Mbugua v Kerre & 2 others

fees captured as Item 1, be taxed afresh by a dierent Taxing Ocer and / or make such appropriate orders or directions. e. That the costs of this Application be provided for. 2. The application was premised upon the grounds set out therein and supported by the adavit sworn by George Ndicu Mbugua on 7th July 2026. In summary, he deposes that the 1st and 2nd Respondents lodged their Party & Party Bill of Costs dated the 19th July 2023 in Court against him for taxation and the Taxing Ocer, Honourable Joy Mutimba, Deputy Registrar, allowed the same at Kshs. 684,966.70. He was aggrieved by the said decision with respect to the amount of Kshs. 500,000/awarded as instruction fees. 3. He was concerned with the reasons adduced by the Taxing Ocer in awarding the said sum and averred that the gure was manifestly excessive and unsupported by principles of taxation and the law. He accused the Taxing Ocer of departing from the law and arriving at an erroneous decision. He cited the case of Premchand Raichand Limited vs Quarry Services of East Africa Limited (No. 3) [1972] EA 162 and averred that the Taxing Ocer disregarded the principles set out in in that case hence arrived at a decision that had no factual or legal basis. He therefore sought that his application be granted. 4. The matter came up for directions on the application on 28th July 2026 wherein the Respondents were granted 14 days to le their response to the Reference. The Reference was to be disposed of by way of written submissions. 5. At the time of drafting this ruling, no response or submissions in respect of the Reference had been led, notwithstanding the lapse of the timelines issued by the Court for compliance. Issues for Determination 6. I have carefully read and considered the Appellant’s Application dated 7th July 2026 and the relevant legal provisions. 7. The Court discerns the following issues for determination: i. Whether the Appellant’s application meets the threshold to warrant the interference with the Taxing Ocer’s discretion in the assessment of the instruction fees. ii. Who should bear the costs of the application? Analysis and determination 8. The application is premised on Section 11 of the Advocates Remuneration Order, which provides that a person who objects to the decision of the taxing ocer may, within 14 days of receipt of the reasons for the decision, apply to a Judge by chamber summons setting out the grounds of his objection. 9. The Courts have consistently held that where the taxing ocer has delivered a comprehensive ruling setting out the reasons for the decision on taxation, the necessity to furnish reasons is thereby obviated. See the case of Evans Thiga Gaturu Advocate vs.Kenya Commercial Bank Limited [2012] eKLR and National Oil Corporation Limited v Real Energy Limited & another [2016] KEHC 7679 (KLR). 10. In this instance, the Taxing Ocer delivered a detailed ruling on the taxation in which the reasons for her determination are set out. The Court is therefore satised that the requirement for the provision of separate reasons for the decision is obviated, the ruling itself constituting the reasons for the decision. The Court notes that the Reference having been led on 10th July 2026, 9 days after delivery of the ruling, was led within the stipulated timelines. https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/6016/eng@2026-09-25 2

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11. The Court will therefore turn to the issue of whether the Reference has established the threshold for interference with the decision of the Taxing Ocer. 12. The Court in National Oil Corporation Limited v Real Energy Limited & another [2016] KEHC 7679 (KLR) outlined the circumstances under which a Judge can interfere with the Taxing Ocer’s exercise of discretion by outlining the following principles to be considered: “ These principles are, (1) that the Court cannot interfere with the taxing ocer’s decision on taxation unless it is shown that either the decision was based on an error of principle, or the fee awarded was manifestly excessive as to justify an inference that it was based on an error of principle; (2) it would be an error of principle to take into account irrelevant factors or to omit to consider relevant factors and, according to the Order itself, some of the relevant factors to be taken into account include the nature and the importance of the cause or matter, the amount or value of the subject matter involved, the interest of the parties, the general conduct of the proceedings and any direction by the trial judge; (3) if the Court considers that the decision of the Taxing Ocer discloses errors of principle, the normal practise is to remit it back to the taxing ocer for reassessment unless the Judge is satised that the error cannot materially have aected the assessment and the Court is not entitled to upset a taxation because in its opinion, the amount awarded was high;.. These principles were stated in the case of First American Bank of Kenya vs. Shah and Others [2002] 1 EA 64.” 13. In the case of Premchand Raichand Ltd and Another v Quarry Services of East Africa Ltd and Others No.3 (1972 EA 162) referred to by the applicant as cited with approval in Keziah Gathoni Supeyo v Yano t/a Yano & Co. Advocates [2019] KEHC 9959 (KLR), the Court stated as follows on the principles on taxation: ‘‘(a) successful litigant ought to be fairly reimbursed for costs he has had to incur (b) That costs be, not allowed to rise to such level as to conne access to justice to the wealthy. (c) that the general level of remuneration of advocates must be such as to attract recruits to the profession and (d) that as far as practicable there should be consistency in the awards made. (e) that there are no mathematical formulae to be used by the taxing master to arrive at the precise gure. Each case has to be decided on its merits and circumstances (f) the taxing ocer has discretion in the matter of taxation but he must exercise the discretion judiciously and not whimsically (g) the court will only interfere when the award of the taxing ocer is so high or so low as to amount to an injustice to one party.’’ 14. The question the Court has to determine therefore is whether the Taxing Ocer’s decision was based on an error of principle or the fee awarded was manifestly excessive to justify an inference that the decision was based on an error of principles or that the Taxing Ocer took into account irrelevant factors or failed to consider relevant factors. 15. The 1st and 2nd Respondents in support of their Bill of Costs dated 19th July 2023 submitted that the sum of Kshs. 900,000/= would be sucient as instruction fees as they had defended the appeal concerning the suit property which was submitted to be prime property. They also submitted that the https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/6016/eng@2026-09-25 3

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appeal had a litigation history that had spanned for 8 years and that the appeal entailed preparation of voluminous documents. 16. The Appellant in opposing the 1st and 2nd Respondents’ Bill of Costs submitted that the instruction fees ought to be pegged on the value of the subject matter. It was submitted that according to the sale agreement dated 23rd August 2010, the value was Kshs. 1,050,000/= and that per paragraph 1 Schedule VI of the ARO the fees amounted to Kshs. 91,000/=. 17. The 1st and 2nd Respondent further submitted that the sum of Kshs. 91,000/= having been based an old sale agreement was unfair. They further contended that the appeal was not a simple dispute and that its determination took one year. 18. In the impugned ruling and specically under the instruction fees, the Taxing Ocer opined that she had considered the arguments of both parties and found that the sum of Kshs. 91,000/= proposed by the Appellant was low for an appeal that involved matters regarding land rights, counterclaims, interlocutory applications as well as the professional skill and eort expended to successfully defend the appeal. 19. The Taxing Ocer found that the value of the subject matter was not ascertainable from the pleadings. She considered the sale agreement dated 2010, which indicated that the suit property had been sold for Kshs. 3,000,000/=. However, she noted that the Court had determined that the sale was unlawful and, consequently, found that she could not rely on the sale agreement for purposes of ascertaining the value of the subject matter. The Taxing Ocer further observed that as at 2022, the value of the land must have appreciated and could not, in the circumstances, be valued at Kshs. 1,050,000/=. 20. Having found that the value of the subject matter could not be ascertained from either the pleadings or the judgment, the Taxing Ocer proceeded to exercise her discretion by taking into account the work undertaken by the Advocate as reected in the Bill of Costs. She found the sum of Kshs. 500,000/= to be sucient as instruction fees and consequently taxed o Kshs. 400,000/=. 21. It is trite that, where ascertainable, the value of the subject matter is a material consideration in the assessment of instruction fees. Where such value cannot be ascertained from the pleadings, judgment or settlement, the Taxing Ocer is required to exercise her discretion in accordance with the applicable principles under the Advocates Remuneration Order. 22. The Court of Appeal in Joreth Ltd v Kigano & Associates [2002] KECA 153 (KLR) set out the principles for ascertaining the value of the subject matter for purposes of taxation as follows: “ We would at this stage point out that the value of the subject matter of a suit for the purposes of taxation of a bill of costs ought to be determined from the pleadings, judgment or settlement (if such be the case) but if the same is not so ascertainable the taxing ocer is entitled to use his discretion to assess such instruction fee as he considers just, taking into account, amongst other matters, the nature and importance of the cause or matter, the interest of the parties, the general conduct of the proceedings, any direction by the trial judge and all other relevant circumstances.” 23. The Court in Peter Muthoka & another v Ochieng & 3 others [2019] KECA 597 (KLR) observed thus: “ It seems to us quite plain that the basis for determining subject matter value for purposes of instruction fees is wholly dependent on the stage at which the fees are being taxed. Where it happens before judgment, it is the pleadings that form the basis for determining subject value. Once judgment has been entered, and for what seems to us to be an obvious reason, https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/6016/eng@2026-09-25 4

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recourse will not be had to the pleadings since the judgment does determine conclusively the value of the subject matter as a claim, no matter how pleaded, gets its true value as adjudged by the court.” 24. The taxation was undertaken after judgment had been delivered. The Taxing Ocer was therefore entitled to consider the judgment in determining whether the value of the subject matter could be ascertained. Having considered the judgment, she found that the 2010 sale agreement could not form the basis for determining the value of the subject matter, as the sale had been declared unlawful. The Taxing Ocer therefore found that the value of the subject property was not ascertainable from the judgment. She thereafter exercised her discretion, and gave reasons for awarding instruction fees of Kshs. 500,000/=. 25. The Appellant, in his Reference, has not identied any principle which the Taxing Ocer failed to appreciate or apply so as to warrant this Court’s interference with her decision. 26. The Court is satised that the Taxing Ocer gave sucient reasons for her determination and duly considered the factors relevant to the assessment of the instruction fees. There is no evidence that she took into account irrelevant factors or failed to consider relevant ones. Further, the fee awarded has not been shown to be manifestly excessive or inadequate to warrant interference. In the circumstances, no error of principle has been demonstrated and the Court nds no basis to disturb the Taxing Ocer’s discretion. The Reference therefore lacks merit. 27. On the issue of costs, Section 27 of the Civil Procedure Act provides that costs are at the discretion of the Court and that the general rule is that costs should follow events. The 1st and 2nd Respondent despite intimating that they were opposed to the application, they failed to le any response or submissions thereof within the timelines set by the court. Having so failed, they are not entitled to an award of costs of the Reference/Application. 28. Accordingly, the Appellant’s Chamber Summons dated 7th July 2026 is hereby dismissed with no orders as to costs. DATED, SIGNED AND DELIVERED VIRTUALLY VIA MICROSOFT TEAMS AT KWALE THIS 25TH DAY OF SEPTEMBER 2026. HON. E.G NDERITU L J ELC KWALE In the presence of: Mr Antony Gakaria Advocate for the Applicant Mr Gitari Advocate for the Respondents Ms Halima C/A https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/6016/eng@2026-09-25 5

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