1.The Petitioner filed an amended Petition dated 18th December 2018 in which they sought the following orders;a.A declaration that Fundamental Rights and Freedoms of the Petitioners have been violated by all the Respondents.b.A declaration and order that the Respondents jointly and severally should meet and make payment of all Decretal sums and costs entered against the Defendants in the cases arising from accidents for which the Petitioners had obtained insurance cover under Section 4 of the Insurance (Motor Vehicles Third Party Risks) Act.c.An order for a permanent injunction to restrain all Claimants from executing the Court judgements against the Petitioners in respect of accidents for which the Petitioners had obtained insurance cover under section 4 of the Insurance (Motor Vehicles Third Party Risks) Act.d.An order directing the 1st and 2nd Respondents to take measures that the court may deem fit to ensure that the 3rd Respondent is operating in accordance with the prevailing legal framework.e.Costs of this petition.f.Any other relief that this Honourable court may deem just to grant.
2.The Petition was supported by the Affidavit of Peter M Muinde sworn on 6th of November 2020 in which he deposed that he is a retired police officer who owned of Motor Vehicle Registration number KBU 400A and KBU 308A which were operating as public service vehicles. However, in 2015 due to the perceived conflict of interest in police officers owning public service vehicles, he transferred his proprietary interests to the 2nd Petitioner in 2016. The insurance policies with the 3rd Respondent were however retained and the 3rd Defendant even took up defenses of the claims arising from various accidents. He contended that the 2nd Petitioner forwarded all summons to enter appearance to the 3rd Respondent to either settle or defend the suits as it would deem fit which resulted in interlocutory judgments for the undefended suits and judgement against the Petitioners in the defended ones.
3.It was his case that whereas the 3rd Respondent is obliged to meet the claims in 90 days of being lodged, the same was not done leading to auctioneers seeking to attach his personal property despite him transferring the business two years back. He contended that this happened despite having paid up premiums to the 3rd Respondent. He lamented that this amounts to double jeopardy. In his view, it is against public interest for the 3rd Respondent to fail to fulfil its financial obligations under the eye of the 1st and 2nd Respondent.
4.The Application is also supported by the affidavit of Ian Kay Mwau, the director of the 2nd Petitioner sworn on 6th November 2020 in which apart from confirming the averments made by the 1st Petitioner, he deposed that the Respondents have violated Article 40 (2 and3), 46 ,47 (1), 48 and 50 of the Constitution of Kenya.
5.He deposed that the 1st and 2nd Respondents despite having powers to supervise, monitor and regulate insurance players failed to perform its role in noting that the 3rd Respondent is facing liquidity problems and acting early enough to protect the public or invoking the Policy Holders Compensation fund despite signs that all is not well. This, according to him, was an abdication of the powers given under Section 67 C of the Insurance Act since he failed to make a decision one way or the other in respect of the 3rd Respondent.
The 1st and 2nd Respondents’ Case
6.On their part, the 1st and 2nd Respondents filed grounds of opposition on 18th February 2019 dated 15th February 2019 in which they raise the following grounds;a.The Petition raises no justiciable constitutional issues for determination.b.The Petition is seeking to litigate a commercial claim based on a contract with the 3rd Respondent as a constitutional petition.c.The petition is a claim for enforcement of the terms of a judgement and raises no justiciable constitutional issue for determination.d.The Petitioners claim has failed to meet the threshold for specificity in drafting as elucidated by the principles in the case of Anarita Karimi Njeru vs Republic  1 KLR 154 reiterated in by the Court of Appeal in the case of Mumo Matemu vs. Trusted Society of Human Rights Alliance, Civil Appeal No 290 of 2012.e.The Petition has failed to meet the basic requirements as form as set out in Rule 10 of the Mutunga Rules (the Constitution of Kenya (Protection of Rights and Fundamental freedoms) Practice and Procedure Rules 2013)f.The Petition has failed to meet the requirements of Rule 11(2) of the Mutunga Rules.g.The Petition has failed to specifically outline and demonstrate his claim against the 2nd Respondent.h.The Petition has failed to meet the requirements of section 107 of the Evidence Act, Cap 80.i.The petition violates the provisions of Article 50 (2) of the Constitution of Kenya (2010) in failing to enjoin the interested parties against whom he is seeking orders.j.The Petitioner has failed to demonstrate the requirements for a grant of orders of permanent injunction having failed to demonstrate the elements as set out in the case of East Africa Industries vs Trufoods  420 EA and in the case of Giella vs Cassman Brown  EA 358 affirmed in various superior court authorities.k.The orders sought in the Petition and the consequential orders thereto would have adverse effects on the interests of third parties aptly referred to as “interested parties” who are not parties to the petition.l.As per Article 50 as read together with Article 47, it is only fair and just that the “interested parties” be granted an opportunity to be heard.m.The orders sought in the Petition are vague and ambiguous and therefore incapable of being granted by this Honorable Court.n.The Petitioner has failed to demonstrate that they are entitled to an order for costs as pleaded.o.The Petition is vague and does not raise issues for Constitutional interpretation by this Honourable Court and therefore ought to be struck out with costs to the Respondents.p.The Petition is vague, frivolous, vexatious and an abuse if the Honourable Courts time and process
7.The 3rd Respondent did not file a response to the Petition.
8.The interested parties being the claimants in the accident involving Motor Vehicles registration numbers KBV 400A and KBA 308A filed a grounds of objection dated 8th of June 2021 in opposition of the Petition in which they stated that the Petitioner has been settling the decretal sums in unacceptable terms and has never sought stay of execution.
9.The interested parties opined that this was not an issue that they should be party to, as it was an issue of breach of contract between the Petitioner and the Respondent and thus the Petition is meant to deny them the fruits of their judgement.
10.The Petition was disposed of by way of written submissions.
11.The Petitioner filed submissions dated 7th October 2021 in which they highlighted four (4) issues. The first issue was whether the petition was drafted in accordance with the requirements. The Petitioners submitted that the amended petition expressly stated the violated provisions, adequately pleaded the manner of violation and concisely stated the remedies sought in accordance with the Anarita Karimi Njeru Rule and the Mutunga Rules.
12.Secondly, as to whether the petition raised justiciable constitutional issues, the Petitioner relied on the cases of CNM v WMG  eKLR and Maggie Mwauki Mtalaki vs. Housing Finance Company of Kenya  eKLR and contended that the Petition fits within the description of what raises constitutional questions. It was submitted that Article 46 of the Constitution had been infringed as they are consumers of insurance services that they have paid for and that the Insurance Regulatory Authority exists to regulate the said insurance services which they never enjoyed. According to them, Article 46 of the Constitution applies to goods and services offered by public entities or private persons. They contended that the conduct of the regulator is in question and they needed to account for their inaction. Thus to the Petitioners, this dispute is beyond two contracting parties and concerns the management of the insurance industry. Reliance was placed on the case of Commission of Administrative Justice vs. Insurance Regulatory Authority and Another  eKLR.
13.As to whether the Petitioners fundamental rights and freedoms have been violated, the Petitioners contended that they complied the law and took out insurance cover for their motor vehicles and even paid premiums but the 3rd Respondent abdicated its role and abandoned the Petitioners at their time of need by failing to satisfy the decrees issued against the Petitioners. In this regard, they cited Article 46 of the Constitution and the UN Guidelines for Consumer Protection as well as the cases of Alan E Donovan vs. Kenya Power & Lighting Company  eKLR and Mark Ndumia Ndung;u vs Nairobi Bottlers Limited and Another  eKLR. It was their submissions that the 3rd Respondent did not provide quality services as required and despite the interested parties’ contention that some payments have been made, it had been trickling at unacceptable rates. Further that this conduct amounts to deceit and obtaining by false pretense. In addition to this, the Petitioners maintained that they were suffering losses every week as they were constantly being executed against and their businesses ruined, leading to heavy losses thus exposing them to the risk of insolvency from the number of claims. They relied on the case of Caroline Karimi Moses vs Insurance Regulatory Authority & 3 others  eKLR.
15.The Petitioners contended that the 1st Respondent failed to note the 3rd Respondent’s liquidity problems in order for it to act early enough in order to protect the public or even invoke payments under the Policy Holders Compensation Fund. As a result, the Petitioners’ rights to property under Article 40 of The Constitution has been breached. In support of their submissions, the Petitioners referred to Article 47 of the Constitution on fair administrative action and contended that the actions of the 1st and 2nd Respondent were slow, inefficient, unlawful, unreasonable and unfair.
16.On his part, it was contended that the 2nd Respondent failed to compel the 1st Respondent to ensure that the 3rd Respondent is compliant with all policies and claims therein. As a result of the acts of omission of the Respondents, they have been deprived of their rights, the accident victims have been unable to recover compensation for their injuries and the public confidence in the insurance sector as a whole has been eroded since one can never be sure whether the claims will be paid.
17.To the Petitioners, they are entitled to the orders sought, and urged the court to grant them the orders sought.
1st and 2nd Respondents’ Submissions
18.On behalf of the 1st and 2nd Respondents, it was submitted that the Petition is indicative of a commercial dispute arising out of a contractual relationship between the Petitioners and the 3rd Respondent herein and thus does not raise questions of constitutional nature which are guided by principles of the law of contract. While relying on the Mutunga Rules particularly Rule 10 and 4, it was submitted that courts have settled the question of substance and the nature of drafting a Constitutional Petition in the case of Anarita Karimi Njeru v Republic [1976-80] 1 KLR 1272.
19.It was submitted that this matter does not qualify as a constitutional petition as for a matter to qualify as a constitutional petition it must raise constitutional issues/questions for determination by the court, the petition must outline the constitutional provisions violated, the nature of injury caused or likely to be caused to the petitioner or the person in whose name the Petitioner has instituted the suit or in a public interest case to the public, class of persons or community and it must be drafted with sufficient specificity as to enable the Respondent respond to the allegations. It was therefore contended that the Petition must fail.
20.Furthermore, it was submitted that the 1st and 2nd Respondents were not parties to the suits by virtue of their contractual nature in violation of privity of contracts. The said Respondents averred that subjecting them to pay unspecified sums arising out of the claims would amount to a great injustice and a violation of the principles of public finance management under Article 201(d) as public funds are not for settling private debts arising out of private contractual relationships.
21.The 3rd Respondent and the interested parties did not file submissions.
22.I have considered the Petition, the responses thereto and the submissions.
23.It is contended that there is lack of precision in the manner in which this petition was pleaded and that this falls afoul of the principles in the case of Anarita Karimi Njeru v Republic [1976-80] 1 KLR 1272, Mumo Matemu vs. Trusted Society of Human Rights Alliance, Civil Appeal No 290 of 2012 and Rule 10 of the Constitution of Kenya (Protection of Rights and Fundamental freedoms) Practice and Procedure Rules 2013 (otherwise known popularly as “Mutunga Rules”).
24.It is important to point out that the decision in Mumo Matemu v Trusted society of Human Rights Alliance & 5 Others  eKLR was an approval of the earlier decision in the oft cited case of Anarita Karimi Njeru v Republic,  KLR 154. It is however my considered view that the decision in Anarita Karimi Njeru must now be read in light of the provisions of Article 22(3)(b) and (d) of the Constitution under which the Chief Justice is enjoined to make rules providing for the court proceedings which satisfy the criteria that formalities relating to the proceedings, including commencement of the proceedings, are kept to the minimum, and in particular that the court shall, if necessary, entertain proceedings on the basis of informal documentation and that the court, while observing the rules of natural justice, shall not be unreasonably restricted by procedural technicalities. Whereas it is prudent that a petitioner ought to set out with reasonable degree of precision that of which he complains, the provision said to be infringed and the manner in which they are alleged to be infringed, to dismiss a constitutional petition merely because these requirements are not adhered to would in my view defeat the spirit of Article 22(3)(b) under which proceedings may even be commenced on the basis of informal documentation. This is not to say that the Court ought to encourage and condone sloppy and carelessly drafted petitions. What it means is that:
25.It must similarly be remembered that a High Court is by virtue of the provisions of Article 165 of the Constitution a constitutional court and therefore where a constitutional issue arises in any proceedings before the Court, it is enjoined to determine the same notwithstanding the procedure by which the proceedings were instituted. In my respectful view, even where a party has not expressly stated the provision of the Constitution under which his petition is brought, as long as the Court can deduce the provisions of the Constitution threatened with violation or violated the Court ought not to dismiss the petition merely because the provisions are not cited in the Petition.
26.In my view where it is apparent to the Court that the Bill of Rights has been or is threatened with contravention, to avoid to enforce the Bill of Rights on the ground that the supplicant for the orders has not set out with reasonable degree of precision that of which he complains has been infringed, and the manner in which they are alleged to be infringed where the Court can glean from the pleadings the substance of what is complained of, would amount to this Court shirking from its constitutional duty of granting relief to deserving persons and to sacrifice the constitutional principles and the dictates of the rule of law at the altar of procedural issues. Where there is a conflict between procedural dictates and constitutional principles especially with respect to the provisions relating to the Bill of Rights it is my view and I so hold that the latter ought to prevail over the former.
27.My view is informed by the decision of the Court of Appeal in Peter M. Kariuki v Attorney General  eKLR, in which the Court declined to adopt the Anarita Karimi (supra) position, line, hook and sinker when it expressed itself inter alia as follows:
30.It is therefore my view that even where before the Court is a “home-made” petition, unless it is contended by the Respondent that he is unable to discern the complaints raised therein, the Court as the defender of the Constitution must arise to a higher calling by interrogating the issues in contention instead of elevating technicalities to fetish.
31.It is contended that the issues raised herein are purely contractual matters which do not rise to the level of Constitutional issues. In Muiruri vs. Credit Bank Ltd & another  1 KLR 385, Nyamu, J held that a constitutional issue is that which directly arises from the court’s interpretation of the Constitution; for example – what is a fair trial is a constitutional issue and the courts have interpreted what is the meaning of a fair trial. In Ngoge vs. Kaparo & 4 others  2 KLR 193, Court the expressed itself as hereunder:
34.Further afield, in NM & Others vs. Smith and Others (REEDOM OF Expression Institute as Amicus Curiae) 200(5) S.A 250 (CC) the Constitutional Court of South Africa stated that:
35.Similarly, in Minister of Home Affairs v Bickle & others  L.R.C. Cost.755, Georges, CJ held as follows;
36.The judge added that:
37.Our own Supreme Court has clarified its position with regard to appeals filed in accordance with Article 163(4)(a) and in Peter Oduor Ngoge v Hon. Francis Ole Kaparo Petition No. 2 of 2012  eKLR declined to hear an appeal and stated:
38.Subsequently, in Erad Suppliers & General Contractors Ltd. vs. National Cereals & Produce Board Petition No. 5 of 2012 the Court held that:
39.It is in that light that I understand the Court’s position in John Harun Mwau vs. Peter Gastrow& 3 Others  eKLR that the Constitution only ought to be invoked when there is no other recourse for disposing of the matter and in which the Court expressed itself in the following terms:-
42.Therefore, it is my view and I so hold that to institute a Constitutional Petition with a view to circumventing a process by which institutions established by the Constitution are to exercise their jurisdiction is an abuse of the Court process. To allow entertain such a course would lead to the Courts crippling such institutions rather than nurturing them to grow and develop.
44.The rationale for this was given in Rapinder Kaur Atwal vs. Manjit Singh Amrit Petition No. 236 of 2011 where it was held that:
46.That brings me to the matter at hand. In this petition, it is contended that the 1st Respondent failed in its regulatory duty to supervise the operations of the 3rd Respondent in order to ensure that those who are consumers of the 3rd Respondent’s insurance services do not suffer as a result of the 3rd Respondent’s actions or inactions. Article 23(1) of the Constitution states;
47.Article 165 of the Constitution of Kenya provides the jurisdiction of the High Court;
48.The Petitioners, inter alia, allege violation of Article 46 of the Constitution which provides that;Article 46 provides that;Article 47 (1) provides that;
49.According to the Petitioners, they were insured by the 3rd Respondent who has failed to meet his end of the bargain by failing to pay the interested parties and this settle the various decrees leading to the Petitioners property being executed and attached by various auctioneers. That contention is not disputed by the 3rd Respondent. It is contended that had the 1st Respondent carried out its statutory obligations, the matter could have been salvaged and that the Petitioners rights would not have been threatened. Mativo, J in the case of CNM vs WMG  eKLR in which Mativo, J cited with approval the South African case of Fredericks & Others vs MEC for Education and Training, Eastern Cape & Others  23 ILJ 81 (CC) in which Justice O’Regan noted as follow:-
50.In my view, where it is alleged that as a result of the failure by a state organ to carry out its statutory mandate, a person’s rights are threatened with violation or have been violated, the matter transcends the contractual arena and enters the constitutional arena. In this case, it cannot be said that the matter is contractual since there is not contract between the petitioners and the 1st and 2nd Respondents, yet they are being blamed for exposing the petitioners to a risk of losing their rights to properties as a result of their inaction.
51.Having considered the issue raised herein I find that the issues raised herein justify the filing of a constitutional petition and that the petition is properly before this court.
52.According to section 3A of the Insurance Act, the objects and functions of the 1st Respondent are:
54.It is therefore clear that insurance cover is not just a contractual relationship between the insured and the insurer. The relationship in fact gives rise to a statutory obligation on the part of the insured. That the relationship is regulated by statute shows the importance attached by the State to such relationships. Considering the fact that such relationships affect third parties to the contract such as passengers and those who suffer injury while using the services covered by the insurance policy, it is only expected that the State would also take a keen interest on how the insurance industry is being run so as to give meaning to the compulsory requirement for those to take their vehicles to the road to take out appropriate covers. When motor vehicle owners are compelled to take out insurance policy covers, they have legitimate expectation that the State will efficiently regulate that sector so that in the event that they are called upon to compensate those who suffer injuries that are covered by the policy, they will be protected from having to directly compensate the injured. Mativo, J in Commission on Administrative Justice vs. Insurance Regulatory Authority & Another  eKLR similarly expressed himself as follows:
55.In my view, it serves no purpose for the State to compel people to take out policy covers when at the end of the day, the State does not ensure that people benefit from the services they are paying for. The people have delegated their authority to the State in expectation that the State will undertake its mandate as expected by the people. When the State or its organs fails to do so, then the State must compensate the people who suffer as a result of its failure to live to its expectation. Otherwise, the people may then recall their mandate which they delegated to the State and its organs in which event you have anarchy.
56.Therefore, where the State fails to protect the insured against unscrupulous insurers yet ensure that the insured take out insurance covers at their costs, it is only just that the State takes responsibility for its failure to regulate the players in the industry otherwise it would be assisting those insurers who use statutes as instruments of fraud. Insurance companies do not just collapse. Before they do so, there are usually tell-tale signs or indicators which can easily be discerned by hawk eyed officers of the 1st Respondent if keen enough instead of waiting until the insurer cannot meet its statutory obligations before moving in to perform the last rights.
57.Once the said signs become apparent, the 1st Respondent should move with speed and invoke his powers under Section 67 C (2) which provides that;
58.I am not holding that in every case where an insurance company collapses, the 1st Respondent should be held liable. Where the 1st Respondent takes the necessary steps to ensure that an insurance company operates within the law but due to matters that the 1st Respondent was unable to unearth despite exercise of reasonable diligence, the 1st Respondent would not be liable. In this case, despite being given an opportunity to explain itself, the 1st Respondent has not stated what action, if any, it took to forestall the imminent collapse of or inability by the 3rd Respondent to meet its statutory obligations as a result of which the Petitioners’ rights have been violated or are threatened with violation. Its failure to explain itself in this petition can only mean that it never performed its mandate under the Insurance Act and for that it is constitutionally liable.
59.However, as the third party victims of the actions or inactions of the 1st Respondents cannot be subjected to suffer for the same, they ought not to be embroiled in the fight between the petitioners and the 1st Respondent.
60.I have said enough to show that there is merit in this petition. In the premises the orders which commend themselves to me and which I hereby grant are as follows:1.A declaration that Fundamental Rights and Freedoms of the Petitioners have been violated by the 1st and 3rd Respondents.2.A declaration and order that the 1st Respondent should meet and make payment of all Decretal sums and costs entered against the Defendants in the cases arising from accidents for which the Petitioners had obtained insurance cover under Section 4 of the Insurance (Motor Vehicles Third Party Risks) Act.3.An order directing the 1st and 2nd Respondents to take measures to ensure that the 3rd Respondent is operating in accordance with the prevailing legal framework.4.The Costs of this petition are awarded to the Petitioners to be borne by the 1st Respondent