[2021] KEELC 4508 (KLR)

REPUBLIC OF KENYA

IN THE ENVIRONMENT AND LAND COURT AT KITALE

ELC MISC. APPL. NO. 16 OF 2020

ELDORET EXPRESS LIMITED..............................APPLICANT

VERSUS

MARTIN NYONGESA....................................1ST RESPONDENT

GEORGE NATEMBEA..................................2ND RESPONDENT

TAWAI LIMITED...........................................3RD RESPONDENT

RULING

The Application

1. By an application dated 15/10/2020 and filed in court on 22/10/2020, brought under Rule 11(2)of theAdvocates Remuneration Order, the applicant seeks the following orders:

(a) That this application be certified urgent and heard on priority basis.

(b)That this honourable court be pleased to set aside in its entirety the Ruling on Taxation delivered by Honourable Lubia in Kitale ELC No. 7 of 2018 on 30/9/2020.

(c)That upon setting aside the same, this court be pleased to tax the defendants’ Bill of Costs dated 30/9/2019, 18/6/2019 and 25/6/2019 or order it to be re-taxed before a different taxing master.

(d)That costs of this reference as well as those of the taxation proceedings be borne by the respondents.

2. The application is supported by affidavit dated 15/10/2020 attached to the application and a supplementary affidavit filed on 25/11/2020. Both are sworn by James Muigai Thungu, one of the directors of the applicant. The grounds on which the application is premised are that the suit did not proceed to hearing as the 3rd defendant successfully raised a preliminary objection which disposed of the suit; that the value of the subject matter could not be ascertained from the pleadings; that nevertheless the taxing master issued a ruling on the taxation putting the party and party costs at Kshs. 2,044,200/- for the 1st defendant’s bill and Kshs. 2,039,475/- in respect of the 2nd defendant’s bill of costs and Kshs. 2,039 ,475 for the 3rd defendant’s bill.

3. It is claimed that the taxing master ignored the submissions of the plaintiff and failed to state reasons in her ruling and delivered the ruling in the absence of all the parties in the matter and that this occasioned a miscarriage of justice in the course of the taxation. It is alleged that the applicant’s advocate only learnt of the ruling upon receipt of the 2nd respondent’s advocate’s letter notifying him of the same.

The Response

4. In his response to the application the 1st respondent filed a replying affidavit sworn by his advocate on 4/11/2020. His response is that the applicant’s suit was struck out on the doctrine of res judicata; that the land undisputedly measures 640 acres; that the counsel secured a valuation of the land to support the instruction fee sought; that the taxing master disregarded that report and granted Kshs. 2,000,000/- as instructions fees; that the dispute brought in 4 new parties thus making it complex; that the applicant has failed to follow the laid down procedures before lodging the application in that no notice was issued to the taxing master or reasons for the decision sought. It has been stated that the applicant has failed to demonstrate that the taxing master exercised her discretion wrongly or in an unfair manner. Further he states that the applicant has attached an unauthenticated copy of the impugned ruling which this court should not rely on. He urges the court to strike out the reference.

5. The 2nd respondent filed a replying affidavit sworn on 5/11/2020. He objects to the application on the basis that it offends the provisions of rules 11(1)and11(2) of the Advocates Remuneration Order; that it was filed out of time; that no notice of the items objected to has been given to the taxing master and so the applicant has not exhausted the required process before approaching this court.

6. The 3rd respondent filed a replying affidavit sworn by his advocate on 4/11/2020. His response is that there is no valid application on record as rule 11(2) of the Advocates Remuneration Order has not been observed; that no reasons for the ruling were sought and received from the taxing master before the application was lodged; that the taxing master exercised her discretion properly correctly and judiciously and the court should be reluctant to interfere with her exercise of discretion.

7. The 3rd respondent also urges the court to hear the reference simultaneously with its application for judgment on costs dated 4/11/2020.

8. A preliminary objection was lodged on 5/11/2020by the 3rd defendant and it specifically raised the following grounds:

(1)That the application is fatally incompetent and offends mandatory Rule 11 (1) and (2) of the Advocates Remuneration Order being the ruling filed out of statutory timelines.

(2)That the applicant offending the said Rules the court has no jurisdiction to entertain the application whose fate is for dismissal.

9. The 3rd respondent prays that the application dated 15/10/2020 be struck out with costs.

10. The court directed that the Reference to be disposed of by way of written submission and the respondents’ submissions to incorporate submissions on the preliminary objection dated 4/11/2020. The applicant filed his two separate sets of submissions on its application and on the preliminary objection on 22/1/2021. I have perused the court record and I have found no submissions filed on behalf of the 1st respondent. The 2nd respondent filed his submissions on 15/1/2021 while the 3rd respondent filed its submissions on 21/12/2020. I have considered the application, the response and the filed submissions.

11. The issues that arise for determination in the instant application are as follows:

(a) Whether the application is fatally incompetent and offends mandatory Rule 11 (1) and (2) of the Advocates Remuneration Order for being filed outside the statutory timelines.

(b)Whether grounds exist to enable this court set aside the ruling on taxation and either tax the defendants’ bills itself or order a taxation before a different taxing master.

(c)What orders should issue on the 3rd respondent’s application dated 4/11/2020?

(d)Who should bear the costs of the reference and the taxation proceedings and the 3rd respondent’s application dated 4/11/2020?

12. The issues are addressed as hereunder:-

(a) Whether the application is fatally incompetent and offends mandatory Rule 11 (1) and (2) of the Advocates Remuneration Order for being filed outside the statutory timelines

13. This issue is raised by all the respondents as a preliminary issue. The 2nd and 3rd respondents filed a notice of preliminary each on the point. The cumulative argument by all the respondents is that the provisions of rule 11 of the Advocates Remuneration Order are mandatory and give no room for derogation. It is urged that the applicant had to file the reference within 14 days from the date of the ruling and to give the taxing master a notice seeking reasons for and objecting to the taxation of, particularized items.

14. The 2nd respondent alleges that the applicant was aware of the ruling of the taxation master on the taxation yet it opted not to comply with rule 11. In the circumstances, he submits, extension of time, leave of court to file a notice of objection against the taxing master’s decision and leave to file a reference was necessary prerequisites prior to the lodging of the reference in the circumstances yet the applicant has not sought these orders.

15. Citing the decision in County Assembly Of Kisumu & 2 Others Vs Kisumu County Assembly Service Board & 6 Others [2015] eKLR, the 3rd respondent powerfully argued that under Article 159 the court has a duty to enforce the law and that the court should be guided by the national values and principles under Article 10 while pronouncing itself in a judgment or ruling.

16. The 3rd respondent also relied on the decision in The Speaker of The National Assembly Vs James Njenga Karume Civil Application No. Nai 92 of 1992; Waiganjo Wachira & Co. Advocates Vs Pacis Insurance Company Ltd [2020] eKLR, Ufundi Cooperative Savings and Credit Society Vs Njeri Onyango & Co Advocates [2015] eKLR;andMoses Mwicigi & 14 Others Vs Independent Electoral and Boundaries Commission & 5 Others [2016] eKLR.Basing itself on these decisions the 3rd respondent’s submission is that a party must exhaust the procedure laid out by the law before approaching the court. This court has considered those decisions in preparing this Ruling.

17. The applicant’s submissions addressed this issue citing the decision in Muri Mwaniki & Wamiti Advocates Vs African Banking Corporation Ltd [2020] eKLR as quoted in Ahmednassir Vs National Bank of Kenya Ltd 2006 EA, and Evans Thiga Gaturu vs Kenya Commercial Bank Ltd [2012] eKLR. It is urged that reasons were given in the impugned ruling dated 30/9/2020 and that where reasons have been provided in the taxing master’s ruling there would be no need to ask for the reasons before filing the reference; therefore, submits the applicant, the reference was filed within time and it does not offend the provisions of rule 11(1).

18. The provisions of that rule read as follows:

11. Objection to decision on taxation and appeal to Court of Appeal

(1)Should any party object to the decision of the taxing officer, he may within fourteen days after the decision give notice in writing to the taxing officer of the items of taxation to which he objects.

(2)The taxing officer shall forthwith record and forward to the objector the reasons for his decision on those items and the objector may within fourteen days from the receipt of the reasons apply to a judge by chamber summons, which shall be served on all the parties concerned, setting out the grounds of his objection.

19. I have noted that rule 11 (1) on a plain reading states that the proper course a party should take if he objects to a decision of the taxing master is to issue a notice to the taxing master of the items in the bill to which he objects. There is no provision stating that the objector needs seek reasons though there is no provision barring the seeking of the taxing master’s reasons for the decisions on those items in such a notice. However whether reasons are sought or not rule 11(2) seems to oblige the taxing master to give reasons for the decisions on the impugned items. It is the case as urged by the applicant supported by the decision in Muri Mwaniki & Wamiti Advocates Vs African Banking Corporation Ltd [2020] eKLR that in many instances the ruling delivered by the taxing master may contain the reasons and thus the applicant is correct to state that there would be no need to ask for reasons in the present instance where in its opinion reasons were given in the impugned ruling.

20. It is also provided in rule 11(2) that the objector may within 14 daysof receipt of the reasons apply to court setting out the grounds for the objection.

21. It would appear that in an ordinary case where notice has been given to the taxation master the period within which to lodge a reference is expressly extended by 14 days from the date of receipt of the taxing master’s reasons. The applicant’s refuge lies in that reasons were contained in the taxing master’s ruling and a request therefore was not necessary.

22. In this court’s view the notice is meant to alert the taxing master that there is an objection, and where no reasons have been given, to request for reasons. I agree with the dicta in Muri Mwaniki & Wamiti Advocates Vs African Banking Corporation Ltd [2020] eKLRcited by the applicant to the effect that “…the said rule was not intended to be ritualistically observed when reasons for the disputed taxation are already contained in the formal and considered ruling.” Therefore in this court’s conclusion there was no need to issue a notice and the applicant was at liberty to file a reference.

23. The foregoing necessarily raises the question as to whether in the absence of need to request for reasons the of 14 days in rule 11(1) and the further 14 days in rule11(2) should be considered cumulatively so as to allow an objector not needing to seek reasons a maximum of 28 days within which to file a reference.

24. In this court’s view no law should be allowed to be discriminatory in its effect.

25. That an objector may by his own act of needlessly seeking reasons for a ruling when the same are in the ruling automatically entitle himself a further 14 days - or an indefinite period under rule 11(2), depending on how long the taxing master takes to respond - within which to file a reference while another who does not seek reasons when they are in the ruling is deemed to have filed a reference out of time if he files it outside the 14 day period in rule 11(1)sounds discriminatory to me. In this court’s opinion it is high time rules 11(1)and11(2) were re-evaluated with a view to amendment in order to reflect a more just and equitable effect on all objectors, whether reasons are contained in the taxing master’s ruling or not.

26. From the foregoing this court is of the view that owing to the construction of rule 11 (1)and(2) of the A.R.O., the lodging of a reference within the 28 days cumulatively provided by rules 11(1)and11(2) is in order and that the failure to give notice to or ask for reasons from the taxing master was not fatal to the reference before me and this court therefore has jurisdiction to hear and determine this reference. The 3rd respondent’s notice of preliminary objection is therefore dismissed on those grounds.

27. This court will now delve into the merits of the reference dated 15/10/2020.

(b) Whether grounds exist to enable this court set aside the ruling on taxation and either tax the defendants’ bills itself or order a taxation before a different Taxing Master

28. The applicant appears to object to the entire taxation.

29. I agree with the submission by the 3rd respondent that save in exceptional cases a judge does not interfere with the assessment of what the taxing officer considers to be a reasonable fee save where it thinks that the award is so high or so low as to amount to an injustice to a party in the proceedings.

30. The brief point to be examined in the instant application therefore is whether, as alleged by the applicant, the decision of the taxing master is sufficiently high as to amount to an injustice to the applicant in the circumstances of the case.

31. The applicant’s grounds for seeking an order setting aside the taxation are that the subject matter could not be ascertained from the proceedings and the pleadings, that the suit sought mere declarations and injunctions, and that the matter did not proceed to hearing. I have not heard the respondents to effectively controvert this position. The closest the 3rd respondent came to doing so is his averment that the acreage of the land was stated but in my view that averment never showed that the precise value of the subject property could be deciphered from the pleadings and the proceedings. I must therefore resort to a perusal of a copy of the amended plaint which is the only pleading the 3rd respondent commendably exhibited to his replying affidavit dated 4/11/2020.

32. The amended plaint sought the following prayers:

(a) A permanent injunction against the defendants’ interference with the land;

(b)An order restraining the 5th and 6th defendants from interfering with the land by subdivision or any dealings;

(c)A declaration that subdivision was illegal fraudulent and a nullity;

(d)A declaration that the process leading to the issuance of provisional certificate of title was illegal fraudulent and a nullity;

(e)An order that the issuance of a provisional certificate be cancelled;

(f)An declaration that the revival re-registration and taking over of Tawai (1974) Ltd by some of the defendants was illegal fraudulent and a nullity;

(g)A declaration that the incorporation of Tawai Ltd on 17th September 2005 was illegal fraudulent and a nullity;

(h)An order deregistering Tawai Ltd;

(i) Costs of the suit;

(h) Any other relief.

33. It is quite apparent that the taxing master had nothing in the form of a consensually prepared valuation report or other document to guide her on the value as she taxed the bill; all she had was a unilaterally acquired valuation report cited by the counsel for the 1st respondent.

34. Before the taxation master the argument was advanced by counsel for the applicant that the claim was not for ownership of land but principally for injunctive orders and the instruction fee should be Kshs. 75,000/-.

35. The taxing master in her ruling observed that the value of the subject matter could not be ascertained from the pleadings and proceedings. She also concurred that it is not a claim for ownership of the land and relied on R. Billing & Co. Advocates vs Kundan Singh Construction Ltd 2002 eKLR. I agree with those two observations. However what aggrieves the applicant is that she awarded an instruction fee of Kshs. 2,000,000/- for each of the respondents. The taxing master having found that the claim before court was not for ownership but for injunctive and declaratory relief, was the award of the instructions fee proper?

36. In this court’s view the taxing master’s decision was proper only in so far as the taxing master did not rely on the value of the subject matter, having directed herself properly in accordance with the decision in R. Billing & Co Advocates vs Kundan Singh Construction Ltd 2002 eKLR. (Supra). However when it come to the taxing master’s decision to award the instruction fee, must subjected to deeper scrutiny against the provisions of the Advocates Remuneration Order (A.R.O.) in so far as injunctions and declarations which was the subject matter of this suit, are concerned, for her award may only be adjudged as proper or reasonable based only on the provisions of the A.R.O. as a yardstick.

37. Upon a perusal of the Advocates Remuneration Order, I find that the matter at hand fell under Schedule 6 paragraph 1 (j), under the heading “Other matters.”The same provides as follows:

“Other Matters

To sue or defend in any case not provided for above; such sum as may be reasonable but not less than -

(i) If undefended ………………………….45,000

(ii) If defended……………………………..75,000”

38. It is apparent that the subject suit having been defended the minimum fee applicable under the paragraph replicated in part above was Kshs. 75,000/-, and any variation of the same on an incremental scale on the basis of any complexity of the matter would have to be reasonable and based on that amount as the starting point.

39. Having observed as much was the taxation master’s award of Kshs. 2,000,000/= as instructions fees to each of the 3 respondents reasonable or justified?

40. The taxing master must be credited with having observed that the matter was dismissed at a preliminary stage and that several applications had been filed and various pleadings had been exchanged between the parties and declined to award a getting up fee for the reason that the matter did not proceed to full hearing and counsel did not demonstrate that they had actually prepared for trial. However even to compensate for the complexity of the matter, Kshs. 2,000,000/- was quite a humongous amount to award as instructions fees compared to the starting point of Ksh 75,000/- provided for under Schedule 6 paragraph 1 (j), under the heading “Other matters.”In this court’s view there would have to be a proper justification to award an instruction fee of Kshs. 2,000,000/- which is in excess of twenty times the minimum amount provided in the A.R.O. and in the instant dispute, such proper justification was not provided by the taxing master in her ruling dated 30/9/2020.

41. In the circumstances this court holds that such an award had no proper foundation and that it is so high that it amounts to an injustice to the applicant.

42. This court has been asked to either tax the bills or to order a taxation by a different taxing master. I have considered that not much substance has been raised by the applicant over the specific items listed down in the bills of costs except the instruction fees. In my view the applicant appears not truly aggrieved by the other items otherwise a substantive argument would have been raised in respect of each. Therefore, this court must only confine itself to the instruction fees, and it has already substantially dealt with the instruction fee and expressed an opinion thereon in the course of this ruling.

43. Though the 3rd respondent powerfully argues against the court taxing a bill of costs, this is one of the occasions in which very little in terms of discretion will be left to the taxing master as the fresh taxation, perchance it is ordered to be conducted by another taxing master, would have to be conducted in accordance with this court’s opinion herein as the guideline; also, only one item, the instruction fee is affected by this reference, hence shuffling this file record to another taxing master in the court below appears to this court to be needless. This court is in the circumstances compelled to tax the bill of costs and bring the dispute to an end and occasion the parties some reprieve from possible re-litigation in another court.

44. Basing myself on Schedule 6 paragraph 1 (j), under the heading “Other matters”and while upholding the taxing master’s opinion rejecting the getting up fee, I find that the respondents herein are entitled to Kshs. 75,000/- as the basic instruction fee. In addition this court must factor in an increment to that amount on the basis of complexity of the matter, bearing in mind the raft of orders sought by the applicant in the original suit, and for this complexity I award the respondents Kshs. 25,000/-being a third of the basic instruction fee I have awarded. The total sum I award shall therefore be Kshs. 100,000/- in terms of the instruction fee. The taxing master’s award on the rest of the items other than the instruction fee in all the 3 bills of costs shall remain unaltered.

45. For the avoidance of doubt, the decision of the taxing master in her ruling dated 30th September 2020 is hereby vacated and set aside partially only in so far as the instruction fee is concerned. The amount awarded to each respondent by the taxing master as instruction fees is hereby vacated and substituted with a sum of Kshs.100,000/- for each of the three respondents. The final amounts awarded by taxing master by this court as party and party costs to the respondents upon the re-taxation of their bills of costs by this court shall therefore be as follows:-

1st Defendant’s Bill of Costs dated 30/9/2019

Instruction fees: …………………………. Kshs. 100,000/-

Other items in the bill …………………... Kshs. 44,200/-

Total …………………………………..... Kshs. 144,200/-

2nd Defendant’s Bill of Costs dated 18/6/2019

Instruction fees: ………………………….. Kshs. 100,000/-

Other items in the bill …………………… Kshs. 39,475/-

Total ………………………………....….. Kshs. 139,475/-

3rd Defendant’s Bill of Costs dated 25/6/2019

Instruction fees: ………………………….. Kshs. 100,000/-

Other items in the bill …………………… Kshs. 18,200/-

Total ………………………………....….. Kshs. 118,200/-

(c) What Orders should issue on the 3rdRespondent’s Application dated 4/11/2020?

46. The application by the 3rd defendant dated 4th November 2020should have been filed elsewhere and not in these proceedings. Furthermore, in view of the ruling on the applicant’s application dated 15th October 2020, the 3rd respondent’s application dated 4th November 2020 has no merit and it is hereby dismissed with costs to Eldoret Express Limited the applicant in the reference, only it being the only logical respondent therein.

(d) Who should bear the costs of the Reference and the taxation proceedings and the 3rd Respondent’s application dated 4/11/2020?

47 The parties shall bear their own costs of the instant application. The 3rd defendant alone shall bear the costs of the application dated 4/11/2020.

It is so ordered.

Dated, signed and delivered at Kitale via electronic mail on this 2nd day of February, 2021.

MWANGI NJOROGE

JUDGE, ELC, KITALE.