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[2016] ZAFSHC 134
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Razzmatazz Civil (Pty) Ltd v Dihlabeng Local Municipality and Another (A76/2015) [2016] ZAFSHC 134 (7 July 2016)
IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE DIVISION, BLOEMFONTEIN
Application
number: A76/2015
In
the matter between:
RAZZMATAZZ
CIVIL (PTY)
LTD
........................................................................................
Applicant
And
DIHLABENG
LOCAL
MUNCIPALITY
.....................................................................
1
ST
Respondent
LELE
AND TSHIDI CONSTRUCTION
AND
............................................................
2
ND
Respondent
PLANT
HIRE CC
JUDGMENT
BY: MHLAMBI, AJ
DELIVERED
ON: 7 JULY 2016
REVIEW
OF TAXATION
INTRODUCTION
[1]
This is a review of taxation as contemplated in Rule 48(1) of the
Uniform Rules of Court. Dissatisfied with the taxing
master for
having disallowed certain fees on their taxed bill of costs, first
respondent requested the taxing master to file a
stated case in terms
of Rule 48(3).
[2]
The taxing master duly filed a stated case and the respondents filed
written submissions in terms of Rule 48(5) (a). On
2 June 2016
I caused a letter to be addressed to the taxing master to comply with
Rule 48(5) (b) to supply a report as I was of
the view that the
matter was prematurely referred to the judge in chambers. On 3 June
2016 I received the file with a note on the
file cover to the effect
that the attorneys have no intention of filing further documents on
the review application.
[3]
The items which were objected to on the correspondent attorneys’
bill of costs are as follows:
“
Item
12 Nalees dokumentasie aangeheg tot correspondent se skrywe van
08.10 (97bls) R 5141.00
Item
48 Betaal Adv van der WaltR 77,805.00”
The
items which were objected to on the instructing attorneys’ bill
of costs are as follows:
“
Item
6 Nalees dokumentasie ontvang vanaf 1
st
respondent (97bls)
R 5141.00”
[4] The counsel’s
account dated 2 November 2015 reflected that the following services
were rendered:
“
22/9/15:
To peruse documents [07h30-08h15] R 1125.00
To
consult Mr Jacobs and Mr Botha
[14h15-17h00]
R 5500.00
29/9/15:
To peruse documents and prepare first draft opposing affidavit
[18h00-19h30] R 2250.00
30/9/15:
To peruse documents and to prepare first draft opposing affidavit
[08h00-10h00] R 3000.00
6/10/15:
To peruse documents and to prepare first draft opposing affidavit
[08h00-10h00];[15h30-16h30]
R
4500.00 5/10/2015 To peruse documents and to prepare first draft
opposing affidavit [14h00-15h45];[18h00-19h00] R 4125.00
11/10/15:
To consider replying affidavit [11h00-11h30] R
750.00
21/10/15:
To peruse documents and to finalise opposing Affidavit [09h00-11
h00] R 3000.00
To
prepare condonation application and Supporting affidavit[13h00-15h00]
R 3000.00
23/10/15:
To prepare first respondent’s heads of argument [09h30-13h00,
[13h30-14h0 0] R 6000.00
1/11/15
To peruse court record, to consider applicant’s Heads of
argument, to consider second respondent’s Heads of
argument and
to prepare for argument [9h00-13h00]; [14h00-18h00];[20h00-22h00]
R
15000.00 2/11/15 To argue opposed matter
R 20000.00
R
68250.00
14%
BTW
R 9555.00
R
77805.00
BACKGROUND
[5]
The taxation arose from an order made by the court in a successful
review application. The second respondent was ordered
to pay
the costs of the application inclusive of the costs of the interdict
application.
[6]
It was stated in the judgment that the facts of the case were largely
common cause. The first respondent, even though it filed
a notice of
opposition dated 20 May 2015, never opposed the main application for
the setting aside of its decision to award a tender
to the second
respondent. It initially opposed the costs order sought by the
applicant against it. Having reached an agreement
that no such costs
order would be sought as against it, the first respondent filed a
notice of withdrawal of its opposition on
10 July 2015. The first
respondent’s attorneys enquired about the notice of set-down of
the application and it was furnished
to them on 25 August 2015.
[7]
The second respondent launched a conditional counter application in
which it sought an order for costs jointly and severally
against the
applicant and the first respondent. The conditional counter
application was served on the first respondent’s
Bloemfontein
attorneys on 8 September 2015, calling upon the first respondent to
provide reasons as required by law within 10 (ten)
days after the
service of the counter application. Both the applicant and the first
respondent opposed the order sought by the
second respondent for the
payment of the costs in its counter application. On 26 October 2015,
the first respondent filed an application
for the condonation of the
late delivery of its opposing papers, heads of argument and the
non-compliance with the time limits
provided in section 7(1) of PAJA
in regard to the second respondent’s counter application. It
was granted in the absence
of any opposition.
[8] The application
was heard on 2 November 2015 and judgment granted on 19 November
2015.
GROUNDS
FOR OBJECTION TO THE COUNSEL’S REDUCED ACCOUNT (Item 48)
[9] 1. The taxing
master did not take into account the nature and complexity of the
application;
2.
The taxing master did not properly take into account the counsel’s
specified account and the items which indicated the
time spent on
drafting and perusal.
3.
It is not clear how the taxing master computed the composite fees she
allowed.
GROUNDS
FOR OBJECTION TO THE ATTORNEYS’ TAXED OFF ACCOUNTS (Items
6 and 12)
[10]
It was contended that the taxing master erred in allowing the perusal
of the documents of both the instructing and correspondent
attorneys
at half the tariff.
THE MASTER’S
STATED CASE
[11]
The taxing master stated that, on her request, the attorneys
representing the parties provided her with a summary of the facts
of
the case as follows: “i) the bill of costs is for a counter
application within a main application. ii) Argument of the
main
application and the counter application took place on the same day.
iii) The applicant was represented by the same advocate
in both the
main application and the counter application. iv) One judgment was
handed down but it included two separate orders,
one with respect to
the main application and one in respect of the counter application
(taxation on this day is for the latter).
v) The second respondent
instituted the counter application.”
[12]
As regards items 6 and 12, the taxing master contended that the
counter application was concerned with the argument of costs
and
consequently, no additional information was required for such
argument as the attorney was already provided with the necessary
information in the main action. In her view, a re-perusal fee was
necessary in order to set up a defence to the second respondent’s
counter application. A fair and reasonable amount would, in terms of
Rule 70, include the receipt, entry, considering and filing
per page
at a fee of R53.00. The documents complained of should have been
received and considered at full tariff in the main application.
[13]
To allow a full tariff would be a duplication of work. No folio’s
were taxed off and it would therefore be fair to allow
half the
tariff to compensate for any new documents received. Furthermore, the
documents were provided to counsel to determine
which should be
attached to the first respondent’s affidavit. She stated
further that “My view is that to allow a full
consideration fee
to the attorneys would be unreasonable where the determination of
importance of the document fell on a third
person (who also got a fee
here fore)”. I presume that the last sentence referred to
counsel.
[14]
The taxing master stated that she had noted that the counsel
determined his fees according to hours spent on the matter.
According to her, this method of calculation was not preferred by the
courts, but the first day fee method. In terms of the fee
system
(actual hours system), the counsel’s work on the second
application alone would amount to 20 hours. She allowed
a full
day fee in the amount of R20 000.00 (twenty thousand rands), R10
000.00 (ten thousand rands) for preparation considering
that the
application stemmed from the first application which was heard on the
same day. A further R10 000.00 (ten thousand rands)
was allowed for
drafting and the complexity of the matter.
SUBMISSIONS
[15]
1. The first respondent contended that the taxing master erred in
determining that it had received compensation for the perusal
of the
documents and that items 6 and 12 could be a duplication of previous
items.
2.
It contended further that it had transpired during the consultation
of 22 September 2015 that the first respondent had documents
in its
possession which consisted of correspondence between the applicant
and the respondents relating to the matter, tender documents
and
agreements which were only received by the instructing attorney
on 8 October 2015 for onward transmission to its correspondents.
The
documentation consisted of 97 pages which were necessary for the
finalization of the first respondent’s opposing affidavit.
No
other items other than items 6 and 12 were received by the attorneys
from the first respondent for perusal.
3.
The taxing master erred in allowing a composite fee and did not
consider the actual time spent by counsel. The court order, in
terms
of which the accounts were taxed, included all costs in respect of
the main and the counter applications.
4.
The account rendered by counsel related to all work in respect of the
main and counter applications which were heard on the same
day. The
taxing master allowed a composite fee of R10 000.00 (ten thousand
rands) whereas counsel charged fees for 14 hours in
the amount of
R21000.00 (twenty-one thousand rands) in respect of the two items on
the counsel’s tax invoice dated 2 November
2015 relating to the
dates of 23/10/2015 and 01/11/2015.
5.
The taxing master failed to consider the extent and the nature of the
matter as well as the volume of the documents. She should
have
allowed an additional 4hours and 40 minutes for drafting 24 pages,
2hours and 45 minutes for the consultation and 6 hours
for the
perusal of 600 pages of the entire application.
6.
The taxing master was of the view that the counsel drafted 12 pages
and that he was not entitled to a fee for settling his own
drafting.
(I could not find an item which indicated that the counsel had
settled his own drafting). It was reasonable for
the counsel to
draft between 4-5 pages per hour and to allow 20-30 pages per hour
for perusal. She opined that the amount provided
and allowed by
herself “was perhaps too much in the given circumstances”.
ISSUES
[16] The
issues to be determined are whether the taxing master erred in:
1.
restricting the taxation of the bills of costs to the conditional
counter application alone and not extending it to the
main
application;
2.
reducing the counsel’s fees;
3.
allowing the perusal of 97 pages by the attorneys at half the tariff.
ASPECTS THAT
ARE COMMON CAUSE
[17]
The parties are agreed as to the method of calculation relating to
the drafting and the perusal of documents, the taxing off
of the vat
and the amount of the appearance in court.
THE APPLICABLE
LEGAL PRINCIPLES
[18]
In
City of Cape Town v Arun Property Development (Pty) Ltd and
Another
2009(5) SA 227 (C) at paragraph 25, the court
suggested that the taxing master ought to approach the taxation of
the bill of costs
on the following lines:
a)
The complexity of the issues raised, the nature of the matter, the
issues in dispute and the volume of the record;
b)
The work actually done by counsel and the rate at which he charged;
c)
The reasonableness of the counsel’s fees;
d)
Consider counsel’s fees as to what is being charged for and
whether all charges were covered by the costs award made;
e)
Consider the totality of the fee. If the fee is reasonable and the
work done qualifies for party and party attendances, then
it should
be added to the fee for the ‘refresher fee’ charged. If
the taxing master feels that an excessive amount
of time was spent on
items of preparation, she should disallow a fee for such excessive
time.
[19]
The composite first day fee charged by counsel includes preparation
for argument presented in court and the drafting of heads
of
argument. The counsel gets one fee for perusing, preparing, drawing
heads of argument
and appearing in court
;
Ndzamela v
Eastern Cape Development Corporation Ltd and Another
2004 (6)
SA 378
(Tkh);
JD van Niekerk en Genote Ing v Administrateur,
Transvaa
l
1994 (1) SA 595
(A); Price Waterhouse Meyernel v
Thoroughbred Breeders’ Association of South Africa 2003(3) SA
54 (SCA). In Arun,
supra
, the court held that it was correct
to take preparation and a refresher or day fee together for the
purpose of assessing the reasonableness
of counsel’s fee.
[20]
In
Hennie De Beer Game Lodge CC v Waterbok Bosveld Plaas CC and
Another
2010 (5) SA 124
(CC) at paragraph 9, the court stated
“….The Supreme Court of Appeal has taken note of the
almost invariable practice
throughout the country nowadays for legal
practitioners to make their charges time-related. The principle
flowing from this is
that time charged is not decisive. An objective
assessment of the features of the case is primary, and time actually
spent in preparing
an appeal cannot be decisive in determining the
reasonableness, between party and party, of a fee for that work. The
reason is
that time alone would put a premium on slow and inefficient
work and would conduce to the charging of fees wholly out of
proportion
to the value of the services rendered”. The taxation
should afford reasonable remuneration for work necessarily and
properly
done for the attainment of justice:
President of the
Republic of South Africa and Others v Gauteng Lions Rugby Union and
Another
2002 (2) SA 64
(CC) at paragraph 45.
APPLICATION
OF THE LEGAL PRINCIPLES
[21]
The first question that arises is whether the first respondent is
correct to maintain that the court order, in terms of which
the
accounts were taxed, included all costs for work done in both the
main and counter applications and entitling it to such taxed
costs.
On perusal of the bills of costs and the counsel’s tax invoice,
it is evident that the costs sought to be taxed, refer
to the period
commencing on 9 September 2015 until 2 November 2015. The said
documents refer to the period after 8 September 2015
when the
conditional counter application was served on the first respondent.
The services rendered or the work done as itemized
in the bills of
costs, referred to the resistance of the costs order contained in
clause 4 of the conditional counter application.
I am therefore in
agreement with the taxing master that the bills of costs referred to
the counter application and not the main
application.
I
shall first deal with item 48 under the two headings as set out in
the first respondent’s Rule 48(5)(a) submissions:
1.
Consultation,
drafting and the perusal of all documents
A
perusal of the counsel’s tax invoice indicates that 11hours and
fifteen minutes were spent on the item “To peruse
documents and
to prepare first draft opposing affidavit”. The amount charged
was R13 875.00 (thirteen thousand, eight hundred
and seventy-five
rands). These hours exclude those spent on 22/09/2015 (45 minutes)
for perusing documents and 21/10/2015 for “To
peruse documents
and to finalise opposing affidavit”. Consequently, 14 hours
were spent to peruse and finalise the opposing
affidavit to resist a
costs order in the conditional counter application. The fees charged
seem expensive:See
JD VAN NIEKERK, supra.
It
is noteworthy that item 7 on the correspondent’s account and
item 8 on the instructing attorney’s account, titled
“nalees
deels voltooide konsep opponerende verklaring deur adv voorberei(12
bls) was fully taxed off by the taxing master.
No objection was
registered in this regard. One would have expected an objection
taking into account first respondent’s argument
on the papers.
I must hasten to say that the taxing master did allow item 28 and 18
of both attorneys’ accounts in respect
of the perusal of the
first respondent’s complete affidavit opposing the costs order
drafted by the counsel and consisting
of 12 pages.
An
additional fee of R12000.00 (twelve thousand rands), it is argued,
should have been allowed for the perusal of 600 pages received
for
the entire application. This approach is untenable as the bills of
costs refer specifically to the conditional counter application.
Moreover, nowhere in the accounts presented was there mention made of
600 pages for perusal.. In paragraph 5.1 of the submissions,
it is
contended that according to the counsel’s account, he charged 6
hours for the perusal of the documents. I could not
detect such an
item on the account save those I have already indicated above. The
taxing master was justified in not entertaining
such a claim, if ever
she did. In paragraph 5.3, it was argued that the counsel was
entitled to a fee for having drafted an affidavit
consisting of 12
pages in the main application and another 12 pages in the counter
application; altogether 24 pages. I agree with
the taxing master that
only 12 pages and 2 hours and 20minutes should be allowed for
drafting as they are related to the counter
application.
2.
Preparation,
perusing and drafting heads of argument
The
first respondent’s heads of argument consist of 8 pages and two
authorities were cited. The heads are very specific to
the costs
order raised in the conditional counter application. The rest of the
heads are a rehearsal of the issues in the
application. The
only issue that the first respondent was saddled with at all times
was the question of costs. Unlike the second
respondent, he did not
argue the main application but the resistance of the prayer of costs
in the counter application. Counsel
was already acquainted with the
issues and it is difficult to conceive how a competent professional
acquainted with the issues,
as counsel would have been in this case,
could require more time for his task:
Hennie de Beer,
supra
at paragraphs 14 and 15. The application in my view, was
neither complex nor involved intricate issues of law and fact. The
counter
application was uncomplicated and the time spent in court for
the argument of both applications, according to the record, is four
hours. I therefore find that awarding an amount of R21000.00 or 14
hours under this sub-heading is unwarranted. The twenty hours
propounded by the taxing master could be considered reasonable and
realistic for the work done. The record itself was not “abnormally
voluminous”, as the submission made was that 600 pages were
perused. See
Scott and Another v Poupard and Another
1972 (1) SA 686
(A) at 690 B-D.
Items 6 and 12
The
taxing master allowed a re-perusal fee for the 97 pages received as
they related to the counter application. She was of the
view that no
new information could be provided, which was not already presented to
the attorneys in the main action. See paragraph
5 of
Hennie de
Beer,
supra
. In its submissions, first respondent
referred to the documents as consisting of correspondence between the
applicant and the respondents
relating to the matter, tender
documents and agreements. According to the first respondent’s
affidavit in support of its
opposition to the costs order by the
second respondent, the tender documents and agreements were already
part of the review application
as early as 19 May 2015. I support her
view.
CONCLUSION
[22]
In
Ocean Commodities Inc and Others v Standard Bank of SA Ltd
and Others
1984 (3) SA 15
(A) ([2002]
4 ALL SA 723)
18 F-G it
was stated that the court should be satisfied that the taxing master
was clearly wrong before it would interfere with
a ruling made by
him. In my view the taxing master applied the correct principles and
took the correct factors into account in
the taxing of the bill of
costs. I am satisfied that the fees in items 6, 12 and 48 should be
disallowed and the allocator be upheld.
ORDER
[23] In the result
the following order is made:
1.
The review application is dismissed;
2.
There is no order as to costs.
J.J.
MHLAMBI, AJ
On
behalf of the applicant: Adv. C. D. Pienaar
Instructed
by: Rossouws Attorneys
BLOEMFONTEIN
On
behalf of the respondent: Adv. D. J. van der Walt SC
Instructed
by:
Symington
& De Kok
BLOEMFONTEIN