. Only Hellen testified and produced documentary evidence. On the issue of the salary, the deceased’s last pay-slip was produced and it showed clearly his gross earnings of Kshs 39,683. That is followed by no less than 13 deductions ranging from statutory deductions to loan deductions leaving a balance of Kshs 16,036. The trial court used the gross earnings as the multiplicand while the High Court used the net figure. With respect, both courts were in error.13. In the case of Chunibhai J. Patel and Another v P. F. Hayes and Others [1957] EA 748, 749, the Court of Appeal stated the law on assessment of damages under the Fatal Accidents Act which we cite in part as follows:“The Court should find the age and expectation of the working life of the deceased and consider the ages and expectations of life of his dependants, the net earning power of the deceased (i.e his income less tax) and the proportion of his net income which he would have made available for his dependants. From this it should be possible to arrive at the annual value of the dependency, which must then be capitalized by multiplying by a figure representing so many years' purchase”14. As emphasized above, the net income determines the multiplicand and it is only net of statutory deductions.”

17. This position has been reiterated in various decision of the courts. In Joseph Ndegwa & another v Japhet Ndungu Muboro the Legal Representative of the Estate of late Dishon Irungu Ndungu [2019] eKLR Mwongo, J stated that: -“42. I am persuaded by the argument that non statutory deductions are in essence for the benefit of the family. In the present case, the statutory deductions that are not for the benefit of the family are:i.Tax deductions Kshs 18,309. 00ii.NHIF Kshs 320. 00iii.NSSF Kshs 200. 00iv.Fringe benefit tax Kshs 14. 05v.University Loans Kshs 3,489. 30Total deductions from Gross Kshs 22,332. 35These deductions cannot be included in the deceased’s net salary.43. The deductions for aspects that the deceased voluntarily subscribed to such as the Pension scheme, Emergency Loans, Co-operative shares, and Co-operative loan are deductions which form part of his earnings and are a benefit to his estate that cannot be withheld from his net earnings.”

18. Similarly, in the case of; Hellen Gesare Ayoti (suing as the legal representatives of the Estate of the Late Justus Momanyi Ayot) v P.N. Mashru Ltd [2016] eKLR, Mulwa J held that: -“6. I am persuaded to agree and abide by the principles stated in the Beatrice Wangui Thairu(Supra) and make a finding that the NET salary of a person's earnings is gross salary including allowances less statutory deductions (PAYE, NHIF and NSSF). It is also my finding that any other deductions towards union dues, contributions Sacco Loans and any other loans are assumed to be so deducted for the benefit of the family, that goes to the improvement of living conditions for the family.”

19. Similarly, in Simeon Kiplimo Murey & 3 others v Kenya Bus Management Services Limited & 4 others [2014] eKLR, Majanja J held: -“The net income reflected in the payslips was the result of statutory and other deductions like salary advance, SACCO Loans, School Fee and School Boarding Programme. The net income used as the multiplicand is the net income which would have been available to the deceased to support his family. It is the gross income excluding statutory deductions (see Chunibhai J. Patel and another v P. F. Hayes and others (supra)). The learned magistrate therefore erred by excluding all deductions in calculating the net salary. Apart from statutory deductions, it is clear that the other deductions were for the benefit of the family and they ought to be taken into account in calculating the multiplicand. In the circumstances, the appellate court is entitled to intervene.”

20. Having considered the law and legal authorities referred afore, I find the net pay applicable is the gross salary less statutory deduction and in this case Kshs 47, 836. 35 and resultant award works out as follows: 47, 836. 35 x12x16x1/3= Kshs 6, 123, 052 .80 as loss of dependency. The trial court thus erred in applying all the deduction including those which are for the benefit of the deceased for example value of shares held in Sacco(s).

21. Furthermore, all insured loans cease to apply as soon as the borrower is demised as the insurance if any takes over liability, in the same vein it cannot be certain for how long the non-statutory deduction would subsist. It will therefore untenable to assume that will last the life span of the deceased

22. The upshot of the aforesaid is that, judgment is entered for the appellant as follows:a.Pain and suffering-------------Kshs 50,000b.Loss of expectation of life------Ksh 100. 000c.Loss of dependency----------- Kshs 6, 123, 052 .80d.Special damages--------------Kshs 47, 145. 00e.Total sum awarded-----------Kshs 6,320,197. 80f.Plus, costs and interest.It is so ordered.

DATED, DELIVERED AND SIGNED ON THIS 9TH DAY OF NOVEMBER, 2023GRACE L NZIOKAJUDGEIn the presence of:Mr. Matiri for Ms Mbugua for RespondentMr. Kaberia for the AppellantMs Ogutu court assistant