Rachier wins first round of legal fee dispute with Kebs
Gor Mahia chairman Ambrose Rachier during an interview with Nation at his office in Nairobi on February 12, 2020.
A law firm associated with Rarieda MP Otiende Amollo and Gor Mahia Chairman Ambrose Rachier has won the first round of a Sh105 million legal fee note against the Kenya Bureau of Standards (Kebs) after a court threw out protests by the state body.
The law firm, Rachier & Amollo LLP, represented the state regulatory body in court in 10 cases whose value was Sh2 billion.
The cases were between Kebs and Dubai-based firm Geo-Chem Middle East Company and the dispute related to a breach of a contract dated June 5, 2009, for inspection of imported petroleum products.
After a prolonged legal dispute that was settled by the Supreme Court in December 2020, Kebs lost and the foreign company was awarded $15.4 million (Sh1,907,888,940) plus interest of more than Sh350 million.
The law firm furnished Kebs with a bill of Sh105,309,720. The process confirming the bill of costs began before a magistrate court’s deputy registrar, Ms Elizabeth Tanui, in 2022.
Kebs was aggrieved and moved to the High Court seeking to stop the process and to have the Advocate-Client bill of costs struck out.
According to Kebs, the law firm was not entitled to the fee as it had previously been paid legal fees of Sh237,867,421 to defend it at the High Court, Court of Appeal, and Supreme Court and there were no outstanding fees payable to the advocate.
Through its Legal Services/Corporate Secretary Miriam Kahiro, Kebs argued that the law firm had been retained by the regulatory body and there was a binding retainer agreement between them on legal fees. The agreement provided that the advocate’s legal fees would be charged as negotiated and agreed upon by the parties.
As a result, she said, the deputy registrar was precluded from proceeding with the process of assessing the amount of fee payable to the law firm for the work done.
Retainer Agreement
She said that the parties had a Retainer Agreement dated December 21, 2020, where legal fees were agreed upon. The court heard that the advocate had also raised a fee note dated July 13, 2021, of Sh14.5 million, which was paid.
Ms Kahiro said the advocate “could not now turn around and seek taxation (a process of assessing legal fee note) under the Advocates Remuneration Order (ARO) and that it was not entitled to any further fees as claimed in the Bill of Costs.
But Justice Alfred Mabeya dismissed Kebs’ request after finding that the agreement between the parties was per the ARO and that Kebs had not paid the fee note raised.
He said the fees raised by the law firm should proceed to assessment by the deputy registrar.
In addition, he found that though there was a retainer agreement, the law firm resorted to having the fees assessed under the ARO because Kebs failed to settle the fee note.
“In my view, where an advocate and client enter into an agreement such as the one before the court which state that the fees will be in accordance with the ARO or as shall be negotiated, once an advocate raises his fee note and demands settlement thereof and the same is settled, he cannot then go back on the same and seek to tax the bill under the ARO,” said Justice Mebaya.
He observed that the advocate can only resort to the ARO and assess the bill if the client fails to pay the fee note raised.
“In this case, the client failed to settle the fee note that was raised. The fees were, therefore, not negotiated and settled. It has to be in accordance with the ARO,” ruled the judge.
