20080118 TZCA Dar es Salaam

L IN THE COURT OF APPEAL OF TANZANIA AT DAR ES SALAAM TAXATION REFERENCE NO. 15 OF 2005 VIP ENGINEERING AND MARKETING LIMITED ......................................... APPLICANT VERSUS INDEPENDENT POWER TANZANIA LIMITED ....................................... RESPONDENT (REFERENCE from the Ruling of the Taxing Officer Mr. S. M. Rumanyika, Deputy Registrar, Court of Appeal of Tanzania t at Dar es Salaam, dated the 22nd day of July, 2005 in Civil Application No. 6 of 2002 RULING 18 September 2007 & 25 January 2008 MROSO, l.A.: ' ( ~ This is a reference to a single judge of th~ Court under Rule 119 (1), (2) and (3) of the Court of Appeal Rules, 1979, henceforth the Court Rules, from a bill of costs as taxed by the Deputy Registrar of the Court as the taxing officer~ The rE:spondent had submitted to the taxing officer a bill of costs amounting to Tshs. 34,044,000/= for ~ ~ . ; taxation. Out of that sum, Tshs.· 25,000,000/= w~s instruction fees. The taxed costs amounted to Tshs. 6,474,000/=, excluding Value Added Tax (VAT). The major part of the taxed costs comprised the Ii I f' ~ ,.I· fl Il . ti I . 1: 1: I! · 1; ., .. ll ' ) ..., 1: I: l ; :I ! Ii \ ) 11 ,l 1! l I 1 I ;J I! I! j I j I: l ' ,l l < r I I J Ii I Ii :lI I' i'I '·, .l I; } d ' ~ Ii ) 1: I I ,l ' i 'f 1 ' i .l ,I 1: Ii " l! J I 'I : ·f .. I j. ' ~ ~~- ' ~ ·L ~\;) l- ,,. 2 instruction fees which were taxed at Tshs. 5,674,000/= and in this - reference, there lies the bone of contention. The applicant contends that the amount is manifestly excessive and it ought to be reduced to an amount that would appear to be "reasonable and just." Under sub-rule (2) of Rule 119 of the Court Rules it is provided as under:- '!4ny person who contends that a bill of costs as taxed is, in all the circumstances, manifestly excessive or manifestly inadequate/ may require the bill to be referred to a Judge and the Judge shall have power to make such deduction or addition as will render the bill reasonable/ and save as provided in this sub- rule/ there shall be no reference on a question of quantum only. " The question here, therefore, is whether the bill of costs as taxed is manifestly excessive as contended by the applicant, which is represented by Mr. Ndyanabo and Mr. Michael Ngalo, learned advocates. Mr. Kesaria, learned advocate, who represents the respondent has argued that the instruction fees as taxed was in fact too low and ought to be adjusted upwards to 25,000,000/= Tshs. as n . I' J 1""' 3 originally claimed in the bill of costs. · Mr. Ngalo submitted that the amount of· instruction ·fees as allowed by the taxing officer was reasonable. The taxing officer in his ruling appeared to say on page 10 that he was agreeing with Mr. Ndyanabo by taxing the instruction fees at Tshs. 5,674,000/=. He said, ''I agree with Mr. Ndyanabo, to the extent that I tax items 1 ta Tshs. 5,674,000/-." I must confess that I have not been able to follow the reasoning which led to that conclusion, but if it is correct that Mr. Ndyanabo advanced arguments which persuaded the taxing officer to agree that the amount of Tshs. 5,674,000/= as instructions fees was reasonable, then he has no cause to complain that the amount as taxed was manifestly excessive. Mr. Kesaria's line of argument was that the amount at stake was some 50 billion Tshs. and that the amount of Tshs. 25,000,000/= which was claimed as instruction fees was only 0.05% of it. With respect, since Mr. Kesaria had withdrawn his Notice of Cross-reference he cannot be heard to argue that the taxed amount _, j' I. I ,, .I i I j l .I I I l • I I .I ,I l ' '1l . '. I i ' 1 j I t lI ~ I. j r ~ J I , '.1 4 is ''on the low side" and even if it were, that would not provide justification for this Court to interfere. He would have to show in a cross-reference that it was manifestly inadequate, and not just that it was low. In structuring their respective arguments Mr. Ndyanabo and Mr. Kesaria used differing amounts as their basis. Mr. Ndyanabo considered that instruction fees should be claimed on the basis that 2.8 billion Tshs. was at stake whereas Mr. Kesaria was of the view that the amount at stake was Tshs. 50 billion. It is not clear from the . . ruling of the taxing officer on which amount the instruction fees was based, but it is more probable that he considered Tshs. 2.8 billion to be the amount at stake. The taxing officer as well as Mr. Ndyanabo and Mr. Kesaria all erred in appearing to think that the taxation of instruction fees is done by considering a particular percentage of an amount claimed or decreed in a suit. Paragraph 9 of the Third Schedule to the Court Rules on the Taxation Of Costs does not provide for such procedure. The taxing officer is only required to consider what is reasonable in 1' I: I! ' i .. 5 the circumstances of each case, bearing in mind the nature, importance, difficulty in the case and the interest of the parties and any other relevant factor. Mr. Ngalo is correct, therefore, in submitting that the amount at stake, whether it was Tshs. 2.8 billion or Tshs. 50 billion, was not an overriding factor and the percentage factor thereof was irrelevant. Having made the above observation, I should say that Mr. Ndyanabo has not, with respect, demonstrated that the taxed amount of Tshs. 5,674,000/= was manifestly excessive so as to entitle this Court to interfere with the wide discretion enjoyed by a taxing officer. There is no ground, therefore, for reducing the taxed amount of instruction fees nor is there a basis for enhancing that amount as contended by Mr. Kesaria. The reference is dismissed with costs. DATED AT DAR ES SALAAM this 18th day of January, 2008. J. A. MROSO JUSTICE OF APPEAL 6 I certify that this is a true copy of the original. l ... 1 \:., I It ~ 11 I I ,~. -, i fi ~-"' ~ Ii '·-.. , i ...~.-·. <{~ ' ',;) ,!;;, •· . ~ ; {, ' .•-t·' ,•. ·-}~- ,',."f. l j :iI ! q \ J f