The High Court has held businessman Samuel Kamau (SK) Macharia in contempt for disobeying orders blocking him from interfering with the management, business operations and offices of Directline Assurance Limited.
The court gave him a final opportunity to avoid sentencing by apologising and undertaking to obey future court orders in the legal dispute over control of the company.
The contempt case arose from claims that Mr Macharia had stormed the underwriter's offices at Hazina Towers, removed the chief executive officer and board of directors, and installed a new team in September 2025, in defiance of a court directive.
Businessman Samuel Kamau (SK) Macharia.
Photo credit: File | Nation Media Group
Mr Macharia and other shareholders have been fighting for control of the underwriter for more than three years. The case also involves disputed corporate control, banking transactions, enforcement of an arbitration award and competing claims over the insurer's management.
The contempt decision came in a ruling determining two separate applications: one seeking the recusal of the judge handling the matter, and another seeking the businessman's punishment for disobeying court orders.
The court dismissed Mr Macharia's recusal request, finding no evidence of bias, and allowed Directline's contempt application dated February 11, 2026.
Rejecting the recusal application, the court reaffirmed that "judges have a duty to hear a case unless there are compelling reasons for recusal."
Mr Macharia had argued that the judge had ceased being a neutral arbiter and had become a participant in the dispute. He also relied on a preliminary objection that had previously been dismissed by the court. The court rejected those arguments, finding there was "no demonstration" that it had lost objectivity or impartiality. It further held that the recusal application was an attempt to relitigate issues already forming part of a pending appeal, and that the applicant had failed to meet the legal threshold for recusal.
On the contempt application, the court examined allegations that Mr Macharia had violated earlier orders issued on October 14, 2024, restraining several defendants from hiring or terminating Directline employees, accessing company offices or property, or interfering with the insurer's management or business.
The court heard that he physically entered the company's offices and forcefully broke into the Principal Officer's office on the 19th floor of Hazina Towers. Mr Macharia went to the company's offices, indicating that Royal Credit Ltd and Samsoni PLC had terminated the directorship of the firm's board, which consisted of Tom Otieno Odongo, Maina Mwangi, Titus Karanja and Kenneth Ndura. He further installed Ms Stella Kinoti as the underwriter's head of finance, Mr Wilson Wambugu Maina as principal officer, and James Mari as head of IT.
After reviewing the material before it, the court concluded that its orders had been breached.
"It is sufficiently proved that the first defendant (Macharia) disobeyed the orders," the court said, adding that he was aware of the orders and had repeatedly been reminded to comply with them.
The contempt case arose from claims that businessman SK Macharia had stormed the underwriter's offices at Hazina Towers.
Photo credit: File | Nation Media Group
The court specifically found Mr Macharia in contempt for relocating Directline's offices from Hazina Towers and threatening members of staff with dismissal.
The judge also considered allegations that company doors had been welded shut. However, the court noted that the Officer Commanding Central Police Station had confirmed that the company officials complaining against Mr Macharia had themselves removed the welding.
Allowing the contempt application, the court found Mr Macharia guilty of the matters complained of, but stopped short of imposing an immediate sentence. Instead, the judge cited Mr Macharia's age and his description of himself as a law-abiding citizen, allowing him to purge the contempt. The court directed him to apologise and undertake not to disobey court orders or interfere with Directline until the suit is determined. The judge warned that failure to comply would result in sentencing.
The ruling marks another development in a dispute over control of Directline, one of the country's leading public service vehicle (PSV) insurers.
Directline was once a market leader, dominating commercial PSV cover — matatus and long-distance buses — and receiving over half of the industry's premiums. It was established in 1998 by John Macharia, the late son of Mr Macharia. The PSV segment covers motorists and passengers against death, injury and vehicle damage resulting from accidents.
However, Africa Merchant Assurance, which is partly owned by President William Ruto's family and associates, has since overtaken Directline, commanding a 54.71 per cent market share at the end of March this year, up from 37.51 per cent in December last year.
The case is scheduled for mention on November 18, 2026.
Directline line last year lost its market share in commercial PSVs insurance to rival Africa Merchant Assurance (Amaco), but has now reclaimed the lead.
Latest industry data from the Insurance Regulatory Authority for the first quarter of 2026 showed Directline accounted for Sh610.16 million or 62.11 percent of the Sh982.41 million premium income booked under motor commercial PSVs. The rise in Directline’s market share from 35.67 percent in a similar quarter last year placed it ahead of Amaco, whose market share declined to 21 percent from 54.71 percent.
Directline’s market share has been recovering over the past four quarters, moving to 38.4 percent in the second quarter of 2025 to 40.44 percent in the fourth quarter of the same year.
