20161103 TZHC Dar es Salaam

. IN THE HIGH COURT OF TANZANIA . (COMMERCIAL DIVISION)· .AT DAR ES SALAAM MISCELLANEOUS COMMERCIAL CAUSE NO. 48 OF 2016 CHOBO INVESTMENT COMPANY LIMITED ......... ~ .............. APPLICANT . VERSUS 15th June & 3rd Noverrrbf;r, 20JG .;·,. ,·, i. RULING M\f\lAMBl2Gf:U:.:.cJ,: .. The present appiicatioh has: been taken under the provisions of section 6 of the Arbitration /\tt, Cap; 15 of the Revised · Edition,;,• 2002. and any other . enabling prnvision of law seeking an order for, inter alia,· stay of proceedings of Commercial Case No. 24 of 2016 ... The application ,has been supported by ,•• , I • : • r ;•:• ! ~., If, • •••, • ; ,.••.,,• 1, •I ,: • . the affidavit of.John Chobo; Managing . Director of the applicant company and . .·.:.·....-. :!:.: resisted by the counter-affidavit of Carolyne Jackob Muro, an· advocate of this court and courts subordinate hereto except for the Primary Court. The appiication was argued on 1.5.06.2016 during which both parties were , ,. ·. -; · ·,, · represented; the applicant and respondent were advocated by Mr. Sifael ; . : •· · :, :: :· Muguli and Ms. Carolyne Muro; both learned counsel respectively.· The learned counsel for the parties had earlier filed skeleton written arguments as . -,. dictated by the provisions of rule 64 of the High Court (Commercial Division) Procedure Rules, 2012. Both I.earned counsel for the parties sought to adopt the· affidavit and counter-affidavit (as ·the case may be) and their· respective ske'leton· arguments~ ; · .. '..: ·- ·~-: ; ~: . : .~- ·'. .- . '. : Arguing in support of the application, Mr, Mug~li, lea~ned counsel submitted that they are praying t~ hF!'{~-Jt1~_rJroc~~q.ings in·,c;:omrnercialCase No. ·24 of. . ~: '. ' • • 1·. ·- ' ' ••.' • l: ' f,.· ., •.·•• •, '• . • .'• I• •• ' • • ' • 2016 stayed pending their taking the d_ispute to arbitration in compliance with tt,~,·dause. in the agre.~r.nent. \-'.ll'hir,h .n~quires them.to. submit th.emselves to • ': •,' • • •I • I • • • · arbit~ation in case of any dispute between.tt.,em. That, when they were in the· . of refE:rringtht~'imatter to arbJtration,. the .respondent had already filed. process Commercial. Case No.· 24 of 2.016. He added that they also had receiyec:l Annexture. EA 2 . ' to the ;applkatlon telling them that the arbitrators had been . . . . appointed. The learned counsel submitted further that they had satisfied the two CCH1ditions' u'nder:, section 6 of the Arbitration Act which reqUir'E!°S ·•ar,i - ': . , ·. · ':· . :::y · applicant .tp':sh;)~0'.'~lh,afc~e w~s willing t:d pa:1:icipate in the arbitration at the · . , .._, :.· ·,.., .. · : - •time --~f-' . •r•.; .• fi!in'g ~tl:1e" ·su{ :~_H:;.d -\t~at there is n.o means of delaying the arbitration ,· ,; : .. ...·~-• . ,:,::• . : .: .. . ; \ ' ,. ~ . - ,.: I; ,. ; .. • \ •;: i • , .J " , : • , • • ' • . , . p_rp~e.~s:.• ·Hg:ad(Je_d.· that !~he p~oces~ bf r~ferrin~ the matter to arbitr?tion has _. ·_ ..... ' '. b~er~:;fr~_~'tr.~•ixid Q); 'thl n:~'.~i;Oi,1derit not replyf~~ \o tt,e'ir ietter of 21.0L2015; . . .. ' ·' .:· :· .- . A~n~~t:~·;~ ·t~;.:i to_: (h~; affici~v-lt. ~uriporting: th~ '.applitatior1. 1·0 buttress his .... : c.:·:. i: :: .. -~•~gu·,~ents, -th'(:! . lf:;a~f;:ed :··.·c61~f'lSei citec(. IPTL :'vs VIP. Engineerin~. and ,., i ,,,; -,..·, . . Mj~iieiting'i'..td'[2.0b4~(Tl~.R 3Ti 2i'°nd EA Bre~eries Ltd Vs GMM Company " . . _.,:, .· ::.,,•,·.:., l.td[20d2i;TU~1:2. r:' ·. .,t< '.:.. -.: : Ms Muro, learned counsel for the respondent strenuously opposed the -:; ...application. s11·e had one niain - reason -for that opposition; that the ;· ... .. · :. \ •· , .. respondent made· e.verf ·possibfe effort to. have the dispute between the . parti~s arbitrated pLlrsuant tb. the -Cooperati:ve Agreement between them but -th1tthe .i:;pplkari ·b!pc:ked ~aking it. impossible to proc~ed with ~rbitration. S~1~~ siJbmitted that .t~e respondent notified. the applicant that it is proceeding • •• : •• ·:: • : • :• ! ~; 2 ' . to arbitration to the Tarizani_a Jnstitu:t:e' :of A,rbitr::a:to,rs (TIArbs) -a~d sent the ... '' r~:levant note by couriE~r ·service but that t~.1at notice was never replied. Ms. Muro added that it is not true that th~y neg_!ected to answer the applicant's letter of 21.01.2.016; they replied via ;email ·of 25.01.2016 (A~nexture D to the counter affidavit). The_ learned counsel aq_dert t~cJt on: s<;veral occasii:ms they· made follow-ups ' .. ·.. . .• . . '. : . ; "r .. . :·. _:· . ~ ' ., '. -, . .. . . .: . . .. .., . . . . ~·~ .. ' .. . . with the applicant's counsel by phone calls. and emails without success .. . ·, .. . Sh~~ '. · ,:- irJsisted that the .applic?Jnt,h~s been_,~1.ocking the arbitrati_oii.process and cited_: • •· • ••·' • ,•• ,,, '' 1 • • • '• • • • ,· . • I •• Guest a11d Chril11es Vs_lVUWA [1998] TLR 135 in which it was held that_ a party must have shown •-willingness to have the matter arbitrated: · Sh!= -a,lso_ cited Co11structio11s f:.ngineer.~_Bui/ders· Ltd_ Vs DUCECO [1'983.] T~R.13, Tanzania Mo.tr;r Service.s" Ltd 8 P!,"R.C 115' ·Me.har Singh Civil Appeal_ No .. ' ' ' ... ·:: ··.. 115 of 2005 (unreported) _and EA Power and Lighting_ Co1npany Ltd_ Vs. :.: , . •, I; , Ms. Muro, . learned. couns;el-add~d . - . . ...that'.section . .. ' 6 of.the. :Arbitration.Act ·•. ..... . provides',..-.::, .. , four condition$ which _rr1ust be .~atisfied before an. application c;>f . ~t,l~ i•1~ture ·Is;· • ' • ' • • • ' • I • ' ' ' • • ,._ " .·,,.'.,:. granted: ...,.. -·. .,,· ,. ..-.. i . '•. : ~ •.. ·;; i ::_....-.. /',~- ', : ' ... :' ... ii. The applicant . . .must.. .. . not .. have . file,d . . . a. . Written . .. . . . . of Defence .. Statement . . or must not have taken· any step into the proceedings; · iii. Convenience of the parties; and iv. Reasons to justify refu·sal to grant stay of proceedings.· . ·., :Sh_e .. submitted .that out of the four conditions :above-, ·the applicant fl _, :has' :~·~, ./~·~.:: , . . satisfied only on'; cond.iti_on; the second. She, stressed that tfie applicant. has· 3 not all along been 'Nilling ,and_ reaqy . to ar:pitrate, H: is -no. longer _convenient for [" - • . the respondent to. continue. waiting· and that there are no justifiable reasons i::: · :.- · · •. to grant stay of proceedings and thus prayed that the application be : · · dismissed with costs. ~- ···Rejoining, the ?.,pplican(s co~nse! r~i.terated -that the 9pplicant had all along [' ,, ... . . . ~- been _and was . still willing_ .to arbitrate . . . .only . . the. letter pf .. that . 21,01.2016 was r~=-· . :. not replied. He -added_ U~_at_they wer~. not,taken on .board in the process of r- ,; -: .. choosing arbitrators _and that . their- con~ems were not addressed by the \=-.. · ··-: i respondent rushing tht:! ~_rbitr:ation proce$_S ...• t_~·· _'.: :. "</:·.... I have anxiously con~ic.iered·· the". rival' argumeht5 by both ·,earned counsel.-~ : H~ppily, the iearneci counsel for the parties are at one that there is an ; · .... ": ... . .. .. .,_. .. ·. . .-, . ·.· . . ··. . . . . r arbitration clause in the Cc)operati've A'gree_men:t between them. The· same is ! .. ,., , found at Clause 7 of the'.P1g/~ement.·:·· They ar:e also at one, I think, that the. '·. .:'.:'.: . ,': -'. .· ... ' . . -· . ' ,· . . ., ' ·. . . .. . : . ,, :have been reforr'ed to arbftration first before a resort could i _ dispute ought .to •• • lr. ,· .. : ·. . be made to this (~)lilt' 'wtii!e ·the appl.icant's. cour,sei .states 'that his.di~nt ·has t 1 '<.. . ,.~ .': ,.,: •• ·'. . . . . . '; . . .·.. . .. . . .. . . . . . . : . all along been ready for' arbib·,~tion· and ·wrote the respondent a letter to that · · ·· · . effect which received ·no re~;ponse, '. : • "'I • •• :. . I •. • • 'the respondent avers that the applicant ir~ • • • ' a- . •• ,• •• has been blockinq- · E!ffl11ts of· arbifratior,· . arid that the letter: . . . was responded . by email.. • < . ,,,. I have seen the letter datr:d 21.01.2016 by the applicant which the applicant's counsel sent the respciidl~nt (ind Ms. -Muro; learned counsel acknowledges in r1er ·subrnit;sior1s to havf.;· ~eceived it. I have seen the email of 25.01.2016 ·· which was a reply to the said letter. Mr. MUguli for the applicant maintains · that they never recefv~d. thf~ response fo that letter suggesting, I think, that ~ · they never received the en\ail \'lifthout any ffirther detail. •· 4 Ms. Muro, learned counsel has also· arg·ued with some force that the applicant; .. ,· , :·.. , .has been blocking aJi the efforts by ·respondent to have the dispute arbitrated ~ i ·i:: ><--·· .- . •. . . as:·per the arbitration·dause:in::the Agreement These :arguments on· this: ... ·. · •.....,.. point~have been made. at :rJarais·..4 through-to_: 10 of the skeleton arguments. [ :- .y :-: ::· ... · ·· However, respectfully,:-f··do not think the learned counsel for the respondent:-:··::..·.. :t·''. has sufficiently explained how the applicant has been blocking the arbitratior1 ~ . ::<: •_:·. ::', .. ,_,:,. ·, :, . ,·· ·= ' •. •• • .f ' ' .. ~..:.... pro_cess, .. ·.. ~ -r ·, · ,:: Th~- only assertion by. -the ::respondent on how. the applicant blocked the ~ ;·, :·.·· : •,< . ,:... ·. 1-·. ,'. · · .rei:;pondent's effo1ts fo(atbitration is;.that: no response Was ever made to .the L - ·.:_:•.i•. .... email: of . 25;0L2016: .: Cornrnuni·cation ... by. :email is one· of the modes; ···.- :·.·. . . ctJmrnunication ·allowed by·the Rules · of this · court. The applicant is well ; ... ·· · • · ·.-,·: ·aware of thi•s as thi=~ tetter the counsel wrote to the respondent's· counsel on i~ :. ,":-·< : . .~' :-- 1-,,'/ :- ·~ . "II, : : ·: .. :·,.-:._, · · ... · -31:12-:2015 intimater:! .to·. her:that they were 'advocates for _the.applicant and'. : . , > -: ·:,·.:, a'sked the.n-r . to d1amiel '. their communJcati6ns- ·through the': emails and 1 , ;.- >r ,:-·/ ·: correspondences -shown in that letter, It is surprising. ther~fore why the [ ·,/ · . :,,•::,-:.::•.: .. ,~~~;;cant's coun~~I ~lairri~ to· ha~;e not received any response to their letter of ~ .. ·. ·:. __ · :· ;. ~ • • • • ' • .' • • • • • ·: • • # •• :: • ,, • : : : • : • • • • • • • • : • • • i 21.01.2.016. However, as .there is no proof that the applicant's counsel . . i '., •.·,· . .-: ·.· . . received t~he said email and in' further' view of the fact that the respondent has; not sufficiently brought to the fore enough material to verify the· app.licant's b_l_ocking the efforts ?f having the disp~_te. referred to ar_bitration, I give the ap.pl.icant's counsel a b~nefit of doubt' and take that they might have not ..... , . ~ •. ' .' ! ·.. : 1 . received the ernail under discussion. As th~ applicant is ready for reference of t1'1e dispute to arbitration,· I think it wil-1 all· be fair to allow_ the present application so as to pave way for tile process of arbitration. 5 · ·In the final analysis, this applicat;ion is a!lov,;ed·. CornrnerdaJ Case No. 24 of 2016 is stayed pending reference .of the qi~pute, betweeo the parties ther-ein; · ,applicant and. respondent,.to ·arbitration, No order is made ·astQ costs. Order accordin9ly. ··_ · - ·. ···:c~,/c ·.i . • ·.·· ···.rd ·: .:· ., · ... · . DI\ rED at DAR f..~., .,.A.1.J\AM this 3 day of November, 2016 . .· j, C ...M. MWAMBEGEL.E. J!JJJt;r;. 6