Ogola t/a Ogola Okello & Company Advocates v Ramboo Colourcan Limited & another [2022] KEHC 13721 (KLR)

Ogola t/a Ogola Okello & Company Advocates v Ramboo Colourcan Limited & another (Miscellaneous Civil Application E118 of 2022) [2022] KEHC 13721 (KLR) (Commercial and Tax) (7 October 2022) (Ruling)

Neutral citation: [2022] KEHC 13721 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Commercial Courts Commercial and Tax Division)

Commercial and Tax

Miscellaneous Civil Application E118 of 2022

DAS Majanja, J

October 7, 2022

Between

Daniel Ochieng Ogola t/a Ogola Okello & Company Advocates

Applicant

and

Ramboo Colourcan Limited

1st Respondent

Kellico Limited

2nd Respondent

Ruling

1. What is before the court is the advocate-client bill of costs dated February 14, 2022 (‘’the bill of costs’’) in which the advocate claims Kshs 704,635. 35 on account of services rendered to the respondents to draw and cause registration of a legal charge for Kshs 18,786,750. 00 over LR No 209/14907 Ramboo Colourcane Limited, a security facility by KCB Bank Kenya Limited (formerly Kenya Commercial Bank Limited) by a letter of instruction dated July 14, 2010.

2. In response to the application, the respondents filed a notice of preliminary objection dated February 22, 2022 objecting to the bill of costs on the ground that it is time barred on its face as the last service was rendered on October 13, 2010 hence under section 4(1)(a) of the Limitation of Actions Act (chapter 22 of the Law of Kenya), it is statute barred and ought to be struck out. The respondents urge that six years under the aforesaid statute expired on September 13, 2016 when the bill ought to have been filed.

3. In support of their case, the respondents cite Muri Mwaniki and Wamiti Advocates v Gateway Insurance Company Ltd [2018] eKLR and Abincha and Company Advocates v Trident Insurance Company Limited [2013] eKLR to submit that any claim or action for an advocate’s costs is subject to the statute of limitation and that time begins to run from the date of completion of the work or lawful cessation of the retainer hence the bill of costs should be struck out.

4. The advocate responded to the objection through his replying affidavit sworn on July 8, 2022. He admits that in 2009, he was retained by the respondents to act for them in various legal matters including reviewing agreements and representing them in various court cases. That it is on the basis of this oral agreement that he was able to act for them in those matters including advances made to them by Kenya Commercial Bank until 2018 when the relationship broke down when the respondents appointed a new firm. That once the retainer was terminated in 2018, he demanded fees whereupon the Respondents paid him Kshs 1, 000,000. 00 on account which was duly acknowledged. Despite several requests, the respondents failed to pay him outstanding fees causing him to file the bill of costs.

5. The advocate accepts that a retainer is essentially a contract for professional services between an advocate and client which is subject to the limitation period in section 4(1) of the Limitation of Actions Act and the period began to run from the lawful cessation of the retainer. In this case, he argues that the retainer was terminated in the month of October 2018 and as such, time started to run from the month of October 2018 hence the bill of costs is not time barred.

6. In response to the advocates, the respondents relied on the affidavit of Kavan Kalsi sworn on July 13, 2022. He deponed that the parties agreed on a general retainer but that legal fees were agreed on a case by case basis and would be paid on account with each individual file. Upon conclusion of the matter, whether litigious or non-litigous, the advocate would be paid upon conclusion of the matter.

7. As regards this matter, Mr Kalsi depones that it is incomprehensible that the advocate would file the bill of costs 12 years after the transaction was completed in 2010 bearing in mind that the respondents’ books of account closed on expiry of 6 years after conclusion of a matter. The respondents deny that they paid any money on account as alleged and that advocate has not adduced any evidence to support this allegation.

8. I have considered the parties’ submissions in the matter and the issue is whether the bill of costs is time barred. The bill of costs is clear that the services were rendered and completed in 2010. Since the services were rendered in 2010 and payment became due in 2010, under section 4(1) of the Limitation of Actions Act, the bill of costs is statute barred.

9. The advocate argues that the retainer was general in nature and that part payment was made in 2018. I disagree because item No 2 of the bill of costs is clear that he was instructed by a letter dated July 14, 2010. This letter is what gave life to the retainer in respect of the subject matter which forms the basis of the bill of costs hence the advocate cannot fall back on an oral retainer and general instructions since the retainer in this case was reduced to writing.

10. The other question is whether the respondents paid Kshs 1,000,000. 00 in 2018 in effect extending the period of limitation from 2018. This payment is only evidenced by the advocate’s own email which is not acknowledged by the respondents. I hold that if the Kshs 1,000,000. 00 was indeed paid in respect of the subject matter, it ought to have been reflected in the bill of costs as a credit. The conclusion I draw is that this amount was paid on account of other instructions hence section 23(3) of the Limitation of Actions Act under which an acknowledgment or part payment extends the period when time begins to run does not apply to this case.

11. For the reasons I have set out above, I hold that the bill of costs dated February 14, 2022 is time barred under the Limitation of Actions Act and is hereby struck out. The advocate shall pay costs of Kshs 25,000. 00.

DATED AND DELIVERED AT NAIROBI THIS 7TH DAY OF OCTOBER 2022. D. MAJANJAJUDGECourt Assistant: Mr M. OnyangoMr Ochieng instructed by Ogola Okello and Company Advocates LLP for the Applicant.Mr Wawire instructed by Wamae and Allen Advocates for the Respondents.