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ELCPartially AllowedChamber Summons dated 23rd November 2010· [2017] KEELC 1946 (KLR)

Safaris Unlimited (Africa) Ltd v Muchanga Investments Limited [2017] KEELC 1946 (KLR)

High Court of Kenya
15 September 2017
SOS. Okong'o
4,891 words in judgment
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The bottom line

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The High Court ruled that lawyers' fees must be based on what a case was really about, not just numbers in the pleadings, and cut the claimed fee dramatically.

What this practically means

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Executive summary

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This judgment by Okong'o J of the High Court at Nairobi, delivered on 15th September 2017, determines a reference by the defendant under paragraph 11 of the Advocates (Remuneration) Order against the decision of the Deputy Registrar taxing the defendant's bill of costs at Kshs. 307,730/- following the striking out of the plaintiff's adverse possession suit over L.R. 3586/3. The defendant sought review of the instruction fees under item 1, taxed at Kshs. 153,454/- based on outstanding rent of Kshs. 9,507,000/-, and reinstatement of disbursements taxed off under items 64, 65, 66, 67, 69 and 71. The plaintiff raised a preliminary objection that the reference lacked the taxing officer's reasons and a certificate of taxation. The court overruled the objection, holding that the plaintiff had waived the want-of-reasons objection by consent and that no certificate of taxation is a condition precedent to a reference. On the merits, the court held the taxing officer erred in principle by using the rent as the value of the subject matter when the dispute was over ownership by adverse possession; yet the defendant also failed to prove its pleaded value of over Kshs. 2,025,000,000/-. Finding the value unascertainable, the court taxed the bill itself, setting instruction fees at Kshs. 3,750,000/- under Schedule VI(1)(ii), allowing items 64, 66, 69 and 71 as drawn, and upholding the taxation off of items 65 and 67. Costs of the reference were awarded to the defendant at Kshs. 30,000/-.

Key legal issues

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01

Error of principle by the taxing officer in valuing the subject matter

Holding

The taxing officer erred in basing instruction fees on the outstanding rent when the dispute concerned the suit property; after rejecting the pleaded value she should have gone back to the pleadings and judgment, and if unascertainable, exercised her own discretion.

Reasoning

The dispute was over ownership by adverse possession, not rent. The value of the subject matter was therefore the value of the suit property. Once the taxing officer rejected the claimed value of Kshs. 2,025,000,000/- for want of proof, she was bound to ascertain the value from the pleadings or the court's decision, and only if that failed, to exercise discretion, taking into account the nature and importance of the matter and the parties' interests.

p. 5
02

Burden of proving the value of the subject matter

Holding

The defendant failed to discharge the burden of proving that the suit property was worth in excess of Kshs. 2,025,000,000/- as pleaded in the bill.

Reasoning

Under Section 109 of the Evidence Act, the burden of proof lies on the person who wishes the court to believe in a fact's existence. The valuation reports on record were contested and the latest was over 15 years old at taxation; the question whether the property had been subdivided and its value was never determined by the court.

p. 4
03

Competency of the reference

Holding

Both limbs of the plaintiff's preliminary objection failed. The plaintiff waived objection to want of reasons by consenting to the taxing officer furnishing them, and no certificate of taxation is required before filing a reference.

Reasoning

The defendant had objected and requested reasons by letter dated 1st November 2010; the parties by consent directed the taxing officer to provide reasons after the reference was filed. Failure to obtain reasons before filing was a curable procedural irregularity causing no injustice, and the rules require no certificate of taxation as a precondition to a reference.

p. 6
04

Whether the court should remit or re-tax the bill

Holding

The court exercised its discretion to tax the contested items itself rather than remit the bill, given the age of the reference and the narrow scope of the dispute.

Reasoning

Following Kipkorir Titoo & Kiara and First American Bank, while the general practice is to remit where an error of principle is found, the judge retains discretion to deal with the matter himself where justice requires. With only seven items contested and the reference long pending, finality was preferable.

p. 6

Legal principles established

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  • A judge on a reference will not interfere with the taxing officer's discretion unless the taxing officer erred in principle in assessing costs.
  • The value of the subject matter of a suit for taxation is determined from the pleadings, judgment or settlement; failing which the taxing officer may exercise discretion.
  • The power to direct production of documents under paragraph 13A of the Advocates Remuneration Order is discretionary, not obligatory.
  • Filing a reference before obtaining the taxing officer's reasons is a procedural technicality not fatal where no injustice is caused.
  • There is no requirement that a certificate of taxation be obtained as a condition precedent to filing a reference.

Court orders

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  1. 1.The decision of the taxing officer in respect of items 65 and 67 in the bill of costs dated 10th November 2009 is upheld.
  2. 2.The decision of the taxing officer in respect of items 1, 64, 66, 69 and 71 in the bill of costs dated 10th November 2009 is set aside and in place thereof the said items are taxed as follows; i. Item 1 is taxed at Kshs. 3,750,000/-. A sum of Kshs. 22,113,500/- is taxed off. ii. Items 64, 66, 69, and 71 are taxed at Kshs. 2,748/-, Kshs.84/-, Kshs.3000/- and Kshs.696/- respectively.
  3. 3.The defendant shall have the costs of the reference assessed at Kshs. 30,000/-.

Authorities

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Legislation

  • Limitation of Actions ActSection 37
  • Advocates (Remuneration) OrderParagraph 11; paragraph 11(2); paragraph 13A; Schedule VI(1)(b)
  • Advocates (Remuneration) (Amendment) Order 2009Schedule VI(1)(b)
  • Advocates (Remuneration) (Amendment) Order, 2006Schedule VI(1)(ii)
  • Civil Procedure RulesOrder 21 Rule 9(2)
  • Civil Procedure ActSection 2
  • Evidence ActSection 109

Cases cited (9)

  • Joreth vs. Kigano & Associates
    (2002) EA 92
  • Kipkorir, Titoo & Kiara Advocates vs. Deposit Protection Fund Board
    (2005) 1 KLR 528
  • Eastland Hotel Limited vs. Wafula Simiyu & Co. Advocates
    (2014) eKLR
  • D'Sonza v Ferrao
    [1960] EA 602
  • Devshi Dhanji Naran Patel (No. 2)
    [1978] KLR 243
  • Moronge & Company Advocates vs. Kenya Airports Authority
    KSM CA 262 of 2012
  • First American Bank of Kenya Ltd vs. Gulab P Shah & Others
    (2002) 1 E.A. 61
  • Mawji –vs- Arusha General Store
    [1970] E.A 137
  • Premchand Raichand Ltd vs. Quarry Services of East Africa Ltd (No. 3)
    (1972) EA 162
On appeal from
null
null
Jurisdiction invoked
Paragraph 11 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, "Safaris Unlimited (Africa) Ltd v Muchanga Investments Limited [2017] KEELC 1946 (KLR)", Case Analysis (2017). Chamber Summons dated 23rd November 2010. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2017/1946/eng@2017-09-15

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