eco bank t ltd vs rz electrical tech ltd and 3 others 2021 tzhccomd 3463 19 november 2021

IN THE HIGH COURT OF TANZANIA (COMMERCIAL DIVISION) AT PAR ES SALAAM COMMERCIAL CASE NO. 167 OF 2018. ECO BANK TANZANIA LIMITED.................................... PLAINTIFF VERSUS RZ ELECTRICAL TECH LIMITED.......................... 1st DEFENDANT MILE SOLUTIONS COMPANY LIMITED............. 2nd DEFENDANT RAMADHAN AMIR MRISHO.............................. 3rd DEFENDANT BAKARI MOHAMED BAKARI................................4th DEFENDANT Date of Last order: 20/10/2021 Date ofJudgement: 19/11/2021 JUDGEMENT MAGOIGA, J. The plaintiff, ECO BANK TANZANIA LIMITED by way of plaint instituted the instant suit against the above-named defendants jointly and severally, praying for judgement and decree in the following orders, namely:- I. Declaration that:- a. The 1st defendant breached the credit facility agreement by its failure to discharge its duties and obligations in accordance with such agreement. i b. The 2nd defendant breached the Corporate Guarantee and indemnity by failure to comply with the terms, conditions and covenants of the guarantee especially on payment of the entire amount of the outstanding amount of the credit facility following the default by the 1st defendant. c. The 3rd and 4th defendants each breached the joint and several personal guarantees by failure to comply with the agreed terms, conditions and covenants of guarantee especially on payment of the entire amount of the outstanding amount of the credit facility following default by the 1st defendant. i. The defendant to be ordered to immediately pay the plaintiff the whole outstanding amount of the credit facility which is TZS 417,542,659.03 (Say Tanzania shillings Four Hundred Seventeen Million Five Hundred Forty Two Thousands Six Hundred Fifty Nine Shillings three cents only) being the principal amount of the outstanding credit facility ano interest as of 1st November, 2018. ii. The defendants to be ordered to pay late payment charges and interest on the unpaid sum at the rate of 2% per month in addition to late payment charges from the date of the breach. iii. That the defendant be ordered to pay the plaintiff general damages as assessed by court to cover the loss the plaintiff 2 suffered for the defendant's failure to discharge their duties and obligations as agreed. iv. The defendants to be ordered to pay the plaintiff interest on decretal amount from the date due to the date of fully payment thereof at the prevailing commercial rate. v. The defendants to be condemned to pay the plaintiff costs of this suit vi. Any other relief(s) that the honourable court may deem fit Upon being served with the plaint, the 1st, 3rd and 4th defendants filed joint written statement of defence disputing all plaintiff claims on the grounds that loan agreement between plaintiff and 1st defendant is illegal for want of board resolution and that even the amount illegally loaned was paid back fully by the 1st 3rd and 4th defendants. Upon being served with the plaint, 2nd defendant filed a written statement of defence disputing plaintiff's claims on grounds that 1st 3rd and 4th defendant has already fully repaid the loan from the proceeds of TAN ESCO project. On that note, all defendants invited the plaintiff into strict proof of her claims thereof and eventually prayed that the suit be dismissed with costs. 3 The facts of the case are not complicated and I find it apposite to narrate them for better understandings the gist of this suit. According to the plaint, it was averred that, on 27th June 2014, plaintiff and 1st defendant executed a loan agreement in respect of Contract Finance and Performance Bond Guarantee in which the plaintiff advanced TZS. 570,320,418.00 to the 1st defendant and the performance bond guarantee of TZS.229,675,582.00 collectively referred as the loan. Facts go that, on 3rd July, 2015 the said credit facility were varied and the tenor of the outstanding balance was extended for period of three months subject to terms and condition contained in the facility latter dated 27 June 2014. Further were that on 16th August, 2016 the credit facility was varied and the tenor of the outstanding balance was extended for period of five months with the condition contained in the deed of variation. The aforesaid loan facilities were secured by various legal securities which were:- The first ranking debenture over all current, future, fixed and floating assets of the 1st defendant; Assignments and irrevocable domiciliation of contract receivables due from TANESCO; Irrevocable and unconditional corporate guarantee and indemnity of Mile Solutions Company Limited (2nd defendant); irrevocable and unconditional 4 personal guarantees and indemnity of the directors of the 1st defendant (3rd and 4th defendants); Negative pledge undertaking over the 1st defendants assets not to dispose without prior consent of the plaintiff; Lien, Pledge, Set off of all accounts of the 1st defendant and specific charges over five vehicles owned by the 2nd defendant with legislation number T984 CMJ, T728 AUQ, T422CFV, T205 CHT and T643 CDJ. Desp.te the plaintiff observing the terms and conditions of the credit facility and the 1st defendant enjoying and utilized the money disbursed, the 1st defendant defaulted in repayment of the amount due to the plaintiff which act constituted an event of default under clause 18 (a) of the credit facility letter and clause 10(1) of the debenture. Even efforts by plaintiff through his lawyers to have the money paid were in vain, hence, this suit claiming the prayers as contained in the plaint. The plaintiff at all material time has been enjoying the legal services of Dr. Onesmo Michael Kyauke, learned Advocate. On the other adversary part, the 1st, 3rd and 4th defendants at all material time were enjoying the legal service of Mr. Kasaize Andrew Kasaize, learned advocate. And the 2nd defendant at all material time has been enjoying the legal service of Mr. Richard Kinawari, learned advocate. 5 Before hearing started, the following issues were framed, recorded and agreed between the parties for determination of this suit, namely:- 1. Whether there was any legal and binding credit facility agreement between the plaintiff and 1st defendant. 2. If the 1st issue is answered in affirmative whether the 1st defendant has paid all the amount in the said contract. 3. If the 1st issue is answered in negative whether the 1st defendant illegally paid the alleged loan. 4. If the 1st issue is answered in affirmative whether there was any legal and binding guarantee agreement between the plaintiff and the 2nd, 3rd and 4th defendants. 5. Whether the suit is maintainable for want of board resolution from plaintiff to sue defendants. 6. Whether there was board resolution from the 1st defendant to borrow money or to enter into such agreement with the plaintiff. 7. To what reliefs are the parties are entitled. The plaintiff in proof of her case called one witness. This is Mr. PASTORY CHRISTOPHER OKUDO (to be referred in these proceedings as "PWI". PW1 through his witness statement adopted in 6 these proceedings as his testimony in chief told the court that, he is the plaintiffs Recovery Officer, hence, conversant with the fact of this case. PW1 went on to testify that on 30th June, 2014 plaintiff and the 1st defendant entered into two credit facilities, the first one being in form of contract finance loan amounting to TZS.570,320,418.00 for the purpose of buying construction material and meet other operating costs for the projects and the second one being performance bond guarantee to the tune of TZS.229,675,582 for the purpose securing any claims by the l5t defendant's beneficiaries on the obligation arising from default in delivery or performance of the terms of the contract (TANESCO). The said loans were sanctioned by the board resolution of the 1st defendant dated 27th June, 2014. PW1 told the court that, the lstdefendant as principal borrower accepted terms and conditions as contained in the facility letter dated 27th June 2014 and the total amount of TZS. 570,324,418.00 were advanced to 1st defendant. According to PW1, the loan agreement was created at the time when the 1st defendant accepted offer letter from the plaintiff dated 27th June, 2014. DW1 went on to tell the court that, since the 1st defendant executed offer letter which was signed by the 3ra and 4th defendants 7 who are directors of 1st defendant together with the board resolution, then, a binding loan agreement was created between the parties. According to PW1, the said loans were secured by personal guarantees of the directors of the 1st defendants, namely; 3rd and 4th defendants herein, corporate guarantee of the 2nd defendant dated 30th June, 2014 backed by board resolution dated 16th June, 2014 creating a guarantor relationship with the plaintiff, dully registered debenture over the fixed and floating assets of the 1st defendant in favour of the bank, deed of receivables/proceeds of the 1st defendant and indemnity in favour of the bank. PW1 went further to testify that, the said credit facilities were subject to three variations; the first variation was for outstanding amount of TZS. 680,000,000.00 in the contract finance dated 3rd July, 2015 with the purpose of extending repayment of the outstanding amount under contract financing for period of three months subject to the terms and conditions of contained in credit facility dated 27th June,2014, and the second variation was made on 18th August, 2015 through the letter dated 3rd July, 2016 for the outstanding amount of TZS 654,035,926.00 on the contract finance and performance bond guarantee of TZS 229,676,000.00 with the purpose of extending the repayment tenor of> 8 these outstanding amount for period of five months. PW1 went on to point that, the third variation was made on 18th August, 2016 which was for the outstanding amount of TZS.654,035,926.00 on the contract finance and was accepted by the 1st defendant on 29th August,2016. It was further testimony of PW1 that, the said loan was secured by different securities, which are the The first ranking debenture over all current, future, fixed and floating assets of the 1st defendant, Assignments and irrevocable domiciliation of contract receivable due from TANESCO, Irrevocable and unconditional corporate guarantee and indemnity of Mile Solutions Company Limited, Irrevocable and unconditional personal guarantees and indemnity of the director of the 1st defendant ( 3rd and 4th defendants),Negative pledge undertaking over the 1st defendants assets not to dispose without Prior consent of the plaintiff, Lien, Pledge, Set off of all accounts of the 1st defendant and Specific charges over five vehicles owned by the 2nd defendant with legislation number T984 CMJ, 1728 AUQ, T422 CFV, T205 CHT and T643 CDJ. According to PW1, the said amount disbursed was the sum of TZS.569,905,430.00 on 16th October, 2014 as reflected in the bank statement of the 1st defendant account No. 0010135401513502 jh pVrk 9 maintained and operated within plaintiff's head office branch in Kinondoni. PW1 went on to testify by telling the court that, the 1st defendant was required to repay the fully amount by 17th January,2017 as per deed of variation dated 18th August,2016 unfortunately the plaintiff has failed to perform the terms of the contract as agreed to date. PW1 went on to testify that, despite the plaintiff complying fully with terms of the facility letter, the 1st defendant failed to service the two facilities in accordance with the terms of the facility letter as a result on 1st March, 2017 plaintiff served all defendants with formal demand notices seeking full payment of (TZS 559,833,84) which was outstanding amount under the two facilities by 15th January,2017. According to PW1, despite all notices issued the defendant failed and /or neglected to pay the outstanding amount due which as of 1st November,2018 stood at TZS 417,017,103.23 which is a principal sum plus interest. On the basis of the above testimony, PW1 prayed that this court be pleased to enter judgement and decree against all defendants as prayed in the plaint. In proof of the case the plaintiff tendered in evidence the following exhibits, namely:- .10 (a) The board resolution of RZ Electrical Tech Ltd dated 27th June,2014 as exhibit Pl; (b) Facility letter dated 27th June,2014 as exhibit P2; (c) Joint and several personal guarantee and indemnity as exhibit P3a-b; (d) Corporate guarantee and indemnity and board resolution of the guarantor Mile Solutionas Ltd as exhibit P4a-b; (e) Fixed and floating debenture dated 27th June,2014 and certificate Registration of charges as exhibit P5 a-b; (f) Deed of assignment of receivables/ proceeds dated 30th June, 2014 as exhibit P6; (g) Negative pledge of undertaking dated 30th June, 2014 as exhibit P7; (h) Letter of set off /lien/indemnity 30th June,2014 as exhibit P8; (i) Motor vehicle registration card as exhibit P9 a-d; 0) The affidavit for proofing a book is a banker's books and bank statement of the 1st defendant as exhibit PlOa-b; (k) Variation of the credit facility as exhibit dated 3rd Jully,2015, memorandum of acceptance dated 14th July 2015, acceptance by borrower dated 2nd July 2015 and memorandum of acceptance by guarantor as exhibit Plla-e; ii (I) Variation of the credit facility dated 16th August, 2015, acceptance of borrower, memorandum of acceptance by individual guarantor by Bakari Mohammedi Bakari, memorandum of acceptance by individual guarantor by Ramadhan Amir Mrisho, memorandum of acceptance by individual guarantor by Mile Solutions Company Limited as exhibit P12a-d; (m) Demand notice dated 1st March, 2017 as exhibit P13a-c; (n) Response letters from guarantors as exhibit P14a-c; (o) Demand notice for payment of outstanding loan as exhibit P15a-c, Under cross examination by Mr. Kasaize, PW1 told the court that, 1st defendant was loaned TZS 570,324,418 on 27th June, 2014 after fulfilling the conditions as stipulated in the offer letter. When asked about the letter of application, he replied that he don't have the application, however, he was quick to state that the letter offer was signed by Ramadhan, Amir Mrisho and Bakari Mohamed who are the directors of the 1st defendant. PW1 when pressed with question he replied that, there was a board resolution of the 1st defendant dated 27th June,2021 with the name of 12 Unifreight, (T) limited which is not a borrower. PW1 went on to tell the court that the 1st defendant has paid some amount but he does not recall how much but according to the records, the outstanding balance is TZS 417,017,103.23 which is the principal sum plus interest. PW1 when further pressed with more questions replied that, exhibit P4 which is company guarantee is dated 3rd June, 2014 means that it was executed after the money has been advanced to 1st defendant. PW1 went on to tell the court that most of securities are not stamped and that no motor vehicle has been sold as they were waiting for the court orders. PW1 when asked about the finance by the TANESCO, PW1 admitted that, ANESCO was paying the debt but she never paid all money due. Cross examination by Kinawari, PW1 when asked to read exhibit Pl he replied that it reads Unifreight (T) Limited. PW1 told the court that, they have never given the loan to MILE solutions Limited but tendered both board resolution and signed corporate guarantee by Mile Solution Ltd. Under re-examination by Mr. Kyauke, PW1 told the court that, exhibit Pl, is a board resolution of the RZ Electrical Tech Ltd as it bears the signature of the 1st defendant directors and same was prepared by directors who are Ramadhan, Amir Mrisho and Bakari Mohamed. Pressed with questions, PW1 told the court that the 1st disbursement was done , ■ 13 on 16th October,2014 to the tune of TZS 569,905,430 and there was extension of the loan to tune of TZS 680,000,000/= later on also there was restructuring of the loan of TZS 54,700,000. PW1 went on to tell the court that, the last restructuring was made on 30th September,2015 to the tune of 784,000,000/=. PW1 told the court that, personal guarantee together with the motor vehicles were security for the loan granted to 1st defendant. As to exhibit Pl la was signed by the directors of the company however it was not dated and that did not affect the genuiness. PW1 went on tell the court that, demand notice was served to both defendants and some amount was paid. On the basis of the above testimony, PW1 prayed that this court be pleased to enter judgement and decree against all defendants as prayed in the plaint, This marked the end of hearing of plaintiff case and same was marked closed. In defence, the 1st 3rd and 4th defendants were defended by Mr. RAMADHAN AMIR MRISHO and BAKARI MOHAMED BAKARI (to be referred in these proceedings as 'DW1' and 'DW2' respectively). DW1 under affirmation and through his witness statement adopted in the 14 proceedings as his testimony in chief told the court that, he is the Managing Director of the 1st defendant, hence, conversant with the case. It was the testimony of the DW1 that, there was no legal contract between plaintiff and the lstdefendant as the said loan agreement was entered without board resolution. DW1 went on to tell the court that, the resolution attached was a resolution for UNIFREIGHT Tanzania limited and not for the lstdefendant and therefore the contract was illegally entered for want of board resolution. DW1 further told the court that, despite illegal contract, however, 1st defendant has paid TZS 700,163,381 to plaintiff which is more than what is claimed. According to Dwl, the illegally claimed amount was illegally paid from the proceeds of all money collected from project of TANESCO through the 1st defendant account which is open in the plaintiff's bank. It was further testimony of DW1 that, plaintiff is aware that the contract between plaintiff and Tanesco is among contracts which were directly affected by the orders of the late president Magufuri because plaintiff was the one following the projects and all payments were directed to 1st defendant account which is open to plaintiff bank. According to DW1 15 there is no default on the part of 1st 3rd and 4th defendants as the 1st defendant has already paid TZS.700,163,381 which is the whole loan plus interest. Under cross examination by Mr. Kyauke DW1 denied to have borrowed or taken any loan from the plaintiff. When pressed with question DW1 told the court that, the amount taken was wrongly taken because it was in their bank account and they did not bother to claim it because they were working on it. Further, when pressed with more questions DW1 refused to have signed exhibit P12a and that he does not recognize the stamp in exhibit P14a because it is not in their headed paper. DW1 admitted to know Mile Solution Company Limited by name and they were working with them but he pointed out that he does not recognise their guarantee. Further under cross examination DW1 told the court that, exhibit PIO was prepared by the plaintiff. But when shown exhioit Pl he replied that it is the board resolution for Unifreight Tanzania Limited with headed paper of RZ Electrical Tanzania Limited but he admitted that para one reads RZ Electrical Tech Ltd and the second page was signed by Ramadhan Amir Mrisho. Nevertheless, DW1 denied to have signed it and 16 that the document is from Unifreight Tanzania Limited which has nothing to do with the 1st defendant. DW1 when shown exhibit P12a he identified it as a variation of credit felicity and under paragraph three is acceptance by borrower. Under re-examination by Kasaize DW1 insisted that they have never signed any loan contract with Ecobank neither signed exhibit P12a-c and exhibit pl4 a-c. When asked questions for clarification DW1 told the court that they never raised counter claim but they intending to file a case. The next defence witness is Mr. BAKARI MOHAMED BAKARI. DW2 under affirmation and through his two witness statements adopted in the proceedings as his testimony in chief told the court that, he is director of the 1st defendant and he is the 4th defendant hence conversant with the case. The rest of testimony of DW2 was more of that of DW1 on the status of the contract between 1st defendant and plaintiff. Under cross examination by Dr. Kyauke DW2 when shown exhibit PIO he identified it as a bank statement from Ecobank for RZ electrical Tech Ltd but denied to have borrowed any money from Ecobank and also, he .t 17 denied that the statement in paragraph 9 in his witness statement are not true as they have never taken any loan. DW1 when shown exhibit Pl told the court that headed paper looks like that of RZ Electrical Tech Ltd but it is not of RZ electrical Tech Ltd. When pressed with question he admitted that exhibit Pl was signed by Bakari Mohamed Bakari and Ramadhan Amir Mrisho but the signature in exhibit Pl is not his signature. DW1 went on to tell the court that, paragraph one of exhibit Pl refers RZ electrical Tech Ltd as one taking loan but denied the 1st defendant never borrowed any money. This marked the end of the 1st, 3rd and 4th defendants case and same was marked closed. The; next defence witness was Mr. FADHILI ANANIA SEMBAGO (to be referred in these proceedings as 'DW3'). DW3 under affirmation and through his witness statements adopted in the proceedings as his testimony in chief told the court that, he is Managing Director of the 2nd defendant and, hence, conversant with the facts of this case. It was the testimony of the DW3 that, the 1st defendant illegally paid the money which claimed by the plaintiff without any legal justification. DW1 went on to tell the court that, he was informed by the 1st ,3rd and 4th defendants on 6th April, 2018 1st defendant paid TZS.700,163,381. h 18 According to DW1, the amount paid by the 1st defendant was illegally paid for want of board resolution and that it was beyond the contractual agreement, if any. Testifying further DW1 told the court that, the 1st and 3rd defendant did not default on payment of TZS 417,542,659.3 because on 6th April the 1st defendant has paid TZS.700,163,381 to plaintiff. Furthermore, DW1 told the court that, although 1st defendant has illegally paid the plaintiff without board resolution it does not mean that the contract was legal. According to DW1, the absence of board resolutions for 1st defendant to borrow the said amount, and that of 2nd defendant to secure the said loan vitiates the loan agreement and all securities purported to secure the said loan. The rest of testimony of DW3 was more like of that of DW1 and DW2 on the status of the contract entered between 1st defendant and plaintiff without board resolution and that the 1st defendant has paid in fully the whole amount from proceeds all the money collected from the project of Tanesco. Under cross examination by Dr. Kyauke, DW3 after being shown exhibit P4 told the court that he does not remember to have guaranteed the 1st defendant but he recognize the exhibit P4 though dispute his signature therein. When asked to compare the signature in WSD and that in his 41 19 witness statement, DW3 unfortunately denied filing and signing WDS. Pressed with questions, DW3 told the court that the signature appearing in the WSD is forged one. Court noted DW3 was evasive of questions asked and only recognized his witness statement. Under cross examined by Mr.Kanawari, DW3 told the court that, no guarantee can be lawful without board resolution and insisted to have not signed any guaranteeing document. Nothing was re-examined by Mr. Kinawari. Asked by the court for clarification on whether it is true he never signed WSD, DW3 changed the story and admitted to have signed the WSD filed. This marked the end of hearing of defence case for 2nd defendant and same was marked closed. The learned advocated for parties' prayed to exercise their rights under rule 66(1) of this court Rules to file final closing submissions. I granted the prayer. I express my sincere gratitude to them for their industrious input on the matter. I will, in the course of answering issues, consider them but will not be able to produce them verbatim but suffices to say the same were well taken in determining this suit. $ 20 However, before going into issues, I noted that from the pleadings and testimonies of respective witnesses for parties and exhibits tendered in this sint, there are some of the facts which are not in dispute. I find imperative to state them because will help this court in answering issues in respect of this legal dispute. These are; One, there is no dispute that plaintiff advanced TZS 570,320,418.00 to the 1st defendant and the performance bond guarantee of TZS 229,675,582, collectively referred as the loan. Two, that there is no dispute that, the credit facilities were secured by different securities, the first ranking debenture, corporate guarantee and indemnity of Mile Solutions Company Limited, personal guarantees and indemnity of the director of the 1st defendant and Specific charges over five vehicles owned by the 2nd defendant with legislation number T984 CMJ,T728 AUQ, T422CFV,T205 CHT and T643 CDJ. Three, there is no dispute that the plaintiff deducted TZS 700,163,38l/=from the proceeds of all payment of TANESCO project. However, in the circumstances what is serious dispute between parties is the validity of credit facilities entered between plaintiff and the 1st defendant. The first issue was couched that, whether there was any legal and binding credit facility agreement between the plaintiff and 1 21 defendant. The defendants counsel is in strong submission that, there was no valid credit facility in three folds. First, the loan agreement was not supported by board resolution of the 1st defendant directors; two, no letter requesting the loan from plaintiff; and three, the credit facility agreement had no stamp duty. According to defendants learned counsel, these impediments are ratal to agreements and render the credit facility inoperative and hence no valid contract between plaintiff and first defendant. On the other hand, the plaintiff has disputed those impediment's and strongly submitted that, the error in board resolution, has nothing do with the validity of credit facility because the heading of resolution refer RZ Electrical Tech Ltd and same was signed by directors of the 1st defendant. I have scrutinized exhibit Pl and noted that it belongs to RZ Electronic Tech Limited. The reasons for taking this instance are not far-fetch. One, the misdescription of the 1st defendant in exhibit Pl was typing error because the particular error is not reflected in the text of the document, the title and what was resolved in that meeting is all about the 1st defendant taking loan from the plaintiff. Not only that but also the name of Unfreight Tanzania Limited appeared once in exh-bit Pl, if 22 at all the resolution was made by the directors of Unfreight, then, one would have repeated in text of exhibit Pl. Two, the names and signature of Ramadhan Amir Mrisho and Bakari Mohamed Bakari who are directors of the 1st defendant are same featuring in the board resolution. Exhibit P2 and exhibit 11, then, if the board resolution belongs to directors of Unfreight Tanzania Limited its obvious that the names of directors of the 1st defendant could not be featured in the board resolution of Unfreight Tanzania Limited, so since the names and signature of the directors are the same and what was resolved is about RZ electrical Tech Limited and obvious the name of Unfreight in exhibit Pl was a result of typing error and the allegation that the signature appearing in exhibit Pl does not belong to 1st defendant directors are mere statement because no evidence advanced by the directors 1st defendant to establish the same was forged signature. The settled position of law is that for a person to claim an action for forgery the particulars of forgery must be specifically pleaded and strictly proved. In this case the particulars of forgery were never pleaded, there has not been adduced any evidence to prove. 23 In the foregoing and in my strong considered opinion that, exhibit Pl beionqs to 1st defendant directors and therefore there was aboard resolution sanctioning the loan. The next fold, was on the letter request of the loan, the 1st defendant submitted that there was no valid agreement because there was no letter requesting the loan while on the other hand the plaintiff submitted that, the 1st defendant accepted offer letter from the plaintiff bank dated 27th June,2014 by sealing. I don't think that the contention has any merit. Truly, its trite law that contract arises when one makes an offer or proposal and another person accepts offer. The acceptance by offeree is what produces consensus ad idem, that is, agreement of parties on something as it is stipulated under section 10 of the Law of Contract [Cap 345 R. E. 2019] Thus, the subsequent question which does crop is whether there was offer requesting for the loan the answer is yes. The 1st defendant was offered a copy of prescribed credit facility letter contains terms and conditions which was to be returned to plaintiff within one month. On 30th day of June, 2014 the 1st defendant as a borrower accepted the offer on the following words and for easy reference, I will be reproduced those wards hereunder:- 24 "we the borrower hereby acknowledge the current amounts outstanding, under facilities and confirm having read and understood the terms and conditions contained in the letter and we pleased to accept such offer subject to the said terms and conditions" On that account, the 1st defendant expressly accepted the offer. I am aware that there are stages which has to be passed before an agreement between two contracting parties can amount to binding contract. Among those stages are proposal or offer which is made by offeror and acceptance which is made by offeree and the acceptance has to be clear as per section 7 of the Law of Contract Act [ CAP 345 R. E. 2019]. Therefore, since the 1st defendant accepted the offer in the mode prescribed by the plaintiff there was valid contract, I unhesitatingly declare that there was valid agreement between parties. The last fold was on unstamped credit facility, the 1st defendant has submitted that the credit facility was not stamped and therefore should not decide the rights of the parties. This fold will not retain me because it was supposed to be raised at hearing stage. Raising it now at the 25 stage of writing judgement it's an after sought and cannot be entertained without prejudicing parties. In totality of the above reasons, the first issue must be and is hereby answered in affirmative that there was legal and binding credit facility agreement entered between plaintiff and the 1st defendant. This takes this court to the 2nd issue which was couched that 'If the 1st issue is answered in affirmative whether the 1st defendant has paid all the amount in the said contract? Plaintiff alleged that defendant have not paid the outstanding balance. In rebuttal the defendants have argued that plaintiff without any authority has deducted TZS-700,163,381.00. According to evidence tendered and exhibits, on 19th February, 2016 Tanesco made a payment of TZS. 335,620.411.9 and the loan was accordingly deducted. However on 29th Auqost, 2016 another loan was disbursed to the tune of TZS. 654,035.925.80 and the 1st defendant made some payments making the unpaid balance to stand at the tune TZS. 417,017,103.23 as exh:bited in exhibit PlOa. This issue must be and is hereby answered in negative that the 1st defendant paid all the amount in the said contract. Next issue number 3 which was couched that 'If the 1st issue is answered in negative whether the 1st defendant illegally paid 26 the alleged loan. This issue will not detain this court much. Much as I have already held that, there was valid credit facility "exhibit P2". The issue of illegality dies natural death and any amount paid, was, therefore, legally paid. This trickles to issue number 4 which was couched thus, 'If the 1st issue is answered in affirmative whether there was any legal and binding guarantee agreement between the plaintiff and the 2nd, 3rd and 4th defendants. The defendants has submitted that no any legal and binding guarantee because plaintiff has failed to tender any application letter in the first place ,it was doubted on account of being founded on non -existing loan agreement. Much as what I have held above in issue 1 in relation to the first issue that exhibit P2 was valid agreement, then, it suffices in my view to hold that there was legal and binding guarantee, therefore this issue is answered in affirmative. This trickles to issue number 5 which was couched thus 'whether the suit is maintainable for want of board resolution from plaintiff to sue defendants?' The counsel for defendant has submitted that this suit not maintainable for want of board resolution, while the plaintiff counsel submitted that this suit is maintainable because there is legal 27 requirement that in order to sue the plaintiff must have a resolution but his rights are guided by the law rather than the resolution. The next issue number six couched thus, whether there was board resolution from the 1st defendant to borrow money or to enter into such agreement with the plaintiff. Following the answer in issue number one, this issue will not detain this court much as I have held that there was the attached board resolution belong to 1st defendant directors sanctioning the loan. The last issue was to 'what relief(s) are the parties are entitled?'. The defendants disputed all claims by the plaintiff on reasons which this court finds wanting of merits. Plaintiff claimed several reliefs as contained in the plaint jointly and severally against the defendants. Based on what have found and held above on all issues, then, without much ado, I allow this suit in favour the plaintiff in the following orders, namely:- 1. The 1st defendant breached the credit facility agreement by its failure to discharge its duties and obligations in accordance with such agreement. 2. The 2nd defendant breached the Corporate Guarantee and indemnity by failure to comply with the terms, conditions and.^ 28 covenants of the guarantee especially on payment of the entire amount of the outstanding amount of the credit facility following default by the 1st defendant. 3. The 3rd and 4th defendants each breached the joint and several personal guarantees by failure to comply with the agreed terms, conditions and covenants of guarantee especially on payment of the entire amount of the outstanding amount of the credit facility following default by the 1st defendant. 4. The defendants are ordered to immediately pay the plaintiff the entire outstanding amount of the credit facility which is TZS 417,542,659.03 (Say Tanzania shillings Four Hundred Seventeen Million Five Hundred Forty Two Thousands Six Hundred Fifty Nine Shillings three cents only) being the principal amount of the outstanding credit facility and interest as of 1st November, 2018. 5. The defendants are ordered to pay late payment charges and interest on the unpaid sum at the rate of 2% per month in addition to late payment charges from the date of the breach. 6. That the defendants are ordered to pay the plaintiff general damages to the tune of TZS. 10,000,000.00 disturbance caused to the plaintiff by reason of failure by the defendant's failure to discharge their duties and obligations as agreed. 29 7. The defendants are ordered to pay the plaintiff interest on decretal amount from the date due to the date of fully payment thereof at the prevailing commercial rate. 8. The defendants are condemned to pay the piaintiff costs of this suit. It is so ordered. Date at Dar es Salaam this 19th day of November, 2021 S. M.MAGOIGA JUDGE 19/11/2021 30