' ''
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA AT NAIROBI COMMERCIAL AND TAX DIVISION
MISCELLANEOUS APPLICATION NO. E762 OF 2021 VIRENDRA RAMJI GUDKA APPLICANT
VERSUS
VIOLET MARANGA t/a legal representative of the firm of RAMESH SHARMA ADVOCATE 1STRESPONDENT
ESTATE OF RAMESH SHARMA 2NDRESPONDENT
JUDGEMENT ON REFERENCE
INTRODUCTION AND BRIEF FACTS
1. Ramesh Sharma (Deceased Advocate) entered into a fee agreement with the Applicant for legal fees amounting to Kshs. 64,952,355/= for representing him in Civil Suit No. 480 of 2011 and Judicial Review Application No. 145 of 2016, wherein the Applicant was awarded Ksh. 433,015,700 by the Honourable Court.
2. Approximately one year after the demise of the deceased and three years after the fees Agreement was entered into and settlement made in full, the Applicant approached this Honourable Court through an Application dated 14th October 2021, wherein their second prayer sought that “The exorbitant Legal Fees billed by the 1st Respondent as against the Applicant with regards to Civil Suit No.480 of 2011 and Judicial Review Application No.145 of 2016 be hereby rendered illegal unenforceable and a nullity in Law.
3. The Suit was litigated to its just conclusion. On 16th May 2023, the Court delivered its Ruling upholding the said Agreement and dismissed the Applicant''''s Application dated 14th October 2021 with costs to the Respondent. The facts and evidence are set out in pleadings on the Court record.
4. The Respondent filed its Bill of Costs dated 31st July 2023, which Hon Claire Adisa initially taxed on 30th November 2023. Upon an Application by the Applicant on the ground that they never participated in the Taxation, the Hon. Judge ordered that the Bill be taxed afresh. Hon. Maureen Shimenga retaxed the Bill on 10th March 2025.
5. Aggrieved by the decision of the taxing master and more particularly, with the instruction fees, the Applicant filed the instant Reference because the Honourable Registrar in taxing Item 1 of the Bill of Costs did not apply the Principles of Taxation. The Respondent prays.
a. THAT this Honourable Court be pleased to review and or set aside the decision of the Taxing Master Hon. Maureen Shimenga issued in the Ruling of 10th March 2025 in respect to Item 1 of the Bill of Costs dated 31st July 2023.
b. THAT in the alternative and without prejudice to the foregoing, this Honourable Court be pleased to remit the Bill of Costs dated 31st July 2023 to another Taxing Master for re-taxation or make directions for fresh Taxation.
6. THE COURT DIRECTED THE APPLICATION BE CANVASSED VIA SUBMISSIONS
RESPODENT’S SUBMISSIONS
(in support of the application dated 14th March 2025)
7. The Respondent, in support of the application, submitted on one issue.
8. Whether the Taxing Master Applied the Principles of Taxation while Taxing Item 1 of the Bill of Costs Dated 31st July 2023?
9. It is a trite Law that where the value of the subject matter cannot be ascertained, a taxing officer is required to exercise his discretion based on relevant considerations to determine instruction fees.
10. The instant suit is one where the value of the subject matter is clearly ascertainable through the pleadings. We thus submit that costs must reflect the actual value of the matter litigated, and the taxing master''''s discretion should only be invoked when the subject matter is genuinely unclear.
11. It is the submission of the Respondent that Instruction fees are calculated on the value of the subject matter as per Schedule 6 (1) of the Advocate Remuneration Order 2014 which stipulates that: -
“… where the value of the subject matter can be determined from the pleadings, judgments, or settlement between the parties.
12. This was elaborated in Joreth Ltd v Kigano & Associates NRB CA Civil Appeal No. 66 of 1999 [2002] eKLR, where the Court of Appeal outlined the principle as follows:
“the subject matter of a suit for 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 the matter, the interest of the parties, general conduct of the proceedings, any discretion by
the trial judge and all other relevant circumstances”
13. Further, the Court of Appeal in Peter Muthoka & another v Ochieng & 3 others (2019) Eklr expounded on the principles in Joreth Ltd v Kigano & Associates and set down the proper basis of taxing the instruction fees as follows.
“It seems to us quite plain that the basis for determining subject matter value for purposes of instruction fees is wholly dependent on the stage at which the fees are being taxed. Where it happens before Judgement, it is the pleadings that form the basis for determining subject value. Once Judgement has been entered and for what seems to us to be an obvious reason, recourse will not be had to the pleadings since
the Judgement does not determine conclusively the value of the subject matter as a claim, no matter how pleaded, gets its true value as adjudged by the court".
14. The Respondent submits that the subject matter in this case can be readily ascertained, not only from the pleadings but also from the Ruling delivered on 16th May 2023, specifically in Paragraphs 14 and 15 thereof. The Law is therefore clear that instruction fees are to be assessed upon the face of the primary pleadings, settlement reached, or final Judgement.
15. In this instant matter, the Ruling on 16th May 2023 by the Honourable Judge upheld the Agreement of fees for the sum of Kshs: 64,952,355/= /=, thus the instruction fees ought to be charged based on this value adjudged by the Court.
16. The Advocates of the Applicant aver that the Subject matter cannot be based on an amount that was in dispute, while this Honourable Court upheld the said amount in its Ruling delivered on 16th May 2023. We therefore submit that the cardinal principle of Law is that Courts do not make contracts for parties.
17. The Applicant freely signed the Contract, and he should not be allowed to approbate and reprobate where the Court found it just to hold the Applicant to the terms of the Contract that he duly signed.
18. The Taxing Master, therefore, failed to apply the established principles of Taxation in taxing Item 1 of the Respondent''''s Bill of Costs. The Taxing Master cannot simply claim to have exercised her discretion in taxing Item 1 based on the direction of the Applicant. As a Taxing Master, she is obligated to be guided by the principles of Taxation, rather than by the Applicant’s assertions.
19. This matter has been taxed twice with different amounts awarded by two different Registrars. This Court is equipped with inherent powers by dint of Article 165 of the Constitution of Kenya, to determine matters such as these with finality.
20. Justice Ringera (RTD) in First American Bank of Kenya Limited v Gulab P. Shah & 2 Others (2002) EKLR observed as follows: -
"I have asked myself whether I should remit the Bill back to the taxing officer with directions that she should determine the instruction fees and then consider not increasing it, as there are no factors to warrant an increase. I am convinced in my mind that it would be a waste of judicial time in the circumstances of this case. It would also saddle the parties with unnecessary costs."
21. As observed by the learned Judge above, it is therefore our humble submission that what is prudent in bringing this matter to a conclusion is for the Court to determine the issue of the value of the subject matter to finality.
22. In so determining, we humbly implore that if the Court finds that the Subject matter was ascertainable as argued by the Respondent, it proceeds to tax the Bill afresh in line with the Advocates Remuneration Order 2014 and determine the Instruction fees payable to the Respondent.
23. APPLICANT’S SUBMISSIONS
(In Support of The Replying Affidavit to Oppose the Respondent’s Reference Dated 14th March 2025).
24. The Applicant in submissions, based on the argument of one issue, namely.
I. Whether the Respondent has discharged its burden of proof in demonstrating an error of principle or misapplication of the Law to warrant interference with the Taxing Master''''s decision?
II. Costs.
25. The procedure for challenging a Taxing Master’s decision is governed by Rule 11 of the ARO, which provides:
"(1) Should any party object to the decision of the taxing officer, he may, within fourteen days after the decision, give notice in writing to the taxing officer of the items of Taxation to which he objects.
(2) The taxing officer shall forthwith record and forward to the objector the reasons for his decision on those items, and the objector may, within fourteen days from the receipt of the reasons, apply to a judge by chamber summons, setting out the grounds of his objection."
26. Further to this, the High Court’s jurisdiction to interfere with a Taxing Master’s decision is limited. In First American Bank of Kenya Ltd v Gulab P. Shah & 2 others [2002] KEHC 1277 (KLR), Ringera J. (as he then was) held:
“This court cannot interfere with the taxing officer’s decision on taxation unless it is shown that either the decision was based on an error of principle, or the fee awarded was so manifestly excessive as to justify an inference that it was based on an error of principle.”
27. In support of the foregoing, the case of Kipkorir, Tito & Kiara Advocates v Deposit Protection Fund Board [2005] eKLR also echoed this position, where the Court of Appeal stated: -
"The learned Judge, like the taxing officer, was exercising judicial discretion when he allowed the Reference. This Court cannot interfere with the exercise of that discretion unless it is shown that the learned Judge acted on the wrong principles of Law."
28. Similarly, in Republic v Minister for Agriculture & 2 others Ex parte Samuel Muchiri W’Njuguna & 6 others [2006] KEHC 3504 (KLR), Judge J. B. Ojwang (as he was then) set out the basic principle of Taxation in Premchand Raichand Ltd & Another v. Quarry Services of East Africa Ltd & Another [1972] EA 162 in the words of Spry, V-P. (at p.164) as follows:
“The Taxation of costs is not a mathematical exercise; it is entirely a matter of opinion based on experience. A court will not, therefore, interfere with the award of a taxing officer, and particularly where he is an officer of great experience, merely because it thinks the award somewhat too high or too low."
29. The principles guiding Taxation were articulated in detail in the case of Premchand Raichand Ltd v Quarry Services of East Africa Ltd above, as follows:
a. Costs should not rise to a level that confines access to justice to the wealthy.
b. A successful litigant should be fairly reimbursed for costs incurred.
c. The general level of remuneration must attract recruits to the profession.
d. There should be consistency in the awards made.
30. The Applicant submits that the Taxing Master adhered to these principles, and the Respondent has failed to demonstrate any error of principle or manifest injustice to justify interference.
31. d. The taxing master’s decision was sound and procedurally valid.
32. The Taxing Master’s decision of 10th March 2025, taxing Item 1 at Kshs. 500,000/-was based on a proper application of the ARO and the principles of Taxation enumerated in part C herein.
33. The Respondent’s claim for instruction fees was premised on an erroneous basis, namely, a purported “contract” pegging fees at 10% of the decretal amount and a further 50% of the acquired legal fees of Kshs. 21, 650, 785/. However, the Applicant submits that the subject matter of the application dated 14th October 2021 was not the decretal amount from prior suits but a challenge to the legality of the Respondent’s fees.
34. As such, the value of the subject matter could not be based on untaxed or speculative amounts from those suits. Reliance is made on the case of Eastland Hotel Limited v Wafula Simiyu & Co. Advocates NRB CA Civil Appeal No. 105 of 2014 [2014] eKLR, the Court of Appeal reiterated that:
“This Court’s decision in Joreth Ltd v Kigano & Associates [2002] 1 EA 92, which was cited to us by both the appellant and the Respondent, states that the value of the subject matter for purposes of Taxation of a bill of costs ought to be determined from the pleadings, judgment, or settlement. Where the value is unascertainable, the Taxing Master has discretion to assess reasonable fees based on the work done and complexity of the matter."
35. The Taxing Master thus correctly found that the application did not involve complex legal issues or voluminous documentation. The matter was disposed of by way of a ruling on 16th May 2023, following written submissions.
36. The taxed amount was reasonable and consistent with Schedule 6(j) of the ARO, subject to the Taxing Master’s discretion to increase or decrease based on complexity and work done.
37. The Respondent has not demonstrated that the Taxing Master overlooked any vital factors or applied irrelevant considerations in exercising her discretion.
38. The Applicant further submits that the Respondent''''s reliance on the first Taxation by Hon. Claire Adisa (Kshs. 1,819,285/-) is misplaced.
39. Hon. Lady Justice Rhoda Rutto set aside that Taxation due to procedural irregularities, specifically the Applicant''''s non-participation, which violated natural justice.
40. The second Taxation by Hon. Maureen Shimenga was conducted afresh, with both parties participating, and was procedurally sound.
41. E. The Respondent has failed to demonstrate an error of principle
42. The Respondent’s Reference is premised on vague and unsubstantiated claims that the Taxing Master failed to apply taxation principles.
43. In Peter Muthoka & another v Ochieng & 3 others [2019] KECA 597 (KLR), the Court of Appeal held that:
"When it is shown that there was a misdirection on some matter resulting in a wrong decision, or it is manifest from the case as a whole that the discretion was improperly exercised, resulting in misjustice, to borrow the holding in MBOGO -vs- SHAH, then the decision, though discretionary, may properly be interfered with."
44. However, we humbly submit to this Honourable Court that the Respondent has not identified any specific misdirection or irrelevant factors considered by the Taxing Master. Further, in Vipul Premchand Haria v Kilonzo &
Co Advocates [2020] KECA 591 (KLR), the Court emphasized that instruction fees must reflect the work done in the specific matter and must have a discernible basis. As such, the Respondent’s contention that the instruction fees should reflect the decretal amount from prior suits is speculative and ignores the fact that those costs were not taxed or determined by a competent court.
45. The Taxing Master’s reduction of the fees to Kshs. 500,000/- was a proper exercise of discretion, ensuring that the costs were proportionate to the work done and did not confine access to justice to the wealthy. Furthermore, the Respondent''''s alternative prayer for remittal to another Taxing Master or fresh Taxation lacks merit.
46. In Royal Media Services V Telkom Kenya Ltd &
13 others [2010] KEHC 4087 (KLR), the Court relied on the case of Steel Construction Petroleum Engineering (EA) Limited v Uganda Sugar Factory [1972] EA 492, to emphasize that a bill should only be remitted for re-taxation if the error materially affected the assessment.
47. The Respondent has not shown any material error in the Taxing Master’s decision. The Applicant submits that repeated taxations would prejudice the Applicant by causing undue delay and expense, contrary to the principles of justice.
48. For the foregoing reasons, the Applicant prays that this Honourable Court dismiss the Respondent’s Reference dated 14th March 2025 with costs; uphold the Taxing Master’s decision of 10th March 2025 taxing Item 1 at Kshs. 500,000/-; and grant such further or other relief as this Honourable Court may deem.
49. ISSUES, ANALYSIS, AND DETERMINATION
50. The Respondent/Applicant in the application submits that the subject matter in this case can be readily ascertained, not only from the pleadings but also from the Ruling delivered on 16th May 2023, specifically in Paragraphs 14 and 15 thereof. The Law is therefore clear that instruction fees are to be assessed upon the face of the primary pleadings, settlement reached, or final Judgement.
51. In this instant matter, the Ruling on 16th May 2023 by the Honourable Judge upheld the Agreement of fees for the sum of Kshs: 64,952,355/= /=, thus the instruction fees ought to be charged based on this value adjudged by the Court.
52. The Advocates of the Applicant aver that the Subject matter cannot be based on an amount that was in dispute, while this Honourable Court upheld the said amount in its Ruling delivered on 16th May 2023. It is therefore submitted that the cardinal principle of Law is that Courts do not make contracts for parties.
53. The Applicant freely signed the Contract, and he should not be allowed to approbate and reprobate where the Court found it just to hold the Applicant to the terms of the Contract that he duly signed.
54. The Taxing Master, therefore, failed to apply the established principles of Taxation in taxing Item 1 of the Respondent''''s Bill of Costs. The Taxing Master cannot simply claim to have exercised her discretion in taxing Item 1 based on the direction of the Applicant. As a Taxing Master, she is obligated to be guided by the principles of Taxation, rather than by the Applicant''''s assertions.
55. This matter has been taxed twice with different amounts awarded by two different Registrars. Thus, it is submitted that this Court is equipped with inherent powers by dint of Article 165 of the Constitution of Kenya, to determine matters such as these with finality. Justice Ringera (RTD) in First American Bank of Kenya Limited v Gulab P. Shah & 2 Others (2002) EKLR observed as follows: - "I have asked myself whether I should remit the Bill back to the taxing officer with directions that she should determine the instruction fees and then consider not increasing it as there are no factors to warrant an increase. I am convinced in my mind that it would be a waste of judicial time in the circumstances of this case. It would also saddle the parties with unnecessary costs."
56. The Taxing Master’s decision of 10th March 2025, taxing Item 1 at Kshs. 500,000/-was based on a proper application of the ARO and the principles of Taxation enumerated in part C herein.
57. The Respondent’s claim for instruction fees was premised on an erroneous basis, namely, a purported “contract” pegging fees at 10% of the decretal amount and a further 50% of the acquired legal fees of Kshs. 21, 650, 785/. However, the Applicant submits that the subject matter of the application dated 14th October 2021 was not the decretal amount from prior suits but a challenge to the legality of the Respondent’s fees.
58. As such, the value of the subject matter could not be based on untaxed or speculative amounts from those suits. Reliance is made on the case of Eastland Hotel Limited v Wafula Simiyu & Co. Advocates NRB CA Civil Appeal No. 105 of 2014 [2014] eKLR.
59. The Taxing Master did not apply the Principles of Taxation in Taxing Item 1 of the Bill of Costs. The Law is clear that instruction fees are based on the value of the subject matter, and where the same is not ascertainable, the taxing officer is entitled to use his/her discretion to tax the same.
60. The Taxing Master thus correctly found that the application did not involve complex legal issues or voluminous documentation. The matter was disposed of by way of a ruling on 16th May 2023, following written submissions. The taxed amount was reasonable and consistent with Schedule 6(j) of the ARO, subject to the Taxing Master’s discretion to increase or decrease based on complexity and work done.
61. The Respondent has not demonstrated that the Taxing Master overlooked any vital factors or applied irrelevant considerations in exercising her discretion. The Applicant further submits that the Respondent''''s reliance on the first Taxation by Hon. Claire Adisa (Kshs. 1,819,285/-) is misplaced. Hon. Lady Justice Rhoda Rutto set aside that Taxation due to procedural irregularities, specifically the Applicant''''s non- participation, which violated natural justice. The second Taxation by Hon. Maureen Shimenga was conducted afresh, with both parties participating, and was procedurally sound.
62. To challenge a Taxing Master''''s decision in Kenya''''s High Court, you must file a Notice of Objection within 14 days of the decision, then apply to a judge within 14 days of receiving the Taxing Master''''s reasons for their decision by Chamber Summons. The application should specify the grounds for objection, and the Court will only interfere with the decision if there was a clear error of principle, the awarded fee was manifestly excessive, or the discretion was exercised capriciously.
63. The practice relating to Taxation of bills of costs, any complaint about any of the taxing officers, whether it relates to a point of Law taken about Taxation or to a grievance about the Taxation of any item in the Bill of costs, is ventilated by way of a reference to the Judge in accordance with paragraph 11 of the Advocates.
64. It is incumbent upon the party lodging reference to cogently prove on the balance of probabilities that in the decision impugned, there was a clear error of principle, the awarded fee was manifestly excessive, or the discretion was exercised capriciously.
65. Ramesh Sharma (Deceased Advocate) entered into a fee agreement with the Applicant for legal fees amounting to Kshs. 64,952,355/= for representing him in Civil Suit No. 480 of 2011 and Judicial Review Application No. 145 of 2016, wherein the Applicant was awarded Ksh. 433,015,700 by the Honourable Court.
66. Approximately one year after the demise of the deceased and three years after the fees Agreement was entered into and settlement made in full, the Applicant approached this Honourable Court through an Application dated 14th October 2021, wherein their second prayer sought that “The exorbitant Legal Fees billed by the 1st Respondent as against the Applicant with regards to Civil Suit No.480 of 2011 and Judicial Review Application No.145 of 2016 be hereby rendered illegal unenforceable and a nullity in Law.
67. The Suit was litigated to its just conclusion. On 16th May 2023, the Court delivered its Ruling upholding the said Agreement and dismissed the Applicant''''s Application dated 14th October 2021 with costs to the Respondent. The facts and evidence are set out in pleadings on the Court record.
68. It is discernible that the Respondent filed its Bill of Costs dated 31st July 2023, which Hon Claire Adisa initially taxed on 30th November 2023, and upon an Application by the Applicant on the ground that they never participated in the Taxation, the Hon. Judge ordered that the Bill be taxed afresh. Hon. Maureen Shimenga retaxed the Bill on 10th March 2025.
69. The Respondent’s claim for instruction fees was premised on the basis, namely, a purported “contract” pegging fees at 10% of the decretal amount and a further 50% of the acquired legal fees of Kshs. 21, 650, 785/. However, the subject matter of the
application dated 14th October 2021 was not the decretal amount from prior suits but a challenge to the legality of the Respondent’s fees.
70. In Joreth Ltd v Kigano & Associates [2002] 1 EA 92, which was cited to us by both the appellant and the Respondent, states that the value of the subject matter for purposes of Taxation of a bill of costs ought to be determined from the pleadings, judgment, or settlement. Where the value is unascertainable, the Taxing Master has discretion to assess reasonable fees based on the work done and complexity of the matter."
71. The Taxing Master thus correctly found that the application did not involve complex legal issues or voluminous documentation. The matter was disposed of by way of a ruling on 16th May 2023, following written submissions. The taxed amount was reasonable and consistent with Schedule 6(j) of the ARO, subject to the Taxing Master’s discretion to increase or decrease based on complexity and work done.
72. The Respondent has not demonstrated that the Taxing Master overlooked any vital factors or applied irrelevant considerations in exercising her discretion. The Respondent''''s reliance on the first Taxation by Hon. Claire Adisa (Kshs. 1,819,285/-) is misplaced. Hon. Lady Justice Rhoda Rutto set aside that Taxation due to procedural irregularities, specifically the Applicant''''s non-participation, which violated natural justice. The second Taxation by Hon. Maureen Shimenga was conducted afresh, with both parties participating, and was procedurally sound.
a. The principles guiding Taxation were articulated in detail in the case of Premchand Raichand Ltd v Quarry Services of East Africa Ltd above, as follows:
b. Costs should not rise to a level that confines access to justice to the wealthy.
c. A successful litigant should be fairly reimbursed for costs incurred.
d. The general level of remuneration must attract recruits to the profession.
e. There should be consistency in the awards made.
73. The Taxing Master adhered to these principles, and the Respondent has failed to demonstrate any error of principle or manifest injustice to justify interference.
74. . CONCLUSION
75. The Taxing Master’s decision was well-reasoned, procedurally sound, and consistent with the ARO and judicial precedents. The Respondent’s Reference is an attempt to re- litigate issues already determined without demonstrating an error of principle or manifest injustice. The Taxing Master''''s Ruling contains clear reasons; a Reference filed on speculative grounds is meritless. For the foregoing reasons, the Court makes the orders.
I. The Respondent’s Reference dated 14th March 2025 is dismissed with costs to the Respondent in this Reference assessed at ksh 20,000.
II. The Court upholds the Taxing Master’s decision of 10th March 2025, taxing Item 1 at Kshs. 500,000.
DATED AND DELIVERED VIA MICROSOFT TEAMS THIS 3RD OCTOBER 2025
CHARLES KARIUKI
JUDGE
'' '
REPUBLIC OF KENYA
IN THE HIGH COURT OF KENYA AT NAIROBI COMMERCIAL AND TAX DIVISION
MISCELLANEOUS APPLICATION NO. E762 OF 2021 VIRENDRA RAMJI GUDKA APPLICANT
VERSUS
VIOLET MARANGA t/a legal representative of the firm of RAMESH SHARMA ADVOCATE 1STRESPONDENT
ESTATE OF RAMESH SHARMA 2NDRESPONDENT
JUDGEMENT ON REFERENCE
INTRODUCTION AND BRIEF FACTS
1. Ramesh Sharma (Deceased Advocate) entered into a fee agreement with the Applicant for legal fees amounting to Kshs. 64,952,355/= for representing him in Civil Suit No. 480 of 2011 and Judicial Review Application No. 145 of 2016, wherein the Applicant was awarded Ksh. 433,015,700 by the Honourable Court.
2. Approximately one year after the demise of the deceased and three years after the fees Agreement was entered into and settlement made in full, the Applicant approached this Honourable Court through an Application dated 14th October 2021, wherein their second prayer sought that “The exorbitant Legal Fees billed by the 1st Respondent as against the Applicant with regards to Civil Suit No.480 of 2011 and Judicial Review Application No.145 of 2016 be hereby rendered illegal unenforceable and a nullity in Law.
3. The Suit was litigated to its just conclusion. On 16th May 2023, the Court delivered its Ruling upholding the said Agreement and dismissed the Applicant''''s Application dated 14th October 2021 with costs to the Respondent. The facts and evidence are set out in pleadings on the Court record.
4. The Respondent filed its Bill of Costs dated 31st July 2023, which Hon Claire Adisa initially taxed on 30th November 2023. Upon an Application by the Applicant on the ground that they never participated in the Taxation, the Hon. Judge ordered that the Bill be taxed afresh. Hon. Maureen Shimenga retaxed the Bill on 10th March 2025.
5. Aggrieved by the decision of the taxing master and more particularly, with the instruction fees, the Applicant filed the instant Reference because the Honourable Registrar in taxing Item 1 of the Bill of Costs did not apply the Principles of Taxation. The Respondent prays.
a. THAT this Honourable Court be pleased to review and or set aside the decision of the Taxing Master Hon. Maureen Shimenga issued in the Ruling of 10th March 2025 in respect to Item 1 of the Bill of Costs dated 31st July 2023.
b. THAT in the alternative and without prejudice to the foregoing, this Honourable Court be pleased to remit the Bill of Costs dated 31st July 2023 to another Taxing Master for re-taxation or make directions for fresh Taxation.
6. THE COURT DIRECTED THE APPLICATION BE CANVASSED VIA SUBMISSIONS
RESPODENT’S SUBMISSIONS
(in support of the application dated 14th March 2025)
7. The Respondent, in support of the application, submitted on one issue.
8. Whether the Taxing Master Applied the Principles of Taxation while Taxing Item 1 of the Bill of Costs Dated 31st July 2023?
9. It is a trite Law that where the value of the subject matter cannot be ascertained, a taxing officer is required to exercise his discretion based on relevant considerations to determine instruction fees.
10. The instant suit is one where the value of the subject matter is clearly ascertainable through the pleadings. We thus submit that costs must reflect the actual value of the matter litigated, and the taxing master''''s discretion should only be invoked when the subject matter is genuinely unclear.
11. It is the submission of the Respondent that Instruction fees are calculated on the value of the subject matter as per Schedule 6 (1) of the Advocate Remuneration Order 2014 which stipulates that: -
“… where the value of the subject matter can be determined from the pleadings, judgments, or settlement between the parties.
12. This was elaborated in Joreth Ltd v Kigano & Associates NRB CA Civil Appeal No. 66 of 1999 [2002] eKLR, where the Court of Appeal outlined the principle as follows:
“the subject matter of a suit for 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 the matter, the interest of the parties, general conduct of the proceedings, any discretion by
the trial judge and all other relevant circumstances”
13. Further, the Court of Appeal in Peter Muthoka & another v Ochieng & 3 others (2019) Eklr expounded on the principles in Joreth Ltd v Kigano & Associates and set down the proper basis of taxing the instruction fees as follows.
“It seems to us quite plain that the basis for determining subject matter value for purposes of instruction fees is wholly dependent on the stage at which the fees are being taxed. Where it happens before Judgement, it is the pleadings that form the basis for determining subject value. Once Judgement has been entered and for what seems to us to be an obvious reason, recourse will not be had to the pleadings since
the Judgement does not determine conclusively the value of the subject matter as a claim, no matter how pleaded, gets its true value as adjudged by the court".
14. The Respondent submits that the subject matter in this case can be readily ascertained, not only from the pleadings but also from the Ruling delivered on 16th May 2023, specifically in Paragraphs 14 and 15 thereof. The Law is therefore clear that instruction fees are to be assessed upon the face of the primary pleadings, settlement reached, or final Judgement.
15. In this instant matter, the Ruling on 16th May 2023 by the Honourable Judge upheld the Agreement of fees for the sum of Kshs: 64,952,355/= /=, thus the instruction fees ought to be charged based on this value adjudged by the Court.
16. The Advocates of the Applicant aver that the Subject matter cannot be based on an amount that was in dispute, while this Honourable Court upheld the said amount in its Ruling delivered on 16th May 2023. We therefore submit that the cardinal principle of Law is that Courts do not make contracts for parties.
17. The Applicant freely signed the Contract, and he should not be allowed to approbate and reprobate where the Court found it just to hold the Applicant to the terms of the Contract that he duly signed.
18. The Taxing Master, therefore, failed to apply the established principles of Taxation in taxing Item 1 of the Respondent''''s Bill of Costs. The Taxing Master cannot simply claim to have exercised her discretion in taxing Item 1 based on the direction of the Applicant. As a Taxing Master, she is obligated to be guided by the principles of Taxation, rather than by the Applicant’s assertions.
19. This matter has been taxed twice with different amounts awarded by two different Registrars. This Court is equipped with inherent powers by dint of Article 165 of the Constitution of Kenya, to determine matters such as these with finality.
20. Justice Ringera (RTD) in First American Bank of Kenya Limited v Gulab P. Shah & 2 Others (2002) EKLR observed as follows: -
"I have asked myself whether I should remit the Bill back to the taxing officer with directions that she should determine the instruction fees and then consider not increasing it, as there are no factors to warrant an increase. I am convinced in my mind that it would be a waste of judicial time in the circumstances of this case. It would also saddle the parties with unnecessary costs."
21. As observed by the learned Judge above, it is therefore our humble submission that what is prudent in bringing this matter to a conclusion is for the Court to determine the issue of the value of the subject matter to finality.
22. In so determining, we humbly implore that if the Court finds that the Subject matter was ascertainable as argued by the Respondent, it proceeds to tax the Bill afresh in line with the Advocates Remuneration Order 2014 and determine the Instruction fees payable to the Respondent.
23. APPLICANT’S SUBMISSIONS
(In Support of The Replying Affidavit to Oppose the Respondent’s Reference Dated 14th March 2025).
24. The Applicant in submissions, based on the argument of one issue, namely.
I. Whether the Respondent has discharged its burden of proof in demonstrating an error of principle or misapplication of the Law to warrant interference with the Taxing Master''''s decision?
II. Costs.
25. The procedure for challenging a Taxing Master’s decision is governed by Rule 11 of the ARO, which provides:
"(1) Should any party object to the decision of the taxing officer, he may, within fourteen days after the decision, give notice in writing to the taxing officer of the items of Taxation to which he objects.
(2) The taxing officer shall forthwith record and forward to the objector the reasons for his decision on those items, and the objector may, within fourteen days from the receipt of the reasons, apply to a judge by chamber summons, setting out the grounds of his objection."
26. Further to this, the High Court’s jurisdiction to interfere with a Taxing Master’s decision is limited. In First American Bank of Kenya Ltd v Gulab P. Shah & 2 others [2002] KEHC 1277 (KLR), Ringera J. (as he then was) held:
“This court cannot interfere with the taxing officer’s decision on taxation unless it is shown that either the decision was based on an error of principle, or the fee awarded was so manifestly excessive as to justify an inference that it was based on an error of principle.”
27. In support of the foregoing, the case of Kipkorir, Tito & Kiara Advocates v Deposit Protection Fund Board [2005] eKLR also echoed this position, where the Court of Appeal stated: -
"The learned Judge, like the taxing officer, was exercising judicial discretion when he allowed the Reference. This Court cannot interfere with the exercise of that discretion unless it is shown that the learned Judge acted on the wrong principles of Law."
28. Similarly, in Republic v Minister for Agriculture & 2 others Ex parte Samuel Muchiri W’Njuguna & 6 others [2006] KEHC 3504 (KLR), Judge J. B. Ojwang (as he was then) set out the basic principle of Taxation in Premchand Raichand Ltd & Another v. Quarry Services of East Africa Ltd & Another [1972] EA 162 in the words of Spry, V-P. (at p.164) as follows:
“The Taxation of costs is not a mathematical exercise; it is entirely a matter of opinion based on experience. A court will not, therefore, interfere with the award of a taxing officer, and particularly where he is an officer of great experience, merely because it thinks the award somewhat too high or too low."
29. The principles guiding Taxation were articulated in detail in the case of Premchand Raichand Ltd v Quarry Services of East Africa Ltd above, as follows:
a. Costs should not rise to a level that confines access to justice to the wealthy.
b. A successful litigant should be fairly reimbursed for costs incurred.
c. The general level of remuneration must attract recruits to the profession.
d. There should be consistency in the awards made.
30. The Applicant submits that the Taxing Master adhered to these principles, and the Respondent has failed to demonstrate any error of principle or manifest injustice to justify interference.
31. d. The taxing master’s decision was sound and procedurally valid.
32. The Taxing Master’s decision of 10th March 2025, taxing Item 1 at Kshs. 500,000/-was based on a proper application of the ARO and the principles of Taxation enumerated in part C herein.
33. The Respondent’s claim for instruction fees was premised on an erroneous basis, namely, a purported “contract” pegging fees at 10% of the decretal amount and a further 50% of the acquired legal fees of Kshs. 21, 650, 785/. However, the Applicant submits that the subject matter of the application dated 14th October 2021 was not the decretal amount from prior suits but a challenge to the legality of the Respondent’s fees.
34. As such, the value of the subject matter could not be based on untaxed or speculative amounts from those suits. Reliance is made on the case of Eastland Hotel Limited v Wafula Simiyu & Co. Advocates NRB CA Civil Appeal No. 105 of 2014 [2014] eKLR, the Court of Appeal reiterated that:
“This Court’s decision in Joreth Ltd v Kigano & Associates [2002] 1 EA 92, which was cited to us by both the appellant and the Respondent, states that the value of the subject matter for purposes of Taxation of a bill of costs ought to be determined from the pleadings, judgment, or settlement. Where the value is unascertainable, the Taxing Master has discretion to assess reasonable fees based on the work done and complexity of the matter."
35. The Taxing Master thus correctly found that the application did not involve complex legal issues or voluminous documentation. The matter was disposed of by way of a ruling on 16th May 2023, following written submissions.
36. The taxed amount was reasonable and consistent with Schedule 6(j) of the ARO, subject to the Taxing Master’s discretion to increase or decrease based on complexity and work done.
37. The Respondent has not demonstrated that the Taxing Master overlooked any vital factors or applied irrelevant considerations in exercising her discretion.
38. The Applicant further submits that the Respondent''''s reliance on the first Taxation by Hon. Claire Adisa (Kshs. 1,819,285/-) is misplaced.
39. Hon. Lady Justice Rhoda Rutto set aside that Taxation due to procedural irregularities, specifically the Applicant''''s non-participation, which violated natural justice.
40. The second Taxation by Hon. Maureen Shimenga was conducted afresh, with both parties participating, and was procedurally sound.
41. E. The Respondent has failed to demonstrate an error of principle
42. The Respondent’s Reference is premised on vague and unsubstantiated claims that the Taxing Master failed to apply taxation principles.
43. In Peter Muthoka & another v Ochieng & 3 others [2019] KECA 597 (KLR), the Court of Appeal held that:
"When it is shown that there was a misdirection on some matter resulting in a wrong decision, or it is manifest from the case as a whole that the discretion was improperly exercised, resulting in misjustice, to borrow the holding in MBOGO -vs- SHAH, then the decision, though discretionary, may properly be interfered with."
44. However, we humbly submit to this Honourable Court that the Respondent has not identified any specific misdirection or irrelevant factors considered by the Taxing Master. Further, in Vipul Premchand Haria v Kilonzo &
Co Advocates [2020] KECA 591 (KLR), the Court emphasized that instruction fees must reflect the work done in the specific matter and must have a discernible basis. As such, the Respondent’s contention that the instruction fees should reflect the decretal amount from prior suits is speculative and ignores the fact that those costs were not taxed or determined by a competent court.
45. The Taxing Master’s reduction of the fees to Kshs. 500,000/- was a proper exercise of discretion, ensuring that the costs were proportionate to the work done and did not confine access to justice to the wealthy. Furthermore, the Respondent''''s alternative prayer for remittal to another Taxing Master or fresh Taxation lacks merit.
46. In Royal Media Services V Telkom Kenya Ltd &
13 others [2010] KEHC 4087 (KLR), the Court relied on the case of Steel Construction Petroleum Engineering (EA) Limited v Uganda Sugar Factory [1972] EA 492, to emphasize that a bill should only be remitted for re-taxation if the error materially affected the assessment.
47. The Respondent has not shown any material error in the Taxing Master’s decision. The Applicant submits that repeated taxations would prejudice the Applicant by causing undue delay and expense, contrary to the principles of justice.
48. For the foregoing reasons, the Applicant prays that this Honourable Court dismiss the Respondent’s Reference dated 14th March 2025 with costs; uphold the Taxing Master’s decision of 10th March 2025 taxing Item 1 at Kshs. 500,000/-; and grant such further or other relief as this Honourable Court may deem.
49. ISSUES, ANALYSIS, AND DETERMINATION
50. The Respondent/Applicant in the application submits that the subject matter in this case can be readily ascertained, not only from the pleadings but also from the Ruling delivered on 16th May 2023, specifically in Paragraphs 14 and 15 thereof. The Law is therefore clear that instruction fees are to be assessed upon the face of the primary pleadings, settlement reached, or final Judgement.
51. In this instant matter, the Ruling on 16th May 2023 by the Honourable Judge upheld the Agreement of fees for the sum of Kshs: 64,952,355/= /=, thus the instruction fees ought to be charged based on this value adjudged by the Court.
52. The Advocates of the Applicant aver that the Subject matter cannot be based on an amount that was in dispute, while this Honourable Court upheld the said amount in its Ruling delivered on 16th May 2023. It is therefore submitted that the cardinal principle of Law is that Courts do not make contracts for parties.
53. The Applicant freely signed the Contract, and he should not be allowed to approbate and reprobate where the Court found it just to hold the Applicant to the terms of the Contract that he duly signed.
54. The Taxing Master, therefore, failed to apply the established principles of Taxation in taxing Item 1 of the Respondent''''s Bill of Costs. The Taxing Master cannot simply claim to have exercised her discretion in taxing Item 1 based on the direction of the Applicant. As a Taxing Master, she is obligated to be guided by the principles of Taxation, rather than by the Applicant''''s assertions.
55. This matter has been taxed twice with different amounts awarded by two different Registrars. Thus, it is submitted that this Court is equipped with inherent powers by dint of Article 165 of the Constitution of Kenya, to determine matters such as these with finality. Justice Ringera (RTD) in First American Bank of Kenya Limited v Gulab P. Shah & 2 Others (2002) EKLR observed as follows: - "I have asked myself whether I should remit the Bill back to the taxing officer with directions that she should determine the instruction fees and then consider not increasing it as there are no factors to warrant an increase. I am convinced in my mind that it would be a waste of judicial time in the circumstances of this case. It would also saddle the parties with unnecessary costs."
56. The Taxing Master’s decision of 10th March 2025, taxing Item 1 at Kshs. 500,000/-was based on a proper application of the ARO and the principles of Taxation enumerated in part C herein.
57. The Respondent’s claim for instruction fees was premised on an erroneous basis, namely, a purported “contract” pegging fees at 10% of the decretal amount and a further 50% of the acquired legal fees of Kshs. 21, 650, 785/. However, the Applicant submits that the subject matter of the application dated 14th October 2021 was not the decretal amount from prior suits but a challenge to the legality of the Respondent’s fees.
58. As such, the value of the subject matter could not be based on untaxed or speculative amounts from those suits. Reliance is made on the case of Eastland Hotel Limited v Wafula Simiyu & Co. Advocates NRB CA Civil Appeal No. 105 of 2014 [2014] eKLR.
59. The Taxing Master did not apply the Principles of Taxation in Taxing Item 1 of the Bill of Costs. The Law is clear that instruction fees are based on the value of the subject matter, and where the same is not ascertainable, the taxing officer is entitled to use his/her discretion to tax the same.
60. The Taxing Master thus correctly found that the application did not involve complex legal issues or voluminous documentation. The matter was disposed of by way of a ruling on 16th May 2023, following written submissions. The taxed amount was reasonable and consistent with Schedule 6(j) of the ARO, subject to the Taxing Master’s discretion to increase or decrease based on complexity and work done.
61. The Respondent has not demonstrated that the Taxing Master overlooked any vital factors or applied irrelevant considerations in exercising her discretion. The Applicant further submits that the Respondent''''s reliance on the first Taxation by Hon. Claire Adisa (Kshs. 1,819,285/-) is misplaced. Hon. Lady Justice Rhoda Rutto set aside that Taxation due to procedural irregularities, specifically the Applicant''''s non- participation, which violated natural justice. The second Taxation by Hon. Maureen Shimenga was conducted afresh, with both parties participating, and was procedurally sound.
62. To challenge a Taxing Master''''s decision in Kenya''''s High Court, you must file a Notice of Objection within 14 days of the decision, then apply to a judge within 14 days of receiving the Taxing Master''''s reasons for their decision by Chamber Summons. The application should specify the grounds for objection, and the Court will only interfere with the decision if there was a clear error of principle, the awarded fee was manifestly excessive, or the discretion was exercised capriciously.
63. The practice relating to Taxation of bills of costs, any complaint about any of the taxing officers, whether it relates to a point of Law taken about Taxation or to a grievance about the Taxation of any item in the Bill of costs, is ventilated by way of a reference to the Judge in accordance with paragraph 11 of the Advocates.
64. It is incumbent upon the party lodging reference to cogently prove on the balance of probabilities that in the decision impugned, there was a clear error of principle, the awarded fee was manifestly excessive, or the discretion was exercised capriciously.
65. Ramesh Sharma (Deceased Advocate) entered into a fee agreement with the Applicant for legal fees amounting to Kshs. 64,952,355/= for representing him in Civil Suit No. 480 of 2011 and Judicial Review Application No. 145 of 2016, wherein the Applicant was awarded Ksh. 433,015,700 by the Honourable Court.
66. Approximately one year after the demise of the deceased and three years after the fees Agreement was entered into and settlement made in full, the Applicant approached this Honourable Court through an Application dated 14th October 2021, wherein their second prayer sought that “The exorbitant Legal Fees billed by the 1st Respondent as against the Applicant with regards to Civil Suit No.480 of 2011 and Judicial Review Application No.145 of 2016 be hereby rendered illegal unenforceable and a nullity in Law.
67. The Suit was litigated to its just conclusion. On 16th May 2023, the Court delivered its Ruling upholding the said Agreement and dismissed the Applicant''''s Application dated 14th October 2021 with costs to the Respondent. The facts and evidence are set out in pleadings on the Court record.
68. It is discernible that the Respondent filed its Bill of Costs dated 31st July 2023, which Hon Claire Adisa initially taxed on 30th November 2023, and upon an Application by the Applicant on the ground that they never participated in the Taxation, the Hon. Judge ordered that the Bill be taxed afresh. Hon. Maureen Shimenga retaxed the Bill on 10th March 2025.
69. The Respondent’s claim for instruction fees was premised on the basis, namely, a purported “contract” pegging fees at 10% of the decretal amount and a further 50% of the acquired legal fees of Kshs. 21, 650, 785/. However, the subject matter of the
application dated 14th October 2021 was not the decretal amount from prior suits but a challenge to the legality of the Respondent’s fees.
70. In Joreth Ltd v Kigano & Associates [2002] 1 EA 92, which was cited to us by both the appellant and the Respondent, states that the value of the subject matter for purposes of Taxation of a bill of costs ought to be determined from the pleadings, judgment, or settlement. Where the value is unascertainable, the Taxing Master has discretion to assess reasonable fees based on the work done and complexity of the matter."
71. The Taxing Master thus correctly found that the application did not involve complex legal issues or voluminous documentation. The matter was disposed of by way of a ruling on 16th May 2023, following written submissions. The taxed amount was reasonable and consistent with Schedule 6(j) of the ARO, subject to the Taxing Master’s discretion to increase or decrease based on complexity and work done.
72. The Respondent has not demonstrated that the Taxing Master overlooked any vital factors or applied irrelevant considerations in exercising her discretion. The Respondent''''s reliance on the first Taxation by Hon. Claire Adisa (Kshs. 1,819,285/-) is misplaced. Hon. Lady Justice Rhoda Rutto set aside that Taxation due to procedural irregularities, specifically the Applicant''''s non-participation, which violated natural justice. The second Taxation by Hon. Maureen Shimenga was conducted afresh, with both parties participating, and was procedurally sound.
a. The principles guiding Taxation were articulated in detail in the case of Premchand Raichand Ltd v Quarry Services of East Africa Ltd above, as follows:
b. Costs should not rise to a level that confines access to justice to the wealthy.
c. A successful litigant should be fairly reimbursed for costs incurred.
d. The general level of remuneration must attract recruits to the profession.
e. There should be consistency in the awards made.
73. The Taxing Master adhered to these principles, and the Respondent has failed to demonstrate any error of principle or manifest injustice to justify interference.
74. . CONCLUSION
75. The Taxing Master’s decision was well-reasoned, procedurally sound, and consistent with the ARO and judicial precedents. The Respondent’s Reference is an attempt to re- litigate issues already determined without demonstrating an error of principle or manifest injustice. The Taxing Master''''s Ruling contains clear reasons; a Reference filed on speculative grounds is meritless. For the foregoing reasons, the Court makes the orders.
I. The Respondent’s Reference dated 14th March 2025 is dismissed with costs to the Respondent in this Reference assessed at ksh 20,000.
II. The Court upholds the Taxing Master’s decision of 10th March 2025, taxing Item 1 at Kshs. 500,000.
DATED AND DELIVERED VIA MICROSOFT TEAMS THIS 3RD OCTOBER 2025
CHARLES KARIUKI
JUDGE
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