Menezes & Partner Advocates v Spire Bank Limited (Formerly known as Equatorial Commercial Bank) [2022] KEHC 9941 (KLR)

Menezes & Partner Advocates v Spire Bank Limited (Formerly known as Equatorial Commercial Bank) (Miscellaneous Civil Application E445 of 2020) [2022] KEHC 9941 (KLR) (Civ) (12 May 2022) (Ruling)

Neutral citation: [2022] KEHC 9941 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Law Courts)

Civil

Miscellaneous Civil Application E445 of 2020

DO Chepkwony, J

May 12, 2022

In the Matter of the High Court Misc. Application No.326 of 2019; Menezes & Partners Advocates versus Spire Bank Limited (formerly known as Equatorial Commercial Bank)

Between

Menezes & Partners Advocates

Applicant

and

Spire Bank Limited (Formerly known as Equatorial Commercial Bank)

Respondent

Ruling

1. This is a Ruling in respect of an Application is dated October 27, 2020 and is seeking for orders that;1)Judgment be entered for the sum of Kshs.681,471 being the Applicant/Advocates taxed and certified costs in Milimani H.C Miscellaneous Application No .326 of 2019;2)The Applicant be awarded interest at the rate of 14% per annum, from June 4, 2019(being the 30th date from the date on which the Bill of Costs was served upon the Respondent) as provided for at Part 1 paragraph 7 of the Advocates Remuneration Order and Rules;3)A decree be issued forthwith;4)The Honorable court be pleased to issue such orders and give such directions as it may consider appropriate to meet the ends of justice; and,5)The Respondent be condemned to pay the Applicant’s costs of this Application.

2. The application is premised on the grounds on the face of the application and the dispositions in the Supporting Affidavit of Pauline W. Kamunya sworn on October 27, 2020. It is therein stated that the Applicant/Advocate filed an Advocate/Client Bill of Costs datedApril 26, 2019, which Bill the Respondent failed to Respond to despite service. As a consequence, the same was taxed for Kshs.681,471 and a Certificate of Taxation dated July 17, 2020 issued. That the said Certificate of Taxation was duly served upon the Respondent who is yet to settle the taxed bill. Further, it is evident that the Respondent has intentionally refused to settle the taxed Bill due to the Applicant/Advocate, a result of which the Applicant has been denied the enjoyment and use of the monies due. It is only fair that interest be granted as prayed. It is the Applicant/Advocate’s prayer that it is fair and just that Judgment be entered on the basis of the Certificate of Taxation to enable the Applicant/Advocate execute against the Respondent.

3. The Application is opposed by the Respondent in its Replying Affidavit sworn by John Wageche on March 15, 2021, where it posits that they have not refused to settle the monies due to the Advocate/Applicant. According to the Respondent, the same has never been brought to its attention by the Applicant herein in such a manner envisaged by them due to the nature of relationship that existed between the parties. Also, it is the Respondent’s contention that it got to know of the monies claimed when it was served with the instant Application by the Applicant/Advocate. The Respondent contends that due to the nature of their relationship with the Applicant, it has always exercised itself in a manner of goodwill and will always be willing to settle the sums due. The Respondent avers that upon realizing the Advocate’s claim it instructed its advocate to seek the settlement of the claim where the Applicant gave an opportunity for the same and the Respondent drew up a Banker’s Cheque No.08880 for the sum of Kshs.681,471 as per the Certificate of Taxation in favor of the Advocate/Applicant. That the Advocate/Applicant rejected the Banker’s cheque issued to it and demanded for more money than what is in the Certificate of Taxation. He states that the Advocate/Applicant is demanding for the full amount in the invoice without subjecting the same to the statutory deductions of Withholding and Value Added Tax which in the Respondent’s view is tantamount to tax evasion since this is professional fee that is subject to Withholding Tax and Value Added Tax. The Respondent goes on to contend that it has demonstrated goodwill in settling the monies due to the Applicant but it is the Applicant who is hell-bent in litigating over it and wasting the precious judicious time and as such, the Respondent is asking this court to direct the Applicant to accept the amount as per the Certificate of Taxation, net of the statutory deductions. The Respondent also contests the award of interest as proposed by the Advocate/Applicant and states that if there is any interest, the same should accrue from August 19, 2020 being the date of the Ruling and/or issuance of the Certificate of Taxation. Further, that in the event this court allows the Application, the same should be subject to the statutory deductions of Withholding and Value Added Tax.

4. The Advocate/Applicant contends that the Replying Affidavit is marred with falsehood and as such it sought to cross-examine John Wageche on the dispositions he made on behalf of the Respondent in the Replying Affidavit of March 15, 2021. The same was allowed and cross-examination was done on October 25, 2021.

5. On October 25, 2021, the parties took directions that the application be canvased by way of written submissions whereby the Applicant filed their submissions dated November 3, 2021while the Respondents submissions are dated January 13, 2022.

6. Section 51(2) of the Advocates Act states:-“(2)The certificate of the taxing officer by whom any bill has been taxed shall, unless it is set aside or altered by the Court, be final as to the amount of the costs covered thereby, and the Court may make such order in relation thereto as it thinks fit, including, in a case where the retainer is not disputed, an order that judgment be entered for the sum certified to be due with costs.”

7. There is no dispute as to the amount due in the Certificate of Taxation dated July 17, 2020. The same is final and the Respondent is bound to pay.

8. It is not true that the Respondent was not aware of the existence of the Bill of Costs and the existence of a Certificate of Taxation. An Affidavit of Service dated and sworn on May 27, 2019 by Stevenson Mulwa is on record showing that service of the Bill of Costs dated April 26, 2019 and a Notice of Taxation dated May 2, 2019 was effected on May 6, 2019 and the two were stamped by the Respondent in acknowledgment of receipt. No evidence has been tendered to show that the Applicant/Advocate refused to accept a cheque from the Respondent and claimed the statutory amounts.

9. On costs, Rule No. 7 of the Advocates Remuneration Orders reads as follows:“An advocate may charge interest at 14 per cent per annum on his disbursements and costs, whether by scale or otherwise, from expiration of one month from the delivery of the bill to the client, providing such claim for interest is raised before the amount of the bill has been paid or tendered in full.”

10. The taxed costs therefore attract interest at 14% per annum with effect from 30 days after the service of the bill. Evidence of service must be availed (See example Kithi & Co. Advocates –vs- Menengai Downs Ltd Nbi Misc. Appl. No.1069 of 2013 and Kantai & Co. Advocates –vs- Kenya Bus ServicesLtd [2006] eKLR.)

11. The Bill of Costs and the Notice of Taxation were served on May 6, 2019. An Affidavit of Service dated and sworn on May 27, 2019 by Stevenson Mulwa is on record to this effect. The Applicant/Advocate is claiming interests at 14% per annum from 4th June, 2019. This is 30 days from the date of service and is in line with the provisions of Rule 7 above. The Applicant is entitled to costs at 14% per annum from 4th June, 2019.

12. With the foregoing, the Application is allowed as prayed.It is so ordered.

RULING DELIVERED VIRTUALLY, DATED AND SIGNED AT NAIROBI THIS 12TH DAY OF MAY, 2022. D. O. CHEPKWONYJUDGEIn the presence of:Mr. Olieti for Respondent