20020731 TZHC Mbeya

.... IN THE HIGH COURr _OF TA1JZA1"HA

AT MBEYA tR ;1:G Th fiL JUR L3J? ICT ION ... ·;·,· (Mpey-~ R~gistry) ,, (DC) CIVIL ,\PPE),L NO. 24 of 2001 . . l• . (Orig;i.nnl . . Th"1' Civil C0se :•::o. 23i99 . ,. of the tfi.beyaJ Resident . . Mogistr-:itet .. s. Court) •1 f CASNIR B. f,.ESSY ooeooooeooaoo•ooocaoooo .A.PPELLANT Versus . TAYLOR ~JrnCH. (T) LTD. oe•:1••oooo<>o•Oo• R]I;.SPOFDENT < ,· i ~ f ,. ., - JUOOEi'1E,.l\JT ·, .L -~ ,.. MREMA, ~• . •;. '•·1 This ·3ppc:il has stemraed from the :RM Civil Case No. 23/;1")99. ,i,n which the present Respondent T~\YWR ::!INCH (T) LlliI'i"EID,. then t~e Pl::intiff, sued CASMIJt B. KESSY, tne ·-present Appell:m't (Defend;;1nt), _for refund of balance of m;ne;v' in the sum of TaShs.8,205,4o7/= ogoinst a tot.:il sum of money Gmounting to T.Shs.53,000,000/= cash,' excluding form inputs ;in, -the form. of goods, c1dvrmced to the· ll.ppellnnt for the purch::ise of perchment, of coffee from f::,rmers. Also cl0imed ::i_r,:r;;inst the principoJ sum-is interes.t at the B,mk' s commercial rote of 30% per annum from 01.12~98 till p::1yment in full; costs of the suit; order of the sole of the collc::tertil .,. M/V., MB 4226 Toyota Hilux, 1985. '·' . The Appell-'.mt · strongly opposed 'the claim at the triDl co~,t_ wherc::it Mr. Mbise, Leorned Counsel, edvocafad for the Respondent (Pla\ntiff) and the Appellorit (Defendant) was represented by Mr. Mkumbc, Learned . ' Counsel • . In this

3ppe.il e-sch party is represented by the same Counsel. At the tri::il court two witnesses testified on beh3lf cf the Respondent Compony, whereas the Appell:mt testified himself in support of his case.• The learned tri9l Resident Magistr::,te Mr. rfaun.:i after he::iring both sides was satisfied that the Respondent - Plainti'ff had proved his case on the preponderence of evide-.ce ::ind in the res.µlt he confirmed thrit the Appellant owes the Respondent T.Shs.-8,205,407/=- as claimed in the ploint. Dissatisfied by th2t finding the Appellnnt pas eppe3led from that decision ·. to this· cOurt. · ' Five gr;uhds ·of :rppe.:H were ·filed but like: both the Le3rncd Counsel I will t3ckle them generally becnuse they are intertwined. ·. :, · At the he:iring' of this appe-31 Mro Mkumbe for the 11.ppell,:mt - Defendant (C.B- Ke~sy)· ·submitted in support of this ground to the effect thc::t Clouse •. 2 of the Agreement (Exh. Po2) docs not mence its \-lords: th3t it does not • j,, cover only money to be spent to purch.::ise p-:irchment coffee but also to cover other incidentnls arising '.1_s ::md when purchasing coffee frnm o••/2 ,.,r the farmers, which would also include overheads. On the bosis of Clause 2, ~ according to Mr. Mkumbe, the learned t.!'i-~l ~esident=·Magistr.::ite was wrong to condemn the Appellant to pr:1y Shso8~205;4o7/==, whi.ch money he hnd in fact spent to meet the

overhe.,id costs during his Agency with the Principal to purchase parchm~nt co.ffee and deliver the s::ime to the Respondent. This' cont~nt'ion·~ however'; ~:Js ~ot left to rest' peacefully •. Industriously as he is always is; the learnE?d Advocate. for' the Re~pondent hotiy .3ttacked . the 1st Appellant's ground. He objected.to the assertion that giving a libernl interpretation of Clause 2 of the· Agreement' it meant thc1t the .. Appellant as the Agent of the R6spondenf' wos to use·the money advanced to him ~s per' the Agreement not only to buy parchment coffee but also to meet other overhe::id costs~ as for instcmce-;- trdnsport expenses, payment to labourers, storage charges and other·overhJad costs. According to Mro Mbise Cl3Use 2 wns to be read together with Clause 8 of the Agreement, whereby the lntter required the, Appelltmt· tb meet such overhe3d costs from his 50/-= buying ·commission per kilogre;rnee I But this is disputed by the, opposite side on tl1e ground thnt :'buying commission:: _mentioned Gt Cl.suse 8 of the Agreement was· nothing :more· th~1n to, s3y thet it meant 11 snlary to the Agent;i. no ' ' ' · · -: · , According to ··Mr. Mbise, he knows of -=- _busine'ssma_n who does not set a limit to his• expcnditurce; -in the m<:JY?,agement of his bus:lness.i It was not 'therefo:fe possible, he ~rgecl, tl1at the.Respondent ··c~iointiff) ~ould just be so liberal Gnd

fluid to ctliow tl-le 1Appellant to· spend the Respondent I s . money advanced to the fo:emer, in nny way or manner the .ti.gent thought himself to be for his interest. He further stated thf.')t •when the Appellant signed the i'tgreement there is no doubt that· he ·understood the meaning. mid .~{feet of the;' provision· of Cl'.o!use 8 of the Agreement. The contents of exhibit P:4~ he elaborated,· ;is a further ,testimony that the ·.Appellant conceded to the reconcilfrtion of the accounts which pointed .a finger tow8rds the Appell::mt to the effect thDt h'e was' still o~·Jing to the Respondent (Plaintiff) the sum of T.Shso8,205,4o7/::., Mr. Mbise added that the evidence on record reveAled thnt the sum of Shs.8,205.LfQ?/=;, did not constitute c0sh money only, but, according to the ltppellc.nt ts evidence he w,s:s expecting" to return to the Respondent ·some balances of goods such Gs fer(ilizer, . empty gunny b::;gs, ~ . ; input ·vouchers, ·etc, given tb him by the R"espohdent to fac'ilitate the t • - "' . smooth purchasing of coffee from farmers. Wkit does Clause 2 of the Agreement (Exho P.2) stipulate? It provides:-' ; 12. The Advanced sum shall be solely used for the purpose of buying coffee and cov0ring incurred buying expenses/overheads and al_l coffee so purchased shsll be supplied exclusively to the buyer while the Agent has ony of the advanced sum 3 or other Buyer's.assets

(including,input_vouchers) . . . . ~ o'Ll.tsbnding. The l~gent :,t no time sh'.::11 lend the /~dv'1nced Sum to ::my other . ,. individm.11 .... or legBl entity·i. ' .. The "Buyer; 1 here would moon, I think, the Princip.:,l to whom the ,'\.ge'nt is . l J account::ibl~ for the use of money ::dv::mced to him to purchose ooffee from ~ . • "1 \ fr,rmers, including other ,:Jssets ,such 3S input ;ou·chers·o ~ h::ive gone through the evidence of ANTHOi\TY W,l-/.MB:CMBA (P':.J ol) the Oper~t:ion 0-ffic;er of the Respond~nt Comp:my '·- ·Tayior Hinch (T) Ltd. His interpret:-i'tion ·of Clnu~e 2 of the l\.greement (Exh~ P .2) is found in his . . -. . '. ,.. evidence in cross-exom:i.n~tion, .:is follows;- 1 ; The money ..JdV'Jncod to him did not include overhe:Jds o _ -~ __ ~uying expenses doc_s (sic;) not in,clude transport ch·,rges. 'I'h::it is tr::msport expe!18es •. Port,grnph I ' ._..._ ...... two of tho . agr-~ement (:i%h. . F ._2) . included overho::i·cts- with .;1 condition t1'1'ct it shoulµ. be deducted from his commission''., Even in re:-ex;:imim:itton P•·! .1 emph~tically stnted thot ;,the olleged overhe::ids/ 1 buying expenses wqre ~·· ' not Company's work/oblig:1tion' . ,, • Ephr~him Mwok::ibtJ.j'/ ,(P\lo2), also '.one of the employees of T.::iylor V!inch, __: 1,1-· corroboroted HJ .1 vs t"'stimony ( in cross-ex0minntion) to the effect th:1:t the ovGrhe::id costs were

insep::ir'Jble from the commission of Shs .. 50/= per • . kilogr_Jmqie nworded to the :.gent (Ii.ppelLmt) - :md ,th-:,t this w:.:is in nccordnnce with Cl~use. 8 ,'Jnd 9 of the Agreerl!ent.: In h:j.s. evidence, the :.ppellan t Kasmir Kessy• (DW li .1). admitted to h 1wo been advonced o tot::il s_·m11 of $:1S.53,000,000/= ~;Y t}~e 'Respondent Co!llp::my but, however, he strongly denied th:~t the money w:.is exclusively for the purcbpsc of coffee. He told the tri~l court thot the money, ::iccording to th; /~gre.emcr:it (Exh. P .2) , was 3lso. to cushion other incurring buying D} ~ 1 1 exp.2nd;i.tures or ov0d1e::.id costs 0 tendered Exfribit DW .1 which detDils I ,·, . out not only the sum of money and the v~lue of ., goods - :.,dv,ndad to him by Taylor Winch Compony but olso the ' expenditures from his side. ' . ·, . " f· ' According to exhibit D.1, odv:Jnces from the Respondent Comp::my comprised rl. ,,· . ...-.c::i f .C'JS h , Bu.V_,nces T o.ShSo 5 7.,Jy 0.00 , 000. / =, 1npU I,' " adv_ances'T'-• Shs ,, 3 ,0\., . . . t VOUCilGI' c.0.0 , 000./- \ . - snd .fn:rm input ndvtmces T.Sq.s.6,099,200/= - making e tot.11 of Tshs.62,699,200/=. On the ,ex1Jenditure side, the fl.ppellc:~t showed to fr::nrs.; spent T.Shs.;.?,950,8o0/=. . 1 '/ ,, to l?urch;9se coffee (the snme wns de.liv8red to t_he l1esp:.ndentvs Corrrpony), hire godown~ (K~t~mrm, I(;indete ~nd S~m,:i) for S~:.260,000/=,

employ w.:itchmen • 'I -.Ii,; nt Kntumb:i, K.-:mdete, Lwsngwa ond Suma for :=i tobl sum of T.Shs.,320,000/=, pDy sub-agents (buyers) ot rJ,,,Shs.25/= p,,k.g. (51,4o5 . . Kgm.s) rnnounting to T.,Shs.1 1 285,125/=; ;lso thnt he hired n foliow...:up or administr:itive motor vehiclG for 4 months (July .. October, 1998 inclusive) ;::it a total amoung of Shd.,4,720,000/=; further thst cne buyer (Gub-i~gent) committed - 4 suicide sfter misplacing 'l'o·Shso822,08o/= for buying coffee belonging to the Cotnpany o Also some payments in the :sum of Sbs 9195,000/= are shown to h,:ive been made to one Mwok.~ba'je, ,3 Respondent's st2ff. The Appellant's commission, 'ds 1X:T the . ~ontr.act (exhibit P o2) a1T1ounted tci T .SM o3 ,o84 ,300/:;:: . and the "\rslue of . inputs £llleg~dly . ..returned - to the Res.pondent Company amounted to T.Shs.5 1 036,4O0/=. The tot·~l expenditure, according to exhi9it, D.1, is T0Sl-iso68,673,705/=;· Thus, th<.:< emount due tc the f\ppellant is T.Sbs.68,673,705/= minus '!.'oShs.62,699,200/=. which is T.Shs.5,974,505/=. I ·' ♦ ~ • ', •. • • But the crucinl issue tha~ wcs Gt the trial co\ll't, which.is also the .. central issue. in this an\;ea1, is whether the ~l'.Shs.53,000 ,000/= adv1:inced to the ):ppel10nt. w:::s exclusively for the purpose of buying coffee as per cl-3use 2 of exhibit P o2'? The key words 2s ri"e;litly underscored in the judgement of the

t:r'ial court ,c:d_,' ,iJ..11...~. 2~'!:..~c_e..i__.?.U.;.rn, ..~J:inJ...t.Ji.e so)d;L ~~d _fo.1~!,l;l..£...J?.urDose of __ b.~~ipg_ coffo2.,;m_d c~ering_ ~T.£.~l b3ir~ ~'.l<m.\ef?/overh5-ads;: o The le3rti~d trial· Resident Magistrc:itc was right to hold. tl1at a1:, . i;1ng as ·tho wording ·constituting tho: Agreemcnt._,qf the p.~rtiE;s is quite une.quivocal it would be contr.:iry ·to infer. other.wise a,thcr than . . ; . -· , ~ . -·1 .~- . •; the ineaning ascribed -. . thereto (Clause '2 ·of the Agreement)., In this appeal, however, the Magistrate is being criticized for r0fusing to put into consider:=:tion the· 3llcged ex1'.lenditur.es shown in exhibit D.1 as being the :ioverheaqs:.-.or ' 1:i-ncurring buying expensetfi within the meaning of Cle.use 2 of the, Agreement. Th~ problem, as observed· fro'm · the ple:idings and :the .p1~qceedings, is mainly on the Appellant I s \;Jritten Statemeit of Defe_n½e ('d oS oD) • , .. Before I . go further, I apl)end hereunder· twci relevant ·paragr::iphs in the :.J eS .D. for ease: of reference on the discussion· to follow; ... , · The· defendant states th8t the plai?tiff, as p~inc_ipaH . is' in. law bou.rtd t'o indemnify t _the <iefondent. \ . . . . hi~ og.ent; .:,g,:iinst the:·.. ' consequences of all l:3wful act's done by such C _agent in the ex.ercis~- ;f 'his authority conferred upon him • . Thus, in the Laiv_ of Agency, the plaintiff cannot su~ the Defcndc:mt for the nlleged Loss· 01~ BaL:mce of Sli.s.8,20.5,407/:::: which was lawfully expended b~ the Defendant~ . .

6. Tllat _acc_ording_ to the S3id ANNI~TlffiE DA the PlsitY1,:tiff owes the ctefendant Shs.5,971+,505/= • .. The' defendrmt would have counter.,:;,cloimod this amount hsd it not b;en for l.'3ck of· f:i.ling fees . . :--Qpportur:e for this amount at an . :-:···~'..:. :·."-: ·.y tiJ!,1 8 • C • . -., -,- 5 There is no problem with porar;r~ph 3 becDuse th.3t is the:: rc•-sbtement of the: law as provided under section 174 of the::. Law of Controct Ordirnmce, P,3rt rx, on the La•11 of 1\gency o But the principal i.s lioble to indemnify the agent if it is proved thot the ogent did the business or the act in good faith, notwithstandinB that the act caused rm injury to the rights of a third person - See Section 175. But can it be ascert2incd from the ev~,J.cnce th;:::t th8 appellant, os !'.gent of the Res,Jondent's Company 1 transocted the principal 1 s business in good f::iith and according to the tei'ms of the Agreement? In his judgement the Mogis trgte doubted the flow of cxpendi tures by the Appellant as indicated in :Exhi1 ij._t Do 1 o Fcl' cx::im;:ilo h0 doubted the expenditure allegedly incurred on hiring ,q m'.:1tor-vehicle for supervision at the rnte of /Jhs .4o:,.ooo/= -per day. :'\.nd on my port, I would ~dd, if the i\gent W,'.)S p.'..lid commission of. 8hso50/= Pokg,,_~'138 the principr.il bound to meet the cc;sts for the Agent to trcJvel to the V,:=Jrious buying c:ntres in

the village? I doubt. if thot was -the principal ',s commit:nent to p,:iy commission to the Agent as well as his tr:,msport to Gnd _from the coftee buying villoges. It could be understandable if _it me::mt tr,::ms:;iort cpsts for c.'..lrrying the purchased coffee from th,e buying c.ontres to the Respondent's c.elive;y Centre. According to ,e;x:::1.ibit D1, it very cler~r.ly shows th::1t the I~ppellcmt spent 'LShs .68,,,673, 705/s Dg:.itnst the total arl.vances from the Princip.al in the surn of '.t'oShso62,699,2PO/=, hence the 8llegpd over--expenditure of I • ' .. . T .Shs.,5,974,505/::;: from ,the.. Appellant . . is . private ,source. ,. But the· Ap1;icllant (D:l .1) did not disclose how he wc;1s 2blc to niise thot amount to pay the I- . '-. ! . ~ • • . I • . . overheed costs without the ?Ssistance of the -principDl ,::md esr,0cfally on the fact that h_ea ):J.ad not b_een paid. his commissiono Secti0n 168 of Copo433 t very clearly stipuJ-8tes th-:t "If an 3gent, \vi thou~ knowledge of his principal, deals in the bu.siness of the agency, on his own nccount instead of an account of his pr_incipal 1 thE": principGl ~s entitled to claim from the agent c~ny benefit which may have resulted to him from the trons.::icti::m: 1 • On the basis of this Law it would mer:m tlwt the Appellont dc,:::tlt with his ovm ,:1ccount to spend '11 oShs o5, 974,50~/= without ,obtoining ~-?nsent of

the princip.'..ll and thr,t was contr.Jry to Gection 166. of Cc:rp.433 which states: 1 r:166. It is the duty of on agent 1 in cases of difficulty, to use nll reasonable diligence in communic~t:i,:ng with his principal, and in seeking ·r-to obtEiin his instructions;;. Now, a question ,,"'Jrises, if the ,\.ppel; :mt could afford spcnrl.ing over · true Shs.5 Million from his private fortunate, would it be ···-··' ;;1s he I purportedly stated in his \.f .S .Do tkit he w1s urn1blo tc, r~➔ isc fees for filing/raising counter - clsim of Shs.5,974t505/=? .:\nd, yet, the Law allows him to apply to sue ,:,r defend an action against him c:1s 3 fortg_c?_- pDUE,eris but there is no evidence that he attempted to do that and his application was rejected. In my view 9 the ,'.\.ppellant's contention at pBrD 6 of the ',J PSoD. thd he did not put up counter-claim because of lock of O O o/o 6 filing fce,s is not anything but e;n cfterlhc)1..:.c;hto hs I h·we sbted obove, he w.:is not entitled in L,-,w to spend such cc;llosso1 sum of m011ey out of the account of the -principnl without the latter 1 s prior ccnsent or instructions. I hcive also gone thrc-ush exhibit D.2 which wos -proiluced by .D.•J.1 with r:i view to corroborc'lting his testimc:ny reg:,rding payments he allegedly made in respect of hil ing godowns and s;::l2ries rir nllowtmces .:Jllegedly p:dd to 0 watchmene It m:::iy be truG that

such poyments were effectively effected to the alleged payees, though none of them was ,called to confirm D',' 1 1 1 s testimony. But be. tha :t as it may, it is tr:i, te law the:t it is the duty of the alleger to prove his case on the preponderance of evidence. Did.the Respondent prove his case ·to that required standard?· The Respondent Company is relying on Exhibit P~4 entitled ;i~EP_;'\YI~:8N11 1\GRE:"11ENT: 1 • · It is an Agreement be_tween Messrs Taylor \:Jin.ch cranzania) Limited and the Appellant - C. Bo K.i1.SSY which was signed on 1/11/1999~ .The Appellant agreed that . . he owes ·to the Res1)ondent the sum of T .Shs .8,205,407/==. It was further agreed between the parties th,)t the Appellant (Debtor) was to repay the debt on the terms and conditions stipulated in the Repayment :~greement (Exh. P .4). The terms and conditions provide Gs follows: - 1. The Debtor shall repay the debt·to the lender in monthly instalments. The first instalment v1ill ,be paid on 15th Decembe:c, 1998, 1,370'1470/==; Second instalment will be paid on 15th J,muary, · 1999! 1,367,000/= •. Third instalment will be paid on 15th February, 1999 1,367,000/==. Fourth instalment will be p9id on 15th March, 1999 1, 367,000/=. Fifth instalment 15th April, 1999 1,367 ,000/= and .Sixth. instalment will be 15th May, 1999 1,. 367 ,000/=o These payments will.be made by chequeso ·rt is agreed that the cheques presented to the lender are drawn from the Debtor 1t3 active current account and the Debtor 'will not close this'account until this debt hes been·completely cleared to the satisf~ction bf both parties.

2. These instalments will.be paid by cheque on the fifteenth day of each month. The lender will present these cheques to the bank without any prior communication with the Debtor. It is the responsibility .of the Debtor to ensure that there are enough funds in his account to cover the cheque value. • •. /7 ·.!. --7 - 3. No interest or doily penalty will be charged on the Debt providing that the Debtor meets all his monthly instalments. 4A If any monthly instalment is missed then the Debt will have interest chr:,rged at·4% per month. The interest wili be c~lculated from 1st November, 1998. _If any monthly instalmBnt is missed then the.Debut will have Daily penalty ch3rged as per the Advanced . ,· Agreement~· The D3 ily Penalty \.-Jill be charged from 1st Novemb<;1r, 1998. 5o This l~e}:-tyment Agreement is valid until 17th May, 1999~ No extension of this date will be discussed. The Debt must be: repaid 'in full by t_his date, without dispute. 6.,. ' Should· the Debtor however fail to con:pl_y to any of the stipulr:itioris above the lender sh,s,11 be at liberty to recall the l)ebt or ariy · part thereof by fore closing on all the securities pledged without notice-.\-· Both the p3rties signed the document but again,~t the signature of C. Ba Kessy 1 (D',! .1) there appe::irs the words in 3bbrevbtion ;;PI'O·;, meaning, Flease Turn Over':, and then over the leaf we· find the folloHing

st9tement: ' . "NoBa I agree with this in principle but for the money r·owe the Companyo (Sgd.) C. B. Kessi'. In defence D\f .1 stated in cr6ss-examii1'3tion thjt he signed exhibit P .4 on the ground that he vJas ·t::.redened th,,t ·he would he taken to police. But this piece of evidence is inconsistent wit:t·what rnio1 averred at para_4of his 1.1 .. s••·D.~ .entitled ;;DET-'-\.ILG OF fJ:•l:IB COERCION AND UNDUE INFLU'LNCE;i 4 For ease pf reference and clarity purposes¾ the said details :>re reproduced hereunder, as follows:- r,T~,..P.laintif~ aided by the 1?£~i_s~, threatened the defendant of arrest if· he did not ,sign the alleged Repayrnen·t Agreement 3nd the cheque.· Td avoid being ' ' ' tortured and being cmbari assed. by .arr~st, 0 , the defendant had no alternative but'to --sign .·;o.·;. a .,./8 •'.}!··- 8 - It is different to say th.Jt tho plain-4:iff would be taken to police (as per IJ.rJ .1 1 s testimony) and th3t ;1the plaintiff aided by the police'. On the former statoment, i.e. to be t.Jkcn to police, I do not find anything stronge, or call it threats, becnuse ..if the. appellant was .::idv:.:-:nced money by the Respondent .to do thot p::irticular project und he ~id not account for the money,. then the Respondent would have been entitled to compluin . to police for stealing by agento But in the latter case, i.e. :;aided by policc 11 , D\'1 .1 never_ <Jdduced

evidence to prove thr:it as,sertion. _D1 .1 '_s 9:>ercision 8lleged detaj_ls of continue to allec;o ::1s follows:- H,'\lso the plo:Lt1.tiff forced. the defcnd::mt to sign the post dated cheque No. 005136551 for Sbs.,30,000,000/==. if he w1;mted to be c1ppointed. the.P'lriintiff 1s agent_. For fe3r of losing and missing my job the: ciefendnnt was obliged to sign the promisory no.te=·r·, . of ·sbtemcmt? T1-:\ere is What a naive ·sort· . . nothing . .in evidence showing or .·• . suggesting that the 'Respondent Comf~T'I.Y:.5:olicite~ ~rie .f~ppellant to be employed by the Respondent as his 1~gent .. ,, .It was the App_ellant who wrote ,9 letter to the· Respondent Conivany on 2/6/19_99 ,:ipplying to be ap11ointed as his Agent for buying cbffee during 1998/1999 season; and there is no doubt that an Agreement was drawn by Advocate Na_Gli r.md the /\greemont is hnve . • . · shown to ; ·. been signed by the parties in .the presence of Advocate Naali 0 lnw · The R~spondent Comparty was entitled in • - to sbte clearly the kind of ·., - ·•-:_. securities··he wanted the-1\ppellont to gu,:?rantee against advanced.money the Company v-iould give to the Appellanto If the 1:::itte~ (Apr,ellantia,¥~uid ,U:o! be ,<.1ble to meet the conditions· in terms of securities the law asLopen to him to refuse to si5n ·the Agre·ement e . Be th,?t as it ffif]Y, the cheque o·f Shs .30 ,000 ,OOO/=o was· not

subject of disput~ at th0 triGl court, ::ilso before this courto The ·dispute is .on the cheque th:1t was drawn by the Ap1)ellant ·on 15/12/1998~ to''v1it, cheque No •. 00.5136578 for Shs.1,370,470/= (One Hillian ·Three Hi;.ndred Seventy Thous,:md Four I-Iundred Geventy Cnly)', in favou.Y of the Res·90ndent Company. D1·J.1 also stc1ted thDt_he signed this . ·. ·,:· •, cheque follo\~ing;' threc3ts from thc:!"Res}:Jondent Company thTt i_f. he did not comply .;_,;{th the te:r.ms o·f the schedule spelt out in exhibit p)~ the ;nat.ter would be referred to police. But sur·.,ose the Respond~nt ,~o,mpany was not being given by the AppeJ.;L,apJ_ P. proper, f!CCou.nt ".ls how_ the money advc.mced to .. - - . ... . ~ D~.1 was spent, w~s thc·Respondent.Company not entitled to info:rm his Agent as to wh::.it ultimcite Dttich he-was gc:i;.ng to t0ke agoin?3t him (rn1.1)? I think the Company' wns-'e-r1titled to ..do th::.t .~nd as Jr1.r_ ~-s I1m concerned I would not constiui such :g. ·v,ar:::rin§··c'S .o1moun;ting J9 threats but a normal utter.:,nce in the normal course' of businesp •. ,,,I.t wns even worse on the part of the Appell,mt to write a cheque when . .he' kn~w that his .3ccount did not h:::ive money - th:Jt 2mounted to cheating and the drawer could even 0 0 D ./9 ,. 9 have been prosecuted for a criminel offence. - The Plaintiff's case further ,shows th,"Jt the Res12ond.~nt Company

had ' been experiencing problems with the fi.ppellant in e~rly ·1999 ,:md this II' actuated the Respondent to instruct ,:mother firm of Lawyers to write 1, · .. .. • f ' Demand Notice to the Appellant in respect of the OUTST:\;JDUJG D:8BT OF I I T.Sl-L.S.6,453 1 020/= - owing to Messrs T2ylor vJinch (T,mzonb) Limited. ' .. t . -- The Demend Notice was couched in the following terms, inter alia:- r :;As per our client Is accounts agreed upon and . ' ' signed by yourself, your liability towards : ~ 1 the company has reoched an unacceptable level of To.Shs.6,453,020/= as at the end· of., Februnry, 1999. <> • • Our client has on several occasions required your to repay the c•bove mentioned amount bu_t you have failed and/or neglected to do so to date. More- over, several cheques written by ~ou to the ,. Company have been dishonoured by the Bank!". This Demand Notice was written to the Appellant 3fter Glmost l~ months had elapsed from 1/11/1998 when Repayment Agreement (Exh. P.4) was reached between the ·parties. As if the appellant was not concerned and disturbed by the dishonoured cheque:he drew in favom: of the Respondent on 15/12/1998 • ,, ! as well as the Demand Notice·d~ted 10/3/1999, the Appellant did nothing I to mend the worsening relationship between him -'.md his principal. Between - . . l the date of the Repayment ,\greement (Exhibit P o4) and on 10/9/1999 when the .

. Respondent decided to go to court there is nothing in evidence showing thc3t the ,:~ppellant h.Jd rendered proper accounts_ to, his 1Jrincipsl to exculpate. himself of the debt of Shs ~8,205,407/=. · Th~re is no e~ide~ce ·[ ' as well s_howing thnt the "RJ;=S'11:1.TET-f:.~\JT OF ACCOUNTS AFTER 1998/1999 COFFEE BUYING SEASON FOR TAYLOR WINCH L'l'D BY CASME F o, KESSY (Exh. Do 1) is . 1 .. . . shown to have been prep.::.:red 'on 8/7/1999 - Dlmost a'fter eight months_ from th ,. t e o f 1·:'i.epaymen ., e 1:aa ~ t ;\ greemen-t ('.;,.., .J.'JJ\.,,_. ~ o 1..J.) D , • Even after its preparation r • (F_,xho Do 1) there is no evi.dence showing or tencfing to show that it was . ( ever submitted to the Appellant's principal, apart from the s:,ime being tendered in court os exhibito l The ,condu~t of the 11.ppell-::int to wait foT e~ght months to prcp3re Exhibit Do 1 from the d0;te he h2d on his own free v1ill ond conscious of 1, •• the act of signing the Re-poyment Agreement exhilJit (p,:,), coupled v;ith his another conduct of writing the cheque exhibi\ .-Po3 while he very well I ! ·. r. ,#- ' '1 knew th3t his bank account Was in the red, le,:iyes much to be desired. If the appe_llant could afford to ope.rate the agency at r:m extra cost of .., T.Shs.5,974,505/= without the aid of his principDl and, or his opproval, -. . ~ ~ • ~ ./10 ... 10 one would not bo surprised to be ::istounded

on the J\ppe1lont 1 s allegation that he was fin<:1ncially disabled to st.3ge a counter claim or file cross-emit to recover the ::illegect costso From the facts and circumstances of the case I'm strongly sritisficd thot the Appellant's conduct disposes him to m::ll".'fide if not dishonestr towards. his principol. I have eJ~·so taken the trouble to ex:,~nine grounds 4 and 5 of the appeal I which h:we been ple2ded in the al tern,.1tive. Grr:mnd 4 st:::ites ns· follows~.:. 4: Thot since the Appellcmt h,:;d tendered· to the ?cespondent his motor vehicle No. 'MB 4226 Toyofo Hihix as security for the Shs 053 ,Million advanced to him pursu::irit to 3rticle 13 of tfie Adv;?Jnce li.gre·e- ment ( which was tendered by PW .1 os exhibit P 62 ::it the trial) the .Learned trial Resident MagistrS1te erred. in lnw and foct in holding as he' did that the Respondent'~; right~ under the .said ,s.gree@=;nt did not lie in only fore-closing the said mortgc1ged Toyota. Mr., Mkumbe for the Appell::mt in support of this ground urged that the Respondent 1 s ·suit to the court .w0s pre-m~ture on the ground.· that the p,=irties ought to lvwe ;ettled their differences by working out the details of the accounts with El view. to striking a r~concilbtion, compromise; r:md thsi,t if the Res~onderit would n~t be satisfied 'then he would pursue ::foreclosure procedure to s.ell the ';\ppellant' s .mortsged

property. That the :]espond-:mt avoided this procedure because the appellant submitted proper accounts bet 1,rhi ch ',12r"' not accepted by the Respondent. Countering Mr. Mkumbe "'.s argument, the le3rned advocGte for the Respondent (Mr, Mbise) coptended if the ap'f)ellant 1 s· ac,counts were proper and genuine wh"'t then b·efoilect' him .f~ rii'ise a counter clnim . .of Shs.5, 97L~,505/:.:? That he f.::iiled to do so boceuse he did not hove such 3 claim against the Responden'cs '·' ~i~se tran ever, Mr'. Mbise reiterated, DW. ·1 never even raised it in exhibit P,4. l\.s to the reason why the Resyiondent went to court rather than taking measu:2cs to ,sell :the mort3ged property, it is Mr. Mbise I s submission thc-it th0 Respondent felt duty bound to estoblish his claim first before foreclosure procedure W3S taken. Further that, he said, there is no lnw th3t b.·.1rs a decree holder from applying for a court I s order attacbing any property bel0,nging to a judgement·debtor in order t"o satisfy the decree. And by th.?~ it would mean that they are not bound to sell the 1 i\ppellant s mortgaged' property. With respect;· I entirely agree witi1 · ' Mr. Mbise and I com con~eive nothing in Law, or fact, dectoting to a· Plaintiff 'as what procedure he should. follow to recover whctever he believes is· his( from his debtor. I therefore find ground No .4 baseless :.md I hereby dismiss

it. ·•· 11 Ground No. 5 is also baseless because the av:.erment or alleg3tion is inconsistent with the tri3l magistrGte's judgement. There is nowhere in the judgement the Learned Resident Magistr3te ever stated. that the Shs.8,205, 1+o7/= was incurred as a loss by the ~pp~llant whilst carrying out the business of the Respondent as his ,tgent. This Desertion vws somehow raised in a cleverly style at paragr3ph 3 of the :,ppellant I s (Defendant's) \o!ritten St9tement of Defence; If there was a loss the l\.ppellr.mt, 35 Agent, was bound to inform the Principal Eis soon ,:is it wAs prGcticable, according to the Law of Iigency ( See ·section 166, Cap.433 - suro). In addition~ the Law of {i.gency require,s an agent to eonduct the principal's business ":_ith a 9 much skill as is generally possessed by persons eng.c::ged in sim:i.lnr business, unless the V.rincipal hc1s notice of his w~nt of skill. Section 164 provides:- :i. • . . The ogent is olways bound to act with reasonable diligence, and to use such skill .ss he possesses i ,:ind to make com·pcnsation to his principal in respect of the direct consequences of own neglect, want of skill or misconduct, but not in respect of loss or dam3ge which are indirectly or remotely coused by such neglect, want of skill or misconduct:;. Now, putting into view the Dp-f]licability of Section 164, 3 question would then tend to ,'Jrise 1 omd this

is whether, if true that the Appellant spent over Shs.5 Million in exess to the ,:.1dv;:mce money given to him, the Appellont exercised reasonable diligence and used his possessed skill in transacting the busin•::ss of the :Jgency? The :;ippellant led no such evidence Dnd to prove him wrong th3t the claim of Shs. 5 Million plus -?-g:::iinst his principal was nothing but an ,::ifterthought because nr .1 did not even dare raise it in exhibit P.4. In short, there was no evidence at ·~he t:i:·ial to prove loss or extr3 expenditure to support VA .1 1 s proposition. In the upshot, I ::im satisfied thot this appeal is unmeritorious and on th.cit premise it is unsust,iinable. Co:.iaequcntly, therefore, I dismiss the ~ppeal with costs. Accordingly it is so pronounced.

JUDGE •· ... ·· 12 ;. Delivered at Mbeyo 1 this 31st· of July',' 2002 'in the· presence of Mr. Mkumbe, Le::irr.:ed Advocate for .the· Appellant, the ~esponden:t •.

JUDGE 31 .07 .·2002 · .r .• .. . ,. J •- _-,..i r. .: • .1