IGG REPORT ON THE ALLEGED EXCESSIVE FEES PAYABLE TO KAMPALA ASSOCIATED ADVOCATES BY THE GOVERNMENT IS ENTIRELY WRONG

 IGG REPORT ON THE ALLEGED EXCESSIVE FEES PAYABLE TO KAMPALA ASSOCIATED ADVOCATES BY THE GOVERNMENT IS ENTIRELY WRONG

The Inspector General of Government (IGG) recently issued a report entitled, “Report on the alleged excessive fees payable to private lawyers representing Government of Uganda in the case of Jesse Mashate v. Gen. Yoweri Kaguta Museveni in London-HQT/22/8/12”.

The Report was issued with a lot of  fanfare and circulated to  various  media houses as “Press Information”, and was followed by a personal interview by the IGG,  broadcast live on one of the popular national TV networks and repeated on other TV stations.

It all seemed to be a carefully orchestrated publicity campaign designed to defame and denigrade a reputable law firm, Kampala Associated Advocates (KAA).

It needs to be recalled that the mandate of the IGG  is very well defined. Under Article 225(e) of the Constitution, mandates her office to investigate any act, decision or recommendation made by a public officer or any other authority in the exercise of administrative authority, whether acting on its own initiative or upon receipt of a complaint from a member of the public. KAA  is obviously not a public authority.

Yet, it is self-evident that the principal target of her  “investigation” and subsequent adverse comments made by her to the media concerning the Report’s main findings focused primarily on the role, competence and conduct of KAA, a private law firm. This clearly shows a manifest bias and malice against KAA and is a blatant violation of her constitutional mandate.

We wish to point out further that at no stage did the IGG, before reaching  and making these outlandish recommendations, accord to KAA any  opportunity to respond to  her Report that was issued after an expensive lengthy investigation of nearly two years duration. In her first communication to KAA, she actually told us “it was not KAA under investigation”.

This, omission in itself constitutes a violation of the basic rules of natural justice and goes to underscore the biased manner and indeed the malevolent intent with which her widely propagated findings and recommendations have been rendered.

 

Brief statement of the background

In 2007, Dr. Jesse Mashate, a journalist by profession, filed a suit for breach of contract against His Excellency Gen. Y.K. Museveni over alleged failure to compensate him for the wrongful closure of his periodical, the Weekend Digest, which had occurred in 1986.

Although the court papers were indeed served on the representatives of the Government of Uganda, for reasons which remain mysterious, the case was not defended before the High Court in London. Consequently, the Court had entered two successive exparte judgments against the President of Uganda in 2007 and 2010 respectively, meaning that the two cases were not at all defended before the Court.

By the time KAA was brought on board to take charge of this matter the judgment debt had reached an astronomical sum of £57,000,000/=, equivalent to approximately UGX 260,000,000,000/= to the tax payer.

Dr. Mashate had then successfully proceeded to secure a court order attaching four London located properties that belonged to the Uganda Government. Before he could however secure a final court order for the sale of the said properties, some KAA lawyers who happened to be in London handling another legal matter, learnt of this rather bizarre and alarming situation. As any patriotic Ugandan in our shoes would have done, we secured all the relevant documents pertaining to the case   and brought them to the attention of those at the State House Legal Department, since the case was brought against the President.

Following this, one of our partners, Joseph Matsiko, was invited to State House to brief the President on the matter. Thereafter the President instructed Rt. Hon. Amama Mbabazi, to ensure that the matter was urgently and properly attended to. The Rt. Hon. Amama Mbabazi, quite rightly then  referred the matter to the AG as there was clearly perceived need to retain lawyers to   robustly defend the case , and thereby avert the imminent sale of Ugandan properties. The AG, having now become seized with the matter, had then properly and legally instructed KAA and Edwin Coe Solicitors to fight the case.

This legal team, worked very hard to marshall all the arguments and evidence necessary to overturn the judgment and indeed succeeded in so doing on 30th October, 2011. This was an important legal victory as it completely nullified the earlier judgment and the court had even awarded costs against Dr. Mashate to the tune of £ 40,000. We were and shall always remain proud of our work in this regard.

Dr. Mashate has since then taken the legal battle to the Court of Appeal of England and Wales against the  High Court order restraining him from suing the President of Uganda. This case still goes on in London.

We, as KAA, wish to refute and repudiate in the strongest possible terms the said IGG report and to emphatically assert that our conduct in handling the above-mentioned matter has been of the highest ethical and professional standards. The IGG “findings” are completely without any  basis.

We would like in this regard to draw attention to one key document which is attached to the IGG Report as “ANNEX E”and entitled “Fees of Edwin Coe LLP in the matter of Mashate v. Gen. Y.K. Museveni (Claim No. 07×01288).” This document was written by M/s. Edwin Coe   in response to the specific request of the IGG,  to indicate the role, if any, played by KAA in the matter and whether its contribution was indeed necessary for the proceedings before the London High Court. Edwin Coe’s response categorically makes it clear  that the contribution of KAA was indeed “necessary” as  KAA had  “provided evidence in the High Court in London on the issue of the process of obtaining a judgment in default and on the issue of sovereign immunity”. The document emphasizes that “on the former subject (i.e. the necessity of KAA providing the evidence) it is obligatory to provide an explanation to the court as to why the Government had not responded to the proceedings and had allowed judgment to be entered in default.” [Emphasis added]

The response then goes to elaborate on the vital, crucial and substantial role played by KAA in the preparation and conduct of the case, as follows:

“In addition, KAA assisted us and the two barristers instructed in this jurisdiction in various tasks including:-

  1. 1.     Formulating the strategy to be adopted in handling the cases and preparation of skeleton arguments.
  2. 2.     Verifying with the relevant Government Departments, especially State House and the President himself, on matters relating to service of the amended claim form [plaint] and the judgment in default which the legal team had to fight to set aside.
  3. 3.     Gathering vital evidence to disprove Dr Mashate’s claim that there existed a contract between him and the President for compensation, enforceable in the UK courts.
  4. 4.     Dealing with the aspects of the case relating to sovereign immunity and gathering material to prove that indeed sovereign immunity applies in favour of the President.
  5. 5.     Obtaining witness statements from Hon Amama Mbabazi, Hon Dr Ruhakana Rugunda and letters from HE The President  … to deal with the false allegations of a contract, and to assert immunity.
  6. 6.     Preparing and filing in the High Court in London a witness statement signed by Joseph Matsiko covering the aspects of service of the amended claim form and the judgment in default, as well as aspects of sovereign immunity. That witness statement shows some of the work done by KAA in the case.
  7. 7.     The team from KAA travelled to London on four occasions in preparation for and hearing of the case. The Attorney General of Uganda was also present in court on one occasion.”

We must emphasize that the role of KAA was not merely to “assist” or “support“ but KAA actually took charge of the case including in identifying a suitable team of barristers, led by  Michael Sullivan QC, with whom KAA had previously worked on EADB case involving immunities and privileges, to argue the case in court.

It is however distressing to note that the IGG has either completely ignored or trivialized KAA’s role and has indeed reached conclusions that are at complete variance with the clear contents of the above document that was addressed directly to her office upon her request. KAA is proud of the role it played as we definitely saved this case, thereby the Ugandan tax payer.

 

The IGG states that KAA exaggerated the urgency of the situation whereas the matter was being competently handled by a previous team of lawyers that had been hired to handle the matter.

With all due respect, this claim is incorrect. The truth of the matter was as follows:

  • An amended claim form (plaint) had been filed in Sept. 2009 no response;
  • While there was evidence that the plaint had been served onto the Government through appropriate diplomatic channels on 5th February, 2010, this had not been acknowledged;
  • There was a default judgment entered into on 4th May, 2010, and at the time we learnt of this serious matter, almost a year later, no concrete steps had been taken to challenge it;
  • It is worth noting that this was not the first default judgment as there had been an earlier one in 2007 on the same subject matter;
  • Interim attachment orders had been issued on 15th December 2010, and for about 5 months no legal challenge had been put up.

If indeed, as claimed by the IGG, there had previously been a competent team of lawyers handling this matter, why then this pattern clearly showing a persistent trend of the case not being properly attended to if at all? The IGG also seems to have completely ignored the fact that there had been  previous legal teams  appointed by the Government, which included one  Peter Magomu Mashate, said to be  a  close relative of the Plaintiff, Dr. Mashate,  but Dr. Mashate was able to get a default judgment, so she should have investigated what went wrong.

The IGG  says that the work could have been done by government  lawyers who were senior to Mr. Joseph Matsiko who was lead KAA partner in the handling of this case. First, we need to point out that it is  not seniority or age that determines competence. Mr. Matsiko has been an outstanding practitioner who headed the Civil Litigation Department at the AG’s Chambers before he joined KAA in 2007. He has participated in high level litigation and participated in international arbitration in London and Paris. Besides, this matter was also handled by Mr. Peter Kabatsi, a former Director of Public Prosecutions and Solicitor General  with an outstanding international record as a former President of the UN International Law Commission, and presently a Judge of the Permanent Court of Arbitration at the Hague. We also had on the KAA team, Dr. Kallu Kalumiya, who served inter alia as a Senior Legal Counsel for the office of United Nations High Commission for Refugees (UNHCR) in Geneva, having lectured in International Law at Makerere and Nairobi Universities and having studied at the Universities of East Africa, Cambridge and Harvard. We highlight the competences and qualifications of these KAA partners in order to show that it was indeed a “world class legal team” that KAA deployed to handle the case.

 

The IGG report observes that the hiring of KAA to save properties of Government of Uganda from being sold in attachment was a misrepresentation of facts.

This observation is simply incorrect. First of all, there was no misrepresentation of facts to the President and the AG or anybody else on the part of KAA regarding the urgency of this situation. It is clear that following the second default judgment, the Court had issued Interim Attachment Orders on 15th December, 2010 and for about 5 months no challenge had been put up to nullify those orders.

Secondly, it is clear that in order to stop the charging orders and save the GOU properties from impending sale, the default judgment had first to be set aside, and this is precisely what the Edwin Coe/KAA legal team successfully managed to do on 21st October, 2011.

Once the default judgment was out of the way, the interim charging orders had necessarily fallen by the wayside. The CKFT Solicitors who represented Uganda Property Holdings Ltd (UPHL) in the matter and were in Court with us hardly had anything to do as the Edwin Co/KAA legal team had done virtually all the  legal work needed in successfully securing the reversal of the default judgment and thus providing the basis for the vacation of interim attachment orders. The IGG observations in this regard therefore are simply motivated by her apparent desire to trivialize and belittle the role played by KAA in the matter.

 

IGG insinuates that because Mrs Joy Kabatsi facilitated KAA meeting with the President, this was irregular and amounted to touting

This allegation is intellectually misconceived. Firstly, there is nothing wrong whatsoever in accessing the President through any of his legal aides. We wish to emphatically state that we did not go to the President to tout for any business. We simply brought the matter to the attention of his Legal Department since he had been named as the Defendant.  We were later requested to meet him and brief him about what we knew about the case, which we did.   In any event, the IGG herself refers to a letter by Mrs Joy Kabatsi dated 24th June, 2011, in which, on behalf of the PPS to the President, she clearly states to the AG  that “all matters pertaining to the appointment of counsel and their remuneration in this matter should be handled by you.”. The letter clearly shows that Mrs Joy Kabatsi was mindful of AG’s role and had no hand in the appointment of lawyers or their remuneration. It is therefore wrong of the IGG to impute anything wrong on the part of Mrs. Kabatsi, or to insinuate that KAA “touted”, when Mrs. Kabatsi categorically told the AG to handle the appointment of lawyers and their remuneration as he felt appropriate.

Secondly, the allegation that KAA went to the President to tout for business is as utterly false as it is preposterous and defamatory of our  firm and even of the President. The IGG has no iota of evidence whatsoever to substantiate this serious allegation.

Besides, it is not the President or the Prime Minister who gave KAA the instructions. It was the AG who by his letter dated 24th June 2011 wrote to KAA stating that “your firm had been identified as suitable to handle the defence of the suit. This is therefore to issue instructions to you to defend him”.  The fees were negotiated, and a contract signed with the AG himself. Neither did the President nor the Prime Minister ever state that we went to them asking or seeking for legal business (touting). There is therefore no basis for the IGG’s “finding” to state that we engaged in touting without any evidence. Clearly this libelous “finding”will not be allowed to stand and we intend to robustly challenge it before a court of law.

 

The IGG claims the fees due to KAA are grossly excessive

The IGG has asserted that the fees payable to KAA were excessive. The report does not however state by how much nor does she say what the total should have been. The IGG states that since the fees charged by KAA are higher than those of English Solicitors, they must be excessive. This, unfortunately, is like comparing apples to oranges! Edwin Coe charges under UK law, which rate is per hour and is not capped. Their fees therefore keep going up and indeed the Government has not paid all of Edwin Coe’s bills. Moreover, Edwin Coe will keep charging as the Mashate case goes through the Court of Appeal in the UK. By contrast Ugandan law stipulates the minimum fees lawyers can be paid and entitles lawyers to charge up to 10% of the value of the subject matter, on top of disbursements. KAA agreed to be paid 2% of the value, inclusive of all expenses and disbursements and the fees  remain capped at that level until the case is finalized. Thus the 2% charge inclusive of disbursements is way below the standard of the acceptable legal charges.

It should be noted that the KAA team had to incur substantial expense on airfares, accommodation in London, and had to forego many days from office, which was not the case with the London lawyers. It is indeed grossly unfair for the IGG to purport to stop KAA to recover even the money KAA expended from its own pocket, to defend the case.

Surely the IGG should have been mindful of these distinctions and thus avoid the misleading and simplistic conclusions made in her report. The IGG should also have been mindful of the fact that Ugandan Advocates  Remuneration Rules are applicable to Magistrates Courts and the High Court in Uganda, and were inapplicable to the Mashate case which  was  before an English Court.

 

The IGG report finds that AG procured KAA services contrary to PPDA provisions

The Advocates Act strictly prohibits competition among lawyers as providers of professional legal services. The IGG is therefore wrong to state that the PPDA law, which requires competition and is therefore not applicable, was breached.

Secondly, even if it were to be assumed that the AG had an obligation to comply with PPDA law, this would have been an internal management matter and one which would not affect the validity of the contract executed by AG and KAA.

Thirdly, the IGG is telling the AG that he entered into an illegal contract. With due respect, the Inspectorate of Government is not a court of law and cannot rule on the legality or otherwise of contracts freely entered into between the AG and private law firms or other competent parties. The only authority which can nullify a contract is a court of law. It is also against the Constitution for the IGG to impeach the AG on basis of a contract drafted, negotiated and executed by the AG himself. The IGG has no appellate authority to overrule the AG on his legal determinations.

 

Conclusion

We state, in conclusion, that a fair, professional and proper inquiry would have:

a)    Been directed to focus on the role of public officials or any other authority and not on private lawyers;

b)    Critically assessed the contribution made by the previous legal team before concluding that KAA’s involvement was unnecessary;

c)     Definitively concluded that it was the Court’s overturning of the exparte judgment that provided the key for the removal of the property attachment orders;

d)   Avoided usurping the role of the AG and the Courts in determining the validity or legality of contracts approved by the AG;

e)     Conducted a comparative survey of other complex cases litigated abroad on instructions by government and then applied a clear criteria for determining whether the fees in this matter were, in comparative terms, indeed excessive;

f)      Concluded that KAA had indeed acted ethically and professionally in reporting the dire and alarming state of neglect of the case that had been filed in London against the President;

g)    Concluded that KAA had fully discharged its contractual obligations and, as such, was entitled to its fees as earlier negotiated ;

Accordingly, KAA is determined, not only for its own sake but also for that of entire legal fraternity, to take robust legal action in order to defend its honour, integrity and reputation against this gross abuse of power, and to have this misconceived and misdirected report overturned and declared null and void.

 

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