Misagga & Another v Nsubuga (Taxation Appeal 3 of 2022) [2023] UGCommC 250 (30 August 2023)

Full Case Text

### THE REPUBLIC OF UGANDA

### IN THE HIGH COURT OF UGANDA AT KAMPALA

### ICOMMERCTAL DMSIONI

## TAXATION APPEAL NO. 03 OF 2022 ARISING FROM TAXATION APPLICATION NO. 337 OF 2O2I (ARISING FROM MISCELLANEOUS APPLICATTON NO. 889 OF 2018) (ALSO ARISING FROM CrVrL SUrT NO. 507 OF 2015)

1. BEN IMMANUEL MISAGGA

2. JOHN BOSCO KASASIRA: : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : :APPELLANTS VERSUS

# RICHARD NSUBUGA T/A NSUBUGA & CO. ADVOCATES

& LEGAL CONSULTANTS:::::::::::::::::::::::::::::::::::::::::RESPONDENT

### BEFORE: HON. LADY JUSTICE ANNA B. MUGENYI RULING

This miscellaneous appeal is brought by way of Chamber Summons under Section 62(l) of the Advocates Act, Regulation 3 of the Advocates (Taxation of Costs) (Appeals and References) Regulations Sl 267-5 for orders that the taxation award of UGX 42,770,5241 and UGX 11,228,6581 as instructions fees allowed in T/A No. 337 of 2021 be set aside for being excessive, unconscionable, oppressive an unlawful; that the two Bills of Costs be referred back to the Taxing Master for retaxation and for costs of the application.

### Grounds of the Appeal

The Application is supported by the affidavit of Mr. Ben Immanuel Misagga, the l't Appellant, and the grounds raised are briefly that the Appellants enlisted the services of the Respondent to defend Civil Suit No. 507 of 2015, upon which th Respondent filed a Miscellaneous Application for the dismissal of the suit and i was allowed. He then filed an application for an order to tax the Advocate-clien Bill of costs which was granted and allowed, so the parties had a pre-taxatio meeting where they opposed the instruction fees as being excessive.

The Taxing Master allowed and awarded UGX 42,770,5241 and UGX 11,228,658 in TA No. 337 of 2021 in favour of the Respondent, and the Appellants bein dissatisfied with the taxation award for being excessive, unconscionable oppressive and not in accordance with the law filed this Application on the ground that the Taxing Master did not exercise his discretion judiciously thereb occasioning a miscarriage of justice and that the excessive award is a bar an deterrence to litigants.

The Application was opposed by an affidavit in reply sworn by Richard Nsubu the Respondent wherein he raised an objection on the competence of the 1 Appellant's affidavit in support on grounds that the signature was different fro his known signature. In specific response to the application, he avers that th Taxing Mdster arrived at the decision based on paragraph I of the 6fr Schedule the Advocates (Remuneration and Taxation of Costs) (Amendment) where th value of the subject matter is ascertainable from the pleadings. He added that th objection raised that the dismissal was at the beginning of the proceedings w ovemrled.

ENN \

That the Respondent drew a bill ofcosts which they served on the Appellants an it was upon their failure to settle that they filed Miscellaneous Application No. 8 of 2018 and the Bill of Costs was attached. Upon the order of taxation bein granted, the same Bill of Costs was drawn in accordance with the Advoca (Remuneration and Taxation of Costs) Regulations as amended as the old Bill was drawn according to the old law. That the Taxing Master did not breach any principles of taxation.

In rejoinder, the I't Appellant contended that he is the one who swore and sign the affidavit in reply. He added that the Taxing Master did not apply well the principles of taxation and that he did not consider the Bill of Costs for UGX 50,894,018/ while awarding the sum of UGX 8,113,685/ and instead used UGX 144,684,2401.

### REPRESENTATION

The Appellants was represented by IWS Muwema & Co. Advocates and Solicitors whereas the Respondent was represented by lvTS Nsubuga & Co. Advocates and Legal Consultants.

#### RULING

Counsel for the Appellants, in their written submissions raised two issues for determination for this Court, namely:

- l. Whether the learned Registrar erred in manifestly excessive and unreasonable Respondent? law and fact in awarding instruction fees to the - 2. What remedies are available to the parties?

### Issue I

Counsel for the Appellants submitted that the hearing of Civil Suit No. 507 of 2015 was not complete and that the Respondent only filed an Application for dismissal of the same which was granted. Therefore, that Counsel did not carry o instructions to the logical conclusion of the case hence the matter was n complicated as no lengthy preparations to research to attract high fees. He add that the Taxing Master should have first considered Civil Suit No. 507 of 2015 separately.

On the issue of the amount, Counsel submitted that a Judge should not interfere except when it is manifestly low or high. He cited case law in support and prayed that the Bill of Costs be sent back to the Taxing Master.

In reply, Counsel for the Respondent submitted that there were two different Bills of Costs in the matter, one for Civil Suit No. 507 of 2015 and Miscellaneous Application No. 889 of 2018; and that they were awarded UGX 39 million and 8 million respectively. On the issue of the instruction fees, he submitted that the value of the subject matter is used for calculation and that it is an ascertainable amount as seen under paragraphs 3 and 6 of the Plaint. He added that when the suit was filed, no counterclaim was filed therefore the only duty was to defend the suit and have it dismissed; and that the advocate's legal skill is what led to the dismissal of the suit. He said a dismissal can be at the beginning or at the end.

Counsel further relied on case law where instruction fees were awarded where matter was dismissed on a preliminary objection. He added that a dismissal can either be at the beginning of the case or at the end as the result is the same, and therefore it is the Court to calculate the instructions fees based on the value of the subject matter. He also cited case law where Court disregarded that the case had not reached logical conclusion. He added that the Taxing Master followed the righ principle as the value of the subject matter is ascertainable.

In rejoinder, Counsel for the Applicant reiterated that the award was excessive and discretion was not judiciously exercised.

Before I delve into whether or not the amount taxed and allowed by the Leamed Registrar was excessive, I would like to make reference to principles of taxation outlined by the Supreme Court ruling in Bank of Uganda verses Banco Arabe Espanol Civil Appeal No. 23 of 1999 where it was held that when the Court is faced with a taxation review, a pertinent principle that must be considered is that the a judge will not interfere with the assessment of what the taxing officer considered to be a reasonable fee except in exceptional cases like where it is shown either expressly or by inference that the taxing officer exercised or applied a wrong principle in assessing or arriving at the quantum of the fee allowed. The same principles were outlined in Premchond Raichand v, Quarry Services (No.3) (r972) EA 1e2.

From the above, it is not enough that the amount appears to be excessive but the taxing officer must have erred in principle in arriving at the excessive amount. In Altorney General Versus Ugando Blanket Manufacturers Limiled SCCS No. 3 o 1999 it was held that:

"The question to be decided is whether it is so excessive as to indicate an error o principle... .... an eruor of principle is not only inferred where an award is manifestly excessive but where there is an express error of principle, a judge will normally remit the matter to the taxing ffice for reconsideration unless he is satisfied that the eruor cannot materially have affected the assessment. "

\$\$

It is this error of principle that entitles the Court to interfere with a taxation decision of this nature (See Arthur v. Nyeri Electricity Undertaking (1961) EA 492). In this instant case, the Appellants argue that the amount allowed is excessive because the Respondent did not pursue the matter to its logical conclusion and, therefore, that they are not entitled to the entire amount awarded. Whereas Counsel for the Appellants argues that the case was dismissed before the main case could go through full trial, Counsel for the Respondent on the other hand argues that it is due to their skill that the dismissal was secured and that the dismissal disposed of the entire matter.

A similar issue was raised in the case of *Haruna Mubiru & 3 Others versus* Nakato Bushira & Another COA Civil Reference No. 147 of 2012 where the Trial Judge held that the taxing master had failed to take into account the fact that the interlocutory application was not complex and was very brief, therefore he erred on principle in assessment of fee to be allowed thus making an excessive award. In addition, the Judge held that it was not clear whether the taxing master had treated the matter as interlocutory or as final because it has a bearing on the instruction fees; and that the best test to determine is whether the judgment or ruling made finally disposes of the rights of the parties.

Going by the above test, the dismissal in this case finally disposed of the case and no fresh matter has been filed. Therefore, I have no doubt that there was no error in principle in determining the fees. In addition, it must be noted that while the Court of Appeal and Supreme Court mostly rely on the discretion of the Court to review amounts allowed in order to determine whether or not they were excessive, the High Court and the subordinate Courts apply The Advocates (Remuneration & Taxation of Costs) Regulations in taxing bills of costs.

In this instant case, the leamed Registrar in his ruling, Annexure E to the Affidavit in support to the Chamber Summons, clearly cited Regulation I (l) of the Sixth Schedule to the Regulations and went ahead to state that the value of the subject matter was ascertainable as it had been pleaded in paragraphs 3 and 6 ofthe plaint, and he had applied the relevant scale and arrived at UGX 42,770,524/ as instruction fees in Civil Suit No. 507 of 2015 and UGX 11,228,658 for Miscellaneous Application No.889 of 2018.

ln Stonbic Bank Uganda Lld & 2 Ors v ll/estern Highland Creameries Ltd & Anor Taxation Appeal No. 5 of 2013 where the taxation had been applied using an incorrect value of the subject matter, the Judge held that " lnstruction fees shall be calculated on the basis of the correct value of the subiect matter as can be discerned from the plaint. " In this case, calculation of instruction fees was based on the Plaint, hence no error in principle arises or accrues.

Subsequently, I frnd that the leamed Registrar followed the law on taxation an therefore there was no error as to principle which led to a taxed amount in issue. Whereas on the face of it the amount may seem excessive as the matter did not go through full trial, the dismissal led to the final disposal of the suit and the taxati was rightfully done in accordance with the law on taxation.

In the premises, therefore, this appeal lacks merit and fails. It is hereby dismissed.

Costs of this Appeal are awarded to the Respondent.

ffv:rn.6 L,.\.

HON. LADY JUSTICE ANNA B. MUGENYI

DATED:301812023