University of Nairobi v Standard Group Limited (Civil Case 70 of 2017) [2025] KEHC 18270 (KLR) (Civ) (7 February 2025) (Ruling)
Neutral citation:
[2025] KEHC 18270 (KLR)
Republic of Kenya
Civil Case 70 of 2017
Silvia Motari, DR
February 7, 2025
Between
University of Nairobi
Plaintiff
and
The Standard Group Limited
Defendant
Ruling
On 25/09/2023, the court gave orders that the Application dated 18/08/2023 is settled and pending costs for which taxation will be fixed. I have perused the said Notice of Motion Application and note that the orders sought by the Plaintiff therein is that this matter be marked as settled subject to taxation of the Plaintiff’s costs against the Defendant and that costs of the application be provided for. Plaintiff proceeded to file Party and Party Bill of Costs dated 06/10/2023 seeking that its costs be taxed at Kshs 7,999,584. That bill is the subject of this ruling. In opposition to the bill, the Defendant filed submissions dated 24/10/2024. Plaintiff further filed a document headed Applicant’s Rejoinder dated 29/10/2024 and submissions dated 10/06/2024 in support of the bill.The costs seeking to be taxed are the costs of the suit. I note that this matter was instituted vide Plaint dated 24/03/2017 and filed in the High Court at Nairobi on 27/03/2017. Considering the foregoing, I opine that the relevant scale in determining the chargeable costs in the subject bill is Schedule 6 Part A of the Advocates (Remuneration)(Amendment) Order, 2014 (hereinafter referred to as ‘the applicable scale’).Having considered the subject bill, the responses/submissions by parties, and the court record, I proceed to tax the bill under the following heads:UNDISPUTED ITEMSDefendant does not oppose items 4 to 9, 13 to 27, 30, 31, 33, 35, 36, 43, 44, 45, 51, 52, 53, 55 to 63, 67, 68, 69, 71, 77, 78, 80 to 88, 90 to 102, 104, 105, 108, 111 to 123, 124, 129, and 138 to 144. The said items are thus taxed as drawn.I however note that Defendant does not mention items 47 and 49 in its submissions. The same has been taken as though Defendant opposes them and has been taxed under ‘drawing’ and ‘service’ respectively.INSTRUCTION FEESAs already noted herein before, the orders marking the matter settled and for costs to be taxed as prayed in the Application dated 18/08/2023 were granted on 25/09/2023. The terms of the settlement were however not highlighted to court. Further, upon perusal of the Plaint dated 24/03/2017 through which this suit was instituted on 27/03/2017, I note that the subject matter is defamation whereby the Plaintiff sought inter alia mandatory injunction, permanent injunction, general, aggravated, and exemplary damages orders against the Defendant. It is thus not possible to determine the value of the subject matter from either the final orders or the pleadings of this matter. The foregoing is the reason I have referred to Paragraph 1 under “Others” of the applicable scale in determining the chargeable instruction fees, which stipulates;Other MattersTo sue or defend in any case not provided for above; such sum as may be reasonable but not less than—(i)If undefended 45,000(ii)If defended 75,000In exercising my discretion granted under the above provision, I am guided by the holding in the case of Joreth Limited –Vs- Kigano & Another [2002] E.A.92 where the court set out various factors that are to be considered in determining the instruction fee namely; the importance of the matter, general conduct of the case, time taken for its dispatch and the impact of the case on the parties. The Court of Appeal held:the value of the subject matter for the purposes of taxation of a bill of costs ought to be determined from the pleadings, judgement or settlement (if such be the case) but if the same is not so ascertainable the Taxing Officer is entitled to use his discretion to assess such instruction fee as he considers just, taking into account, amongst other matters, the nature and the importance of the cause or matter, the interest of the parties, the general conduct of the proceedings, any direction by the trial judge and all other relevant circumstances. It is not really in the province of a Judge to re-tax the bill. If the Judge comes to the conclusion that the taxing officer has erred in principle he should refer the bill back for taxation by the same or another taxing officer with appropriate directions on how it should be done. The Judge ought not to interfere with the assessment of costs by the Taxing Officer unless the officer has misdirected himself on a matter of principle. In principle the instruction fees is an independent and static item, is charged once only and is not affected or determined by the stage the suit has reached. The Taxing Officer whilst taxing his bill of costs is carrying out his functions as such only. He is an officer of the Superior court appointed to tax bills of costs.”As already noted, the subject matter involves a defamation claim. The court proceedings show the general conduct of the matter which was instituted in 2017 and having been marked as settled on 25/09/2023 having been certified ready for hearing on 15/11/2018 but marked settled before being heard. In between there are several mentions of compliance and a Notice to Show Cause determined vide the ruling delivered on 03/05/2023. Considering the foregoing, I find that the amount tabulated as instruction fees is inordinately high in the circumstances. Taking the factors stated in the referred case, I find that the instruction fee of Kshs 100,000 is reasonable. I proceed to tax Item 1 accordingly. The amount taxed off is Kshs 2,900,000.Further, I note that Plaintiff has proceeded to raise the instruction fees by half under item 2 on grounds of the matter having been conducted by senior counsel. A look at Proviso (iii) of Paragraph 1 of the applicable scale reveals that is states as follows:(iii)In any case which a certificate for senior counsel has been given by the judge, the instruction fee allowed on taxation as between party and party shall be increased by one-half and other charges shall be doubled where requisite, the allowance for attendances of senior counsel in court conducting or leading the cause being on the higher scale.I have perused the court proceedings and noted that there is no certificate for senior counsel given by the judge. I thus have no basis to apply the above provision. Item 2 is thus taxed off.GETTING UP FEESThe applicable scale makes provision for fees for getting up or preparing for trial under Part A Paragraph 2 which stipulates;In any case in which a denial of liability is filed or in which issues for trial are joined by the pleadings, a fee for getting up and preparing the case for trial shall be allowed in addition to the instruction fee and shall be not less than one-third of the instruction fee allowed on taxation:Provided that—i. this fee may be increased as the taxation officer considers reasonable but it does not include any work comprised in the instruction fee;ii. no fee under this paragraph is chargeable until the case has been confirmed for hearing, but an additional sum of not more than 15% of the instruction fee allowed on taxation may, if the judge so directs, be allowed against the party seeking the adjournment in respect of each occasion upon which a confirmed hearing is adjourned;iii. in every case which is not heard the taxing officer must be satisfied that the case has been prepared for trial under this paragraphUpon considering the court record, I am satisfied that the case had been prepared for trial as noted in the proceedings of 15/11/2018 when this matter was certified ready for hearing and the court ordered a hearing date be fixed at the registry. The Plaintiff is thus entitled to costs for getting up though the matter was not heard to a conclusion. Thus, the taxation fee for getting up under item 1 is one-third of the instruction fees which equals Kshs 33,333.33. item 3 is hence taxed accordingly.PERUSALItem 28, 64, 66, 75, 76, 79, 107, and 110 on perusal of various documents have been drawn to scale and thus taxed accordingly. I am guided by Paragraph 8 of the applicable scale and that the subject documents contain 2 folios, 2 folios, 1 folio, 1 folio, 1 folio, and 1 folio respectively.CORRESPONDENCEItem 29, 41, 47, 54, 65, 72, 74, 103, and 106 on drawing various correspondences have been drawn to scale and thus taxed as drawn. I have referred to Paragraph 6 of the applicable scale in my determination.Concerning item 34, there is no letter to the Deputy Registrar of 06/09/2017 on record. There being no evidence of the existence of such a letter I have no basis for allowing costs for its drawing. Thus item 34 is taxed off.ATTENDANCESItem 109 on court attendance has been drawn to scale and thus taxed as drawn. I have referred to Paragraph 7(a) of the applicable scale since the parties appeared before the Deputy Registrar on the subject date (04/07/2023).For items 32, 37, 46, 50, 70, and 89, there is no record of proceedings being held on the date stated under the said items. An advocate cannot be awarded costs for non-existent court attendance. Thus, the amounts under the said items are taxed off.As for item 73, though there were court proceedings on 04/05/2020, the court record shows that the Plaintiff had no advocate on its behalf on the said date. item 73 is thus taxed off.DRAWINGIn respect to item 38 on the drawing mention notice for purported court attendance of 06/11/2017, I note that neither did Plaintiff avail such a mention notice to the taxing master nor is it in the court record. I also note that there were no court proceedings on 06/11/2027. There is thus no basis for the taxing master to allow costs tabulated under item 38. The same is thus taxed off.SERVICEItem 40 is for service of Mention Notice dated 09/10/27 which is not in the court record. Under Items 42 and 49 the Plaintiff has tabulated costs for service of the letter dated 15/03/2018 and service of letter dated 27/06/2018 respectively but has not indicated the service was upon who making it difficult for the taxing master to determine the service fees. In the circumstances, I proceed to tax off the amounts under items 40, 42, and 49.COPIESItem 48 on making copies of letter dated 27/06/2018 which contains 2 folios, I find that the same is drawn to scale and thus taxed as drawn. I have referred to Paragraph 5 of the applicable scale in my determination.Concerning item 39, it has already been established herein before under attendance and drawing that there is no such mention notice on record. The Plaintiff thus cannot be awarded costs for making copies of a document whose existence is in question. Hence item 39 is taxed off.VATOn page 8 of the subject bill, the Plaintiff has tabulated VAT costs of Kshs 1,101,824. The said item is unnumbered.The subject bill is a Party and Party Bill of Costs.Section 6 (1) of the VAT Act 2015 provides that tax shall be charged on any supply of goods or services made or provided in Kenya where it is a taxable supply made by a taxable person in the course of or in furtherance of any business carried on by him. Section 2 of the Act defines “supply” to include the sale or provision of taxable services to another person and “a taxable service” as that which has not been specified in the Third Schedule. Legal services are not listed among exempt supplies in the Third Schedule of the Act.For Party and Party Bill of Costs, the winning party is merely compensated for the costs they incurred in prosecuting or defending a case while for Advocate-Client Bill of Costs, an advocate is compensated for the services rendered to the client. The Court in the case of Pyramid Motors Limited v Langata Gardens Limited [2015] eKLR distinguished the two as follows-
30.On the final issue of VAT, I hold the simple view that in allowing the same the Master erred under the Value Added Tax Act, 2013 particularly section 5 thereof. Value Added Tax (VAT) is chargeable in taxable supply made by any registered person. There was no taxable supply of either goods or services made to the Applicant herein by the Respondent herein. The Bills herein concerned Party and Party costs and VAT could then not apply as neither party fetched nor supplied services to the other. True, legal services were rendered but it is not the Advocate who was being compensated herein. The Master could only have awarded VAT if the Bills were Advocate-Client Bills or if there was tendered evidence before the Master that the Plaintiff had paid VAT and was consequently entitled to indemnity. But yet that again is also debatable whether the Plaintiff was a vatable person. I would vacate the award on VAT as the Master erred.”
Similarly, the Plaintiff did not provide any evidence indicating that he had paid VAT on the legal fees they had paid to their advocates hence are not entitled to an indemnity. I thus do not award any amount for VAT.DISBURSEMENTSThere are receipts on record to support the Plaintiff's claim of incurring the filing fees tabulated under items 125 to 128, 130, 131, and 133 to 137. The said items are thus taxed as drawn. There was however no letter to the Deputy Registrar filed on 07/06/2018 in this matter as alleged under item 132. There are also no charges for filing an Affidavit of Service as tabulated under item 145. There being no basis for allowing the costs under items 132 and 145, I proceed to tax the same off. I also note that at this stage there is no document on record called Certificate of Taxation. I thus opine that the costs under item 146 are speculative in nature. I thus tax off item 146.CONCLUSIONThe upshot therefore is that the amount taxed off the Plaintiff’s Party and Party Bill of Costs dated 06/10/2023 is Kshs 7,747,570.67.In conclusion, the subject bill is taxed at Kshs 252,013.33. R/A 14 days.It is so ordered.DATED and DELIVERED at NAIROBI this 7TH day of FEBRUARY, 2025………………………………….S.K. MOTARIDEPUTY REGISTRARIn the presence of:Mr Kamau for Plaintiff/ApplicantMs Ikubi for Defendant/Respondent| MILIMANI CIVIL HCCC NO. 70 OF 2017 | 0 |