REPUBLIC OF KENYA IN THE CHIEF MAGISTRATE’S COURT AT BUNGOMA CIVIL SUIT NO. E244 OF 2024 DOUGLAS OSUNDWA BARASA.………………………………………………..PLAINTIFF VERSUS RICHARD NJIHIA………………………………………………………………DEFENDANT SHIVJI MURJI KERAJ…………………………………………………………….3RD PARTY RULING 1. This ruling determines the Plaintiff’s Party and Party Bill of Costs dated 08th July 2026. 2. Items 3-6, 9–20, and 22 are assessed as drawn since the same were drawn to scale. Instruction Fees 3. The value of the subject matter herein is Kshs. 103,525/=. Schedule 7 of the Advocates (Remuneration) Order (ARO) provides for a minimum instruction fee of Kshs. 40,000/= for a case of this nature. 4. Considering the time taken to conclude this matter, this court assesses item 1 at Kshs. 50,000/=. Getting Up Fees 5. Item 2 is assessed off given that Schedule 7 of the ARO does not provide for getting up fees. Attendances 6. Items 7-8, and 21 are assessed at Kshs. 1,400/= each per Schedule 7 (6) of the ARO. Court Fees 7. Items 23 – 25 are assessed off since the said fees are yet to be incurred by the Plaintiff. Value Added Tax 8. The Plaintiff prayed for an award of V.A.T in the instant Party and Party Bill of Costs. 9. The costs in a Party to Party Bill of Costs are costs due to a litigant, not a counsel representing a litigant. This begs the question of whether a litigant is entitled to a claim for VAT during the assessment of their costs. This question was answered in Pyramid Motors Limited vs Langata Gardens Limited (2015)eKLR, where J.L. Onguto, J (as he then was) rendered himself thus; “On the final issue of VAT, I hold the simple view that in allowing the same the Master erred under the Value Added Tax Act, 2013 particularly section 5 thereof.
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Value Added Tax (VAT) is chargeable in taxable supply made by any registered person. There was no taxable supply of either goods or services made to the Applicant herein by the Respondent herein. The Bills herein concerned Party and Party costs and VAT could then not apply as neither party fetched nor supplied services to the other. True, legal services were rendered but it is not the Advocate who was being compensated herein. The Master could only have awarded VAT if the Bills were Advocate- Client Bills or if there was tendered evidence before the Master that the Plaintiff had paid VAT and was consequently entitled to indemnity. But yet that again is also debatable whether the Plaintiff was a vatable person. I would vacate the award on VAT as the Master erred. In the result, I would not return the Bills to the master for re-assessment but would direct that the item of VAT be completely and wholly taxed off” 10. The holding in the Pyramids Motors Limited case (supra) was also followed in Kenya Commercial Bank Limited v Stagecoach Management Limited [2017] eKLR. 11. This court’s understanding of the authorities above is that unless a party proves that it supplied taxable goods and services to the other party. V.A.T cannot be awarded in a Party and Party Bill of Costs. 12. The Plaintiff did not supply any taxable goods and services to the Defendant. The mere fact that a law firm representing a party pays V.A.T does not entitle a party to an award of V.A.T. 13. For the reasons above, the Plaintiff’s claim for V.A.T is assessed off. DETERMINATION 14. For the reasons above, the Plaintiff’s Party and Party Bill of Costs dated 08 th July 2026 is assessed at Kshs. 82,200/=. 15. However, it is noteworthy that liability in this matter was apportioned in the ratio of 50%:50% between the Plaintiff and the Defendant. 16. Note 3 under Schedule 7 of the ARO provides thus: Where success in a suit is divided, the scale may be distributed having regard to partial success on either side. 17. Given the above authority, the costs of the suit due to the Plaintiff are assessed at Kshs. 41,100/=. Read, signed and delivered in open court at Bungoma this 10th September 2026 T.O. OMONO SENIOR RESIDENT MAGISTRATE In the presence of:
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Mr. Misaro for the Plaintiff C/A: Mr. Rioba/Ms. Cherop
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