[2007] KEHC 699 (KLR)
The court held that since the 2nd and 3rd respondents were companies under receivership, the respondent advocate was required to obtain leave of the court before commencing any action or proceedings against them, as mandated by Section 228 of the Companies Act. The failure to obtain such leave rendered the...
Source-derived case information.
- Citation
- [2007] KEHC 699 (KLR)
- Parties
- Applicant: Muturi & Apopo Advocates; Respondent: Hon. Cyrus Jirongo Sololo Outlets Ltd
- Court
- High Court
- Court Station
- High Court at Nairobi (Milimani Law Courts)
- Jurisdiction
- Kenya
- Case Number
- ? 828 of 2006
- Procedural Posture
- Miscellaneous Application / Ruling on Chamber Summons to Strike Out Advocate's Bill of Costs
- Outcome
- application allowed; advocate's bill of costs struck out with costs
- Judges
- JL Osiemo
- Legal Topics
- Taxation of Costs, Leave to Sue Company in Receivership, Abuse of Process, Striking Out Proceedings
- Source Language
- en
Source-derived case record
Summary, issues, holding and outcome
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Parties
Muturi & Apopo Advocates
Applicant
Hon. Cyrus Jirongo Sololo Outlets Ltd
Respondent
Procedural Posture
Miscellaneous Application / Ruling on Chamber Summons to Strike Out Advocate's Bill of Costs
Legal Issues
- 1 Whether the advocate's bill of costs could be maintained against companies under receivership without leave of the court.
- 2 Whether the bill of costs was properly served and constituted an abuse of court process.
Ratio Decidendi
The court held that since the 2nd and 3rd respondents were companies under receivership, the respondent advocate was required to obtain leave of the court before commencing any action or proceedings against them, as mandated by Section 228 of the Companies Act. The failure to obtain such leave rendered the advocate's bill of costs unsustainable. The court further found that the bill of costs had not been properly served on the 1st defendant prior to taxation. These procedural lapses constituted an abuse of the court process, justifying the striking out of the bill of costs. The application to strike out the bill of costs was therefore allowed, and the advocate's bill of costs was struck...
Court Disposition
application allowed; advocate's bill of costs struck out with costs
Orders
- The advocate's bill of costs dated 30th October 2006 is struck out.
- The applicant is awarded costs of the application.
Full Case Text
Judgment text and source record
25 paragraphs
REPUBLIC OF KENYA
HIGH COURT OF AT NAIROBI (MILIMANI LAW COURTS)
Misc Appli 828 of 2006
MUTURI & APOPO ADVOCATES………………….....…………….APPLICANT
VERSUS
HON. CYRUS JIRONGO SOLOLO OUTLETS LTD…………..RESPONDENT
RULING
The Applicant is a business man and he holds interests in various companies which include:
(i) SOLOLO OUTLETS LTD
(ii) CYPER ENTERPRISES LTD
(iii) CYPER PROJECTS INTERNATIONAL
(iv) KUZA FARMS AND ALLIED LTD
(v) NASHVILLE INVESTMENTS LTD
(vi) KIPA & SONS LTD.
In April 2004 His Excellence the President appointed a Commission known as Goldenburg Commission of Inquiry to investigate various companies and persons in respect of their activities in the Goldenburg affairs.
The 2nd and 3rd Respondents which are companies under receivership were among those mentioned for investigations by the commission. The Respondent who is an advocate represented the Applicants in the inquiry and later served them with a bill of costs amounting to Shs.51,591,290/=.
The Applicants on being served with the bill of costs filed this application by way of Chamber Summons seeking orders to strike out the Advocates Bill of Costs for being an abuse of the process of the court and for being frivolous and scandalous and vexatious. They also sought costs of this application.
The application is based on the grounds that the bill of costs has not, prior to the filing of this taxation been served on the 1st Defendant and that no leave has been obtained by the advocate to commence these proceedings against the 2nd and 3rd Defendant’s which are companies currently under receivership. The application is also supported by an affidavit sworn by Cyrus Jirongo on 4th December 2006. The application is opposed by the Respondent who has filed a replying affidavit sworn by the counsel himself on 9th January 2007 in which he avers that a bill of costs is not a suit within the meaning ascribed to it by the Civil procedure Act and the rules made thereunder and that the bill of costs is merely an assessment of the just fee payable by the client to an advocate and it is consequence to such assessment that a suit for recovery of costs can be filed and that upon such event his firm shall elect who to sue and in what capacity if payment of fee is not made.
Section 228 of the Companies Act Cap 486 provides that when a Winding up Order has been made or an Interim Liquidator has been appointed under Section235, no action or proceedings shall proceed with or commenced against the company except by leave of the court and subject to such terms as the court may impose.
The Respondent served the 3 Applicants with a bill of costs between the advocate and client intending to recover a sum of Shs.51,551,290/=. The 2nd and 3rd Respondents being companies under receivership, to commence an action against them, leave of the court was required and the Respondent having not obtained such a leave his action is unsustainable and should fail.
Consequently the Applicant’s application is allowed in terms of Prayers 1 and 2 of the Chamber Summons dated 4th December 2006.
The Advocate’s Bill of Costs dated 30th October 2006 is struck out with costs.
Dated and delivered at Nairobi this 13th day of July 2007.
J.L.A. OSIEMO
JUDGE