21st Century Food Packaging Ltd Another vs Apes Industries Services International Consolidated Commercial Case 150 of 2012 2018 TZHCComD 76 26 June 2018

IN THE HIGH COURT OF TANZANIA (COMMERCIAL DIVISION) AT DAR ES SALAAM CONSOLIDATED COMMERCIAL CASES NO. 150; 151 AND 152 OF 2012 1. 21* CENTURY FOOD AND PACKAGING LIMITED...... 1st PLAINTIFF 2. A-ONE PRODUCTS & BOTTLERS LIMITED..................... 2 nd PLAINTIFF VERSUS ALPES INDUSTRIES SERVICES INTERNATIONAL ..................... DEFENDANT JUDGMENT Date of the Last Order: 22/06/2018 Date of the Judgment 26/06/2018 SEHEL. J. This is a judgment on three consolidated Commercial Cases that deals with supply of machines. These three consolidated cases are:- (1) Commercial case No. 150 of 2012 where by A-One Products and Bottlers Limited (the Plaintiff) sued Alpes Industries Services (the Defendant) for breach of contract. The Plaintiff therefore claims against the defendant payment of USD 70,358 being money extended to the defendant for purchases of MAHEY - Abottle Hot Filling and Sealing Machine and expenses incurred for repairs, transport and accommodation of the engineers. The Plaintiff is also claiming for interests, general damages; and costs of the suit. (2) Commercial Case No. 151 of 2012, the plaintiff (21st Century Food and Packaging Limited) sued Alpes Industries Services (the defendant) for breach of contract. The plaintiff claims for payment of USD 27,000 being monies extended to the defendant for purchase of Automatic Packaging Machine for Sugar Bags. It is also claiming for interest; general damages; and costs of the suit. (3) Commercial Case No. 152 of 2012, the plaintiff, 21st Century Food and Packaging Limited is claiming against 2 Alpes Industries Services (the defendant) a total sum of USD 40,000 being monies paid to the defendant for purchase of Powder Milk Packaging Machine and expenses incurred by the Plaintiff in paying for repairs, transportation and accommodation for engineers. The plaintiff is also claiming for interests, general damages and costs of the suit. Generally, the plaintiffs are claiming for USD 132,000 being price for machines; USD 3,500.00 being professional fees paid to M/s Tech - E-Solutions Ltd; and USD 1,858.00 being travelling, accommodation and upkeep of Tech-E-Solutions experts. In the pleadings, the plaintiffs stated that by agreements made orally and partly by invoices in 2004, the defendant agreed sell to the plaintiff and the plaintiff paid the full prices for the purchases of the machines. It is further stated that the said machines were duly supplied but upon their installation they were found to be defective and could not perform so the defendant was notified as according to the sale agreements the defendant would provide after sale 3 services and mechanical repairs but the defendant failed to provide after sale services and mechanical repairs and /or incur the costs of making such repairs but the defendant failed to provide the same. The plaintiff pleaded that due to the defendants failure, in 2012 the plaintiff employed M/s Tech-E-Solutions Ltd of Kenya to do necessary repairs and adjustments to the machines and the costs of such work were fully paid by the Plaintiff's sister Company, Mohamed Enterprises Tanzania Limited, which was dealing with the defendant from the beginning of the contract for supply of the machines. It is further pleaded that in the course of their assignment M/s Tech-E-Solutions presented its reports which show that the machines are seriously defective and below standards such that they remained idle since their commissioning. The defendant categorically denied all the allegations and placed the responsibility of repairing to the plaintiff as the plaintiff refused and/or excluded to pay the costs for installation and commissioning. The defendant averred that the machines were supplied free of any technical error or malfunction defects as thq machines were fully inspected prior Shipment by an internationally accredited company, Mssrs Cotecna, and a clean report was issued there from. It was also averred that there was neither express nor implied terms that the defendant shall provide after sales services. The defendant also raised a defence of time limitation in that the machines were delivered in 2004 but the suit was filed after a lapse of more than nine years. After all preliminary issues be concluded, the suits went through mediation and on 4th June, 2014 it was marked as failed and counsels were directed to file the witness statements. The plaintiffs filed two witness statements of Gulam Abbas Hasanali Fazal Dewji and Nasendra Champsi Sheth, in three sets, each set for each case while the defendant filed one witness statement of Benard Duchartel, also in three sets. Rule 56 (1) of the High Court (Commercial Division) Procedure Rules, GN 250 of 2012 (hereinafter referred to as "the Rules") require any party who intends to rely on a witness statement to cause the attendance of its witness. In this suit it was only the plaintiff who managed to parade its two witnesses. The defendant, despite being granted several chances to bring its witness, failed to do so. Consequently on 21st day of May, 2018 when the suit cam e for hearing of the defence case, counsel Kariwa representing the defendant, prayed to the court that “ Let judgment be composed on the basis of available evidence’. The prayer was not objected by counsel Lamwai who appeared to represent the plaintiffs. It is trite law that where a party fail to bring its witness for cross examination then the court shall strike out the witness statement from the record, unless the court is satisfied that there are exceptional reasons for the witness’s failure to appear (See Rule 56(2) of the Rules). It is unfortunate that the Rules did not give guidance as to what constitutes "exceptional reasons". Failure to appear due to illness, accidents or death may be one of those exceptional reasons. In the matter at hand, the failure of the defendant's witness was neither associated with illness, accident nor death. It was due to non­ availability of the witness who is said to be outside the country. The witness, as I said, is Benard Duchatel, a director of the defendant. He is duty bound to make a follow up of his case but he opted not to do so. I therefore, take that non-appearance of the defendant's witness was due to unwillingness of the witness to enter appearance for cross examination which cannot be taken as exceptional circumstances. My reasoning is further fortified by Sarkar on Evidence, Volume 2, 15th edition reprinted in 2001 at page 2170 where it provides:- ".... Death or illness before cross examination makes the evidence in chief admissible though its weight may be slight [R Vs Doolin, Jeb b CC 123; People Vs Cole 48 NY 508]. But absence from the country [Bringley Vs Marshall, 6LT 682]; or temporary illness [Nason Vs Clamp WR 973], has been held insufficient............". It follows then that i have no other option than to strike out the witness statement of Benard Duchatel filed to this court on 17th da^ of June, 2014 from the Court record. Having striking out the witness statement then I will have to determine as to whether the Plaintiff proved their case on the preponderance of probability as required by Section 3(2) of the Evidence Act, Cap. 6. Four issues were framed by this which the Plaintiffs are required to prove. The issues framed are:- (T) Whether in the contract of sale of the machines there was a term regarding installation, commissioning and the supply of after sale services. (2) Whether the cause of action is time barred. (3) If the answer to issue number two is in the negative, whether there was a breach of the term of the agreement. (4) To what reliefs are parties entitled. I prefer to start with the second issue, that is whether the suit is barred. The dermination of this issue is pertinent as it goes to the root of jurisdiction of this courts The defendant in its amended written statement of defence alleged that the plaintiff’s suit was filed out of time since it was filed after a lapse of nine years from the date the machines were delivered in 2004. The plaintiffs on the other hand, in their rejoinder, averred that the Suit was filed within time. The argument raised by the defendant is based on the position of law, most specifically, item 7 of Part I of the schedule to the Law of Limitation Act. Cap. 89 that categorically requires for a suit based on a contract to be filed within a period of six years from the date of its accrual of right. When then did the accrual of right in the present suit began? According to the defendant’s defence, the accrual of right was in 2004 when the machines were delivered. The date of delivery of machines is not disputed by Narendra Champ si Sheth (PW1) and Gullam Abbas Hassanali Fazal Dewji (Pw2). They however testified that the defendant in January, 2012 commissioned the services of Tech-E-Solutions Ltd engineering company based in Kenya after the plaintiff’s made several attempts for the machines to be repaired Section 7 of the Law of Limitation Act, Cap 89 provides:- “where there is a continuiring breach of contract or continuing wrong independent of contract a fresh period of limitation shall begin to run at every moment of time during which the breach or the wrong, as the case may be, continues”. From the testimonies of Pwl and Pw2, it is obvious that a new fresh period of limitation started to run, that is, from January, 2012 when the defendant commissioned Tech-E-Solutions Ltd. Counting from January, 2012 to December, 2012 when the present suit was filed, about eleven months have elapsed. Therefore the suit is well within the six year period. It is not time barred. Having resolved the issue of time limitation, let me now deal with the issue as to whether there was a term of installation, commissioning and after sale services in the contract of sale of the 10 machines. This issue depends wholly on the facts and evidences brought before the court. It is not disputed by both parties that there was a contract of sale of machines between the Plaintiffs and defendant. This contract of sale of the machines according to the testimonies of Pwl and Pw2 is contained in the pro-forma invoices and invoices which were tendered by Pwl and admitted as Exhibits P2;P3;P6;P7;P8 and P10 in his cross examination further explained that issue of installation and commissioning is covered in email communications which were also tendered by Pwl and admitted as Exhibit PI 1. In their statements, Pwl and Pw2 testified that after a repeatedly follow up with the defendant to make repairs of the malfunctioned machines, the defendant, in January, 2012 Commissioned and fully paid Tech-E-Solution Ltd to undertake repairs and adjustments to the machines. They further testified that Tech-E-Solutions issued its report in 3rd March, 2012 which was tendered by Pw2 and admitted as Exhibit P5, li Section 3(3) and (4) of the Sale of Goods Act, Cap. 214 provides:- " (3j where under a contract of sale the property in the goods is transferred from the seller to the buyer; the contract is sailed a sale; but where the transfer of the property in the goods is to take place at a future time or subject to some condition to be fulfilled after the transfer, the contract is called an agreement to sell”. (4) An agreement to sell becom es a sale when the time elapses, or the condition are fulfilled, subject to which the property in the goods is to be transferred". It follows then the contract entered between the plaintiff and defendant is an agreement to sell machines with condition of commissioning, installation and after sale services. My holding is further fortified by email correspondences of Andrew Sieley dated 24th April, 2012 to ad@metl.net that reads in part as follows;- 12 "........ Please find attached our report for works done on the Sugar packing equipm ent we have been paid for the first visit by Alpes. However, for most recent visit we have not received payment........................” The reports issued by Tech-E-Solutions dated 3rd March, 2012 and 29th March, 2012, admitted as Exhibit P5 show that they are reports for control system commissioning by Alpes Industries Services International Ltd done by Tech-E-Solutions Ltd in that respect the first issue is answered in the affirmative that the contract of sale of machines contained a term of installation, commissioning and after services. Let me now turn to the third issue that is whether the defendant breached the term of the agreement. The breaches which the plaintiffs allege in their pleadings are supply of defective machines, failure to repair defective machines in time and refusal/neglect to compensate the plaintiffs for damages suffered. 13 It was the testimonies of Pwl and Pw2 that the machines were supplied in 2004 but they never functioned. They further stated that though they notified the defect to the defendant but the defendant took time to respond. It responded in 2012 by commissioning Tech-E- Solutions Ltd who performed their investigation and made several recommendations to the defendant as per their reports (Exhibit P5) but the defendant neglected to make good the machines. It is further the testimonies of Pwl and Pw2 that the expenses for repairs including travelling and accommodation expenses for Tech-E- Solutions Ltd were paid by the plaintiff's sister company Mohamed Enterprises Tanzania Limited who was involved with the initial negotiations with the defendant. Section 29 of the sale of Goods Act, Cap 214 provides that it is the duty of a seller to deliver the goods, and the buyer to accept and pay for them, in accordance with the contract of sale. I have found herein that the defendant had an obligation to install, commission and conduct after sale services. In the case at hand there is a clear evidence that the defendant supplied defective 14 machine and failed to conduct after sale services in time. Exhibit P5 dated 29th March, 2012 shows that Sugar Packing Machine had incorrect heating element and Tech-E-Solutions recommended for spares to be procured for correct jaw operations and heat sealing and that commissioning of Milk Powder Machine to be done in a later date. With all these recommendations, Pwl and Pw2 testified that the defendant neglected and refused to take responsibility to either repair the same or repay the plaintiff’s monies. I am therefore satisfied that the defendant breached the terms of the agreement. Issue number three is thus answered in the affirmative. To what reliefs are the Plaintiff’s entitled? The Plaintiffs are asking for:- (1) Payment of USD 269,358 as specific damages. The plaintiffs have proved that they paid the defendant USD 132,000 for purchase of machines through invoices (ExhibitsP2;P3;P6;P7;P8; and P10). Also through import declaration (Exhibit PI). Further through various email correspondence (Exhibit PI 1) the plaintiffs prove that they 15 paid Tech-E-Solution USD 3,500 as professional fees and USD 1858 as travelling and accommodation for Teh-E- Solutions Ltd. In that respect the plaintiffs are entitled for payment of USD 137,358. (2) The plaintiffs also claim of interest on the principal amount at the commercial rate. Emanating from what I have determined in respect of the claims on specific damages then the plaintiffs are also entitled to interests on the principal amount which amount was unnecessary withheld by the defendant. The plaintiffs are therefore awarded interest rate of 7% per annum on the principal sum of USD 137,358.00from 2004 till date of judgment. (3) The defendant is claiming for general damages which I decline as no evidence have been brought forward to establish how the plaintiffs suffered this damage. (4) The plaintiffs are also awarded interest rate of 7% per annum on the decretal sum from the date of this judgment till full satisfaction of the d e c re e (5) The defendant is condemned to pay costs of the suit to the plaintiffs. In essence, judgment and decree is hereby entered in favour of the plaintiff as follows:- 1. Defendant to pay Plaintiff USD. 137,358.00 being principal amount; 2. Defendant to pay Plaintiff interest on USD. 137,355.00 at a rate of 7% per annum from 2004 to date of judgment; 3. Defendant to pay Plaintiffs interest on the decretal amount at the Court’s rate of 7% per annum from the date of judgment to the date of final and full satisfaction of the decree; and 4. Defendant to pay Plaintiffs costs of the suit which shall be taxed. It is so ordered. 26th day of June, 2018 17