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ELRCPartially AllowedChamber Summons dated 11.10.2017 (Reference from taxation in ELRC No. 79 of 2013)· [2018] KEELRC 2096 (KLR)

Spire Properties v Nyachoti & Company Advocates [2018] KEELRC 2096 (KLR)

Employment and Labour Relations Court
13 March 2018
OMOnesmus Makau
2,182 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court found a law firm's legal bill was inflated by errors and ordered it recalculated, saving the client money.

What this practically means

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Executive summary

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The Applicant instructed the Respondent law firm to defend her in HCCC No. 62 of 2007 (Mombasa), later transferred to the ELRC as ELRC No. 79 of 2013. The Respondent ceased acting before conclusion of the suit and filed an Advocate–Client bill of costs dated 27.6.2017 claiming Kshs.7,841,384.51; the taxing officer taxed it at Kshs.3,429,909.47. Dissatisfied, the Applicant brought this Reference by Chamber Summons dated 11.10.2017 seeking stay of execution, setting aside of the taxing officer's ruling, and re-taxation. The court framed two issues: whether the taxing officer erred in principle resulting in an excessive quantum, and what orders should issue. The court found errors of principle in three respects: failure to give credit for advance payments of Kshs.1,755,180 and Kshs.333,733 despite the Respondent advocate's affidavit admitting Kshs.1,755,180; use of the post-taxation judgment value of Kshs.58,103,973 instead of the pleaded Kshs.32,457,007 without amending the bill or hearing the parties, condemning the Applicant unheard; and award of disbursements of Kshs.52,000 per attendance without supporting receipts. A fourth ground - taxation under the wrong Remuneration Order - was dismissed as a blanket accusation. The court allowed the Reference, set aside the ruling of 29.9.2017, directed fresh taxation taking account of prior payments and verification of attendances from the primary file, and granted the Applicant costs. The stay prayer was not addressed, being overtaken by events.

Key legal issues

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01

Credit for advance fee payments

Holding

The Taxing Officer erred in principle by failing to deduct the admitted payments of Kshs.1,755,180 and Kshs.333,733 from the sum awarded

Reasoning

The Respondent's counsel admitted in an affidavit sworn on 18.8.2017 that Kshs.1,755,180 had been paid, corroborating the Applicant's claim that she made two advance payments including Kshs.333,733 paid by cheque. The Taxing Officer's finding that there was no proof of the payments was unfounded.

p. 2
02

Value of the subject matter for instruction fees

Holding

It was an error in principle to use the post-taxation judgment value of Kshs.58,103,973 instead of the pleaded value of Kshs.32,457,007 without amending the bill or hearing the parties

Reasoning

The bill was drawn and prosecuted before the final judgment. The value pleaded was Kshs.32,457,007 and was never amended. Using the judgment sum delivered after the taxation hearing, without inviting further submissions, condemned the Applicant unheard.

p. 3
03

Unproven disbursements

Holding

Awarding Kshs.52,000 per court attendance for air travel and accommodation without receipts was an error in principle

Reasoning

The Respondent produced no receipts to support the disbursements despite objection. The court relied on A. M. Kimani v Trident Insurance and P. M. Mulwa v Mavoko Municipal Council holding that disbursements cannot be awarded where receipts are not produced.

p. 3
04

Application of the wrong Advocates (Remuneration) Order

Holding

The allegation was dismissed as a blanket accusation without specifying which items were wrongly assessed

Reasoning

The Applicant alleged the Taxing Officer applied the 2014 Order to services rendered in 2007 and 2008, but did not specify which items were affected; the court therefore rejected that ground.

p. 3

Legal principles established

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  • Failure to give credit for admitted advance fee payments against a bill of costs is an error of principle
  • A taxing officer commits an error of principle by relying on a judgment value of the subject matter, delivered after the taxation hearing, without amending the bill or inviting further submissions
  • Disbursements may not be awarded in a bill of costs without supporting receipts

Court orders

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  1. 1.The Reference dated 11.10.2017 is allowed subject to the directions given
  2. 2.The Ruling by Honourable A. S. Lesootia dated 29.9.2017 is set aside
  3. 3.The Advocate–Client Bill of Costs dated 27.6.2017 to be taxed afresh taking into consideration any payments made to the Advocate before the taxation
  4. 4.The Taxing Office shall refer to the primary file (ELRC No. 79 of 2013) to verify the attendances and disallow any disbursement without supporting receipts
  5. 5.The Applicant is granted costs of the reference

Authorities

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Legislation

  • Advocates (Remuneration) Order 2009Schedule VI paragraph 1(b)
  • Advocates (Remuneration) Order 2014not specified
  • Advocates Remuneration Order 2006not specified

Cases cited (6)

  • Joreth Limited Vs Kigano Associates
    [2002] eKLR
  • A. M Kimani & Co. Advocates Vs. Trident Insurance Co. Limited
    [2016] eKLR
  • P. M. Mulwa Vs Mavoko Municipal Council
    [2009] eKLR
  • Thomas James Arthur Vs Nyeri Electricity Undertaking
    [1961] E.A. 492
  • John Mania Mburu t/a John Maina Mburu & Co. Advocates Vs George Gitari Munene (suing as Administrator of the Estate of Samuel Gitau Munene) & 3 others
    [2015] eKLR
  • D. Njogu & Company Vs Kenya National Capital Corporation
    [2005] eKLR
Jurisdiction invoked
Reference against a taxing officer's decision under the Advocates (Remuneration) Order; the underlying suit HCCC No. 62 of 2007 was transferred to the ELRC as ELRC No. 79 of 2013

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (2)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Spire Properties v Nyachoti & Company Advocates [2018] KEELRC 2096 (KLR)", Case Analysis (2018). Chamber Summons dated 11.10.2017 (Reference from taxation in ELRC No. 79 of 2013). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/2096/eng@2018-03-13

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