The High Court has declared that credit notes and assessor reports are sufficient proof of loss, in a landmark ruling that could ease the burden for insurance companies seeking compensation for accident damages.

The court said that demanding bank statements or receipts as proof of losses incurred sets the bar too high.

This came as the court overturned a decision by the Small Claims Court which had awarded Huruma Maternity & Nursing Home a paltry Sh2,900 instead of the Sh499,488 it claimed for repairs to its vehicle following a collision with a vehicle owned by a Mr Nelson Ochieng Ojwang on the Nairobi-Naivasha Road on May 25, 2022.

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The dispute centred on whether the maternity home — acting through its insurer under subrogation rights — needed to produce bank statements or official receipts to prove it had actually paid for repairs, tracing fees, and re-inspection costs.

The Small Claims Court had rejected the claim, insisting on stricter proof. But the court ruled that approach was "unduly restrictive."

"In the present case, the Appellant did not merely tender an invoice; it produced an assessor's report establishing the nature and extent of damage, invoices reflecting the quantified repair costs, and credit notes confirming settlement in the ordinary course of business," the judge said.

"In such circumstances, the court is entitled to accept the documentary trail as sufficient proof on a balance of probabilities, and the absence of bank statements alone cannot be used to defeat a claim that is otherwise credibly supported."

Receipts for payments

The judge further clarified that while special damages must be strictly proved, that does not mean proof beyond any reasonable doubt.

"Strict proof does not translate into proof beyond any doubt, nor does it impose the standard of proof expected in criminal cases," the court ruled.

The judge also reminded lower courts that their design is meant to deliver "expeditious, proportionate and accessible justice" without elevating "form over substance."

"This is the approach that is consistent with Article 159(2)(d) of the Constitution, which enjoins courts to administer justice without undue regard to procedural technicalities," the judge emphasised.

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The decision will be welcomed by insurers and subrogated claimants who have often struggled to produce receipts for payments made directly to service providers through credit arrangements or business-to-business settlements.

The Respondent had argued that credit notes without receipts or bank proof were insufficient, citing several authorities. However, the judge distinguished those precedents, noting they involved "bare invoices, uncorroborated estimates, or unsupported assertions" — unlike the consistent chain of documents presented by the maternity home.

The final award included Sh451,938 for repair costs, Sh44,410 for tracing fees, and Sh3,140 for re-inspection fees, plus costs and interest. The court also granted a 30-day stay of execution.

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