Give senior lawyer his current tax compliance certificate, high court orders

Read judgment here

Professor Tom Odhiambo Ojienda is a familiar name in Kenya’s law reports. At the moment he is involved in several long-running disputes over his tax affairs, without any indication that these matters will be resolved any time soon.

Most recently, however, he was in court to persuade the constitutional and human rights division of the high court that he ought to be issued a tax compliance certificate even though the tax authorities had refused to oblige.

Ojienda told Judge Wilfrida Okwany that he was a member of the Judicial Service Commission, representing the Law Society of Kenya on that body, and that his term of office due to expire on 6 April 2019.

In November 2018 the Law Society advertised for nominations to fill the post that would become vacant in April, namely its male representative on the JSC. The deadline for nominations for the post was set at mid-December 2018, and one of the stipulated requirements was a current tax compliance certificate. Though he had been issued with a valid tax certificate every year since 2011, he was unable to get a new certificate when his old one expired in November 2018. In his view, this was a strategy to ensure that he would be out of the running for the Law Society’s position on the JSC.

Ojienda said that all one needed for such a certificate was “remittance of accounts and payment of appropriate tax for the year in question”, conditions that he had met every year, and that year this was no exception.

In refusing to give him his current certificate the tax authorities were acting “maliciously and irrationally”, he said, in order to “lock him out of the upcoming elections” for the JSC. One reason for Kenya’s revenue bosses to act as they had was that he was involved in several disputes with them about his assessments including an assessment that had been set aside by the high court in May 2018, via a judgment that was now the subject of a pending appeal.

He said that the tax authorities refused to reconsider his application for the certificate, and in so doing they clearly showed “malice, bad faith, witch hunt, unreasonableness”, a “total disregard” for the court process and “abuse of office” in order to keep him out of the running for the JSC position, a move that violated his political rights under the constitution.

He said he was entitled to an interim order for the certificate as he had already complied with all the requirements and there was so little time before nominations closed and if the certificate were not forthcoming despite the court's order, then he was entitled to an order that the law society accept his nomination as valid, even without such a certificate.

The judge said that she did not have to make any definite finding of fact or law, as that would be the work of the court that would finally hear the full petition. At this stage Ojienda only needed to establish that on the face of it this was a case with a likelihood of success. Ojienda also needed to show that unless the order were granted he stood to suffer real danger or prejudice. The test was not whether the case would definitely succeed at the full hearing, but rather whether it was a case that was “not frivolous”.

“My take is that considering the totality of the issues raised in this petition, this court cannot say that the … case is frivolous," said the judge. "Indeed, I find that the dispute … over the issue of assessment of taxes is a longstanding legal battle that began way back in 2016 when (Ojienda) filed the judicial review case which was determined in his favour in May 2018.”

It was not in dispute that Ojienda had “fully complied” with the requirements for his current certificate to be issued. It was also not in dispute that the reason the tax authorities refused to issue the current certificate was because of the pending appeal.

Because of this pending appeal, the judge decided it would be inappropriate to “delve” into that dispute, but that she would only consider whether Ojienda had made out a case, on the face of it, to warrant the interim orders he had sought.

In her view, Ojienda had established that he had “an arguable case” against the revenue authority in terms of which he stood to be severely prejudiced if the order were not granted. On the other hand, the tax authorities and the Law Society had not shown any loss they would suffer if the court made an order against them. The revenue authorities could cancel the certificate at a later stage if Ojienda were to lose the main case.

It was not in dispute that Ojienda had already obtained orders against the revenue authorities in other cases including one barring them from “initiating civil or criminal proceedings” against him over the disputed tax assessment. Now that bar was cited by the taxman as the reason that a certificate could not be issued. From all these factors, said the judge, “one cannot help but … feel that the real reason” for the refusal of the certificate, particularly when he needed it for nomination to the JSC, was to “pile pressure” on Ojienda “to give up or withdraw the case that he filed” against the revenue authority.

In the circumstances, it seemed that the taxman was attempting to steal a march on Ojienda in the pending cases, and for that alone a mandatory injunction was merited.

She therefore ordered that Ojienda be given his certificate immediately, but that, even if the revenue authorities refused to obey, the Law society should accept his nomination without a current compliance certificate.

The court’s decision given on 4 December 2018 was quickly met by a revenue authority announcement that it would appeal. By the time the appeal was noted, however, Ojienda had already put in his nomination for the JSC position.