CIVIL APPEAL NO

IN THE COURT OF APPEAL OF TANZANIA AT MWANZA fCORAM: NDIKA, J.A.. LEVIRA, J.A.. And KENTE, J.A.l CIVIL APPEAL NO. 484 OF 2020 ESTHER KIMBULU ............................................................. 1st APPELLANT SAMSON KIMBULU............................................................ 2 nd APPELLANT DAUD KIMBULU................................................................ 3rd APPELLANT VERSUS PIGANIO MWITA ............................................................. ... RESPONDENT (Appeal from the Decision of the High Court of Tanzania at Mwanza) (Makaramba. 3.1 dated the 30th day of September, 2016 in Land Appeal No. 90 of 2014 JUDGMENT OF THE COURT 29th April & 7th May, 2024 KENTE. J.A.: This is an appeal against the decision of the High Court (Makaramba, J), sitting at Mwanza, in exercise of its appellate jurisdiction in terms of which, the High Court reversed the decision of the District Land and Housing Tribunal for Mwanza (the DLHT) which was in favour of the appellants. The facts giving rise to this appeal, as can be gleaned from the lower courts' record, are briefly as follows: The appellants who are siblings and i heirs of the late Kimbulu Wang'olo, instituted a suit (Land Application No 13 of 2009) in the DLHT against the respondent accusing him of breach of a contract for sale of a house known and described as squatter No. 002/058 situated at Igoma, Mwanza which they had inherited from their late father. It was common ground between the parties that, on 9th June, 2008 the appellants sold the said house (hereinafter the suit house) to the respondent for TZS 18,000,000.00 and that, as per the sale agreement (Exhibit PI), the whole of the purchase price was to be paid by way of instalments within six months of the signing of the sale contract. The appellants alleged that, after paying the initial TZS 11,000,000.00, the respondent failed to honour the remaining part of his contractual obligations within the prescribed time; upon which, on 13th January 2009 the appellants sued him in the DLHT seeking the following substantive orders: One, a declaration that the sale agreement had been breached by the respondent; two, that the respondent be evicted from the suit house; and three, that the respondent should pay them mesne profits at the monthly rate of TZS 50,000.00 for utilizing the suit house from 10th September, 2008 to the date of giving vacant possession. In a way therefore, the appellants sought to back out of the sale agreement. 2 In reply, the respondent filed a defence stating that, as opposed to the appellants' claim, it was themselves who were in breach of the sale agreement after they failed to jointly turn up and collect the balance of the purchase price (TZS 7,000,000.00) which he was ready and willing to pay on the agreed date. Moreover, the respondent put in a counter-claim alleging that, following the appellants' failure to turn up and collect the balance of the purchase price on the agreed date, he was left in a legal limbo as he could not develop and put the suit house into use. He prayed for, inter alia, an order compelling the appellants to receive the balance of the purchase price together with a declaratory order to the effect that he was the lawful purchaser and owner of the suit house. He finally implored the DLHT to condemn the appellants to pay him general damages for their failure to perform their duty under the sale agreement. The DLHT delivered its judgment on the 5th September 2014 declaring that, indeed the sale agreement had been breached by the respondent. It also ordered the appellants to reimburse the respondent with TZS 11,000,000.00. At the same time, the DLHT ordered the respondent, after reimbursement, to give vacant possession of the suit house to the appellants. The respondent's counterclaim was dismissed in entirety. Aggrieved by the above decision, the respondent lodged an appeal in the High Court (Land Appeal No. 90 of 2014) which was determined on 30th September, 2016 in his favour. As would be expected, the appellants were deeply aggrieved by the decision and orders of the High Court, hence the present appeal. At the outset, Mr. Emmanuel John, learned advocate who appeared before us to represent the appellants, prayed to abandon the second, third and fifth grounds of appeal which respectively faulted the first appellate court for erring in interpreting the law on mesne profits, ordering the respondent to pay the outstanding amount without interest and failure to find that since payments by instalments were supposed to be effected through the bank, any other mode of payment was not in accordance with the terms of the contract. Thereafter, Mr. John successfully prayed to combine the first, fourth and sixth grounds of appeal which he then condensed down into one complaint thus: because of the respondent's breach of the sale agreement, the first appellate court erred in law by not holding that, the appellants were entitled under the law to repudiate the said contract. 4 Submitting in support of the appeal, Mr. John contended in the first place that, the appellants' complaint before the DLHT was specifically on the delay by the respondent to pay them the balance of the purchase price within the agreed period. In the second place, the learned advocate submitted that, in expression of their discontentment, the appellants had to issue the respondent with a demand notice which Mr. John equated with a notice issuable in terms of section 74 (1) of the Land Act, Chapter 113 of the Revised Laws. According to the learned counsel, since the respondent did not comply with what was stipulated in the demand notice, by the time the appellants decided to institute a suit against him in the DLHT, they were no longer bound by the terms of the sale agreement which in essence came to an end after expiry of the six months period. According to Mr. John, the import of the contractual term requiring the respondent to pay the entire of the purchase price within six months of the signing of the sale agreement was that, the parties would only be bound by the said agreement within that particular period. It is upon the above arguments that the learned counsel faulted the first appellate court for allegedly misdirecting itself by not taking into account the provisions of the Land Act specifically dealing with breach of contracts involving real property. 5 In opening the arguments for the respondent, Mr. Luhigo begun by contending that, it was rather wrong for Mr. John to say that, partial performance of a contract for sale of real property, leads to its being discharged or automatically gives the aggrieved party the right to repudiate it. The learned counsel further submitted that, in such a situation, the contract does not become voidable. Advancing his argument, he further submitted that, indeed the respondent in the present case did not perform his duties under the sale agreement to its fullness but that did not by itself give the appellants the right to rescind the said contract. According to Mr. Luhigo, the only remedy available to the appellants in the circumstance of this case, was the right to be compensated for the delay to be paid. To justify the foregoing, Mr. Luhigo further submitted that, as opposed to Mr. John who placed reliance on section 55(1) of the Law of Contract Act, the contract between the appellants and respondent was governed by section 55(2) of the said Act which stipulates that: "Where it was not the intention of the parties that time should be o f the essence of the contract, the contract does not become voidable by the failure to do such thing at or before the specified time; but the promisee is entitled to compensation from the promisor for any loss occasioned to him by such failure." Otherwise, Mr. Luhigo challenged Mr. John to demonstrate to the satisfaction of the Court that the intention of the parties to the sale agreement was that time was the essence to the contract. He referred to the Indian case of Gothinayagan Pillai & Others v Pallaniswami Nadar [1967] AIR 868 to support his tenor of argument. Referring to the impugned decision of the High Court, Mr. Luhigo explained that, there is nowhere in the sale agreement where it is specifically stated that time was of the essence. He argued that, this can be inferred from the fact that, the consequences of failure by the respondent to pay the purchase price within the prescribed period were not expressly spelt out in the contract. To this end, Mr. Luhigo urged us to hold, as did the first appellate court that, as time was not of the essence to the sale contract, the appellants were not entitled to rescind the said contract for allegedly being voidable. Responding to the concern raised by Mr. John that section 55 (2) of the Law of Contract Act on which the respondent placed more reliance, appears to be in conflict with section 73 of the Land Act which empowers 7 a vendor of a right of occupancy to rescind the contract and obtain a court's order for regaining possession by reason of breach by the purchaser, Mr. Luhigo submitted, correctly so in our view that, the right to rescind a contract for sale of real property under section 73 of the Land Act arises only where, in terms of section 55 (1) of the Land Act, time is of the essence to that contract. With regard to the submission made by Mr. John that the demand notice (Exhibit P2) issued by the appellants to the respondent threatening him with legal action if he did not abide by what was stipulated therein, was akin to a demand notice issuable in terms of section 74 (1) of the Land Act, the position taken by Mr. Luhigo was quite different. He argued that, what was allegedly issued to the respondent was not a demand notice but rather a letter of demand formally requiring the respondent to pay the remaining balance or else risk being subjected to legal action. But what is more, Mr Luhigo contended, the said notice was not served on the respondent for which, he implored us to ignore it. Regarding the complaint by the appellants that the first appellate court strayed into error when it ordered the respondent to pay them the remaining balance of the purchase price without interest, the gravamen 8 of Mr. Luhigo's argument (as in the courts below) was that, the appellants, quite aware of the likelihood of an order for payment of the remaining balance being made against the respondent, did not plead interest on the decretal amount. The learned counsel submitted therefore that, in such circumstances and as such, in civil litigation parties are bound by their own pleadings, the appellants cannot be heard today to complain that for no apparent reason, the first appellate court did not award interest on the decretal sum. It would appear to us that although not expressly stated, Mr. Luhigo had in mind what we held in the case of James Funke Gwagilo v. The Attorney General [2004] T.L.R 161 and Hotel Travertine Limited & Others v. National Bank of Commerce [2006] T.L.R 133 where we stated that, it is elementary law which is settled that in our jurisdiction, the court will grant only a relief which has been prayed for. We have considered the appeal together with the judgment and decree of the High Court appealed against. We also have in mind all the submissions made by the respective counsel, each in support of his client's case. Essentially, the issue for our determination as aptly captured in the consolidated grounds of appeal turns on the construction to be placed on clause 4 of the sale agreement whose unofficial translation into English runs as follows: 4. That, the balance o f TZS11,000,000.00 shall be paid by instalments within six months o f the signing o f this contract. That in essence, is the Clause in the sale contract which is critical to deciding this appeal. Our ultimate obligation is to determine, as did the first appellate court, whether or not time was of the essence to the contract for sale of the suit house as to justify the appellants' move to rescind it. In his decision, the learned first appellate Judge was clearly impressed by the argument by Mr. Luhigo regarding the intention of the parties to the sale contract. He accordingly stated in his judgment, at page 211 of the record of appeal that: "As it would appear in the contract the subject o f this matter, the effect o f failure to act within the ambit o f Clause 4 is stipulated under Clause 8 of the Sale Agreement, Exhibit PI, which allowed the parties to the contract to resolve any differences arising by way o f mediation or to refer the matter to court for legal steps." 10 The learned Judge then went on concluding that: "Thus, in terms o f Clauses 4 and 8 o f the Sale Agreement, the parties really did not intend the contract to be terminated over a missed deadline" Regarding the fundamental question as to whether or not time was of the essence to the sale contract, the learned Judge of the first appellate court took the view that, the terms in Clause 4 were not drafted in a mandatory manner that the respondent must perform the contract within six months. To this end, he endorsed Mr. Luhigo's argument that the sale agreement did not indicate the consequences in case the respondent failed to act within the prescribed six months period. On our part, we are bound to agree with the finding by the first appellate court. In doing so, we start from the premise that, the consensus in this case appears to be that indeed, the respondent was in breach of the sale agreement after he failed to pay the entire of the purchase price within the agreed period. Upon the above consensus, the question that arises as it was before the lower courts, is whether or not the appellants had the right to invoke the provisions of section 73 of the Land Act and resume possession of the suit house as contended by Mr. John. li In the light of the view that we have regarding a "time is of the essence" clause in real estate contracts, we feel compelled to resolve the above-posed question in the negative. In this connection, we are alive and we entirely subscribe to the holding by the Supreme Court of India in the earlier-cited case of Gomathinayagan Pillai (supra) to which we were referred by Mr. Luhigo, that: "Fixation o f the period within which the contract is to be performed, does not make the stipulation as to time o f the essence of the contract" Coming back home, while following our earlier decision in the case of Mirambo Mabura v. Yohana Maiko Sengasu and Another, Civil Appeal No. 71 of 2020 (unreported) in which we cited with approval the comments in Halsbury's Laws of England, 5th Ed Reissue, Vol. 9 (1) at page 685, we took the position in the case of Melchiandes John Mwenda v. Ramadhani Mussa and Another Civil Appeal No. 387 of 2020 (unreported) that, under the modern law in the case of contracts of all nature: "The time wiii not be considered to be o f essence, except in one of the following cases: 1) where the parties expressly stipulated that conditions as to time must be strictly complied with; 2) the nature 12 o f the subject matter o f the contract or the surrounding circumstances show that time should be considered to be essence; 3) a party who has been subjected to unreasonable delay gives notice to the party In default making time of essence". In the instant case, our view is that the issue as to whether or not time was of the essence to the sale contract was amply and ably dealt with by the learned High Court Judge who finally came to the correct conclusion that it was not the intention of the parties that the contract would be terminated over a missed deadline. It must therefore be observed that, save for the existence of any of the above mentioned three conditions which is not the case here, a mere designation of a closing date in a contract of sale of real property as it happened in this case, does not necessarily make that date of essence if the contract does not contain an express declaration to that effect. To the above extent therefore, we agree with the learned Judge on the first appeal and, following the same roadmap leading to his impugned decision, we find the appeal on that aspect to have no merit and we accordingly dismiss it. 13 However, we posit that, given the facts and circumstances obtaining in this case, our determination of this appeal would be inconclusive if our judgment just ended here. For purposes of completeness, it behoves us to state that, after holding that the appellants were entitled to compensation for the respondent's failure to perform the contract within ( the specified period, the learned Judge of the first appellate court still remained with some unfinished business with the parties before him. Once it was proved that the respondent was guilty of breach of the contract and, in view of the reknown principle, that where there is a wrong, there is a remedy (ubi jus ibi remedium), it was then not enough for the learned Judge to just declare that the appellants were entitled to compensation from the respondent without following through to assess and award the said compensation or damages, being the most common remedy for breach of contract. It is for the above reason that it becomes incumbent upon us to step into the shoes of the first appellate court as we hereby do, and award compensation to the appellants which we assess at the tune of TZS 10,000,000.00 because of the respondent's failure to perform his contractual obligations to their finality. It is needless to say that, the 14 appellants are as well entitled to payment of TZS 7,000,000.00 which is I the balance of the purchase price as decreed by the lower courts. In view of the balanced proportion of our decision, we order for each party to this appeal to bear its own costs. DATED at MWANZA this 6th day of May, 2024. I G. A. M. NDIKA JUSTICE OF APPEAL M. C. LEVIRA JUSTICE OF APPEAL P. M. KENTE JUSTICE OF APPEAL The Judgment delivered this 7th day of May, 2024 in the presence of Mr. Andrew Luhigo, learned counsel for the respondent and also holding brief of Mr. Emmanuel John, learned counsel for the Appellants is hereby certified as a true copy of the original.