equity bank t ltd vs varlek holdings t limited 2022 tzhccomd 179 28 june 2022

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA (COMMERCIAL DIVISION) AT PAR ES SALAAM COMMERCIAL CASE NO. 09 OF 2022 EQUITY BANK (T) LIMITED.................................. PLAINTIFF VERSUS VARLEK HOLDINGS (T) LIMITED................. ...DEFENDANT Last order: 16th June, 2022 \ Z ' Judgment: 28th June, 2022 x x \ Z ~ DEFAULT JUDGMENT NANGELA, J:. This is default judgmentSaris6sz from a suit filed in this Court by the Plaintiff on the 03rd of February 2022. In it, the Plaintiff prays for Judgment and Decree against the Defendant, as follows: (l)z Payment of US$ 185,482.73 (United States Dollars One Hundred Eighty Five Thousand, Four Hundred Eighty Two Cents and Seventy Three) being Page 1 of 12 an amount due and owing to the Plaintiff from the Defendant. (2) Payment of the interest at the Commercial rate of 23% per annum and at the rate of 12% from the date it was due to the date of judgment. / X\\ (3) Costs of this suit. a x. ■ . (4) Any other order and relief(s) may this Honourable court deem fit and just to grant. . •' V „'s:< . f \ / '■ V'X v 7 The facts of this case may be briefly stated as follows. X 'V. On 31st /March, 2017, the Plaintiff and the Defendant entered into a Merchant Service Agreement whereby the Plaintiff supplied and allowed the Defendant to operate a Point of Sales (POS) Machine of the Plaintiff whereof the Defendant's sales would be paid electronically by Car holders to the Defendant's account held by the Plaintiff. Page 2 of 12 It was one of the terms of the said Merchant Service Agreement, which was later complemented by an indemnity agreement executed on the 31st March 2017 that, through the said POS Machines, the Defendant would be able to debit customers (Cardholders) using its services and/ or buying from the Defendant as online payments and thereafter submit to the Plaintiff \ such V. debits for encashment without waiting for payments from the respective Card hoi ders' banks. > It was also -agreed that, .the online payments made through POS Machine.and encashed by the Defendant to the Plaintiff' would later be repaid to the Plaintiff by the Cardholders^ banks upon confirmation of the sales made to the respective Cardholders. The parties had also agreed that, the Defendant was to keep and maintain records/proof of all transactions of the Cardholders that have used the services and authorized Defendant to debit their accounts through the POS. Page 3 of 12 Besides, the parties had agreed that, the Plaintiff settled the amount debited to the Defendant on the understanding that the transaction on the POS Machine was genuine and that, in case of any dispute, the Defendant had a duty to prove the respective Cardholder visited the Defendant's premises, authorized its card to be debited by attaching passport copy showing holders name - •v k\ \ and immigration entry stamp and invoice of spend. According to the Plaintiff,s the production of such proof and or documents was time bound and failure resulted in charge back of the amount credited to the customer (Cardholders). The Plaintiff made payments to the' Defendant amounting to USD 170,457.98 on the basis that, they were sales made by the Defendant to customers (Cardholders) whose cards were debited by the Defendant through POS Machine and that, their payments would be done to the Plaintiff by the said Customer's Banks once confirmed by the said Cardholders. Page 4 of 12 It is alleged that, in the course of the business transactions and as far as the POS are concerned, however, it came to pass that, the transactions and/or debits made by the Defendant through POS Machine were denied by the Cardholders for being fraudulently done by the Defendant. . ; . \\ /0> According to the Plaintiff, following the said'denials by - \- :\ V \ the said Cardholders, demand for. supporting5 evidence for disputed transactions from the said .customers through VISA, the Plaintiff contracted the Defendant to produce supporting . evidence/ documents that proves the transartions/leading to the debits and/or the alleged sales transactions ^ authorized by the Cardholders but the Defendant ignored, failed and or refused to provide the same, hence, this case. When the suit was called on for orders on the 16th June 2022, Mr Malimi, the learned counsel for the Plaintiff, prayed to the Court for leave to file an application for a Page 5 of 12 default judgment owing to the fact that the Defendant failed to enter appearance and never filed her Written Statement of Defence. The prayer was premised on Rule 22(2) (a) of the High Court (Commercial Division) Procedure Rules, GN. 250 of 2012 as amended by GN No. 107 of 2019. / . /<> This Court took note of the fact • ? /thfe Defendant X. \. that has never appeared in Court despiteXlzhere being a substituted service which* was published in the Citizen Newspaper dated 22nd <April 2022 and Mwananchi Newspaper bearing the same date. I therefore granted the prayer _and ;the Plaintiff filed Form No.l which is duly supported by ah> affidavit of Lucky Titus Kaguo and 'S( w Immaculata P. Sanye. I have looked at the affidavit and the attached documents which are in their original form. The attached documents in proof of the claim are Defendant's Bank statements (Exh.EBTL-2) in respect of Business current Page 6 of 12 Account No.3007211339783, dated 1st May 2022. The same was accompanied by an affidavit of Immaculate P. Sanye, a bank official for the Plaintiff in charge with the Plaintiff's computer systems issued in compliance with section 78, 78A and 79 of the Evidence Act, Cap.6 R.E 2019. Other documents relied on are the original Merchant Service Agreement (Exh.EBTL>1) dated 31st March 2017 and a formal demand notices (Exh.EBTL- 3) for payment dated 14th June 2018 and 13th July 2020. / ' x / Having carefully exarfiined the noted documents ' •. .. tendered in support of the claim, as well as the affidavit regarding proof ,of this claim, the issue which I am called upon to determine is whether the plaintiff is entitled to the prayers and .reliefs sought in Form No.l filed in this Court. Essentially, the filing of Form No. 1, seeking for a Default Judgment in favour of Plaintiff, is a matter of exercise of statutory right, open to the Plaintiff in a case where the Defendant(s) has declined to defend his case. Page 7 of 12 Under Rule 22 (1) of the High Court (Commercial Division) procedure Rules, 2012 (as amended, 2019) the law provides that: "Where any party required to file written statement of defence fails to do so within the specified\\ period or where such period has \ been extended accordance with7 "‘•’AS. V \ ’I \ V A, V \ sub- rule (2) ofrule 20, within tfe? period of such extension, the court may, upon proof of service and on application by.the plaintiff in form \No.l set out in the Schedule to J■i these Rules accompanied by an affidavit in proof of claim, enter judgment in favour of the plaintiff." From the above provision and, looking at the facts and evidence adduced in this case, it is clear to me that the Plaintiff has complied with the requirements of the above Page 8 of 12 cited Rule 22(1) of the Rules of Procedure governing this Court following the failure by the Defendants to file a Written Statement of Defense. I am convinced as well that, the evidence establishes the claims. There being no defense to counteract the claims owing to the Defendant's \:v-\x failure to appear and file her defense^ it -mean$- that/this suit is uncontested. \\ The Defendant's failure to act in .accordance with the requirements of Rule, 20-of the. High> Court (Commercial Division) procedure Rules, 2012 (as amended, 2019) is clearly evidenced by the fact that, she was granted an ample time.to file-her Written Statement of Defense but neyer showedxupjn Court or filed her statement of defense despite'being summoned by way of a substituted service and notice published in the CITIZEN NEWSPAPER dated 22nd April 2022 and MWANANCHI NEWSPAPER also dated 22nd April 2022. Page 9 of 12 I In view of the above observations, I am satisfied, that, the Defendant is liable to the Plaintiff and the Plaintiff is entitled to recover from the Defendant the outstanding amount due and owing. The issue I raised herein above, therefore, is responded to in the affirmative. In view of the above, and in terms of Rule 22 (p of the High Court (commercial Division) Procedure Rules, 2012 (as amended, 2019);.this Court enters judgment in favour of the Plaintiff and against the Defendant as follows: (1) /That, the Defendant is hereby x / ordered to pay the Plaintiff a total \ o!f US$ 185,482.73 (United States Dollars One Hundred Eighty Five Thousand, Four Hundred Eighty Two Cents and Seventy Three) being an amount due and owing to the Plaintiff from the Defendant. Page 10 of 12 (2) That, the Defendant is hereby ordered to pay the Plaintiff interest on the amount stated in No.l above at the Commercial rate of 14% per annum from the date it was due to the date of judgment. (3) That, the Defendant is hereby ordered to pay the Plaintiff a total z interest on the decretal amdunt\in No.l above 'at Court rate of 7% from the date it was due to the date of judgment. >" <i>x\ , •„ // (4)- The' Defendant is to pay costs of ' \ this suit. - Fu rther drder$\ (5.) '< That, in terms of Rule 22 (2) (a) and ^2.' (b) High Court (Commercial Division) Procedure Rules, 2012 (as amended, 2019), this Court makes further orders that, the decree emanating from this suit shall not be executed unless the decree holder has, within Page 11 of 12 a period of ten (10) days from the date of this default judgment, publish a copy of it (the decree) in at least two (2) widely circulated newspapers in the country and after a period of twenty one days (21), from the date of expiry of tbe said\; ten (10) days, has elapsed. x is so Ordered DATED at DAR-ES-SALAAM, ON THIS 28th DAY OF JUNE 2022 . DEO JOHN NANGELA JUDGE Page 12 of 12