Mercy Nduta Mwangi t/a Mwangi Keng’ara & Company Advocates v Invesco Assurance Company Limited [2022] KEHC 26981 (KLR)

REPUBLIC OF KENYA

IN THE HIGH COURT OF KENYA AT NAIROBI

CIVIL DIVISION

CIVIL APPEAL NO. 174 OF 2017

MERCY NDUTA MWANGI T/A

MWANGI KENG’ARA & COMPANY ADVOCATES........................... APPELLANT

-VERSUS-

INVESCO ASSURANCE COMPANY LIMITED.................................RESPONDENT

(Being an appeal from the ruling of M’masi, SPM delivered on 31st March, 2017 in Nairobi CMCC No. 11468 of 2006)

JUDGMENT

1. This appeal emanates from the ruling delivered on 31st March 2017 in CMCC NO. 11468 of 2006. The suit was commenced by a plaint filed on 1st November 2006 byMwangi Keng’ara & Co Advocates, (hereafter the Appellant) and subsequently amended.  In the said suit, the Appellant was claiming the sum of Kshs. 81,613. 95/- from Invesco Assurance Company Limited (hereafter the Respondent) on account of an advocate-client bill of costs that was taxed by consent in High Court Miscellaneous Application No. 707 of 2006.

2. The Respondent filed a memorandum of appearance on 30th June, 2015. Subsequently, the Appellant filed a motion dated 11th October, 2016, expressed to be brought under Order 36 Rule (1)(a), (2), (3) & 9 of the Civil Procedure Rules. Primarily seeking that summary judgment be entered against the Respondent in favour of the Appellant in the sums claimed in the plaint and interest thereon.

3. The grounds on the face of the motion were amplified in the supporting affidavit of Mercy Nduta Mwangiwho deposed that on 8th November, 2004 the Respondent instructed her law firm Mwangi Keng’ara & Co. Advocates to defend Milimani CMCC No. 2243 of 2003, instructions that were duly carried out pursuant to the letter of instruction. That on 18th July, 2006 she proceeded to file an Advocate-Client Bill of Costs in High Court Miscellaneous Application No. 707 of 2006 which was taxed by consent on 30th August, 2006. She further deposed that the Appellant was compelled to file the suit in MilimaniCMCC No. 11468 of 2006, as the Respondent had not made any payment against the certificate of taxed costs.

4. The Respondent opposed the motion by an affidavit sworn by one Paul Gichuhi.  The gist thereof was that the parties herein had in 2006 entered into an advocate-client agreement in respect of some 300 files which included the primary suit in respect of which the suit for fees in the lower court had been brought, and that pursuant thereto, the Respondent had made partial payments to the Appellant. The motion was canvassed through written submissions. By its ruling delivered on 31st March, 2017, the lower court dismissed the said motion, provoking the instant appeal. The appeal is based on the following grounds:

“1. THAT the Learned Trial Magistrate erred in law and in principle in failing to enter summary in favor on the Appellant in the sum of Kshs. 81,613/95cts plus interest thereon.

2. THAT the Learned Trial Magistrate erred in law and in principle in failing to award costs of the Application and the suit to the Appellant.

3. THAT the learned Trial Magistrate erred in fact and law in finding that the Respondent’s allegation of payment of the taxed Advocate/Client costs was a triable issue, whereas no documentary proof of the same was adduced before the trial court.

4. THAT the Learned Trial Magistrate erred in law and in principle in holding that there was a defence before the court which raised triable issues, whereas, no draft defence was presented as required by law, and the trial magistrate thereby misdirected herself and arrived at a wholly unjust decision.

5. THAT the Learned Trial Magistrate erred in law and in principle in failing to find that the Advocate/Client costs having been taxed by consent, there was no triable issue requiring a full trial, and thereby occasioned a great injustice.

6. THAT the Learned Trial Magistrate erred in fact and in law, by entertaining the Respondent’s plea to avail oral evidence and documents in a full trial, whereas they had a chance to do so, during the hearing of the application for summary judgment, but chose not to do so.

7. THAT the Learned Trial Magistrate gave no consideration whatsoever to the documentary evidence filed by the Appellant, the pleadings and submissions, and as a result delivered a biased and lop-sided ruling.

8. THAT the Learned Trial Magistrate’s ruling defeats the overriding objectives of the law and the duty of the court, and is an impediment to justice.

9. THAT the Learned Trial Magistrate erred in law and in principle in failing to find that the summary procedure was legal means of obtaining judgment for a liquidated claim, without resorting to a full trial.”

5. The appeal was canvassed by way of written submissions. Although the record shows that due service of all processes in this appeal was effected upon the Respondents through their advocate Gichuki King’ara & Co. Advocates, the Respondents neither attended court, nor filed submissions on being served with those by the Appellant, as evidenced by the affidavit of service sworn by Solomon Mbugua on 25th November 2020.  The appeal therefore proceeded undefended.

6. The Appellant framed three issues for submission. These can be condensed into one broad question, namely, whether the Appellant was entitled to summary judgement and costs, and corollary to that, whether the Respondent had presented a reasonable or tenable defence. Counsel for the Appellant restated the principles applicable in an application for summary judgment as set out in Zola & Another v Ralli Brothers Limited & Another (1969) EA 691 and Gohil v Wamai (1983) KLR 489. He urged the court to evaluate the Respondent’s affidavit in response to the motion considering the principles pronounced in the authorities. Citing other previous litigation between the parties, including Machakos High Court Civil Miscellaneous Application No. 59 of 2016 Mwangi Keng’ara & Co. Advocates v Invesco Insurance Co. Ltd where the Respondent’s defence alleging fee agreements and payment thereon had been rejected, counsel asserted that this court is bound by the said decisions pursuant to section 7 of the Civil Procedure Act and the principle of stare decisis.

7. As to the particular defence raised herein, the Respondent relied on Severino Ambale Makoba v Joginder Singh Behan (1978) eKLRand Ahmednassir Abdikadir & Company Advocates v National Bank of Kenya Limited [2006] eKLR to submit  that no copy of alleged written agreement was produced before the lower court to establish the existence of an agreement between the parties as envisaged in section 45 of the Advocates Act , and besides, the taxation of the advocate’s costs by consent effectively ousted the application of the said section to this matter.   In that regard, reliance was placed on Mercy Nduta Mwangi t/a Mwangi Keng’ara & Co. Advocates v Invesco Assurance Company Limited (2019) eKLR.

8. Counsel faulted the lower court for overlooking the provisions of section 51(2) of the Advocates Act by entertaining claims that matters relating to payment of the sums claimed could only be determined at a full hearing, when there existed a certificate of costs that had not been varied or set aside. Several authorities including High Court Civil Application No. 729 of 2006 Ochieng Onyango Kibet & Ohaga Advocates v Adopt Alight Limited and Lubullellah & Associates Advocates v N. K Brothers Limited [2014] eKLR were cited concerning the finality of a certificate of taxation not varied or set aside.

9. The court has perused the record of appeal and considered the material canvassed in respect of the appeal. The duty of this court as a first appellate court is to re-evaluate the evidence adduced in the lower court and to draw its own conclusions, but always bearing in mind that it did not have opportunity to see or hear the witnesses testify. See Peters v Sunday Post Ltd (1958) EA 424; Selle and Anor. v Associated Motor Boat Co. Ltd and Others (1968) EA 123; William Diamonds Ltd v Brown [1970] EA 11and Ephantus Mwangi and Another v Duncan Mwangi Wambugu (1982) – 88) 1 KAR 278.

10. The Court of Appeal stated in Abok James Odera t/a A. J. Odera & Associates v John Patrick Machira t/a Machira & Co. Advocates [2013] eKLR that:

“This being a first appeal, we are reminded of our primary role as a first appellate court namely, to re-evaluate, re-assess and re-analyze the extracts on the record and then determine whether the conclusions reached by the learned trial Judge are to stand or not and give reasons either way.

11. The lower court in dismissing the motion stated inter alia that:

… “I have considered the application by the plaintiff and the submissions rendered and the authorities cited. I wish to tone down to one cardinal issue which is: Does the defence raise triable issue? This is an issue that raises a prima facie defence which should go for adjudication? As I have observed above I am persuaded that the defence raises many salient issue which are triable because they are disputing the amounts claimed by the plaintiff. Their contention is that the amounts were fully paid and they are ready to prove the same. It was held in the case of PATEL VERSUS E.A CARGO HANDLING SERVICES LIMITED (1974) E.A 75:- “a defence with merit does not mean a defence that must succeed, it means a triable issue that is an issue that raises a prima facie defence and which should go for trial and adjudication.

Having made the above observation I find that the application for striking out the defence and entering a summary judgment does not obtain at this stage…”

12. The grant or refusal of a motion for summary judgment entails the exercise of discretion by the court. The Court of Appeal in Mashreq Bank P.S.C v Kuguru Food Complex Limited [2018] eKLRstated;

“This Court ought not to interfere with the exercise of a Judges’ discretion unless it is satisfied that the Judge misdirected himself in some matter and as a result arrived at a wrong decision, or that it is manifest from the case as a whole that the Judge was clearly wrong in the exercise of discretion and occasioned injustice. Conversely, a court exercising judicial discretion must be guided by law and facts and not ulterior considerations. This much was stated by the Court of Appeal in the case of Mbogo v Shah, (supra)

“…..A  court  of  Appeal  should  not  interfere  with  the exercise of the discretion of a judge unless it is satisfied that the judge in exercising this discretion has misdirected himself in some matter and as a result has arrived at a wrong decision, or unless it is manifest from the case as a whole that the judge has been clearly wrong in the exercise of his discretion and as a result there has been injustice”. [Emphasis added]

See;United India Insurance Co. Ltd v. East African Underwriters (K) Ltd [1985] E.A 898: -

13. The motion in the lower court was brought under Order 36 Rule (1), (2) & (3) of the Civil Procedure Rules. Rules 1 and 2 provide as follows:

“(1) In all suits where a plaintiff seeks judgment for—

(a) a liquidated demand with or without interest;

(b) the recovery of land, with or without a claim for rent or mesne profits, by a landlord from a tenant whose term has expired or been determined by notice to quit or been forfeited for non-payment of rent or for breach of covenant, or against persons claiming under such tenant or against a trespasser,where the defendant has appeared but not filed a defence the plaintiff may apply for judgment for the amount claimed, or part thereof, and interest, or for recovery of land and rent or mesne profits.

(2)  The application shall be supported by an affidavit either of the plaintiff or of some other person who can swear positively to the facts verifying the cause of action and any amount claimed.

(3)  Sufficient notice of the application shall be given to the defendant which notice shall in no case be less than seven days.

2. The defendant may show either by affidavit, or by oral evidence, or otherwise that he should have leave to defend the suit.”

14. It common ground that an advocate-client relationship existed between the parties, and that a certificate of taxation had issued pursuant to taxation by consent, of the Appellant’s bill of costs dated 14th July, 2006. The bill of costs was taxed at Kshs. 70,306/- plus V.A.T. By its affidavit in opposition to the summary judgment motion, the Respondent had contended that parties had in 2006 entered into an agreement on legal fees that covered the primary matter for which fees were claimed in MilimaniCMCC No. 11468 of 2006, and certain payments made pursuant to the agreement.

15. To my mind, this appeal turns on the sole question whether summary judgment ought to have been entered against the Respondent in favour of the Appellant. In Trikam Maganlal Gohil and Another v John Waweru Wamai (1983) eKLR the Court of Appeal stated the following:

“The respondent if he wants leave to defend may show he is entitled to it by affidavit or oral evidence or otherwise. Order XXXV rule 2. So, if the applicant has set out in his affidavit(s) in support of his motion and exhibits facts which are probably true and sufficient to warrant the granting of his prayer for summary judgment the respondent must discharge the onus on him of showing his defence(s) raises triable or bona fide issues. They will be ones of law or fact. If they are of fact, then, bare denials by the respondent or his advocate in a pleading or a letter will not do because there must be a full and frank disclosure of the facts before the court which will be proper and sufficient for it to rule that those issues are raised”.

16. In AttorneyGeneral v Equip Agencies Ltd (2006) 1KLR 10 the same Court spelt out the rationale behind the provisions of Order XXV (now Order 36) as follows:

“The purpose of the proceedings in an application for summary judgment is to enable a plaintiff to obtain a quick judgment where there is plainly no defence to the claim… The summary nature of the proceedings should not, however, be allowed to become a means for obtaining, in effect, an immediate trial of the action, for it is only if an arguable question of law or construction is short and depends on few documents that the procedure is suitable… A defendant who can show by affidavit that there is a bona fide triable issue is to be allowed to defend that issue without condition.”

17. Thus, a defendant confronted with a summary judgment application is required to demonstrate to the court that he has a reasonable defence and that he ought to be allowed to defend. A reasonable defence is one that raises a bona fide,hence prima facie triable issue or issues, though not necessarily one that would ultimately succeed. See the Court of Appeal’s definition of a reasonable defence in the case of Olympic Escort International CO. Ltd. & 2 Others –vs- Parminder Singh Sandhu & another (2009) eKLR.

18. Admittedly, the Appellant had a certificate of taxation in its favour at the time of the motion before the lower court. The same had not been varied or set aside. The Appellant swore that the Respondent had despite taxation of costs by consent failed to settle the taxed costs. The consent in respect of taxation dated 23rd August 2006 and certificate of costs dated 3rd October 2016 were annexed to the Appellant’s supporting affidavit. An unchallenged certificate of taxed costs is final as to costs therein as provided in Section 51 of the Advocates Act:

“1…

(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.”

19. The Respondent in its affidavit sworn in opposition to the motion deposed at paragraph 5 and 7 that:

“5. THAT sometimes in the year 2006, the parties herein duly entered a legal fee agreement in relation to 300 files in the following terms; -

a. That save for matters where Bills of costs are already pending in court and/or taxed which are excluded here from, the basic legal fees in the 300 files in various courts contained in the schedule of claims attached hereto currently in the conduct of the advocates shall be as follows; -

i. instructions fees    Kshs. 27,000

ii. VAT at 16%    Kshs. 4320

iii. Disbursement    Kshs. 8000

Kshs. 39,320

b. That the total fees for the said cases is Kshs. 11,796,000. the clients has on the 6th June paid to the advocates the sum of Kshs. 3,572,821 and the amount owing is 8,223,179.

6…

7. THAT the primary matter for this suit was part of the agreement and monies were advanced in honoring of the fee agreement and which monies are capable of being set off against an order of the court.”

20. From the foregoing, the Respondent had anchored his defence on section 45 (1) of the Advocates Act, which provides:

(1)  Subject to section 46 and whether or not an order is in force under section 44, an advocate and his client may—

(a) before, after or in the course of any contentious business, make an agreement fixing the amount of the advocate’s remuneration in respect thereof;

(b) before, after or in the course of any contentious business in a civil court, make an agreement fixing the amount of the advocate’s instruction fee in respect thereof or his fees for appearing in court or both;

(c) before, after or in the course of any proceedings in a criminal court or a court martial, make an agreement fixing the amount of the advocate’s fee for the conduct thereof;

and such agreement shall be valid and binding on the parties provided it is in writing and signed by the client or his agent duly authorized in that behalf.”

21. Before the lower court, the Respondent did not exhibit the alleged agreement between it and the Appellant or tender any evidence of alleged payments thereon. The precise dates of the alleged agreement and payments are not stated in the replying affidavit, which merely cites the year 2006. Moreover, the taxation by consent, of the Appellant’s bill of costs on 30th August 2006 in Miscellaneous Application No. 707 of 2006 puts paid to the Respondent’s defence. The Respondent could have but did not challenge the bill of costs at the taxation stage or move the court after the issuance of the certificate of costs in a bid to have it set aside or varied. In the impugned ruling, the learned trial magistrate stated inter alia:

“As I have observed above, I am persuaded that defence raises many salient issue which are triable because they are disputing the amounts claimed by the plaintiff. Their contention is that the amounts were fully paid and they are ready to prove the same.”

22. With respect, this finding was not only against the weight of evidence before the Court, but also manifestation of misdirection concerning the onus placed on the Respondent to demonstrate a reasonable defence and the application of the provisions of Section 51(2) of the Advocates to the matter at hand. In the words of Gohil’s case, the Appellant herein had exhibited facts which were probably true and sufficient to warrant the granting of the prayer for summary judgment, but the Respondent had failed to discharge the onus of demonstrating triable or bona fide issues of law or fact to entitle it to leave to defend.

23. In view of the foregoing, this Court agrees with the Appellant that the lower court wrongly exercised its discretion by dismissing the motion for summary judgment and finds that the appeal is merited. Consequently, the Court will allow the appeal by setting aside the dismissal order dated 31st March 2017 and substituting therefor an order that the Appellant’s motion dated 11th October 2016 is allowed in toto. The Appellant is awarded the costs of the appeal.

DELIVERED AND SIGNED ELECTRONICALLY AT NAIROBI ON THIS 17TH DAY OF MARCH 2022

C.MEOLI

JUDGE

In the presence of:

For the Appellant:  Ms. Mwangi

For the Respondent: N/A

C/A: Carol