PLATEFORME COMPANY RWANDA LTD v. MUHITTIN ISILDAK

# PLATEFORME COMPANY RWANDA LTD v. MUHITTIN ISILDAK

- Source: Amategeko - Section: Decisions (Judgements) - Date: 2025-02-03 - Case/document no.: RCOMAA 00007/2025/CA - Collection: Court of Appeal

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PLATEFORME COMPANY RWANDA LTD v. MUHITTIN ISILDAK [Rwanda COURT OF APPEAL – RCOMAA 00007/2025/CA (Ngagi, P.J.) March 21, 2025] Laws governing commercial cases – Time limits for lodging an appeal – The claims seeking the judicial confirmation of a debt arising from a commercial transaction and the conversion of a seizure into a distraint shall be adjudicated in accordance with summary procedure, and any appeal shall equally be lodged and processed within the statutory timelines governing summary procedure, that is, within three (3) working days. Facts: After MUHITTIN ISILDAK had leased his building to PLATEFORME COMPANY RWANDA Ltd, and the latter failed to pay the monthly rent of USD 750 as mutually agreed, he sought the intervention of court bailiffs who seized the assets on the leased premises. Subsequently, he filed a claim before the Commercial Court, seeking judicial confirmation of the rental debt and requesting that the seizure be turned into a distraint. He further prayed for the award of interest on the outstanding amount and reimbursement of litigation-related expenses. PLATEFORME COMPANY RWANDA Ltd raised a preliminary objection of lack of jurisdiction of the Commercial Court, arguing that the creditor should have initiated the claim through the ordinary procedure, starting with a pre-trial conference. They contended that a judge adjudicating the case related to the summary procedure cannot determine the merits of a case to confirm the existence of a debt, rather the judge issues interim orders in case of urgency; that the confirmation of a debt does not constitute an interim order, it is rather a final judgment. The Commercial Court ruled that those objections were irrelevant. The Commercial Court rendered judgment dismissing the objection raised by PLATEFORME COMPANY RWANDA Ltd as baseless and declared that the seizure carried out on its property was thereby turned into a distraint. Dissatisfied with the decision, PLATEFORME COMPANY RWANDA Ltd appealed to the Commercial High Court, requesting to the Court to order the respondent to refund the amount of money received. The Commercial High Court confirmed the decision of the Commercial Court. PLATEFORME COMPANY RWANDA Ltd then appealed to the Court of Appeal, where MUHITTIN ISILDAK raised a preliminary objection of inadmissibility, contending that the appellant had filed the appeal out of time. He argued that, since the case concerning the seizure of a rental debt, requesting to the court to confirm the debt and to convert the seizure into a distraint, are the matters that fell within the category of urgent claims (summary procedure) and any appeal should have been lodged within three (3) working days from the date of pronouncement or notification of the court decision. In response, PLATEFORME COMPANY RWANDA Ltd argued that the judgment appealed against was rendered on 19/12/2024, and the appeal was lodged on 15/01/2025; therefore, the appeal time limit was duly observed, since the time limit for appeal is thirty (30) days, given that the case in question is not an urgent claim (summary procedure). Held: The claims seeking the judicial confirmation of a debt arising from a commercial transaction and the conversion of a seizure into a distraint shall be adjudicated in accordance with summary

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procedure, and as they do not derive from any principal lawsuit, they shall equally be heard, pronounced and appealed within the time limits provided for summary procedure cases, that is, within three (3) working days. The objection relating to non-observation of time limits for lodging an appeal has merit. The court fees cover expenses incurred in the case. Statutes and statutory instruments referred to: Law no 22/2018 of 29/04/2018 relating to the civil, commercial, labour and administrative procedure, articles 188, 231 and 232. Statutes and statutory instruments referred to: Law no 22/2018 of 29/04/2018 relating to the civil, commercial, labour and administrative procedure, articles 188, 231 and 232. Cases referred to: RCOMAA 00040/2022/CA; BALTON CP v. NEW CENTURY DEVELOPMENT Ltd decided by the Court of Appeal on 23/09/2022.

Judgment I. BACKGROUND OF THE CASE [1] MUHITTIN ISILDAK states that on 01/01/2024 he leased his building to PLATEFORME COMPANY RWANDA Ltd for a monthly rent of seven hundred and fifty United States dollars (750 USD), but that the company refused to pay voluntarily despite carrying out business activities and generating income every month. He explains that, although he repeatedly reminded PLATEFORME COMPANY RWANDA Ltd to honour its rental obligations, the company failed to take any action. He further indicates that the company’s intent to permanently deprive him of the accrued rents became evident when it attempted to surreptitiously remove its equipment from the leased premises, and when it refused to sign a settlement agreement that it had itself requested. He adds that, as a result, he sought the intervention of court bailiffs, who proceeded to carry out a seizure on the equipment located at the leased premises. He then filed a claim seeking judicial confirmation of the rental debt, together with an order turning the seizure into a distraint. He also claims the accrued interests on the outstanding debt as well as litigation-related expenses. [2] MUHITTIN ISILDAK further explained that the outstanding rental debt owed to him amounts to ten months of unpaid rent (10 months), equivalent to USD 75,000, and that this amount should continue to accrue until the judgment becomes final. [3] PLATEFORME COMPANY RWANDA Ltd raised a preliminary objection, arguing that the Commercial Court lacked jurisdiction to hear this matter because a creditor in such circumstances must follow the ordinary way of filing a case, starting with a pre-trial conference. The company further contended that a judge adjudicating summary procedure cases cannot

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adjudicate the merits of the case to confirm a debt, as such a judge may only issue an interim order in case of urgency. that confirmation of a debt is not an interim order; it is rather a final judgment. The Court, however, ruled that the objection is irrelevant. [4] PLATEFORME COMPANY RWANDA Ltd further argued that the claimant is a foreign national and should therefore be required to provide security for foreigners, which could be used to satisfy any award of costs should he lose the case. It additionally claimed that the claimant lacks standing and legal capacity to sue because the alleged debt arises from a lease agreement as he does not prove his ownership of the leased property, asserting that he is merely seeking undue gain. The company maintained that it had leased from MUHITTIN ISILDAK commercial premises and that the parties had agreed he would provide all documents relating to ownership of the property; that although MUHITTIN ISILDAK had notified it that rent payments would not commence until after six months, on 01/01/2024 he sent a lease agreement accompanied by documents relating to property rights as previously agreed, and also confirmed that no amendment to the lease was to be made before the agreed period elapsed. The company asserted that it had already begun paying rent and that the total amount paid so far is 1,465,000 Rwandan francs, comprising Frw 1,065,000 received via mobile money and Frw 400,000 paid in cash on various dates. [5] The company further argues that although it paid the rent, a dispute later arose regarding the UPI numbers indicating the ownership of the property. It explains that when they inquired about this issue, the claimant informed them that he was the owner of the premises. It adds that after paying for electricity, they discovered that the name appearing in the REG system and the property registered under UPI: 1/01/06/07/47 belongs to the University of Kigali, which, in their view, demonstrates that MUHITTIN ISILDAK was receiving rent for the premises fraudulently. [6] In its judgment RCOM 01630/2024/TC rendered on 20/11/2024, the Commercial Court held that:  the objections raised by PLATEFORME COMPANY RWANDA Ltd, namely that MUHITTIN ISILDAK must first provide the security for foreign nationals and that he lacks standing and legal interest to sue, are irrelevant;  the counterclaims lodged by PLATEFORME COMPANY RWANDA Ltd seeking the cancellation of the lease agreement for lack of consensus due to alleged improper representation, the reimbursement of all sums received by MUHITTIN ISILDAK, as well as damages and interest arising from alleged misconduct by the Court Bailiffs, are inadmissible;  the allegations by PLATEFORME COMPANY RWANDA Ltd that the lease agreement is void on the grounds that MUHITTIN ISILDAK leased premises he did not own are baseless;  the rental arrears owed by PLATEFORME COMPANY RWANDA Ltd to MUHITTIN ISILDAK amount to seventy-five thousand United States dollars (USD 75,000);  PLATEFORME COMPANY RWANDA Ltd must pay MUHITTIN ISILDAK the said USD 75,000 in rental arrears, together with litigation expenses consisting of Frw 1,000,000 as advocate fee and Frw 100,000 as legal costs;

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 the seizure of movable property for unpaid rent, as established in the bailiffs’ report dated 30/10/2024 prepared by Court Bailiffs Counsel Fortunée Nyirabizeyimana and Counsel Shakila Liliane Nyirarugwiro, is hereby turned into a distraint;  PLATEFORME COMPANY RWANDA Ltd must reimburse MUHITTIN ISILDAK the Frw 20,000 he deposited as court fees. 

[7] PLATEFORME COMPANY RWANDA Ltd appealed to the Commercial High Court, alleging that the Commercial Court failed to comply with Articles 91, 9, 10 and 24 of Law no 22/2018 of 29/04/2018 relating to the civil, commercial, labor and administrative procedure, and requested to the Court to order the defendant to refund the monies allegedly received. MUHITTIN ISILDAK responded that the appeal lodged by PLATEFORME COMPANY RWANDA Ltd lacks merit. [8] In the judgment RCOMA 00737/2024/HCC delivered on 19/12/2024, the Commercial High Court held that the appeal filed by Plateforme Company Rwanda Ltd was baseless and ruled that the decision in RCOM 01630/2024/TC, rendered on 20/11/2024 by the Commercial Court, remained unchanged. It further ordered that court fees be transferred to Public Treasury. [9] PLATEFORME COMPANY RWANDA Ltd again appealed to this Court, its appeal was registered under RCOMAA 00007/2025/CA. The case was heard in public on 05/03/2025, with PLATEFORME COMPANY RWANDA Ltd represented by Counsel DITCHOU TCHOUNJA Charles Claude Duplex, and MUHITTIN ISILDAK represented by Counsel Ndorimana Arnaud. The Court proceeded to hear the preliminary objection on non-compliance with appeal time-limits raised by counsel for MUHITTIN ISILDAK. II. ANALYSIS OF LEGAL ISSUES i. Whether PLATEFORME COMPANY RWANDA Ltd delayed lodging their appeal [10] Counsel for MUHITTIN ISILDAK argues that the appeal filed by PLATEFORME COMPANY RWANDA Ltd is inadmissible for having been lodged out of time. He explains that the case is based on a distraint relating to unpaid rent, a case which requires the Court to confirm the existence of a debt, and that the request for the seizure to be turned into a distraint constitutes a matter to be heard under summary procedure. He relies on paragraph 5 of Article 231 of Law no 22/2018 of 29/04/2018 relating to the civil, commercial, labor and administrative procedure, which provides that such case is heard in the form of summary procedure. He further submits that paragraph 2 of Article 188 of the same Law stipulates that the appeal is made within three (3) working days from the time the order was pronounced or from the day the parties were aware of the decision. [11] He further explains that the judgment under appeal, RCOMA 00737/2024/HCC, was delivered on 19/12/2024, whereas PLATEFORME COMPANY RWANDA Ltd lodged its appeal on 15/01/2025, almost one month later. He argues that this is the reason why the Registrar of the Court of Appeal refused to register the appeal, as indicated in Decision No. 0001/2025/GCA/COM of 16/01/2025, paragraph 5, which was based on Article 21 of Law No. 22/2018 of 29/04/2018

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mentioned above. Therefore, he alleges that the appeal filed by PLATEFORME COMPANY RWANDA Ltd should not be admitted because it was lodged out of time. [12] Counsel for PLATEFORME COMPANY RWANDA Ltd submits that the judgment under appeal was delivered on 19/12/2024 and the appeal was lodged on 15/01/2025, meaning that the time-limits for filing an appeal were complied with, since an appeal must be lodged within thirty (30) days. He argues that the judgment appealed against is not a summary procedure case. He explains that, relying on Article 231, paragraph 4, of Law no 22/2018 of 29/04/2018 governing the civil, commercial, labor and administrative procedure, which provides that such a case must be adjudicated on the merits, it follows that it is not an urgent claim (summary procedure). Consequently, PLATEFORME COMPANY RWANDA Ltd complied with the time-limits for lodging the appeal. DETERMINATION OF THE COURT [13] Article 232 of Law no 22/2018 of 29/04/2018 relating to the civil, commercial, labour and administrative procedure provides for the following: “Any person: 1° who bears a bill of exchange; 2° who bears a promissory note; 3° who bears an unpaid cheque; 4° a creditor whose right is based on a legal commercial transaction; may request from the bailiff the seizure after assessing the authenticity of the above-mentioned documents and stating that the debt is unpaid”. Paragraph two of the same article, stipulates that the creditor must file a complaint within forty-eight (48) hours of seizure, before a competent court, for confirmation of the debt. While paragraph three of the very article reads that the seizure mentioned in Paragraph 2 of this Article persists unless it is cancelled by the court on the request of the property’s owner. The final judgement on the principal claim changes the seizure into distrain. The case is heard in the form of summary procedure. [14] Article 231, paragraphs 1 and 5, of the aforementioned Law no 22/2018 of 29/04/2018 provides for the following: “If the tenant of a house, land or other goods refuses to pay rents, the owner may request from the bailiff the seizure of movable property or other goods which belong to the tenant, found in the leased buildings and on the land, or which were removed without their consent. The final judgement on the principal claim turns the seizure into distraint if the claimant wins the case. The case is heard in the form of summary procedure. [15] Article 188, paragraph 2, of the aforementioned Law no 22/2018 of 29/04/2018 provides as follows: “The appeal is made within three (3) working days from the time the order was pronounced or from the day the parties were aware of the decision. The case also is decided within a period not exceeding three (3) days”. [16] In the judgment RCOMAA 00040/2022/CA, rendered on 23/09/2022, in BALTON CP v. NEW CENTURY DEVELOPMENT Ltd, the Court explained that after analyzing Article 188 of Law no 22/2018 of 29/04/2018, a decision on a summary procedure must be appealed within three (3) working days, counted from the date the decision was pronounced or from the date the parties were served with the decision. In other words, this three-day period starts from the date the decision was pronounced for parties present at the hearing, or from the date the decision was communicated to parties who were absent when the case was heard.

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[17] As recalled above, Articles 231 and 232 of the aforementioned Law no 22/2018 of 29/04/2018 provide that the claims seeking confirmation of a debt arising from a commercial transaction, as well as claims seeking to turn a seizure into a distraint for payment, are heard under the procedure applicable to urgent claims. This means that, although such claims are not summary proceedings in the strict sense, because they are not incidental to a principal claim, they are nonetheless heard, pronounced, and appealed within the time limits prescribed for urgent claims. [18] In relation to the present case, the case file indicates that the judgment under appeal, RCOMA 00737/2024/HCC, was delivered on 20/12/20241, and PLATEFORME COMPANY RWANDA Ltd lodged its appeal on 15/01/2025. [19] Based on Article 188, paragraph 2, together with Articles 231 and 232 of Law no 22/2018 of 29/04/2018 cited above, the Court finds that the period for filing an appeal had to start running on 20/12/2024, the date on which the decision was pronounced, with the applicable time limit being three (3) working days. Considering that 20/12/2024 fell on a Friday, it follows that the three-day working period elapsed on Tuesday, 24/12/2024, since 21/12/2024 and 22/12/2024 were weekend days. It is therefore clear that the last permissible date for PLATEFORME COMPANY RWANDA Ltd to lodge its appeal was 24/12/2024, in order to comply with the statutory appeal period. Having filed the appeal on 15/01/2025, nearly one month later, it is evident that the statutory time limit was not respected, as recalled above. Accordingly, the appeal must be declared inadmissible for having been lodged out of time. [20] Regarding the argument advanced by counsel for PLATEFORME COMPANY RWANDA Ltd that the present matter is not an urgent claim but an ordinary case, and that the appeal was therefore lodged within the proper timeframe, the Court finds this argument unfounded; since the main issue is not whether the matter qualifies as summary procedure, indeed, it does not, as previously explained, but rather whether such a claim is heard and appealed under the regime applicable to urgent claims. The Court finds that, in accordance with Articles 231 and 232 of Law no 22/2018 of 29/04/2018, claims seeking confirmation of a debt arising from a commercial transaction and claims seeking the conversion of a seizure into a distraint are heard under the summary-application procedure, which necessarily entails that appeals are lodged within the three- day (3 working days) period provided for urgent claims. [21] Counsel for MUHITTIN ISILDAK, relying on Article 111 of Law no 22/2018 of 29/04/2018 relating to the civil, commercial, labor and administrative procedure, and on Article 26 of Regulation no 01/2014 fixing the scale of fees for Advocates prays this Court of Appeal to order PLATEFORME COMPANY RWANDA Ltd to pay MUHITTIN ISILDAK the amount of four million Rwandan francs (4,000,000 FRW), consisting of three million (3,000,000 FRW) as counsel fees and one million (1,000,000 FRW) as legal costs. [22] Counsel for PLATEFORME COMPANY RWANDA Ltd submits that the amounts claimed by MUHITTIN ISILDAK as costs incurred in this case are excessive, and requests the Court to assess them at its discretion.

1 “What is evident is that although the copy of the judgment indicates that it was pronounced on 19/12/2024, the judgment was in fact pronounced on 20/12/2024 as shown in the minutes of the judgment-delivery hearing, which is also reflected in the IECMS under the section titled ‘COURT SESSIONS’.”

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[23] Article 111 of Law no 22/2018 of 29/04/2018, cited above, provides as follows: “ The claim for representation fees is an incidental claim to the principal claim aiming to repay expenses incurred during judicial proceedings. The claim for legal costs is adjudicated at the same time with the principal claim. It can also be admitted and adjudicated even if the principal claim has not been admitted.” [24] The Court finds that, since PLATEFORME COMPANY RWANDA Ltd lodged an appeal before this Court, MUHITTIN ISILDAK necessarily hired a counsel to represent him. On the basis of Article 111 of Law no 22/2018 of 29/04/2018 cited above, it is clear that MUHITTIN ISILDAK deserves to be reimbursed the advocate fee and the legal costs he claimed. However, given the nature and extent of the work performed in this appeal, the amounts claimed are excessive. In the exercise of its discretion, the Court therefore awards him five hundred thousand Rwandan francs (500,000 FRW) as advocate fee and two hundred thousand Rwandan francs (200,000 FRW) as legal costs at this level of proceedings, payable by PLATEFORME COMPANY RWANDA Ltd. III. DECISION OF THE COURT [25] Holds that the objection of non-compliance with the time limits for lodging the appeal raised by MUHITTIN ISILDAK alleging is well-founded. [26] Declares that the appeal lodged by PLATEFORME COMPANY RWANDA Ltd is inadmissible for having been filed out of time. [27] Orders PLATEFORME COMPANY RWANDA Ltd to pay MUHITTIN ISILDAK the sum of five hundred thousand Rwandan francs (500,000 FRW) as advocate fee and two hundred thousand Rwandan francs (200,000 FRW) as the legal costs at this appellate level. [28] Rules that the court fees deposited cover expenses incurred in this case.