REPUBLIC OF UGANDA IN THE SUPREME COURT OF UGANDA AT MENGO (CORAM: TSEKOOKO, KAROKORA AND KATO, JJ.S.C) CIVIL APPLICATION NO. 22 OF 2002 BETWEEN C. C. C~DRAN AND KENGROW INDUSTRIES ~TD APP~ICANT RESPONDENT [Taxation reference from ruling of a single Justice (G. W. Kanyeihamba, J.S.C) dated 21st November, 2002 in Civil Application No. 17 of 2002.J RULING OF THE COURT: This is a reference a single Justice a taxing awarded officer. to us from the ruling of Kanyeihamba, The learned Justice reduced the J.S.C as as amount of this Court on a reference from the Registrar by the taxing officer. We give a brief background. which the present respondent presented Registrar, 16,000,000 applicant There was an appeal in this Court in was the respondent to the Registrar awarded while the present The former Court. The shs. was the appellant a bill of costs as taxing who lost the appeal. of this the officer, fees. applicant as instruction The respondent was unhappy with the award. He referred the matter 1 to the single Justice. The single Justice shs. 5,000,000./=. referred the matter reduced to us. the award from shs. The reference 16,000,000/= under to The applicant was dissatisfied. is made He has now Rules is 105(7), 41(1) and 1(3) of the Rules of this Court. by way of motion. reverse the decision following grounds In the motion, the applicant of the single Justice. The reference asks the Court to The motion sets out the - in support of the reference: aJ. The instruction was awarded fee by of shs. the 5,000,000 Justice which was learned manifestly inadequate and an error in law. b). The learned Justice of the Supreme in holding was that Court erred the subject of shillings both in law andfact matter slightly of the appeal a sum above 30,000,000. c). The learned and/or thereby Justice of the Supreme wrong the award. Court principles erred in fees, exercised/applied assessing making an erroneous determining/ instruction d}. The learned at law and erroneous reduce the Justice of the Supreme he based taxing in other Court made erred an tel misguided when himse if, and award award his decision master decided of the (sic) on cases the dimentional reduction 2 cited made by him, other than the awards themselves therein and the principles relied on. Mr. Muziransa, counsel for the applicant, made 2002 are an afflTIl1ation dated of 27th November, contents of the in support of this reference. The similar to the grounds set Ol\t in affIrmation the motion and reproduced above. Before us, Mr. Muziransa, as grounds (b),(c) and (d) counsel for the applicant, fIrstargued together before he argued ground (a): In respect of the three grounds submitted [(b) (c) and (d)],Mr. Muziransa to the that the learned Justice did not direct his mind taxation of costs in this Court (3) of rule 9 of the Third Schedule principles governing Paragraphs (2) and and especially to the Rules .\ of the Court. He referredto a number Court including: A.A. Kassam and of cases decided by this 2 others vs. Habre International CivilApplication 16/99 (unreported). Counsel he held that the contended that the singleJustice erred when subject matter was shs. 30,000,000/= which, according to shs. 64,945,000/=. Therefore, learned counsel, should be contended counsel, the award of shs.5m/= Dr. Byamugisha, was too low. the decision of for the respondent, supported the single Justice contending, and here we agree with him, that Mr. Muziransa was mistaken in regard to the subject matter of the appeal because Mr. M uziransa considered the award to be the amount appearing in the decree of the Court of Appeal as the decreed by this Court subject matter rather that the amount which was relevant for purposes of the taxation of costs in this .., .) Court. Dr. Byamugisha submitted that each case must be decided on its own facts. He referred us to GeneralParts (U) Ltd Vs Non -Performing Assets Recovery Trust - Civil Application should be t,~ken to a referred 21/2000 (unreported) for the view that inflation costs. Learned into account number taxation reduced asked Although neater in awarding counsel the of other the awards us to give decisions made guidance on grounds each. illustrating by taxing on trend Leamed regarding counsel fee. It is of costs in this Court. In each of these cases the Court officers. taxation of instruction arguments (b), (c) and (d) were general. We begin with ground (b). for us to consider The passage which in the ruling from which this reference criticised the learned Justice arose and for appear~s at Mr. Muziransa pages 8 and 9 and states: " The record appeal awarded according to the 13,000,000. amounting slightly includes damages claim when was shows allowed a that in sum when this of US$ the Court, respondent's the Court which 1800 shs. sums of him 12,600 rate at shs. same other to the then applicable dollar is He was to shs. over shs. an award for breach also approximately awarded making 7,240,000 30,000,000. of shs. a total The sum awarded 5,000,000 as general the of contract. hoped appeal Consequently the respondent he filed the to get from was in the this Court range of about shs. 25,000,000. In the respondent's bill of 4 costs bill dated 17th June, of shs. fee 61,582,000 of shs. 2002, Counsel which drew up a a17j. included instruction where 50,000,000. has been a the In my view, claiming sum sum of of shs. shs. shs. a successful and to be party is 25,000,000 30,000,000/= and ask awarded to claim the sum of shs 61,582,000 awarded 50,000,000 is outrageous. of counsel which value costs and instructions fee respectively I find who it hard to understand minds bvlc\lj can bod~J/ present bills of costs the same matter as or greater than th(~' of the litigation." /',,- .. are about of the subject Obviously Justice in the last part expressed himself of the above very strongly passage, the learned his Whilst we to demonstrate disapproval exaggerated facts. factors of the claim for instruction bills of costs must fee in the case. be discouraged by Courts, may say, in passing, that each case must be decided to fmd a case where on its own the taxed Ivlany For it is not impossible would influence may include costs in a case exceed the value of the subject the calculation matter. of costs to be awarded. occasioned by many Such factors adjournments. cost of transport With learned respect Justice to Mr. Muziransa, misdirected himself we can not agree that the was on the law especially The learned Justice rule 9 of the 3rd Schedule and on the facts. alive to the facts of the case. We have just reproduced 5 a pas~age from his ruling showing how the Justice " I note that neither officer actual showed Counsel which million boldly shs. computed the figure of taxing the of the is a thE! The shs 30 million. At page 9 of his ruling the Justice stated: nor the learned in computing was finally shillings. in his ruling 40,000,000. seems keen figured Sixty stated around interest sum in shillings was officer was awarded. It that Mr. Muziransa litigation mystery taxing matter Endroma, that the subject matter he got the sum from. as to where Mis Enid not to by awarded Counsel for the applicant, about the sum of money have bothered this Court in Civil Appeal No.7 of 2001." This certainly mind to the demonstrates facts of the that the learned case. that In his Justice address directed to us his Mr. Muziransa Justice, has not shown the Justice quoted in the facts mentioned figures. Mter by the wrong the Ju'~tice noted the deficiencies counsel shs. 50,000,000 in submissions and before the taxing officer of that the amount of shs. 16,000,000 The Court taxing of for both sides, the Justice claimed concluded the amount awarded Justice relating by the taxing then referred taxation officer was manifestly to the recent decisions and excessive. by this why to the of costs wondered Of course, Justice Counsel officers do not refer to such decisions. Muziransa relying contended cases, that the learned before us Mr. was argued wron~ in on those instead of relying on the cases cited by that the Mr. Muziransa, to decide the reference. 6 Justice was wrong to assume that these to us. the same subject cases matter was shs.30,000,000 the Justice / = Incidentally have been cited relied on by They include: Bank of 23 if 1999 Uganda Vs Banco Arabe Espanal (unreported), Manufacturers,Civil Application (U) Ltd Vs Non Application We note considered amount - Civil Application Attorney General Vs Uganda Blankets 17 of 1993 and General Parts Performing Assets Recovery Trust, Civil 21 of 2000. from his ruling that in fact the learned Judge that the these and other cases as instruction before he concluded awarded fees of shs. 16m/ = was excessive and therefore he reduced it to shs. 5m/=. We have not been persuaded misdirected concluded himself either by Mr. Muziransa on the matter facts that the Justice he or in law when that the subject the decree Uganda of the appeal was shs. 30M/=. really reflects, though in That is what dollars and of this court shillings. The rIDding was based on the to upset facts of the case. because That is a rIDding, which we are unable out to us. no error has been pointed We now have to answer rule 9(2) and provisions the question: Did the Justice misapply These ,. (3) as contended by Mr. Muziransa? read as follows: to be allowed an appeal "9(2) The fee appeal the for shall instructions be a sum to that or oppose taxing officer amount considers involved reasonable, in the having its regard to the appeal, 7 nature, the importance and difficulty, the other costs the interest of the or parties, to be allowed., the fund other general person conduct to bear of the proceedings, the costs and all relevant circumstances. (3) The sum allowed include under sub paragraph (2) shall done all the work necessarily with including the appeal and properly in connection chargeable perusals, and not otherwise correspondence, attendances, authorities." and consulting The framers of sub paragraph it necessary of appeals (2) (quoted above) for some reason to set out a scale of instructiqn in this Court. fee did not consider to be paid in respect the assessment officer who As the Rules show, of the taxing "considers of fees is left to the good judgment must award a figure which he/ she reasonable". In other words, he exercises judicial discretion. (No.3) In the case of Premchand Raichand (1972) referred EA 162 at page Vs Quarry Services Court assessment 164, the East Mrican regarding of Appeal to an English decision of a brief fee which is the same thing as instruction fee and said: - [The correct approach in assessing a brief fee is, we think, to be found in the case of Simpsons Motor Sales (London) Ltd Vs Hendon Corporation (1964) 3 ALL. E.R.833 in which PENNYQUICKS, J., said "One must conducting envisage a hypothetical case counsel effectively capable of the particular but unable 8 or unwilling sometimes reputation. hypothetical the brief1 to insist demanded on the particularly high fee, by counsel estimate would of pre-emine;~ t fee this on to take Then one must character what be content This approach adopted which we think decision reflects the correct approach was in the recent & Olumu by this Court in the case of Paul Ssemogerere Vs Attorney General Court expanded . - Civil Application No.5 of 2001 [unreported]. summary on the Pennyquicks . J'S of what the lawyers for each side had submitted to' him. In Ssemogerere case this Court stated: "In our view, there is no fonnula instruction whereby fee. the The exercise taxing officer by which to calculate balancing weigh the act the are fee. is an intricate has to mentally diverse general principles applicable, which sometimes, against one another in order to arrive at the reasonable T1w.s while the taxing officer has to keep in mind that the successful incurred party due must be reimbursed to should the litigation, expenses and that reasonably advocates, remuneration be at such level as to attract recruits he has to balance that with his that Also in the into the legal profession, duty to the public not to allow costs to be so hiked to only the wealthy. consistency courts would remain accessible while the taxing officer is to maintain level of costs, it is settled that he has to make allowance for the fall, if any, in the value of money. consideration for this intricate balancing It is because exercise of thpt 9 taxing officer's opinion on what is the reasonable to be interfered reason Raichand Uganda Departed Brothers with lightly. such case See fee} is not There has to be a compelling Premchand General (Supra); Vs and to justify Ltd. Blanket Asians (Supra). interference. (Supra). Attorney Ltd. Manufactures Property Custodian Board Vs Jaffer These considerations apply to a taxing officer as well as to a single judge or a court reviewing taxed costs. " Since there is no mathematical prosecuting formula for calculating an appeal, the this instruction appears fee for or defending approach. to us to be a compromise What is required judiciously of a taxing officer is to exercise his or her discretion reasonable." As stated so as to award an amount he/ she "considers of balancing lies. fee: That of course is where the problem set out guidance International HCB 11 in the taxation in Ssemogerere case (supra) we have many cases of this of instructions Court which See Makula Another Kampala Ltd Vs H.E. Cardinal and The Asians Registered Property Nsubuga and Trustees of of Custodian Yet in spite of by awarding (1982) Institute Vs Departed Board, Civil Application 3 of 1993, among others. erring these guidelines, taxing officers continue exhorbitant costs as instruction fee. Rule 101 (1) of the Rules of this Court gives this court assess costs. It states: - power to 10 "When costs, taxed making the Court " any decision as to payment them of to be may assess or direct In view of these provisions and the apparent inability by taxing officer;;,to follow guidelines set out by decisions of this Court, it may be time now for this Court itself to assess costs at the conclusion of each Civil Appeal. At any rate taxing officers can be fee is assessed by the left to tax disbursements court. while instruction Normally the court would know the nature of Mr. Muziransa should of the case on have The contention in effect is that the amount have been made should of the Court was the the basis of which taxation been the amount namely appeal. shs. set out in the decree because interest that of Appeal of the He 64,945,000/= basis That amount includes at the rate of 20%. relied on a number of decisions of this Court. One of the decision is General Parts Vs NPART (supra) which in our view is not quite to the point. reference In that case a single Justice had ruled, on a to him from a taxing officer, that no amount of money arose. he was was involved in arguing Upon his ruling being the appeal from which the taxation referred to the Court where criticised for that holding, in that been the full Court agreed with him that the was a point of law. in the appeal. No amount of point argued money increased had appeal involved The Court, on grounds however which do the award from 5m/= reference. to 15m/= not arise in the present Kassam's case (supra). Mr. Muziransa also relied on of That is a decision of a single Justice 11 this Court, reference submitted shs. 60m/= as instruction additional the present low. Mukasa Kikonyogo, ruling JSC, as she then was. of a Registrar. matter It was a from a taxation that in that Mr. Muziransa of litigation shs. was case the subject and that the single Justice fees and a further had awarded IS::.n/= shs. Sm / = as fees for arguing argued that in award of shs. Sm/ = is too grounds. On the basis of that, counsel case the single Justice's We think present that case. that Kassam's case is distinguishable the original from the which 70m/=. ~ In the fIrst instance, of litigation that that amount was the subject in Kassam's case was shs. amount was the issue involved in that involved most Even if it is assumed decision that and that for the appeal, in the that was the amount more than and amount is clearly the amount this is the presen t case. distinction, Secondly, important the principal issue argued in Kassam's appeal in this of Act, that Court involved one main point of law, namely the interpretation Sections 1982 11 (2) and 14 (1) of the Expropriated 8 of the Regulations in Kassam's Properties made under and Regulation Act. Counsel appeal grounds for the appellant two sums case lodged a bi)l in fees to argue the additional which he claimed one as instruction and the second of appeal. as instructions fees for arguing The taxing officer awarded to the appellant of shs 30m/ = in respect the latter. of the former and shs ISm/ = in respect before the single Justice were grounds 2 and 5. In the reference in that case the complaints about these amounts 12 A number of cases of this Court as well as rule 9 (2) and She referred (3) (supra) were cited to the single Justice. and the law and stated to the cases stated the that the taxing officer correctly law [Rule 9 (2) and (3))] and the principles She held that excessive, held that an award laid down on taxation. the appeal was of shs 30m/ = to argue she reduced IS/= it to ISm/=. and therefore an award She further grounds was shs of shs for arguing additional was excessive 70m/= aspect since the amount involved in the appeal and reduced this last award to shs Sm/=. against This particular by, Mr. of Kassam's case is actually that fail. next consider ground the award the argument Muziransa where therefore We shall of shs Sm/ = is too low in an appeal Ground [b] must the amount involved is say shs 64m/=. (c). With respect to Mr. Muziransa, erred we have not been persuaded exercised/ applied that the leamed wrong fee. principles Justice' in and/ or determining/ support assessing the instruction Mr. Muziransa In his affITTIlation in of the reference, stated: 3. "That in assessing and determining the reduction, misapp lied the the Learned Justice erred and/or misguided principles of taxation and he based himself when his decision on authorities not applicable to the matter at hand. 4. That the subject matter appeal invo lved complicated questions of law and fact. 13 5. That the learned failed inflation appeal issues original at to properly and hand Judge take fact as erred into that disposal in principle when he the consideration the the subject parties the matter and the in (sic) was a final of all matters between suit." The fIrst is that the Justice of taxation. questions The second of law. failed to is that the There are three complaints. apply properly appeal to take inflation complaints. did not direct the principles into account. involved complicated The last is failure We have in a way dealt with these contended that the leamed goveming Justice of Mr. Muziransa his mind to the principles taxation costs in this Court and relied on the Kassam International puzzled Case (Supra) and case (supra) Habre (3). We are Rule 9 (2) and by these contentions of Mr. Muziransa. The record by Dr. before us does not include counsel, Byamugisha but in his the address the to the single Justice Justice states that ruling, had cited a number of cases including Premcharnd Richard Vs Quarry Servicesof East Africa(1972) EA 162, Bank of Uganda Vs Banco Arabe Espanol,and Attorney General Vs= Uganda Blankets, and authorities Muziransa on the already. addressed decision rule The 9 (2). Justice Court in We have further General mentioned states Parts that these Mr. him on the same Paragraph of this 9 (2) as well as Vs .Non performing Assets recovery Trust, (supra) to support that the taxing officer had applied proper of taxation in this case and that and relevant taken he had the view principles into inflation 14 account. (supra). Mr. Muziransa had also relied on Kassam's case Then the learned Justice opened his opinion with these words: "Having perused the record ruling heard of the counsel learned for both ofproceedings officer and that and and the taxing parties having the reviewed authorities of the taxing provisions cited, it is my opinion of this the decision by the officer Court is guided of Rules 9 of the Rules of this Court" The Justice concluded then that analysed he was the figures in the proceedings decision as Bank and guided by such of the and Uganda Vs Banco Arabe EspanoljSupra),Attorney-GeneralVs Non - Performing Assets Recovery trust (Supra) and RegisteredTrustees of Kampala Institute Departed Asians Vs Property Custodian Board. Mter amounts awarded, the learned Justice alluding to the figures revised the award given by With respect criticised we do the learned and did of the taxing officer from shs 16m/= not see the basis Justice on grounds to Sm/=. on which Mr. Muziransa that the Justice misguided himself not properly apply the law and principles applicable to taxation costs in this Court. Court contains taxation Rule 9 of the 3rd Schedule provisions to the Rules of this govern That the principal of the law which of instruction fee by taxing by counsel officers in this Court. and the Justice law was cited to the Justice The Justice In these circumstances, applied it. of the relied on cases cited to him by counsel we fmd Mr. Muziransa's for both sides. criticism 15 Justice therefore, both fail. unwarranted and baseless. Ground. (C) must, Ground (d): has been set out earlier. In the foregoing discussions, we have disposed Justice of this ground. In any is not so Cases relied on by the leamed case, in considering prohibited cited by both sides. before him a Justice any issue raised authorities from considering authorities not cited by counsel to the controversy long as such the parties are relevant between Ground (d) must fail. We now discuss the instruction Justice argued ground (a). Mr. Muziransa's Sm/= which was complaint awarded is that by the in law. by the the that of fee of shs leamed Counsel taxing Justice because shs latest which Justice was manifestly that the amount inadequate of shs and an error 16m/ = awarded officer was not manifestly for relying of inflation on cases the Justice excessive. in 1990, He criticised contending decided should have upheld the award referred 16m/=. On the other hand on the subject Dr. Byamugisha to the decisions case and these have been cited eC\;rlier We do not agree General that the in this ruling. The case in point is General Parts (U) Ltd (Supra) also alludes to inflation. relied on the decisions on 12/1/2001 of 1990s. Parts (Supra) was decided (supra) decided decisions. consideration. by a bench of three. Bank ofUganda case was are recent for his was decided by a single All of on 19th April 2000 and Kassam's Justice them on 12/1/2000. cited to the states These Justice that were In his ruling the Justice he reviewed 16 all the cases guided ruling General view that general Court. cited to him. same He specifically cases, that among stated others. that he was the on the by two of these of the Justice Indeed relied reflect indicates Mr. Muziransa before the Justice which Parts case, in his submission General Parts that for the is one of the cases in taxation principle are applied of costs in this We agree that inflation costs is done. has to be bome in mind when taxatiqn accept costs. that inflation should of But we cannot exhorbitant be a basis for awarding in paragraph Many other factors set out - (2) of rule 9 of Schedule3 must be considered Moreover, we think that under Rule 105 (3) of the Rules, a Justice exercises decision discretion in deciding whether the bill of costs as taxed inadequate. He makes The Justice that he a is manifestly excessive or manifestly on the basis of materials before before him or her. in this reference us demonstrated in his ruling reviewed the materials Court available before him including the Rules of or and the case law. We have power to vary, discharge reverse decision persuaded injudiciously that of the single Justice. the leamed Justice However we have not been exercised the fail. his award discretion from shs and or wrongly Ground in reducing 16m/= to 5m/=. In the result dismissed. (a) must therefore is unsuccessful. the reference The respondent The application is shall have the costs of this reference and those before the single Justice. 17 Dated at Mengo the fJ,ff!s: day Of...~; 2003. ~=--n A.N. KAROKORA JUSTICE OF SUPREME COURT CoM. J:o JUSTICE OF SUPREME COURT [~~ kiPCl'~ ~1Q..UL n, v~c\ "C1A. v~" 1:ft4~~~ t) Dc it P f);J/tf; ~'tJ I -~ u,-/n v<::rc1 /J; '& .. ..J c L-- f