News

Mayfair directed to deposit Sh32m in compensation row

case_2
BDgeneric_logo

Summary

  • Mayfair Insurance has been directed to deposit Sh32.4 million as a condition to delay compensation to a Nakuru plastic manufacturer whose premises was gutted by fire five years ago but which the underwriter maintains was an act of arson.
  • Nakuru Polyplast Co. Ltd had successfully argued that the fire that razed its premises in 2016 was an accident and the High Court awarded the firm Sh64.8 million.
  • Mayfair filed an appeal arguing that Justice Rachel Ng’etich ignored the evidence of its expert, which pointed that the fire was as a result of arson.

Mayfair Insurance has been directed to deposit Sh32.4 million as a condition to delay compensation to a Nakuru plastic manufacturer whose premises was gutted by fire five years ago but which the underwriter maintains was an act of arson.

Nakuru Polyplast Co. Ltd had successfully argued that the fire that razed its premises in 2016 was an accident and the High Court awarded the firm Sh64.8 million.

Mayfair filed an appeal arguing that Justice Rachel Ng’etich ignored the evidence of its expert, which pointed that the fire was as a result of arson.

A bench of three judges then ordered the insurer to deposit half of the amount in an interest earning account within 45 days, failure to which Nakuru Polyplast Ltd would be free to enforce payment of whole amount.

“In this case, we appreciate that the amount involved is substantial. We also appreciate that if paid out to the respondents, in the event the intended appeal succeeds, it would be arduous to recover it, more so in view of the applicants’ assertion that the respondent has closed down its operations,” said Justices Roselyn Nambuye, Wanjiru Karanja and Fatuma Sichale.

The underwriter moved to the Court of Appeal to challenge the award of Sh64.8 million after Judge Rachel Ng’etich rejected the claim by Mayfair that the fire at Nakuru Polyplast Co. Ltd in January 2016 was an act of arson. She ordered the insurer to indemnify the company as agreed.

In the intended appeal, Mayfair argues that the judge disregarded its evidence regarding the company’s (Nakuru Polyplast) business status at the time of the fire incident.

The insurer maintains that the fire was an act of arson and the judge disregarded the evidence of its expert witness on the cause of the fire.