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[2021] ZAFSHC 4
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Van Pletzen v Taxing Master of the High Court and Other (4992/2014) [2021] ZAFSHC 4 (15 January 2021)
IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE DIVISION, BLOEMFONTEIN
Case
number: 4992/2014
In
the matter between:
WH
VAN PLETZEN
Applicant
and
TAXING
MASTER OF THE HIGH COURT
1
st
Respondent
ROAD
ACCIDENT FUND
Defendant
FREE
STATE SOCIETY OF ADVOCATES
Amicus Curiae
JUDGMENT
BY
:
MHLAMBI J,
DELIEVERY ON:
15
JANUARY 2021
REVIEW OF
TAXATION
MHLAMBI,
J
[1]
This is a review of taxation as contemplated in Rule 49 (1) of the
Uniform Rules of Court.
The applicant was dissatisfied with the
ruling of the taxing master for having disallowed certain items on
the taxed bill of costs.
On 28 May 2019, a notice of review was filed
requiring the taxing master to file a stated case in terms of Rule 48
(3) of the Uniform
Rules of Court.
[2]
The taxing master duly filed a stated case on 25 June 2019 and the
respondents filed written
submissions in terms of Rule 48 (4) (a) on
16 July 2019. The Free State Bar made known its wish to be joined in
the review proceedings
and, on 25 September 2019, notified that all
the parties had consented to its joinder in the proceedings. It filed
its request
to be joined as well as its submissions on 27 January
2020. The taxing master’s report in terms of Rule 48 (5) (b)
was filed
on 22 May 2020. No further submissions were made by the
parties.
[3]
The items which were the cause of the dissatisfaction were set out as
follows in the review
notice:
“
1.
Item 167 where the taxing master disallowed one third of counsel’s
trial
fee for 17 May 2017 despite counsel’s fees been
reasonable and in accordance with the current practise, fees
structure and/or
guidelines of the Free State Society of Advocates,
which allows counsel to charge a standard day fee and charge
separately for
preparation.
2.
Item 277 where the taxing master disallowed one third of counsel’s
trial fee for 29 August 2018, 31 August 2018 and 17 September 2018
despite counsel’s fees been reasonable and in accordance
with
the current practise, fee structure and/or guidelines of the Free
State Society of Advocates, which allows counsel to charge
a standard
day fee and charge separately for preparation.
3.
Item 277 where the taxing master disallowed an amount of R 6 700.00
for
“perusal of documents, drafting notice of intention to
amend (4.35 hours)” despite counsel’s fees being
reasonable,
being marked on the basis of actual time spent and not
being excessive having regard to the complexity of the matter and the
various
medical experts involved.
4.
Item 277 where the taxing master disallowed an amount of R 5 100.00
for
“drafting heads of argument (8.75 hours)”
despite counsel’s fees being reasonable, being marked on
the
basis of actual time spent and not being excessive having regard to
the complexity of the matter and the various medical experts
involved.”
[4]
In his stated case, the taxing master averred that on the date of the
taxation, items 167
and 277 (counsel’s invoice) were objected
to by Ms Letswalo based on their being excessive. In determining the
reasonableness
of the fees charged, he disallowed two thirds of the
counsel’s fee regarding items 167 and 277 and not one third as
indicated
on the plaintiff’s notice of review dated 27 May
2019. His decision was informed by the case law, legal literature and
the
purpose of taxation as contained in Rule 70 (3) of High Court
Rules to ensure that the parties were treated fairly when an order
of
costs was made. In his determination of the reasonableness of the
counsel’s fee, he took into consideration the seniority
of the
counsel, the hourly tariff charged by the counsel at the time the
work was done, the actual time spent for doing the work
e.g. the
number of pages perused, drafted, settled, preparation and
reasonable time of consultation etc. as well as the nature
and
complexity of the matter
[1]
.
[5]
The calculations of the amounts taxed off on the counsel’s tax
invoice are outlined
as follows in the taxing master’s stated
case:
“
vi)
Appearance on 17/05/2017 during second day of merit trial, when merit
trial was concluded and
judgment reserved @ R 18 500.00 for 10
hours plus VAT of 14% = R 21 090.00, which I ruled during taxation
that the two thirds of
the first day fee should be disallowed. The
two thirds was calculated as follows:
R
21 090 (including VAT) x 2= R 42 180.00
R
42 180/3= R 14 060.00
R
21 090.00 subtract R 14 060.00= R 7 030.00.
R
7 030.00 plus 14%= R 8 014.20, total disallowed and taxed off in
terms of the two- thirds principle.
Consequently,
counsel was allowed an amount of R 13 075.80 as a refresher fee. I
consider the above fee reasonable taking into account
the nature, the
complexity and the actual time spent by counsel on the matter.
viii)
Trial fee for handling of matter on 29/08/2018 for 10 hours @ R 2
000.00 per hour= R 20 000.00,
which I disallowed due to two thirds
principle.
The
two- third was calculated as follows:
R
20 000.00 multiply by 2 = R 40 000.00
R
40 000.00/3= R 13 333.33
R
20 000.00 subtract R 13 333.33= R 6 666.67.
R
6 666.67, disallowed and taxed off in terms of the two thirds
principle.
ix)
Trial fee for handling of matter on 31/08/2018 for 10 hours @ R 2
000.00= R 20 000.00, which I
disallowed due to two- thirds principle.
The two-third was calculated as follows:
R
20 000.00 multiply by 2 = R 40 000.00
R
40 000.00/ 3 = R 13 333.33
R
20 000.00 – R 13 333.33 = R 6 666.67
R
6 666.67, disallowed and taxed off in terms of the two- thirds
principle.
x)
Trial fee for handling of matter on 17/09/2018 for 10 hours@ R 2
000.00 = R 20 000.00, which I disallowed due
to two- thirds
principle. The two-third was calculated as follows:
R20
000.00 multiply by 2=R40 000.00
R40
000.00/3= R 13333.33
R
20 000.00 subtract R 13333.33=R 6 666.67
R
6 666.67, Disallowed and taxed off in terms of the two-thirds
principle.
iv)
Perusal of documents, drafting notice of intention to amend on the
20/06/2018- 02/07/2018 for 4.35 hours @ R 2 000.00
per hour= R 8
700.00, which I disallowed an amount of R 6 700.00 and allowed
perusal of 3 pages at 30 pages per hour=1 hour. The
amount of R 2
000.00 was therefore allowed. A fee for drafting notice of intention
to amend was disallowed as it was already charged
for by the attorney
in terms of item 211 of the bill of cost.
xi)
Drafting heads of argument on the 21/09/2018 for 8.75 hours @ R 2
000.00= R 17 500.00, which I disallowed an amount
of R 5 100.00 and
allowed drafting of 31 pages @ 4 pages per hour=6.2 hours. Thus, 6.2
hours multiply by R 2 000.00 per hour= R
12 400.00 was allowed for
drafting of heads of argument.”
[6]
The applicant submitted that the trial fees of counsel were
reasonable and in accordance
with the current practice, fee structure
and/or guidelines of the Free State Society of Advocates, which
allowed counsel to charge
a standard fee and charge separately for
preparation and other work. The portion of counsel’s fees in
both items 167 and
277 for the dates 17 May 2017, 29 August 2018, 31
August 2018, and 17 September 2018 should not have been disallowed.
The total
time spent on perusal of documents, the drafting of a
memorandum and the drafting of the intention to amend consisted of
12.85
hours. The total number of pages perused by counsel was a
minimum of 650 pages which would have taken 21.67 hours to peruse at
30 pages per hour.
[8]
Relying on
Trollip
v The Taxing Mistress of the High Court and three others
[2]
,
the applicant submitted that counsel was entitled to be fairly
compensated as a professional for his preparation, attendance at
Court, presentation of argument and all the thought, concern and
responsibility that went into the matter. In the absence of evidence
to the contrary, a taxing mater’s starting point should be that
advocates, as members of an honourable profession, render
fees
honestly and behave ethically. It takes time to refine and streamline
heads of argument. The number of pages containing heads
of argument
may not reflect the time spent on their drafting as counsel has to be
brief but comprehensive and avoid lengthy and
verbose heads of
argument. Counsel’s fees should have been allowed in full for
the perusal of the documents.
[9]
The Society of Advocates joined, firstly, as its members had a direct
interest in
the applicant’s objections to the rulings made by,
and fees disallowed by the taxing master. Secondly, the criteria used
by the taxing master to decide upon the advocates’ reasonable
remuneration in the given circumstances were, in the society’s
opinion, irrational and based on outdated taxing principles.
[10]
The Society submitted that the taxing master was satisfied that the
counsel’s hourly fees
in the amount of R 1 850.00 should be
allowed. Similarly, the day fee(court day) in the amount of R 18
500.00,
[3]
was considered as fair
and reasonable by the taxing master and was allowed for counsel’s
appearance on 16 May 2017 which was
the first day of the trial.
Although the base fee is, in terms of the society’s
recommendations, the “hourly”
fee, a day fee could not be
calculated on the hours spent in court under normal circumstances.
The normal hours of the court were
in total 5,15 minutes per day. The
counsel was briefed to represent the plaintiff in court on 17 May
2017 and was therefore entitled
to a day fee which was the hourly fee
of R 1 850.00 multiplied by 10. As he was briefed and reserved to
appear on behalf of the
plaintiff on that day, he was not allowed to
accept a brief for another appearance in court or conduct
consultations in chambers
on that day even if he anticipated that the
matter would be postponed or settled. If he had done so, his conduct
would have been
regarded as unprofessional conduct which was
punishable.
[11]
It was submitted that the calculation of the fees allowed by the
taxing master was for the most
part incomprehensible. He did not
disclose what the “actual time spent” by counsel on the
matter was or what the significance
of the “time spent”
was, taking into consideration that counsel claimed payment of his
day fee which was R 18 500.00
(excluding VAT). The Society assumed
that the taxing master believed that the day fee claimed for the
appearance on 17 May 2017
was based on 10 hours. The allowance of the
one third of counsel’s first day fee was never the principle on
which a refresher
fee was calculated. The calculations concerning
item 167 were erroneous as the amount of R 13 075.80 allowed by the
taxing master
as a refresher did not tally with a refresher fee of
one- third or even two- thirds of the counsel’s day fee.
[12]
The principle of the two-thirds rule was outdated and had not been
applied consistently by advocates
in any division of the high court.
The “first day trial fee” was not charged by counsel in
this division of the high
court for the past 20 years. Counsel
charged per hour for preparation for trial, for consultation, advise
on evidence, heads of
argument and the like. The fees charged for
days spent in court are considered as a “day fee” whether
the matter proceeded
to trial or only argued or is postponed or
settled. The society supported the applicant’s written
submissions to the taxing
master’s stated case and the relief
claimed.
[13]
In his report in terms of section 48(5)(b) of the Rules, the master
maintained that during taxation,
two-thirds of the counsel’s
fee was disallowed in respect of items 167 and 277 of the plaintiff’s
bill of costs and
not one-third as indicated in the plaintiff’s
notice of review. This statement is not supported by the
calculations. The
calculations themselves are fraught with mistakes
as shown below.
[14]
Items 167 (
vi)
and 277 (viii), (ix) and (x) which related to
the alleged two-thirds to be disallowed in terms of that principle,
showed clearly
that, instead of two-thirds, only one-third was
disallowed and subtracted. The day fee was multiplied by 2 ( probably
in an endeavour
to give effect to the alleged two-thirds principle)
and the total divided by 3 which resulted in the one-third of the
bigger total
but in essence a two-thirds of the day fee. Once this
amount is deducted from the day fee, the amount disallowed is but a
third
of the day fee. It behoves to mention that in item 167(vi), the
14% VAT was deducted twice as the amount of R21 090.00 was inclusive
of VAT.
[15]
In item 277(xi), 6.2 hours (or 31 pages @ 4 pages per hour) were
allowed for the drafting of the heads
of argument @ R2000.00 per
hour, giving a total of R12 400.00 The correct calculation on these
figures
appears to be 7.75 hours which would give a total amount of R15
500.00.
[16]
Rule 70 (3) of the Uniform Rules of court provides as follows:
“
With
a view to affording the party who has been awarded an order for costs
a full indemnity for all costs reasonably incurred by
him in relation
to his claim or defence and to ensure that all such costs shall be
borne by the party against whom such order has
been awarded, the
taxing master shall, on every taxation, allow all such costs, charges
and expenses as appear to him to have been
necessary or proper for
the attainment of justice or for defending the rights of any party,
but save as against the party who incurred
the same, no costs shall
be allowed which appear to the taxing master to have been incurred or
increased through over-caution,
negligence or mistake, or by payment
of a special fee to an advocate, or special charges and expenses to
witnesses or to other
persons or by other unusual expenses.”
The
successful party must be given a full indemnity in respect of all
costs reasonably incurred.
[4]
[17]
In
General
Council of the Bar of South Africa v Geach and Others
[5]
,
it
was stated that in current practice, many
advocates
charge separately for their preparation, a first day fee on
trial should not be markedly different from the refresher
because
they are compensating for the same work- the day in court. I find the
following passage from
City
of Cape Town v Arun Property Development (Pty) Ltd and another
[6]
appropriate:
“
[30]
To reiterate, in matters of this nature I would expect the taxing
master in considering the question of counsel’s fees
to adopt
an approach along the following lines:
1.
Consider the nature and
complexity of the mater: What did the matter involve? How voluminous
were the papers? Were there difficult
areas of law involved or was
the claim of particular importance to the parties by virtue, for
example, of the amount of money involved?
Did it involve an unusual
amount of time spent in court?
2.
Consider the work done by
counsel: How difficult or complex were the matters dealt with in the
heads of argument? How long did counsel
spend drafting heads of
argument? How long did counsel spend considering the opponent’s
heads of argument and authorities?
How long did counsel spend
preparing his or her oral address to court?
3.
Consider counsel’s fee: Do
they fall within the parameters familiar to the taxing master? Is it
clear what is being charged
for? Are all the charges covered by the
costs award made?
4.
Consider what is reasonable: In
this regard the consideration that the litigant must not be out of
pocket in respect of party and
party fees charged by counsel must be
taken into account together with the recognition that a reasonable
rate coupled with reasonable
time spent may not always, but certain
can, amount to a reasonable basis for the taxation of counsel’s
fees. If the taxing
master is of the opinion that the time taken by
counsel to perform a given task is reasonable on a party and party
basis and the
rate at which he or she charged is reasonable, then the
litigant should be entitled to an indemnity in respect of such
charges.
5.
Consider the totality of the fee
for the matter: If the fee charged for the work done prior to the
hearing is reasonable and the
work done qualifies as party and party
attendances, then the fee for such attendances should be added to the
fee for the “refresher
fee” charged. By way of example,
if in this matter the taxing master determines that it was reasonable
to spend 5 hours drafting
or settling heads of argument, 5 hours
reading and considering the respondent’s heads of argument and
authorities and 5 hours
preparing for the oral argument, she would
allow a fee on exception of the equivalent of 2 days and 15 hours. If
she felt an excessive
amount of time was spent on items of
preparation, she should disallow a fee for such excessive time.”
[18]
The
Taxing master must strike a moderating balance which affords an
innocent party adequate indemnification within reasonable bounds.
This equitable balance should be struck correctly in the light of all
the circumstances.
[7]
The court
will not interfere with a ruling made by the Taxing Master merely
because its view differs from his or hers, but only
when it is
satisfied that the Taxing Master’s view differs so materially
from its own that it should be held to vitiate the
ruling.
[8]
Charges
that are time-related are not decisive and an objective assessment of
the features of the case is primary to determine the
reasonableness
of the fee for that work, to obviate the charging of exorbitant fees
for slow and inefficient work.
[9]
[19]
The Taxing Master may not ignore evidence that may
show that work that has been charged for has not been
done, but that
does not mean that there is a duty on practitioners to prove
their claims. The taxing officer is entitled
to take the counsel’s
fee list at face value as constituting a record of the work that has
been done. The honesty and professional
ethics of counsel ought not
to be lightly questioned.
[10]
[20]
In this case, the Taxing Master failed to present
facts which would be supported by the legal authorities
cited. Apart
from the calculations which have been shown to be erroneous, there
are no allegations of any untoward conduct by either
attorney or
counsel that the taxing master could impute to both legal
representatives that could create the impression that counsel
did not
do the actual work as recorded. Neither is there any indication that
counsel did not carry out his brief in a proper manner,
disqualifying
him to his full fees. In the absence of any suggestion to that
effect, there is no justification why counsel should
not get his full
fees for work done including the drafting of the documents. The
taxing master failed to adduce facts to show that
he properly
exercised his discretion in this matter. It must be said that this
was not due to any deliberate act on his part but
due to the lack of
authoritative guidelines on this matter.
[11]
[21]
In the result, I am of the view that the Taxing
Master erred and was clearly wrong in disallowing the amounts
as per
items 167 and 277 of the allocator. I am therefore satisfied that his
ruling should be interfered with.
ORDER
I
make the following order:
1. The
review of taxation succeeds.
2. The
taxation by the taxing master as reflected in his allocatur
regarding items 167 and
277 is set aside.
3.
In its stead, the taxing master is directed to reinstate counsel’s
full fees for work done as set out in items
167 and 277 presented by
Bezuidenhouts Inc. Attorneys.
4.
There is no order as to costs.
JJ MHLAMBI, J
Attorneys:
Bezuidenhouts
INC
104
Kellner Street
Westdene
Bloemfontein
Attorneys:
Maduba
Attorney
77
Kellner Street
Westdene
Bloemfontein
[1]
Paragraphs
6 and 10 of the Taxing Master’s stated case Notice
[2]
Case
number 6091/2018 ECD (Grahamstown) which was delivered on 31 July
2018.
[3]
Being
the “base fee” multiplied by 10 as recommended by the
Society to its members.
[4]
Kloot
v Interplan Inc and Another
1994 (3) SA 236
SECLD at 239 H.
[5]
2013
(2) SA 52 (SCA)
[6]
2009
(5) SA 227 (C)
[7]
President of the Republic of South Africa and Others v
Gauteng
Lions Rugby Union and Another
2002 (2) SA 64
(CC) (220)
(1)BCLR;
[2002] ZACC 5)
as quoted in Hennie de Beer Game LodgeCC v
Waterbok Bosveld Plaas CC and Another
2010 (5) SA 124
(CC)
para 7.
[8]
Gauteng
Lions, supra, in para 45.
[9]
Hennie
de Beer Game Lodge, supra, in para 9.
[10]
Trollip,
supra.
[11]
Pieterse
N.O. and Another v Botha and Others (4591/2014)
[2015] ZAFSHC 255
(17 September 2015); See also para 12 of the Taxing Master’s
stated case.