HUDAA NASSOR scanned

IN THE HIGH COURT OF TANZANIA (LAND DIVISION)

AT DAR ES SALAAM MISC. LAND APPLICATION NO. 28306 OF 2024 (Arising From Land Case No. 22260 of 2024, Land Division) HUDAA NASSOR SALUM........................................................................ APPLICANT

VERSUS LEONARDO RIGONI....... ........................... RESPONDENT

RULING 5th to 19th February, 2025 E.B. LUVANDA, J The Applicant is seeking for an order of stay of the proceedings of Land Case No. 22260 of 2024 between Leonardo Rigoni vs Hudaa Nassor Salum and subsequently refer the parties to arbitration subject to the arbitration agreement. In the affidavit in support of the application, the Applicant pleaded to have entered into the sale agreement with the Respondent for purchase of a landed property described as Plot No. 305, bearing certificate of title No. 30262 located at Mikocheni Phase II comprising half of the total plot measuring 726 square meters, as per copy of the sale agreement, annexure AI to the affidavit. That during subsistence of the sale agreement, the Applicant through various avenues including through the Respondents lawyers requested the Respondent provide necessary documents and further requested the meeting to finalize i outstanding payments since June 2024 but the Respondent outright refused. That surprisingly the Respondent wrote a letter to the Applicant intimating that the Applicant commence arbitration proceeding as per clause 7.0 of the sale agreement following what he termed as a breach of the sale agreement on his part, as per a letter annexture A2. That the Applicant on receipt of the Respondents letter requested a joint meeting to finalize the matter once and for all and effect necessary payments as they

did not see any impeding dispute nor any breach save for the Respondents refusal to accept outstanding sum was seen as a folly by the Applicant who failed to understand the proper reason for the refusal of the same, as per a letter annexture A3. That surprisingly the Respondent proceeded to institute Land Case No. 22260 of 2024 despite being fully aware of the agreed dispute resolution clause in the sale agreement which completely ousted this Court and its jurisdiction thereto as the parties had subjected themselves to arbitration subject to the Tanzania Institute of Arbitration and the Arbitration Act of 2020. That as per the sale agreement, an arbitration agreement exists between the parties hence any dispute in relation to this matter must be adjudicated through the agreed dispute resolution mechanism. That following the above fact, the Applicant has seen it just and prudent to request this Court to refer the parties to this dispute to the arbitration agreement as contained in the sale agreement and subsequently stay all 2 proceedings of this suit until attempts for amicable resolution fail and consequent arbitration have been fully determined between the Applicant and the Respondent. In the submission, the Applicant submitted that the gist of this application is based on the fact that on the 22/12/2023 the parties herein entered a sale agreement for the sale and consequent

purchase of a suit property. She submitted that this Court has no jurisdiction on the explanation that article 7 of the sale agreement (annexture Al to the affidavit) requires that any dispute between the parties to be resolved amicably, failure of which the parties are to resort to arbitration at the Tanzania Institute of Arbitrators and the dispute shall then be resolved in accordance with the rules and procedures and in a mode to be agreed by the parties. She submitted that under the principle of sanctity of contracts, contracts should be honored and that the parties involved should fulfill their obligations under the contract, arguing that in this case parties agreed to submit any dispute to arbitration which in effect ousts the jurisdiction of this Court. She submitted that article 7 is a provision that is a choice of law, forum and mode of dispute resolution. She submitted that the applicable method and law chosen by the parties is arbitration through the Tanzania Institute of Arbitration as opposed to court jurisdiction through litigation which is the case where the Respondent herein decide to institute Land Case No. 2260 3 of 2024 which goes against the sanctity of the contract by the parties through their choice of dispute resolution. She cited Abualiy Alibhai Azziz versus Bhatia Bros Ltd [2002] TLR 288, which held that that parties must adhere to the terms of the

contract under the principle of sanctity to contract. Also cited Alchemy Resources Ltd vs Impoexpo Logistics Co. Ltd,Commerda I Case No. 012187 of 2024, HC. [2024] TZHCComD 228 (13 September 2024) She submitted that this Court has no jurisdiction to entertain this dispute and should refer the matter to arbitration as per the parties choice of dispute resolution mechanism through the sale agreement of the land in dispute. It is to be noted that the Respondent neither filed a counter affidavit nor filed a reply to the Applicant submission, which imply concession on his part. According to clause seven of the sale agreement, annexure Al to the affidavit in support of this application, provides for the mechanism of dispute settlement between the parties, I quote, 'Any dispute arising from or in connection with this Agreement shall be settled amicable between the Parties, failing which the matter will be referred to Arbitration as provided for by the Arbitration Act 2020 and shall be adjudicated by the Tanzania Institute of Arbitrators in accordance with their rule and procedures and in a mode shall be agreed by the parties hereto' 4 It is the law that, where there is a submission clause in the contract, the Court is duty bound to refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists between the parties. Section 12(1) of

the Arbitration Act No. 2 of 2020, Cap 15 (R.E. 2020), A court, before which an action is brought in a matter which is the subject of an arbitration agreement shall, where a party to the arbitration agreement or any person claiming through or under him, so applies not later than the date of submitting his first statement of claim on the substance of the dispute, and notwithstanding anyjudgment, decree or order of the superior court, refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists' Also, in Alchemy Resources Ltd (supra), this Court speaking through ... cemented the above position, I quote, 'As there is a valid arbitration agreement between the parties, the duty of this court now is holding the parties to their bargain by ordering specific performance of their agreement. I thus refer the present dispute arising from the Purchase Contract dated 23rd January 2023, to be resolved by arbitration under the London Court of International Arbitration with the place ofArbitration being in London, England. This is what the parties agreed in their contract' 5 Herein there is no argument forthcoming vindicating that no valid arbitration agreement exists between the parties. As such parties herein are bound by the submission clause. It is to be noted that, in terms of the provision of section 13(1) and (2), Cap 15 (supra), an application

of this nature can be made notwithstanding a fact matter is to be referred to arbitration after the exhaustion of other dispute resolution procedures. For brevity, I reproduce section 13(1) and (2), cap 15 (supra), '(1) A party to an arbitration agreement against whom legal proceedings are brought, whether byway of claim-. or counterciaim in respect ofa matter which under the agreement is to be referred to arbitration may, upon notice to the other party to the proceedings, appiy to the court in which the proceedings have been brought to stay the proceedings so far as they concern that matter. [Emphasis mine] (2) An application under subsection (1) may be made notwithstanding that the matter is to be referred to arbitration after the exhaustion of other dispute resolution procedures' Therefore, a mere fact clause seven of the sale agreement, annexure Al to the affidavit, requires that any dispute between the parties to be resolved amicably, on itself is not an impediment for parties to make a submission to the arbitrator. 6 In her argument, the Applicant was stressing that by having an arbitration clause in a contract annexure Al to the affidavit, on itself it oust the jurisdiction of this Court. However, this answer to this argument is found in the decision which cited by the Applicant self, in the case of Alchemy Resources Ltd (supra), this Court made it dear on this subject,

I quote, 'Does existence an arbitration Clause oust the jurisdiction ofthe court? My answer is in the negative. The Arbitration Act, CAP 15 (R.E 2020) is very dear on this under section 14. Where there is a valid arbitration agreement on the matter which has been filed in court, the Court should simply refer the parties and the matter in dispute to arbitration. This presupposes that the court hasjurisdiction over the same matter but that the parties' agreement is thereby being respected. If the Court had no jurisdiction over the matter subject of arbitration agreement, the Court would not then have the power to even pass an order to refer the matter to arbitration. The court would simply dismiss a matter over which it had no jurisdiction' Having adumbrated as above, I make an order staying the proceedings in Land Case No. 22260 of 2024 between Leonardo Rigoni vs Hudaa Nassor Salum, to pave a way for compliance to the terms of the contract by parties making submission to the arbitration. The stay will last for six months, til! 18/07/2025 7 at 11.00 hours, if there will be no cal! from the parties, the matter will automatically be removed in the active Registry, awaiting a call from them. The application is granted. No order as to costs. 8