amos njile lili vs amana bank limited another 2022 tzhccomd 166 10 june 2022

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA (COMMERCIAL DIVISION) AT MWANZA REFERENCE APPL. No.01 OF 2021 AMOS NJILE LILI PLTCANT VERSUS AMANA BANK LIMITED S.L.ISANGI AUCTION MART &COURT BROKER Last Order: 03/06/2022 Date of Ruling 10/06/2022 f filed in this Court by way of a Remi^^tion^rder, 2Q|||FgN. No. 264 of 2015. The Chamber d by an affidavit of Mr Amos Njile Lili. |antl||^eeking for the following orders of this Court: 1. That, this Honourable Court be pleased to set aside the decision of Hon. J.M Kareyamaha, Taxing Officer, dated 30th October 2020, in the Bill of Costs No.04 of 2020. 2. Costs. Page 1 of 17 3. Any other and further orders as this Honourable Court deems just and equitable to grant. The Respondent has contested the Application by filing a counter affidavit. On the 03 rd day of June 2022, the parties were made to appear before this Court for the hearing of the application. In terms of appearances, the Applicant^njpyed the services of Mr Benson Florence, learned Beatrice Paul Meivukie, a learned advq^pite as^ell^^^pe; the Respondents. prayed to adopt the affida^^^ supj^^ of misapplication as forming part of h^^^wftiissio^^ He^^bmitted that, the Applicant’s contentic^again^^^ruli^^^ the Taxing Officer is based on the b||is of^e fact thatjhie Taxing Officer exercised 11th Sc^il^^^^) of the G.N. No. 264 of 2015, the .t_ relied on the 9 Schedule as the basis for taxation ^of the in^pctiA fees, hence, acted contrary to what the law ^||scribe view of that, it was Mr Benson’s submission that, ther^^^^misdirection on the part of the Taxing Officer, which resulted into excessive and unjust results as he taxed the item at TZS 8,000,000/-. Mr Benson told this Court further that, according to Order 41 of the Advocates Remuneration Orders of the 2015, GN. No. Page 2 of 17 264 of 2015, Bills of costs incurred in contentious proceedings must be taxed at their appropriate and prescribed rates in the 10th, it xL 11 and 12 schedules to the Order. For that matter, he contended it. that, the Order excludes the 9 schedule which the Taxing Officer relied on, thereby failing to exercise his powers judiciously. Mr Benson submitted further that, in th^ course of awarding costs, the principle is that, costs to tl^e winin^^rty are meant to reinstate him/her to the original po^^^^dis^^^ the costs he incurred in prosecuting thebcase a^^^^^^^rich him. He contended that, the aw^^d ^^the Taxing Officer as instruction fees, to enr^c^ the Respondent, and, for th^fcmatte^fa must be taxed in accordance with the i^uirements of^^lajv,particularly, the 11th Schedule Item l^m)Mi) of Remuneration Orders of the 2015 ’o. 2(»af 2015 Mr Benson contended as a secoi^terounAhat, th^^^ing Officer had failed to take into he ma^i 1|||pect of the instruction fees for defending an applicatioADrawing from the Bill of Costs No. 12 of 2018 same parties herein, and which the Taxing Officer had taxed instructions fees on the basis of Item l(m) (ii) of the 11th Schedule to the Advocates Remuneration Orders of the 2015, GN. No. 264 of 2015, taxing it at TZS 1,000,000/=, Mr Benson contended that, the Taxing Officer was not consistent in exercising his discretion because, in a different Bill of Costs No. Page 3 of 17 4 of 2020, which involved the very same parties, the same Taxing Officer applied the 9 Schedule as the basis for taxing instruction fees. In view of that, Mr Benson contended that, the Taxing Officer had failed to apply the principle of consistency. On his third point, Mr Benson submitted that, the Taxing Officer had applied wrong considerations in taxing the, instruction fees, whereby, on page 4 of the ruling in the Bill of C^||S No. 12 contention that, the calculat^^mu'^^f^fc^^^c^nt claimed in the main case. there ^^>a^^ng consideration on his part and, this Court should be Mlased to overrule the decision of the Taxing Officer. enson attacked paragraph 4 of the Respondent’s counter affidavit, stating that, that paragraph contains untruthful averments. To further support his submission, he referred to this Court the case of Tanzania Rent a Car Ltd vs. Peter Kimuhu, Civil Ref.No.9 of 2020; (CAT) (unreported) at Page 4 arguing that, since the matter was not complex, the amount of TZS Page 4 of 17 8,000,000/ was excessive and the Taxing Officer did not do justice to the case. In response to the Applicant counsel's submissions, Ms Beatrice prayed to adopt her counter affidavit as forming part of her submissions. She told this Court that, the Taxing Officer acted perfectly within the requirements of the law^^ was right in awarding TZS 8,000,000/-as instruction f^ becau^^at was in accordance with the dictates of the 9^^^^^1e Advocates Remuneration Orders of th^15, 2015. > According to Ms Beafr|||^ Schedule to the Advocates Remu^^iori^^ers ^^e 2015, GN. No. 264 of 2015, talks of inst^^wn fees ori^^^s cases to which the Misc. Commercial jOT)licat^^^^4 ||F2020 did not fall. She contended th^^^app^^ions^^^ion in Item No.l (m) (ii) of the l^^^^^ule Adwlafes Remuneration Orders of the 2015^p4. N^^64 of are those which emanates from the Item No.l and, that, in respect of the | Misc. ^^nr^^ial Application No.4 of 2020, the proper guidance, ®is? was under the 8 and the 9 Schedules. it MZ/ZZ ^^^^^^the 8 Schedule, she contended, Item 1 thereof gives th guidance on instructions fees and the 9 Schedule to the Advocates Remuneration Orders of the 2015, GN. No. 264 of 2015 gives the scales or the percentages (%). She contended, therefore, that, on the basis of such %, the Taxing Officer taxed the Bill of Costs in line with the requirements of the law. Page 5 of 17 Ms Beatrice conceded, however, that, in both Bills of Cost No.4 of 2020 and No.12 of 2018, the Taxing Officer was not consistent in his decisions. She contended, however, that, despite of such a concession, that does not mean that the 11th Schedule to the Advocates Remuneration Orders of the 2015, GN. No. 264 of 2015 was applicable. As regards paragraph 4 of her^fidavit, she contended that, there was no reason to have ^xpung^^ecause it was stating the truth since the prelimina^^^^^ion^^^^ contented in Court. She urged this Co^^ thef^^^^fc^iiss this Reference Application with c^^^^ In a brief rejoinder earlier submission in chief.^^^ejoil^^ furf^^that, it was utterly incorrect to use the |||Bchedule to ^^Adv^ates Remuneration Orders of the 2(^5, No. .^^^^O^TOcause the value of the subject mattd|R|^ th^^kpplic^^n” and not the main case whic^^^^^TZS^^OO^^^^As such, the application being not t^^ain s^t, it was^^^vorth that amount and the use of that ^^^^^^^^pwas erroneous. He further rejoined that, |since i^^^s^^n conceded that the Taxing Officer lacked ^onsistent,^ means that he was unable to exercise his discretion j^^^^^^and the current Reference Application should be granted. I have dispassionately considered the submissions made by the learned counsels for the parties herein. Courts have in the past set out conditions upon which a taxation reference would be entertained by the Court in which reference application is filed. Page 6 of 17 In Asea Brown Boveri Ltd vs. Bawazir Glass Works Ltd and another [2005] 1 EA 17, the Court was of the view that: “[a] taxation reference would be entertained either on a point of law or on the ground that the bill as taxed was manifestly excessive or inadequate. In the South African case of Visser vs. Gubb 1981 (3) SA 753 (C) 754H - 755C, the Court did also set another principle, which is of general application even in our jurisdiction, regarding the possible interference with the exercise of the taxing officer’s discretion. It was stated that: -disc^^pn W 1 hxins C^ihcer has not --------- —we---------------------------- exerci^pPms discretjm iudreially and has exercised it impropOy.Jjor example, --- 9— — "wir he should by di^^ardinM^^^s ^^perl^p.ave consicOld, or considering n^^rs w^^,it vgaswnproper for him to havd^^isider^^^ffe had failed to bring ^iis mind||yx^r on the question in issue; or Ae has a^^Fon a wrong principle. The <^^^^^^also interfere where it is of the opinion that, the taxing Officer was clearly ^^png, but will only do so if it is in the same position as, or a better position than, the taxing Officer to determine the point in issue....” (Emphasis added). The above principle was also soundly reflected in the Court of Appeal decision in the case of VIP Engineering & Marketing Ltd vs. Citibank Tanzania Limited (Civil Application 24 of 2019) [2021] TZCA 112 (Neutral Citation). The Court stated, citing the case of Premchand Raichand Ltd Page 7 of 17 and another vs. Quarry Services of East Africa Ltd and others (No. 3) [1972] 1 EA 162, that, "The taxation of costs is not a mathematical exercise; it is entirely a matter of opinion based on experience. A court will not; therefore, interfere with the award of a taxing officer, and particularly where hejs an officer of great experience, mere1|| other." See also the cases of ande and Another vs. Exim Bank,^^atioi^^fere^^^o.l of 2020, (unreported) and tha^^^Jlvah^^ohn^^ Magdalen Shaun, Civil Ref. No. 7 of® 19 (un^ort^^^^iere it was reiterated with emphasisj^at, ^^rcisd^n Officer's discretion, cannot be easfj^^^erfe^^^^^^F he Court, unless there, are excep^^^^^unds^^ w^^ noting^^^'ever, that, powers exercised on the j^^^^d^^^n^^^owers that must be exercised judiciously and not whim, likes or dislikes. Such a principle was from tim|b immemorial where over centuries ago, courts long that discretion should be exercised in accordance with sound and reasonable judicial principles. In Rookey’s Case [77 ER 209; (1597) 5 Co.Rep.99], for instance, the King’s Bench division of the Court in England was of the sound view that:- “Discretion is a science, not to act arbitrarily according to men’s will and Page 8 of 17 private affection: so the discretion which is exercised here, is to be governed by rules of law and equity, which are to oppose, but each, in its turn, to be subservient to the other. This discretion, in some cases follows the law implicitly, in others or allays the rigour of it, but in no case does it contradicts or overturns the grounds or principles thereof, as has been sometim^ ignorantly imputed to this Court. That is a discretionary power, which neith^fc^or any other Court, not even the 1^h^i| acting in a judicial capa^^ is b^th^ constitution entrusted with.” Furthermore, Osborn vs. BOWbf|the UnitedWates, 22 U. S. 738 [1824], Chief Justi^^phn ^^hal^^^pe then was), writing on judicial pox^^^ated ^felloW^bn the subject:- istendekCourts are W mere instruments :o exe: flegal di^mion, a discretion to be exercised i& discernible course prescribed by law; wtjj||B>mat is discerned, it is the duty of the court to follow it. Judicial power is ^|byer exercised for the purpose of giving effect to the will of the judge, always for the purpose of giving effect to the will of the legislature; or, in other words, to the will of the law.” In our own jurisdiction, the cases of Yusufu Same & Another vs. Hadija Yusufu, Civil Appeal No. 1 of 2002 (Unreported) and Lyamuya Construction Company Ltd vs. Board of Registered Trustee of Young Women’s Christian Page 9 of 17 Association of Tanzania, Civil Application No.2 of 2010, (Unreported) have generally commented on how discretion need to be judiciously exercised. It is worth noting, however, there is no hard and fast rule regarding judicious exercise of discretion. It must be guided, however, by the principles of justice, equity and common sense. In a matter of the kind as the one at hapd, whic^^ about exercise of discretion in determining instructi^^^^^ all||Lxj| Costs, it is expected that exercise of su^^iscr^^^^^R^ifig Officer, will be within the ambit ^^^^ost^^le^^escribed by the Rules so that, the same^^no^^d^^^^^^ At rather to compensate or reimbur^^e a^^ates^^the works they have executed in the prepajmm and con^^of tAcase in Court. Now, turmpg l^k to t^^^^rer^^t hand, the Applicant has raised how the Taxing Officer exercise^^fe discrtlhn aiJMgthat, he did not exercise it Schedule, Item (1) (m) (ii) of the ^2015, ^^^264 of 2015, viz-a-vis the 9th Schedule of the ^ame G.N^No.264 of 2015, as the basis for taxation of the ^tftFees- It was argued that, since he applied the latter instead of the former, the Taxing Officer acted contrary to what the law prescribes. As it may be noted from the cases of Asea Brown Boveri Ltd (supra), Visser (supra) or that of VIP Engineering (supra), such a complaints would constitute a valid ground which Page 10 of 17 would warrant interference by the Court with the Taxing Officer’s exercise of discretionary powers. But, was the law wrongly applied? In the case of Masolele General Agencies vs. African Inland Church Tanzania [1994] T.L.R 192 the Court of Appeal of Tanzania was of the view that: 4k "A bill of costs is nothing m^re than tabulated costs, incurred by a pa^^^^e conduct of a case and, which he seel^to reimbursed by the other par^^t is new claim of whatever one thinftk ondjflr .-.I j a ...ilk. IK body of the sulftb % ‘W In the case of Ap|J||a Ha^^are 2Others vs. Exim Bank Tanzania Limped, Application No.2 of 2021 (unreportA, tl|k CoU^^^^g case of Premchand Raichand Lti which was referred with appro™Bpi|||| Cou^^ Appeal in the Tanzania Rent A Car’s case ^^ra)^ted that^pnen determining the quantum of an IcMRving principles need to be considered. thirst, that costs be not allowed to rise to such a level as to confine access to the courts to the wealthy; second, that a successful litigant ought to be fairly reimbursed for the costs s/he had to incur; thirdly, that, the general level of remuneration of advocates must be such as to attract recruits to the profession; and fourthly, that so far as practicable there should be consistency in the awards made, both to do justice between one person and Page 11 of 17 another and so that a person contemplating litigation can be advised by his advocates very approximately what, for the kind of case contemplated, is likely to be his potential liability for costs.” In the case of ECO Bank Tanzania Ltd vs. Double “A” Company Ltd & Others, Commercial Reference No. 2 of 2019, this Court did cite more other factors. Such factor^^clude, the suit amount involved, the nature of the sub^^^iatte^^eater amount of work involved, the complexity^of the^^s^^^di^^^ taken for hearing of the case, just to me^^i bu^^^wo^Wem. The question that flows from all^^^^^pi^^tio^ is whether the Taxing Officer directed <^^^ind^^os^^^^. "To respond to that, one has to lookdecAbn itsellik I have given a||pok at^^ruh^^Athe Taxing Officer in Bill of Costs N||4 ruling (though not part of this RefeA|p, the same parties (i.e., Bill of 201^^The question that arises from such an examiA|on ij^vhere ti^fcre grounds for me to interfere with disSMon in awarding the fees in Bill of Cost No.4 of 2120 which is the subject of this ruling. I think there are founds, a« I will demonstrate. first place, I would agree with Mr. Benson that the Taxing Officer was not consistent. As stated in the case of Premchand Raichand Ltd and another (supra), a case which was authoritatively cited by the Court of Appeal in the case of Tanzania Rent a Car (supra) and VIP Engineering (supra), as far as practicable there should be consistency in the awards of Page 12 of 17 instruction fees. His ruling in the Bill of Costs No.4 of 2020 and his earlier one in respect of the very same parties, in the Bill of Costs No. 12 of 2019 are a mismatch. By not being able to consistently adhere to his earlier approach adopted in taxing instruction fees under the Bill of Costs No. 12 of 2019, when he was taxing the subs^juent Bill of Costs No.4 of 2020 in respect of the very san^p partie^^ threw the parties into the limbo of uncertainty. Ess^^^^^at not be the intention of any decision m^^bec^^^^^^^^ifig instruction fees, consideration sh<^^^^ h^^ ^at, same must be consistent andArec^W>l^^^^t^eason, the % w Taxing Officer's exerc||j^ of ^^creti^^in that regard was injudicious. Secondly^ I ^pk at ^g, I see nowhere time was devoted^^^ses^^ the nj^er in light of the already guidij^^^^y giv(J|Jy thcflBBioritative decisions such as the case ^^renoAand Ltd and another (supra), which by the Court of Appeal in the case of Tanzai^^R^L a Car (supra) as well that of ECO Bank W W Tanzania ®d vs. Double “A” Company Ltd & Others (supra). case of Tanzania Rent a Car Ltd vs. Peter Kimuhu, Civil Ref.No.9 of 2020; (CAT) (unreported) the Court of was of a further view, and indeed instructively on the matters of assessment of quantum payable as instruction fees, that: "in taxation of bill of costs ... the taxing officer, among others, is expected to determine the quantum of the said, fees in Page 13 of 17 accordance with the cost, scales statutorily provided for together with the factors enumerated above." (Emphasis added). In his ruling, however, the Taxing Officer relied and approved the scales given in Schedule 8 and 9 of the G.N. No. 264 of 2015 as the basis for taxation of the instruction fees. This is noticeable on pages 5 to 6 of the ruling of the Taj^^Officer. His bases of calculation was the amount invo^fcfc.the lAk suiti W , IMF which was TZS 600,000,000 for whichA3% of|t wo||||e wS 10,000,000/=. However, he reasoned tha^^nce^^matter did not go to its full trial but en^^ hence, the amount was to be lower^^^ZS ^^^,000^^ Mr Benson hasJplred him ^^hat f^pt arguing that, the Taxing Officer incorrectly ^^^ed Schedule to the Advocates R^^^iera^^ Orders .Athe 2015, GN. No. 264 of 2015 whUj^he va^^>f t^^f^^Knatter was the “Application” and i^n cas^^^^i was for TZS 600,000,000/-. For J^ma^J^hat, the appropriate schedule to use tou^^^e^^n the 11th Schedule, Item (1) (m) (ii) of the 2015, ^G.N.No.^oAbl5. Ord|^ll °f G-N. No. 264 of 2015 is instructive that wlFof costs incurred in contentious proceedings under Part IV of the Advocates Remuneration Order, shall be taxable according to the rates prescribed in the Tenth, Eleventh and Twelfth Schedules to the Order. According to Order 40 (2)(a) contentious proceedings include proceedings in the High Court of Page 14 of 17 Tanzania and all courts subordinate to the High Court where an advocate is allowed to appear. Essentially, the 8th Schedule to the 2015, G.N. No. 264 of 2015 which Ms Beatrice alluded to earlier in her submission, is not applicable to contentious but to non-contentions matters. The 9th Schedule to the 2015, G.N. No. 264 of 2041k is applied basically for contentious proceedings for ^^uidate^^um in original and appellate jurisdiction, and, as n^^^^ed^^W 12th Schedule to the 2015, G.N. No. 1^4 oflhsiHta/l thereof, instruction fees regar^^^^ro^^in^^under that schedule, will be gauged undp|jhe Now, in our matter, at Aid, as^farectly stated by Mr Benson, the Bill of (jppts No.4 of 2^^wasmot emanating from the main suit^It ^igina^^^^m^R^ Misc. Commercial Application 2^^Thisjpjpcation did not proceed to a full h^^^^^ut e^^^ a^lB^eliminary stage following a succ^fcl moulting of^^^tice of objection which was upheld Emitted by Mr Benson, therefore, it was erroneo^^p ^^y the 9th Schedule to the to the 2015, G.N. No. p64 of 20 ^as if the costs emanated from the main suit while in ^^^^^^^emanated from an application arising out of it. As correctly submitted by Mr Benson, the appropriate scales that ought to have been used are those provided for under Item No. 1 (m) (ii) of the 11th Schedule to the 2015, G.N. No. 264 of 2015. The same provides: Page 15 of 17 “1. Instruction Fees: The fee for instructions in the suit shall be as prescribed in these orders: (m) For applications, notices of motion or chamber applications, (including appeals from taxation) From the foregoing, it follows that the Taxing Officer misdirected himself and applied a wrong ^^^in the instruction fees while the same ought ta have^^n^^^in^^ with the scales provided for under Item Schedule to the 2015, G.N. No.2^»^ i|toy >w, had the Taxing Officer applied the into account that the mawP ended at a preliminap stageobserved, he would not have stun^^ int^^e mire thAvarranted an intervention by this Court in resp^^if h^^^^^^Ssed his discretion. the al||we^ this reference application should be allowe^^^^^^yd ZS 8,000,000 as instruction fees is ^^leousl^harged under a wrong scale. The same is ^set aside^^id ^bstituted for TZS 1, 000, 000/- as per the ^l^uiremey of Item No. 1 (m) (ii) of the 11th Schedule to the 2o1wNo. 264 of2015. In the upshot of all that, therefore, this Court settles for the following orders, that: 1. This reference application is hereby allowed. Page 16 of 17 2. The amount of TZS 8,000,000 charged as instruction fees is held to be erroneously charged under a wrong scale and is hereby set aside and substituted for with TZS 1, 000,000/- as per the requirements Page 17 of 17