MAKONI
JA: This
is an appeal against the whole judgment of the High Court which set
aside the decision of the taxing master, the second respondent, to
allow an advocate's fees at taxation.
The
facts of the matter are, to a large extent, common cause. They are
as follows.
The
appellant sued the first respondent for the recovery of a debt under
HC8103/14. The first respondent counter claimed for damages for
malicious prosecution. After a 3 day trial, the court found for the
appellant and awarded him costs on a legal practitioner/client scale.
The first respondent appealed against that decision and the appeal
was resolved on the basis of a settlement that left the order of
costs intact.
There
was a dispute over the appellant's costs claim. This obliged the
appellant to tax the bill. To that end the parties appeared before
the second respondent. Among other disputes, that are no longer
relevant, the first respondent did not accept item no. 124 of the
bill which was a claim for the recovery of US$170,000.00 alleged to
be a fee payable to the advocate who appeared in the three-day trial.
The
second respondent dismissed the objection and allowed the recovery on
the basis that the fee had been incurred.
Aggrieved
by the decision of the second respondent, the first respondent sought
a review of that decision before the court a
quo.
His grounds for review, in the relevant part, were as follows;
“First
respondent's decision to allow Counsel's fees as a disbursement
in the total sum of US$170,000.00 on the mere presentation of
Counsel's invoice by second respondent was grossly unreasonable as
first respondent failed to apply her mind to the necessity or
reasonableness of such fee.
The
disbursement allowed in item 124 as counsel's fee was grossly
excessive, was not reasonably incurred and could not have been
allowed had the first respondent applied her mind to the question.”
The
issue that was before the court a
quo
was whether or not the second respondent had proceeded irregularly by
failing to enquire into whether or not it was proper to allow the
appellant to recover the alleged fee from the first respondent merely
on the basis that it had been found to have been incurred.
The
court a
quo
found that the allegation that the second respondent ruled that the
appellant was entitled to recover the alleged sum merely because it
was paid and that she had no power to enquire into the reasonableness
of the fees remained unchallenged throughout the proceedings before
it.
It
further found that failure to enquire into the reasonableness of the
disbursement was an abrogation of the second respondent's role. The
second respondent committed a grave irregularity by failing to
satisfy herself of the reasonableness of the disbursement.
The
court a
quo
further discounted the appellant's arguments that the first
respondent agreed that the fee was recoverable on the basis that the
agreement produced was not signed by the first respondent and further
that the issue was not raised at the taxation. It further discounted
the argument that the fee was a contingency fee on the basis that it
was not raised at taxation and that in any event the contingency fee
agreement was not produced.
The
appellant was dissatisfied with that judgment and appealed to this
Court on the following grounds:
1.
The Learned Judge misdirected himself in finding that second
respondent was clearly wrong in her decision to allow Advocate
Mpofu's fee.
2.
The Learned Judge misdirected himself in finding he had the legal
right to overturn the second respondent's decision to allow the
fee.
3.
The Learned Judge erred in failing to accept that respondent's
legal practitioners had paid the fee directly to Advocate Mpofu and
hence accepted the fee's reasonableness.
4.
The Learned Judge erred in overturning the fee in the circumstances.
Mrs
Wood
contended
that this was purely an academic exercise by the first respondent as
the impugned fee was paid to counsel. The first respondent had
accepted the reasonableness of the fees by making the payment. The
fee was based on a contingency agreement. The High Court rules do not
cater for fees charged on a contingency basis. One has to look at the
regulations governing contingency fees agreements. The onus
is on the losing party to show that the fee is unreasonable. It is
not for the winning party to justify the fees.
Per
contra
Mr Ochieng
submitted that the sum of US$170,000.00 was paid after taxation and
as a result of execution of the taxation order.
Regarding
the contingency agreement, he submitted firstly that the agreement
has never been exhibited. Secondly that if it exists, it is an
agreement between the appellant and his legal practitioners. It had
nothing to do with the first respondent. Thirdly that it was never
produced before the second respondent.
When
the first respondent objected to the reasonableness of the bill, only
a fee note was produced. This fact is uncontroverted. He further
submitted that the second respondent failed to carry out an enquiry
as to whether the fee was reasonable.
The
issue for determination is whether the court a
quo
had the power and was correct in setting aside the decision of the
second respondent on review.
Rule
307 provides:
“With
a view to affording the party who has been awarded an order for costs
a full indemnity for all costs reasonably incurred by him in relation
to this claim or defence and to ensure that all costs shall be borne
by the party against whom such order has been awarded, the taxing
officer shall on every taxation allow all such costs, charges and
expenses as appear to him to have been necessary or proper for the
attainment of justice or for defending the rights of any party, but
save as against the party who incurred the same, no costs shall be
allowed which appear to the taxing office to have been incurred or
increased through over caution, negligence or mistake, or by payment
of a special fee to another legal practitioner, or special charges
and expenses to witnesses or other person or by other unusual
expenses.”
In
terms of the above rule, a taxing officer is expected to conduct an
enquiry into the reasonableness of fees and disbursements that a
successful litigant claims from his adversary.
To
discharge that obligation, the rule confers upon a taxing officer a
discretion to allow costs, charges
and expenses incurred by a party which appear to him to have been
necessary or proper for the attainment of justice or
defending the rights of any party.
Such taxation is
made in consonance with an existing order of costs granted by a court
which specifies the party to be indemnified and the extent of such
indemnification in general terms.
Once
a bill of costs is taxed, a party obtains the right to execute for
costs.
It
follows that in exercising the discretion conferred upon him, a
taxing officer may not allow the costs which have been incurred or
increased through over-caution, negligence or mistake, or by payment
of a special fee to another legal practitioner, or special charges
and expenses to witnesses or other persons or by other unusual
expenses.
Therefore,
a taxing officer can only allow bona
fide
and necessary costs on every taxation.
In
Puwai
Chiutsi Legal Practitioners v The Registrar of The High Court &
Anor
the court had this to say regarding the import of Rule 307 as to the
powers of a taxing officer and the statutory framework within which
such powers must be exercised:
“The
taxing officer is enjoined to allow all such costs, charges and
expenses as appear to him to have been necessary or proper for the
attainment of justice or defending the rights of any party. He must
be guided by the tariff of legal practitioner's fees prescribed in
the High Court (Fees and Allowances) Rules, regard being had to any
amendment to the tariff from time to time. (See Order 38) Rule 302.
The
taxing officer's powers of taxation emanate from the High Court
Act, its rules, and the regulations which are promulgated by the
Minister.”
Accordingly,
the tax officer's powers are regulated by law and may not be
exercised outside the parameters stipulated by the relevant laws.
While
allowing costs is the preserve of a taxing officer,
Rule 314 provides that if a party is aggrieved by the decision of the
taxing officer, made in terms of Rule 307, it may apply to the High
Court for a review of such taxation.
The
court may interfere with the decision made by a tax officer in
certain circumstances. The
principles applicable in review matters in terms of Rule 314 are the
same as apply to reviews in general.
In
Nourse Mines
v Clarke
1910 T.P.D. 660 at p 661 which was quoted with approval in Legal
and General Society Ltd v Lieberum, NO and Another
1968 (1) SA 473 (A) at 447, BRISTOWE J said:
“I
agree that if the Taxing Master had exercised his discretion this
Court would not overrule it. The jurisdiction of the Court to
overrule the discretion of another person or officer only arises
where the discretion has been improperly exercised, that is, where
the officer has been actuated by some improper motive, or has not
brought his mind to bear upon the question, or where he has adopted
some principle which the Court considers unsound. If, therefore, the
Taxing Master had considered the merits of this case, and decided
that it was not reasonable to allow two counsel, I should not have
interfered.”
At
home, in Cone
Textiles
(Private)
Limited
v Pettigrew
(Private)
Limited
& Anor
which was quoted by this Court in ICL
Zimbabwe Limited
v The
Taxing Master Supreme Court & Ors
it was stated as follows:
“The
principles by which the Court is to be guided when it is asked to
review the decisions of the Taxing Officer are well established.
SQUIRES
J set them out in Williams
v The Taxing Master supra
at 125, and they were repeated, although without reference to the
decision in Williams, by GOLDIN AJA in the Cone Textiles case supra
at 275F-G. He set out two grounds:-
'Firstly
on the application of common law rights on review which involve a
finding that he was grossly unreasonable or erred on a point of
principle or law.
In
such a situation the Court would be at large and entitled to
substitute its opinion for that of the Taxing Master (sic).
It should not be overlooked that even when such grounds for
interference exist it need not follow that the Taxing Master's
(sic)
decision must necessarily be set aside or altered. He may have
arrived at the correct decision for a wrong or even improper reason.
Secondly,
regardless of the absence of any common law ground for interference,
the Court has a duty to interfere if satisfied that the Taxing Master
(sic)
was clearly wrong in regard to some item. In such a case the Court
will substitute its own opinion for that of the Taxing Master (sic)
even if it is a matter involving degree.'
(See
also Ocean
Commodities Inc v Standard Bank of SA Ltd
1984 (3) SA 1 (A)).
This
second criterion has been called 'a graft on the main principle'.
The Court allows itself a wider power to interfere in the decision of
one of its own officers, because it is operating on familiar ground.
It
will be more hesitant to intervene in a discretionary decision by
other public officials or tribunals.'”
Consequently,
there are two instances in which a court may competently interfere
with the decision of a taxing officer. Firstly, where a
finding is made that the taxing officer's decision was grossly
unreasonable or that he erred on a point of principle or law.
Secondly, a court is entitled to interfere where the taxing officer
was clearly wrong regarding some item.
In
the recent case of Zizhou
v The Taxing Officer & Anor
the court made the following pertinent remarks at p3 of the judgment
relating to interference with a taxing officer's discretion:
“The
court is very slow to interfere with the exercise of the taxing
officer's discretion. It will not readily do so unless it is
satisfied that the taxing officer acted on some wrong principle or
did not exercise his or her discretion at all.”
In
that case, the court set aside the bill of taxed costs on the basis
that it was in contravention of the law. This was because the bill
was erroneously drawn up and denominated in United States dollars at
a time when the law demanded the exclusive use of the Zimbabwean
dollar in domestic transactions.
As
was correctly observed by the court a
quo,
what transpired before the second respondent is common cause. It is
captured in para 14 of the first respondent's founding affidavit
where it is stated:
“The
applicant further took issue with item 124, where the second
respondent sought to recover US$170,000 which he said was paid as a
fee to Mr Mpofu for the conduct of a three day trial. In answer to
the applicant's challenge, the officer representing the first
respondent simply produced an invoice appearing to originate from Mr
Mpofu. On that basis alone, the first respondent approved the item,
without enquiry into its reasonableness. In other words, she ruled
that it was recoverable simply because it had been paid.”
This
was not controverted by the appellant in his opposing affidavit.
Instead he sought to justify the amount.
The
first respondent's grounds for review attack this conduct of the
second respondent which was to allow the disbursement on the basis
that it had been paid.
The
issue that confronted the court a
quo
and still confronts this Court is whether the second respondent did
what was required of her in terms of Rule 307.
This
is the nub of the matter.
The
account given by the first respondent in para 14, quoted above,
clearly shows that she did not.
The
second respondent, after it had been established that the fee had
been accrued, did not enquire into whether it was recoverable from
the first respondent. She further did not enquire whether it was
necessary or proper.
All
the other issues raised by the appellant that the first respondent
accepted the reasonableness of the fee, that the onus
lay on the first respondent to establish that the amount claimed was
not reasonable and that there was a contingency agreement, are
irrelevant for the determination of the sole issue before the court.
Taking
them into account in the determination of this matter would amount to
converting this Court into a taxing authority. Those are the
arguments that should have been presented before the second
respondent to assist her to arrive at a correct decision.
As
was correctly observed by the court a
quo,
the contingency agreement was not produced before the taxing officer
neither was it produced before it.
Regarding
the issue of onus, proper interpretation of Rule 307 yield the result
that once the judgment debtor, at taxation, establishes a prima
facie
basis for objecting to an item, on the bill of costs, the onus
shifts to the judgment creditor to establish the reasonableness and
propriety of each item that it claims. This is in view of the
provisions of Rule 307 that the judgment creditor is entitled to
recover only that which the taxing officer is persuaded to allow. It
is the judgment creditor who seeks indemnity to the extent that it is
permissible and not the judgment debtor who seeks absolution to the
extent that it may be justified.
The
judgment creditor therefore bears the onus.
There
was clearly a basis for the court a
quo
to interfere with the discretion exercised by the second respondent
in arriving at a decision to allow the impugned item. She did not
bring her mind to bear to the task that was before her which was to
assess whether the claim was necessary or proper for the attainment
of justice.
The
appeal has no merit and ought to be dismissed.
The
first respondent prayed for costs on a higher scale on the basis that
the appeal appears to be an insincere bid to delay the recovery, by
the first respondent, of the monies paid to the appellant as a result
of the flawed proceedings before the second respondent. He also
attacked the insincere manner in which this appeal has been framed.
I
am persuaded by the arguments advanced by the first respondent to
award a special order of costs.
Right
from the onset the appellant steered away from the nub of the matter
which was an attack on the conduct of the second respondent. He
raised peripheral issues in the hope of pulling wool over the eyes of
the respondent and the court. Costs on a punitive scale are
warranted.
In
the result I make the following order:
1.
The appeal is dismissed.
2.
The appellant is to pay the first respondent costs on a legal
practitioner and client scale.
GWAUNZA
DCJ: I
agree
BERE
JA: I
agree
Venturas
& Samukange,
appellant's legal practitioners
Atherstone
& Cook,
1st
respondent's legal practitioners
1.
HH485/16
2.
1984 (1) ZLR 274 (SC)
3.
SC45/99
