Commercial Law Index

The matter involved a question of competency of appeal regarding a land dispute.

The court referred to section 47(1) of the Land Disputes Courts Act which allows a person, when aggrieved by the decision of the High Court, to appeal to the Court of Appeal provided they have been granted leave in accordance with the Appellant Jurisdiction Act.

The court reasoned that as there was no valid and surviving leave to appeal, the appeal was incompetent. It considered this failure to comply with a mandatory step in the appeal process as fatal to the appeal and therefore struck out the appeal fo incompetence

The matter involved a review application against an appeal court’s decision granted against the applicant.

The main question revolved around whether the grounds for a review application were satisfied. The court relied on rule 66(1) which states that a review application is entertained only if the decision under challenge ‘was based on a manifest error on the face of the record resulting in the miscarriage of justice.’ It also relied on the Charles Barnabas v Republic, Criminal Application No. 13 of 2009 and Chandrakant Joshughai Patel v Republic, [2004] TLR 218 cases for the authority that a review does not challenge the merits of a decision but rather irregularities in the process towards the decision hence why it is not something that can be proved by a long-drawn process of learned argument. In addition, persuasive authority was drawn from the National Bank Of Kenya Limited v Ndungu Njau [1997] eKLR case as authority for the proposition that a review cannot simply be raised on the basis that a different court would have reached a different conclusion on the same facts nor because the court misinterpreted the provisions of the law.

In application, the court reasoned that the grounds proffered by the applicant which included failure to prove lawful occupation of disputed land or the fact of that the disputed land belonged to the Village Council were in fact grounds of an appeal since they went into the merits of the decision.

The court therefore concluded that a review could not be raised on grounds of appeal and consequently struck out the application.   

The matter involved a dispute over an order of suit property sale as a remedy for breach of a loan agreement granted by the trial court against the appellant.

The first question was whether the responded had paid the whole stipulated loan amount to the appellant. Assessing the evidence in the record from the trial court, the court reasoned that the trial court’s assessment had failed to evaluate crucial evidence that showed doubt in the respondent’s claim that the whole stipulated amount had been paid. The court thus concluded that the evidence indicated that the responded had failed to fully honor its performance obligation. As a result, the responded could not pursue the remedy of obliging the appellant to transfer the property for failure to repay the loan.  

The second issue concerned the right to mesne profits (i.e. profits received by tenant in wrongful possession and which are recoverable by the landlord) by the appellant and the amounts due. The court did not dwell much on the question of entitlement, instead accepting the trial court’s finding of indisputable occupation and rental collection by responded as a basis together with the fact that responded could not justify the occupation.

The court thus concluded that mesne profits were owed but order that they be set-off to the amount of the loan that the appellant still owed. The decision of the trial court was therefore set-aside and appeal allowed.

The respondent sued the appellant for general damages and restoration of the value of certain of its properties, arising from their sale at a public auction, prompted by a warrant of distress issued under the Income Tax Act. The High Court found that the respondent bore no tax liability to the appellant at the time the warrant was issued, and consequently that the vehicles were unlawfully distrained and sold, before making an award of damages, interest and costs of suit in the respondent’s favour.

On appeal, the tax authority successfully challenged the High Court decision on the grounds of jurisdiction. It contended that the relevant tax legislation (primarily the Income Tax Act, 1973) had established fora to preside over tax disputes at the first instance. As the respondent had failed to exhaust these internal statutory remedies before launching court proceedings, the High Court lacked jurisdiction to hear and determine the matter. The court had ousted the jurisdiction of the specialised fora designed for that very purpose.

Reiterating that jurisdiction may be raised by the parties or suo moto (by the court itself) at any stage of proceedings – even on appeal – the appellate court quashed and set aside the High Court’s decision and upheld the appeal.

This was an application for a revision in respect of execution proceedings and a garnishee order.

The respondent raised preliminary objections: that the court lacked jurisdiction to determine the revision; that the court has not been moved and that the application was bad for not being accompanied with the order sought to be revised.

The court dismissed the final objection since there is no legal requirement for the same.

The court determined that it had jurisdiction, by applying the rule that all revisions of a civil nature in a resident magistrate court shall lie to the high court. The court interpreted this provision to include execution proceedings from resident magistrate courts.

In determining the second objection, the court observed that the applicant had cited non-existent legislation by referring to the Magistrates’ Court Act as the Resident Magistrates Court Act. It applied the rule that when an applicant cites the wrong provision the matter becomes incompetent since the court is not properly moved, to hold that it had not been moved. The court also considered that the applicant wrongly cited s 79 of the Civil Procedure Code. In doing so, it appreciated the difference on revision that may be undertaken per s 79 of the Civil Procedure Code and per ss 43 and 44 of the Magistrates Court Act: s 79 referred to finalized cases while the rest refer to any civil proceedings.

Accordingly, the application was struck out with an order as to costs in favor of the respondent. 

The applicant applied to set aside an arbitration award made in 2015. It was argued that the arbitrator misconducted herself when she amended the award; when she awarded nominal charges to the second respondent; and gave no reasons for ordering costs against the applicant, who was successful at the arbitration.

An arbitration award may be set aside on the grounds of an error on the face of it when reasons given for the award are based upon a legal proposition that is erroneous. It was found that the arbitrator’s reasons for making the award were erroneous and contrary to the Civil Procedure Code when awarding costs against the winning party. No reasons were provided for apportioning the costs, and for heavily weighting the costs against the winning party.

A court may also set aside an award if it is bad on its face for involving an apparent error in fact or law, or it has not complied with the requirements of finality and certainty. The award was bad on its face as it granted costs based on an apparent error of law by apportioning greater costs to the winning party. It is trite law that the losing party should bear the costs of a matter to compensate the successful party for expenses incurred for having to vindicate their rights.

The court held that there was good cause to remit the part of the award on apportionment of costs for reconsideration by the arbitrator.

The applicant filed to the court an application for the execution of the decree by attachment and sale of the judgment debtor’s property.

The issue was whether an appeal can prevent the execution of an order.

The court noted that in any civil proceedings, where the notice of appeal has been lodged in accordance with rule 83, an appeal shall not operate as a stay of execution of the decree or order appealed from except so far as the high court or tribunal may order, nor shall execution of a decree be stayed by reason of an appeal having been preferred from the decree order but the court may upon good cause shown, order stay of execution of such decree or order. The court may, upon good cause shown order stay of execution of the decree or order. It is only where there is an order for order for stay of execution that a trial court is estopped from issuing an execution order.

The execution process has two stages. The first stage is the issuance of an executive order and the second stage is the enforcement of that order which is normally done in the registry or other designed officer in the registry.

The courts took into consideration the fact that there was no order or stay of execution and concluded that it could make an order for execution despite the pendency of an appeal suit.

Execution order was granted

The court considered an application for temporary injunction restraining the respondents from selling two seized motor vehicles. Furthermore, the court considered whether the right of seizure and sale can be exercised without the intervention of the court.

This case concerned an agreement for the sale and purchase of 10 motor vehicles. The applicant alleged that the agreement was oral, whereas the respondents alleged it was written. The applicant subsequently defaulted on the payment and the first respondent seized the vehicles and threatened to sell the vehicles on public auction.  

The court found that the agreement concluded between the parties was in fact a written agreement.

The court considered the provisions of S 124 – S 128 of the Law of Contract Act. The basis of these provisions found that the pawnee may retain goods pledged for payment of any debt and may bring a suit against the pawnor upon the debt and retain the goods pledged as collateral security or he may sell the thing pledged.

The court found that the applicant (pawnor) defaulted in payment and the first respondent (pawnee) had the option of bringing a suit against the pawnor and retaining the goods as security or sell the thing pledged by giving the pawnor reasonable notice. If the proceeds are less than the amount due, the pawnor is liable to pay the balance. If the proceeds are more, the pawnee shall pay the surplus to the pawnor.

A pawnee, in possession of the title and the property pledged is entitled to sell the property without intervention of the court. However, in absence of possession, he cannot take the law into his own hands without the court’s intervention.

The court found that there was no clause in the agreement empowering the first respondent to take possession and sell the vehicles, and thus he cannot exercise his right without the court’s assistance.

Application succeeds.

This case concerned an action for breach of contract, and an objection to jurisdiction. The dispute emanated from a loan advanced to the plaintiff by the defendant. The plaintiff deposited his share certificate as security for the loan. The plaintiff contended that the loan was fully repaid and the security discharged; notwithstanding this the defendant informed the Dar es Salaam stock exchange that the share certificates has not been discharged and that the defendant still held an interest in the share certificate. The plaintiff complained to the court that the defendant’s conduct was defamatory and had affected its operation.

The defendant raised an objection to the claim arguing that the court lacked jurisdiction to hear the matter. It based its argument on the grounds that the claim was based on an amount below 100 million shillings. The plaintiff on the other hand argued that the claim was based on US $2.5 million, an mount which falls within the jurisdiction of the court if converted into shillings.

In deciding the case, the court dismissed the defendant objection and ruled that it had jurisdiction to hear the matter.

The case concerned a dispute about how to commence litigation on behalf of companies. The court held that whether or not failure to seek and obtain the permission of a company to institute litigation or an application is no longer the law in Tanzania. It was held that the issue of jurisdiction will allow a court to investigate factors to determine if the company gave permission to institute court proceedings. However, the party alleging that the company did not give authority must prove their case. Only when there is sufficient evidence will the court investigate the issue of jurisdiction. In this case, the applicant failed to prove his case and the application was dismissed.

In this case, the appellant claimed that the trial magistrate erred in holding that the appellant had a contractual duty to inform the respondent of the garnishee order. This case illustrates the duty to inform with regards to garnishee orders that also applies to banks.

The court considered whether the trial magistrate erred in holding that the appellant was legally bound to inform the respondent on the existence of the garnishee order. The court held that a bank has the duty to inform a customer in good time of a garnishee order so that the customer may take legal steps if he so wishes. Thus, the court held that though a notice from the appellant had been made in good time the fact that it reached the respondent late amounted to a breach of the fiduciary duty between them.

The court also held that it is a principle of law that an issue not raised at trial will not be entertained on appeal. Thus, the appellant was not allowed to raise questions as to whether the garnishee order was satisfied nor whether it was set aside.

In considering general damages, the court held that the trial court was correct in awarding general damages. The court dismissed the appeal in its entirety.

The respondent raised preliminary points against the application on the grounds that a valid and appropriate affidavit did not support the application according to the Civil Procedure Code, Cap 33 of the Revised Edition 2002 order XLIII rule 1. Further, that the application was incompetent for being omnibus.

The court considered whether wrongfully mentioning a person in the chamber of summons which has been sworn by another in support of the application is a fatal ailment. Further, whether the application is omnibus because it contained two applications, namely, for extension of time, if successful a stay of execution.

The court held that wrongfully mentioning a person in the chamber of summons in support of an application is trivial to warrant striking out the whole application. Further taking the course will be conforming to the spirit of the Constitution art 107A (2) (e). The court also held that the vision of the judiciary is to administer justice effectively. Therefore, it would not be inappropriate for courts of law to encourage a multiplicity of proceedings. More so, an application comprising of two or more applications which are interrelated is allowable at law.

The court found that striking out the application will amount to wasting of resources because the applicant would possibly come back later with the replacement of names in the application.

The court accordingly allowed the applicant to substitute the names in the chamber summons, rectify the names by hand with an initial beside the handwriting alteration.

A court can dismiss a matter for want of prosecution where the person who initiated the court action does not take active steps to pursue the case in court such as not appearing in court. The court dealt with a case where the lawyer did not appear before court on the date for hearing. The case was thereafter dismissed for want of prosecution. This case was an application to set aside the order to dismiss the original court suit for want of prosecution.

To set aside an order that a court suit be set aside for want of prosecution, the applicant must give sufficient grounds that must balanced against the interests of justice. In this case, the lawyer for the applicant did not appear because he was unwell on the court hearing date. The court held that this constituted a sufficient reason to set aside the notice to dismiss the case. In the interests of justice and the compelling reasons, the application to set aside the notice to dismiss was granted.