Owiti, Otieno & Ragot Advocates v Mumias Sugar Company Limited (In Receivership) (Environment and Land Miscellaneous Application 18 of 2019)  KEELC 14756 (KLR) (15 November 2022) (Ruling)
Neutral citation:  KEELC 14756 (KLR)
Republic of Kenya
Environment and Land Miscellaneous Application 18 of 2019
DO Ohungo, J
November 15, 2022
Owiti, Otieno & Ragot Advocates
Mumias Sugar Company Limited (In Receivership)
1.Proceedings in this miscellaneous cause started on 19th March 2019 when the applicant filed its advocate – client bill of costs dated 18th March 2019. The bill was initially taxed by Hon. Lopokoiyit on 24th July 2019. The applicant filed a reference which led to the taxation decision being set aside through a ruling delivered on 22nd June 2021 by Hon. Lady Justice N A Matheka. The court ordered that the bill be taxed afresh by a different taxing officer. Ultimately, the bill was taxed afresh by Hon. R. N. Akee who delivered the ruling on 13th October 2021. The applicant was dissatisfied with Hon. R. N. Akee’s taxation as regards items 1 (instruction fees) and 2 (getting up fees) of the bill.
2.Consequently, the applicant filed Chamber Summons dated 25th October 2021, seeking orders that:1.The learned Deputy Registrar’s decision dated and delivered on 13th October, 2021 by which:a.She taxed item 1 being the instructions fees in the Applicant’s Bill of Costs dated 18th March 2019 at KShs 6,000,000.00 be set aside.b.She taxed item 2 of the Applicant’s Bill of costs dated 18th March 2019 being getting up fees at KShs. 2,000,000.00 be set aside.2.This Honourable court be pleased to direct that items 1 and 2 of the Applicant’s bill of costs dated 18th March 2019 be taxed as drawn.3.Costs of this reference be provided for.
3.The application is based on the grounds that:a.This Honourable Court, vide its ruling dated 22nd June 2021 directed that the Advocate – Client Bill of costs dated 18th March 2019, be remitted to another taxing master for taxation.b.The Learned Deputy Registrar made an error in taxing the Bill of Costs dated 1st August 2018, instead of taxing the Advocate – Client Bill of Costs 18th March 2019 as had earlier been directed by the judge of the environment and land court in a ruling dated 22nd June 2021.c.The learned deputy registrar made an error of principle in her application of Schedule 6 (1) (b) of the Advocates Remuneration Order.d.The Learned Deputy Registrar made an error of fact and law in ignoring the uncontroverted evidence that was placed before her regarding the value of the subject matter of the suit in which the services the subject of the taxation were rendered and in using a formula that cannot be explained or understood. The decision of the taxing officer on Item 1 was based on nothing and was not explained.e.The Learned Deputy Registrar erred in fact and law and committed an error of principle in picking on a figure as instruction fees arbitrarily and without any factual or legal basis. Her exercise of discretion was injudicious.f.Item 2 is directly linked to Item 1 and must be revised if the court upholds the reference targeting Item 1.
4.Despite being served, the respondent neither filed a response nor submissions.
5.The application was canvassed through written submissions.
6.The applicant filed submissions on 16th March 2022 and argued that the learned Deputy registrar was mixed up when she referred to a non-existent bill of costs dated 1st August 2018 in her ruling and that she made an error of principle in her application of Schedule 6 (1) (b) of the Advocates Remuneration Order (ARO). That there is no question that the subject suit was determined in a summary manner without going to full trial and in that regard, item 1 of the bill of costs dated 18th March 2019 was calculated on the basis that the suit was dismissed on the day it came for hearing without going for full trial. That in accordance with Schedule 6 (1) (b) of the ARO, the applicant charged 75% of the scale fees. That the misconception of the taxing officer that the matter did not go to full trial is one factor to be taken to consideration in the exercise of her discretion was wrong. That the factors that the court considers in exercising discretion are not legislated and if they were, they would cease to be matters of discretion. That the rule that requires that only 75% of the instruction fees be charged where the suit did not go to full trial is one that the taxing officer must apply once the material condition is met and that it is not a matter of the discretion of the taxing officer.
7.It was the applicant’s further submission that the learned Deputy Registrar made an error of law and fact in ignoring uncontroverted evidence placed before her regarding the value of the subject matter of the suit and that the decision of the taxing officer on item 1 was based on nothing and was not explained. That the taxing officer erred in principle in picking a figure as instruction fees arbitrarily and without any legal or factual basis and that she provided no reason at all for deciding as she did.
8.That pursuant to leave which was granted when the matter came up for taxation on 25th April 2019, the applicant filed a list of documents on 25th April 2019, a supplementary list of documents on 29th April 2019 and a further list of documents on 16th May 2019. That the documents included several emails exchanged between the parties after the primary suit against the respondent was dismissed and that in those emails, the respondent while pursuing its costs against the plaintiffs in the dismissed suit availed documents to the applicant showing the value of the properties and the mesne profits it generated from the use of the properties during the period which compensation was sought and that the learned taxing officer made no reference at all to the information availed by the respondent and consequently, she made an error of principle and exercised discretion in a manner contrary to the law.
9.The applicant argued that it is a basic principle in taxation of costs that instruction fees is determined based on the value of the subject matter and that the court allowed filing of documents regarding the value of the subject matter to guide it in deciding what to award as instructions fees. That the evidence that had been placed before the taxing officer by the respondent in the primary suit was that it made KShs 15.0 billion between February 2001 to July 2018 being the period for which the plaintiffs had sought judgement against it for mesne profits. The applicant further submitted that the respondents were given an opportunity to defend the bill but failed to and as the cardinal principle of civil proceedings, if you do not deny, you admit. That the court had no business propping up the respondent’s case.
10.While urging this court to go ahead and tax the contested items of the bill without referring it back to the taxing officer, the applicant acknowledged the general practise to remit the question of quantum for the decision of the taxing officer. The applicant relied on Court of Appeal case of Kipkorir Titoo & Kiara Advocates vs. Deposit Protection Fund Board [ 2005] eKLR and pointed out that the judge has a discretion to deal with the matter of determination of quantum himself if the justice of the case so requires. The applicant further submitted that it has lost so much time pursuing its fees and that a referral back to the taxing officer will be unjust to it and inimical to the spirit of Article 159 of the Constitution. The applicant therefore urged the court to allow the reference, set aside the decision of the taxing officer and tax items 1 and 2 of the bill as drawn. It also prayed for costs of the reference.
11.I have considered the application, the affidavit filed and the submissions. The issues that emerge for determination are whether the taxing officer applied the correct principles and whether the reliefs sought should issue.
12.In the case of Kipkorir, Tito & Kiara Advocates Vs Deposit Protection Fund Board (supra) the Court of Appeal stated:
13.A careful reading of the taxation ruling delivered by the honourable Deputy Registrar on 13th October 2021 reveals that it is stated therein that it was in relation to a bill of costs dated 1st August 2018. It seems to me that that was a minor error and nothing much should turn on it. To begin with, the ruling was preceded by an attendance at the registry on 15th July 2021 when counsel for the applicant fixed the advocate – client bill of costs dated 18th March 2019 for taxation on 6th October 2021. Come 6th October 2021, the applicant was represented before the taxing officer, the bill was argued and ruling on it was reserved for delivery on 13th October 2021. The ruling was delivered as scheduled. Further, the applicant has accepted the taxation on all items of the bill save for items 1 and 2. In the circumstances, the applicant cannot turn around and purport to disown a few parts of the ruling on such a minor dating mistake while seeking to reap the benefits of the remaining parts.
14.In the case of Joreth Limited v Kigano & Associates  eKLR, the Court of Appeal addressed the issue of determination of instruction fees thus:
15.The taxing officer in this matter herein used her discretion to assess instruction fees and gave her reasons as being that the suit was ready for trial but had been dismissed without going for full trial. The taxing officer neither identified the subject matter of the suit nor its value. A taxing officer is clothed with wide powers to make inquiry as to the subject matter of the suit and its value. These, too, should generally be determined from the pleadings, judgment, or settlement between the parties.
16.I agree with the applicant that the taxing officer erred in principle in picking a figure as instruction fees arbitrarily and without identifying the subject matter of the suit and ascertaining the value of the subject matter. Equally, the taxing officer did not offer any reasons for the failure to ascertain the value of the subject matter. Discretion alone, in the absence of reasons, cannot be the basis for picking just any figure. Discretion must be exercised judiciously. It may be that the figures that the taxing officer arrived at are the right ones or may be even quite generous to the applicant. Either way, the figures must be justified by first identifying the subject matter of the suit and then the value of the subject matter. It is only where the value of the subject matter cannot be determined from the pleadings, judgment, or settlement between the parties that the taxing officer can arrive at instruction fees largely on the basis of discretion. See Joreth Limited v Kigano & Associates (supra). In the circumstances, I find that the taxing officer did not exercise her discretion judiciously and this court can therefore interfere with and reverse the resultant decision.
17.The applicant has urged me to go ahead and tax the disputed items, arguing that referring the matter back to the taxing officer would be unjust to it and inimical to the spirit of Article 159 of the Constitution. I do not agree with the applicant. The applicant has itself acknowledged that the general practise is to remit the question of quantum for the decision of the taxing officer. See Kipkorir Titoo & Kiara Advocates vs. Deposit Protection Fund Board [ 2005] eKLR. I do not see any valid reason to warrant departing from that practice which is based on sound wisdom and accords with the demands of justice since it preserves the right of any aggrieved party to appeal against the resultant decision of the taxing officer.
18.In view of the foregoing discourse, I find merit in Chamber Summons dated 25th October 2021. I therefore make the following orders:a.The taxing officer’s decision dated and delivered on 13th October 2021 by which she taxed item 1 being the instructions fees in the applicant’s Bill of Costs dated 18th March 2019 at KShs 6,000,000.00 is hereby set aside.b.The taxing officer’s decision dated and delivered on 13th October 2021 by which she taxed item 2 of the applicant’s Bill of costs dated 18th March 2019 being getting up fees at KShs. 2,000,000.00 is hereby set aside.c.Items 1 and 2 of the applicant’s bill of costs dated 18th March 2019 be taxed afresh by a taxing officer other than Hon. Lopokoiyit and Hon. R. N. Akee.d.No order as costs of this reference.
DATED, SIGNED, AND DELIVERED AT KAKAMEGA THIS 15TH DAY OF NOVEMBER 2022.D. O. OHUNGOJUDGEDelivered in open court in the presence of:No appearance for the applicantNo appearance for the respondentCourt Assistant: E. Juma