GOLD CREST HOTEL LIMITED VS

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA IN THE SUB-REGISTRY OF MWANZA

AT MWANZA MISC. CIVIL APPLICATION NO 2458 OF 2024 (From Land Case No. 22 of 2023) GOLDCREST HOTEL LIMITED …………………………………………. APPLICANT

VERSUS TAI FIVE HOTEL LIMITED ………………………………………. 1ST RESPONDENT THE REGISTERED TRUSTEES, PUBLIC SERVICE SOCIAL SECURITY FUND (PSSSF) …………………………… 2ND RESPONDENT THE ATTORNEY GENERAL ………………………………………. 3RD RESPONDENT

RULING 19th & 29th April 2024 CHUMA, J. By chamber summons, the applicant is seeking this court to grant leave to, first depart from its scheduling Conference order set on 22nd August 2023 in order to determine applicant’s application seeking court leave to amend its written statement of defence and second the Applicant to amend its written statement of defence in Land Case No. 22 of 2023 which is due for hearing. The application is supported by the affidavit of Constantine Mutalemwa the counsel for the applicant and Sebastian Germanus the principal officer of the applicant. The application is contested by the affidavit of Mr. Wilson Christopher Tarimo the principal officer of the 1st respondent while the 2nd and 3rd respondents filed no counter affidavit. 1 It was the disposition by Mr. Mutalemwa in the affidavit that the applicant was previously represented by FK Law a law. he was later on engaged and discovered that most of the facts leading to the institution of the Suit have not been pleaded in the Applicant’s written statement of defence by the Applicant. He also noted that most of the documents important in determining the real issues in controversy between the parties to the Suit have neither been pleaded nor attached to the Applicant’s Defence. That, the respondents will not be prejudiced in any way if this Application is granted and it will enable the Court to justly

and timely solve the real issue in controversy. The counter affidavit contested the application that, FK Law Chambers presented the applicant was competent to draft the Written Statement of Defence. The applicant’s new documents are intended to be brought as an afterthought to impede justice and cause unnecessary prejudice to 1st Respondent who has already commenced a hearing of its case by presenting the witness statements. The application proceeded through written submissions. The submissions for the applicant were filed by Constantine Mutalemwa. While Mohamed Tibanyendera and Joseph Madukwa filed the submissions for the respondents. The 2nd and 3rd respondents did not file the submission. 2 It was the submissions of Mr. Mutalemwa that there are very crucial facts, and documents that need to be pleaded in the Applicant’s Defence. That, those facts and documents are so important that if not pleaded, the Court might not have an opportunity to fairly and justly determine the suit. That the 1st respondent’s counter affidavit has only responded to the second affidavit sworn by Advocate Constantine Mutalemwa therefore the affidavit by Sebastian Germanus was not counted. That, in law, if amendments are intended for purposes of clarifying the facts, already pleaded, a court of law allows such amendments as well underscored by Mogha’s Law of Pleadings, 15th edition, Eastern Law House,

New Delhi, 1998 at pages 150- 151 that; “...But there may be no objection to allowing an amendment which neither takes away the effect of any admission made in the original pleading nor raises any inconsistent plea by changing the character of the pleading but merely elucidates and clarify it...” The intended to be pleaded are to enable this court to determine the controversy against the parties in a fair and just manner. That, the Mogha’s Law of Pleadings (supra) states on page 137 that; 3 “...All amendments ought to be allowed which satisfy the two conditions (a) of not working injustice to the other side, and (b) of being necessary for purpose of determining the real question in controversy between the parties...”. That, in the instant matter, the applicant, in its original written statement of defence, denies and/or disputes to have frustrated the lease agreement of suit premises and as such the applicant intends to amend its defence by clarifying its denials by pleading more facts as embodied in the lease agreement and other documents and letters as attached to the Chamber summons which was filed on 06.02.2024. In other words, the applicant intends to clarify its non-involvement in the lease agreement allegedly to have been frustrated by other parties by pleading more facts and attaching more related documents, without changing the nature of the case or negating any

admissions already pleaded, if any. He further submitted that no miscarriage of injustice was expected from the other side by amending any pleading if the said party can be compensated by costs as stated by Mogha’s Law of Pleadings (supra) on page 139 that, 4 “...the amendment should be allowed if it can be made without injustice to the other side. There is no injustice if the other side can be compensated by costs...” He further submitted pleadings can be amended at any stage of proceedings as stated in the case Jovent Clavery Rushaka & Another versus Bibiana Chacha, CAT, Civil Appeal No. 236 of 2020 page 12 that; “...it is settled law that a pleading can be amended at any stage of the proceedings only to the extent allowed by the court on such terms as may be just and such amendment should be limited to what will be necessary for determination in dispute between the parties....” Further, amendment of pleadings can be made even after the closure of the plaintiff’s evidence as observed by Mogha’s Law of Pleadings (supra) on page 141 in which it is stated as follows. “...an amendment may be allowed at any stage of the proceedings even when the case is reserved for pronouncing judgment, at the instance of either party to the suit even after the closure of the plaintiff’s evidence even at the appellate stage...” Moreover, it further submitted that in the course of allowing

the amendment of pleadings a court of law has powers to set the 5 parameters/limits of the intended amendments as clearly stated in the case of Jovent Clavery Rushaka & Another versus Bibiana Chacha (supra) at page 12. In respect of the intended amendments which were challenged on account that Advocate Constantine Mutalemwa had confidential information, it was the applicant's submissions that those alleged confidential information was not disclosed in the counter affidavit sworn by Wilson Christopher Tarimo. He therefore prayed for this application to be allowed. Contesting the application, it was contended that, both affidavits supporting the Application were objected to in specific particulars stated in the affidavits of Wilson Christopher Tarimo which were filed separately. That, they do not dispute the guidance of the renowned author as quoted by the applicant. However, the application at hand has fallen short of the basic condition precedents as laid down by Mogha’s Law of Pleadings. The key conditions for the court to exercise its discretionary powers to grant an amendment to pleadings are stated by Applicant’s counsel through quotations made on pages 137 and 150-151 of the said Book, Mogha’s Law of Pleadings (supra) as quoted by the applicant that; one, an amendment should not cause injustice to the other side; two, The amendment should 6 be necessary for purposes of

determining the real question in controversy between the parties; three, the intended amendment should not take away the effect of any admission made in the original pleading; and four, the amendment should not raise any inconsistent plea by changing the character of the pleading but merely elucidates and clarifies it. That, the submission by counsel for Applicant is based on only one condition that the intended amendment will assist the court in determining the controversy between the parties in a fair and just manner. Therefore, the application is based on one condition out of the four tests laid down by Mogha’s Law of Pleadings (Supra). Further, the learned counsel does not state which controversy between the parties has remained unanswered in the original Written Statement of Defense (WSD) filed by the Applicant and verified by the same person, Sebastian Germanus. The applicant has not stated how the sanctity of pleadings is protected after the amendment as far as conditions number 3 and 4 are concerned. The Affidavits supporting the Application do not state what needs to be clarified or elucidated by the intended amendment which was not pleaded before. The applicant has made several admissions in the original Written Statement of Defence. That, the intended amendment is calculated to change the character of the original 7 pleadings by removing the admissions and making a

totally different approach at the time when the 1st Respondent herein has already submitted to the court, all the material evidence through witness statements. The issues have already been framed by the court which need to be determined by way of evidence hence, allowing a blank amendment at this juncture is nothing but a serious prejudice to 1st Respondent who has taken all the necessary steps to comply with court orders and schedules. That they did not object to the holding in the case of Jovent Clavery Rushaka & Another vs Bibiana Chacha (supra) where the court was referring to Order VI Rule 17 of the Civil Procedure Code, Cap. 33 (hereinafter the CPC). However, the facts of that case are distinguishable from the facts at hand. That, the Applicant has not stated which paragraphs in the original Written Statement of Defence are intended to be amended. He has not even attached a draft written statement of defence for the court to rely upon to set the conditions for the intended amendment. This means the Amendment is general to the extent of changing the whole defence and making new aversion. That, the applicant would have used a golden room for seeking leave of this Court to file a list of additional documents for such purposes rather than praying for Amendment. That, in Commonwealth countries, the 8 principles governing applications for the amendment of pleadings

were succinctly summarized by White, J. in Commercial Union Assurance Co. Ltd v Waymark No 1995 (2) SA 73 (Tk) at 77F-I. 7 [22] as followed in the case of Vallun v Malan and Another (47599/2021) [2023] ZAGPPHC 870 (31 July 2023) that; “The court has discretion whether to grant or refuse an amendment. An amendment cannot be granted for the mere asking, some explanation must be offered therefore. The applicant must show prima facie that the amendment has something deserving of consideration, a triable issue. The modern tendency lies in favour of an amendment if such facilitates the proper ventilation of the disputes between the parties. The party seeking the amendment must not be mala fide. The amendment must not cause an injustice to the other side which cannot be compensated by costs. The amendment should not be refused simply to punish the applicant for neglect. A mere loss of the opportunity of gaining time is no reason, in itself, for refusing the application. If the amendment is not sought timeously, some reason must be given for the delay. The granting or refusal of an application for the amendment of a pleading is a matter for the discretion of the court, to be exercised judicially, in light of all the facts and circumstances before it.” 9 They submitted further that, in Moolman v Estate Moolman 1927 CPD 27 at 29 where Watermeyer J said; “The practical rule adopted seems

to be that amendments will always be allowed unless the application to amend is mala fide or unless such amendment would cause an injustice to the other side which cannot be compensated by costs, or in other words unless the parties cannot be put back for the purposes of justice in the same position as they were when the pleading which it is sought to amend was filed.” According to them, the parties to this case cannot be put back to the position as they were when the pleadings that sought to amend were filed; the Plaintiff will have to make a new line of evidence, witnesses and other particulars; Court framed issues are bound to change due to the nature of amendment; and the witness statements will also change to meet newly pleaded facts. That Costs cannot restore the damage caused to 1st Respondent due to the amendment. That, in East African case of Eastern Bakery v Castelino [1958] EA 461, Sir Kenneth O’connor P stated as follows: - “…It will be sufficient, for the purposes of the present case, to say that amendments to pleadings sought before the hearing should be freely allowed, if they can be made without 10 injustice to the other side, and that there is no injustice if the other side can be compensated by costs…. The court will not refuse leave to allow an amendment simply because it introduces a new case…. But there is no power to enable one distinct cause of action to

be substituted for another, nor to change by means of amendment, the subject matter of the suit… The court will refuse leave to amend where the amendment would change the action into one of a substantially different character; or where the amendment would prejudice the rights of the opposite party existing at the date of the proposed amendment e.g. by depriving him of a defence of limitation accrued since the issue of the writ.” That, in this matter at hand, the applicant intends to introduce new facts to the original pleadings which will change the nature of the case. That, Similar application like the one at hand was refused by the Supreme court of Ireland in the case of Smyth v. Tunney [2009] IESC 5; [2009] 3 I.R. 322 where it was inter alia stated that; “In summary the law as to amendment now is that an amendment will be allowed if it is necessary for the purposes of determining the real issues in controversy between the parties. The addition of a new cause of action by amendment will be permitted notwithstanding that by the date of amendment the Statute of Limitations had run if the facts 11 pleaded are sufficient to support the new cause of action. Facts may be added by amendment if they serve only to clarify the original claim but not if they are new facts. Simple errors such as an error in date or an error as to location which do not prejudice the defendant and enable

the real questions in controversy between the parties to be determined will be permitted…” With regards to the confidential information held by Mr Mutalemwa, they submitted that the said advocate admits having performed attestation of attached documents to counter affidavit. That, the said documents are relevant to the case at hand. Mr. Constantine Mutalemwa has always been a personal legal advisor of the 1st Respondent in his capacity as an advocate. He has written a number of confidential legal documents including undertakings to the Tanzania Revenue Authority, Affidavits of company directors of 1st Respondent, commercial consultation advice, corporate legal advice and many others. The change of mind to start representing the opposite party to the case which is about to be heard is clear proof that Mr. Constantine Mutalemwa intends to use the information acquired by virtue of normal advocacy business from the 1st Respondent in favour of the Applicant. No wonder he has come up intending to amend pleadings so that he can bring in some confidential information which may prejudice the 1st 12 Respondent in this dispute. We humbly pray that Mr. Constantine Mutalemwa should not be allowed to prosecute the case against the 1st Respondent. In the alternative, the application should not be granted as the same is made mala fide. The motive of this application is to cause embarrassment

to 1st Respondent through advocate Constantine Mutalemwa who has always been a legal advisor of the 1st Respondent and all its directors. 8 We wish to bring to the attention of this court the provisions of Rules 30 and 31 of the Advocates (Professional Conduct and Etiquette) Regulations, 2018 (GN No. 118 of 2018). They finally prayed for the dismissal of this application with costs In rejoinder, Mr. Mutalemwa reiterated the submissions in chief. He however added that, both parties are at one that in law the amendments are allowed for the purposes of clarifying the original pleadings as stated by Mogha’s Law of Pleadings, (supra). That, the intended amendments are only being sought to clarify the denials of the frustration of the lease agreement and all the monetary claims. Therefore, if such amendments are allowed the controversy of the frustration of lease agreement as alleged will be fairly and justly understood and determined by this court and equally, this court will determine who amongst the defendants is liable to bear the reliefs 13 as prayed for in the main case. That the admissions already made will not be negated/changed. Further, any injustice will be compensated in terms of costs. That, the case of Eastern Bakery and Castelino (supra) have been cited out of context and do not apply in the application at hand. Those commentaries bar the amendments of the plaint which

introduce the new cause of action or the written statement of defence, which raises the new claim; like a counterclaim, which denies the plaintiff the right of limitation, which is not the case at hand. Regarding the allegations that Advocate Constantine Mutalemwa possesses confidential information, it was submitted that attestation of documents does not put the same advocate in a conflict of interest as similarly observed in the case of Amiri Abdallah Kilindo versus Global Securities Finance and Insurance Ltd, civil case No. 220 of 2002, (unreported). Having given due consideration of the rival submissions of both Learned counsels for the parties, the chamber summons along with the affidavits for and against the application, I commend both counsels for the applicant and the 1st respondent for their thorough research. This court is duty-bound to determine whether the instant application is meritable. 14 The affidavit of Sebastian Germanus supports the amendment and it was not counted by the 1st respondent by the affidavit. It is a settled law that matters of facts need to be contested by an affidavit otherwise are deemed to be admitted. It is a settled position of law that this court may at any stage of the proceedings allow either party to alter or amend his pleadings upon proof that such amendments are necessary for the purpose of determining the real questions in controversy

between parties. This legal stance is in respect of the provisions of Order VI Rule 17 of the CPC which provides; 17. The court may at any stage of the proceedings allow either party to alter or amend his pleading in such manner and on such terms as may be just, and all such amendments shall be made as may be necessary for the purpose of determining the real questions in controversy between the parties. However, it should be noted that, for the court to allow amendment of pleadings three conditions has to be met, one, the application is made before the hearing starts, second, the amendment is necessary for the purpose of determining the real questions in controversy between the parties 15 and third that, such amendment can be made without causing injustice to the other party The Court Appeal in the case of George M. Shambwe Vs. Attorney General and Another (1996) TLR 334 (CAT)in re-affirming and restating the principle as stated by the Court of Appeal for Eastern Africa in the case of Eastern Bakery Vs. Castelino (1958) E.A 461, where the Court observed that: ’’We need also to reaffirm the principles upon which amendments to pleadings should be made. These were stated by the Court of Appeal for Eastern Africa in the case of Eastern Bakery Vs. Castelino. That Court stated at 462, It will be sufficient for the purposes of the present case, to say that amendments to pleadings

sought before the hearing should be freely allowed, if they can be made without injustice to the other side.’’ From the above authorities, I am in agreement with the submission of the respondent which is also a stance of the applicant’s submission that amendment may not be allowed if it intends to introduce new facts which might change the nature of the case. The same as provided in Mogha’s Law of Pleadings, 15th edition, Eastern Law House, New Delhi, 1998 can be allowed if the following is established one is that it should not cause injustice to the other side; it must be necessary for purposes of determining 16 the real question in controversy between the parties; the amendment should not take away the effect of any admission made in the original pleading; and the amendment should not raise any inconsistent plea by changing the character of the pleading but merely elucidates and clarifies it. Regarding the powers of this court to depart to the scheduling conference orders, the law under Order VIII Rule 23 of the CPC states that, departure shall be made where the court is satisfied such departure or amendment is necessary in the interest of justice. And when the prayer for departure is granted the applicant shall bear the costs unless the court decides otherwise. The said Order VIII Rule 23 of the CPC provides thus: “Where a scheduling conference order is made, no

departure from or amendment of such order shall be allowed unless the court is satisfied that such departure or amendment is necessary in the interests of justice and the party in favour of whom such departure or amendment is made shall bear the costs of such departure or amendment, unless the court directs otherwise”. The 1st respondent contests the application for the reason that the same will prejudice the 1st respondent because he had already filed a witness statement awaiting tendering of exhibits and cross-examination. Further, it 17 was alleged that the amendment may result in a new cause of action which might change the character of the original pleadings by removing the admissions and making a different approach. No specific paragraphs were stated by the applicant which are subject to intended amendment. And that the counsel for the applicant held some confidential information and relationship with the 1st respondent which might be used unfairly to him. In my view, I decline to join hands with the submission of the first respondent's counsel that the sought amendment will change the cause of action by the Written Statement of Defence (WSD). The one who is suing is the one who set his cause of action against the defendants. The WSD only tells the defendant’s line of defence. Gathered from the affidavit and the submissions for the applicants, the applicant intends only

to clarify those facts which have already been pleaded for the purposes of determining the real question in controversy between the parties. The intended amendment according to the submissions of the applicants will not take away the admission made in the original pleading; or raise any inconsistent plea by changing the character of the applicant’s line of defence but merely clarify them. The 1st respondent did not tell how the intended documents to be attached are not relevant to the matter in controversy. Therefore, in this 18 circumstance, the 1st respondent stands not to be prejudiced by the amendment. Regarding the raised fear that advocates Mutalemwa held some confidential information of the 1st respondent is out of the contest. The 1st applicant is at liberty to object that the respective advocate cannot represent the applicant in the suit in accordance with the law. What is before this court is an application for amendment of the WSD by the applicant only. As to the issue of failure to append a draft of the intended WSD Mr. Mutalemwa said nothing about it but even the respondent's counsel never explained under which provision of law his argument was based. I don’t think it is a law requirement so to speak. Again, this point is out of place. This court is then satisfied that, in the interest of justice the sought departure order is necessary to enable the applicant to

file amended WSD. It is this court’s findings that the application has merit and allowed. However, the amendment should only be confined to the areas of the amendment stated in the affidavit supporting this application. In the end result I hereby allow departure from the scheduling order made on its scheduling Conference order set on 22nd August 2023 and I 19 proceed to grant leave to the applicant to amend the WSD to accommodate the important facts as sought for with a view to determine the real question in controversy between the parties. In the event, the amended Written Statement of Defence be filed within 14 days from the date of delivery of this ruling. The applicant to bear costs for the amendment. It is so ordered. Dated at MWANZA this 29th day of April 2024. W. M. CHUMA

JUDGE Ruling delivered in court before Mr. Mutalemwa learned counsel for the applicant, Mr. Madukwa Learned counsel for first respondent and Mr. Allen Mbuya Learned State Attorney for second and third respondents this 29th day of April 2024. W. M. CHUMA

JUDGE 20