20111005 TZHC Dar es Salaam

,,.:)'~... 'j l ' ,..:. '-':" """ \ ., ·I IN THE HIGt·i COURT OF TANZA~J.A ,..Ai "Ii...M£ o: "."'~'"T'R·-rr (DAR Es ::,,-._.t-...f-' l~, h_. R;::GIST' ·- """Y) · K. AT Dt-.R ES SALAAM I I MISC, CIVIL APPLIC~T!ON NO. 78 OIF 2009 !\ GUNDELINDA V\fENDELINE "" ............. ,.. ........ . J. ... APPLIC!.\NT I I' N!-\TIONAL INSUP~NCE CORPORf~TION I • .,.,~ ... ,rA IT·D st ..)ECPO"·1 0E·· 1~~ O•[':r::'..,~,.l!\ [ j,.l~1'!l..l.:\.1'<! - i'i , '""""""""'""""'"'"",:,~··· .... " ........ " .. '' (· K ;;::;. - ['1 ·-n1 I ,# r CONSOLIDATED HOLDINGS CORPORATION """'"' \2No RESPONDENT ·I II Date of last submissions: 02/08/201; \ 1 Date of Ruling: 05/10/2011 · \ \

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RU UI NG I :I I I F. Twaib, J: I 11 :'1 before me is an application for leave to institute an app/ication for an order that the Respondents pay the Appli(1ant the decretal 'amount granted to her by the RM's Court, Kisutu on 19tf May 2011 in Ci~ic Case f\.lo. 130 of 2006. The chamber summons bases the application o~ section 43 of the Public Corporations Act, 1992 as amended by Act No. 26 of 2007 and section 9 · of the Bankruptcy Act, Cap ~5. It is supporteili by the Applicant's own affidavit. The Respondents haJe resisted the a\pplication. The 1st ~espondent has filed a counter affidavit, svvorn _by one ·\red Mwakifuna, lts Ii, . !I . . I Page I of 7 I .·· ~---------~ ... - -.,, .I r '(.:",.~:::;.,: ~-, -~-,,-·" :~tmm:i:ll'.~t:0:bllt;fi}_r;:~w:tiiF'(':t;il{~11. ??\i:~t:p'a+; l;.'i:1:1%rrt,:.?.t~:~~ii[l~ft!~~t~~t~::o}fo/,B?'ifffIT:f.~~imr~tii;o/.~~rrrJ:3t¥~~1~~1:f~~;,J:W~~I}:f/:itfftJ - T~,~ .•-• ~\ I'. I Acting Chief Legal Counsel. The 2nd Respondenfs counter aff]davlt is by its Director of Litigation and Liquidationr one Albert Seng'indo. lt is pert1nent to begin this .ruling with a brief look at the background to the appiication. In Civil Case No. 30 of 2006 (RM's Court, Kisutu) 1 the applicant sued Dr. paul M. Masawe and Khalfan Mohamed for compensation for injuries. she sustained in a road accident caused by Dr. Massawe's car1 Toyota Corona ·Reglstratlon Nci. TZl_ 6474,

which was betng driven by Mohamed. The Rrvrs Court found for the Applicant and awarded . her TZS 10 Million as gener-,:! damages. Because the car v.;as \nsur·ed by the 1st Respondent,. the fa.pp!lcant sought payment from the insurance company. The 1st Resp?ndent denied liabllity and r·efused to pay. Since the 1st Respondent had been placed under the statutory receivership of the 2nd Respondent 1 the Applicant filed the present application, In response to the application 1 the 2nd Respondent flied, together with is counter-affidavit 1 a notlc:e of preliminary objection, raising two points of !aw in limine, nar·ne)y: 1. The application is grounded upon an enabling provision of the iaw which is non-existent; or 2. The application does not fail under the purview of the prnvisions of section 9 of the Bankruptcy Act 1 Cap 25 (R.E. 2002). It is to be noted that the use of the word \\or" between the two grounds of p1-eiiminary objection makes them alternative to each other and therefore mutually exclusive. However,. the parties apparently did not notice this, In any case, however; in view of my findings herein, it does not matter whether one considers the tvvo grounds mutually exclusive or not. I do not intend to waste time on the first point of p:·e!irninary obj::ct.ion. I would dismiss it fm lack of merit. Given· recent decisions of t!-;2 C.ou~t of ?2.2:e. 2 af 7 ..r ~ ' - i

. _........... .., ,.,.~ .. ,,,): 'Jialill i:tr.:/\ 1~f:8:,·,. •~ ,4••··•:_ Appeal, I hold that the mere orn'iss:io to cite the subsection that vests the Court with jurisdiction to entertain n application does not render the application incompetent: See lVicholctS Ham,,~c;/ & 1013 Others v Tanzania 1 Shoe Co. Ltd & 2 Ors Civil App!iclation No. 54 of, 2.009 (CAT, DSM, ~1'.1reported), andfarid Ahrr,ed II Sca~ia (T) Ltd. (CAT, DSM, unreported); 1n1s change of sr.ance by their L.ord~rnps and Ladyships rn the Court 01 .A,poeal ls a welcome development j, It ensures that so far as possible, disputes that are brought to Court · re decided on r-r,erit rather than on rne1·e technicalities, and that CoJrts would endeavour to achieve substantive justice, ·~s required by A~icl'2 107A of the. Constitution of th:?. United Republic. The second point of preliminary object.ion deserve much more effort. In support of this ground,, counsel F· 'ngamtama for the 2'1c Respondent submitted that it was wrong for the :Applicant to file this application and 1;--1volve the 2nd Respondent because 1her clairn is not a \\debt provable in bankruptcy" in terms of section 9 (1) q:if Cap 25. Counsel referred the Coui'.: to the desGiption of debts provable i , bankruptcy contained in section 35 (3) of Cap 25. It states: \\Save as aforesaid, all debts an iiabliities, present or future, certain or contingent, to

which the d_ .btor is subject at the date of the · receiving order, shall be d, erned to be debts provable in bankruptcy." Counsel further cited the case of Sanyou Service Station Ltd. v BP Tanzania Ltd., Commercial Case No. '05 of 2002. Kalegeya, J. (as he then was), interpreted the above provision, s follows: \\T~e ~atch phrase/wo.rds in_ qui ~tion were, by design, u~ed b: ~he leg1s!a-cure to cover oebts in 1:zx1stenc2 before the making or rhe receiving order and 1 in our cas r in t,2rrns of the Public Corporations Ac., 1992, as amended by ,!>...ct f o. 16 :)f 1993, before the making of ~ "~~~~~~~~~~~~~~:,,•, 'S1 ..,. ; ·{, specifying order by a Minister under section 38. So, for existing debts, provable under bankruptcy, lf it came to that, !eave to sue must be sought and secured but not for any other daim." In his reply submissions, Co.unsel J.A. Lyimo for the Applicant stated that. the words " ... present or future ... " and " ... to which he may become liable before his discharge", meant that s 38 (3) of Cap 25 covers not only debts and liabilities existing pi-ior to the receiving or·der, but aiso those coming into existence thereafter. As Mr. Fungamtama rightly observed in his rejoinder submissionsr Mr. Lymo omitted a crucial point of the subsection of debts "incurred befcwe the date of the receiving order." He urged the Court not to follow Sanyous Case as it was decided

per incurium. Mr. Lymo_ prayed that in the event this Court agrees with Mr. Fungamtama on this point, then the appiication should be struck out 1 rather than nd dismissed as prayed for by the 2 Respondent. st The chronology of events in the present case shows that the 1 Respondent's receivership commenced with its specification and pub!ication thereof in GN No. 33A on 1th June 1998. Counsel argues that since the Applicant's judgment at Klsutu was handed down ten years after th the said publication, on 19 May 2008 1 the applicant's claim is not a "debt provable in bankruptcy" and therefore doe:::. not fa!I within the purview of s 9 of Cap 25. \/\fith respect, Counsel has put the facts slightly wrong here, even though doing so does not make much difference for our purposes. On a true . construction of s 35 (3) of Cap 25, what is important is not the date the judgment and decree was obtained 1 but rather, the date the cause of action arose. That is what I consider to be the import of the phrase " ... all debts and liabilities 1 present or future .. .to which the debtor is subject at the date of the receiving order,. or to which he may become before his Pa;re ~' 4 of 7 . - ..•· ···. :·;::·,~•.'-- ;. dfH ' . / . I ., . ' discharge by reason of a·ny obligation incurred before the date of the receiving order ... " , The Respondent's receivership took effeb on 12 th June 1998. The

accident occurred on 1ih August 2003. It is Mr.I Fungamtama's position that any -liability arising out of that incident cann± be a debt provable in bankruptcy in terms of s 35 (3) of Cap 25, for th simple reason that it is not an obligation that was incurred before the ate of the receiving order. In view of the foregoing, it is my finding tha~ the second poi~t of pr·eliminary objection has merit and I hereby sustainlit. Having held as I have done, wha remains is to· determine the consequences of that finding: Whether ~o dismiss the application or strike it out, as Mr. Lyimo suggested. Couns~I, however, has not said why he prefers dismissal to striking out. It is hdwever not difficult to speculate his reasons. I think the problem visiting 1Jarned counsel for the Applicant is the consequences of an order of dismi$al. He is concern;ed that dismissal wouid mean that his client cannot brin~ another applica_tion of the same nature again. An order striking out the application will,. however, enable her to file a similar application if she sd wishes-subject,: of course, to the Iaw of ,.11m1"tat·10n. ! 1 This appears to be the thinking am ng many lawyers. In my view, however, with all due respect, that gl neraiisation ls i~correct. It is not alvvays the case that once a matter is '1:lismissed, I . . it cannot be re-filed. For instance, where a suit is filed out of time, rt is liable to

an order of dismissal. However, if it is not too iatk, the Plaintiff can re-file the case upon securing leave from the Ministbr responsible for Justice (before expiry of not more than one half of the statutory period)., I have tried to find a precedent that would guide me on 'this. In the end, I must admit my failure to find one. But .there is a clear trend in the decisions of the Courts, both at the le el of this Court and of th,2 Court of ; Page5of7 .A.ppea!, from which a conslstent principle can be discerned. I think the principle is to be found in the following two guideiines: 1. That the question as to whether a striking out order is to be given or an order of dismissa! is to be decided not on the whims of the Court1 and neither is lt one calling for the exercise of the Court's discretion. It is dictated by the reasons why the proceedings befoi-e the Court have to be terminated. 2. \Nhere the application or matter is not maintainable by reason of a technical defed 1 such as where 1 for inst:ance 1 an appeal is filed without including a copy of the decree or order appealed from, the same is to be struck out. That means, the losing party may bring it afresh. If, on the other hand, -the matter is not maintainable due to an issue of substance, such as non- disclosure of a cause of action, or lack of jurisdiction on the part of the Court, or time-bar 1 then it ought to be

dismissed. Though this means that a matter that has been dismissed cannot be re- filed in the same form 1 it may, in appropriate circumstances and after curing or removing the defect, be re-instituted. I have ventured to describe the circumstances under which the Court may decide which orders to make. But1 as I have stated, it is not within the Court's discretion to decide one way m the other. It is to be decided depending on the grounds for termination. I do not pretend to be exhaustive. Neither do I claim to be entirely correct. However, I am settled in my mind about what 01-de1· to give in respect of the present case. Given the nature of the two points of preliminary objections, if the first one (based on a technicalrty) only succeeded, I would have struck off the application. The Applicant would be free to re-file it more appropriately. fa.s it happened, only the second point succeeded. The shortcoming is a substantive one, in that the orders sought herein need not be obtained by the Applicant at all. It goe:~ to the root of the matter, in that the Page 6 of 7 ....,, •.. ~ ~ ., ( - :~~:... :,· --•.,. ,.:~-,"!~-,;*~~."!'.\~;, -·,~F~-~ ·-·-- application ought not to be instituted at al!. It means that the application I, ; cannot be re-filed. •' I That is the ultimate result of my findings herein. The applicant does not have to Ale an application for leave to proceed against

the 1st Respondent1 I • if she still so desires, for execution of her decree 1 because her claim is not a debt provable in bankruptcy. That being the case, therefore, this application ought to be dismissed. I dismiss it with costs. Dated at Dar- es-· Salaam this 5th day of October 2011. , --·:·-· _\1~7 "- i; . 1 ~._: i Fau2Tv1~ Judge 5th October 2011 Delivered Jw.~ourt this 5th day of octbber M)11. ~ z Twaib (__/ Judge . 5th October 2011 Page7of7 . - , .•· -... "i~ ...-- ~ __.. -: - . _.,._.,.·~--· -,.--..· _;•-,,