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Western Highland Creameries Limited and Another v Stanbic Bank Uganda Limited (Civil Appeal 78 of 2014; Civil Appeal 79 of 2014)

Court of Appeal · [2023] UGCA 297 · 2023 Appeals Dismissed ✦ AI-generated summary ↓ Download
Jurisdiction
Uganda
Case Type
Consolidated civil appeals from two High Court (Commercial Division) decisions on taxation appeals concerning the assessment of instruction fees
Decision
Both consolidated appeals dismissed with costs to the respondent; High Court decisions upheld

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Holding

The Court of Appeal dismissed both consolidated appeals concerning the taxation of instruction fees. It held that a suit dismissed on a preliminary point of law (limitation) is a decree under s.2(c) of the Civil Procedure Act, so the value of the subject matter discernible from the plaint properly governs the fee assessment under item 1(a)(iv) of the Sixth Schedule, not item 1(a)(vii). It further held that the taxing master's discretion under s.55(3) of the Advocates Act is subject to the regulations, so where the Schedule prescribes a value-based mathematical formula there is no discretion to vary the basic fee. The High Court's refusal to order an immediate refund of the guarantee amount, pending inter partes re-taxation, was a proper exercise of discretion.

Facts

The appellants sued the respondent bank and others in the High Court (Commercial Division) alleging breaches of mortgage, debenture and charge instruments, seeking recovery of possession of land, plant and business, or in the alternative restitution valued at US$5,000,000 and damages for economic loss of UGX 36,818,885,665. The suit was dismissed as time-barred. The respondent's bill of costs was taxed and instruction fees were the contested item. After successive taxation rulings and references, the High Court Judge held that the dismissal produced a decree, that the subject-matter value could be discerned from the plaint, and that instruction fees fell to be assessed under item 1(a)(iv) of the Sixth Schedule. A revised certificate of taxation awarded UGX 499,676,356 in instruction fees plus VAT, paid under a bank guarantee, before being set aside for breach of fair hearing, with re-taxation directed. The appellants appealed both the fee-scale ruling and the refusal to order a refund.

Issues

  1. Whether a suit dismissed on a preliminary point of law (limitation) results in a decree such that the value of the subject matter governs the assessment of instruction fees.
  2. Whether instruction fees should be assessed under item 1(a)(iv) (value of subject matter) or item 1(a)(vii) of the Sixth Schedule to the Advocates (Remuneration and Taxation of Costs) Regulations.
  3. Whether section 55(3) of the Advocates Act confers on the taxing master a discretion to increase or decrease the basic instruction fee calculated under the Sixth Schedule.
  4. Whether the High Court ought to have ordered the respondent to refund the guarantee amount paid under a certificate of taxation that was later set aside for breach of the right to a fair hearing.

Orders

  • Civil Appeal No. 78 of 2014 dismissed with costs to the respondent.
  • Civil Appeal No. 79 of 2014 dismissed with costs to the respondent.

Key headnotes

Civil Procedure — Costs — Effect of dismissal on a preliminary point of law — Decree or order
A dismissal of a suit on a preliminary point of law, such as limitation, conclusively determines the controversy between the parties and constitutes a decree within the meaning of section 2(c) of the Civil Procedure Act, even where it is worded as an order.
Civil Procedure — Costs — Taxation — Instruction fees — Applicable fee scale where suit dismissed
Where a suit is dismissed and the value of the subject matter can be determined from the amount claimed in the plaint, instruction fees are assessed on that value under item 1(a)(iv) of the Sixth Schedule to the Advocates (Remuneration and Taxation of Costs) Regulations, and not under item 1(a)(vii).
Statutory Interpretation — Advocates Act s.55(3) — Discretion of taxing master limited by regulations
The discretion of the taxing officer under section 55(3) of the Advocates Act is expressly subject to the regulations, and is therefore limited by the Sixth Schedule; where the Schedule prescribes a mathematical formula based on an ascertained subject-matter value, the taxing master has no discretion to increase or decrease the basic instruction fee.
Statutory Interpretation — Ordinary and plain meaning of unambiguous words
Words in a statute must be given their ordinary, natural and plain meaning where there is no ambiguity.
Civil Procedure — Appeal — Interference with exercise of judicial discretion
An appellate court will not interfere with a lower court's exercise of discretion unless satisfied that the lower court misdirected itself and as a result arrived at a wrong decision, or that it is manifest the court was clearly wrong resulting in a failure of justice.
Civil Procedure — Costs — Refund following annulment of a certificate of taxation
Where a certificate of taxation was a lawful and enforceable court order at the time payment was received under a bank guarantee, a court that subsequently sets it aside retains a discretion as to refund and may direct that any refund follow inter partes re-taxation rather than ordering immediate restitution.

Legislation cited (7)

  • Civil Procedure Act, Cap. 71 s.2(c)
  • Advocates Act, Cap. 267 s.55(3)
  • Advocates (Remuneration and Taxation of Costs) Regulations, S.I. No. 267-4, Sixth Schedule item 1(a)(iv)
  • Advocates (Remuneration and Taxation of Costs) Regulations, S.I. No. 267-4, Sixth Schedule item 1(a)(v)
  • Advocates (Remuneration and Taxation of Costs) Regulations, S.I. No. 267-4, Sixth Schedule item 1(a)(vii)
  • Advocates (Remuneration and Taxation of Costs) Regulations, S.I. No. 267-4 Regulation 13
  • Constitution of Uganda Article 28

Cases cited (18)

  • Makula International Ltd V. Cardinal Nsubuga [1982] HCB 11
  • Alexandra Jo Okello v Kayondo and Company Advocates (Supreme Court Civil Appeal No. 1 of 1997)
  • Attorney General v Uganda Blanket Manufacturers (1973) Ltd (Supreme Court Civil Application No. 17 of 1993)
  • Shumuk Investments Ltd v Noble Builders (U) Ltd and Others (High Court Civil Appeal No. 24 of 2010)
  • Nicholas Roussos v Gulam Hussein Habib Virani and Others (Civil Appeal No. 30 of 1998)
  • the Registered Trustees of Kampala Institute Vs Departed Asians Property Custodian Board, Supreme Court Civil Application No.0003 of 155
  • Lumweno and Company Advocates v Transafrica Assurance Company Ltd (Civil Application No. 95 of 2004)
  • Mayers, vs Hamilton [1975] E.A 16
  • Bank of Uganda v Banco Arabe Espanol (Supreme Court Civil Application No. 23 of 1999)
  • Hwan Sung Ltd v M and D Timber Merchants and Transporters Ltd (Supreme Court Civil Appeal No. 2 of 2018)
  • Murisho Shafi and 5 Others v Attorney General and Inspectorate of Government (Constitutional Application No. 2 of 2017)
  • The Returning Officer Kampala and Another v Margaret Ziwa (Civil Appeal No. 39 of 1997)
  • Premchand Raichand Ltd & Another Vs Quarry Services of East Africa Ltd and Others (No. 3) [1972], 1 EA 162
  • Shumuk Springs Development Ltd and Others v Mwebesa and Others (High Court Taxation Appeal No. 21 of 2012)
  • Yahaya Kariisa v Attorney General (High Court Civil Appeal No. 315 of 2002)
  • Bob Kasango v Attorney General and Another (Constitutional Petition No. 16 of 2016)
  • Banco Arabe Espanol v Bank of Uganda (Supreme Court Civil Appeal No. 8 of 1998)
  • Mbogo and Another v. Shah (1968) E.A.93
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