Wakilii

Tumwesigye and Company Advocates v Hirra Trading (U) Limited and Another (Misc Cause 57 of 2020)

High Court · [2022] UGCOMMC 124 · 2022 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for leave to present advocate-client bill of costs for taxation
Decision
Leave granted to proceed to taxation of advocate-client bill of costs

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The court held that an oral contingency fee agreement whereby an advocate receives a percentage of the sum recovered from a judgment debtor is void under the Advocates Act s.55(1)(b) and the Advocates (Professional Conduct) Regulations Regulation 26, which prohibit agreements for sharing proceeds of a judgment. Further, any fee agreement must comply with s.51 of the Advocates Act by being in writing, signed by the client, and notarially certified. Where no compliant written agreement exists, the appropriate mode of resolving fee disputes is taxation of an advocate-client bill of costs, and leave was granted to the applicants to proceed to taxation.

Outcome

Leave granted to proceed to taxation of advocate-client bill of costs

Facts

The applicant law firm was retained by the respondents to prosecute High Court Civil Suit No. 52 of 2012 and related bankruptcy proceedings. The suit was filed in February 2012 and judgment was delivered in the client's favour in November 2015. Upon completion of the litigation, the applicants demanded payment of legal fees. The respondents refused, contending that an oral agreement existed whereby they paid shs. 1,000,000 upfront and the applicants were entitled only to 50% of any sum recovered from the judgment debtor. The applicants denied any such agreement and sought leave to present an advocate-client bill of costs for taxation. The respondents maintained that the oral agreement was binding and that the demand was premature as the litigation had not ended. The applicants served a detailed bill of costs on the respondents on 21 September 2020, more than 30 days before the application.

Issues

  1. Whether an oral contingency fee agreement whereby an advocate receives a percentage of the sum recovered from a judgment debtor is valid and enforceable under Ugandan law.
  2. Whether the applicant advocates are entitled to leave to present an advocate-client bill of costs for taxation where no written fee agreement complying with statutory requirements exists.

Orders

  • Application allowed.
  • Leave granted to the applicant to present advocate-client bill of costs for taxation.
  • Costs of the application to be borne by the respondents.

Rules and key headnotes

Employment & Labour — Advocates' Remuneration — Contingency Fee Agreements — Prohibition Against Sharing Proceeds of Judgment
An agreement by which an advocate retained to prosecute contentious proceedings stipulates for payment of a percentage of the proceeds of a judgment, whether as professional fees or otherwise, is void under s.55(1)(b) of the Advocates Act and Regulation 26 of the Advocates (Professional Conduct) Regulations as constituting champerty.
Employment & Labour — Advocates' Remuneration — Fee Agreements — Formal Requirements for Validity
An advocate-client fee agreement is enforceable only if it complies with s.51(1) of the Advocates Act by being in writing, signed by the client, and containing a certificate signed by a notary public (other than one party to the agreement) confirming that the nature of the agreement was explained to the client who appeared to understand it, with a copy of the certificate sent to the Law Council.
Employment & Labour — Advocates' Remuneration — Taxation of Costs — Mode of Resolving Fee Disputes in Absence of Written Agreement
Where no compliant written fee agreement exists between advocate and client, the appropriate mode of resolving a dispute over fees payable is taxation of the advocate-client bill of costs under ss.57 and 58 of the Advocates Act.
Civil Procedure — Taxation of Costs — Advocate-Client Bills — Procedural Requirements for Taxation
An advocate seeking to recover fees must serve on the client a signed, itemised bill of costs either personally or by registered post. The advocate cannot commence suit to recover costs until one month after delivery of the bill, during which period the client may demand taxation. If the client does not demand taxation within that period, the advocate may apply to court for leave to tax the bill.
Civil Procedure — Case Stated — Conditions for Referring Question of Law to Higher Court
A registrar or lower court may state a case to a higher court where there is a real and substantial point of law open to serious argument, the point is clear-cut and capable of being accurately stated as a point of law (not fact), and resolution of the point is necessary for proper determination of the case. The higher court determines the matter based on the facts in the stated case and may reverse, affirm, or amend the determination.

Legislation cited (14)

Cases cited (3)

  • Shell (U) Ltd and nine others v Muwema & Mugerwa Advocates and Solicitors and another (S.C. Civil Appeal No. 2 of 2013)
  • DPP (Travers) v. Brennan [1998] 4 IR 67 at 70
  • Halfdan Greig & Co. A/S v. Sterling Coal and Navigation Corporation and A. C. Neleman's Handel-En Transportonderneming (The "Lysland") [1973] 1 Lloyd's Rep. 296

Full judgment

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Tumwesigye and Company Advocates v Hirra Trading (U) Limited and Another (Misc Cause 57 of 2020) [2022] UGCommC 124 (18 March 2022)
Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.