Southern Shield Holdings Limited v Tandala Investment Limited & 2 others [2022] KEHC 12941 (KLR)

Southern Shield Holdings Limited v Tandala Investment Limited & 2 others (Civil Suit E249 of 2018) [2022] KEHC 12941 (KLR) (Commercial and Tax) (16 September 2022) (Ruling)

Neutral citation: [2022] KEHC 12941 (KLR)

Republic of Kenya

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

Commercial and Tax

Civil Suit E249 of 2018

A Mabeya, J

September 16, 2022

Between

Southern Shield Holdings Limited

Plaintiff

and

Tandala Investment Limited

1st Defendant

Hamerpop Investment Company Limited

2nd Defendant

Trogon Investment Company Limited

3rd Defendant

Ruling

1. This is a ruling on the plaintiff’s Chamber Summons dated 24/8/2022. The same was brought pursuant to rule 11(4) of the Advocates (Remuneration) Order, section 10 of the Judicature Act, rules 3(1) and (2) of the High Court (Practice and Procedure Rules) and section 3A of the Civil Procedure Act.

2. The plaintiff prayed for extension of time for filing a reference against the decision of the Taxing Master dated 11/2/2022.

3. The application was supported by the affidavit of Abdulali Kurji, its director, which set out the grounds of the application. These were that; the Bill of Costs filed by the defendants was taxed vide a ruling dated 11/2/2022; that a certificate of taxation was issued on 14/4/2022. The defendants took out execution proceedings and were seeking to attach and sell the plaintiff’s shares in Fidelity Shield Company Limited.

4. Mr.Kurji averred that the plaintiff was initially represented by the firm of Makhanu Odhiambo & Co. Advocates. Their relationship deteriorated and the plaintiff engaged the firm of Mohammed Muigai Advocates who kept it in the dark on the proceedings herein.

5. The plaintiff then engaged the firm of Kinyua Mwaniki & Wainaina Advocates to peruse the court file. The said firm found that the ruling on the taxation of the Bill of Costs was done on 11/2/2022 and a certificate of taxation issued on 14/4/2022.

6. On or about 4/8/2022, the plaintiff received email communication from the firm Mohammed Muigai Advocates advising that the defendants had made an application to attach and sell its shares and that it was no longer acting for the plaintiff.

7. In the premises, the plaintiff pleaded for the extension of time to file a reference. That the failure to file the same on time was not deliberate as explained.

8. The defendants filed joint grounds of opposition dated 31/8/2022. They asserted that there had been inordinate delay in bringing the application. That the delay had not been explained. That the plaintiff, as the client, had a duty to follow up on its case and cannot rely on the mistake of an advocate to escape from its own inaction. That there was no power to stay the execution of taxed costs. That in any event, the application was incompetent an abuse of the court process.

9. The defendants concomitantly filed a replying affidavit sworn on 31/8/2021 by Trophimus Kiplimo, their legal officer.

10. It was averred that after the certificate of taxation was issued, the defendants’ advocates engaged the plaintiff’s advocates with a view of settling the matter but in vain leaving the defendants with no choice but to seek the enforcement of the award.

11. That the plaintiff’s advocates were present during the mention on 21/7/2022 but did not appear for the further mention held on 3/8/2022. On 12/8/2022, the court issued the prohibitory order as sought by the defendants. The defendants should be left to enjoy the fruits of the judgment on costs.

12. Rule 11(4) of the Advocates Remuneration Order provides that the High Court shall have the discretion to enlarge the time for lodging a reference notwithstanding the expiry of the 14 day period prescribed for the reference from the taxing master’s decision on costs.

13. In Nicholas Kiptoo Arap Korir Salat v Independent Electoral and Boundaries Commission & 7 others [2014] eKLR, the Supreme Court held that: -“a)Extension of time is not a right of a party. It is an equitable remedy that is only available to a deserving party at the discretion of the Court;b.A party who seeks for extension of time has the burden of laying a basis to the satisfaction of the courtc.Whether the court should exercise the discretion to extend time, is a consideration to be made on a case to case basis;d.Whether there is a reasonable reason for the delay. The delay should be explained to the satisfaction of the Court;e.Whether there will be any prejudice suffered by the respondents if the extension is granted;f.Whether the application has been brought without undue delay;…”

14. The bill of costs filed by the defendants was taxed vide a ruling dated 11/2/2022. Consequently, a certificate of taxation was issued on 14/4/2022.

15. The defendants applied for enforcement of the award of costs by the issuance of a prohibitory order on all the shares held by the plaintiff in Fidelity Shield Insurance Company Limited and the court issued the prohibitory order sought on 12/8/2022.

16. The plaintiff averred that it did not file the reference on time because its then advocates, Mohamed Muigai Advocates, failed to inform them of the outcome. That it only received information from its advocates that a certificate of taxation had been issued in June 2022 but did not get further details from its advocates.

17. If the plaintiff was aware that a certificate of taxation had been issued in June 2022, why didn’t it file the present application then. It waited for yet another two months to lodge the present application. In my view, there had been inordinate delay which was not explained.

18. Page 4 of the exhibit ‘TK1’ in the defendant’s replying affidavit is an email dated 21/4/2022. In that email, the defendant’s advocates informed the plaintiff’s advocates that a certificate of taxation had been issued by the court. The plaintiff's advocate then noted that it would forward the certificate to its client. It is not clear whether or not the plaintiff was informed of that fact or not.

19. I have always known it to be the position that where a client puts blame in an advocate such as in this case, the application should be served upon the ‘errant’ advocate and proof of service filed with the Court. That will give an opportunity to comment on the allegations being levelled against him/her. In most cases, it is the litigants who are in the wrong and would like to hide under ‘mistake of an advocate’.

20. The view I take is that, where such application is made and the party to be blamed is the previous advocate, the application must be served upon the advocate for him/her to answer. If he fails to answer, that vindicates the client as the advocate would be open to be held to have conducted himself negligently and susceptible to the normal sanctions.

21. In the present case, all blame have been heaped upon the firm of Mohamed Muigai & Company who were never served with the application. The Court is unable to establish where the blame lies.

22. The emails produced show that the plaintiff was well aware of the certificate of costs and subsequent proceedings in the matter. In this regard, the allegation that the plaintiff was kept in the dark by its previous advocates seems unlikely.

23. Accordingly, the Court holds that the plaintiff failed to satisfactorily explain the delay.

24. Further, granting the orders will highly prejudice the defendants. They have taken steps to realize the fruits of their judgment. Any further delay would be prejudicial to them.

25. Accordingly, the Court finds no merit in the application dated 24/8/2022 and dismisses the same with costs.It is so ordered.

DATED AND DELIVERED AT NAIROBI THIS 16TH DAY OF SEPTEMBER, 2022. A. MABEYA, FCIArbJUDGE