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ELRCAllowedNot stated in the excerpt

Caroline Wanjiru Mwai v Labonte Limited & another [2021] KEELRC 32 (KLR)

Employment and Labour Relations Court
26 November 2021
948 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~4 min to read original · ~4 min brief

The bottom line

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A Kenyan court threw out a legal costs bill of Ksh.135,904 that nearly matched the Ksh.162,000 award it was based on, ordering the bill to be recalculated.

What this practically means

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Executive summary

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Maina Makome & Company Advocates, for the respondents, filed an application dated 14th July, 2021 under paragraph 11(2) of the Advocates Remuneration Order seeking review of the Taxing Officer's ruling of 2nd July, 2021, by which a Bill of Costs dated 8th May, 2020 was taxed at Ksh.135,904.60, and seeking that the bill be remitted for re-taxation before another taxing officer. The applicant contended that the taxing officer erred in principle by applying Schedule VI instead of Schedule VII, the correct schedule given the principal award of only Ksh.162,000, as required by Rule 68 of the Advocates Remuneration Rules. The claimant opposed through grounds of opposition and submissions, arguing that the reference was incurably defective because the applicant never first lodged an objection under Rule 11(1) within fourteen days of the decision. The court held that the reference was properly brought under Rule 11(2), which contemplates an application to a judge after the taxing officer's decision and reasons. Applying the principle that a taxing officer's decision will not be disturbed unless based on an error of principle or manifestly excessive fees, the court found the taxed costs of Ksh.135,904.60 against an award of Ksh.162,000 manifestly excessive and indicative of the wrong schedule having been applied. The application was allowed, the bill ordered re-taxed, and each party directed to bear its own costs. Judgment was delivered at Nairobi on 26th November, 2021 by M. Mbaru, J.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether the reference under Rule 11(2) of the Advocates Remuneration Order was properly before the court notwithstanding that no prior objection under Rule 11(1) was lodged with the taxing officer
  2. 2.Whether the taxing officer erred in principle by applying Schedule VI instead of Schedule VII of the Advocates Remuneration Order to a bill arising from an award of Ksh.162,000
  3. 3.Whether the taxed costs of Ksh.135,904.60 were manifestly excessive so as to justify the court's intervention

Key legal issues

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01

Procedural adequacy of the reference under Rule 11(2)

Holding

The application was properly brought under Rule 11(2); although no objection was first lodged under Rule 11(1), the applicant challenged the ruling and reasons via the reference, a procedure contemplated by Rule 11(2).

Reasoning

The court distinguished Rule 11(1), which requires written notice of objection within fourteen days, from Rule 11(2), which contemplates application to a judge after receipt of the taxing officer's reasons. The applicant had challenged the ruling, its reasoning and the application of Schedule VII through the present application, satisfying the Rule 11(2) procedure.

p. 2
02

Error of principle and manifestly excessive taxation

Holding

The taxed costs of Ksh.135,904.60 against an award of only Ksh.162,000 were manifestly excessive and betrayed an error of principle in applying Schedule VI instead of Schedule VII, justifying intervention.

Reasoning

Applying the First American Bank of Kenya v Shah and Haider bin Mohamed el Mandry tests, the court compared the principal award of Ksh.162,000 with the taxed costs of Ksh.135,904.60 and found the fee so disproportionate as to indicate application of wrong principles, warranting re-taxation under the correct schedule.

p. 2

Legal principles established

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  • The court will not 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 manifestly excessive as to justify an inference of error of principle.
  • Rule 11(1) requires a party objecting to a taxing officer's decision to give notice in writing within fourteen days of the items objected to.

Court orders

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  1. 1.The application dated 14th July, 2021 is found with merit and is allowed
  2. 2.The Bill of Costs dated 8th May, 2020 shall be re-taxed
  3. 3.Each party shall bear own costs

The bench

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One judgment of the whole court — no separate or dissenting opinions.

majority

Wrote the judgment

Jurisdiction invoked
Paragraph 11(2) of the Advocates Remuneration Order (reference against a taxing officer's ruling)

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

Accordingly, application dated 14th July, 2021 is found with merit and is allowed. The Bill of Costs dated 8th May, 2020 shall be re-taxed. Each party shall bear own costs.
p. 2Final orders
The court will not interfere with the taxing officer’s decision on taxation, unless it is shown that, either the decision was based on an error of principle, or the fee awarded was so manifestly excessive as to justify an inference that, it was based on an error of principle.
p. 2Test for interfering with taxation
where the instruction fee was taxed at a level so grossly excessive as to betoken the application of wrong principles, it is an occasion for a Judge to intervene.
p. 2Judge's power to intervene in taxation

Issues in the judgment

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minor

The claimant's submission cites 'Rule 1191)' which appears to be a typographical error for Rule 11(1) of the Advocates Remuneration Order.

minor

The judgment states the taxing officer's ruling was on '2nd July, 202' omitting a digit in the year.

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, "Caroline Wanjiru Mwai v Labonte Limited & another [2021] KEELRC 32 (KLR)", Case Analysis (2021). Not stated in the excerpt. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2021/32/eng@2021-11-26

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