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Court of AppealDismissedCivil Appeal No. 286 of 2010

Muriu, Mungai & Co. Avocates v New Kenya Co-operative Creameries Limited [2019] KECA 1011 (KLR)

Court of Appeal
8 February 2019
1,916 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~8 min to read original · ~4 min brief

The bottom line

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Kenya's Court of Appeal confirmed that a law firm's fees must follow their written agreement, rejecting the firm's attempt to charge more based on property valuations.

What this practically means

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Executive summary

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This was an appeal under Paragraph 11(3) of the Advocates (Remuneration) Order by Muriu, Mungai & Co. Advocates against a High Court ruling (Koome, J) which upheld the client's (New Kenya Co-operative Creameries Limited) objection to a taxing officer's decision and struck out the advocates' entire bill of costs relating to the transfer of assets, including property known as Nakuru Municipality/Block 11/38. The advocates argued that the objection was limited to three items of the bill, that the Judge erred in holding a single bill based on the value of the agreement should have been filed, and that the taxing officer rightly relied on a valuation report. The client maintained that the instructions were a block exercise, that fees had been agreed globally, and that the valuation report was confidential. The Court first upheld an objection to the client's supplementary record of appeal, expunging documents not part of the record below and admitted without leave. On the merits, the Court found the chamber summons and submissions attacked the entire bill, so the advocates' complaint on scope failed. It held the Judge was entitled to interfere on the basis of an error of principle, as the taxing officer failed to appreciate the block nature of the instructions, supported by the advocates' own letter accepting a global fee of Kshs. 11 million. Applying Premchand Raichand Ltd v Quarry Services of East Africa Ltd and Joreth Limited v Kigano & Associates, the Court found no basis to interfere, dismissed the appeal, and awarded costs to the respondent.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether the supplementary record of appeal containing additional evidence should be expunged
  2. 2.Whether the Judge erred in striking out the entire Bill of Costs when the notice of objection referred only to items 1, 2 and 3
  3. 3.Whether the taxing officer erred in principle by basing instruction fees on a valuation report rather than the fee agreement governing a block exercise of transfers

Key legal issues

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01

Scope of the objection to the taxing officer's decision

Holding

The objection extended to the entire Bill of Costs notwithstanding that the notice of objection mentioned only items 1, 2 and 3

Reasoning

The court reviewed the record and found that the chamber summons dated 9th April 2009 complained of the taxation of the entire bill and, in the alternative, items 1, 2 and 3. The grounds asserted the entire bill was legally untenable, and the submissions before the Judge attacked the whole bill. The complaint by the advocates therefore had no merit.

p. 2
02

Error of principle justifying interference with taxation

Holding

The taxing officer erred in principle by failing to appreciate that the instructions entailed a block exercise of transferring assets, so the Judge was entitled to set aside the taxation

Reasoning

The Judge's conclusion was supported by the material before her, including the advocates' own letter of 17th February 2005 accepting a global fee of Kshs. 11 million for the transfers of the properties. Reliance on a valuation report per property ignored the agreed block fee. Following Premchand Raichand and Joreth Limited, the court had no basis for interfering with the Judge's decision.

p. 2
03

Additional evidence on appeal

Holding

Documents in the supplementary record not part of the record below, admitted without leave, were expunged and not referred to

Reasoning

Counsel for the client conceded the bulk of the documents were not part of the record in the lower court and that leave was neither sought nor obtained to adduce additional evidence. The court upheld the objection and made no reference to the documents.

p. 2

Legal principles established

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  • An appellate court may interfere with a taxing officer's decision only where it is shown that the officer erred in principle in assessing costs
  • Where a notice of objection under Paragraph 11 is followed by a chamber summons attacking the entire bill and submissions to that effect were made, the objection is not limited to the items named in the notice

Court orders

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  1. 1.Upholding the objection to the supplementary record of appeal and making no reference to the documents therein
  2. 2.Dismissing the appeal with costs to the respondent

The bench

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One judgment of the whole court — no separate or dissenting opinions.

majority
majority
majority
On appeal from
High Court of Kenya at Nairobi (Commercial & Tax Division, Milimani)
Misc. Cause No. 699 of 2007
Jurisdiction invoked
Paragraph 11(3) of the Advocates (Remuneration) Order

Relief refused

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Admission of the documents in the supplementary record of appeal

They were not part of the record below and leave to adduce additional evidence was neither sought nor obtained

p. 2

The advocates' complaint that the objection was limited to three items

The chamber summons and submissions before the Judge attacked the entire Bill of Costs

p. 2

Costs

Appeal dismissed with costs to the respondent

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

This appeal is devoid of merit and is accordingly dismissed with costs to the respondent.
p. 3Disposition
we consider that the Judge was entitled to interfere with the decision of the taxing officer on the basis of an error of principle
p. 3Interference with taxation on error of principle
the submissions made before the Judge reflect that the client's objection to the decision of the taxing officer related to the entire Bill of Costs and not just to the three items.
p. 2Scope of objection
We accordingly uphold the objection and make no reference to the documents in question.
p. 2Additional evidence

Issues in the judgment

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minor

The judgment's opening paragraph states the High Court decision was rendered on 26th March 2010, while the cause title describes the ruling as dated 26th March 2019; the body repeatedly refers to 26th March 2010, which is consistent with a 2007 cause and a 2010 appeal number

minor

The judgment states the appeal is under Paragraph 11(3) of the Advocates (Remuneration) Order in the first paragraph, while the cause title and paragraph 1 reference a ruling dated 26th March 2019, which post-dates the delivery of this judgment on 8th February 2019

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Muriu, Mungai & Co. Avocates v New Kenya Co-operative Creameries Limited [2019] KECA 1011 (KLR)", Case Analysis (2019). Civil Appeal No. 286 of 2010. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2019/1011/eng@2019-02-08

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.