Festus v Inengu & another (Civil Case E171 of 2025) [2026] KEMC 616 (KLR)
The bottom line
#A Bungoma court halved a plaintiff's awarded costs to Kshs 49,592.50, ruling that court-awarded costs don't attract VAT and unproved expenses get disallowed.
What this practically means
#Executive summary
#Key legal issues
#Whether VAT is chargeable on party and party costs
VAT was disallowed because there was no taxable supply between the litigants; the costs belong to the Plaintiff, not to counsel
The court reasoned that VAT is chargeable only on a taxable supply of goods or services between parties. Here no taxable supply existed between the Plaintiff and the Defendants. The costs awarded are the Plaintiff's costs of the suit rather than the advocate's income, and so item B (VAT) was assessed off, following Pyramid Motors and KCB v Stagecoach.
Assessment of individual items of the bill
Items drawn to scale allowed as drawn; unproved items assessed off; service and attendance items taxed at prescribed ARO Schedule 7 rates
Items A, 1, 3-4, 6, 12-15, 17 and 19-26 were allowed as drawn since drawn to scale. Filing fee items 2, 5 and 4 were assessed off for want of proof. Service item 7 was taxed at Kshs. 1,400/= per Schedule 7(10)(i), item 8 disallowed as a repeat, item 9 disallowed for want of a receipt, e-mail service items taxed at Kshs. 1,400/= each, attendances at Kshs. 1,200/= and Kshs. 2,100/=, and affidavits of service at Kshs. 1,000/= each.
Effect of apportioned liability on costs
Costs reduced by half in line with Note 3 under Schedule 7 of the ARO because liability was apportioned 50%:50%
Liability in the suit had been apportioned 50%:50% between the Plaintiff and the Defendant. Note 3 under Schedule 7 of the Advocates (Remuneration) Order permits the scale to be distributed where success in a suit is divided, having regard to partial success on either side. The court therefore halved the assessed figure of Kshs. 99,185/= to Kshs. 49,592.50/= due to the Plaintiff.
Legal principles established
#- Costs of a suit due to a litigant are the litigant's costs, not counsel's income, and therefore do not attract VAT
- Where success in a suit is divided, the scale of costs may be distributed having regard to partial success on either side
Court orders
#- 1.The Plaintiff's Party and Party Bill of Costs dated 05th May 2026 assessed at Kshs. 99,185/=
- 2.Given the 50%:50% apportionment of liability, the costs due to the Plaintiff are Kshs. 49,592.50/=
- Jurisdiction invoked
- Taxation of a Party and Party Bill of Costs under the Advocates (Remuneration) Order
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Festus v Inengu & another (Civil Case E171 of 2025) [2026] KEMC 616 (KLR)", Case Analysis (2026). not stated in the ruling (Party and Party Bill of Costs dated 05th May 2026). Source: https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/616/eng@2026-07-21
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.