20170831 TZHC Dar es Salaam

F IN THE HIGH COURT OF TANZANIA AT DAR ES SALAAM REGISTRY . AT DAR ES SALAAM CIVIL CASE NO 102 OF 2012 DORIS KISANGA T/ A. MAS~NGA GENERAL SUPPLIES ............. PLAINTIFF VERSUS I • KILOSA DISTRICT COUNCIL. .. :............................................. DEFENDANT JUDGMENT Date of Last Order: 31 /7/2017 Date of Judgment: 31/8/2017 The Plaintiff, Doris Kisanga is a natural person, a business woman trading in the name of Masanga General Supplies in Kilosa District. The defendant is a Local Government Authority established under Article 145 ( 1) and 146 of the Constitution of the United Republic of Tanzania 1977. Facts giving rise to the controversy between the parties revolve around a claim of Tshs. 262,598,682/= pleaded as the outstanding amount in respect of various goods ordered by the Page 1 of 27 ,I" defendant and supplied by the plaintiff on credit basis. Attempts to be paid her money through the usual manner failed, thus, through her counsel, Emmanuel Safari, on 21 st day of May, 2012; she instituted the present suit seeking the following reliefs: a) A declaratory order that the defendant's failure to pay for goods supplied by the plaintiff amounted to a breach of contract. b) An order directing the defendant to pay the plaintiff the sum of Tshs 262,598,62/= c) An order for payment of general damages as may be assessed by this honourable court but not less than Tshs 200,000,000/= resulting from the defendant's unfair conducts of failure to settle the above said outstanding amount. d) Payment of interest on the above amount at the commercial rate of 30% from the date of cause of action to the date of judgment. Page 2 of 27 e) Payment of interest on the above amount at the court rate from the date of judgment to the date of full satisfaction of the decree. f) Costs of the suit g) Any other relief this honorable court may deem fit to grant. Before the trial began, the following issues were framed for determination: 1. Whether the Plaintiff was requested by the defendant to supply various goods to the defendant and she did supply the same on credit basis. 2. Whether the Defendant paid for all the goods supplied by the plaintiff to the defendant on credit basis. 3. Whether the Plaintiff suffered any damage as a result of the defendant's act of not paying money for the supplied goods if any on credit basis 4. To what reliefs are the parties entitled. Page 3 of 27 When the trial was called on for hearing on 2/5/2016, Mr. Emmanuel Safari and Mr. Maganiko Msabi, learned counsel appeared for the plaintiff and the defendant respectively. Mr. Safari informed the court that the plaintiff intended to call only one witness while Mr. Maganiko also said the defendant will call one witness. Being led by her counsel, Ms Doris Richson Kisanga took up the stand and testified as PWl. Her evidence was to the following effect; that she is a business woman trading by the name of Masanga General Supplies and that she lives at Uhindini Street in Kilosa District within Kilosa Township. She went on that she runs a shop that sells assortments of goods, including; hardware, stationary, electrical appliance and farm produce which she used to supply to health centers adding that her main client used to be the defendant. She said she began supplying goods to the Kilosa District Council in 2002 which included hardware, stationaries electrical appliance and farm produce. She testified further that defendant used to order specific goods through local purchase orders (LPOs) after she had been awarded tenders by the Council. She went on that after securing the Page 4 of 27 tender she used to procure the ordered goods and deliver them to the defendant together with an invoice and a delivery note for the store keeper to sign upon receipt. She said the arrangement went on well between 2002 up to 2008 when the delays in payments began. She said in 2009 there was flood disaster which affected Kilosa urban, Behewa and Magomeni areas as a result, the District Executive Director one Kalumwendo (hereinafter referred as OED) approached her and ordered for the supply of tents. After complying she later demanded for LPO and reminded the OED that the Council still owes her money. The latter reassured her that there was a special fund for the emergency purchases. PWl testified that between 2002 and 2008 she had supplied goods worth Tshs. 183,598,982/= which had not been paid. In October, 2009 she said she was paid Tshs 99,000,000/=, leaving unpaid balance of Tshs 87,598.98. In December, 2009 the OED approached her and ordered emergency goods worth Tshs 175,000,000/=, she said for all she was issued with LPOs. Page 5 of 27 Explaining on the procedure involved in the transactions between . her and the defendant, she said that upon the delivery of the goods, the recipient signs the delivery note to acknowledge receipt and thereafter she would then issue an invoice. Making reference to the annextures to the plaint, she gave details of the deliveries she made to the defendant through the LPOs issued by the defendant and which payments were not effected and the documents involved as follows: 1. LPO No. 2106 of 26/08/2008, delivery note No. 0055 and corresponding invoice of even number dated O1/09/2008 for Tshs 62,000/=; 2. LPO Nos. 2121 and 2122 of 21/11/2008 .for Tshs 115,800/=, delivery note No 0078 and corresponding invoice of even number dated 24/11/2008 for Tshs 115,800/=; 3. LPO Nos. 2118 and 2119 of 21/11/2008 for Tshs 140,000/=, delivery Note No 0079 and corresponding invoice of even number dated 21/11/2008; Page 6 of 27 4. LPO No. 2120 of 21/11/2008 for Tshs 68,000/= delivery note No 0080 and corresponding invoice of even number dated 21/11/2008, for Ths 68,000/=; 5. LPO No. 0801 of 28/10/2008 for Tshs 600,000/=, delivery Note No. 0083 and corresponding invoice of even number dated 10/12/2008 for Tshs 600,000/=; 6. LPO Nos. 0858 and 0859 of 10/12/2008 for Tshs 1,248,800/=, , delivery note No. 0085 and corresponding invoice of even number dated 10/12/2010 of Tshs 1,248,800/=; 7. LPO No 0862 of 16/12/2008 for Tshs. 148,000/=, Delivery Note No. 0089 and corresponding Invoice of even Number, dated 30/12/2008 of Tshs. 148,000/= ; 8. LPO Nos. 0707 and 0708 of 02/12/2008 for Tshs 1,447,000/=, delivery note No 007 6 and corresponding invoice No 0096 of 15/01/2009 for Tshs 1,447,000/=; Page 7 of 27 9. LPO Nos. 0895 and 0896 of 29/12/2008 for Tshs 251,600/=, Delivery note No O111 and corresponding invoice of even number dated 30/01/2009 for Tshs 251,600/=; 10. LPO Nos. 0708 and 0709 of 10/01/2009 for Tshs 1,653,000/=, Delivery Note No O112 and corresponding invoice of even number dated 15/01/2009 Tshs 1,653,000/=; 11. LPO Nos. 0806, 0807 and 0808 of 23/10/2008 for Tshs 1,842,500/=, Delivery Notes No 0114 and 0117 and corresponding invoices of even numbers dated 11/02/2009 for Tshs 1,842,500; 12. LPO No. 0816 of 22/01/2009 for Tshs 145,500/=, Delivery Note No. 0015 and corresponding invoice of even number dated 12/02/2009 for Tshs 145,500/=; 13. LPO No. 0817 of 02/01/2009 for Tshs 106,000/=, Delivery Note No 0131 and corresponding Invoice of even number dated 03/03/2009 for Tshs 106,000/=; Page 8 of 27 14. LPO Nos. 0825 and 0826 of 20/02/2009 for Tshs 2,929,000/=, Delivery Note No 0132 and corresponding Invoice of even number dated 07/03/2009 for Tshs 2,929,000/=; 15. LPO No. 0818 of 23/01 /09 for Tshs 100,000/=, Delivery note No O136 and corresponding Invoice of even number dated 09/03/2009 for Tshs 100,000/=; 16. LPO Nos. 2167 and 2168 of 16/03/2009 for Tshs 805,000/=, delivery Note No 0140 and corresponding invoice with even number of 10/03/2009 for Tshs 805,000/=; 17. LPO No. 0966 of 27/03/2009 for Tshs 71,200/=, delivery Note No 0156 and corresponding invoice of even number of "- j 06/04/2009 for T shs 71 ,200/=; 18. LPO No. 0907 of 01/02/2009 for Tshs 259,500/=, delivery Note No O158 and correspondig invoice of even number of 09/03/2009 for Tshs 259 ,500/=; Page 9 of 27 - 19. LPO No. 1743 of 03/06/2009 for Tshs 1,502,000=, delivery Note No 0173 and corresponding invoice of even number of 20/06/2009 for Tshs 1,502,000/=; 20. LPO No. 0911 of 20/05/2009 for Tshs 487,000/=, delivery Note No 0174 and corresponding invoice of even number of 29/05/2009 for Tshs 487,000/=; 21. LPO Nos. 0973 and 0974 of 29/05/2009 for Tshs 1,245,000/=, delivery note No 0192 and corresponding invoice of even number of 19/06/2009 for Tshs 1,245,000/=; 22. LPO No. 0978 of 12/06/2009 for Tshs 640,000/=, delivery Note No 0196 and corresponding invoice of even number of 24/06/2009 for Tshs 640,000/=; 23. LPO Nos. 1303 and 1304 of 05/10/2009 forTshs 2,521,000/=, delivery Note No 0240 and corresponding invoice of even Number of 30/l 0/2002 for Tshs 2,521,000/=; Page 10 of 27 24. LPO No. 2401 of 27/10/2009 for Tshs 78,500/=, delivery Note No 0254 and corresponding invoice of even Number dated 01/12/2009 for Tshs 78,500/=; 25. LPO Nos. 2452, 53, 54, 55, 56, 57, 58 and 2459 of 18/01/2010 & 19 /01/2010 for Tshs 24,264,400/=, delivery Notes Nos. 0265, 0266, 0267, and 0271 and corresponding invoices of even numbers 0265, 0266, 0267 and 0271 of 20/01/2010 for Tshs 24,264,400/=; 26. · LPO Nos. 1318 & 1319 of 04/01/2010 for Tshs 2,673,300/=, delivery note no 0269 and corresponding invoice of even Number for Tshs 2,673,300/=; 27. LPO No. 2286 and No 2287 for Tshs 2,772,000/= and Tshs 3,390,000/= of 09 /07 /2010, delivery note No 0271 and corresponding invoice of even No dated 25/07/2010 of Tshs 3,390,000/=; Page 11 of 27 28. LPO Nos. 2462 & 2463 of 30/01/2010 for Tshs 19,546,400/=, delivery Note Nos. 0277 & 0278 and corresponding invoices of even Numbers for Tsh 19,546,400/=; 29. LPO Nos. 2464, 2465 & 2467 of 05/02/2010 of Tshs 4,470,300/= delivery note No 0284, 0285 and corresponding invoices of even Numbers dated 05/02/2010 of Tshs 4,470,300/=; 30. LPO No. 1422 of 10/07/2010 for Tshs 12,900,000/=, delivery Note No 0322 and corresponding invoice of even number of 09/08/2010 for Tshs 12, 900,000/=; 31. LPO No. 2469 of 13/02/2010 for Tshs 452,000/=, delivery "' ,,;," Note No. 0290 and corresponding invoice of even Number dated 27/02/2010 for Tshs 452,000/=; 32. LPO No. 247 6 of 03/02/2010 for Tshs 394,000/=, delivery Note No. 0294 and corresponding invoice of even Number dated 23/03/2010 for Tsh 394,000/=; Page 12 of 27 33. LPO No. 17 60 of 08/06/2009 for Tshs 163,000/=, delivery Note No 0295 and corresponding invoice of even Number dated 09 /06//2009 for Tshs 163,000/=; 34. LPO Nos. 2478, 2479, 2480 for Tshs 1,798,000= dated 01/03/2010, Delivery Note no 0296 and 0297 together with the corresponding invoices of even number dated 01/03/2010 Tshs 1,798,000/=; 35. LPO No.1403, 1404, 1405 and 1406 of Tshs 9,630,800/=, Delivery Note No. 0304 and 0305 and corresponding Invoice of even Numbers dated 29/03/201 O; 36. LPO No. 1317 dated 04/02/2010 for Tshs 91,500/=, delivery Note No. 0309 and corresponding Invoice of even No. dated 01/02/2010 for Tshs 91,500=; 37. LPO NO 1407 and 1408 dated 19/04/2010 for Tshs 7,507,500/=, delivery Note No. 0310 and corresponding invoice No. dated 07/04/2010 for Tshs 7,507,500/=; Page 13 of 27 38. LPO Nos. 1744 and 1745 of 23/06/2009 for Tshs 7,220, 182/=, delivery Note No. 0311 and corresponding invoice of even number dated 14/07/2009 for Tshs 7,220, 182/=; 39. LPO No. 1406 of 19/04/2010 for Tshs 35,370,000/=, delivery Note No 0312 with corresponding invoice of even Number dated 18/04/2010 for Tshs 35,370,000/=; 40. LPO Nos. 1410, 1411, and 1412 of 21/04/2010 for Tshs 39,090,200/=, delivery Note No 0315 and 0316 and corresponding Invoice of invoice No dated 20/04/2010 for Tshs 39,090,200/=; 41. LPO No. 2428 of 29/06/2010 for Tshs 12,305,500/=, delivery Note No 0324 and corresponding Invoice with even Number dated 30/06/2010 for Tshs 12,305,500/=; 42. LPO No. 1458 dated 19/06/2010 for Tshs 2,320,000/=, delivery note No. 0338 and corresponding invoice of even Number dated 22/06/2010 for Tshs 2,320,000/=; Page 14 of 27 43. LPO No. 0800 of 25/05/2010 for Tshs 1,800,000/=, delivery Note No 0340 dated 28/06/2010 and corresponding invoice of even number dated 26/06/2010 for Tshs 1,800,000/=; 44. LPO Nos. 0938, 0939, 0940, of 16//06/2010 for TSh 860,000/=, delivery Note Nos. 0342 and 0343 and corresponding invoice of even Nos. dated 13/07/2010 for Tshs 860,000/=; 45. LPO Nos. 2260 and 2261 of 17/5/2010 for Tshs 3, 102,000/=, delivery Note No. 0352 with corresponding invoice of even No. dated 30/05/2010 for Tshs 3, 102,000= PWl prayed to tender the above documents which were admitted according to their respective Volumes as: Exhibits; Pl A (Vol. 2), Pl B (Vol. 3), Pl C (Vol. 4), Pl D (Vol. 5), Pl E (Vol. 6), Pl F (Vol. 7) and Pl G (Vol. 8) respectively. PW 1 concluded her evidence by stating that efforts to follow up payments proved futile as the OED kept on giving unimplemented promises. She resorted to seeking advice from her lawyers who wrote Page 15 of 27 a demand letter, but still it did not help. She thus preferred the present suit. She lamented that due to the non-payment by the defendant, she had been exposed to unpaid debts, she failed to repay her bank loan which led to her house been auctioned and had to sell her car. She thus prayed for the payment of Tshs. 231, 173,985/=, damages to the tune of Tshs. 200,000,000/= for the damages suffered, interest at the rate of 30%, commercial rate and the costs of the suit. Upon being cross examined by Ml. Maganiko, learned counsel, PWl insisted that she had been supplying goods to the government since 2000. She however conceded that she was not conversant with the procedure involved in trading with the government. She admitted that LPO'S, delivery notes and invoices are documents which are issued in sequence but in practice some of the processes are skipped and formalized later. She gave example of the times of emergency arguing that the procedures were not observed, citing as example LPO No. 2459 dated 18/01/2010 relating goods worth Tshs 24,264,400/=, Delivery Note No 2067 dated 20/07/2010. In further Page 16 of 27 .· J cross examination, she said that she had misplaced some of her records and also some documents were obtained after instituting the case, adding that some documents could still be missing. She admitted that LPO Nos. 1407, 1408 and 1409 dated 19/4/2010 bear a wrong date in the pleadings blaming the person who prepared the r•~,\ pleading for the omission. She however said that in practice she has been supplying goods before being issued with the requisite LPOs. In re-examination, PWl insisted that it is not uncommon for goods to be supplied or delivered prior to the signing of the LPO by the authorized officers, in such situation, the Delivery Note might preceed the LPO's date. She however maintained that it never occurred that goods were returned due to the absence of LPO. This marked the end of the plaintiff's case. Accordingly the plaintiff's was marked closed. The defence case was led by Mr. Prosper Msivala, learned counsel, as intimated, it also comprised of one witness,_ Mr. Makiwa Rajabu who testified as DWl. Being led by his counsel, DWl said he is employed as Assistant Procurement Officer, Kilosa District Council. His Page 17 of 27 J 11\ testimony was to the effect that; as per procedure, between 2009 and 2010 the Council was ordering goods through the Local Purchasing Orders (LPO) which involved preparation of quotations which were then issued to more than 3 suppliers. After getting the feedback from the suppliers the Council will appoint the winner then ---.. 1 , prepare LPO. He explained that a valid LPO normally has 3 signatures from three different officers, namely; the Chief Accountant, the Head of Department and the Director of Municipal Council. After the preparation of the LPO the supplier is served with a copy while the original is retained by the office. The supplier who has been issued with LPO delivers supplies in terms with the LPO and upon delivery; he issues a delivery note and raises an Invoice. On his part, the purchaser (Council) upon receipt of the goods, it prepares a Receipt Voucher. Payment is processed using the original copies of; quotations, LPO, Invoice, Receipt Voucher and Delivery Note signed by the person who received the goods. DWl testified further that for the payment to be processed, all the named documents have to be attached, adding that if for any Page 18 of 27 reason one of the required documents is missing, payment cannot be processed. He went on _tha_t in 2009 during the flood,calomity he was involved in receiving supplies from three suppliers i.e. Masanga General Supplies, Ahmed Bhahamis and Richard Muyonga. DWl said that during that period, the Council had other sources of funds from different donors such as the Prime Minister's Office, Red Cross Islamic Foundation and others. He admitted that some of those who supplied goods during that period had not been paid to date. He however remembers that Masanga General Supplies was paid about 87million. DWl conceded that the plaintiff had a genuine and verified pending claim which had not been effected and to his recollection she deserves to be paid about Tshs 194,000,000/= out of which Tshs. 170,000,000/= was the amount arising from the flood calamity which ought to be paid by funds from the Prime Minister's office which had not been disbursed and about Tshs. 20 million was from other minor supplies made to the Council. During cross examination DWl said that for an LPO to be paid, it requires the requisite attachments, including; invoice and delivery Page 19 of 27 J. J note which are to be produced by the supplier and the LPO is issued by the council. He went on that all payments were to come from the Prime Minister's Relief Department Office. DWl maintained that he was only aware of the plaintiff's claim of Tshs 194,000,000= and not the amount over 250,000,000/= which she is claiming in the plaint. He said that the reason for the failure to pay is because the Prime Minister's Office has not disbursed the money. He admitted that the claim has remained pending for a long time and has caused inconveniencies to the plaintiff. At this juncture, the defence also rested its case. The same was accordingly marked closed. I have thoroughly pondered over the evidence presented by both sides and what seems common between the parties is that the plaintiff was engaged by the defendant to supply various goods for a long period time between 2002 and 201 O; this is vividly borne by the testimonies of PWl and DWl who were at one with regard to this arrangement. The 1st issue; whether the Plaintiff was requested by the defendant to supply various goods to the defendant and she did Page 20 of 27 J supply the same on credit basis, is thus without any doubt answered in the affirmative. With regard to the 2nd issue, whether the Defendant paid for all the goods supplied by the plaintiff to the defendant on credit basis. I have no doubt from the totality of the adduced evidence the answer is in the negative. In his testimony, DWl was candid enough to concede that the defendant is yet to effect payments to some of the goods supplied by the plaintiff due to lack of funds. DWl testified further to his recollection at his office there was the plaintiff's verified claim of Tshs 194,000,000/= awaiting payment. PWl tendered in court various exhibits which clearly established that she had not been paid for most of the supplies she delivered between 2008 and 2010. In my opinion, with the clear admission of the existence of the debt owing to the plaintiff by DWl, the answer to the 2nd issue is unequivocal that indeed Plaintiff was not paid for part of the good supplied. That is however not the end of the matter as there is still a need of establishing the actual payment due to the plaintiff. What need to be answered is thus whether the plaintiff has established the Page 21 of 27 actual claim owed to her considering that in the plaint she pleaded a sum of Tshs 262,598,682/= while in her oral evidence in court she reduced the same to Tshs 231, 173,985/= without giving clarification for the change. As intimated, DWl gave an unsolicited admission to the claim of Tshs 194,000,000/= which he agreed was a genuine t--.. verified claim supported by all the requisite documents pending for payment in favour of the plaintiff at the defendant's office. In view of the above reality where the plaintiff's pleaded claim vary from the one presented in court, I have found it prudent to look at all the documents relating to the transactions relied upon by the plaintiff to support the claim. According to DWl who is an expert in the area, for a claim to qualify for payment, it has to contain the original copies of the following documents, namely; requisition document, LPO, Invoice, Receipt Voucher and Delivery Note signed by the person who received the goods. Having scrutinized closely the list of LPOs relied upon by the plaintiff as revealed in Items l to 45 herein above, I have found that there are some which do not meet Page 22 of 27 the procedural requirements explained to qualify processing payments; just to mention a few: 1. The claim in Items 8 and 10 appear to refer to the same LPO ' i.e. LPO. No. 9708; 2. The claim on item No 23 issued in the year 2009 delivery, is backed up by a delivery note dated 2002; 3. The claim on item No 27, refer to 2 LPOs but backed up by only one delivery note; 4. The claim on item No 29, relate to 3 LP Os but only 2 delivery notes and invoices were issued. 5. The claim on item No 34, relate to 3 LPOs but only 2 delivery notes and invoices were issued. 6. The claim on item No 35, relate to 3 LPOs but only 2 delivery notes and invoices were issued. 7. The claim on item No 37, relate to 2 LPOs but only 1 delivery note and invoice was issued. Page 23of 27 8. The claim on item No 38, relate to 2 LPOs but only 1 delivery note and invoice was issued. 9. The claim on item No 40, relate to 2 LPOs but only 1 delivery note and invoice was issued. 10. The claim on item No 44, relate to 3 LPOs but only 1 delivery note and invoice was issued. 11. The claim on item No 45, relate to 2 LPOs but only 1 delivery note and invoice was issued. Having noted the above discrepancies in the plaintiff's documentary evidence, I am justified to conclude that on the face of the pleadings some of the items did not meet the criteria for payment set by the Council of ensuring that the originals of each requisite document is attached to the claim for payment. It is for that reason that I am inclined to the view that plaintiff has not proved to the required standard the claim of Tshs 231, 173, 985/= she told the court in her evidence she deserves to be paid by the defendant. Page 24 of 27 I With regard to the third issue, whether the Plaintiff suffered any damage as a result of the defendant's act of not paying money for the supplied goods if any on credit basis, I am satisfied that under the circumstances of this case, this issue must be answered in the positive. I am saying so because if the defendant held the plaintiff's r ---.. money since 2008 or 2010, clearly this must have inconvenienced the plaintiff a lot being a business person, in addition to the fact that she kept on following up the issue for a long time up to when she resolved to file this suit in court. Looking at the defence evidence, I have wondered the reason for not paying while there is a clear admission of the substantial part of the claim. For that reason the answer to the issue is in the positive that plaintiff suffered damages. It is for that reason that I agree plaintiff deserves some redress. Under the circumstances of this case, having found that a number of the pleaded documents have not met the threshold set to justify payment, I fail to see how the claim of Tshs 262,598,682/= pleaded in the plaint or even the sum of Tshs 231, 173,985/= presented in court by the plaintiff could be sustained. I have however considered the Page 25 of 27 clear admission by DWl that there was a genuine verified claim of Tshs 194,000,000/= pending payment lying in DWl 's office in favour of the plaintiff, I think it will be injustice if such amount is not allowed. I am thus satisfied that the evidence available justifies the grant of verified amount of Tshs 194,000,000/= admitted under oath by DWl. Consequently, with regard to the last issue of, to what reliefs are the parties entitled to; I enter judgment in favour of the plaintiff for the following reliefs: (a) Defendant to pay the plaintiff the verified amount of Tshs 194,000,000/=, being the admitted established claim pending in favour of the plaintiff. (b) Payment of general damages to the tune of Tshs 40,000,000/=. (c) Interest of item (a) at the commercial rate obtaining at the time of the supply of goods and date of judgment. (d) Interest on (a) at the rate of 7% from the date of judgment to the date of full payment. Page 26 of 27 (e} Costs to follow the event. It is so ordered. JUDGE 31/8/2017 Judgment delivered in chambers in the presence of Mr. Nazario Michael, learned counsel for the plaintiff and in the absence of the defendant this 31/8/2017. 31/8/2017 Page 27 of 27