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ELCDismissed· [2017] KEELC 972 (KLR)

Odera Obar & Co.Advcoates v Hellen Odido [2017] KEELC 972 (KLR)

High Court of Kenya
7 November 2017
EOE. O. Obaga
1,639 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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The High Court upheld a taxing officer's Kshs.200,000 fee award, confirming that lawyers must prove every item in their bill of costs themselves.

What this practically means

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Executive summary

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This ruling determined a reference under Rule 11(2) of the Advocates Remuneration Order by Odera Obar & Co. Advocates seeking to set aside the taxing officer's decision of 24th January 2017 and to have the bill of costs remitted to a different taxing officer for fresh taxation. The underlying bill related to arbitral proceedings concerning a claim for specific performance of a contract for the sale of one acre excised from LR No. 5842/2/17, Karen, at a purchase price of Kshs.3,300,000/=; the arbitrator declined specific performance and awarded a refund of the deposit. The applicant argued the taxing officer erred in principle by fixing instruction fees at Kshs.200,000/= rather than basing them on a market survey valuing an acre in Karen at Kshs.55,000,000/-80,000,000/=, and by taxing off items for want of proof instead of invoking Rule 13A to call for documents. Obaga J applied the First American Bank v Shah standard that interference requires an error of principle or manifestly excessive fees. The court held the taxing officer exercised her discretion properly because the value of the subject matter in the arbitration could not be ascertained, the survey report was not a pleading but was introduced only through submissions, and neither party's proposed figures represented the subject matter value. On proof, the court held the applicant presenting the bill bore the burden of annexing supporting documents, endorsing Desai Sarvia & Pallan Advocates v Jambo Biscuits. The reference was dismissed with costs to the respondent.

Key legal issues

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01

Basis of instruction fees for arbitration proceedings involving specific performance of a land sale contract

Holding

The taxing officer did not err in awarding Kshs.200,000/= as instruction fees; she could not base fees on Kshs.60,000,000/= market survey figure which was not the value of the subject matter, nor on either party's proposed figures

Reasoning

The taxing officer considered that the arbitration's subject matter value could not be ascertained and exercised her discretion to award Kshs.200,000/=. The market survey figure was not a pleading but introduced only by submissions. The purchase price was Kshs.3,300,000/= and the award Kshs.660,000/=; the respondent's Kshs.1,423,175/= figure incorporated costs and was not the award. The matter was not complex, the arbitrator spending about 35 hours on it.

p. 3
02

Whether the taxing officer was obliged to invoke Rule 13A to call for documents in proof of items taxed off

Holding

No - the burden lay on the applicant presenting the bill to annex proof, particularly since proceedings arose from arbitration outside the court

Reasoning

The court held that the party presenting a bill must prove the items claimed. Attendance before the arbitrator should have been evidenced by annexing the arbitration proceedings; perusal charges by annexing correspondence. Requiring the taxing officer to prompt parties for proof would waste judicial time. The court endorsed the reasoning in Desai Sarvia & Pallan Advocates v Jambo Biscuits Kenya on the evidentiary and adversarial nature of taxation.

p. 3

Legal principles established

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  • A court cannot interfere with a taxing officer's decision unless it is shown the decision was based on an error of principle or the fee awarded was so manifestly excessive as to justify an inference of error of principle
  • It is for the party presenting a bill of costs to annex proof of the items claimed, especially for proceedings conducted outside the court; the taxing officer is not obliged to call for documents under Rule 13A

Court orders

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  1. 1.The applicant's reference is dismissed
  2. 2.Costs of the reference awarded to the respondent

Authorities

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Legislation

  • Advocates Remuneration OrderRule 11(2)
  • Advocates Remuneration OrderRule 13A
  • Advocates Remuneration OrderRule 75
  • Advocates Remuneration OrderSchedule 5

Cases cited (2)

  • First American Bank of Kenya Ltd Vs Gulab P Shah & 2 Others
    (2002) I EA 64
  • Desai Sarvia & Pallan Advocates Vs Jambo Biscuits Kenya
    (2014) eKLR
Jurisdiction invoked
Rule 11(2) of the Advocates Remuneration Order

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Odera Obar & Co.Advcoates v Hellen Odido [2017] KEELC 972 (KLR)", Case Analysis (2017). . Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2017/972/eng@2017-11-07

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.