Gichuki King’ara & Company v Kingorani Investments Limited & 2 others [2022] KEHC 9794 (KLR)

Gichuki King’ara & Company v Kingorani Investments Limited & 2 others (Miscellaneous Civil Application 510 of 2012) [2022] KEHC 9794 (KLR) (Civ) (6 May 2022) (Ruling)

Neutral citation: [2022] KEHC 9794 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Law Courts)

Civil

Miscellaneous Civil Application 510 of 2012

JK Sergon, J

May 6, 2022

Between

Gichuki King’ara & Company

Applicant

and

Kingorani Investments Limited

1st Respondent

Transfleet Limited

2nd Respondent

Transfleet EPZ Limited

3rd Respondent

Ruling

1This ruling is the outcome of two applications. The first is the chamber summons dated June 17, 2021 taken out Triple O K law, LLP advocates whereof it sought for the following orders:i.The honourable court be pleased to order stay of execution to recover taxed costs arising from the decision of the taxing officer honourable L. Mbacho delivered on May 24, 2021 pending the hearing and determination of this application.ii.The decision of the taxing officer delivered on the 24th May 2021 in respect of the Bill of Costs dated September 14, 2021 be set aside entirely.iii.The costs of this application be provided for.

2The summons is supported by the affidavit of James Abiam Mugoya Isabinye. The firm of Gichuki King’ara & Co. Advocates filed grounds of opposition and a replying affidavit sworn by Peter Gichuki King’ara to oppose the summons.

3The second application is the motion dated October 25, 2021 taken out by the firm of Gichuki King’ara & Co. Advocates which firm filed the affidavit sworn by Peter Gichuki King’ara in support of the motion. In the aforesaid motion the applicant sought for the following orders:a)THAT judgment be entered for the sum of Kshs.3,537,733/= taxed as certified in the certificate of taxation dated and issued on October 19, 2021 by the Deputy Registrar Hon. L. Mbacho as due to the applicant/advocate with interest thereon at 14% until payment in full.b)THAT the costs of this application and the suit be awarded to the applicant.

4The two applications were ordered to be dealt with together and to be disposed of by written submissions. In the summons dated June 17, 2021, Transfleet EPZ Ltd, Transfleet Ltd and King’orani Investment the 1st, 2nd and 3rd applicants respectively applied for an order for stay of execution to recover taxed costs arising out of the decision of the taxing officer delivered on May 24, 2021 pending the hearing and determination of the instant summons.

5The applicant main prayer is for the decision of the taxing officer to be set aside. The applicants faulted the taxing officer for proceeding to tax the Bill of Costs before first establishing whether there was an agreement which compromised the Bill of Costs. It is also argued that the taxing officer proceeded to tax the Bill of Costs in breach of the order issued on November 7, 2019 by Lady Justice Thuranira.

6It is further argued that the taxing officer erred in taxing the Bill of Costs yet there is express provision of Section 45 (6) of the Advocates Act. The applicants pointed out that Lady Justice Thuranira had expressly stated that it was pertinent for the taxing officer to make a finding on the question as to whether there existed a fee agreement between the parties as per the ruling of Lady Justice Kamau.

7The firm of Gichuki King’ara & Co. Advocate opposed the summons arguing that there is no provision of law for filing a reference on a re-taxation decision. It is further pointed out that the applicants did not file an application before the taxing officer raising the issue of agreement between the parties. The respondent further stated that the applicants did not produce any agreement before the judge and the taxing officer to prove their case.

8Having considered the material placed before this court and rival written submissions plus the authorities cited and supplied, it is clear from the record that the applicants had filed an application dated February 13, 2013 whereof they sought to have the Bill of Costs struck out on the basis that there existed a fee agreement therefore precluding the taxation of the Bill of Costs in view of Section 45(6) of the Advocates Act.

9A letter dated May 2, 2008 evidencing agreement as to remuneration with the respondent in the sum of Kshs.30 million was annexed to the affidavit sworn by James Abiam Mugoya Isabinye sworn on September 13, 2013 filed in support of the motion. Copies of the cheque totaling Kshs.30 million were also annexed to the affidavit. John Ohaga SC also swore a supplementary affidavit in which he deponed that there existed a fee agreement in respect of remuneration between the parties.

10It is also clear from the record that lady Justice Thuranira had expressly stated in her ruling delivered on November 7, 2019 that it was pertinent for the taxing officer to make a finding on the question of the agreement as per the ruling of lady Justice Kamau.

11It is clear from the decision of the taxing officer (Hon. Mbacho) that she did not determine the issue whether or not a fee agreement existed before embarking on the re-taxation of the Bill of Costs. I am persuaded that the learned taxing officer fell into error of principle. In Halsbury’s Laws of England 4thEdition, vol 44(1) Paragraph 180 provides that such an agreement may be contained in a letter or any other document provided that all the terms of the agreement which relate to the remuneration appear in it and are sufficiently specific.

12In the letter dated May 2, 2008, the applicant’s advocate forwarded the two cheques and stated in part that“As agreed, the amount also covers your fees for the criminal case against the client including the constitutional petition and all other related work.”

13In response to the aforesaid letter the advocate (respondent) wrote directly to Mr. James M. Isabinye stating in part as follows:“I acknowledge receipt of the two post dated cheques....... and confirm that upon the same being cleared, I will have no other claims against King’orani Investments Ltd, Transfleet Ltd and you personally in relation to the matter either filed for or against Kenya Commercial Bank Ltd or the matter filed against you and your above companies by Kenya Commercial Bank over the purported debt by Mugoya Construction and Engineering Ltd. The said amount will be received full and final settlement of the fees due in the said case.”

14It is clear in my mind that the parties had entered into a valid fee agreement in accordance with the provisions of Section 45 of the Advocates Act. There is no doubt that the respondent acknowledged receipt of two post-dated cheques.

15The taxing officer was therefore precluded from taxing the Bill of Costs in view of the existence of a fee agreement. No valid certificate of taxation can be issued in the circumstances.

16In the end I find the summons dated June 17, 2021 to be meritorious, it is allowed. Consequently, the decision of the taxing officer (Hon. Mbacho) delivered on 2May 4, 2021 in respect of the Bill of costs dated September 14, 2012 is hereby set aside.

17In the motion dated October 25, 2021, the firm of Gichuki King’ara & Co. Advocates is basically seeking for entry of judgment for the sum of Kshs.3,537,733/= taxed as certified in the certificate of taxation dated and issued on October 19, 2021 by Deputy Registrar Hon. Mbacho as due to the applicant with interest at 14% p.a until payment in full.

18Having come to the conclusion that the taxing officer erred in principle in taxing a Bill of Costs where a valid fee agreement existed, this court set aside the award on costs. It goes without saying that the motion dated October 25, 2021 lacks merit, it shall stand dismissed.

19In the circumstances of this case, a fair order on costs is to order which I hereby do that each party bears their own costs.

DATED, SIGNED AND DELIVERED ONLINE VIA MICROSOFT TEAMS AT NAIROBI THIS 6TH DAY OF MAY, 2022. J. K. SERGONJUDGEIn the presence of:……………………………for the Applicant…………………………for the Respondent