https://new.kenyalaw.org/akn/ke/judgment/keelc/2026/2944

Kobilo Farm Limited & another v Elfam Limited & another (Environment and Land Case 24 of 2020) [2026] KEELC 2944 (KLR) (14 May 2026) (Ruling) Neutral citation: [2026] KEELC 2944 (KLR) Republic of Kenya In the Environment and Land Court at Eldoret Environment and Land Case 24 of 2020 CK Yano, J May 14, 2026 Between Kobilo Farm Limited 1st Plaintiff Metropole Holdings Limited 2nd Plaintiff and Elfam Limited Defendant and Commodities Fund Interested Party Ruling 1.Two applications have been placed before this court for determination. A. The Application dated 18th November, 2025; 2.The first application is a Notice of Motion brought by Plaintiffs/Judgment Debtors seeking for orders that:-1.Spent2.That the balance of the funds deposited and currently being held at Co-operative Bank of Kenya Limited, Kitengela Branch joint account No. 01103285248200 under Yano & company Advocates and Limo R. K. Co. Advocates together with interests thereto be released to the judgment debtors/applicants herein.3.That costs of this application be borne by the respondent. 3.The Application is supported by the Affidavit of Wilson Kipkosgei Maina, a Director of the Plaintiffs. He deponed that the Plaintiffs instituted this suit against the Defendant and judgment was entered in favour of the Defendant on 14th March, 2024. That prior to hearing, the court in its ruling of 23/09/2020, ordered that the deposit of the purchase price paid, being KShs. 58,000,000/- be deposited in a joint account in the names of the advocates. He averred that in its judgment, the court ordered payment of general damages, retention of 10% of the purchase price plus costs and interests. 4.He further deponed that the court vide another ruling of 19/05/2025 allowed the Respondent’s garnishee Application with respect to KShs. 24,280,000/-, being the decretal sum plus interest thereon. In compliance with the garnishee order, the Co-operative Bank, Kitengela Branch has since released the decretal sum in satisfaction of the judgment. The Plaintiffs thus claim that since the judgment has been satisfied, there is no reason whatsoever to continue withholding the balance of the funds held in the said joint account. They therefore sought a release order for the balance of the funds held therein and the interests thereto to enable them access the same, which order they urge is sought in the best interest of justice. 5.Upon service of the application, the Defendant/Respondent filed Grounds of Opposition dated 10th December, 2024 in response, raising the following grounds:-1.That the application as drawn and filed is misconceived, incompetent and does not lie or at all.2.That the Applicants have filed and are litigating in the Court of Appeal at Eldoret in Eldoret Court of Appeal Civil Application Number E054 of 2024 and Eldoret Civil Appeal Number E064 of 2025, which matters are appeals from the decision of this Honourable Court in this matter and hence the hearing of the Application should await the determination of the Court of Appeal of the two aforesaid matters.3.That the orders made by the Honourable Court vide the ruling dated 23rd September, 2020 were intended to secure the interests of all the parties herein and hence the orders sought in the application cannot be granted when the litigation is still ongoing.4.That the Application should elect whether to proceed with the matters in the Court of Appeal or abandon them.5.That the Applicants are yet to settle the costs of this suit which costs ought to be recovered from the amount deposited in the joint account. 6.The Defendant filed a further response, being a Replying Affidavit sworn on 22nd January, 2026 by Ms. Alice Yano, the Defendant’s advocate on record. She acknowledged that the Plaintiffs did commence these proceedings against the Defendant and judgement was entered on 14th March, 2024 in favour of the Defendant. She also conceded that during the pendency of the matter, the Court on 23/09/2020 ordered that a sum of KShs. 58,000,000/= be deposited in the joint names of the Advocates on record, which was done. She explained that the purpose of the said deposit was to secure the interest of the parties in the suit pending the full determination of the dispute. 7.She deponed that the Plaintiffs have however lodged an appeal in the Court of Appeal, being Eldoret Court of Appeal Civil Appeal No. E064 of 2025 against the aforesaid judgement, which is pending hearing and determination by the said court. She averred that the decree in this matter is therefore yet to be settled, and in particular the costs of the suit and the issues in respect of the suit properties are yet to be determined. That it is thus premature to grant the orders sought unless the Plaintiffs are withdrawing their appeal aforesaid. She asked that the hearing of the application should await the determination of the appeal. She further averred that it is in the interest of justice that the money remain in the bank until all issues are resolved. B. Application dated 3rd February, 2026; 8.The second application is the Defendant’s Notice of Motion dated 3rd February, 2026 asking the following reliefs:-1.Spent.2.That the Deputy Registrar of the Environment and Land Court, Eldoret be directed to give the reasons for the ruling delivered on the 5th of December, 2025.3.That in the alternative to prayer 2 above, the Court does deem the facts set out in the ruling delivered on the 5th of December, 2025 to be the Deputy Registrar’s reasons for her ruling.4.That the Honourable Court be pleased to set aside and vacate in its entirety, the Deputy Registrar’s ruling on the Defendant’s Bill of Costs dated 21st March, 2024 delivered on the 5th of December, 2025.5.That the Honourable Court be pleased to tax/assess afresh the Defendants Bill of Costs dated 21st March, 2024.6.That the costs of this application be provided for. 9.The grounds in support of this application are set out on the face of the motion, as well as a Supporting Affidavit of even date sworn by Ms. Alice Yano, their advocate on record, who deponed that she filed her Party and Party Bill of Costs dated 23/03/2024. That the Deputy Registrar, Environment and Land Court at Eldoret delivered her ruling on 05/12/2025, wherein she taxed the said bill at KShs. 3,494,039/-. Being dissatisfied and aggrieved by the said ruling, they gave a notice of objection and applied for reasons for the said ruling pursuant to Rule 11 of the Advocates (Remuneration) Order vide letter dated 10/12/2025. 10.She however avers that to date she has not been supplied with the reasons by the Deputy registrar. That the said Deputy Registrar (Hon. N. Barasa) has since been transferred to another station, and thus it will take a long time for the said reasons to be supplied. She deponed that the Defendant objects to the said ruling per the reasons enumerated in the body of the application filed herewith. That the Deputy Registrar determined the instruction fees based on only one property yet the subject matter of the suit was two properties and sale agreements were produced in court setting out the value thereof. 11.She further deponed that the Deputy Registrar should have taken into account the value of the subject matter to be KShs. 205,000,000/- as stated in the judgement of 14/03/2024, in assessing the instruction fees. She accused the Deputy Registrar of failing to take into account the principles governing taxation of bill of costs and hence arrived at a wrong decision. She averred that the costs awarded are manifestly disproportionate to the subject matter of the suit, inordinately low and unreasonable. She thus prayed that the decision of the DR be set aside as it is premised on the wrong principles of law and is without any basis in law, and asked that the Party and Party Bill of Costs be taxed afresh by this Honourable Court. She urged that it is in the interest of justice that the orders sought herein are granted. 12.The Plaintiffs responded to this application through a Replying Affidavit sworn by their director, Wilson Kipkosgei Maina on 20th February, 2026. He averred that the said application is frivolous, lacks merit and that it was brought outside the required timelines. He deponed that the Defendant’s Bill of Costs was taxed to scale. That the DR exercised her discretion thus there is no need to interfere with her ruling. He deponed that this court can only interfere with the Taxing Officer/DR’s discretion where it was not exercised judiciously. He further averred that the DR’s ruling of 5th December, 2025 is detailed and gives sufficient reasons on every item. That it would thus be superfluous to give further reasons as it would amount to repeating herself, thus Defendant ought to have proceeded to file their reference on time. 13.He further averred that the Defendant had not written any follow up letters to the DR, and had instead chosen to lie indolent for two months after the ruling and filed the reference out of time. He explained that the DR based her taxation of Item 1 and 3 on the instruction fee based on the final orders of the judge on the value of one parcel since it was the only parcel in dispute. He averred that the award on instruction fee was thus sufficient, and pointed out that the other items on the bill were not disputed. He asserted that the DR exercised her discretion and applied the laid down principles in taxing the bill, and there is no reason to alter the DR’s decision. He asked that the application be dismissed with costs. Submissions: 14.The court directed that both applications be canvassed by way of written submissions. In compliance, the Plaintiffs filed their submissions dated 8th April, 2026. The Defendant filed submissions dated 10th April, 2026 opposing the Plaintiff’s Application. The Defendant also filed submissions dated 26th March, 2026 in support of its application dated 3rd February, 2026 Analysis and Determination: 15.I have read the two applications and their respective responses. I have also considered at length the submissions filed by Counsel on behalf of their respective clients, and I am of the view that the following issues arise for determination:-a.Whether the balance of the funds held at Co-operative Bank of Kenya Limited, Kitengela Branch joint account No. 01103285248200 should be released to the plaintiffs.b.Whether the reference was filed within the prescribed timelines;c.Whether the taxing master failed to give reasons for her ruling; andd.Who shall bear the costs of the two applications? Whether the balance of the funds held at Co-operative Bank of Kenya Limited, Kitengela Branch joint account No. 01103285248200 should be released to the plaintiffs; 16.The sole issue for determination in the Plaintiff’s application dated 18th November, 2025 is the release of the balance of the funds held at Co-operative Bank of Kenya Limited, Kitengela Branch joint account No. 01103285248200. The Plaintiffs claim that judgment in this matter was delivered. That the same was successfully executed when the court allowed the Defendant’s Application for a Garnishee Order Absolute on 19th May, 2025. According to the Plaintiffs therefore, there is nothing pending in these proceedings to warrant the continued holding of the funds in the joint account. 17.The Defendant however opposed the application, claiming that the Judgment is yet to be fully satisfied. The Defendant pointed out that the costs awarded to it by the court in its judgment are yet to be settled, that there is a pending appeal against the judgment, and further that the order made on 23/09/2020 was not time bound. According to the Defendant, the application for release of the funds is premature as no accounts have been taken to determine each party’s entitlement to the funds. 18.I have carefully considered the application and the reasons advanced in seeking to have the funds released. I have also taken time to read and understand the order made by this court on 23rd September, 2020, which was to the effect that:-“Having considered the Plaintiff’s application together with the rival submissions by counsel I find that the balance of convenience tilts in favour of the defendant who is the registered owner of the suit land and order that the status quo obtaining as at the 11th June, 2020 be maintained to preserve the substratum of the case pending the hearing and determination of this case. I further order that in the interest of justice and to secure the interest of both parties the defendant to deposit in a joint interest earning account of the advocates on record for the parties the amount paid by the plaintiff in respect of the disputed parcel within the next 30 days.” 19.As the Defendant has correctly pointed out, the orders of the court made on 23rd September, 2020 were indeed not time bound. I note that the order of status quo was expressly issued pending hearing and determination of the suit. However, the order for deposit of the funds was made for the protection of the interests of both parties and did not expressly state that the funds were to be held pending hearing and determination of the case. 20.It is clear that the interests of the parties, which the court sought to protect, have not been fully determined. It is true that the matter of costs of the suit is yet to be determined. This is evidenced by the second application dated 3rd February, 2026 placed for determination before this court in this ruling. 21.In addition, on 18th March, 2024 the Plaintiffs did file a Notice of Appeal in this Court, expressing their dissatisfaction with the entire judgment delivered herein, as well as their intention to move to the Court of Appeal on the same. The Defendant has informed this court that the said appeal is still pending before the appellate court, an assertion the Plaintiffs did not bother to deny or affirm. 22.The Plaintiff cited the case of Fredrick Mageria Githinji vs Charles Mwangi Muriithi (2021) KEHC 4254 (KLR), where the Court held that:-“ 17.It is important to emphasize that the security deposited in the joint names of the advocates for the parties, either by consent or by an order of the court remains the money of the depositor in the appeal until the appeal is determined. This reasoning has a bearing on the fact that the appeal may fail or it may succeed. However, in the event of a successful appeal, the appellant is entitled to apply that the funds be released to him/her depending on the circumstances of the case. Such circumstances such as enhancement or reduction of damages will guide the court or the parties as to how much may be released to the party/parties entitled. 18.It goes without saying that since the amount herein was deposited as security for judgment, the decree-holder’s funds will be paid from the amount deposited therein and that the judgment debtor takes the balance of the funds in the account, if any. 19.I reach a conclusion that the amount deposited in the joint account in the names of the advocates for the parties plus any interests accrued are the appellant’s funds from which the whole or part of the sum will be utilized to settle the amount of the decree including costs that may be owing to the respondent.” 23.This matter can however be distinguished from this case since it was dealing with money deposited in a joint account as security for grant of a conditional stay of execution. Moreover, in its above reasoning, the court was only dealing with the question of who was entitled to interest of the funds deposited in the joint account of the advocates and not the release of the principal amount itself. 24.The Plaintiffs also cited the case of MS Sharriff & Company Advocates vs Gaceri (2024) KEHC 10436 (KLR), where the High Court held that:-“ 20.With regard to the application by way of Notice of Motion dated 13th March 2023, having considered all the grounds therein, affidavits and the submissions filed on behalf of the parties, I find that substantive justice will require that the money deposited in the joint bank account will not remain therein for eternity. It has to be released, as even the High Court in its earlier ruling, had specifically given a timeline of 21 days for action to be taken either way, on the amounts in the joint bank account.” 25.But as pointed out by the High Court in the above extract, the court had specifically given a timeline of 21 days for action to be taken by either party. In this instance however, the earlier ruling of this court did not give or set any timelines for the release of the funds, save that they were to protect the interests of both parties. 26.Therefore, for as long as the matter is not fully determined, the interests of the parties remain in limbo, and are deserving of the continued protection that this court sought to give in its said order of 23rd September, 2020. What this means therefore, is that the order is still active and valid until the matter is fully determined, and the interests of the parties with regards to the matters raised in this suit are fully settled. Whether the reference was filed within the prescribed timelines; 27.It is trite law that in matters of taxation and a reference such as this, a court hearing the reference must warn itself that the decision of the taxing master can only be interfered with where there is an error in the principles applied in the taxation giving rise to the reference. In the case of Kipkorir, Titoo & Kiara Advocates vs Deposit Protection Fund (2005) eKLR it was stated by the court that:-“On a reference to a judge from the taxation by the Taxing Officer, the judge will not normally interfere with the exercise of discretion by the taxing officer unless the taxing officer, erred in principle in assessing the costs. In Arthur vs Nyeri Electricity Undertaking (1961) EA 497, the predecessor of this Court said at page 492 paragraph I:‘where there has been an error in principle the court will interfere; but questions solely of quantum are regarded as matters with which the taxing officers are particularly fitted to deal and the court will interfere only in exceptional cases’.” 28.This position was reiterated in the case of Nyangito Co. Advocates vs Ndoinyo Lessos Creameries Ltd (2014) eKLR, where it was held that:The circumstances under which a Judge of the High Court interferes with the taxing officer’s exercise of discretion are now well known. These principles are,(1)that the Court cannot interfere with the taxing officer’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 Remuneration 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 Officer discloses errors of principle, the normal practise is to remit it back to the taxing officer for reassessment unless the Judge is satisfied that the error cannot materially have affected the assessment and the Court is not entitled to upset a taxation because in its opinion, the amount awarded was high;(4)it is within the discretion of the Taxing Officer to increase or reduce the instruction fees and the amount of the increase or reduction is discretionary;(5)the Taxing Officer must set out the basic fee before venturing to consider whether to increase or reduce it;(6)the full instruction fees to defend a suit are earned the moment a defence has been filed and the subsequent progress of the matter is irrelevant to that item of fees;(7)the mere fact that the defendant does research before filing a defence and then puts a defence informed of such research is not necessarily indicative of the complexity of the matter as it may well be indicative of the advocate’s unfamiliarity with basic principles of law and such unfamiliarity should not be turned into an advantage against the adversary. These principles were stated in the case of First American Bank of Kenya vs Shah and Others (2002) 1 EA 64. 29.Having so warned myself, I proceed to determine the reference before me. First and foremost, the Plaintiff raised issue with the timeline as regards the filing of the Reference. The Plaintiffs claim that the Application herein was filed outside the timelines required under the law. 30.Rule 11 of the Advocates (Remuneration) Order provides a detailed process of objection to taxation of costs 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.(3)Any person aggrieved by the decision of the judge upon any objection referred to such judge under subsection (2) may, with the leave of the judge but not otherwise, appeal to the Court of Appeal.(4)The High court shall have power in its discretion by order to enlarge the time fixed by subparagraph (1) or subparagraph (2) for the taking of any step; application for such an order may be made by chamber summons upon giving to every other interested party not less than three clear days’ notice in writing or as the Court may direct, and may be so made notwithstanding that the time sought to be enlarged may have already expired. 31.Under Rule 11(1) of the ARO, the Defendant had 14 days from the date of the ruling to give notice in writing to the taxing master of the items of taxation to which he objects. The Taxing master would then be obligated to respond by giving the reasons for her decision on the contested items. Upon issuance of the reasons for the decision by the taxing master, the Defendant had 14 days under Rule 11(2) to file the Reference herein. However, the Taxing Master did not respond to the request to give reasons for the taxation. 32.In this case, the Ruling on the Bill of Costs was delivered on 5th December, 2025. The Application herein is dated 3rd February, 2026 and was filed on the same date. The Defendant only delayed in filing the application for about two months. It is clear that no reasons were given for the alleged delay in filing the reference. In addition, there was no prayer for extension of time within which to file the reference. Nevertheless, the issue of timelines has been raised and this court must determine it. 33.Rule 11(4) above gives this court power in its discretion to enlarge the time fixed by Sub-rule (1) or (2) for the taking of any step. The said provision does not give any conditions for the extension of time save that the decision to do so is wholly reliant on the discretion of the court. In seeking to balance the interest of the respective parties herein, I am convinced that the delay of two months was not inordinate. 34.Moreover, courts have held that if an Applicant decides to wait for a formal response from the Taxing Officer to the notice before proceeding, then he cannot be faulted for doing so and hence the reference is deemed to have been filed within time. Be that as it may, even in the absence of the prayer for extension of time, this court will proceed to exercise its inherent powers to make a determination on the same. For this reason, the court will proceed to deem the reference as duly filed on time. Whether the taxing master failed to give reasons for her ruling; 35.The Defendant’s main ground of objection as appears from the Application herein and supporting Affidavit is that the taxing master did not give reasons for her ruling despite the Defendant writing to ask for them. 36.In compliance with Rule 11(1), the Defendant wrote to the taxing master vide its advocate’s letter dated 10/12/2025, indicating that it was objecting to the taxation of all items in the Party and Party Bill of Costs dated 21/03/2024. It is the letter of objection that sets the stones rolling in that the Taxing Master is now required to respond by giving reasons for the decision. 37.Although in some instances the ruling of the taxing master is self-explanatory, and courts have held that the requirement to seek reasons may be dispensed with, the need to supply reasons for a taxation cannot be downplayed. In Evans Thiga Gaturu, Advocate vs Kenya Commercial Bank Limited (2012) eKLR, the Court explained that:-“… In my own view, where no reasons appear on the face of the decision of the taxing master, it is only prudent that such reasons be furnished in order for the Judge to make an informed decision as to whether or not the discretion of the taxing master was exercised on sound legal principles.” 38.I have seen and read the ruling by the Taxing master which was exhibited in the application dated 3rd February, 2026. Notably the ruling does not indicate why the Taxing Master decided to rely on the value of one property, which decision evidently precipitated down to the formula that the taxing officer applied to access the instructions fees. This being the main ground of objection, the failure to indicate the reason for taxing the said item of instruction fees is, in and of itself, contrary to the rules of taxation, and amounts to an error in principle. 39.The need for reasons was explained in Nyamogo & Nyamogo vs. Kenya Bus Services Nairobi Milimani HCMA No. 587 of 2004, where Ochieng’, J stated that:-“Where the sum awarded is four times the minimum sum prescribed, the taxing officer would have been expected in his reasons for taxation to justify his finding that such an award was appropriate...Such reasons are essential when the Judge is giving consideration to a reference, as it enables the Court determine whether or not the taxing officer may have taken into account irrelevant consideration; or if he had failed to take into account relevant factors, or if the taxing officer had erred in principle.” 40.In the present case, the Defendant Bill of Costs was drawn at KShs. 20,000,000/- but was taxed at KShs. 3,000,000/-, more than eight times less than the amount drawn by the Defendant’s advocate. With such a monumental reduction in the sum taxed, the Defendant was entitled to the reasons by the taxing matter on how she arrived at such an amount. The Taxing master, however, did not do so. 41.In Muriu Mungai & Co Advocates vs New Kenya Co-Operative Creameries Ltd Nairobi (Milimani) HCMC No 692 of 2007, Mwilu, J was of the view that:“It is mandatory for an applicant who objects to a taxation to annex the ruling, giving reasons by the taxing master supporting the taxation...Nowhere is it provided that if there be a delay in the taxing master giving reasons for taxation then a party may file a reference. Instead, rule 11 (4) gives the court power to enlarge time if the same lapses before a step needed to be done is done or taken...Under the rules the taxing officer is required forthwith, upon receipt of the notice of objection to give reasons for the decision and where they fail to do so, the thing to do is not to file a reference to the High Court...In the court’s view, the applicant moved the court too soon. More reminders should have been sent to the taxing officer for reasons or any other legal action that would have resulted in the taxing officer giving reasons to be taken to have the reasons given. Nobody else can give those reasons but the taxing officer and it has not been shown that the taxing officer is not available. And more importantly the court cannot determine the matter in the absence of the taxing officer’s reasons for her decision in taxing the bill of costs as she did.” 42.In this instance, the Taxing Master that taxed the Defendant’s Bill of Costs was transferred to another station. As stated in the above authority, a judge cannot determine the application in the absence of the taxing officer’s reasons. These reasons can only be given by the taxing officer herself, yet she is on transfer. To insist on waiting for the reasons sought could waste judicial time, as there is no telling when the same will be furnished, if at all. In the interest of justice therefore, this court will proceed to remit the Party and Party Bill of Costs for re-taxation by another Taxing Master. Who shall bear the costs of the two applications? 43.Turning to the issue of Costs, Section 27 of the Civil Procedure Act provides that Costs follow the event. They are therefore awarded to the successful party in any litigation. Section 27 further provides that costs are awarded at the discretion of the court. This discretion is affirmed by the Proviso to Section 27, which allows a court to depart from the general rule that costs follow the event upon sufficient grounds being given. 44.In this instance, the Plaintiff filed the first application dated 18th November, 2025 but did not succeed in prosecuting it. The Defendant on its part, filed the application dated 3rd February, 2026 and has only partially succeeded in the said application. In the circumstances, this court will make no award on costs in the two applications herein. Orders:- 45.In the end, I find that the application dated 18th November, 2025 fails and is hereby dismissed. The application dated 3rd February, 2026 however, succeeds to the extent that the Defendant’s Party and Party Bill of Costs dated 21st March, 2024 is remitted back for fresh taxation by a different taxing master. 46.There shall be no order as to costs. 47.Orders accordingly. DATED, SIGNED AND DELIVERED VIRTUALLY AT ELDORET ON THIS 14TH DAY OF MAY, 2026 VIDE MICROSOFT TEAMS.HON. C. K. YANOELC, JUDGEIn the virtual presence of:-Ms. Koech holding brief for Mr. Kibii for Plaintiffs.Mr. Ngaira & Ms. Yano for Defendant.Court Assistant - Laban.