Ktk Advocates v Sbm Bank (mauritius) Limited

5. 4. The sum awarded is manifestly excessive as to constitute an error of principle warranting setting aside of the taxing officer’s decision. 5. The taxing officer failed to consider part B of the ARO which provides that increase of the party and party costs to form the advocate and client costs is to include all proper attendances on the client and all necessary correspondence. The client urged that various items be set aside or in the alternative be assessed in accordance with the ARO or the bill of costs be remitted back to a different taxing officer for taxation. Response 6. 7. The advocate filed grounds of opposition dated 10th September 2025, on the following grounds: 1. The application is fatally defective for want of substratum, is filed in vacuo, has no statutory or legal basis. 2. The application does not establish any error of principle by the taxing officer. 3. The application does not establish that the taxation award is manifestly excessive or not in accordance with the ARO. 4. The application is false as the plaint in Mombasa HCCC No. E039 of 2022 is self-evident. The advocate also filed a preliminary objection dated 17th September 2025 against the reference on the ground that it has no legal substratum and is for striking out summarily. Submissions 8. The client asserted that there is no monetary claim in the plaint, the claim is for declarations that the securities offered by the plaintiff’s are discharged and for instructions restraining the respondent from realizing the securities. It also pointed out that the amount owed was not challenged by the plaintiffs. 9. The client argued that the value of the subject matter was not ascertainable from the pleadings. It contended that since the outstanding debt was not being challenged, it could not be considered as the value of the subject matter. It highlighted that the suit is still pending before the High Court at Mombasa. It complained that the value of the subject matter according to the advocate is not derived from the pleadings, judgment or settlement. 10. The client contended that the taxing officer also erred in principle by awarding the advocate full instruction fees even though the advocate did not represent the client until judgment was delivered. It pointed out that the advocate ceased acting for the client before the matter was set down for hearing. 11. The client asserted that the taxing officer erred in principle by allowing various correspondence and attendance items which are included in the increase of the party and party costs under schedule 6 Part B of the ARO. 12. The client asserted that the taxing officer did not set out the complexity, novelty, responsibility, industry, skill or urgency demonstrated by the advocate that would justify the sum awarded. 13. The client relied on: 1. Joreth Limited v Kigano & Associates [2002] 1 EA 92 2. Kamunyori & Co Advocates v Development Bank of Kenya Ltd [2015] eKLR=Dari Limited & another v East African Development Bank & 3 Others [2025] KEHC 8721 (KLR) https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/7169/eng@2026-04-16 2

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3. Meyers & Another v Hamilton & others [1975] EA 13 4. First American Bank of Kenya Ltd v Gulab P. Shah & 2 others [2002] KEHC 1277 (KLR) 5. Kenya Airports Authority v Otieno Ragot and Company Advocates [2024] KESC 44 (KLR) 6. Republic v Minister for Agriculture & 2 Others Ex-parte Samuel Muchiri W’Njuguna & 6 Others [2006] KEHC 3504 (KLR) 14. The advocate challenged the client’s proposition that instruction fees should be assessed at Kshs. 1,500,000/-. It submitted that the value of the subject matter is set out clearly in the pleadings as Kshs. 38.9 Billion. It also submitted that the value is not speculative but based on contracts. 15. The advocate challenged the client’s objection to the assessment of the other items on grounds that they did not include all, terming it spurious. It faulted the client for not giving an alternative method of assessment. 16. The advocate urged the court to dismiss the reference and to allow its application for entry of judgment. 17. The advocate relied on: 1. Owners of The Motor Vessel "Lillian S" v Caltex Oil (Kenya) Limited [1989] KLR 1 2. Machira & Co. Advocates v Magugu [2002] 2 EA 428 3. Otieno Ragot Company Advocates v National Bank of Kenya Limited [2020] KECA 894 (KLR) 4. JA Guserwa & Co. Advocates v Uzuri Foods Limited Nairobi ELR Misc. Appl. No. E078 of 2025, [Unreported] 5. Nairobi HC C & HR Misc. Appl. No. 33 of 2019, Maina & Maina Advocates v Benedict Kabugi Ndungu [Unreported] 6. Nairobi Civil Appeal No. 199 of 2002, Machira & Co. Advocates v Arthur K. Magugu & Ano. [Unreported] 7. Nairobi HC Misc. Civil Case No. 52 of 2012, Lubulellah & Associates Advocates v N.K. Brothers Limited [Unreported] 8. Kakamega HC Misc. No. E07 of 2020, Teddy Mulehi Monyo & 2 Others v Peter Gicharu Ngige [Unreported] 9. Machakos HC Misc. Reference No. E047 of 2020, Joseph Tamata Advocates v Mary Nthambi Mbuvi [Unreported] 10. Kenya Airports Authority v Otieno Ragot & Co. Advocates (Petition Eo11 of 2023) [2024] KESC 44 (KLR) 11. Kisumu Civil Appeal No. 37 of 2007, George Arunga Sino t/a Jone Brooks Consultants Limited v Patrick J.O. & Geofrey D.O. Yogo t/a Atieno Yogo & Co. Advocates [Unreported] 12. Nairobi HC Misc. Cause No. 719 of 2009, Lubulellah & Associates Advocates v Airtime Business Solutions [Unreported] 13. Nairobi HCCC No. 2255 of 2000, First American Bank of Kenya Ltd v Gulab P. Shah & Others [Unreported] https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/7169/eng@2026-04-16 3

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14. Siaya HC Misc. Ref. Appl. No. E019 of 2022, Fredrick Onyango Aoro v Mary Auma Were [Unreported] 15. Joreth Limited v Kigano & Associates, Nairobi Civil Appeal No. 66 of 1999 [Unreported] 16. Nairobi Civil Appeal No. 240 of 2011, Hon. Daniel Toroitich Arap Moi, CGH v Mwangi Stephen Muriithi & Ano. 17. Evans Thiga Gaturu Advocate v Kenya Commercial Bank Limited, Nairobi HC Misc Appl. No. 343 of 2011 [Unreported]. Analysis and Determination PO 18. The advocate’s PO against the reference is premised on the ground that it has no legal substratum and is for striking out summarily. 19. The client asserted that the advocate does not explain in the PO why the reference lacks legal or statutory substratum or why it ought to be struck out. 20. A PO should be clear and tacit in substance of what it claims without much probing. Mukisa Biscuit Manufacturing Co. Ltd v West End Distributors Ltd [1969] EA 696. 21. I have considered the PO. However, it is not discernible from the PO why the reference lacks legal or statutory substratum or why it ought to be struck out. 22. The power to strike out pleadings ought to be exercised sparingly as it may lead to grave injustice. DT Dobie & Company (Kenya) Limited v Muchina & another (Civil Appeal 37 of 1978) [1980] KECA 3 (KLR) (18 March 1980) (Judgment) 23. Thus, the call to strike out the reference must be supported well and deserved. 24. Therefore, the court finds that the PO is not merited. 25. The central issue is whether the taxing officer erred in principle by awarding 1,016,958,921.00 without indicating how she ascertained the value of the subject matter. 26. The client asserted that value of the subject could not be ascertained from the pleadings and that therefore, the value of the subject matter was not ascertainable. It highlighted that there was no monetary claim sought by the plaintiffs, rather they sought declarations that the securities were invalid. 27. The client highlighted the scope of the work done by the advocate, noting that the advocate ceased acting before the matter was set down for hearing. It also pointed out that the suit is pending determination, hence no judgment or settlement from which the value of the subject matter could be ascertained. 28. The advocate submitted that the value of the subject matter is set out clearly in the pleadings as Kshs. 38.9 Billion. 29. The advocate sought Kshs. 600,000,000 in instruction fees based on the value of the subject matter of Kshs. 38,938,125,000/- (USD 237,500,000/-). 30. The taxing officer found: “ The value of the subject matter is Kshs. 38,938,125,000/- https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/7169/eng@2026-04-16 4

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Schedule 6(1) (b) Fee for Kshs. 1,000,000 is Kshs. 120,000/= Fees for 20M is fees for 1 million plus an additional 2% The fee for the subject matter above 20M is a fee for 20 million plus an additional 1.5% 120,000 + (19,000,000×2%) + (38,918,125×1.5%) =584,271,875/= Kshs. 15,728,125/= is taxed off.” 31. In Joreth Ltd v Kigano & Associates, the court found that: “ …the value of the subject matter of a suit for 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 officer is entitled to use his discretion to assess such instruction fee as he considers just, taking into account, among other matters, the nature and importance of the cause or matter, the interest of the parties, general conduct of the proceedings, any direction by the trial judge and all other relevant circumstances.” 32. It is not in dispute that the suit is pending and that the advocate ceased acting before the suit was set down for hearing. What is in contest is whether the subject matter of the suit is ascertainable. 33. The law is that the value of the subject matter is ascertained from either the pleadings, judgment or settlement depending on the stage the matter is in. Kenya Airports Authority v Otieno Ragot and Company Advocates [supra] 34. Since, the matter is pending, the value ought to be ascertained from the pleadings. 35. The client argued that the value could not be ascertained from the pleadings. On the other hand, the advocate asserted that the value could be ascertained from the plaint as the underlying securities were based on contractual value. 36. I have read the plaint dated 14th June 2022. Page 10 thereof contains the plaintiff’s prayers. There was no monetary claim. They sought to be discharged from the securities and the permanent injunctions to restrain any enforcement action or interference with the charged properties. 37. Thus, I am inclined to agree with the client that the subject matter was not ascertainable from the pleadings. The securities or contracts are not pleadings. Therefore, the taxing officer erred in principle by basing her assessment on Kshs. 38,938,125,000/- (USD 237,500,000/-) as the value of the subject matter. 38. I also find that the award was manifestly excessive. 39. The taxing officer ought to have exercised her discretion in accordance with the principles in Kenya Airports Authority v Otieno Ragot and Company Advocates [2024] KESC 44 (KLR) in assessing the costs. 40. The client has demonstrated that the taxing officer erred in principle and that the award is manifestly excessive to warrant the court’s interference. First American Bank of Kenya Ltd v Gulab P. Shah & 2 others [supra] https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/7169/eng@2026-04-16 5

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41. It is therefore appropriate for the instruction fees and other items challenged to be re-taxed by a different taxing officer. Disposal 42. In the upshot, the client’s reference dated 8th September 2025 is allowed, in the following terms: 1. The taxation ruling dated 25th August 2025 is set aside. 2. The advocate-client bill of costs dated 30th January 2014 is remitted for taxation before a different taxing officer. 3. The advocate’s application is dismissed with no orders as to costs because, by this ruling, it became premature. DATED, SIGNED AND DELIVERED AT NAIROBI THROUGH MICROSOFT TEAMS ONLINE APPLICATION THIS 16TH DAY OF APRIL, 2026 ------------F. GIKONYO M JUDGE In the presence of: Kiragu/ Ondieki for client Simiyu for Kipkorir CA – Ivan/Aggrey https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/7169/eng@2026-04-16 6

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