High Court Judge Roselyn Aburili has issued a stern warning to educational institutions and the public against use of school buses for private events.
Justice Aburili’s decision, delivered in a case involving a school bus accident, emphasises the significant legal and financial risks associated with hiring school buses for weddings, funerals, and other non-educational activities in case of an accident.
The case involves a school bus which was insured under a policy specifically designed for educational use.
The incident took place on April 23, 2023, when the school was hired to transport faithful to a church event.
This use was a direct violation of the bus’s insurance policy, which explicitly excluded coverage for passengers not affiliated with the school.
In her Judgment, Justice Aburili emphasized a common yet risky practice where schools, after buying and insuring buses for educational purposes, hire them out for private functions.
The Judge warned that this practice poses significant risk because the activities often fall outside the scope of the insurance policy.
She said institutions breach the terms of their insurance policies by using school buses for commercial purposes.
Justice Aburili noted that schools typically purchase buses and insure them for the exclusive use of students and staff but sometimes hire them out for events such as funerals, weddings, or religious functions.
During the private functions, the buses often carry individuals who are not covered under the insurance policy.
The Judge said when accidents happen under these circumstances, the insurance policy may be voided.
"This voiding of coverage leaves injured passengers or their families without compensation, as the schools involved may struggle to meet the financial demands of legal claims," she said.
She noted that it is not uncommon to see school buses, painted in their distinctive yellow colour, transporting people to various events.
"It is not uncommon, especially during crusades and other religious gatherings in this country’s major cities, to see all school vehicles lined up from all parts of the nation in their beautiful yellow colors," she said.
The plaintiff, Old Mutual General Insurance Kenya Limited, filed the suit seeking to avoid liability under their insurance policy, citing a breach of the policy terms by the defendant, Oder Boys Boarding Special School.
The key issues revolved around whether the insurance company should be liable for claims arising from an accident involving unauthorized passengers.
Old Mutual argued that the insurance policy explicitly excluded coverage for passengers who were not part of the school’s staff or student body.
On the day of the accident, the bus was involved in a collision along the Kakamega-Kisumu road, injuring several church members who were not covered by the policy.
Old Mutual contended that the insurance coverage was voided because the bus was used in a manner contrary to the policy's limitations.
The insurer’s case was clear-cut: the insurance policy was intended to cover only school-related activities. The policy’s exclusions were specific, indicating that the insurer would not cover liabilities arising from the use of the bus for purposes other than those stipulated in the policy.
The head teacher admitted that on the day of the accident, the bus was being used to transport church members, not students or staff.
He argued that while the insurance policy was valid at the time, it only covered the vehicle under conditions related to school activities.
Therefore, the school had inadvertently exposed itself to financial risk by allowing the bus to be used for a purpose not covered by the insurance.
Justice Aburili ruled in favor of Old Mutual General Insurance, declaring that the insurer was not liable to make any payments for claims arising from the accident involving unauthorized passengers. The court emphasized that the policy’s terms clearly excluded coverage for unauthorised passengers.
Her decision emphasize that compelling an insurance company to cover claims not contemplated by the policy or the law would undermine the contractual agreement and impose undue burdens on the insurer.
Justice Aburili’s ruling delves into the problematic practice of schools renting out their buses for private events.
“The insured often assumes the risks and mostly, is out of ignorance. The unauthorized passengers, on the other hand, are oblivious of the risks,” she noted.
She said that schools must strictly adhere to their insurance policies and avoid using their buses for unauthorised purposes.
"This includes refraining from renting out buses for private events without securing appropriate insurance coverage," Justice Aburili stated.
“Before hiring such vehicles, it is crucial to confirm whether the insurance policy covers passengers who are not affiliated with the school,” she added.
The Judge also called for greater transparency and diligence in understanding insurance contracts.
She ordered that the judgment be circulated to all schools through the County Directors of Education to raise awareness about the risks associated with using school buses for non-educational purposes.
“I do trust and hope that this brief judgment will be circulated to all schools in the country through the County Directors of Education to alert School Management Boards of the dangers associated with the practice,” she said.
Justice Aburili pointed out that the government invests significant amounts, ranging from Sh300 million to Sh400 million annually, in insurance for public school vehicles.
