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[2021] ZALMPPHC 33
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1st Insurance Brokers (Pty) Ltd and Another v Mudavangu and Others (7134/2017) [2021] ZALMPPHC 33 (20 July 2021)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
LIMPOPO
DIVISION, POLOKWANE
CASE
NO: 7134/2017
In
the matter between:
1
st
INSURANCE BROKERS (PTY) LTD
FIRST
APPLICANT
KERSTEL
FINANCIAL SERVICES (PTY)LTD
SECOND
APPLICANT
AND
GAYLORD
TAPIWA MUDAVANGU
FIRST
RESPONDENT
ABIGAIL
PHELADI MOKABA
SECOND
RESPONDENT
THOKOZILE
PINKIE MOHLARI
THIRD
RESPONDENT
ORACLE
FINANCIAL SERVICES
FOURTH
RESPONDENT
REGISTRAR
SHORT TERM INSURANCE
FIFTH
RESPONDENT
REVIEW
JUDGMENT-TAXATION
KGANYAGO
J
[1]
The first, second, third and fourth respondents (respondents) are
dissatisfied with the rulings of the Taxing Master relating
to the
items taxed off on applicants’ bill of costs. The respondents
have made their submissions to the Taxing Master’s
rulings in
terms of Rule 48(1) of the Uniform Rules of Court (“the
Rules”). The Taxing Master has made her stated case
in terms of
Rule 48(5)(a) and the respondents have also made their submissions in
terms of Rule 48(5)(a). The applicants have also
made their
submissions in terms of Rule 48(5). Thereafter the Taxing Master has
replied in terms of Rule 48(5)(b).
[2]
The matter has now been laid before me for a review of the Taxing
Master’s rulings. The respondents are challenging the
Taxing
Master’s rulings on allowing party and party costs plus 100% on
items 1, 3, 4, 6, 7, 8, 10, 23, 31, 32 and 33 of the
bill of cost for
Otto Krause based on the court order dated 31
st
October
2017 (attorney and own client cost award).
[3]
The respondents have submitted that the Taxing Master has erred when
making a general ruling of allowing party and party
costs plus 100%
on the items mentioned in paragraph 2 above, and has further not
applied her mind properly before allowing party
and party costs plus
100% as reasonable indemnification for the winning party, as she
refused to acknowledge and consider case
law and precedents before
making her rulings. The respondents further submitted that the Taxing
Master acted and allowed the bill
to be taxed on the wrong principles
as she taxed the bill as if the losing party was the client of the
attorney presenting the
bill despite the respondents’ argument
that the taxing of the bill of a losing party on attorney and own
client scale is
a “misnomer” as the losing party can
never be the client of the attorney presenting the bill, and
therefore the bill
should be taxed much stricter and on attorney &
client scale.
[4]
The respondents further submitted that the Taxing Master has taken an
exaggerated view of the alleged complexity of the matter
and time
necessary to consult with clients, perusal of documents and drafting
of affidavits. That this was an application based
on a restraint of
trade issue, where Part A of the application was brought before court
and heard on unopposed basis. The respondents
further submitted that
Part B of the application has never been enrolled by the applicants,
and subsequently Part B was never heard.
[5]
The Taxing Master in her stated case has stated that on 2
nd
September 2020 there were 20 bills presented before her by the
parties wherein she had made rulings. After her rulings, the parties
were able to settle other bills based on her rulings, and that the
bill of cost under review is bill no 1 with a court order dated
31
st
October 2017 which was on a scale of between attorney and own client.
That the said bill was presented by Mr Rudolf Fuls and Mr
Coetzee
(Otto Krause and correspondent attorneys De Bruin Oberholzer).
[6]
The Taxing Master submitted that Mr Rudolf has presented an agreement
wherein he had agreed with his client to charge
an hourly rate of
R3500.00. However, the Taxing Master found that the hourly rate per
the agreement was too exorbitant, and ruled
that a fair one would be
the tariff plus 100% which was double the tariff. That in principle
there is no difference between attorney
and client and attorney and
own client when taxing a bill.
[7]
With regard to the issue that the Taxing Master did not want to
listen to case law presented, the Taxing Master
has stated that she
does not make her rulings based on case law only, and that she is
having principles that she follows and the
facts of the matter
concerned. That if she were to rely on case law only she would not be
flexible in her discretion. Further that
counsel for the respondents’
likes arguing on case law, and she can even take the whole day even
when the case law is irrelevant.
[8]
The applicants in their submissions have stated that the Taxing
Master has applied her mind on ruling of a reasonable
hourly fee and
disbursements incurred in this instance. Further that the applicants
agree with the rulings made by the Taxing Master
and that they will
abide by the decision of the court.
[9]
The respondents in their reply have stated that the Taxing Master’s
discretion is wide but not unfettered.
That in exercising that
discretion, the Taxing Master must properly consider and assess all
relevant facts and circumstances. That
the discretion of the Taxing
Master was not properly exercised if such facts and circumstances are
ignored or misconstrued. That
for that reason, the Taxing Master is
required to approach the task of taxing a bill of costs with an open
mind, and this entails
considering the latest amendments to the
rules, applicable acts, the common law as well as case law and law
reports. That should
the Taxing Master fail to do so, the Taxing
Master will become a law upon his/her own. That when applying “own”
principles
unknown to others and principles that might not be
considered to be valid legal principles, when tested in a court of
law, will
result in a great injustice to all the parties concerned.
[10]
It is trite that the court of review will not interfere with a ruling
made by the Taxing Master unless it is satisfied
that the Taxing
Master was clearly wrong. (See
Ocean
Commodities Inc & Others v Standard Bank of SA LTD &
Others
[1]
)
[11]
In
President
of RSA v Gauteng Lions Rugby Union
[2]
Kriegler J
said:
“
It is settled
law that when a court reviews a taxation it is vested with the power
to exercise the wider degree of supervision identified
in the
time-honoured classification of Innes CJ in the JC1 case. This means:
‘…
that the
court must be satisfied that the Taxing Master was clearly wrong
before it will interfere with a ruling made by him…
viz
that
the court will not interfere with a
ruling made by the Taxing Master in every case where its view of the
matter in dispute differs
from that of the Taxing Master, but only
when it is satisfied that the Taxing Master’s view of the
matter differs so materially
from its own that it should be held to
vitiate his ruling.’
[12]
It is common cause that as per the order of 31
st
October 2017 costs
were awarded against the respondents jointly and severally on the
scale as between attorney and own client. In
Ben
McDonald Inc and Another
v Rudolph and
Another
[3]
Van Dijkhorst J
described the terminology used for categories of costs as follows:
“
1. Party and party
costs: These are costs awarded against the losing party in litigation
and are taxed in terms of Rule 70 with
a view to a full indemnity to
the successful party but limited to costs necessary or proper for the
conduct of the litigation…
2. Attorney and client
costs:
2.1 In cases where the
losing party in litigation is to pay them, this means the same as
attorney and own client costs as defined
below.
2.2 In cases where the
losing party in litigation is to pay them to the successful party
this means all reasonable costs incurred
on behalf of the client
although not strictly necessary or ‘proper”. In practice
this means that these costs are taxed
according to tariff, but
generous where there is some leeway. Items not in the tariff may be
included and so may amounts which
would be reduced on taxation on
party and party basis. The limited scope of this taxation follows
from the fact that Rule 70 also
governs taxation between attorney and
client.
2.3 Attorney and own
client costs, whether in the sense of 2.1 above or where they are to
be paid by the losing party to the successful
party, means all costs
incurred except where unreasonable. Agreed items or amounts are
presumed to be reasonable… This presumption
of reasonableness
cannot be irrebuttable as this would open the door to clients
agreeing to exorbitant fees with attorneys or counsel
in the
knowledge that the opponent will foot the bill. This will be
contra
bonos mores
. My approach that in an attorney and own client bills
which have to be paid by the other party the attorney should not be
given
a free hand, untrammeled by the frown of the Taxing Master, is
in conformity with the approach of the Appellate Division in Nel
v
Waterberg Landbouwers Ko-operatiewe Vereeniging 19
46 AD 597
at 608.
The appellate Division in placing its stamp of approval on orders for
attorney and client costs still insisted on a stricter
approach on
taxation where the bill is taxed against the losing party as ‘it
is essential…to prevent injustice to
the latter’.
Admittedly the term ‘attorney and own client costs’ was
not used, but the principle is the same.
A court may castigate a
party in an award of costs but will not countenance unjust
treatment.”
[13]
In taxing an attorney and own client bill, the Taxing Master has a
discretion to allow all such fees and expenses that
appears to be
reasonable for the proper attainment of justice or for defending the
rights of any party. Usually when a client instructs
an attorney,
they will have an agreement in relation to the fees payable to the
attorney. In the agreement they will normally agree
on an hourly rate
or globular amount. The successful party will rely on that agreement
in preparing his/her attorney and own client
bill. However, even
where there is a written agreement between attorney and client, as to
work to be done or fees to be charged,
the Taxing Master is still
empowered to enquire into the reasonableness of such a fee in the
agreement. An agreement for fees exceeding
the tariff rates does not
bind the Taxing Master or the losing party. The Taxing Master whilst
not necessarily bound by the tariff
in the written agreement, will
tax the bill on the basis of remuneration that is reasonable in all
the circumstances. (See
Ben
McDonald Inc and Another above, and Aircraft Completions Centre (Pty)
Ltd v Rossouw and Others
[4]
)
[14]
The Taxing Master in her stated case has stated that Mr Rudolf
presented an agreement wherein the hourly rate was R3500.00.
However,
the Taxing Master made a ruling that the hourly rate as per the
agreement was too exorbitant, and decided that it will
be fair to
allow the hourly rate as per the tariff plus 100% which was double
the tariff. According to the Taxing Master in her
stated case, items
1, 3, 6, 7, 8, 10, 23, 31, 32 and 33 were reduced to the double
tariff as the applicants’ bill was drafted
in accordance with
the written agreement of the hourly rate of R3500.00.
[15]
Even though the Taxing Master was obliged to have regard to the terms
of the agreement, she was alive to the fact that
she was not
necessarily bound by the tariff in the written agreement, but was
entitled to determine whether it had exceeded the
bounds of
reasonableness. This she did by ruling that the tariff as per the
written agreement was exorbitant, and that the fair
tariff to be
applied under the circumstances was the normal tariff as per the
Rules plus 100% which amounted to double the tariff.
By applying that
formula, she was preventing injustice to the respondents. Her ruling
has in fact benefited the respondents as
the bill was taxed on a
lesser scale than the hourly rate in the written agreement. She
cannot be faulted for her conclusion. This
court does not find any
reasons to interfere with her rulings as they were not wrong. It
follows that the respondents’ review
application stands to
fail.
[16]
In the result I make the following order
16.1 The respondents’
review application is dismissed.
16.2 No order as to
the costs.
MF
KGANYAGO
JUDGE
OF
THE HIGH COURT OF SOUTH AFRICA
LIMPOPO
DIVISION, POLOKWANE
FOR
PARTIES
1. For the
Applicants
:
Otto Krause Inc
2. For the
1
st
to 4
th
Respondents :
Bosman Attorneys
3. Date of
Judgment
:
20
th
July 2021
[1]
1984
(3) SA 15 (A)
[2]
2002
(2) SA 64
(CC) at 73C-D
[3]
1997
(4) SA 252
(T) at 257G-258E
[4]
2004
(1) SA 123
(W) at para 12