E. A. Building Society Limited v A.C.A. D'souza & another [1998] KECA 193 (KLR)
The bottom line
#Kenya's Court of Appeal ruled a judge went too far by adding VAT to taxed costs when that issue was never raised, and set the VAT award aside.
What this practically means
#Executive summary
#Key legal issues
#Scope of a single Judge's powers on a Rule 109(2) reference
The single Judge exceeded his jurisdiction by deciding the VAT question, which was a matter of law or principle requiring a Rule 109(1) reference, not a Rule 109(2) reference on manifest inadequacy
The respondents' reference was made under Rule 109(2), which confines the Judge to deciding whether the bill as taxed is manifestly excessive or inadequate and permits addition or deduction to render it reasonable. Whether VAT is awardable on taxed costs is a question of law or principle, which only arises under Rule 109(1). The respondents made no cross-reference on VAT, so the Judge was not entitled to resolve it, and doing so amounted to taking into account an irrelevant point or failing to take into account a relevant point.
Whether VAT is automatically awardable on taxed costs
Left open; the court expressly declined to decide the question, noting no law specifically provides for automatic award of VAT on taxed costs
The court observed that, as far as it was aware, no law specifically provides that VAT is to be automatically awarded on taxed costs, but because the issue was not properly raised before the single Judge, the full court would not determine it. The question was reserved for another occasion when properly raised.
Legal principles established
#- A single Judge's decision on a taxing-officer reference binds the full court unless the single Judge took into account an irrelevant fact, failed to take into account a relevant fact, or misapprehended the law
- A Judge on a Rule 109(2) reference may only decide whether a taxed bill is manifestly excessive or manifestly inadequate, and may not determine questions of law or principle not properly raised before him
Court orders
#- 1.The application to the full court under Rule 109(5) is allowed
- 2.The order of the single Judge imposing VAT at 15% on the taxed costs is set aside
- 3.Costs of the application awarded to the applicant
- On appeal from
- High Court of Kenya at Mombasa (decision of single Judge Shah, JA)
- H.C.C.C. No. 155 of 1994 (consolidated with H.C.C.C. No. 156 of 1994)
- Jurisdiction invoked
- Rule 109(5) of the Court of Appeal Rules - application to the full court to vary, discharge or reverse a decision of a single Judge
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (4)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Sehmi v Sehmi & 4 others (Environment and Land Case 659 of 2017) [2026] KEELC 1932 (KLR)[2026] KEELC 1932 (KLR)19 Mar 2026
- Kariankei v Nkoitiko (Environment and Land Miscellaneous Case E001 of 2025) [2025] KEELC 7938 (KLR)[2025] KEELC 7938 (KLR)13 Nov 2025
- Mathenge & another v Belle Holdings Limited & 2 others[2023] KEELC 15942 (KLR)8 Mar 2023followed
- Ajitsinh Dayal & Another (suing on behalf of the Plaintiff Company) v. 1st Defendant (Landlord) & 2nd Defendant (Auctioneers)[2009] KEHC 190 (KLR)14 Dec 2009
Cite this brief
#Cite this brief
Caselaw, "E. A. Building Society Limited v A.C.A. D'souza & another [1998] KECA 193 (KLR)", Case Analysis (1998). Civil Appeal (Application) No. 59 of 1996. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/1998/193/eng@1998-08-28
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.