Lake Gas Limited and Lake Oil Limited have lost their legal bid to force their Kenyan competitor, Proto Energy Limited, to pay them Sh148.7 million in legal costs over a dismissed licensing dispute.

The High Court upheld a previous decision by Magistrate Christine Asuna Okello that awarded the two Tanzanian firms just Sh968,282, rejecting their attempts to inflate the fees.

Justice Roseline Aburili dismissed the application challenging the magistrate’s decision, describing it as an unjustified attempt to push for an excessive payout. She ruled that the magistrate, in her capacity as taxing master, acted within the law by reducing the claimed instruction fees from Sh95.9 million to Sh600,000.

“The taxing master in reaching the decision, was well within her mandate and the confines of the law. The interested parties’ claim for Sh95.9 million as instruction fees was not only unsubstantiated but also grossly exaggerated,” stated Justice Aburili.

The firms had also sought Sh31.9 million as getting up fees for their advocates but were awarded only Sh200,000.

The legal costs arose from a case filed in 2020 by Proto Energy against the Energy and Petroleum Regulatory Authority (Epra).

Proto had contested the issuance of business licences to Lake Oil and Lake Gas, citing outstanding debts and unpaid storage expenses related to a cylinder deposit agreement.

According to Proto Energy, it transferred Sh87 million worth of cylinder deposits to Lake Gas in 2019 and incurred Sh2.7 billion in storage costs under the LPG Cylinder Pool Agreement.

The company asked the court to stop Epra from issuing licences to the two Tanzanian firms until the debts were cleared. However, the case was dismissed in June 2021 after the court found that Epra had not formally decided to license the firms.

Lake Gas and Lake Oil had argued that the instruction fees awarded by the magistrate were too low and failed to account for the complexity and urgency of the case.

But Justice Aburili said they failed to demonstrate any legal error or misdirection by the taxing master.

“I note that Lake Gas Limited and Lake Oil Limited have not pointed out to this court any identifiable misdirection in law or in principle by the taxing master. Nor have they demonstrated that the award is so inordinately low as to constitute a miscarriage of justice,” said the judge.

She noted that since the original case was dismissed before reaching full hearing, there was no evidence of substantial trial preparation. Proto Energy’s Head of Legal, Wambui Maina, opposed the request for higher legal fees, saying the claim was exaggerated, unjustified, and did not match the actual work done.