adella stanslaus assey ta mount kibo phamarcy 2012 vs vodacom tanzania public ltd company and another 2023 tzhc 22054 20 october 2023

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA

MOSHI DISTRICT REGISTRY

AT MOSHI CIVIL CASE NO. 8 of 2023 ADELLA STANSLAUS ASSEY t/a MOUNT KIBO PHAMARCY 2012…………………………...PLAINTIFF

VERSUS VODACOM TANZANIA PUBLIC LTD COMPANY… 1ST DEFENDANT NMB BANK PLC ……………………………………….. 2ND DEFENDANT

RULING 19/09/2023 & 20/10/2023 SIMFUKWE, J. In this ruling the court has been called upon to determine the preliminary objections raised by the 1st defendant. The 1st defendant raised the following preliminary objections on point of law that: i. To the extent that the plaintiff alleges to be the 1st defendant’s subscriber under telephone number 0754 482727, and claims breach of contract against the 1st Defendant due to the alleged illegal SIM Card swap as stated at paragraph 4, 9 and 10 of the Plaint, this 1 Honourable Court lacks subject-matter jurisdiction to try the matter pursuant to Regulation 5 (4) and 11 (4) (8) of the Electronic and Postal Communications (Consumer Protection) Regulations G.N No. 61 of 2018. ii. To the extent that the Plaintiff claims to be the holder of the alleged bank accounts with the 2nd Defendant and seeks for compensation for the alleged illegal withdrawal of a total amount of TZS 28,462,078.58/- through internet banking from her accounts with the 2nd Defendant, as stated at paragraph 5, 6 and 11 of the Plaint, this Honourable Court lacks subject matter jurisdiction to try the matter pursuant to Regulations 35(a) (c), 42 and 51(1)(a)(b) of the Bank of Tanzania (Financial Consumer Protection) Regulations, GN 884 of 2019. Briefly, as captured from the pleadings, the plaintiff herein instituted a case against the defendants claiming illegal sim swap

and loss of funds from her bank accounts to the tune of Tshs 28,462,078.58/=. In their Written Statement of Defence, the 1st defendant raised the above noted grounds of objection which the court ordered to be argued by filing written submissions. The plaintiff was represented by Ms. Patricia Eric, learned counsel and the 1st defendant was represented by Mr. Gaspar Nyika learned counsel. 2 In support of his first ground of objection that this court lacks jurisdiction to determine telecommunication services complaints; the learned advocate submitted to the effect that telecommunication services are regulated by the Tanzania Communications Regulatory Authority (TCRA) under Electronic and Postal Communications Act, 2022 (EPOCA), Tanzania Communications Regulatory Authority Act, 2017 (TCRA Act) and Electronic and Postal Communications (Consumer Protection) Regulations, 2020 (EPOCA Consumer Regulations). Disputes which arise from the services are regulated by the noted laws. Mr. Gaspar went on to submit that according to Part VIII of the TCRA Act, all complaints and disputes against the supplier of regulated services must be resolved in accordance with the procedures for resolving complaints provided by the Act. He made reference to section 43(1) of the TCRA Act and argued that the procedures provided under the Act apply to all complaints and/or disputes related to the communication

services. That, according to regulation 5(4) of the EPOCA Consumer Regulations any claim for compensation, refund or any other arrangement arising from breach of contract of electronic communication services shall be filed with the TCRA. That, electronic communication service is defined under section 3 of EPOCA to mean any service the purpose or effect of which is to enable or facilitate electronic communication. 3 Mr. Gaspar submitted further that, according to section 11(4)(8) of EPOCA Consumer Regulations, the complaint/dispute should be lodged by the consumer to the electronic communication service provider within 6 months. If aggrieved with the decision thereto the complaint should be lodged at TCRA by filling prescribed form and the complaint should be entertained by the TCRA within sixty (60) days from the date of hearing. That, the TCRA may award the following reliefs: costs, refunds and other reliefs as may deem necessary and reasonable. A party who will be aggrieved by TCRA’s decision is entitled to appeal to the Fair Competition Tribunal within twenty-one days in terms of section 45(2) of the TCRA Act. Having established the law in respect of procedures and forum for determination of complaints/disputes arising from provisions of the regulated electronic communication services, the 1st defendant’s advocate contended that, the plaintiff’s claim is based on

customer relationship with the 1st defendant and the provisions of electronic communication services. That, under paragraph 4, 9 and 10 of the Plaint the plaintiff alleges that the 1st defendant’s subscriber under the Telephone number 0754482727, and claims further that the 1st defendant illegally swapped her Sim Card. From the plaintiff’s claims, Mr. Gaspar believed that the same are purely based on the service provided by the 1st defendant, which are the electronic communication services regulated under TCRA Act, EPOCA and EPOCA Consumer Regulations. In that regard, Mr. Gaspar asserted that, the plaintiff’s 4 claim which is related to the alleged illegal Sim Card Swapping of his number, ought to have been filed with the TCRA in accordance with the procedures elaborated above and not before this court. On the second ground of preliminary Objection, Mr. Gaspar was of the view that this court has no subject matter jurisdiction to entertain this matter as financial services are regulated by the Bank of Tanzania under Bank of Tanzania Act, No. 04 of 2006 and Bank of Tanzania (Financial Consumer Protection) Regulations G.N 884 of 2019. He averred that, according to Regulation 42 every consumer dissatisfied or aggrieved with the conduct of the financial services provider has a right to file a complaint in accordance with the procedures provided under the Regulations. That, every

consumer who is dissatisfied or aggrieved with the conduct of the financial services provider has a right to file a complaint to the Bank of Tanzania if there is no response from the financial services provider or dissatisfied with the decision of the financial service provider in accordance with regulation 51(1)(a) and (b) of the BOT Consumer Regulations. From the plaintiff’s plaint, it was observed that the claims against the 2nd defendant are based on alleged consumer relationship with the 2nd defendant. Under paragraph 5, 6 and 7 of the Plaint, the plaintiff claimed to own several bank accounts at the 2nd defendant’s bank and requested for internet banking services of the 2nd defendant. Also, at paragraph 11 the plaintiff claimed that a total amount of Tshs 28,462,078.58 was illegally stolen and withdrawn from her bank 5 accounts. The said claims appear to be based on the protection of the consumer’s assets. The learned advocate continued to state that under section 35(a)(c) of the BOT Consumer Regulations, the law requires the 2nd defendant to safeguard the consumer’s assets and in case of any loss incurred through fraud, the Financial Service Provider is liable for the loss and refund a consumer the actual amount lost due to fraud unless the loss has been caused by the consumer’s own negligence or fraudulent behaviour. The learned advocate believed that the plaintiff’s

claims fall on protection of the Consumer’s assets which are covered under Part VII of the BOT Consumer Regulations. Thus, the plaintiff ought to have followed the procedures set out in the BOT Consumer Regulations in resolving the complaint and not recourse to this Court. Reference was made to the case of Riziki Mwitu Kiondo & 28 Others vs Vodacom Tanzania PLC and others, Civil Case No. 153 of 2020 (HC) and the case of Salim O. Kabora vs Tanesco Ltd and others, Civil Appeal No. 55 of 2016 and the case of Tanga Cement Public Company Ltd vs Fair Competition Commission, Civil Application No. 10 of 2018 (CAT) which concern jurisdiction of the court. He insisted that, it is settled law that where a certain law provides for a specific forum to deal with a certain dispute, a resort to it first is imperative before one seeks recourse to court. Where that is not 6 observed, the court’s decision is rendered a nullity. The learned counsel recited the case of Salim O. Kobora v, Tanesco Ltd and Others (supra) at page 19 last paragraph. Mr. Gaspar concluded that, this court has no jurisdiction to entertain this matter and the only remedy is to strike out the same with costs. In reply, on the outset Ms Patricia informed the court that both defendants have been sued for negligence and breach of contract jointly. That, both defendants’ facts should be ascertained by the level of negligence and

breach of their contract. Also, Ms. Patricia observed that one defendant’s contribution towards the plaintiff’s loss of money cannot be determined in isolation of the other. She explained that, as per paragraph 9, 10 and 11 of the Plaint had the 1st defendant’s agent in Mwanza not legally swapped the plaintiff’s sim card and have her duplicate number on a different devise, then the plaintiff’s email account would not have been accessible via the established two steps/dual factor authentication. She said that the defendants’ contribution towards Plaintiff’s loss of money are well listed under paragraph 15 and 16 of the plaint. Also, Ms. Patricia informed the court that in the defendants’ WSD each defendant throws the ball to the other to avoid any kind of liability towards the plaintiff’s loss of money. She argued that, the only way to determine this matter fairly and thoroughly is by having both parties be heard together. 7 Despite agreeing with the 1st defendant that disputes and complaints related to telecommunication services should be resolved with the procedures laid down under section 43(1) of Tanzania Communications Regulatory Authority Act, 2017 read together with Regulations 11(4) and (8) the Electronic and Postal Communication Act, 2020; she disputed the allegations that this suit falls under the above stated provisions because of the following reasons: First, the 2nd

defendant’s matter is not covered by the TCRA Act and EPOCA Consumer Regulations since the 2nd defendant is a financial Institution. Second, the said TCRA Act and EPOCA Consumer Regulations have not covered disputes/complaints relating to both electronic communication services and financial services like the present. Third, there is no way this matter can be determined without hearing both defendants together because the plaintiff’s claims against them are both jointly and severally. From the above observation, Ms. Patricia was of the opinion that considering the nature and the claimed amount by the plaintiff, the only neutral court seized with jurisdiction to try and determine this matter is the High Court which is vested with inherent and unlimited jurisdiction to determine all civil matters. She supported her contention by citing section 2(1) of the Judicature and Application of Laws Act, Cap 358 R. E 2019 and Article 108(2) of the Constitution of the United Republic of Tanzania, 1977. 8 On the second objection on the procedures which ought to have been followed by the 2nd defendant, Ms. Patricia stated that the BOT released Guidelines for Banking Consumer Complaints, 2016. That the Guidelines are made under section 71 of the Banking and Financial Institutions Act, No. 5 of 2006 and they are to apply to Banking Institutions and consumers as per Guideline 3 of the

said Guidelines. The learned advocate referred to Guideline 12 of the Banking Consumer Complaints, 2016 which set up the pecuniary jurisdiction of the complaint desk, which provides that: “The desk shall handle complaints whose total monetary value in respect of both the claim amount and remedy to be awarded does not exceed fifteen million Tanzania Shillings (TZS 15,000,000,000/=).” From the above guideline, Ms. Patricia submitted that the plaintiff’s claim in this suit is TZS 958,629,425.6/= and the actual money stolen by cyber theft is TZS 28,462,078.5. Thus, in either way the complaints desk has no pecuniary jurisdiction to entertain this matter. Ms. Patricia continued to explain that, assuming without accepting that the actual total monetary value in both claims and the remedy was within the desk’s pecuniary jurisdiction, still the said Desk would not be able to entertain the suit because there is another party, thus, the 1st defendant who is not a financial service provider and hence, cannot be entertained 9 by the complaint desk as the said law again does not provide room where the complaint involves other parties who are not financial service providers. In her final remarks, the plaintiff’s advocate submitted that this court is the only court with the proper jurisdiction to entertain this matter fairly and conveniently as it is the only forum which according to the

established laws and principles has the power to entertain this matter and accommodate both parties whose disputes resolution forum differs. She opined that, in the event this matter is not heard by this court, the plaintiff’s rights will be prejudiced. She prayed the two preliminary objections raised by the 1st defendant be dismissed with costs and the matter be heard on merit. In his rejoinder, the learned counsel for the 1st defendant noted that the plaintiff’s advocate did not contest the submission that where a certain law provides for a specific forum to deal with a certain dispute, a resort to it first is imperative before one seeks recourse to court. In the absence of any response to that part of the submission, their submission is taken to have been accepted. Responding to the arguments that facts from the defendants need to be determined jointly, the learned counsel for the 1st defendant replied that, the plaintiff’s submission is misconceived. That, the court’s subject matter jurisdiction is not determined by looking at the convenience of suing the 10 defendants together but rather what is the subject matter of the suit. He reiterated that this court has no jurisdiction to determine the matter. Countering the submission that the 2nd defendant is a financial institution which is not covered by TCRA Act, EPOCA and EPOCA Consumer Regulations, the 1st defendant’s counsel

submitted that, in determining the subject matter jurisdiction of the Court, what is considered is solely the subject matter of the suit itself and nothing else. That, it is the law that provides the procedures based on the nature of the subject matter. The learned advocate also disputed the argument that there is conflict of jurisdiction and none of the bodies are seized with powers to entertain matters of this nature. He reiterated his submission in chief and said that the plaintiff cannot invoke the provision of section 2(1) of the Judicature and Application of Laws Act while the law provides that disputes regarding electronic communications services should be handled by TCRA. He continued to state that, Article 108 of the Constitution and section 7 of the CPC confers the High Court with general jurisdiction except for matters which its jurisdiction is expressly ousted like the matter involving disputes over electronic communications services of financial services. He cemented his argument with the case of Salim O. Kobora (supra) at page 24 and 25 where the Court of Appeal stressed that: “Much as we appreciate that the High Court retains its inherent powers to try all civil suits as mandated by the Constitution, in the 11 present case, it is plain that its jurisdiction, as rightly found by the learned judge, is impliedly ousted and the mandate to deal with the dispute is

specifically vested to the EA and EWURA Act.” Responding to Guidelines 12 which set the limit of Tshs 15,000,000/= as pecuniary jurisdiction of the complaint desk, he submitted that the BOT (Financial Consumer Protection) Regulations were made under section 70(1) of the Bank of Tanzania Act, 2006. That, the Bank of Tanzania Act prevails and has overriding effect over other laws in respect of powers and functions of the Bank of Tanzania that contradict with it. He cited section 68 of the BOT Act to buttress his point. He added that, the Banking Consumer Complaints Guidelines, 2015 were issued under section 71 of the Banking and Financial Institution Act and it provides a conflicting procedure in relation to handling of consumer complaint with the Bank of Tanzania including the Forms to be used in lodging the Complaint with the Bank of Tanzania. He gave an example of Form No. 1 under the Guidelines which conflicts with the Complaint Form under the third Schedule of the Bank of Tanzania (Financial Consumer Protection) Regulations, GN 884 of 2019. Therefore, the provisions of the Financial Services Consumer Regulations prevail and does not set the pecuniary limit to entertain disputes at the Bank of Tanzania. Concerning the issue that the Bank of Tanzania cannot entertain the matter because the 1st defendant is not a financial service provider, Mr. Gaspar replied that the yardstick

is the nature of the plaintiff’s claim and 12 not parties thereto. He recited the case of Riziki Mwitu Kiondo and 28 Others (supra). Having heard the submissions for and against the raised objections, the issue for determination is whether the objections raised have merits. I will discuss the grounds of objections jointly. Briefly, Mr. Gaspar’s arguments are centred on the allegations that the matter has been filed before this court prematurely, without exhausting other prescribed remedies. He argued that, settlement of telecommunication services disputes and financial services complaints should be filed with TCRA and BOT respectively. Mr. Gaspar exhausted the laws which require aggrieved parties to seek redress from the said institutions. In her reply, Ms. Patricia clarified that the defendants were not sued separately. Thus, their contribution towards the loss cannot be determined in isolation of the other. Despite agreeing with the mechanism provided for resolving disputes by the law as cited by Mr. Gaspar, Ms. Patricia did not agree with the fact that this court lacks jurisdiction. She was of the view that this court is the neutral organ to determine the matter. According to the submissions of the learned counsels of both parties, it is my considered opinion that, it is not disputed that there are procedures and forum for dealing with disputes in respect of the first

defendant and the second defendant as rightly submitted by Mr. Gaspar. That, the dispute or complaint in respect of telecommunication services should be filed to TCRA while complaints in respect of financial service providers 13 ought to be referred to the specific service provider. If dissatisfied, the consumer should file the complaint to the Bank of Tanzania. I will reproduce the respective provisions of the laws for ease reference. Regulation 5(4) of the EPOCA Consumer Regulations provides that: “(4) Any compensation, refund or other arrangements which may be applied where the contract is breached or quality service parameters are not met, along with the procedures and methods for resolving disputes in respect of the service contract shall be filed with the Authority.” In respect of the 2nd defendant, Regulation 42 of the BOT Consumer Regulations provides that: “42. Every consumer shall have the right to file a complaint against a financial service provider upon dissatisfaction or being aggrieved by the conduct of the financial service provider contrary to the manner set out in these Regulations.” Also, regulation 51(1)(a) and (b) provides that: “51.- (1) Subject to regulation 49(1), a complainant may file a complaint with the Bank if- 14 (a) the complainant has not received a response from the financial service provider as required under regulation 46 or his complaint has

not been attended to in the manner provided under such regulation: Provided that a complaint shall be entertained in the case of non- receipt of notification under regulation 49(1) or the non- attendance to a complaint, at any time immediately upon the lapse of time of determination as stipulated in the First Schedule, but in any case, not later than fourteen days: (b) the complainant is dissatisfied with the decision of a financial service provider: Provided that a complaint shall be entertained in the case of dissatisfaction with the decision by the complainant, if it is lodged within fourteen days from the date of receipt of notification of the resolution referred under regulation 49(1).” Based on the above cited provisions, it goes without saying that this matter has been preferred before this court prematurely. I am of the firm view that if the plaintiff had exhausted the above laid down procedures by referring the dispute to the respective institutions, determination of the dispute by this court would be simplified. It is trite law that procedures are maidens of justice. It is for that reason that the above noted procedures were prescribed. 15 I agree with Mr. Gaspar that the yardstick of determining the jurisdiction of this court in this matter is the nature of the claim and not parties thereto. Apart from that, it is settled principle that jurisdiction of the court is a

creature of statutes and it cannot be assumed by parties. According to the factual background of this matter, the inherent original jurisdiction of this court has been ousted. Section 68 of the Bank of Tanzania Act (supra) and the case of Salim Kobora (supra) cited by the learned counsel for the 1st defendant, are relevant. In the upshot, I hereby uphold the raised preliminary objections and strike out this suit forthwith. No order as to costs. It is so ordered. Dated and delivered at Moshi this 20th day of October, 2023. X S. H. SIMFUKWE

JUDGE Signed by: S. H. SIMFUKWE 20/10/2023 16 17