Uap Insurance Co. Limited v Karanja [2022] KEHC 11231 (KLR)

Uap Insurance Co. Limited v Karanja (Civil Suit 175 of 2019) [2022] KEHC 11231 (KLR) (Civ) (13 June 2022) (Judgment)

Neutral citation: [2022] KEHC 11231 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Law Courts)

Civil

Civil Suit 175 of 2019

CW Meoli, J

June 13, 2022

Between

Uap Insurance Co. Limited

Plaintiff

and

Phillip Karanja

Defendant

Judgment

1. UAP Insurance Co. Ltd, (hereafter the plaintiff) filed suit on August 21, 2019against Phillip Karanja (hereafter thedefendant) seeking inter alia a declaration that the plaintiff is entitled to repudiate any claims arising from the road traffic accident that occurred on October 6, 2012 and is not bound to compensate the claimants in the following suits: Nairobi – CMCC No. 3787 of 2013 – Jackline Karimi v Phillip Nyota, Paul Ng’ang’a & John Wainaina; Nairobi – CMCC No. 3788 of 2013 Peter Kanyanja v Phillip Nyota, Paul Ng’ang’a & John Wainaina; & Nairobi – CMCC No. 4441 of 2013 Joy Mukami v Phillip Nyota, Paul Ng’ang’a & John Wainaina (hereafter primary suits). It was averred that the plaintiff had insured the Defendant’s motor vehicle registration number KAY 303R (hereafter insured’s motor vehicle) under policy 202/070/1/101921/2012 and that on or about the November 14, 2012the plaintiff received statutory notices from potential claimants, of their intention to file suits regarding the road traffic accident that occurred on October 6, 2012. It was further averred that theplaintiff subsequently received summons in respect of the primary suits and in turn appointed an advocate to represent the defendant. That it was a term of the policy that thedefendant would accord the plaintiff and its advocates the necessary cooperation in defending the primary suits. However, in breach of his obligation under the policy the defendant neglected to avail the necessary witnesses and as a result the plaintiff’s advocate ceased to represent him in the aforesaid primary suits.

2. The defendant despite being served with summons herein, failed and or neglected to enter appearance or file defence and on August 13, 2020 the plaintiff requested for interlocutory judgment in default of appearance and or a defence.

3. The suit proceeded for formal proof hearing during which Frankline Njuki Nyaga (PW 1) testified on behalf of the plaintiff and was the sole witness to adduce evidence in the proceedings. He identified himself as a senior legal officer at theplaintiff Company and adopted his witness statement datedAugust 13, 2019 as his evidence in chief. He also produced the Policy document & Schedule as (P. Exh.1) and demand letter & Statutory Notice as (P. Exh.2). It was his evidence before this court that the policy document, (P. Exh.1) stipulated the duty of the insured under condition precedent No. 5 and that the defendant breached the condition. He asserted therefore that theplaintiff was exempted from liability in respect of the primary suits arising from the accident that involving the insured’s motor vehicle.

4. Upon the close of its case, theplaintiff’s counsel filed submissions in respect of the matter. Counsel for theplaintiff submitted that under Section 2 Clause 2 of the Policy Document the defendant was entitled to seek indemnity from the plaintiff for any claim that may become legally payable in respect to inter alia bodily injury. However, under the exceptions to the said clause, the plaintiff was not liable to indemnify the defendant, if the defendant did not observe “Condition No. 5”. That the said provision created a condition precedent to assumption of liability to the effect that the defendant was obligated to notify the plaintiff of the occurrence of the material accident.

5. It was further submitted that theplaintiff only became aware of the of the accident upon receipt of the statutory notice and demand letter from the claimants; that the defendant failed to cooperate with the appointed advocates and to document the claim or avail witnesses. Relying on The Law of Marine Insurance 2nd Edition (2006) Pg. 536 and the decision English decision in Bank of Nova Scotia v Hellenic Mutual War Risks Association (Bermuda) Ltd (The Good Luck) [1992] 1AC 233 the Plaintiff’s counsel argued that notification of an event likely to give rise to a claim was an obligation and a condition precedent to the duty of the plaintiff to indemnify the defendant. And hence, the failure by the defendant to satisfy the said condition entitled the plaintiff to repudiate any claims. He asserted that the plaintiff is not liable to satisfy any judgment that may arise out of the primary suits. The court was thus urged to grant the prayers in the plaint with costs.

6. The court has considered the pleadings by the plaintiff as well as the submissions filed in respect of the matter. The sole issue for determination is whether plaintiff has established on a balance of probabilities that the defendant was in breach of the policy of insurance and whether the plaintiff is entitled to repudiate any liability for the primary suits. Pertinent to the determination of the said issue are the pleadings, which form the basis of the parties’ respective cases before this court. Hence a review thereof is apposite before dealing with evidentiary matters.

7. In Wareham t/a A.F. Wareham & 2others Kenya Post Office Savings Bank [2004] 2 KLR 91, the Court of Appeal stated in this regard that: -“We have carefully considered the judgment of the superior court, the grounds of appeal raised against it and the submissions before us on those matters. Having done so we are impelled to state unequivocally that in our adversarial system of litigation, cases are tried and determined on the basis of the pleadings made and the issues of fact or law framed by the parties or court on the basis of those pleadings pursuant to the provisions of Order XIV of the Civil Procedure Rules. And the burden of proof is on the Plaintiff and the degree thereof is on a balance of probabilities. In discharging that burden, the only evidence to be adduced is evidence of existence or non-existence of the facts in issue or facts relevant to the issue. It follows from those principles that only evidence of facts pleaded is to be admitted and if the evidence does not support the facts pleaded, the party with the burden of proof should fail.”

8. The Plaintiff by is amended plaint averred at paragraphs 3, 4, 5, 6, 7 and 8 that:3. At all material times, the plaintiff had insured the defendant’s motor vehicle registration number KAY 303R under policy 202/070/1/101921/2012. The Plaintiff will rely on the said policy for its true purport and effect.4. That on or about the November 14, 2012the plaintiff received a statutory notice from a potential claimant pursuant to cap 405 Laws of Kenya of an intention to institute civil proceedings in respect of a road traffic accident that had occurred on the October 6, 2012involving the said vehicle along the Northern bypass Nairobi.5. On February 23, 2015, the plaintiff received summons to enter appearance and plaint in the following suits;-a.Nairobi – CMCC No. 3787 of 2013 – Jackline Karimi v Phillip Nyota, Paul Ng’ang’a & John Wainainab.Nairobi – CMCC No. 3788 of 2013 Peter Kanyanja v Phillip Nyota, Paul Ng’ang’a & John Wainainac.Nairobi – CMCC No. 4441 of 2013 Joy Mukami v Phillip Nyota, Paul Ng’ang’a & John Wainaina

6. The plaintiff duly appointed advocates to represent thedefendant.

7. It was a term of the policy that the defendant would accord the plaintiff and its advocates the necessary co-operation in defending the suits.

8. In breach of his obligations under the policy, the defendant neglected to avail the necessary witness and as a result the plaintiff’s advocates cased to represent him in the aforesaid suits w.e.f August 30, 2017.

Particulars Of BreachThe defendant was in breach of the insurance policy and contract by;-a.Disabling theplaintiff from properly defending the third party suits.b.Failing to meet his obligation under the policy.” (sic).

9. The plaintiff’s claim is founded on alleged breach of contract. At the hearing, PW1 adopted his witness statement whose key assertions are that:4. Thatthe plaintiff appointed advocates to defend the third party suits and requested the defendant to co-operate in the defence.5. Thatthe defendant declined willfully or otherwise co-operate with the advocates appointed by the plaintiff who subsequently on August 30, 2018ceased to represent him”. (sic) .

10. The onus is on the plaintiff to prove the alleged breach of contract. The applicable law as to the burden of proof is found in section 107, 108 and 109 of the Evidence Act which provides that;(1)Whoever desires any court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts must prove that those facts exist.(2)When a person is bound to prove the existence of any fact it is said that the burden of proof lies on that person. 108. The burden of proof in a suit or proceeding lies on that person who would fail if no evidence at all were given on either side…. 109. The burden of proof as to any particular fact lies on the person who wishes the court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on any particular person.”

11. In Karugi & another v Kabiya & 3 others [1987] KLR 347 the Court of Appeal stated that:“[T]he burden on a plaintiff to prove his case remains the same throughout the case even though that burden may become easier to discharge where the matter is not validly defended and that the burden of proof is in no way lessened because the case is heard by way of formal proof….The plaintiff must adduce evidence which, in the absence of rebuttal evidence by the defendant convinces the court that on a balance of probabilities it proves the claim.”

12. The Policy Document between the parties that is the subject of the disputed was produced into evidence as (P.Exh.1) provided at Section II Clause 5 that:“Legal Representation and DefenceThe Company may at its own option;a.Arrange for legal representation at any inquest or fatal inquiry in respect of any death which may be the subject of indemnity under this section.b.Undertake the defence of proceedings in any court of law in respect of any act or alleged offence causing or relating to any event which may be the subject of indemnity under thesection.” (Sic)

13. Condition 5 of the said Policy Document provides that; -“Notification of AccidentsIn the event of any occurrence which may give rise to a claim under the policy the insured shall as soon as possible give notice thereof to the company with full particulars. Every letter claim writ summons and process shall be notified or forwarded to the company immediately on receipt. Notices shall also be given to the company immediately the insured or any person claiming to be indemnified shall have knowledge of any impeding prosecution, inquest or fatal inquiry in connection with any such occurrence. In the case of theft or other criminal act which may give rise to a claim under this policy the insured shall give immediate notice to the police and cooperate with the company in securing the conviction of the offender.

14. No evidence was led to demonstrate the pleaded breach regarding the alleged non- co-operation by the defendant with the appointed advocates. not even a letter to the defendant by such advocates or other correspondence was tendered before the court. Instead, the plaintiff through the oral statement of PW1 and submissions appeared to present a case that somewhat differs from the one pleaded: that the defendant failed to notify the insurer of the occurrence of the accident as provided in Condition No.5 of the Policy document. Besides, section II clause 5 above and Condition No.5 relied on by the plaintiff do not expressly spell out the defendant’sobligation to co-operate with the appointed advocates and the sanction for breach.

15. Parties are bound by their pleadings, whether the suit is defended or not. If theplaintiff’s case was also premised on the alleged failure by the defendant to give notificationof the occurrence of the accident, the particulars of the said breach ought to have been pleaded. Nowhere does the amended plaint refer to such a breach. Indeed, the admitted action by the plaintiff of appointing counsel to represent the defendant in the primary suits appears to negative the assertion made by the Plaintiff in that regard.

16. Although this suit proceeded ex parte, the observations made by Visram J. (as he was) in Associated Electrical Industries Ltd v William Okoth (2004) eKLR are relevant:“I entirely agree with the appellant’s submissions that parties are bound by their pleadings. The respondents have pleaded one thing and sought to prove another. In such a situation the defendant/appellant was highly prejudiced. It sought to defend the case against it as stated in the plaint. And the case stated in the plaint was never proved”.

17. No doubt the learned Judge was echoing the words of the Court of Appeal in Galaxy Paints Company LtdvFalcon Guards Ltd(2000) eKLR; where the court stated:“It is trite law, and the provisions of OXIV of the CPR, are clear that issues for determination in a suit generally flow from the pleadings, and unless the pleadings are amended in accordance with the provisions of the Civil Procedure Rules, the trial court, by dint of the provisions of OXXr4 of the aforesaid rules, may only pronounce judgment on the issues arising from the pleadings or such issues as the parties have framed for the court’s determination”.

18. Applying the above dicta to this case, the court finds that the plaintiff has failed to prove on a balance of probabilities the case pleaded against the defendant. the suit could not be salvaged by the late introduction of a different allegation of breach of the policy by the defendant. Consequently, the suit is hereby dismissed.

DELIVERED AND SIGNED ELECTRONICALLY AT NAIROBI ON THIS 13TH DAY OF JUNE 2022. C.MEOLIJUDGEIn the presence of:Mr. Ngechu for the PlaintiffDefendant: N/AC/A: Carol