Wakilii

National Medical Stores and Another v Magezi (Taxation Cause No.2 of 2014; Taxation Cause No.4 of 2014)

East African Court of Justice · [2015] EACJ 114 · 2015 Costs Taxed and Allowed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Taxation of bills of costs following successful applications for costs after applicants were wrongly impleaded as interested parties in a reference and subsequently withdrawn
Decision
Bills of costs taxed and allowed in reduced amounts

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The Taxing Officer overruled the respondent's objection to representation, finding that the advocates had complied with the Court's Rules by filing practicing certificates and that the company had properly appointed representatives by resolution. On taxation, the Taxing Officer held that instruction fees could not be based on the monetary claim in the underlying reference because the reference was a Treaty interpretation matter under Article 30, not a claim for recovery. Applying discretion and maintaining consistency with awards in similar cases where parties were wrongly impleaded, the Taxing Officer awarded USD 12,000 instruction fees per party (USD 8,000 for the reference and USD 4,000 for the applications) plus 18% VAT, together with assessed costs for drawings, attendances, and disbursements.

Outcome

Bills of costs taxed and allowed in reduced amounts

Facts

The applicants, National Medical Stores and Quality Chemicals Industries Ltd, had been impleaded as interested parties in Reference No. 5 of 2013, a Treaty interpretation matter brought by Godfrey Magezi against the Attorney General of Uganda. After the interested parties filed responses, the applicant in the reference amended his reference and withdrew it against them. The applicants then filed separate applications (consolidated as Applications Nos. 8 and 9 of 2014) seeking costs. The Court ruled on 19 June 2014 that the applicants were entitled to costs. The applicants filed bills of costs totalling USD 257,643.97 and USD 309,086 respectively, claiming instruction fees based on a USD 17.8 million figure referenced in the underlying case. The respondent opposed the bills, arguing that the applicants were not parties entitled to costs under the applicable scale, that instruction fees should be minimal, and that National Medical Stores had not properly procured legal services under Ugandan public procurement law.

Issues

  1. Whether the objection to the representation of National Medical Stores on grounds of alleged non-compliance with public procurement laws should be sustained.
  2. Whether the applicants, having been wrongly impleaded as interested parties and subsequently withdrawn, are entitled to costs and on what basis instruction fees should be assessed.
  3. What is the appropriate scale of charges for taxation of costs where parties were wrongly impleaded and withdrawn at a preliminary stage.
  4. Whether instruction fees should be calculated based on the monetary value claimed in the underlying reference or on the nature of the proceedings as a Treaty interpretation matter.

Orders

  • Objection to representation of National Medical Stores overruled.
  • Taxation Cause No. 2 of 2014 (National Medical Stores v Godfrey Magezi): instruction fees inclusive of 18% VAT in the sum of USD 14,160 plus drawings, perusals, attendances and disbursements in the sum of USD 28,669.49, making a grand total of USD 42,829.49.
  • Taxation Cause No. 4 of 2014 (Quality Chemical Industry Ltd v Godfrey Magezi): instruction fees of USD 14,160 plus drawings, perusals, attendances and disbursements in the sum of USD 3,852, making a grand total of USD 18,012.

Rules and key headnotes

Representation — Corporate Parties — Compliance with Court Rules
A corporation may be represented before the East African Court of Justice either by its director, manager or secretary appointed by resolution under seal, or by an advocate who files a certificate of entitlement to appear before a superior court of a Partner State. Where advocates have filed certified copies of practicing certificates and the corporation has produced a resolution appointing representatives, the requirements of Rule 17 of the East African Court of Justice Rules of Procedure 2013 are satisfied.
Costs — Objections to Representation — Timing and Notice
An objection to a party's representation on grounds of alleged non-compliance with procurement laws cannot properly be raised for the first time at a taxation hearing without prior notice, particularly where the same advocate represented the party throughout the proceedings and filed all required documentation with the Court.
Taxation of Costs — Wrongly Impleaded Parties — Basis for Assessment
Where parties have been wrongly impleaded as interested parties in a reference and the matter is withdrawn against them at a preliminary stage before any substantive hearing, instruction fees cannot be assessed on the basis of a monetary value claimed in the underlying reference where that reference is a Treaty interpretation matter under Article 30 and not a claim for recovery of a specific sum.
Taxation of Costs — Discretion of Taxing Officer — Consistency in Awards
In exercising discretion under Rule 9 of the Third Schedule to the East African Court of Justice Rules, a taxing officer must allow a sum that is reasonable taking into consideration the nature, importance and complexity of the matter, while maintaining consistency with awards made in similar cases and ensuring that costs do not rise to a level that would deny access to justice.
Taxation of Costs — Getting Up Fees — Preliminary Stage Withdrawal
No fee for getting up is chargeable under Rule 2(ii) of the Third Schedule until a case has been confirmed for hearing. Where parties are withdrawn at a preliminary stage before the matter is confirmed for hearing, getting up fees must be taxed off.

Legislation cited (29)

  • Treaty for the Establishment of the East African Community Article 6(d)
  • Treaty for the Establishment of the East African Community Article 7(2)
  • Treaty for the Establishment of the East African Community Article 8(1)(c)
  • Treaty for the Establishment of the East African Community Article 23
  • Treaty for the Establishment of the East African Community Article 27(1)
  • Treaty for the Establishment of the East African Community Article 30
  • Treaty for the Establishment of the East African Community Article 30(1)
  • East African Court of Justice Rules of Procedure 2013 Rule 17
  • East African Court of Justice Rules of Procedure 2013 Rule 17(3)
  • East African Court of Justice Rules of Procedure 2013 Rule 17(5)
  • East African Court of Justice Rules of Procedure 2013 Rule 51(2)
  • East African Court of Justice Rules of Procedure 2013 Rule 111(i)
  • East African Court of Justice Rules of Procedure 2013 Rule 113
  • East African Court of Justice Rules of Procedure 2013 Rule 113(1)
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 1(b)
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 1(e)
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 1(h)(vii)
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 2
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 2(ii)
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 3
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 4
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 5
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 6
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 7
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 9
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 9(2)
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 9(4)
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 11
  • East African Court of Justice Rules of Procedure 2013 Third Schedule Rule 11(1)

Cases cited (8)

  • Prof. Anyang Nyongo (Taxation Cause No. 6 of 2008)
  • Premchand Raichand and Another v Quarry Services of East Africa Ltd and Others [1972] EA 162
  • First American Bank of Kenya vs Shah and Others
  • Modern Holdings Limited
  • McPherson v BNB Paribas [2004] 3 All ER 226
  • Hon. Sam Njuba v Hon. Sitenda Sebalu (Taxation No. 1 of 2013)
  • The Clerk of the National Assembly of Kenya v Prof. Anyang Nyongo & Others (Taxation Cause No. 3 of 2010)
  • Syno Hydro

Full judgment

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The original judgment as reported. Read the original PDF before relying on any passage.

National Medical Stores and Another v Magezi (Taxation Cause No.2 of 2014; Taxation Cause No.4 of 2014) [2015] EACJ 114 (7 September 2015)
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