C. C. Chandran v Kengrow Industries Ltd (Civil Application No. 22 of 2002)

Supreme Court · [2003] UGSC 60 · 2003 Application Dismissed ✦ AI-generated summary ↓ Download

Jurisdiction

Uganda

Case Type

Reference to the full Court from the ruling of a single Justice on a taxation of costs reference

Decision

Reference dismissed; the single Justice's reduced instruction fee of shs 5,000,000 stands

The full judgment

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Holding

The applicant referred to the full Court a single Justice's ruling that reduced taxed instruction fees from shs 16m to shs 5m. The Supreme Court held that the single Justice had correctly applied rule 9 of the Third Schedule and the settled principles governing taxation, had properly found the relevant subject matter of the appeal to be about shs 30m, and had not exercised his discretion wrongly. A taxing officer's (or reviewing Justice's) opinion on a reasonable instruction fee will not be interfered with lightly, only for a compelling reason; inflation is relevant but cannot justify exorbitant costs. The reference was unsuccessful and the application dismissed with costs.

Facts

The applicant, C. C. Chandran, had been the successful respondent in an earlier Supreme Court appeal in which Kengrow Industries Ltd was the unsuccessful appellant. The applicant presented a bill of costs to the Registrar, sitting as taxing officer, who awarded shs 16,000,000 as instruction fees. On a reference by Kengrow Industries Ltd, a single Justice (Kanyeihamba JSC) found that award manifestly excessive and reduced it to shs 5,000,000, computing the subject matter of the appeal at slightly over shs 30,000,000 (a USD 12,600 award plus other sums, including shs 5,000,000 general damages). Dissatisfied, the applicant referred the matter to the full Court, contending the subject matter was about shs 64,945,000 and that shs 5,000,000 was manifestly inadequate.

Issues

Whether the single Justice misdirected himself on the facts and the law in finding that the subject matter of the appeal was about shs 30,000,000.
Whether the single Justice applied wrong principles in assessing the instruction fee and erred in relying on authorities other than those cited by the applicant.
Whether the instruction fee of shs 5,000,000 awarded by the single Justice was manifestly inadequate and an error in law.

Orders

The reference is unsuccessful.
The application is dismissed.
The respondent shall have the costs of this reference and those before the single Justice.

Key headnotes

Civil Procedure — Costs — Taxation of instruction fees — Interference with taxing officer's discretion

The opinion of a taxing officer, single Justice or reviewing court on what constitutes a reasonable instruction fee is an exercise of judicial discretion that will not be interfered with lightly; there must be a compelling reason to justify such interference.

Civil Procedure — Costs — Assessment of instruction fees — No mathematical formula

There is no formula by which to calculate an instruction fee; assessment under rule 9(2) of the Third Schedule is an intricate balancing act in which the taxing officer weighs the value and importance of the appeal, the interests of the parties and all other relevant circumstances to arrive at a sum he considers reasonable.

Civil Procedure — Costs — Relevance of inflation and value of the subject matter

While the fall in the value of money must be taken into account in taxing costs, inflation cannot be a basis for awarding exorbitant costs, and a bill of costs that approaches or exceeds the value of the subject matter of the litigation is to be discouraged, though each case must be decided on its own facts.

Civil Procedure — Costs — Power of the Court to assess costs itself

Under rule 101(1) of the Rules of the Supreme Court the Court may itself assess costs rather than direct them to be taxed, and given the persistent failure of taxing officers to follow established guidelines it may be appropriate for the Court to assess instruction fees at the conclusion of each civil appeal, leaving taxing officers to tax disbursements.

Legislation cited (7)

Rules of the Supreme Court, Third Schedule, rule 9(2)
Rules of the Supreme Court, Third Schedule, rule 9(3)
Rules of the Supreme Court, rule 101(1)
Rules of the Supreme Court, rule 105(3)
Rules of the Supreme Court, rule 105(7)
Rules of the Supreme Court, rule 41(1)
Rules of the Supreme Court, rule 1(3)

Cases cited (10)

A.A. Kassam and 2 Others v Habre International (Civil Application No. 16 of 1999)
General Parts (U) Ltd v Non-Performing Assets Recovery Trust (Civil Application No. 21 of 2000)
Bank of Uganda v Banco Arabe Espanol (Civil Application No. 23 of 1999)
Attorney General v Uganda Blankets Manufacturers (Civil Application No. 17 of 1993)
Premchand Raichand v Quarry Services (No.3) [1972] EA 162
Simpsons Motor Sales (London) Ltd v Hendon Corporation [1964] 3 All ER 833
Paul Ssemogerere & Olum v Attorney General (Civil Application No. 5 of 2001)
Makula International Ltd v H.E. Cardinal Nsubuga and Another (1982) HCB 11
Registered Trustees of Kampala Institute v Departed Asians Property Custodian Board (Civil Application No. 3 of 1993)
Departed Asians Property Custodian Board v Jaffer Brothers Ltd

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