achelis tanganyika limited vs jiangxi geo engineering group corp 2022 tzhccomd 248 16 august 2022

IN THE HIGH COURT OF TANZANIA (COMMERCIAL DIVISION) AT DAR ES SALAAM. COMMERCIAL CASE NO. 43 OF 2022 ACHELIS (TANGANYIKA) LIMITED………………………………………………………….PLAINTIFF.

VERSUS

JIANGXI GEO ENGINEERING (GROUP) CORP…………………………………………………DEFENDANT. RULING. Date of last Order: 26/7/022. Date of Ruling: 16/8/2022. MARUMA, J. This ruling resulted from two preliminary objections that the suit is res judicata and the suit is not maintainable in law, filed by the counsel for the respondent in this Court on May 31st, 2022, together with the written statement of defence. The matter was set for hearing on 26th July 2022. The parties were presented by Mr. Denis Mwesiga, Advocate for the Plaintiff and Mr. Hamisi Katundu, Advocate for the Defendant. 1 Submitting on the point of objection, Mr. Katundu for the respondent started with the issue that the suit is res judicata in the respect that the claim involved and the parties involved are the same as it was in the Commercial Case No. 68 of 2021, which was before this honorable Court and determined conclusively on 17th September 2021 the decree was issued. He went on to clarify that the said commercial case was determined by way of mediation whereby the settlement was reached under order XXIII rule 3 of the CPC, and the decree was passed as the law cited directs. He said it was their surprise that the same claim was brought by way of suit by the Plaintiff against the same parties, which the law does not allow, quoting section 9 of the Civil Procedure Code, Cap 33 of RE of 2019. He further informed this Court that

interpretation of the law has been interpreted this in several cases such of Emmanuel Simforian Massawe vs Attorney General, Civil Appeal No. 216 of 2019 at page 16 and page 17 which provided the elements for application of the principle of Res judicata. He pointed out that their observation was that all elements have been met in the 2 present case, so the principle of res judicata is applicable as the claim in the present suit is for the payment of TZS. 170,000,000/=, the same amount agreed in the former suit where TZS. 150,000,000/= has already been paid. He submitted that by reaching the settlement and recording the same, the decree was passed, so the matter had reached its finality and this was done by the court of the competent jurisdiction. On the 3rd element, he clarified that the parties in the former suit are the same as in the present case. Under such circumstances, it is their submission that the present suit is res judicata and so to be dismissed as we pray. On the point that the suit is not maintainable. His contention was that the matter was not legally maintainable because the previous suit was settled under order XXIII, rule 3 of the CPC. All money payable under a decree must be paid a, b, or the court may pass the decree, according to order XXI rule (1)(a), (b), and (c). Also, order XXI rule 9 of the CPC. He went on to say that the law specifies how money under

the decree must be paid and 3 that the decree holder must enforce the money owed under the decree. He insisted that in our jurisdiction, such enforcement is not by way of instituting a fresh suit as the plaintiff has done in this suit. So, he prayed that the suit be dismissed with costs. While contesting the point of objections raised, Mr. Denis for the Plaintiff opted to go directly to the issue of whether the Commercial Case no. 43 of 2022 falls under the principle of res- judicata. He submitted, after giving a brief synopsis of Commercial Case No. 68 of 2021, that while the parties in Commercial Case No. 68 of 2021 and Commercial Case No. 43 of 2022 are the same, the claims in each case are distinct based on the facts of each case. He further pointed out that the Plaintiff is tasking this court to determine between the two cases if the claim is the same or not, so to determine whether Commercial Case No. 43 of 2022 falls under the principle of res judicata. He made reference and paraphrase the content of para 3 of the of Commercial Case No. 68 of 2021 and later the content of paragraph 3 of the present case so that to bring better clarity for this Court to come into 4 conclusion on whether the suit before this Court is falling under the principle of res judicata. He submitted that by looking on the paraphrased statements therein, this court can come to the conclusion that the Plaintiffs claim against the Defendant are totally different from the following reasons: 1. The Commercial Case No. 68 after the pleadings were completed this court assigned the file to Hon. Mushi, DR for Mediation purpose which was commenced on September 2021.

2. It is undisputed the matter was settled through the mediation and the deed of settlement was drafted and signed by both parties and form the record of this court.

3. The total amount agreed in the deed of settlement by the parties was for the Defendant to pay TZS 170 million in two installments and not otherwise.

4. It is undisputed that the Defendant paid TZS 150,000,000/= on the same date of deed of settlement into account and it was agreed to pay the 2nd installment after the six months after the 1st installment which would 5 be on or before March 2022. But the Cour said on failing to pay the above-mentioned amount, the legal claim shall be once set into motion. He further submitted that it is very unfortunate that the counsel for the Defendant has failed to grasp the rationale of res judicata or to mislead this Court as explain here. He submitted that the Plaintiff filed a claim not the execution because the deed explains very clear that on failing to pay, the legal claim shall once set into motion. He paraphrased paragraph 5 of WSD in respect of the present case and clarifying that his point was on the further adhere and the Plaintiff wants the court to believe that 1st the counsel admit that the Defendant did default to pay the agreed amount. He further added that second the Plaintiff is not entitled to institute a case against the Defendant and third there was no agreement between the Plaintiff and the Defendant. He further pointed out that the senior counsel has failed to analyse the content of paragraph 4 of the deed of settlement and paragraph 4 of the decree which specifically that if to the plaint there were series of correspondence after the lapse of six months. He

added 6 that it is sadly for the Defendant to neglect or ignore the consequence after the failing to pay the 2nd instalment. He submitted that there is no single definition of the term legal claim but if you go a legal dictionary. I have found the definition of a legal claim that also in the case of Attorney General vs Sanga TLR 2022 Vol I at para 82, The Court of Appeal quoted Prof. M.P Jaine in his book titled constitution of 2004 at pg 1304 the court provide the rule of res judicata. He clarified that their argument is to whether the Commercial case No. 68 the matter was finalized or not on and whether the Defendant was complied with the terms of the deed of settlement. On the 2nd preliminary objection, he submitted that the counsel quoted order XXI rule 9 of the CPC on how to execute the decree. He submitted that their prayer is that the counsel for the Defendant is not obliged to detect terms as to whether the Plaintiff shall institute the claim against the Defendant by claiming the 2nd instalment or not because the counsel of the Defendant ought to be understand very clearly specifically of clause 4 of the decree 7 which was crafted and that was the reasons the Plaintiff knocked the doors of this Court to claim what is called a legal claim. Therefore, the plaint before this court and that in Commercial Case No.68 of 2021 are totally different as to the facts thus the suit

before this court is not fall under the principle of the res - judicata. Making a rejoinder, Mr. Katundu responded the arguments made that the counsel for failing to grasp the principle of res judicata, referred the quote in the case of Sanga (supra) which is also cited in the case referred to this Court. The principle is finality should parties face the same kind of litigation twice. In that light it is no doubt that the Defendant is facing the same kind of litigation twice. He submitted that in respect of paragraph 3 in both cases and the distinction has been on the amount claimed are different as to him however, his response was that in case no. 68 the original claim was TZS 221,517,000/= which by mutual consent or settlement was negotiated to TZS 170 million. He invited the Court to go through the decree of the court where it will find the claim negotiated, the same amount being claimed 8 again in Commercial Case No.43 of 2022 and it has been clearly stated in the Plaint that the claim arises from Commercial Case No. 68 of 2021. It is per this submission that the claim in the two suits are directly and substantially the same despite the fact that the Plaintiff has been paid and admitted to receive TZS 150,000,000/=. His response to the 3rd element was that the matter was concluded when it was settled and come to an end if not the Commercial Case No.68 could proceed. He

submitted that they believe that the matter was conclusive once the decree was issued instead of relying on paragraph 4 of the decree. Thus, why the counsel did not quote such paragraph when he was requested for. He submitted that the counsel for the Plaintiff discussed in extension the content of witness statement of defence but knowing the principle of res-judicata was not that the Court should look on the plea in the WSD but the element of res judicata. On the 2nd limb. He said that the defendant is not dictating on what to do but showed what is required by the law on how to execute the money in the decree which is by way of execution. He 9 therefore prayed the preliminary objection be upheld and the suit be dismissed with costs. Having considered the counsel submissions with respect to the two preliminary objections as mentioned above. Let me begin with the facts which are not in dispute and then proceed to the issues of whether the matter falls under the principle of res judicata and whether this suit is not maintainable in law. It is very clearly pointed out and admitted by the counsel for both parties that this suit arises from Commercial Case No. 68 of 2021 and the decree on the same matter which was issued on 17th September 2021. The decree issued therein was a result of a successful mediation conducted in respect to Commercial Case No.68 of 2021 which was followed by

a deed of settlement filed in court on 17th September 2021. It is not in dispute that the parties involved in Commercial Case No. 68 of 2021 are the same parties in Commercial Case No. 43 of 2022. Furthermore, there is no dispute that the cause of action in Commercial Case No. 68 of 2021 is the same as in Commercial Case No. 43 of 2022. It is also not in dispute that the parties are in agreement with the terms in 10 the deed of settlements which was partly executed. Also, it is upon the default of the execution of the remaining part this Commercial case No. 43 of 2022 has been instituted. It arises from clause no. 4 of the decree of this Court issued on 17th September 2021 in respect to the outcome of deed of settlement entered by the parties herein in respect to Commercial Case No. 68 of 2021. In the light of the above facts which are not in dispute, let me proceed with the 1st preliminary objection of res judicata which substantially based on the understanding and interpretation of the said clause 4 of the Decree of the Court as I quote hereunder; “…That the second installment of TZS 20,000,000/= shall be paid after six months from the date of first payment on or before 13th March 2022. On failing to pay the above mentioned amount the legal claim shall once more be set into motion…” The emphasis is on the part that the legal claim shall once more be set into motion, which

gave the way to the filling of Commercial Case No. 43 of 2022. 11 The counsel’s interpretation on the "legal claim" was meant to file a fresh suit. I think the counsel for the Plaintiff misconceive the interpretation of the phrase that "legal claim shall once be set into motion.". Interpreting this phrase should not be in isolation of the other parts of the clause and the whole context of the decree arising from the deed of settlement. Reading the mind of the author together with the context of the deed of settlement, "the legal claim" to be set on motion was not necessarily meant to file a fresh suit rather than a legal process to take its cause in case of default, which include execution part of the decree. This is said so based on the issues to discussed as follows. However, appreciating the arguments made on the interpretation of the term "legal claim" by both counsel, the same has nothing to disturb the substantive and fundamental principle that the matter has been conclusively determined by the parties blessed by the Court's decree which bars the re-opening of the same matters before this Court as it lacks jurisdiction. 12 Section 7 of the CPC is very clear on the issue of cognizance that, the Court is barred from entertaining matters of cognizance either expressly or impliedly. The consequence for the same is provided under section 8 of the Code that bars jurisdiction of

the court to proceed with the matter under the circumstances provided therein, I quote, "No court shall proceed with the trial of any suit in which the matter in issue is also directly and substantially in issue in a previously instituted suit between the same parties, or between parties under whom they or any of them claim litigating under the same title where such suit is pending in the same or any other court in Tanzania having jurisdiction to grant the relief claimed." As in the present case, since it is very clearly pointed out and admitted by the counsel for both parties that this suit is arising from Commercial Case No. 68 of 2021 which was conclusively determined by way of mediation and a court decree thereon was issued on 17th September 2021. In the eyes of the law, the matter was conclusively determined as the rights of the parties were 13 determined and agreed upon amicably as per the terms of the deed of settlement signed by them. It is not also in dispute that the parties involved in the Commercial Case no. 68 of 2021 are the same parties in Commercial Case No. 43 of 2022. Moreover, as indicated in paragraph 3 of the plaint in Commercial Case No. 43 of 2022 the amount claimed against the Defendant is TZS 170,000,000/=, the same amount agreed to be paid in the deed settlement reached in regard to Commercial Case No. 68 of 2021 and reflected in item 2 of the decree

issued on 17th September 2021. It is also not in dispute that the agreed amount as per the terms in the deed of settlement in the previous case was partly executed through the payment of TZS 150,000,000/= as shown under paragraph 7 of the Plaint in the present case. Thus, it was upon the default of the payment of the remaining part that this Commercial case No. 43 of 2022 has been instituted based on clause No. 4 of the decree issued by this Court on 17th September 2022. Leading by the above facts, there is no single doubt that the matter in issue between the two cases are directly and 14 substantially the same which bars this Court to have powers to entertain this fresh suit in Commercial Case no. 43 of 2022. Coming to order XXIII rule 3 of the Civil Procedure Code, it provides that, “…Where it is proved to the satisfaction of the court that a suit has been adjusted wholly or in part by any lawful agreement or compromise, or where the defendant satisfies the plaintiff in respect of the whole or any part of the subject matter of the suit, the court shall order such agreement, compromise or satisfaction to be recorded, and shall pass a decree in accordance therewith so far as it relates to the suit…” Reading interpretation clause under the CPC (supra) the term “decree" is defines as follows; “…"decree" means the formal expression of an adjudication which, so far as regards the

court expressing it, conclusively determines the rights of the parties with regard to all or any of the matters in controversy in the suit…” 15 On the basis of the position of the law above, since the court has issued a decree based on the terms settled in the deed of settlement signed in September 2021 determining the rights of the parties. As rightly pointed out by the Defendant’s counsel, the matter at issue was conclusively determined. No matter how the clause 4 of the decree was drafted as alleged by the counsel to give a way to present this present case. Once the decree is issued on the matter at issue, it brings the suit to a finality. The decree of the Court was issued on 17th September 2021 in respect of order XXIII rule 3 of the CPC. The jurisdiction of this Court in the present case is limited to the extent stated above to entertain this suit. Also based on sections 7 and 8 of the CPC which I believe were introduced to cure mischiefs like this so to avoid confusion in the administration of justice and unnecessary conflicting decisions. As aforesaid, I am of the settled view that the two preliminary objections are of weight and touch on the fundamental issue of jurisdiction from which this court derives its power over the matter. The same is, therefore, upheld and the Commercial 16 Case No. 43 of 2022 is hereby struck out for lack of jurisdiction. Costs to follow the event. Dated at Dar es Salaam this 16th day of August 2022. Z.A.Maruma.

JUDGE 17