a8 AGES INTERNATIONAL CO

THE UNITED REPUBLIC OF TANZANIA JUDICIARY IN THE HIGH COURT OF TANZANIA MBEYA SUB-REGISTRY AT MBEYA CIVIL CASE NO. 5 OF 2022 AGES INTERNATIONAL COMPANY LIMITED.............................. PLAINTIFF VERSUS CRS TECH COMPANY LIMITED.................................................... DEFENDANT JUDGMENT Date of Last Order: 07/03/2024 Date of Judgment: 27/06/2024 NDUNGURU, J. The plaintiff, Ages International Company Limited is suing the defendant, CRS Tech Company Limited for breach of contract. It is pleaded that on 15th April 2020 the two (plaintiff and defendant) entered into a contract for the plaintiff to supply the defendant with a caterpillar Grade 140H/G and Dynapac Roller CA25D (in this case both equipment to be referred as Machines). The total price of the machines was Tanzania Shillings (TZS) 178,093,300. The agreed price was to be paid into three instalments of 35%, equal to TZS 62,332,655/=, 15% equal to 26,713,995/= and 50% equal to 89,046,650/= respectively. The 1st i instalment had to be paid within two weeks from the date of the contract which the plaintiff would have put the machines on transit. After the machines put on transit, the defendant had to pay the 2nd instalment and the last instalment had to be paid within one year after the machines being handled to the defendant. It was further agreed that the plaintiff had to handover the machines to the defendant within 40 days after the defendant completed payment in the 2nd instalment. Thereafter, it is alleged by the plaintiff that the defendant had breached the contract for failure to pay the 1st instalment while the plaintiff had already placed an order for the same machines which gave the raise of storage expenses at the tune of USD. 21,000 and that he had been threatened to be sued if he fails to settle the bill. Several reliefs have been sought, as follows: i. Declaration that the defendant breached the contract. ii. An order for payment of 237,855,898 being specific damages for breach of contract. iii. Punitive damages to the tune of Tshs. 200,000,000/= iv. Interest at the court rate post judgment v. Payment of general damage to the plaintiff. vi. Costs of the suit 2 vii.Any other relief(s) as this court may deem fit to grant. In rebuttal, through the written statement of defence (WSD) the defendant admitted to have interred into contract with the plaintiff. But denied to have breached it on the ground that it is the plaintiff who breached the contract for failure to deliver the machines despite being paid more than the amount in the 1st instalment, that is TZS 68,650,000/=. Also, that the plaintiff never put the machines on board for him to be obliged to pay the 2nd instalment. The defendant also denied the allegation of the plaintiff to have incurred expenses for pressing order from supplier and storage charges on the ground that the plaintiff declared in the contract to be the owner of the machines. In the end, the defendant prays for the plaintiff suit to be dismissed with costs and that the plaintiff be ordered to return the sum of money TZS. 68,650,000/= which has been paid by the defendant or deliver the machines. During hearing, the plaintiff has the legal service of Ms. Esther Mbogo, learned advocate while the defendant has the service of Ms. Judith Kapaga also learned advocate. Each part called one witness to establish her case. The plaintiff also tendered one exhibit, that is a contract which was admitted as exhibit Pl while the defendant tendered 3 payment receipts of different dates, they were collectively admitted as exhibit DI. At the Final Pre-trial Conference, on the parties' consensual basis three issues were framed by the court as follows: 1. What were the terms and conditions of the contract between the parties. 2. Who between the parties has breached the terms and conditions of the contract. 3. To what relief(s) are the parties entitled to. In his testimony, Tumaini Benjamin Masuka, a managing director of the plaintiff (PW1) stated that in April 2020 the plaintiff entered into contract with the defendant to supply him with machines, a motor Grader make Caterpillar 140 and Roller make Dynapac CA25D. That the machines were valued at TZS 178,000,000/=. That they agreed the amount to be paid in instalments where the first instalment had to be paid prior to the transportation of the machines at the tune of 35%, the second instalment was to be at the tune of 15% to be paid during transportation of the machines and the last instalment at the tune of 4 50% was to be paid after the plaintiff deliver the machines to the defendant. That the first instalment had to be effected within 14 days (two weeks) from the date of signing the contract. He also stated that following the signing of the contract, the plaintiff had to purchase the machines and pay 100% of the purchasing price. Then that the interest in the contract was preserved by the defendant by depositing a title deed of a landed property located at Vwawa. That on the agreed first instalment, the defendant managed to deposit only TZS. 26,000,000/= on 03/4/2020 before signing the contract. PW1 also testified that being trusted the intention of the defendant, he outsourced the machines from the supplier and paid 50%. Then that he started dismantling the machines in the preparation for transportation. That he also paid 50% of shipment and dismantling expenses. That he had paid about TZS 100,000,000/= in the preparation. That having paid all that, the agreed two weeks lapsed without the defendant making payment than the TZS. 26,000,000/= he had deposited before. That though the defendant did not honour the contract, PW1 kept on negotiating with her and telling her the consequence of the delay including storage expenses and the 5 reassembling of the machines in case of failure to transport them and the effect of exchange rate which would affect the contract. PW1 went on testifying that, having found the defendant quite he travelled from England to Mbeya and the discount he got from the supplier was removed. That having discussed with the defendant manager they orally agreed that the defendant would pay the total amount of the contract and additional charges which made a total amount at TZS 205,000,000 from the previous agreement of TZS. 178,000,000/=. After two weeks of the oral agreement the defendant made a payment at the tune of TZS 12,000,000/= in addition to TZS 26,000,000/= paid previously, that having communicated to Solomon, manager and co-director of the defendant they had nothing promising as they alleged to have no means for they did not get money from Bank. That he returned in UK the defendant started depositing sometimes TZS 500,000/=, 3,000,000/=, or 300,000 which he came to stop him from depositing such amount which did not meet 35% of the 1st instalment. Thereafter he decided to institute the instant suit for prayers made in the plaint as listed above. In his defence evidence the defendant through Samson Robert Lanjuli, the director of the defendant testified as DW1 stated that they 6 had contract of purchasing the machines from the plaintiff. The contractual price and mode of payment was as stated by PW1. That after endorsing it, he started complying to the terms and conditions by paying the 1st instalment of 35% which was TZS. 62,000,000/=. Then that the plaintiff asked him (DW1) to continue with payment in the 2nd instalment of which he paid amount in addition to the 1st instalment making a total of TZS. 68,000,000/= DW1 also testified that he made the payments through Bank accounts of Tumaini Benjamin Masuka a total of TZS. 65,000,000/= and Joshua Thomas Mahenge who is also the plaintiff's director and representative a total of TZS. 3,650,000/=. That the payment to Joshua was done following the directives of PW1. He tendered receipts in respect of the payments, they were collectively admitted as exhibit DI. DW1 gave further evidence that the defendant fulfilled her obligation by paying the 1st instalment. It remained the plaintiff's duty to transport the machines but she did not do so. Thus that it is the plaintiff who breached the contract by failure to perform her obligation. DW1 prayed to this court to resolve that the plaintiff breached the contract also that the company entered in the contract is not the same with the 7 one suing in this suit. Also that the plaintiff be ordered to refund the money she received from the defendant. That marked the end of the defence evidence. It is now high time for this court to converse the issue as above. The 1st issue is what was the terms and conditions of the contract. PW1 give evidence on how the two entered into the agreement and tendered exhibit Pl without any objection and the exhibit was confirmed by DW1. It quite clear therefore, that parties are not at variance that the contractual price had to be paid in three instalments. It is also very clear that, the first instalment was supposed to be paid within two weeks from the date of signing the contract. Thereafter the plaintiff had to put the machines on board and then the defendant had to effect the payment of the 2nd instalment. And the 3rd instalment had to be paid up on the defendant receiving the machines. It is now the plaintiff complaint that the defendant did not pay the amount of the 1st instalment in the agreed period. While the defendant maintains that he effected the payment and was the duty of the plaintiff to transport the machines. Thus, it follows the 2nd issue of who breached the contract between the plaintiff and the defendant. I should state it outwardly that the defendant did not raise a cross suit by way of counter claim in 8 accordance with Order VIII Rule 9 of the Civil Procedure Code, Cap. 33 R.E 2022 (the CPC). It is elementary law which is settled in our jurisdiction that the court will grant only a relief which has been prayed for - see: James Funke Gwagilo v. Attorney General [2004] T.L.R. 161 and Hotel Travertine Limited & 2 Others v. National Bank of Commerce Limited [2006] T.L.R. 133. And prayers or reliefs are claimed through a counter claim not in the written statement of defence; see Melchiades John Mwenda vs Gizelle Mbaga Others (Civil Appeal No 57 of 2018) 2020 TZCA 1856 (13 November 2020) (Tanzlii). In the circumstances, this court will not be in the position to resolve any issue in respect of whether the plaintiff breached the contract against the defendant. It is thus, to resolve the issue whether the plaintiff proved her claim that the defendant breached the contract. As I have hinted in the 1st issue, and reading exhibit Pl, the terms and conditions, the agreed price had to be paid into three instalments. The 1st instalment had to be paid within two weeks from the date of signing the contract, that is on 15/4/2020. It appears the essence of the 1st instalment was to put the contract into operation. Nonetheless, it is in the evidence of both sides that the payment of the 1st instalment was 9 not effected within two weeks as per the agreement. But further evidence is that an amount equal to the 1st instalment had been paid after a lapse of more than a year. The amount paid, however, was more than the amount agreed to be paid in the 1st instalment which was TZS. 62,000,000/=. In the foregoing facts, in so far as the 2nd issue as concerned, I find it demanding to start by resolving a minor issue of whether the two weeks' time limit set in the contract was of essence. This follows the complaint raised under paragraph 12 of the plaint that following the defendant failure to pay the 1st instalment within 14 days the contract was rendered nugatory. Also, PW1 testified that the failure by the defendant to pay the 1st instalment in the agreed time amounted to breach of contract. To the plaintiff therefore, the two weeks' time in the contract was of essence. The defendant and her witness, DW1 did not refute on the other terms. She did not also say if she paid the 1st instalment within the agreed timeframe. But, he testified that, the plaintiff and his manager continued to receive the money in respect of the 1st instalment and added another for 2nd instalment even after the lapse of two weeks. io The essence of time in contracts is provided under section 55 (1) of the Law of Contract Act, Cap. 345 R.E 2019. It provides that: "55.-(l) When a party to a contract promises to do a certain thing at or before a specified time, or certain things at or before specified times, and fails to do any such thing at or before the specified time, the contract or so much of it as has not been performed, becomes voidable at the option of the promisee, if the intention of the parties was that time should be of the essence of the contract." However, fixation of the period within which the contract is to be performed, does not make the stipulation as to time of the essence of the contract until when it has been expressly or by conduct of the parties made so and an aggrieved party has to give notice to a default party showing making the time of essence. This position was well illustrated by the Court of Appeal of Tanzania in Esther Kimbulu & Other vs Piganio Mwita (Civil Appeal No. 484 of 2020) [2024] TZCA 314 (7 May 2024) (Tanzlii). It was held that: "...under the modern law in the case of contracts of all nature: 'The time will not be considered to be of essence, except in one of the following cases: 1) where the parties ii expressly stipulated that conditions as to time must be strictly complied with; 2) the nature of the subject matter of the contract or the surrounding circumstances show that time should be considered to be essence; 3) a party who has been subjected to unreasonable delay gives notice to the party in default making time of essence'." In the matter at hand, none of the above three conditions was shown in the parties' contract. It was neither expressly stipulated that time should be strictly complied with, nor the subject matter of the contract showed that time should be of essence nor the plaintiff gave notice to the defendant after she delayed to effect payment in the 1st instalment within two weeks. In the premises, I find the two weeks' time frame in the parties' contract was not of essence. In addition to the above findings and much important to the issue under consideration, is the PWl's evidence that, having the defendant failed to pay the 1st instalment in time, they (the plaintiff and defendant) entered into negotiation and the defendant continued paying. However, PW1 claimed further that in the negotiations, they had agreed to pay the contractual price in total plus other expenses. The claim was denied by 12 the defendant on the reason that she could not have paid the amount in fully while the plaintiff had not yet fulfilled her obligation of putting the machines on board. In that regard, the plaintiff having entered into negotiations with the defendant, and by conduct of continuing with receiving the payments notwithstanding the lapse of the agreed period indicated clearly that two weeks' time stipulated in the contract was of no essence. But by conduct, the plaintiff varied the terms and conditions of the contract in which she was obliged to continue with other contractual arrangements of putting the machines on board for transit where she would have started claiming the payment in the 2nd instalment of which the defendant had started paying and they had agreed to be paid when the machines are put on board/transit. In the premises, the 2nd issue is resolved negatively that the defendant did not breach the contract as she paid the amount of the 1st instalment. The 3rd issue, as to the relief(s) the parties entitled, upon found the defendant to have not breached the contract and on the reason of not raising a counter claim by the defendant, there is no relief(s) intitled to any of the parties. To make it clearer, I am abreast of the law in section 55 (2) of Cap. 345 and the holding in the case of Esther 13 Kimbuiu & Other vs Piganio Mwita, (supra) that if time is not of essence, an aggrieved party may be entitled to compensation for the loss incurred due to failure of the opposite party to fulfil the contractual obligation in time. The law stipulates that: "55- (2) Where it was not the intention of the parties that time should be of the essence of the contract, the contract does not become voidable by the failure to do such thing at or before the specified time; but the promisee is entitled to compensation from the promisor for any loss occasioned to him by such failure." Notwithstanding of the above law, for an aggrieved party to be entitled to such compensation, is duty bound under subsection (3) of the same section to give notice. In this case, the plaintiff did not give notice to the defendant showing the loss she incurred by the failure of the defendant to pay the 1st instalment timely. Again, the plaintiff strived to give evidence that she incurred loss by pressing an order to the supplier in UK and that she incurred expenses of dismantling the machines in a bid of preparing them for transportation and storage expenses. The claim of pressing order was denied by the defendant on the account that 14 the plaintiff indicated in the contract that she owned the machines in UK. Indeed, as claimed by the defendant there is neither term nor condition that the plaintiff had to press order for the machines after the defendant paid the 1st instalment. Also, with regard to the other claimed loss, the plaintiff did not specifically plead the amount of the loss nor prove the same in the evidence. Moreso, there was no notice to the defendant showing the details of the alleged loss. In the event, the plaintiff is not entitled to any relief from the defendant. Owing to the above findings, I find the plaintiff's suit lacking in merits, I thus dismissed it. Considering the business relationship of the parties, and with the view of avoiding fuelling the existing dispute, each party shall bear her own costs. It is so ordered. D.B. NDUNGURU JUDGE 27/06/2024 15