Saturday, 5 August 2017

Ex-LSK boss Ojienda could earn over Sh500m in legal fees

More by this AuthorSenior Counsel Tom Ojienda addresses the courtSenior Counsel Tom Ojienda addresses the court on June 12, 2017. The JSC commissioner has six pending judicial review cases. PHOTO | PAUL WAWERU | NATION MEDIA GROUP 

Law Society of Kenya representative to the Judicial Service Commission (JSC) Tom Ojienda could earn up to Sh1 billion in legal fees, thanks to the failure by the Nairobi County government and other State agencies to defend taxation cases in court.
Some of the court awards have already been secured by the lawyer while others, arising from several cases in which he has represented the county government, are pending.
The taxation cases resulting from the litigation of various cases have gone undefended, ultimately earning the lawyer millions of shillings to the detriment of the taxpayer.
Apart from reaping from the taxation cases, the JSC commissioner has obtained numerous High Court orders in his favour and on behalf of his high-end clients.
For instance, the court has already awarded Prof Ojienda Sh220 million after a High Court judge dismissed an application by the National Land Commission (NLC) to set aside a taxed bill of costs.
Of the six pending cases, three have been concluded while a similar number has proceeded to an advanced stage.
Prof Ojienda could soon be paid Sh225 million should a matter he has lodged seeking orders to have City Hall compelled to pay him costs be decided in his favour.
The court has ruled in his favour in three suits and awarded him costs.
City Hall is fighting to set aside a ruling on the cases in which he has been awarded Sh40.9 million.
On the recent suit in which he obtained a judgment of Sh220 million, Prof Ojienda defended NLC against the Lands ministry in the Supreme Court after the commission sought an advisory opinion on who had the mandate to issue title deeds.
Although the commission lost the case after the judge ruled the issuance of title deeds was a preserve of the ministry, Prof Ojienda had the last laugh.
The lawyer later filed an application in the High Court to enforce the payment of the Sh220 million awarded by the taxing master and obtained a judgment in record time.
In his ruling, Justice Ogembo took issue with the commission, saying court records had showed that NLC was not interested in opposing the lawyer’s bill of costs.
“To me, the chronology of events showed clearly the commission was disinterested in the whole taxation process despite being given at least two opportunities to lodge its objection as required by the law,” Justice Ogembo said.
The JSC commissioner has six pending judicial review cases in which he is seeking to enforce payment of fees and disbursements from taxed bill of costs for representing Nairobi County.
In three judicial review cases, all of which were lodged this year, Prof Ojienda is seeking orders to compel the county secretary Robert Ayisi to pay him Sh225 million.
He has already won round one of the cases after High Court Judge George Odunga gave him the nod to prosecute the cases.
The court that taxed costs made favourable decisions on Prof Ojienda in four cases involving Nairobi County.
He was awarded Sh40 million and another Sh8 million.
Thereafter, the lawyer obtained awards of Sh20 million and Sh12.7 million.
The City County has filed an application challenging the decision of the High Court Deputy Registrar who taxed the bill.
It also wants the ruling suspended and the certificate of taxation set aside.
Sources familiar with litigation matters indicate the costs taxed by the lawyer are rather high compared to the Advocates Remuneration and Taxation Costs.
The lawyer, who practises under Prof Tom Ojienda Associates, is also fighting legal battles with the taxman and the Ethics and Anti-Corruption Commission (EACC).
He moved to court late last year after the taxman demanded Sh378 million tax arrears, which include unremitted employees’ PAYE.
The Kenya Revenue Authority (KRA) argued that the lawyer had evaded tax on his income as legal fees estimated at Sh1.1 billion received from Mumias Sugar Company and Nairobi County.
Justice Odunga issued orders stopping the KRA from recovering the tax arrears.
But what infuriated the taxman is that the blanket stay orders were issued in the absence of KRA and without requiring the respondent to deposit security for costs. The case is pending.
Prof Ojienda is also acting for the Nairobi County in another case in which KRA is demanding taxes emanating from failure by City Hall to remit the statutory deductions for its employees.
The authority issued agency notices to the banks seeking to recover the arrears amounting to Sh4.7 billion.
Justice Odunga issued ex-parte orders suspending the agency notices to recover the taxes.
In another case involving KRA, the High Court on October 10 last year issued orders restraining the taxman from compelling, arresting or in any way harassing Mr Ayisi to provide information or communication between City Hall and Prof Ojienda, pending the hearing and determination of the case.
The case, awaiting determination before Justice Odunga, arises from investigations KRA conducted on Prof Ojienda after receiving intelligence reports that the county government had procured legal services from his firm for Sh92.8 million in a case against the Nairobi Metropolitan Public Service Vehicle Sacco.
The lawyer acknowledged payment of Sh30 million but argued that the fee note was modest because of his good relationship with the county.
By winning the parking fees case, Prof Ojienda said he saved the county from incurring Sh9.5 billion loss over five years.
“If the fee computation was based on Sh9.5 billion as should be for instructions’ fees to a lawyer, I would have earned Sh286.4 million per scale before taxation and disbursements,” he said while defending himself against claims by Auditor-General Edward Ouko that the county had entered into contract with the lawyer without due diligence and proper review or advice from the legal department.

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