exim bank tanzania ltd vs sai energy logistics service ltd 2022 tzhccomd 211 15 july 2022

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA (COMMERCIAL DIVISION) AT DAR-ES-SALAAM MISC.COM MERCIAL APPLICATION NO.32 OF 2022 (Originating from Commercial Appeal No.02 of 2022 at the High Court (Comm.Dvn.) DSM) EXIM BANK TANZANIA LIMITED........... ......APPLICANT VERSUS SAI ENERGY & LOGISTICS SERVICES LTD.RESPONDENT Date of the Last order: 22/06/2022 ... ’ \ Delivery of the Ruling: 15/07/2022 RULING NANGELA, J.,: This ruling is in respect of an application filed by way of a Chamber Summons supported by an affidavit of Mr Edmund Mwasaga. The Chamber Summons was filed in this Court under section XXXIX Rule 5 (1) and (3) (a),(b) and (c) of the Civil Procedure Code, Cap. 33 R.E 2019. It was brought under a Certificate of urgency. The Applicant is seeking for the following Orders: 1. That, this Honourable Court be pleased to Order Stay of Execution of the Decree of the Resident Magistrate Court of Page 1 of 10 Iringa dated 30th September 2021 in Civil Case No.4 of 2016 between the Respondent and the Applicant. 2. Costs of this Application. 3. Any other orders which this Honourable Court may deem fit and just to grant. When this matter was called for orders on the 6th of April 2022, Ms Rashida Jamaiddin, learned advocate for the Applicant and Mr Benedict Magoto Mayani, learned advocate for the Respondent appeared in Court. The parties were ordered to complete their necessarypleadings and appear in Court on the 22nd April 2022. ;On the material date, the parties were represented by Mr John Laswai learned advocate and Mr Benedict Magoto, learned advocate. This Court directed them to dispose of the matter by way of written submissions. i am pleased' that they have duly adhered to the directives of this Court and I will, hence, proceed to determine the application taking into account the affidavits filed in this Court by the respective counsels for the parties as well as their written submissions. The facts, as gathered from the pleadings, are, that, on the 25th of January 2016, the Respondent instituted a case at Iringa Resident Magistrate's Court, RM's Civil Case No. 4 of 2016 against the Applicant herein praying for judgment and decree in the sum of TZS 4,807,500.00 being monies allegedly Page 2 of 10 to be unlawfully deducted by the Applicant herein as documentation and facilitation fee and interest thereon at a rate of 25%, loss of profits thereon at a rate of TZS 300,000.00 per day, general damages to a tune of TZS 5000,000.00 and costs. A judgement was obtained in favour of the Respondent who was awarded TZS 4,807,500.00, interest at 25%, loss of profit at a rate of 250,000 from the date of deductions to the date of full payment, general damages to the - tune 'of TZS 5000,000.00 and costs of the suit. However, on appeal, the Hight Court of Tanzania, at Iringa, ordered that the matter be heard de novo. The lower Court heard the matter de novo and handed down its judgment on the 30th September 2017. Once again, the lower Court ruled in favour of the Respondent who was awarded TZS 4,807,500.00, interest thereon at 7%, loss of profit at a rate of 200,000 from the date of deductidhsTdxthe date of full payment, general damages to the tune of TZS 5000,000.00 and costs of the suit. Aggrieved by the decision, the Applicant once again preferred an appeal before this Court and served the notice to the lower Court on the 20th October 2021. Having lodged the appeal in this Court, the Applicant filed as well this application for stay of execution of the Decree in Civil Case No.4 of 2016 since the Respondent is said to have proceeded for execution of the Decree having filed execution Page 3 of 10 proceedings No.4 of 2022 at the Iringa Magnate's Court. In the affidavit in support of this application as well as the written submissions, the applicant has raised the issue of substantial loss of about TZS 652,320,940.32 on her part if the execution process is to be allowed while the appeal filed in this Court remains pending. To support the above submission, reliance was placed on the decision of the Court of Appeal in the case of Mohamed Enterprises (T) Ltd vs. Mussa Shahan Chekechea, Civil Appl. No.394 of 2018, CAT, DSM (unreported) where the Court of Appeal granted a stay order having' been satisfied that the amounts involved were substantial, in the sum of TZS 100 million. Reliance was also placed on the case of Gilbert Zebedayo Mrema vs. Mohamed Issa Makongoro, Civil Appl. No.369/17 of 2019. It was submitted That, the amount involved in the pending execution proceedings is TZS 462,320,904.32 and that; the Respondent has raised it to TZS 652,320,940.32. The Applicant contended that, the above stated amount is an excessive one; and is above the pecuniary jurisdiction of the RM's Court. Moreover, it has been argued that, the RM's Court decision is marred with irregularity and illegality and, that, this current application has been brought promptly and that, she is ready to furnish security for due performance of the decree should she be ordered to do that. Page 4 of 10 In his reply submission, the learned counsel for the Respondent has adopted the counter affidavit filed in this Court and submitted that, the applicant has approached a wrong forum since the application for execution was filed in the RM's Court of Iringa. The Respondent contended, thus, that, the stay order ought to have been filed. Relying on Rule 5(2) of Order XXXIX the Civil Procedure Code, Cap. 33 R.E 2019, the Respondent's counsel contended that the relevant court which may order a stay is the court which passed the decree. z. As regards fulfilment of the requirements under Order XXXIX Rule 5(3) (a) (b) and (c) of the Civil Procedure Code, Cap. 33 R.E 2019, the .Respondent's counsel has contended that, the Applicant's averments that she will suffer loss are not a sufficient ground to grant a stay of execution. Reliance was placed on the Court of Appeal decision in the case of Aidan George Nyongo vs. Magesa Machenja and 2 Others, Civil Appl.No.237/17 of 2016 where the Court of Appeal was of the view that, mere narration of an order requiring the applicant to pay damages to a tune of TZS 100 million was not enough to demonstrate the substantial loss to be suffered by the Applicant. As regards whether the application was made without reasonable delay, the Respondent counsel submitted that, it was with delay since, as per Rue 14 of the High Court (Commercial Division) Procedure Rules, the application for Page 5 of 10 stay of execution is to be made within 14 days of the date when the Applicant received the notice of execution or within 14 days from the date he or she becomes aware of such execution. Unfortunately, I am unable to comprehend which rule 14 of the High Court (Commercial Division) Procedure Rules, GN.250 of 2012 (as amended) the learned counsel for the Respondent is referring to, since, Rule 14 of the said GN.250 OF 2012 deals with assignment of suits. The argument, therefore, seems to be misplaced. As regards the issue of security for the\due performance, the Respondent's counsel relied on the case of KCB Bank (T) Limited vs. Abdi Amour Jecha t/a Shenan Enterprises, Civil Appl. No.275/15 of 2020 (CAT) (Unreported). In that case, the Court elaborated the issue stating that, ''.■..the Applicant for a stay order . - must give security for the due X, performance of the decree against him. To meet the condition, the law does not strictly demand that the said security must be given prior to the grant of the stay order. To us, a firm undertaking by the applicant to provide security might prove sufficient to move the Court, all things being equal, Page 6 of 10 to grant a stay order, provided the Court sets a reasonable time limit which the applicant should give the same." In a brief rejoinder, the Applicant's counsel rejoined that, the point raised by the Respondent in regard to the filing of the applicant in a wrong forum is misconceived and out of context taking in to account that there has already been an appeal preferred in this Court. It was contended that, the argument would have been valid if made before the filing of the appeal in /' ?•- this Court. \ I have gone through the rival submissions and the pleadings as well as the decisions relied upon by both parties. I find that the last point*, as contended , by'the learned counsel for z^ V • \ the Applicant is a correct position. There having been an appeal \ x filed in this Court, the application for a stay order should be made jn this Court. Even. so, the other issue which I need to determine at this point is, therefore, whether the pendency of an appeal or even a notice for intention to appeal, operates as an automatic stay of execution order. In this matter, the Applicant brought her application under the provisions of Order XXXIX Rule 5(3)(a), (b) and (c) of the Civil Procedure Code, [Cap 33 R.E. 2019], Rule 5 (3) of the Oder XXXIX provides as follows: "No order for stay of execution shall be made under sub-rule (1) Page 7 of 10 or sub-rule (2) unless the High Court or the court making it is satisfied that- (a) that substantial loss may result to the party applying for stay of execution unless the order is made; (b) that the application has been made without unreasonable delay; and \\ \ \- B (c) that security has been given by the applicant for the due performance /of- such decree or,, order as may ultimately be binding upon him. (4) ^.Notwithstanding ‘ anything contained' in sub-rule (3), the X court may make an ex parte . order for stay of execution '■ pending the hearing of the , application." (Emphasis added). This Court’did hold in the case of Jawinga Co. Ltd Vs Alistepro Investment Co. Ltd, Commercial Case No. 103 of 2012 (unreported), that the pendency of an Appeal or notice of intention to appeal does not automatically operate as stay of execution. That fact is in line with Order XXXIX Rule 5(1) of the Civil Procedure Code, [Cap 33 R.E. 2019]. Page 8 of 10 However, the vital issue that an Applicant will have to make clear is whether there are exceptional grounds under Rule 5 (1), (2) or (3) of the same Order which will warrant the granting of the stay order. Under sub-rue 3 specifically, s/he must clarify what loss is likely to occur against him if the execution is not stayed. In the case of Mohamed Enterprises (T) Ltd vs. Mussa Shaban Chekechea, Civil Appl. No.394 of 2018, CAT, DSM (unreported) the Court of Appeal granted a stay order having been satisfied that the amounts involved were substantial. T . - In this application, therd is no doubt that, the Applicant has shown the kind of loss she will likely be made to suffer should the decree be executed. Although the Respondent stated that the same is not substantial I do not consider her contention to;be validly supported. Secondly, I am also satisfied that the ''application was promptly filed. As I stated, the Respondent's argument regarding delay and reference to Rule 14 of this Court's Rules of Procedure was misconceived and irrelevant. Thirdly, as it may be noted in the Applicant's submission and the supporting affidavit, the Applicant is willing to furnish security of performance as per Order XXXIX Rule 5(3)(c) of the Civil Procedure Code , Cap.33 RE 2019. In the case of KCB Bank (T) Limited (supra) the Court of Appeal made it clear that, an undertaking to furnish security might prove sufficient Page 9 of 10 to move the Court, all things being equal, to grant a stay order. I find that, even in this case such an undertaking will be sufficient since the appeal filed in this Court is about to be heard. In the upshot of the above discussion, therefore, this Court settles for the following orders: 1. That, the execution of the Decree in RM's Civil Case No.4 of 2016 pending in the Iringa RM's Court, is hereby stayed pending the hearing and determination of the Appeal No.02 of 2022 before this Court. 2. The Applicant is to avail to the Court undertaking to furnish security for the due performance of the decree. 3. That, this application is granted with costs. It is so ordered DATED AT DAR-ES-SALAAM ON THIS 15™ DAY OF JULY 2022 ON. DEO JOHN NANGELA JUDGE Page 10 of 10