Mukova Civil Engineering Limited v Equity Bank Limited & 2 others (Civil Case E456 of 2024) [2025] KEHC 16554 (KLR) (Commercial and Tax) (30 October 2025) (Ruling)
Neutral citation:
[2025] KEHC 16554 (KLR)
Republic of Kenya
Civil Case E456 of 2024
MA Otieno, J
October 30, 2025
Between
Mukova Civil Engineering Limited
Plaintiff
and
Equity Bank Limited
1st Defendant
Equity Insurance Agency Limited
2nd Defendant
APA Insurance Limited
3rd Defendant
Ruling
Introduction
1.Before this Court for determination is the 3rd Defendant’s preliminary objection dated 10/2/2025, raised against the Plaintiff’s suit filed herein on the following grounds:i.That the suit as against the 3rd Defendant is barred by statute of limitation, and this court therefore has no jurisdiction to entertain the same.ii.That the suit against the 3rd Defendant is an abuse of the hallowed court process.
2.Based on the foregoing grounds, the 3rd Defendant therefore prayed to have the Plaintiff’s suit struck out with costs. In support of the objection, the 3rd Defendant filed submissions dated 22/4/2025.
3.It was submitted that the Plaintiff’s claim arose from an insurance contract relating to motor vehicle KBU 696H, which was allegedly stolen on 2/2/17 and vandalized a month later. The Plaintiff reported the incident and lodged a claim with the 3rd Defendant on 9/3/17, which was declined on 6/9/17. The 3rd Defendant was, however, enjoined to the suit only on 11/9/24; over seven years after the cause of action accrued, contrary to section 4(1) of the Limitation of Actions Act, which limits contractual claims to six years.
4.The 3rd Defendant relied on Mukisa Biscuit Manufacturing Ltd v West End Distributors (1969) EA 696, Alba Petroleum Ltd v Total Marketing Kenya Ltd [2019] eKLR, Gathoni v Kenya Co-operative Creameries Ltd [1982] KLR 104, and F.M. Waweru v P. Kimingi [2007] eKLR to submit that limitation laws protect Defendants from stale claims and that time cannot be extended in contract matters.
5.It was further argued on behalf of the 3rd Defendant that Article 159 and the “oxygen principles” cannot be invoked to circumvent clear procedural timelines. The cases of Sam K. Ongeri v Catherine Gicheru [2015] eKLR and Nicholas Kiptoo Arap Korir Salat v IEBC [2014] eKLR were cited by the Counsel for the 3rd Defendant in support of this argument.
6.On its part, the Plaintiff opposed the 3rd Defendant’s preliminary objection. through submissions dated 20/6/2025.
7.The Plaintiff argued that the suit was not time-barred and that the court retained jurisdiction. According to the Plaintiff, the cause of action did not arise in 2017 when the theft occurred or when the insurance claim was lodged, but it only arose in March 2024 when the Plaintiff discovered that the insured vehicle had been completely vandalized and abandoned, marking the first clear repudiation of liability. Until then, the Plaintiff argued, the Defendants, including the 3rd Defendant, had engaged in prolonged negotiations, inspections, and assurances between 2017 and 2020, creating a legitimate expectation that the matter would be resolved amicably.
8.Counsel for the Plaintiff relied on the case of Santowels Ltd v Stanbic Bank Kenya Ltd [2018] eKLR, where the court held that time begins to run only after settlement discussions or representations cease. It was argued that the Defendants’ conduct and representations constituted a continuing cause of action and that under section 39(1)(b) of the Limitation of Actions Act, the 3rd Defendant was estopped from pleading limitation, having induced delay through promises and ongoing engagements.
9.The Plaintiff also invoked section 26(c) of the Limitation of Actions Act, contending that time did not begin to run until the Plaintiff discovered the mistake or concealment in 2024, when it became apparent that the Defendants had abandoned their obligations.
10.In conclusion, the Plaintiff urged the court to find that the claim arose only upon discovery of the final repudiation in 2024, that limitation was suspended under sections 26 and 39 of the Limitation of Actions Act and equitable principles, and that the Preliminary Objection was therefore without merit.
Analysis and determination
11.I have carefully considered the Preliminary Objection and the parties’ respective submissions. The sole issue requiring this Court’s determination is whether the suit against the Defendant herein is barred by the Limitations of Actions Act.
12.The 3rd Defendant argued that the Plaintiff’s claim is based on an insurance contract, but it is time-barred, having arisen on 9/3/2017 when the Plaintiff submitted the claim form.
13.Section 4(1) of the Limitation of Actions Act states:
14.On the other hand, Section 39 of the Limitation of Actions Act provides that:
15.While it is correct, as argued by the 3rd Defendant, that pursuant to section 4 (1) (a), claims founded on contract (as the case herein) can only be brought within six (6) years from the date of breach, Section 39 of the Act stops running of the limitation period where, among others, the person attempting to plead limitation is estopped from so doing.
16.I have analyzed the Plaintiff’s bundle of documents dated 15/8/2024. From the email correspondence between the parties, I can see that the parties engaged in discussions regarding repairs to the vehicle. In particular, in an email dated 16/1/2018, a representative of the 1st Defendant notified the Plaintiff that the garage requested for a meeting regarding the remaining repairs on the subject vehicle. The said email is found on page 34 of the bundle.
17.I note further, from the bundle of documents, that a joint inspection of the vehicle was carried out on 10/3/2018 and 16/4/2018 by the representatives of the Plaintiff and Defendants. Photographs of the inspection were produced on page 64 of the bundle.
18.The circumstances above indicate that the parties had engaged in discussions regarding the car repairs even after the Plaintiff submitted its insurance claim on 9/3/2017. The correspondence demonstrates that the matter was under active resolution and that repairs were forthcoming.
19.In this case, the Defendants’ engagement with the Plaintiff constituted a representation to the Plaintiff that repairs on the motor vehicle were being pursued. The Plaintiff only realized in March 2024, upon visiting the garage, that no repairs had been undertaken on the vehicle.
20.In Josephat Njuguna Karugu v Margaret Nduta Ngugi & 2 others [2021] KEELC 3403 (KLR), the Court acknowledged the principle under Section 39(1)(b) that where a party by their words or conduct induces another to delay legal action, the period of limitation does not run. The Court affirmed that such estoppel includes both equitable and promissory estoppel, particularly where there has been an express or implied admission of liability or a promise to rectify the issue in question.
21.In Josephat Njuguna Karugu v Margaret Nduta Ngugi & 2 others (supra), the Court stated as follows: -
22.In the premises, the Court is convinced that due to the conduct of the Defendants, they are in the present case estopped from pleading limitation of actions due to their consistent representations and conduct over an extended period, which led the Plaintiff to believe that the vehicle would be repaired.
23.In any case, the cause of action occurred in March 2024 when the Plaintiff discovered the state of disrepair in the garage, which is well within the time limitations for filing a contractual dispute.
24.The upshot of the foregoing is that the 3rd Defendant’s Preliminary Objection dated 10th February 2025 filed herein, lacks merit and is accordingly dismissed with costs.
25.It is so ordered.
SIGNED, DATED, AND DELIVERED IN VIRTUAL COURT THIS 30TH OCTOBER 2025ADO MOSESJUDGEIn the presence of: -C/A – Moses