Continental Reliable Clearing Tanzania Company Limited vs Tata Africa Holding Tanzania Limited Civil Case No 162 of 2023

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA DAR ES SALAAM -SUB REGISTRY CIVIL CASE NO. 162 OF 2023 CONTINENTAL RELIABLE CLEARING (TANZANIA) COMPANY LIMITED........................................................................ ....PLAINTIFF VERSUS TATA AFRICA HOLDINGS (TANZANIA) LIM IT ED ...........................DEFENDANT RULING Date of last order: 14-6-2024 Date of Ruling: 28-6-2024 B.K.PHILLIP, 3 On 27th February 2024, the learned Advocate Shaba Mtung'e who appears for the plaintiff prayed for an amendment of the plaint to increase the amount claimed and include facts on new cars that were left out. The prayer for amendment of the plaint was granted as prayed by Mr. Mtung'e. The amended plaint was filed and served to the learned Advocate Nzaro Kachenje, the defendant's Advocate who in return, filed the written statement of defence to the amended plaint together with a notice of preliminary objection couched as follows; That the amended plaint be struck out as it violated the orders o f the court o f 27th February 2024.' This Ruling is in respect of the afore-stated point of preliminary objection. I ordered the same to be disposed of by way of written submissions. Submitting in support of the point of preliminary objection Mr. Kachenje submitted as follows; The cause of action in the original plaint was a breach of contract for the purchase of a Motor Vehicle entered into between the plaintiff and defendant sometime in 2019. The subject matter in the plaintiffs case was stated in paragraph six of the original plaint, to wit; twenty (20) motor vehicles purchased by the plaintiff from the defendant sometime in 2019, registered in the name of Equity Bank Tanzania Ltd. It was alleged in the original plaint that following agreements among the plaintiff, defendant, and Equity Bank Tanzania Ltd a letter credit (LC) was issued. Six Motor Vehicles with registration numbers T633 DDZ, T636 DDZ, T637 DDZ, T991 CPV, T802 DTD, and T747 DTB out of the twenty (20) vehicles had some mechanical problems, thus were put under the custody of the defendant. In the amended plaint, the plaintiff set out a new cause of action. It mentioned registration numbers of twenty (20) Motor Vehicles all of which are registered in the name of the plaintiff and the defendant, not Equity Bank Tanzania Ltd as alleged in the original plaint. The six Motor Vehicles mentioned in the original plaint are not part of the twenty (20) new Motor Vehicles. The amended plaint is going to prove a different subject matter that was not envisaged by the plaintiff in the original plaint. The plaintiff purported to unearth/discover new information, while in reality and truth, simply took the contracts and Motor Vehicles pleaded by the defendant in its written statement of defence, repackaged them into the plaint, and claimed it to be its case. Mr. Kachenje contended that what has been done by the plaintiff is an injustice that cannot be allowed to sail through under the umbrella of amendment of the plaint and it goes against the parameters set by the Court 2 in its order for amendment of the plaint. He went on to argue that the relevant law conferring the court power to order the alteration or amendment of pleadings is Order VI Rule 17 of the Civil Procedure Code, Cap 33 [R: E 2019] ( 'CPC') which provides as follows; "The court may at any stage in the proceedings, allow either party to alter or amend his pleading in such manner and on such terms as mayjust, and all such amendments shall be made as may be necessary for determining the real questions in controversy between the parties". Further, Mr. Kachenje contended that case laws provide that an order for such alteration or amendment to the plaint should not be general or open- ended and should define the parameters upon which the alterations or amendments are allowed. To cement his arguments he cited the case of Jovent Clavery Rushaka and Another v. Bibiana Chacha, Civil Appeal No. 236 of 2020 (unreported), in which the Court of Appeal held as follows "It is settled law that a pleading can be amended at any stage o f the proceedings only to the extent allowed by the court on such terms as may be just and such amendment should be limited to what will be necessary for determining the real question in dispute between the parties." Mr. Kachenje was of the view that the amended plaint introduced a new cause of action and new subject matter, in contravention of the court order made on 27th February 2024. The court order for amendment of the plaint was to the effect that new contracts could be added but only those that dealt with the existing subject matter and the same cause of action. 3 In conclusion, Mr. Kachenje prayed that the amended plaint be struck out with costs. In rebuttal, Mr.Mtung'e started his submission by arguing that the point of the preliminary objection raised by Mr. Kachenje is not a pure point of law. It needs evidence to establish it thus falls short of the quality of a pure point of law as stipulated in the case of Mukisa Biscuit Manufacturing Co. Ltd Vs West End Distributors Ltd [1969] E.A. 696, he beseeched this court to dismiss it. On the merit of the point of preliminary objection, Mr.Mtung'e submitted that the amended plaint was filed in compliance with the court order. He went on to submit that in the original plaint, the plaintiff stated that the Defendant has been selling TATA motor vehicles to the Plaintiff since early 2019. Plaintiff has purchased numerous TATA Motor Vehicles from Defendant. The Plaintiff's principal debt was USD 5,109,180.00 for the order of the purchase of 20 TATA DAEWOO NOVUS from the defendant who has paid USD 4,939,679.00. The remaining balance is USD 169,501.00. Six (6) Motor Vehicles are with the Defendant and one of them got a fire incident consequently, it was written off. The plaintiff prayed for the following reliefs; (a) A declaration that the Defendants are in breach of contract of the purchase of motor vehicles and breach of vendors duties towards the Plaintiff. (b) A declaration that the loss which has been generated by the defendant to the plaintiff is to be paid by the defendant. (c) A declaration that USD,272,819.92 is the principal outstanding amount, USD 17,021.28 as file Administration Cost, USD 13,641.00 debt recovery 4 charges, and USD 214,246.33 as pena! Interest, which the Defendant has been demanding as an outstanding balance from the Plaintiff is invalid and does not exist. (d) A declaration and an order that the demands issued by the Defendant and Default Notices on debt are a nullity. (e) A declaration that the Defendant has caused a direct loss of Tshs. 5,442,165,897.44 And general damage of Tshs 3,000,000,000/= and he has to pay to the plaintiff. (f) A declaration that the defendant has no power to repossess the motor vehicles based on his agreement with Equity Bank Tanzania Limited. (g) A declaration that the defendant has to perform his contractual obligation. (h) A declaration that the Defendants are in breach of supplier of Tata motor vehicles facilities and breach of vendor duties towards the Plaintiff, general damages to be assessed by the court. (h) costs of the suit. (i) any other relief the court deems proper to grant. Further, Mr. Mtung'e submitted that in the amended plaint the plaintiff stated as follows; the plaintiff and the defendant entered into agreements for the purchase of Motor Vehicles, TATA brand. The mode of payment since 2014 was by way of installments, whereby up to 6th September 2022, the total debt was USD 5,109,180/=, the payment made was USD 4939,679/= and the balance was 169,501/=. Between 15th November 2016 and 4th October 2017, Plaintiff purchased an additional 20 Motor vehicles from the Defendant. The Plaintiff’s principal debt was USD 5,109,180.00 for the order of the purchase of 20 TATA DAEWOO NOVUS and has paid USD 4.939.679.00. The remaining balance is USD 169,501.00. Six (6) Motor Vehicles are with the Defendants and one of them was involved in a fire accident. It was written off. The registration numbers of the said 20 Motor vehicles are; T955 DLH, T977DLH, T976DLH, T979DLH, T964DLH, T651DLN, T491DLN, T487DLN, T490DLN, T653DLN, T646DLN, T492DLN, T648DLN, T489DLN, T641DLN T488DLN, T701DMB, T959DLH, T957DLH, and T963DL. These motor vehicles were subject to collateral in Equity Bank Tanzania Limited. Mr. Mtung'e maintained that going through the original plaint and the amended plaint the main issue in the amended plaint is the same as the one indicated in the original plaint, that is, a debt to the tune of USD 5.109.180.00, arising from the purchase of TATA Motor Vehicles whereby the plaintiff paid USD 4,939,679.00 leaving an outstanding balance to a tune of USD 169,501.00. The amended plaint did not introduce a new cause of action. Expounding on this point, Mr.Mtung'e argued that the number of Motor Vehicles indicated in the original plaint is 20, and the same number of Motor Vehicles, is indicated in the amended plaint, only that the amended plaint contains the description of those Motor Vehicles. The Six (6 ) Motor Vehicles that are in the custody of the defendant were also mentioned in the original plaint. Moreover, Mr. Mtung'e submitted that the controversy, in this case, is re­ possession of the Motor Vehicles in question. The plaintiff claims that those Motor Vehicles are subject to collateral in Equity Bank Tanzania Limited. Referring this court to Order VI Rule 17 of the CPC and the case of Jovent Clavery Rushaka ( supra), Mr. Mtung'e argued that the amendment of pleadings is aimed at solving the real issue in controversy between the parties. He contended that in this case, the real dispute between the parties in this case are; breach of contract in respect of the purchase of 20 Motor Vehicles, whereby six (6) Motor Vehicles are under the custody of the defendant and not in use /working while they are subject to a loan agreement and breach of vendor's duty, promises and warrant. Mr. Mtung'e argued that the defendant has not expressed how she has been affected by the amendment of the plaint and currently is barred from giving such expression in the rejoinder. This court is a court of justice and for justice to be done parties have to be free to express their dispute and the law allows parties to amend pleadings at any stage as per the court order. This goes to the root of the right to be heard, contended Mr. Mtunge. He was of the view that by filing this Preliminary objection the Plaintiff is limiting the parties to expose all issues in dispute between them. This court should not entertain technicalities, argued, Mr. Mtung'e. He cited Article Article 107A of the Constitution of the United Republic of Tanzania to cement his arguments. He implored this court to dismiss the point of preliminary objection. In rejoinder, Mr. Kachenje reiterated his submission in chief and joined hands with Mr. Mtung'e that a point of preliminary objection has to be a pure point of law that does not need evidence to prove/ establish it. He cited the case of National Insurance Corporation of (T) Ltd and Parastatal Sector Reform Commission Vs Shengena Ltd, Civil Application No. 20 of 2007 (unreported), in which the Court of Appeal held as follows; "What is a preliminary objection? We think the rational answer to this question can be found in what the court observed in the case o f Mukisa Biscuits Manufacturing Company Ltd vs. West End Distributors Ltd (1969) EA 696. On page 700 Law, 5 JA observed as follows: - So far as I am aware, a preliminary objection consists o f a point o f law which has been or which arises by dear implication out o f the pleadings, and which, if argued as a preliminary objection may dispose o f the suit." Mr. Kachenje contended that by just comparing the contents of the original plaint and the amended plaint, without going into any evidence, this court can readily discern the variance in subject matter and cause of action between the two plaints. No further evidence is required to substantiate that the plaintiff did not bring up new information but just took the contracts and Motor Vehicles pleaded by the defendant through the written statement of defense, pleaded them into the amended plaint, and claimed it to be its case. Further, Mr. Kachenje submitted that Mr. Mtung'e admitted that the amended plaint includes a new subject matter and cause of action. However, contended that the plaintiff had good reason(s) for doing so and maintained that the facts added in the amended plaint were about the 20 Motor Vehicles based on the defendant's notice and contracts for 20 Motor Vehicles between the parties herein. Mr. Kachenje pointed out that the plaintiff did not have a case until the contracts and information about the Motor Vehicles were provided in the written statement of defence by the defendant since the alleged contract in the original plaint is that of 2019. It is the defendant's written statement of 8 defence that introduced the contracts of 2016 and 2017. Surprisingly in the amended plaint, there is no mention of the contract of 2019. The only contracts mentioned are the ones for the years 2016 and 2017. He insisted that the plaintiffs prayer was to amend the plaint to increase the amount claimed and facts about new cars that were left out. Mr. Kachenje posed a question on what happened to the contract of 2019 which was the main subject matter in the original plaint. He contended that its total removal from the amended plaint and replacement with the 2016 and 2017 contracts led to an amendment of the plaint beyond the court order and brought up a new case/cause of action altogether. The twenty (20) Motor Vehicles mentioned in the amended plaint were not mentioned anywhere in the original plaint. In paragraph seven ( 7) of the amended plaint, the plaintiff annexed the list of twenty (20) Motor Vehicles mentioned in the written statement of defence and just repackaged it as if those were part of the contract of 2019 which is untrue and incorrect because the written statement of defence the defendant did not state that those Motor Vehicles were purchased through the 2016 and 2017 agreements, contended Mr. Kachenje. On Mr. Mtunge's contention that the amendment of the plaint is aimed at making sure that the necessary facts are disclosed for determination of the real question in controversy between the parties, Mr. Kachenje contended that the amendment of the plaint is not general or open-ended and the court defines the parameters upon which the alterations or amendments are allowed. The applicant's amendment was beyond the court order. On the application of the principle of the overriding objective, Mr.Kachenje argued that the same cannot be applicable in a blatant violation of court 9 orders and Order VI Rule 17 of the CPC. He pointed out that in the amended plaint the plaintiff mentioned registration numbers of twenty (20) Motor Vehicles all of which are registered in the names of the plaintiff and the defendant and not in the name of Equity Bank Tanzania Ltd as alleged in the original plaint. The six Motor Vehicles mentioned in the amended plaint are not part of the twenty (20) new motor vehicles. Having dispassionately analyzed the rival arguments made by the learned advocates, before going into the merit of the point of preliminary objection I have to deal with the concern raised by Mr. Mtung'e that the point of preliminary objection is not a pure point of law. It needs evidence to establish it. Let me say outright here that Mr. Mtunge's argument aforesaid is misconceived since the point of the preliminary objection raised is predicated on the court order which granted him leave to amend the plaint, thus, no evidence is required to establish whether or not the amendment of a plaint is beyond the court order apart from perusing the original plaint and the amended plaint. Thus, I am inclined to agree with Mr. Kachenje that the point of preliminary objection at hand is a pure point of law, well within the conditions stated in the case Mukisa Biscuits ( supra). The above being said, let me proceed with the determination of the point of preliminary objection, the subject of this Ruling. To my understanding, what I am required to determine here is whether or not the amendments of the plaint made by Mr.Mtung'e are in contravention of the court order made on 27th February 2024, to wit; "leave to amend the plaint to increase the amount of the claims and to add some facts which were omitted, in particular about 10 the new vehicles". It is common ground that the court has discretional power to allow amendment of pleadings under Order VI Rule 7 of the CPC. As can be discerned from the submission made by the learned advocates and the original plaint, the plaintiff sued the defendant on a contract entered in 2019. In the original plaint, it was stated that the defendant has been selling TATA Motor Vehicles to the defendant, on credit since early 2019. The plaintiff had purchased numerous Motor Vehicles from the defendant. The plaintiff purchased 20 Motor Vehicles from the defendant and, a letter of credit was issued by Equity Bank Tanzania Limited with a condition that the said Motor Vehicles were to be used as collaterals by Equity Bank Tanzania for the loan granted to the plaintiff. Six Motor Vehicles were returned to the defendant ( the seller) for mechanical problems which remained grounded at the defendant's premises to date, hence causing loss to the plaintiff as the plaintiff was not able to use them as intended. Also, the plaintiff alleged that there was a delay in servicing other motor vehicles upon reporting mechanical problems. The defendant was negligent and breached the contract it entered into with the defendant. The plaintiff prayed for the following reliefs among others; a declaration that USD 272,819.92 was the principal outstanding amount, USD 17,021.28 as administration costs, USD 13,641.00 debt recovery charges, and USD 214,246.33 as penal interests which the defendant has been demanding as an outstanding balance from the plaintiff is invalid and void, and a declaration that the defendant has caused to the plaintiff loss of Tshs. 5,442,165,897.44 and general damages to the tune of Tshs. 3,000,000,000/=. Thus, the cause of action in the original plant was a breach of contract made in 2019. However, in the ii amended plaint the plaintiff alleged that it has been purchasing TATA Motor Vehicles from the defendant since 2014 on credit, and purchase prices were being paid in installments. Between 15th November 2016 and 4th October 2017, the plaintiff entered into a contract with the defendant for the purchase of twenty (20) Motor Vehicles on credit. It is apposite to point out here that I am inclined to agree with Mr. Kachenje that the amended plaint has a different cause of action from the cause of action in the original plaint. In the amended plaint the cause of action is a breach of contract entered into by the plaintiff and defendant in 2016 and 2017 whereas in the original plaint, the plaintiff alleged that the contract between the plaintiff and the defendant was entered into in 2019. So, it sued for the breach of the contract entered into in 2019. Not only that in the amended plaint the plaintiff raised new allegations which were not in the original plaint. For instance, in the amended plaint the plaintiff alleged that the defendant while knowing the existence of this case filed civil case No. 198 between the parties herein in the Resident Magistrate Court of Dar es Salaam at Kisutu, but also filed a Misc Civil Application No. 178 of 2023 in the same Court for the aim of Making the repossession of the Motor Vehicles while knowing that it consented all twenty (20) Motor Vehicles to be taken as collaterals for the loan granted to the Plaintiff by Equity Bank of Tanzania, as a result, caused Equity Bank Tanzania Limited and Equity Bank Kenya Limited to file in court a case against the plaintiff. Consequently, the defendant's action aforesaid caused a problem between the Plaintiff and Equity Bank Tanzania Limited. As correctly argued by Mr. Kachenje, the contracts for the purchase of Motor Vehicles between 2016 and 2017, were pleaded by the defendant in its 12 written statement of defence. I am inclined to agree with Mr. Kachenje that the order for amendment of the plaint was not open-ended. It was specific to the aspects mentioned by Mr. Mtung'e in his prayer. The plaintiff cannot legally be allowed to abandon its case and adopt the defendant's defence, and obtain relief on that footing. The issue here is not whether or not the defendant had the opportunity to respond to/challenge the plaintiff's averment in the amended plaint, rather the issue is the legal requirement that amendment of pleadings has to be effected in line with the court order, otherwise, the purpose for issuing specific court order for amendment of pleadings will be defeated. From the foregoing, I hereby sustain the point of preliminary objection. The legal consequence for amending pleadings beyond the court order is striking out of the suit ( see the case of Isdory Joseph Mwepongwe and 5 others Vs Ahamed Mohamed Soud (Administrator of the estate of Omari Soud, Land case No.167 of 2021), thus, I hereby strike out this suit with costs. Dated at Dar es Saf “ ’ day of June 2024 JUDGE 13