https://new.kenyalaw.org/akn/ke/judgment/kehc/2026/10447

New Promise Contractors Ltd v Onyango t/a Jeko Auctioneers (Civil Miscellaneous Application E022 of 2026) [2026] KEHC 10447 (KLR) (15 July 2026) (Ruling) Neutral citation: [2026] KEHC 10447 (KLR) Republic of Kenya In the High Court at Siaya Civil Miscellaneous Application E022 of 2026 DK Kemei, J July 15, 2026 Between New Promise Contractors Limited Applicant and Johnson Kim Onyango t/a Jeko Auctioneers Respondent Ruling 1.The Applicant has filed this Reference dated 15th June 2026 seeking the following reliefs:i.Spent.ii.Spent.iii.This Honourable Court be pleased to extend/ enlarge time for the filing of the instant reference and that the said reference be deemed as having been filed and thus properly on record.iv.This Honourable Court be pleased to set aside the decision of the Hon. Magistrate made through the ruling dated 28th May 2026 in Ukwala MCCC Misc. App. No. E61 of 2025v.This Honourable Court be pleased to order and or direct that the Respondent’s Bill of Costs dated 1st December 2025 filed in Ukwala MCCC Misc. App. NoE061 of 2025 be remitted back to a different Magistrate for re-taxation.vi.In alternative, this Honourable Court be pleased to tax a fresh the Respondent’s Bill of Costs dated 1st December 2025 filed in Ukwala MCCC Misc. App. NoE061 of 2025.vii.Costs of this application be provided for. 2.The Application is supported by the grounds set out thereunder and the supporting affidavit sworn by Amon Mahindi Githinji sworn on even date. The Applicant’s gravamen rests on two main fronts: a procedural justification for filing late and substantive challenges to specific costs awarded to the auctioneer. The Applicant has averred inter alia; that it admits the Reference was filed outside the statutory timeline but blames it on a geographical oversight by their Nairobi-based counsel in that the Counsel had mistakenly assumed that appeals from the Ukwala Magistrate's Court should be filed in the Kisumu High Court, where they lodged a reference on 11th June 2026; that after the Kisumu court ordered a transfer to Siaya, the Applicant chose to withdraw that matter and file a fresh application directly in Siaya on 16th June 2026 to stop imminent execution; that the Applicant contents that the Taxing Officer erred in principle by approving fees that were completely unsupported by hard evidence: that as regards Item 3 (Investigations – Kshs. 10,000), it is contended that no investigative work was done because the vehicle's registration details were simply handed over by the instructing advocate; that as regards Items 4 & 6 (Service & Transport – Kshs. 5,000 & Kshs. 45,807.90) it was contended that no physical travel took place because the proclamation was served entirely over WhatsApp; that as regards Item 17 (Auctioneer Commission – Kshs. 48,160.40), the Applicant argues that the 2% commission should have been calculated based on the decretal sum (which would equal Kshs. 17,264/=) rather than the estimated value of the attached motor vehicle; that as regards the issue of VAT Charges, the Applicant objects to paying VAT because the auctioneer did not supply formal proof of being registered as a VAT payer. 3.The Application was opposed by the Respondent who filed grounds of opposition dated 17th June 2026 wherein he averred inter alia; that the aforesaid application as presented is incurably defective, misconceived and hinged on the wrong provisions of the Law and Procedure; that the application as presented is a wanton abuse of the court process, scandalous, frivolous, vexatious and intended to embarrass the Court and the legal process; that the Application does not meet the evidentiary threshold of granting the orders sought; that the application has been presented after the lapse of Seven (7) days contrary to the provisions of Rule 55 (5) that makes it mandatory that such applications bearing the nature of appeals have to be lodged not more than seven days after the decision of the magistrate or registrar.; that the Application should be dismissed with costs. 4.The Application was canvassed by way of written submissions. It is noted that only the Respondent has duly complied and filed his submissions. 5.It was submitted by Counsel for the Respondent that the instant application substantially is in the nature of a reference with respect to auctioneer costs as assed by the learned trial Magistrate. That it ought to be filed within Seven (7) days of such ruling. Counsel placed reliance on Rule 55(4) of the Auctioneers Rules which provides: “Any person who is aggrieved by the decision of a registrar or magistrate in respect of fees may within seven days apply to a judge in chambers.” It was submitted that it is not in dispute that the impugned ruling was delivered on the 28th day of May, 2026 and thus the Applicant had a window ending on the 4th day of June 2026 to file the reference but it failed to do so. That the instant reference was filed on the 16th day of June, 2026 twelve (12) days after the lapse of that window. As regards the issue of time, Counsel placed reliance in the case of Old Mutual General Insurance Kenya Limited v Kariuki t/a Moran Auctioneers (Miscellaneous Application E868 of 2025) [2025] KEHC 18522 (KLR) where it was held: “The Rule is couched in mandatory terms. It creates a strict, short limitation period within which an aggrieved party must move the Court. The purpose of the provision, consistent with the nature of taxation proceedings is to ensure finality, expedition and avoidance of delays in the enforcement of costs.” 6.Counsel further placed reliance in the Court of Appeal decision emphasizing on the need to comply with timelines in n Bi-Mach Engineers Ltd v James Kahoro Mwangi [2011] eKLR, where it was held: “The Rules of Court must be followed. The Court cannot aid a party who, through negligence or indolence, fails to comply.” 7.It was submitted that the instant reference has been filed out of time thus ought to be dismissed. On the issue of whether the Applicant has demonstrated sufficient cause to warrant extension of time under Rule 55(4) of the Auctioneers Rules, it was submitted that it is not in dispute that the reference has been filed out of time. The power to enlarge and/or extend time is discretionary upon sufficient and reasonable explanation being presented. It was contended by counsel for the Respondent that the Applicant argues that the delay was on account of having mistakenly filed the reference before the High Court in Kisumu as opposed to the instant court which entertains such applications from Ukwala Magistrate’s Court. It was submitted that the Applicant is attempting to mislead the Honourable Court that the said application before Kisumu High Court was filed within the Seven (7) days. It was further submitted that as per annexure marked “AMG-7” of the Applicant’s supporting affidavit, the pleadings filed before the High Court in Kisumu were dated the 10th day of June 2026. Counsel submitted that additionally, it is the Applicant’s own admission that the said application was filed on the 11th day of June, 2026 approximately seven (7) days after the lapse of the window as contemplated by Rule 55 of the Auctioneer Rules. It was further submitted that the Applicant has failed to demonstrate why even the application that was erroneously filed before the High Court at Kisumu was filed out of time. It is also submitted that extension of time is only granted to a deserving party. The principles governing such discretion were crystallized by the Supreme Court in Nicholas Kiptoo Arap Korir Salat v IEBC & 7 Others [2014] eKLR, where the Court stated: “Extension of time is not a right of a party. It is an equitable remedy that is only available to a deserving party at the discretion of the Court.” Counsel submitted that no excusable reason backed by evidence has been presented to warrant this Honourable Court to invoke its discretionary powers to extend and/or enlarge time. On the issue of whether the Applicant has met the threshold for stay of execution, it was submitted that the Applicant has not demonstrated any substantial loss that will be occasioned to it should stay of execution not be granted. Counsel further submitted that the sole reason why the Applicant seeks stay of execution is because it is aggrieved by the decision of the learned trial magistrate. That additionally, no form of security is being offered by the Applicant in its quest for stay of execution. It has not even implied any willingness to offer such. Counsel proactively urges the Court to find that the application has been filed out of time, no excusable reasons have been tendered for the delay and no security has been offered for the stay of execution that is sought. The same should be dismissed in its entirety with costs. 8.I have considered the Reference and the submissions by Respondent. I find the issue for determination is whether the Reference has merit. 9.It is noted that the Chamber Summons explicitly states that it is brought under Rule 11(2) and (4) of the Advocates (Remuneration) Order. This Court notes that the dispute purely centers around an Auctioneer's Bill of Costs. Auctioneers are officers regulated under the Auctioneers Act and the Auctioneers Rules, 1997. Taxation disputes concerning auctioneers are strictly governed under Rule 55 of the Auctioneers Rules. While Article 159(2)(d) of the Constitution of Kenya mandates that courts should not elevate procedural technicalities above substantive justice, a complete misdirection of the statutory framework sets a dangerous precedent. However, rather than striking out the application solely on this defect, this Court chooses to look at the weightier hurdles facing the Applicant namely, limitation of time 10.The statutory timeline governing taxation references for auctioneers is clear and mandatory. Rule 55(4) of the Auctioneers Rules, 1997 explicitly provides:“Any person who is aggrieved by the decision of a registrar or magistrate in respect of fees may within seven days apply to a judge in chambers." 11.The computation of time in this matter is straightforward. The date of Taxing Officer's Ruling was 28th May 2026. Hence, the expiration of the statutory 7-day window was on the 4th June 2026 whereas the filing date of current application is 16th June 2026. 12The Applicant is twelve (12) days out of time. To bypass this barrier, the Applicant must seek the Court’s equitable discretion for enlargement of time. The locus classicus guiding judicial discretion in extensions of time is the Supreme Court of Kenya decision in Nicholas Kiptoo Arap Korir Salat v. IEBC & 7 Others [2014] eKLR, where it was firmly established that:“Extension of time is not a right of a party. It is an equitable remedy that is only available to a deserving party at the discretion of the Court. The party seeking extension must lay out a plausible and reasonable explanation for the delay." 13.This Court is also guided by the recent decision in Old Mutual General Insurance Kenya Limited v. Jovah Kariuki t/a Moran Auctioneers [2025] KEHC 18522 (KLR), where it was held:“The Rule is couched in mandatory terms. It creates a strict, short limitation period within which an aggrieved party must move the Court. The purpose of the provision, consistent with the nature of taxation proceedings is to ensure finality, expedition and avoidance of delays in the enforcement of costs.” 14.It is thus clear that Rule 55(4) of the Auctioneers Rules is couched in mandatory terms and creates a strict short limitation period designed to ensure finality expedition and avoidance of unnecessary delays in the enforcement of costs. 15.The Applicant's lone excuse is that Counsel practicing in Nairobi did not know the geographic and administrative boundaries governing the High Court jurisdiction for Ukwala Subordinate Courts leading them to file in Kisumu. This excuse falls short for two crucial reasons inter alia; that territorial jurisdiction is a basic tenet of legal practice. Mistake of counsel regarding settled geographical jurisdiction does not automatically transform into an excusable reason under equity; that the Applicant filed the erroneous reference in Kisumu on 11th June 2026. As demonstrated by the Respondent, the statutory window had already slammed shut on 4th June 2026. The Applicant has offered absolute silence to explain the initial delay between 28th May 2026 and 11th June 2026. 16.In line with the Court of Appeal finding in Bi-Mach Engineers Ltd v. James Kahoro Mwangi [2011] eKLR the rules of the Court must be respected and followed; equity cannot aid a party that displays procedural indolence or unexplained gaps of time. Because the Applicant failed to explain the initial lapse of time before even going to Kisumu, the prayer for enlargement of time must fail. 17.A High Court sitting on a reference against a Taxing Officer's decision does not act as a standard appellate court. It will only interfere with the Taxing Officer’s exercise of discretion if it is demonstrated that the officer erred in principle, acted on a wrong understanding of the law or if the fees awarded are so grossly excessive or low as to indicate an error of principle. 18.I have taken the liberty to consider the impugned ruling. It can be seen that a review of the Taxing Officer’s assessment reveals that he meticulously evaluated each item against the provisions of Schedule 4, Part II of the Auctioneers Rules in the following manner:i)Item 3 (Investigations): The Taxing Officer correctly reasoned that an auctioneer must carry out preliminary verification to locate and verify the existence of specific assets before executing an attachment. The sum of Kshs. 10,000/= was found reasonable and within judicial discretion.ii)Items 4 & 6 (Service & Transport): Although the Applicant alleges service was via WhatsApp, the Taxing Officer noted that the Applicant failed to supply screenshot evidence to verify this assertion. Conversely, Paragraph 11 of Part II of Schedule 4 explicitly provides for traveling expenses at three times the Automobile Association scale. The Taxing Officer committed no error of principle in allowing these items based on the records before him.iii)Item 17 (Commission): The Applicant contends that commission should be based on the decretal sum (2% of Kshs. 863,208/=). However, the Taxing Officer correctly guided himself by the Court of Appeal precedent in National Industrial Credit Bank Limited v. K. Ndegwa Auctioneer [2005] eKLR. The Court of Appeal settled the law that an auctioneer's commission under Paragraph 4 of Part II must be assessed based on the value of the property attached/proclaimed not the decretal amount. Given that the proclaimed motor vehicle was valued at Kshs. 3,000,000/=, a 2% calculation would equal Kshs. 60,000/=. The Respondent only charged Kshs. 48,160.40/=, which sits comfortably below the legal ceiling. No error of principle can be imputed.iv)VAT Charges, it is noted that the auctioneer herein runs a business which is liable to pay this statutory levy under the Vat Act and hence, it is not the business of the Applicant to concern itself with the Respondent’s obligation with the entity dealing with the same (KRA). The Respondent was obligated to subject the sums to the requisite percentage under the Vat Act. 19.In the Case of Ramesh Naran Patel v Attorney General & Another [2012] KEHC 2033 eKLR it was held that ‘‘The complex elements in the proceedings which guide the exercise of the Taxing Officer’s discretion must be specified cogently and with conviction…Each of these elements must be broken down with specificity and not by mere generalizations’’. 20.Regarding the stay of execution, the Applicant has completely failed to meet the mandatory conditions of Order 42 Rule 6(2) of the Civil Procedure Rules as underscored in Kenya Shell Ltd v. Benjamin Karuga Kibiru [1986] eKLR: Mere dissatisfaction with a taxation ruling or the obligation to pay a legal debt does not amount to substantial loss. The Applicant supplied no financial evidence showing that paying the assessed sum of Kshs. 135,683/= would cause irreparable harm or cripple its business operations. Further, the Applicant did not offer any form of security nor did it show any willingness to deposit the taxed sum into court pending the reference. Such omission is fatal to an application for stay of execution. 21.In the final analysis, this Court finds that the Applicant's Chamber Summons Application dated 15/6/2026 is heavily time-barred, the delay remains entirely unexplained and that the intended Reference is devoid of any merit either in fact or in law. Accordingly, the Applicant’s Chamber Summons Application dated 15th June 2026 is hereby dismissed in its entirety with costs to the Respondent and that any interim orders earlier issued are hereby vacated. DATED AND DELIVERED AT SIAYA, THIS 15TH DAY OF JULY 2026D.KEMEIJUDGEIn the presence of:Mola Ahenda for M/s Wangusi…………….for ApplicantAwino………………………………….for the RespondentM/s Maurine…………………………….Court Assistant