exim bank t ltd vs walter buxton chipeta 2011 tzhccomd 2047 28 march 2011

IN THE HIGH COURT OF TANZANIA (COMMERCIAL DIVISION) AT DAR ES SALAAM COMMERCIAL APPEAL NO.4 OF 2009 (Appeal from the Judgment and Decree of the District Court of Ilala (Hon. S.L. Maweda Esq. RM) at Samora in Civil case No. 127 of 2007 dated 13th February 2009) EXIM BANK (T) LIMITED................................................................ APPELLANT VERSUS WALTER BUXTON CHIPETA......................................................... RESPONDENT Date of last order. 25/11/2010 Date of final submissions'. 20/01/2011 Date ofjudgment 28/03/2011 JUDGMENT MAKARAMBA, J.: . This is a judgment on appeal originating from the exparte judgment and decree of the District Court of Ilala (Hon. S.L. Maweda Esq. RM) at Samora in Civil Case No. 127 of 2007 dated 13th February 2009. The Appellant being dissatisfied with that decision has appealed to this Court on the following grounds, namely, that: 1. The learned trial magistrate erred and or otherwise misdirected himself striking out an application for extension of time to file written statement of defence. 2. The learned trial magistrate erred in holding that the Respondent had sufficiently proved that the Appellant had negligently and unlawfully appropriated a sum of $3000 from the Respondent's United States Dollars Account only. i 3. The learned trial magistrate erred in holding that the Appellant negligently and unlawfully appropriated the sum of USD 7,549,190 from the Respondent's account in breach of an agreement which agreement was not tendered before the trial court 4. The learned trial magistrate stayed into error of law and fact in holding that the Respondent lost an investment offer of United States Dollars 4,000 to Kazzar Ltd on 24h May, 2007. 5. The learned trial magistrate erred in law and fact in holding as he did that the Respondent suffered loss of profit in the sum of USD 14,541 without any credible evidence to support that finding. 6. The learned trial magistrate erred in law and fact in awarding interest at the rate of 24% per annum to a Dollar account without any evidence to support the award 7. The learned trial magistrate erred in law in awarding interest on the decretal sum at the rate of 12% contrary to the law 8. The learned trial magistrate erred in law in not holding that the Respondent's case had not been sufficiently proved and hence dismissing it. The Appellant prayed for an order of this Court setting aside the judgment and decree of the lower court and substitute it with an order dismissing the suit with costs. The Appeal by consent of Counsel for the parties was disposed of by way of written submissions. The firm of lawyers of REX ATTORNEYS Advocates represented the Appellant. M/s Anette Kirethi, learned Counsel, advocated for the Respondent. The background to the appeal briefly is that the Respondent was the Plaintiff in Civil Case No. 127 of 2007 at the Ilala District Court. He filed the suit against the Appellant Bank for negligence and fraud by unlawful 2 appropriation of funds amounting to US$10,549.10 from his bank account No.52039780 held with the Appellant Bank. The Respondent further sought specific damages for lost business opportunity and interest and costs thereon. It would appear that the Appellant was served with copies of the plaint and summons to file written statement of defense in the lower court but failed to do so, whereby on 1st August 2008, the lower court dismissed an application by the Appellant to file its written statement of defence out of time for being time barred and ordered that the matter proceed by way of exparte hearing. On 13th February 2009, the lower court delivered its exparte judgment in favour of the Respondent. The Appellant was aggrieved with the judgment and filed this appeal, praying that the exparte judgment be set aside and substitute it with an order dismissing the suit with costs. The Respondent's Counsel in his reply submission raised a preliminary point of objection relating to the propriety of the appeal basing on Item I of Part II of the Schedule to the Law of Limitation Act [Cap.89 R.E. 2002], which is to the effect that the limitation period for an appeal from the decision of the District Court to the High Court where the period of limitation is not otherwise provided for by any written law to be ninety (90) days appeal. It was argument of the Respondent's Counsel that considering that the time within which appeals from lower courts to the High Court begins to run immediately upon delivery of the judgment and or ruling against which the appeal is preferred, which in the present case was 13th February 2009, this appeal ought to have been filed on 14th May 2009 3 which is 90 days from the date of judgement. The Respondent's Counsel argued further that given that there is no provision for automatic exclusion of time spent in procuring the necessary judgment, decree, order and/or other documents in the procedure for appeals for subordinate courts, the remedy available in case of delay is to for a party seeking to appeal to make an application for extension of time to file such an appeal for which the delay in obtaining necessary documents for appeal purposes would constitute a good cause for extension of time. The present appeal which was filed on 6th November 2009, more than five months from the date the judgment exparte against which the appeal is sought was handed down, and without extension of time to file it out of time, it has been filed out of time and it ought to be dismissed with costs for being time barred, the Respondent's Counsel prayed. In buttressing his point, the Respondent's Counsel cited to this Court the case of TANZANIA PORTS AUTHORITY V. PEMBE FLOUR MILLS Civil Application No.49 of 2009 (CAT) (unreported) (a copy which was availed to this Court) where an applicant excessively delayed in bringing an application and failed to advance any reasonable cause or excuse for the delay and the Court dismissed the application for extension of time to file an amended decree. The Appellant's Counsel in rejoinder submitted that contrary to the argument by the Respondent's Counsel that the appeal is time barred; the Appellant's Counsel was of the firm view that the appeal is not time barred by reason of the provisions of section 19(2) of the Law of Limitation Act [Cap.89 R.E. 2002] which stipulates as follows: 4 "19(2) In computing the period of limitation prescribed for an appeal, an application for leave to appeal, or an application for review of judgment, the day on which the judgment complained of was delivered, and the period of time requisite for obtaining a copy of the decree or order appealed from or sought to be reviewed, shall be excluded." (the emphasis is of this Court). The Appellant's Counsel submitted further that as the record will bail them out, by a letter, the original copy of which is found in the original record, they applied to the lower court to be supplied with copies of judgment, decree and proceedings for the purpose of appeal for copy, which they received on 14th September 2009 as evidenced by a copy of the Exchequer Receipt on record, and that they lodged the appeal on 6th November 2009, which was within 90 days, excluding the time requisite for obtaining the said copies as required under the law. The Appellant's Counsel prayed that this Court overrule the objection raised by Respondent's Counsel for being misconceived and proceed to determine the appeal. The gist of the preliminary point of objection raised by the Respondent's Counsel is that the present appeal is time barred for having been preferred hopelessly out of time and without leave of the court. The Appellant's Counsel on the other hand contends that the appeal has been preferred in time as it has been brought within 90 days excluding the time spent to obtain copies of proceedings, judgment and decree of the District Court. 5 The provisions of the law on appeals from the lower courts when exercising original jurisdiction to the High Court make it mandatory for a party seeking to appeal to attach to the memorandum of appeal copy of the decree appealed from and unless the Court dispenses therewith, of the judgment on which it is founded. This comes out very clearly under Order XXXIX Rule 1(1) of the Civil Procedure Code thus: (1) Every appeal shall be preferred in the form of a memorandum signed by the appellant or his advocate and presented to the High Court (hereinafter in this Order referred to as "the Court") or to such officer as it appoints in this behalf and the memorandum shall be accompanied by a copy of the decree appealed from and (unless the Court dispenses therewith) of the judgment on which it is founded." (the emphasis is of this Court). In terms of the provisions of the law cited above, a copy of the decree appealed from and of the judgment, on which it is founded if the court has not dispensed with, is a requisite in an appeal to the High Court from a decision of the lower court exercising their original jurisdiction. Furthermore, the law entitles to a party seeking to appeal to the benefit of exclusion of the time spent in obtaining such copies from the time prescribed for appeal. The law, as correctly submitted by Respondent's Counsel and acceded to by the Appellant's Counsel, does not prescribe the time limit for preferring an appeal to the High Court from a decision of the lower courts exercising their original jurisdiction. In such situation resort is therefore to be had to Item I of Part II of the Schedule to the Law of Limitation Act [Cap.89 R.E. 2002], which provides for a period of 6 limitation where it is not otherwise provided for by any written law to be ninety (90) days. The main argument by the Respondent's Counsel is that the appeal having been brought five months after the judgment against which appeal is sought was handed down and without extension of time it is hopelessly out of time and should be dismissed. The Appellant's Counsel countered this argument by submitting that the appeal is within the 90 days time considering the time they spent applying for copies of the said documents which they finally managed to obtain on the 14th September 2009 and filed the appeal on 6th November 2009. I have gone through the record. There is a letter dated 13th February 2009 by Rex Attorneys addressed to the Resident Magistrate-in-charge Ilala District Court, which the Court acknowledged on 16/02/2009, requesting to be supplied with duly certified copies of the proceedings, judgment and decree for purposes of instituting appeal to the High Court. The said letter is accompanied with a photocopy of Exchequer Receipt No.35246425 dated 14/09/2009 evidencing receipt for the payment of Tshs.1500/- from Rex Attorneys towards copies of the exparte judgment in Civil Case No. 127/09. In the circumstances I am at one with the Appellant's Counsel that given that they received copies of the proceedings, judgment and decree as evidenced by the Exchequer Receipt on 14/09/2009, by filing the appeal on 6th November 2009 it was therefore within time. The law on exclusion of time for purposes of computing the period of limitation 7 prescribed for an appeal, among others, states very clearly under section 19(2) of the Law of Limitation Act, thus: "19(2) In computing the period of limitation prescribed for an appeal, an application for leave to appeal, or an application for review of judgment, the day on which the judgment complained of was delivered, and the period of time requisite for obtaining a copy of the decree or order appealed from or sought to be reviewed, shall be excluded." (the emphasis is of this Court). In the instance case therefore the prescribed time of 90 days is to be reckoned by excluding the day on which the judgment complained of was delivered, which in our case was 13/02/2009, and the period of time requisite for obtaining a copy of the decree or order appealed from or sought to be reviewed, which is from 13th February 2009 when they applied for the said documents to the 14/09/2009 when they received the same as evidenced by the Exchequer Receipt on record. In the event and for the foregoing reasons, the preliminary point of objection raised by the Respondent's Counsel that the appeal is time barred is hereby overruled. I shall therefore accordingly proceed to determine the grounds of appeal. In the course of making his submissions, the Appellant's Counsel elected to abandon ground number one of appeal that the learned trial magistrate erred and or otherwise misdirected himself striking out an application for extension of time to file written statement of defence. The Appellant's Counsel having prayed to abandon the first ground of appeal begun his submissions starting with ground number eight 8 then he submitted on ground number 2 and 3 together. It is rather unfortunate that the Respondent's Counsel nevertheless proceeded to make reply submissions on the first ground of appeal despite having been abandoned by the Appellant's Counsel. The eighth ground of appeal is that the learned trial magistrate erred in law in not holding that the Respondent's case had not been sufficiently proved and hence dismissing it It is the submission of the Appellant's Counsel that on point of law, the judgment of the lower court ought to be vitiated because it does not comply with the mandatory provisions of Order XX Rule 4 of the Civil Procedure Code. The Appellant's Counsel submitted further that the judgment does not contain concise statement of the case, the points for determination, the decision and reasons thereof, and that essentially the learned trial magistrate spent a considerable amount of time and space reproducing the evidence rather than analysing it. The Appellant's Counsel citing Muiia on the Code of Civil Procedure Code on pari materia provision to the effect that "an exparte judgment which does not set out all the points arising for determination and does not discuss the evidence is no judgment and is for that reason vitiated’, argued further that the judgment was arrived at without the trial court scrutinizing the evidence before it with care as a result of which it made incongruent and erroneous findings. The Appellant's Counsel prayed that for those reasons the judgment is thereby vitiated citing the decision of STAN LAUS RUGABA KASUSURA V. ATTORNEY GENERAL & PAHARES KABUYE [1982] T.L.R. 338 9 cited in Chipeta's book Civil Procedure In Tanzania: Student's Manual where the Court of Appeal held a decision of the High Court as being fatally defective for leaving contested issues unresolved. It was the further contention of the Appellants Counsel that the holding of the learned trial magistrate at page 10 of the judgment that the Appellant negligently and unlawfully appropriated the sum of USD 3000 and USD 7,549.10 was made without any analysis of the evidence as required by Order XX Rule 4 of Civil Procedure Code. It was the further submission of the Appellant's Counsel that aside from the mere statement by the learned trial magistrate that he thoroughly examined the evidence and exhibit nothing is said as to whether he determined the point whether the Appellant had negligently and unlawfully appropriated the sum of USD 3000 and USD 7,549.10 from the Respondent's account and what particular piece of evidence supported the Respondent's case and why the trial court believed them and hence the decision and reasons thereon. The Appellant's Counsel submitted further that the same applies with regard to the points of determination with respect to the projected profits from investment. The Appellant's Counsel submitted on the 2nd and 3rd grounds of appeal jointly. The second ground of appeal is that the learned trial magistrate erred in holding that the Respondent had sufficiently proved that the Appellant had negligently and unlawfully appropriated a sum of $3000 from the Respondent's United States Dollars Account only. The third ground of appeal is that the learned io trial magistrate erred in holding that the Appellant negligently and unlawfully appropriated the sum of USD 7,549,190 from the Respondent's account in breach of an agreement which agreement was not tendered before the trial court. The Appellant's Counsel submitting on the 2nd and 3rd grounds of appeal seriatim stated that had the trial magistrate directed his mind properly to the facts before him he would not have failed to find contrary to his findings that there was no misappropriation of USD 3,000 or USD 7,549.10 from the Respondent's account and if so having admitted that the same amount was subsequently remitted to his MASTER ACCOUNT, the Respondent incurred no loss by the delay in remitting those sums. In other words, the Appellant's Counsel further submitted, the delay in remitting the amount to the Respondent' Master Card account did not constitute misappropriation of that sum to the benefit of the Appellant and to the Respondent's prejudice. It was the further submission of the Appellant's Counsel that condemning the Appellant to interest at the rate of 24% per annum was a manifest error on the part of the trial court because if there was any misappropriation of the said amount, the Respondent could only have been entitled to interest at the rate duly proved and accepted by the court and the record does not show if the Respondent led any evidence to prove interest of 24% per annum from a Dollar account to form basis of the trial court award. li The Respondent's Counsel flagged off his reply submissions by stating the norm in banking operations with regard to the operation of two accounts as was laid down in NKOLOMA V. NBC HOLDINGS CORPORATION [2000] 1 E.A 187. In that case the Court of Appeal of Tanzania considered whether the Bank was justified in combining accounts by transferring funds from a credit to loan account. In that case, the Court of Appeal stated as follows: ",.. Where there is agreement to keep more than one account separate, then there is no need to give notice before exercising the right to combine accounts, although reasonable notice is required but even in such situation if the words of the agreement indicate that the agreement would cease upon the occurring of an event, notice is equally not required." (the emphasis is of this Court). It was the further submission of the Respondent's Counsel that the terms of the parties' agreement with regard to the operation of his ordinary account and the credit card account, were established through the testimony of PW1 and Exhibit Pl, a letter by the Appellant dated 6th December 2006 approving the Respondent's application made on 16th November 2006 for credit card account, containing the terms of operating both the Respondent's credit card account and savings account. The Respondent's Counsel submitted further that at the trial court the testimony of PW1 and Exhibit P2 collectively established the agreed mode of payment for the credit card account. The Respondent's Counsel submitted further that the Respondent proved the agreement of the parties by production of monthly bank statements on his credit card account with 12 the Appellant and instruction letters that he wrote to the Bank authorising payment of accrued credit card bills {Exhibit P3 and P8 collectively). It is noteworthy that the payments made on the credit card account corresponded with the amounts that the Respondent authorised the bank to pay and that these payments were all done after each respective instructions were sent by the Respondent and received by the Appellant, the Respondent's Counsel pointed out. On the issue of unlawful and unauthorised withdrawals complained of, the Respondent's Counsel submitted that the Respondent advanced sufficient evidence to warrant a finding in his favour as evidenced by Exhibit P6 collectively. The Respondent stated the established principle for debiting the Respondent's savings account upon receipt of written instructions from the Respondent as stated by the Court of Appeal of Tanzania in the NKOLOMA V NBC HOLDINGS CORPORATION [2000] 1 EA 187 that: "...it is our considered opinion that where there is no agreement to keep more than one account separate, then there is no need to give notice before exercising the right to combine accounts. However, where there is such agreement then reasonable notice is required. But even in such situation if the words of the agreement indicate that the agreement would cases upon the occurring of an event, notice is equally not required." (the emphasis of the Respondent). The Respondent submitted that at the trial PW1 established the terms of the parties' agreement with regard to operation of his account and credit card account. That the respondent's application for credit card 13 was done on 16/11/2006 and approved by Appellant by its letter on 6/12/2006, Exhibit Pl collectively containing the terms of the operations of both his credit card account and his savings. The Respondent stated further that PW1 established before the lower court on the parties' agreed mode of payment for the credit card account as per pWl's testimony and Exhibit P2 collectively. Respondent proved the parties agreement by production of monthly statements on his credit card account with the Appellant and instruction letters that he wrote to the bank authorising payment of accrued credit card bills, Exhibit P3 and P8 collectively, noteworthy, the payments made on the credit card account corresponded with the amounts that the Respondent authorised the bank to pay and that these payments were all done after each respective instructions were sent by the Respondent and received by the Appellant. On unlawful and unauthorised withdrawals complained of the Respondent submitted that as per Exhibit P6, the Respondent advanced sufficient evidence to warrant a finding in his favour on this point. Respondent received his credit card statement of 15/04/2007 for Tshs.7,712,227.38. Respondent consequently issued instructions to the appellant bank to pay $3000.00 from his savings account into the credit card account as was the norm. On 24/05/2007 attended the Appellant bank and was turned away upon attempting to withdraw US$ 4,000.00 for lack of sufficient funds in his savings account and upon enquiries he was supplied with statements in respect of his savings account showing a balance of US$2,759.39. It was the further testimony of the Respondent 14 that the statement in respect of the Respondent's savings account evidenced suspicious and unauthorised transactions, namely on 04/05/2007, US$ 3,000 was withdrawn pursuant to the Respondent's instructions of 03/05/2007; and that on 17/05/2007, US$ 7,549.10 was withdrawn from the Respondent's savings account with no corresponding instructions authorising such debit from the Respondent as required or at all. The Respondent's Counsel submitted further at the lower court the Respondent (PW1) testified that the Respondent was served with his credit card statement of accounts dated 15/06/2007, 15/07/2007 and 15/08/2007 as per Exhibits P6 and P7 and upon their perusal he discovered the following irregularities: that Tshs.9,572,261.52 was paid into the credit card account on 16/05/2007, which amount corresponded to the amount of US$7,549.10 save that the latter was debited from the Respondent's savings account on 17/05/2007, which is one day after the same funds were paid into the credit card account. Further, that Tshs.3,786,000.00 was paid into the credit card account on 08/06/2007, which amount corresponded with the Respondent's instructions of 03/05/2007 to pay US$,3,000.00. The Respondent stated further that however, despite the debit from the savings account on 04/05/2007, the said funds were deposited into the credit card account over one month later without any explanation thereto. The Respondent testified further on the credit balance reflected in the credit account of 15/06/2007 as Tshs.2,993,255.97; that of 15/07/2007 as Tshs.2,793.95 and that of 15/08/2007 as 15 Tshs. 1,051,800.03, all of which the Respondent submitted that were irregular as the Respondent operated a credit card and not a debit card therefore it ought not have had a credit balance at all. It was the further testimony of the Respondent that he took immediate steps to bring attention of the anomalies to the Appellant bank through his letters of 06/06/2007 and 03/07/2007 as per Exhibit P4 collectively, which the Appellant ignored and elected to stay mum throughout the entire period leading up to the filing of the suit and even failed to file written statement of defence as required which meant that the lower Court was not availed with the Bank's position in that regard. It was the further submission of the Respondent that the said omission was occasioned by the Bank's own inadvertence and/or negligence which is inexcusable and that in those circumstances the power court cannot be faulted for its decision on the matter. The Respondent wound up his submissions on this point by submitting that in line with Nkoioma's case (supra), there being an established practice for debiting the Respondent's savings account upon receipt of written instructions from the Respondent, the bank ought to have notified the Respondent in event of any changes in their banking procedures and/or regulations necessitating direct debit at their own instance which they failed to do, which amounted to breach of the bank's mandatory duty of care towards the Respondent's accounts at their bank which resulted in injury to the Respondent for toss of an investment opportunity with Messrs Kazzar Limited. I shall revert to 16 the issue of loss of investment opportunity by the Respondent to Messrs Kazzar Limited when considering the 4th, 5th and 6th grounds of appeal. I have examined the record in this appeal. It is true and as conceded to by the Respondent that a trial court has to comply with Order XX Rule 4 of the Civil Procedure Code [Cap.33 R.E. 2002] on the need for the lower court to analyse the evidence. However, with due respect to the Appellant's Counsel and having gone through the record of the lower court and the submissions of the Respondent, this Court is satisfied that the lower court did analyse the evidence before arriving at its decision that the two sums of $3,000.00 and $7,549.10 were negligently and unlawfully appropriated from the Respondent's account by the Appellant Bank. This Court is satisfied on the basis of the evidence on record that the lower court did consider the relevant issues and analyse the evidence on record and correctly arrived at its findings on the balance of probabilities. In any event, I am at one with the Respondent's submission that there is no exact format of how a judgment should look or be phrased which is not the intendment of Order XX Rule 4 of the Civil Procedure Code. On the evidence on record and from the submissions by the Respondent's Counsel, this Court is satisfied that the Respondent did sufficiently prove that the Appellant had negligently and unlawfully appropriated a sum of USD 3000.00 from the Respondent's United States Dollars Account and that the Appellant negligently and unlawfully appropriated the sum of USD 7,549.10 from the Respondent's account. The 2nd and 3rd grounds of appeal fail and are hereby dismissed. 17 I shall now turn to consider the 4th, 5th, 6th, 7th and 8th grounds of appeal seriatim. On the 4th ground of appeal that the learned trial magistrate stayed into error of law and fact in holding that the Respondent lost an investment offer of United States Dollars 4,000 to Kazzar Ltd on 24? May, 2007, the Appellant's Counsel submitted that if it is correct that on 23rd May 2007, PW1, who was also a director of a company alleged to have lost investment offer was unable to access US$ 4,000 from his account with the Appellant and thereafter requested to be supplied with a bank statement, it is not clear why he had to wait until 06th June 2007 to ask for explanation from the Appellant more so when he was facing a deadline at 1600 hrs on the same day. It was the Appellant's Counsel case further submission that it is not clear from the record at what time did PW1 go to draw $4000 relative to the time he was to pay that amount to Kazzar Ltd. at 1600 hours same day, taking into account that the alleged offer was made on 21st May, 2007 and accepted on 23rd May 2007. The Appellant's Counsel submitted further that it was highly probable that despite the fact that on the material date the Respondent's account reflected a balance of US$ 2,759.39, it is not clear and no evidence was led at the trial to suggest that despite that credit balance, the Respondent was prevented from withdrawing a lesser sum than $4000. Further, there is no evidence on record suggesting that after the Respondent failed to withdraw that amount from his account he made any efforts to look for 18 alternative sources of funding to meet the deadline for the offer, the Appellants Counsel further submitted. The Appellant's Counsel also took issue with the admission of documentary evidence which a party relies on which must be originals unless exempted under section 67(1) of the Tanzania Evidence Act [Cap.6 R.E. 2002]. The Appellant's Counsel submitted further that the letter of offer written by the Respondent dated 21st May 2007 and sent to Kazarr on 23rd May 2007 was produced by the Respondent despite no longer remaining in their possession once having been sent to Kazarr, and there is no evidence on record to suggest that the letter was original, and if not whether leave was sought and obtained for admission of a copy in lieu of the original. The said letter was wrongly admitted in evidence with the effect that there was no acceptance to the said investment offer which could have been cancelled by a letter from Kazarr Limited on 25th May 2007, the Appellant's Counsel further submitted. Surmising, the Appellant's Counsel submitted that having regard to the totality of the evidence which was conspicuously wanting in material respect, it was wrong for the trial magistrate to find that the Respondent lost any investment offer in Kazarr Limited and condemning the Appellant as he did. In his submissions, the Appellant's Counsel invited this Court to re­ evaluate the evidence and make its own findings to the effect that the Respondent lost investment offer in Kazarr Limited. The Appellant's Counsel cited the cases in MARTHA WEJJA VS. ATTORNEY GENERAL & ANOTHER [1982] T.L.R. 35; PETERS VS. SUNDAY POST [1958] 19 EA 424; and WYNS JONES MBWAMBO VS WANDOS PETER AARONI [1966] 242 as authorities establishing the principle that a first appellate court has power and authority to look at and evaluate evidence afresh of the trial court and make its own conclusions where the trial court adopts wrong approach in evaluating evidence or omits to evaluate some of the witness or top consider some vital piece of evidence. In the fifth ground of appeal, the Appellant challenges the trial court for its errors of law and fact in holding that the Respondent suffered loss of profit in the sum of USD 14,541 without any credible evidence to support that finding. It was the submission of the Appellants Counsel that the suit was essentially on account of breach of banker customer relationship, which if proved would have entitled the Respondent to an award of general damages. Contrary to the trial court, the claim for loss of investment was not specifically pleaded, but even so, it was not strictly proved. The Appellant's Counsel submitted further that in somewhat unusual way, the trial court rejected the prayer for general damages which would have resulted from proof of breach of contract, but it awarded a prayer for specific damages on account of loss of profits, which were neither specifically pleaded nor strictly proved. It was the further submission of Appellant's Counsel that even assuming that the general damages would be measured in relation to the loss of profit from the lost investment offer in Kazarr Limited, still, the court could not have awarded such damages because they did not fall within the ambit of s.73 of the Law of Contract Act and the rule in HADLEY VS. 20 BAXENDALE'S case. It was the further submission of the Appellants Counsel that the trial court awarded damages in contravention of section 73(1), (2) and (4) of the Law of Contract Act in that: (i) There was no proof that the damages alleged to have been sustained arose in the usual course of things from such a breach, or within the knowledge of the Appellant when entering into the banker customer relationship. (ii) The compensation was given for remote and indirect loss from the alleged breach. (Hi) There was no evidence before the trial court if the Respondent attempted any means of remedying the inconvenience caused by the alleged breach of the contract. Despite pleading loss of investment at para 9.4 of the plaint, there was no proof whatsoever to establish that the Respondent did anything to mitigate the alleged loss. The Appellants Counsel submitted further that the learned trial magistrate applied a wrong approach in arriving at quantum of loss of profit thereby causing injustice to the Appellant. It was the further submission of Appellants Counsel that the trial court did not ask itself the question, if the investment was to realize an interest of 24% per annum on $4000, how much the company would realize by way of profits from the business. It was the further submission of the Appellant's Counsel that had the trial court asked itself this question, it should have found that PW1 did not prove the investment and loss of profits from the business. Furthermore, the Appellant's Counsel submitted, the trial court did not ask itself another important question regarding loss of profits, that 21 is, did not take into account such aspects as taxes payable by the Respondent before arriving at the figure, which does not appear from the record and which the Appellant could not be condemned to compensate the Respondent, and invited this Court to uphold this ground and in the unlikely event of not doing so, accordingly to reverse the trial court's award by deducting from it such amount that the Respondent was legally obliged towards taxes. In the sixth ground of appeal, the Appellant is challenging the trial court's judgment for awarding interest at the rate of 24% per annum to a Dollar account in the absence of any evidence in support of it. It was the submission of the Appellant's Counsel that there was no evidence before the trial court to prove that 24% per annum was a commercial rate which the court could accept or take judicial notice of in terms of section 58 and 59 of the Evidence Act. Further, alternatively, there is nothing on the record to establish that an award of the rate of 24% per annum was a matter which was admitted before the trial pursuant to section 60 of the Evidence Act. Lastly, in ground seven of appeal, the Appellant seeks to impugn the trial court's decision to the extent that it relates to an award of interest on the judgment debt at the rate higher than what the law provides. It was the case for the Appellant that even assuming that the trial court was correct in awarding to the Respondent the decretal amount as it did, it was, nonetheless wrong in awarding interest on the decretal sum at the rate of 12% per annum contrary to the law. It was the 22 further argument of the Appellant's Counsel that in terms of section 29 read together with Order XX Rule 22(1) of the Civil Procedure Code, a rate of interest beyond 7% per annum can only be awarded subject to an express agreement or by consent before or after delivery of judgment which in the present case it is absent. Accordingly the award is illegal and ought to be set aside and in the unlikely event the court were to uphold the trial court's decision the rate of interest on the decretal amount ought to be reduced to 7% per annum in conformity to the law. Responding the Respondent submitting on the argument by the Appellant's Counsel that the Respondent had failed to prove the existence and validity of the alleged offer for investment from Kazzar Limited, started by revisiting Black's Law Dictionary on the meaning of the term "offer11, "acceptance!' and the provisions of sections 2(l)(a) and (b) of the Law of Contract Act [Cap.345 R.E. 2002] on the elements of a valid contract namely, consideration, lawful object and be made by free consent of the parties in addition to other requirements. It was the testimony of the Respondent (PW1) that on 21/05/2007, the Respondent received an offer from Messrs Kazzar Limited as per Exhibit P5 collectively for investment of $4,000.00 into the company for one year which letter of offer was accompanied with an investment earning schedule at the rate of 24% p.a. compound interest and the offer was to lapse on 24/05/2007 at 16.00 hours and that the Respondent by a letter accepted the offer on 23/05/2007. The Respondent submitted that on attending the appellant 23 bank on 24/05/2007 with a view of drawing the requisite $4,000.00 from his savings account and filled the withdrawal slip (Exhibit P6) was told that his account did not have sufficient funds as a result of which he failed to fulfil the requirements for the investment offer with Kazzar Limited, consequently on 25/05/2007 Kazzar Limited wrote to the Respondent cancelling its offer for investment. The Respondent stated that the facts on the existence of the offer, acceptance by the Respondent and subsequent cancelation of the offer by Kazarr Limited were also corroborated by Mr. SIMBO MUSHI (PW2) the Managing Director of Kazzar Limited. The issue for determination by this Court is whether on the evidence on record a valid investment agreement between the Respondent and Kazzar Limited has been established on a balance of probabilities. The main argument by the Respondent's Counsel is that the sum of US$3,000.00 having been withdrawn from the Respondent's savings account on 04/05/2007, it was deposited into the credit card account over one month later. The Respondent's Counsel contends further that the Appellant utilised these funds for an unknown purpose for their own benefit and to the detriment of the Respondent on additional interest and other charges for delayed settlement of the Respondent's credit and bill. It was the further contention of the Respondent's Counsel that the unsanctioned withdrawal of the sum of $7,549.10 from the Respondent's savings account on 17/05/2007 caused the Respondent to miss out on a lucrative investment opportunity with Kazzar Limited. It is the further argument by the Respondent that contrary to the parties' 24 agreement and established procedure, the Appellant converted the credit card into a debit card whereby the Respondent was forced to utilise his own finds as seen from the credit card statements of June to August 2007 inclusive {Exhibits P6 andP7). I shall first deal with the issue of loss of investment opportunity with Kazzar Limited which the Respondent contends that it was proved on a balance of probabilities. The first limb of the argument by the Respondent is that the investment offer was validly made and accepted and thus constituted a valid contract and has cited a host of authorities both case law and statutory provisions in that regard. The Appellant has disputed the copy of the acceptance letter which was tendered and admitted as exhibit by the lower court despite the same having ceased to be in the power and possession of the Respondent contrary to the requirements of the Evidence Act. The Appellant's Counsel has challenged the argument by the Respondent's Counsel that what was produced at the trial court was the original of the acceptance letter for the simple reason that the Respondent could not have remained with an original after it was sent to M/s Kazzar Ltd. Furthermore, the Appellant's Counsel submitted in rejoinder and correctly so in my view, that the record does not reflect that the original was produced by SIMBO MUSHI (PW2) who was the addressee of the said acceptance letter. The second limb of the argument by the Respondent's Counsel is that by reason of the insufficient funds in the Respondent's account, the 25 Respondent lost the investment offer and hence the loss of profits. In buttressing his argument on the entitlement of compensation and interest thereon, the Respondent's Counsel cited a number of authorities including the English case of SURREY COUNTY COUNCIL V. BREDERO HOMES LTD [1993] 1 W.L.R. 136 CA, where Honourable Steyn U dealt with issues of compensation for loss of positive or expectation interests whose object is to put the aggrieved party in the same position as if the contract had been fully performed; the decision of Mfalila, JA in the case of the Court of Appeal of Tanzania in MASOLELE GENERAL AGENCIES V AFRICAN INLAND CHURCH TANZANIA [1994] TLR 192 on the requirement for strict proof of specific claim as the basis for a court to award loss of business profits; the Kenyan case of AIR ESAT AFRICA V. KENYA AIRPORTS AUTHORITY EALR [2001] 2 EA 332 on payment of interest on the sums ordered as compensation in order to make it just and fair; the English decision of HAMBUTT'S PLASTICINE LTD V. WAYNE TANK AND PUMP COMPANY LIMITED [1970] 1 QB 447 where Lord Denning in considering an award of interest observed that its basis is the fact that the Defendant has kept the Plaintiff out of his money and the Defendant has had the use of it himself and thus he ought to compensate the Plaintiff accordingly; lastly the decision of Werema, J. in Miscellaneous Commercial Case No. 18 of 2009 in the PRINT FACTORY V. HEIDELBERG EAST AFRICA LIMITED amending the interest on an arbitral award to reflect the interest rate agreed on by the parties. The Appellant's Counsel in rejoined briefly on the contention by the Respondent's Counsel on the lack of funds in the Respondent's account as 26 a reason for loss of investment offer as well as the principles enunciated in the cases cited by the Respondent on award of compensation for loss of business opportunity in the investment deal. I am at one with the submission by the Appellant's Counsel that, it is more likely than not, that the original letter of offer having been sent to M/s Kazzar Ltd., the Respondent no longer had it and therefore could not validly produce that letter and be admitted in evidence. In that respect, as correctly submitted by the Appellant's Counsel, the trial court therefore had no legal basis at all to find and hold that the Respondent lost an investment offer by reason of any of the Appellant's acts or omissions and thus entitled to compensation. As correctly submitted by the Appellant's Counsel the suit was essentially on account of breach of banker customer relationship, which if proved would have entitled the Respondent to an award of general damages. Contrary to the trial court finding, the claim for loss of investment was not specifically pleaded, but even so, it was not strictly proved. This Court on the strength of the submissions by the Appellant and on the evidence on record finds that the trial court erred in law and fact in holding that the Respondent suffered loss of profit in the sum of USD 14,541.00 without any credible evidence to support that finding. I must state here however, that having established that there was no basis for the trial court to hold that the Respondent lost an investment offer by reason of any of the Appellant's acts or omissions and thus entitled to compensation, there is no reason to traverse the arguments and counter 27 arguments by Counsel for the parties on the issue of loss of investment offer and consequential loss of profits. The trial court having established that the Appellant negligently and unlawfully appropriated the sum of USD 3,000.00 and the sum of USD 7,549.10 from the plaintiff's United States Dollars, as correctly submitted by the Appellant's Counsel, ought to have proceeded to consider the question of general damages payable. Instead, the trial court strayed into holding that the Respondent suffered loss of profit without any credible evidence to support it. In any event as correctly submitted by the Appellant's Counsel, even assuming that the general damages would be measured in relation to the loss of profit from the lost investment offer in Kazarr Limited, still, the court could not have awarded such damages as there was no evidence adduced at the trial by the Respondent to establish that the loss of profit from the lost investment come within the ambit of the rule in HADLEY VS. BAXENDALE'S case, which also find expression in section 73(1), (2) and (4) of our Law of Contract Act. In the event and for the foregoing reasons, the 4th ground of appeal that the learned trial magistrate stayed into error of law and fact in holding that the Respondent lost an investment offer of United States Dollars 4,000 to Kazzar Ltd on 24h May, 2007; and the fifth ground of appeal that the trial court erred in law and fact in holding that the Respondent suffered loss of profit in the sum of USD 14,541 without any credible evidence to support that finding are hereby allowed. 28 In the sixth ground of appeal, the Appellant is challenging the trial court's judgment for awarding interest at the rate of 24% per annum to a Dollar account in the absence of any evidence in support of it and in ground seven of appeal, the Appellant seeks to impugn the trial court's decision to the extent that it relates to an award of interest on the judgment debt at the rate higher than what the law provides. The Respondent in reply submitted that Order XX Rule 21 of the Civil Procedure Code make the award of interest a matter for the discretion of the court which rate is within the range of 7% to 12% p.a. on the decretal sums. The Respondent maintained further that the issue of lack of agreement between the parties on the interest rate being inapplicable and irrelevant as the court has express powers to order the applicable interest rate where there is no agreement. This ground should not detain us any longer than is necessary since it is a matter of law on the exercise of court's discretion which does not require to be proved by any evidence. As correctly submitted by the Respondent the award of interest on the decretal sum is a matter for the discretion of the court. The contention of the Appellant is that the trial court awarded interest at the rate of 24% per annum to a dollar account in the absence of any evidence in support of it. Rule 21(1) of Order XX of the Civil Procedure Code, makes the award of interest at the rate of 7% per annum on every judgment debt from the date of delivery of the judgment until satisfaction mandatory. In the same measure, the law also empowers the court to award "such other rate, not exceeding twelve per 29 centum per annum, as the parties may expressly agree in writing before or after the delivery of the judgment or as may be adjudged by consent." It is this phrase which has had the parties' Counsel arguing about. There are two instances in which the court may award interest rate at 12% per annum. It is either upon "the parties expressly agreeing in writing before or after the delivery of the judgment' or "as may be adjudged by consent." Clearly in the present case there is no such express agreement in writing by the parties before or after delivery of judgment on the rate of the interest payable. The practice however, is for the party bringing the suit pray in the pleadings for the interest rate as is the case presently. In the Plaint filed by the Plaintiff/Respondent in the lower court, the Plaintiff/Respondent prayed for among other things for an order for interest on the amount of US$3000.00 negligently and unlawfully appropriated from the Plaintiff's US Dollars Account at the Commercial rate of 24% per annum from the date of withdrawal up to the date it was remitted into the Plaintiff's Master Card Account; and for an order for interest on the decretal amount at the Court's rate of 12% per annum from the date of judgment up to the date of final payment of the same. This Court, with due respect to the Appellant's Counsel, in view of the fact that the award of rate of interest is at the discretion of the court, does not see the relevancy of the claim for evidence in support of the applicable rate of interest rate. Furthermore, the argument by the Appellant's Counsel that the trial court awarded interest on the judgment debt at the rate higher than what the law provides, does not have any legal basis since the law provides for award of interest at the 30 rate ranging from 7% per annum to 12% per annum. As correctly stated by the Respondent, the court however, has express powers to order the applicable interest rate where there is no agreement. This Court however does not find any cogent reasons for disturbing the award by the lower court for payment of interest on the decretal amount at the Court's rate of 12% per annum from the date of judgment until full satisfaction. In the event and for the foregoing reasons, the sixth ground of appeal, that the trial court erred in law in awarding interest at the rate of 24°/o per annum to a Dollar account in the absence of any evidence in support of it, and the seventh ground of appeal, that the trial court erred in law in awarding interest on the judgment debt at the rate higher than what the law provides, fail and accordingly are dismissed. In the upshot the appeal succeeds and fails to the extent indicated above. The judgment and decree of the lower court is hereby upheld as follows: (i) The declaration that the Defendant/Appellant negligently and unlawfully appropriated the sum of US$3,000.00 from the Plaintiff's/Respondent's United States Dollars Account and failed to remit the same as required; (ii) The declaration that the Defendant/Appellant unlawfully and negligently appropriated the sum of US$7,549.10 from the Plaintiff's/Respondent's United States Dollars Account; 31 (Hi) Order for interest on the amount of US$3,000.00 at the Commercial Rate of 24% per annum from the date of withdrawal up to the date it was remitted into the Piaintiff's/Respondent's Master Card Account. (iv) Payment of interest on the decretal amount at the Court's rate of 12% per annum from the date of judgment until full satisfaction. (v) The Respondent shall also have his costs in the suit at the tower court and in this appeal. Order accordingly. R.V. MAKARAM BA JUDGE 28/03/2011 32 Judgment delivered this 28th day of March 2011 in the presence of Mr. Mwandambo, Advocate for the Appellant and M/S Kirethi, Advocate for the Respondent. R.V. MAKARAMBA JUDGE 28/03/2011. Words count: 8,489 33