EAST YORKSHIRE COMM LTD VS BOCCO GENERAL TRADING LTD COMM CASE NO

IN THE HIGH COURT OF TANZANIA (COMMERCIAL DIVISION) AT DAR ES SALAAM COMMERCIAL CASE NO. 170 OF 2017 EAST YORKSHIRE COMMERCIAL LIMITED ......... PLAINTIFF VERSUS BOCCO GENERAL TRADING LIMITED ......... DEFENDANT EXP ARTE JUDGMENT 28/05/2018 & 09/07/2018 SEHEL, J. The present suit arose out of a contract for supply of various motor vehicles and machineries. It is the case of the plaintiff that sometime in November, 2018 the plaintiff entered into oral contract with the defendant for the supply on credit basis, various used motor vehicles including trucks, trailers, coaches, compressors, generators and other related i accessories and machineries (hereinafter referred to as “the Goods"), sourced from the United Kingdom. The plaintiff alleges that the defendant had an obligation to clear the goods, sell and then repay the plaintiff. The plaintiff further alleges that the business with the defendant went well but in November, 2012 the defendant stopped to make any repayment. The last payment is alleged to be made in the end of year 2012 which is sterling pounds 332,677.00 leaving a balance of sterling pounds 266,975.00unpaid. The plaintiff averred that despite repeated demands, the defendant failed to honour its obligation thus the present suit wherein the plaintiff claims for: a) Declaration that the defendant is in breach of an agreement entered into by and between the plaintiff and defendant for the supply of various motor vehicles, trucks, trailers and machineries made by the plaintiff to the defendant; b) An order for payment of Sterling Pounds 418,499.89 comprised of Sterling Pounds 266,975 being purchase price. 2 of the vehicles, trucks, trailers and machineries due and owing, together with interest on the purchase price at the rate of 8.5 % per annum and computed from 30th November, 2012 to the date of filing the suit; c) Payment of the sum of Tanzania Shillings Five Hundred Million (Tshs. 500,000,000) being compensation in respect of losses and damages which the plaintiff suffered, and continue suffering, following the defendant's failure to timely pay the outstanding amount when it became due and payable; d) Compensation for losses and damages and recovery of legal costs and consequential expenses suffered by the plaintiff in undertaking and pursuing legal action including, but not limited to legal fees and court fees for issuing proceedings and any other costs and expenses incurred; e) For payment of compound interest at the commercial rate prevailing at the date of judgment, or at such other rate as the Honourable Court may deem fit and just, accruing and 3 computed from the dote of filing the suit to the dote of payment in full; f) Costs of the suit. The defendant was dully served through registered post on 23rd November, 2017 but failed to file any defence in time. The registered post is the last a known address which the plaintiff had been communicating with the defendant. Therefore in terms of Section 82 (1) of the Interpretation of Laws Act, Cap. 1 read together with Order V Rules 21 and 30 of the Civil Procedure Act, Cap. 33 (hereinafter referred to as "the CPC") service was dully effected to the defendant but defaulted appearance as such on 13th day of February, 2018 the plaintiff was allowed to proceed exp-parte against the defendant. When the matter was coming for an ex-parte proof on 27th day of March, 2018, the counsel for the plaintiff notified the court they are in receipt of the written statement of defence which was filed on 21st day of February, 2018 after an order for ex- parte proof was made. He therefore prayed for the defence to be strike out. As there was already in place an order for ex-parte proof 4 then the defendant was required to apply to set it aside. The defendant failed to do so but instead it proceeded to file its defence without seeking the vacation of the ex-parte proof. The filing of the defence without seeking an order for setting aside ex- parte proof was improper. The written statement of defence is therefore strike out from the records for being illegally filed. Three issues were framed for the determination of the suit. These are: 1. Whether there was a contract entered between the plaintiff and the defendant for supply of motor vehicles, trucks, trailers, and machineries; } 2. Whether the defendant breached the terms of the contract for supply; and 3. To what reliefs are parties entitled. In order to prove its case and in compliance with rule 49 (2) of the High Court (Commercial Division) Procedure Rules, the plaintiff filed two witness statements of Simon Paul Singleton (PW1) and. 5 Deborah Elcock (PW2). Their witness statements were admitted on 11th day of May, 2018 when they appeared for cross examination. The testimony of PW1 was essentially such that he is a director of the plaintiff’s company and he met with Emil Bocco in 2003. Emil Bocco is a director of the defendant and that time PW1 had a company called Trans European Truck sales. The company at that time was dealing with selling trucks and other vehicles and Emil Bocco saw an advertisement for sale of Scania 113 truck in local UK magazines. It was the evidence of PW1 that Emil Bocco visited him and an arrangement for payment of the vehicle within three months was made of which Emil Bocco paid. PW1 said, Emil Bocco also introduced some of his friends to him and thereafter followed a close relationship between the two. PW1 said in 2004 Emil Bocco told him about his plan of returning home to Tanzania and PW1 expressed his intention of supplying trucks for him to sell in Dar es Salaam, Tanzania of which Emil Bocco positively replied with a response that he has customers, ready waiting for the trucks. PW1 further stated that they entered into gentleman’s agreement that PW1 would deliver the, 6 trucks to the UK port (Tilbury Docks, London) shipping would be around 21 days to Mombasa (Kenya) at Emil Bocco’s requests. PW1 said upon receipt of the goods, Emil Bocco would clear the vehicles and sell them then pay back the plaintiff. He also said business went on well as numerous shipments were made and in 2008 he closed Trans European Trucks in order to diversify to form a new company called East Yorkshire Commercials Ltd. It was the testimony of PW1 that the defendant dully honoured its obligation until November, 2012 when the defendant unilaterally started to stop making any payments thus leaving a balance of Sterling pounds 266,975.00. PW1 also tendered and were admitted: 1. Numerous email communications between the plaintiff and defendant (collectively Exhibit Pl); 2. Numerous Bill of Landing, invoices and list of trucks and machineries supplied to the defendant (collectively Exhibit P2); 3. Various bank transfers made by the defendant to the plaintiff (Exhibit P3); and 4. Two Demand notices (Exhibits P4 and P5). PW2 collaborated the testimony of PW1 that the defendant and the plaintiff had an oral business arrangement for supply of various motor vehicles and machineries whereby the plaintiff was supplied the same to the defendant on credit basis and upon resale the defendant pays back the plaintiff. Whether there was a contract entered between the plaintiff and the defendant for supply of motor vehicles, trucks, trailers, and machineries. The testimonies of PW1 and PW2 were not invalidated and or shaken by way of cross examination. We have evidence through the testimony of PW1 that there was an oral agreement entered for supply of motor vehicles, trucks, trailers, and machineries between the plaintiff and the defendant. Further Exhibit Pl shows that numerous motor vehicles and machineries were sent to the defendant. Part of Exhibit Pl reads: "Kindly while exporting for importation of units to Tanzania through Kenya indicate on the B/LS as shown below: Shipping Line- Rais Shipping Services Kenya Limited in transit to Tanzania via Boss Freight C.F.S". Exhibit P2 which are^ 8 invoices and bill of lading of various motor vehicles including trucks, trailers, coaches, compressors, generators and other machineries were sent and delivered to the defendant from the year 2008 to 2012. Section 5 (1) of the Sale of Goods Act, Cap. 214 provides: “Subject to the provision of this Act and any other written law in that behalf, a contract of sale may be in writing (either with or without seal or by word of mouth, or partly in writing and partly by word of mouth or may be implied from the conduct of the parties." In the matter at hand, as per the testimony of PW1, the plaintiff and the defendant through gentleman’s agreement entered into the contract for supply of motor vehicles including trucks, trailers, coaches, compressors, generators and other machineries. The gentleman’s agreement is further fortified by Exhibits Pl and P2 that clearly establishes that various items were sent and delivered to the defendant. Therefore issue number one is answered in the affirmative. 9 Whether the defendant breached the terms of the contract for supply oral agreement. I have held herein that the plaintiff and the defendant entered into oral agreement for supply of motor vehicles including trucks, trailers, coaches, compressors, generators and other machineries. PW1 and PW2 testified that it was a condition of the agreement that upon delivery of the goods, the defendant would clear and thereafter sell them and then pay back the plaintiff its money as per agreed price for each item. It is on records through the documentary evidences of Exhibits Pl, P2, and P3 that the defendant received the goods and managed to make part payment. In the case of Sangijo Rice Millers Company Limited Vs S.M Holdings Limited [2006] TLR 89 where Masati, J (as he then was) held: "The rules as to the delivery are set out in Section 31 of the Sale of Goods Act [Chapter 214)..... the general rule is that delivery of the goods may be made by the seller doing any act or thing whereby the goods are put into the custody or under the control of the buyer or his agent in that behalf. (See Atkinson . io Vs. Mailing), or whereby the buyer or his agent is enabled to obtain such custody or control. (See Smith Vs. Chance).” The defendant herein did receive the goods sent to it by the plaintiff as evidenced by the various invoices and bill of lading as per Exhibit P2. According to Exhibit P3 the defendant only managed to pay back Sterling pounds 332, 679 leaving a balance of Sterling pounds 269,500. In Millen Richard Vs Ayub Bakari Hoza [1992] T.L.R 385 the Court of Appeal of Tanzania held the appellant was in breach of contract by his act of denying to finalize the balance out of the agreed price in despite repeated demand letters sent by the respondent. In the matter at hand, it goes without saying that the defendant is in breach of the terms of the supply agreement despite being issued with repeated demand letters. Issue number two is therefore answered in the affirmative. Lastly I turn to the issue of reliefs. I will deal with each prayer separately: ii 1. For prayer (a) I have found herein that the defendant is in breach of the agreement, I thus proceed to declare that the defendant breached the agreement entered into by and between the plaintiff for supply of various motor vehicles including trucks, trailers and machineries. 2. I have also found that the goods supplied and which have not been paid for have an outstanding balance of Sterling Pounds 266,975. Therefore, the plaintiff is awarded this amount in full being purchase price of the motor vehicles, trucks, trailers and machineries due and owing to. 3. I also award interest of 8% per annum to be calculated from 30th November, 2012 to the date of judgment since if the money would have been deposited in the bank account it could have attracted such interest rate. 4. Prayers for compensation for losses suffered prayed under prayers (c) and (d) are hereby refused as I take that they are covered under item (3) herein, .v-., 12 5. For interest on decretal amount on court's rate, I award a simple interest rate of 7% per annum from the date of judgment till payment in full. 6. The defendant is also condemned to pay costs of the suit to the plaintiff. It is so ordered. Dated at Dar es Salaam this 09th day of July, 2018. 09th day of July, 2018 13