James Nyangiye & others v Attorney General [2020] KEELRC 789 (KLR)
The bottom line
#Kenya's Employment Court upheld apportioned legal fees in a 5,000-claimant case, but ordered a Kshs.4.2 million getting-up fee added to the costs certificate.
What this practically means
#Executive summary
#Key legal issues
#Apportionment of instruction fees in consolidated suits
The taxing officer correctly apportioned instruction fees rather than awarding separate fees for each of the 5000 Claimants.
The taxing officer relied on Rule 62 of the Advocates Remuneration Order and authority that where suits are consolidated costs including instruction fees should be apportioned so advocates are not paid twice over the same work. The court found the Claimants' proposed computation of Kshs.1,207,400,000.00 exceeded the court's award of Kshs.836,254,918.80 and would unjustly enrich them, and that apportionment balanced the parties' interests.
Omission of getting up fees from certificate of costs
The taxing officer had awarded getting up fees of Kshs.4,194,608.00 which were not included in the certificate; the certificate was reviewed and amended to include them.
The ruling of 10th December 2019 awarded getting up fees, but the certificate of costs omitted them. The court treated this as an arithmetical error warranting correction even while dismissing the substantive application.
Taxation of VAT on instruction fees in a party and party bill
The taxing officer correctly taxed off VAT on instruction fees because the Claimants adduced no evidence of having paid VAT to their advocates.
VAT is chargeable only on a taxable supply by a registered person. In a party and party bill the winning party is compensated for costs incurred, not the advocate for services rendered; VAT may be awarded only where the bill is advocate-client or there is evidence the party paid VAT and is entitled to indemnity. Following Pyramid Motors and KCB v Stagecoach, no indemnity lay here.
Legal principles established
#- Instruction fees in consolidated suits ought to be apportioned to avoid unjust enrichment of the parties.
- A winning party is entitled to recoup VAT on a party to party bill of costs only where they actually paid VAT to their advocate.
- A certificate of costs may be reviewed and amended to include an award of getting up fees omitted in error.
Court orders
#- 1.The certificate of costs is reviewed and amended to factor in the getting up fees of Kshs.4,194,608.00 as computed in the ruling.
- 2.The application is dismissed with the exception of the correction of the error on getting up fees.
- 3.Each party shall bear its own costs.
- Jurisdiction invoked
- Paragraph 11(2) and (4) of the Advocates Remuneration Order 2014
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "James Nyangiye & others v Attorney General [2020] KEELRC 789 (KLR)", Case Analysis (2020). Claimants' Chamber Summons application dated 18th December 2019. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/789/eng@2020-06-26
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.