Azzuri Limited v Pink Properties Limited & another [2020] KEELC 1221 (KLR)
The bottom line
#A Kenyan court threw out a KSh 2.8 million legal fee award because the taxing officer ignored the mandated fee formula and gave no reasons.
What this practically means
#Executive summary
#Key legal issues
#Compliance with Rule 11 of the Advocates (Remuneration) Order - whether the 7th January 2019 letter was a valid notice of objection
The letter constituted a valid notice despite its informal format, and the preliminary objection was rejected
The court held that the purpose of a notice is to communicate information and, absent a prescribed format in law, the letter dated 7th January 2019 which clearly stated the Applicant's intention to file a reference satisfied Rule 11. Further, where reasons are contained in the taxation decision, there is no requirement to seek reasons before filing the reference. The Respondent's preliminary objection was therefore rejected.
Whether the Taxing Officer's one-paragraph Ruling allowing the Bill at Kshs 2,811,408/- was an error in principle
The Ruling was manifestly wrong and amounted to an error in principle because the Taxing Master failed to apply the Schedule VI formula for assessing instruction fees despite the Applicant's strenuous objection that the Kshs 1,600,000/- instruction fees were grossly inflated
The Applicant had objected before the Taxing Officer that the instruction fees of Kshs 1,600,000/- were grossly inflated, contending the suit was mainly a boundary dispute justifying only Kshs 75,000/-. The court held the Taxing Master should at the very least have applied the formula for assessing instruction fees under the Remuneration Order before finding the Bill reasonably drawn. Her failure rendered the decision manifestly wrong and an error in principle, warranting variation and setting aside.
Legal principles established
#- A Judge on a reference will not interfere with a Taxing Officer's exercise of discretion unless the Taxing Officer erred in principle, for example where costs allowed are manifestly excessive
- Failure by the Taxing Officer to apply the formula for assessing instructions fees specified in Schedule VI(1) of the Remuneration Order is an error in principle
- Where reasons are contained in the taxing decision, a party need not request reasons before filing a reference; and in the absence of a prescribed format, a letter communicating the intention to file a reference suffices as a notice
Court orders
#- 1.The orders of the Honourable Wandia DR dated 3rd January 2019 are set aside in their entirety
- 2.The Respondent's Party & Party Bill of Costs dated 13th September 2018 is to be placed before another Taxing Officer of the Court for fresh taxation
- 3.The Applicant shall have the costs of the Motion
- Jurisdiction invoked
- Reference from a Taxing Officer's decision under Rule 11 of the Advocates (Remuneration) Order
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (2)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Republic & 2 others v Principal Land Registrar - Kajiado & 3 others; Timothy Lantey & another (Interested Parties); Saidimu Ole Matayian & another (ExParte) [2018] KEELC 519 (KLR)[2018] KEELC 519 (KLR)18 Dec 2018
- Dennis Kamukwa Joseph v Mwando Muthengi [2018] KEELC 3301 (KLR)[2018] KEELC 3301 (KLR)30 Apr 2018
Cite this brief
#Cite this brief
Caselaw, "Azzuri Limited v Pink Properties Limited & another [2020] KEELC 1221 (KLR)", Case Analysis (2020). ELC No. 3 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2020/1221/eng@2020-09-25
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.