An insurance company will have to deposit Sh32.4 million as condition to delay payment to a plastic manufacturer whose premises was burnt down by fire five years ago.
A three-judge bench of the Court of Appeal judges comprising of Justices Roselyne Nambuye, Wanjiru Karanja and Fatuma Sichale gave Mayfair Insurance 45 days to deposit the money in an interest earning account failure to which Nakuru Polyplast limited can recover Sh64.8 million compensation award.
The Sh64.8 million award was given by the High Court last May.
The three judges’ decision arose out of an appeal filed by Mayfair Insurance challenging the High Court award.
Mayfair argues that the High Court 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.
The appeal court was told that Nakuru Polyplast was in financial distress and might not be able to reimburse the amount should Mayfair win its appeal.
“Bearing in mind the circumstances surrounding this matter, we allow the application and grant stay of execution of the judgment and orders appealed against on condition that the applicants deposit 50 per cent of the decretal amount in an interest earning joint account,” the judges said.
Nakuru Polyplast took a fire insurance policy from Mayfair Insurance Company through Tevee Insurance Brokers.
This was to cover property in the factory including computers and electric equipment consisting of power bank, cable capacities, extruder control panel, switch boards, electrical wiring and computer printer all valued at Sh64,850,000. The company paid its premiums of Sh195, 425 as required.
The company’s premises were destroyed by fire on January 31, 2016.
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