JALUMA

IN THE HIGH COURT OF UNITED REPUBLIC OF TANZANIA DAR ES SALAAM SUB REGISTRY AT DAR ES SALAAM CIVIL APPEAL N0. 11598 OF 2024 (Arising from the Judgment and decree of the Resident Magistrate’s Court of Dar es salaam at Kisutu, Civil Case No 48 of 2019 by Hon E.N KYARUZI -PRM dated 31st March 2023 JALUMA GENERAL SUPPLIES LIMITED………….1ST APPELLANT LUCAS PIUS MALLYA…………………………………2ND APPELLANT VERSUS BANK OF AFRICA (TANZANIA) LIMITED………...... RESPONDENT JUDGMENT MKWIZU,J: The appellants are discontented with the decision handed down by the Resident Magistrates’ Court of Dar es Salaam at Kisutu, presided over by Hon. Kyaruzi, PRM, in Civil Case No. 48 of 2019, dated March 31, 2023. With a firm resolve, they have chosen to appeal the entirety of this decision, seeking to challenge its findings and pursue justice on the following grounds 1. The trial court erred in law and facts by determining the suit without prerequisite pecuniary jurisdiction. 2. The trial court erred in law' and facts by determining the suit unfairly against the Appellants. 1 3. That the trial court erred in law and in facts by determining the dispute and granted relief against the Appellant to the Respondent and left the 2nd Appellant’s right undetermined. 4. The trial court erred in law and facts in improperly evaluating the evidence adduced on the record. 5. That the trial court erred in law and facts for not holding that the appellants proved the case on a balance of probability, unlike the Respondent in the main suit and in the counterclaim. The appeal was argued through written submissions. The Appellants were represented by Mr. Gidion Opanda, a learned advocate, while Mr. Laurent Mangée, a learned advocate, represented the Respondents. In support of the first ground of appeal, Mr. Opanda cited Halsbury’s Laws of England, Vol. 10, paragraph 314, which defines jurisdiction as the authority of a trial court to adjudicate matters brought before it or to consider specific matters prescribed for its determination within the scopes defined by the statute, charter, or commission under which the court operates. He restated a well-established principle in law that the issue of jurisdiction must be addressed prior to considering the substantive merits of a case citing the decision in Patrick William Magubo v. Lillian Peter Khali, Civil Appeal No. 41 of 2019, and The 2 Grand Alliance Ltd v. Mr. Wilfred Lucas Tarimo & 4 Others, Civil Application No. 229 of 2020, Court of Appeal of Tanzania at Dar es Salaam, where the Court of Appeal of Tanzania insisted on the duty of every court, before venturing into a determination of any matter before it, to first satisfy itself that it is vested with the requisite jurisdiction to do so. And that any decision by a court without jurisdiction remains a nullity Mr. Opanda asserted that the matter adjudicated in the trial court was indeed of a commercial nature, thus falling under the purview of Sections 2 and 40(3) of the Magistrate Court Act [CAP 11 RE. 2019] noting that the claim arose from a contractual relationship between the appellant and respondent concerning an outstanding loan facility, a claim for repayment of commercial debt and, therefore, a commercial dispute. To further substantiate his argument, he referred the court to the case of National Bank of Commerce Ltd v. Maisha Musa Uledi (Life Business Centre), Civil Appeal No. 501 of 2022 and Maduhu Sang’udi Investment v. Kasonzo Car Hire Company Limited, Civil Appeal No 148 of2021, Court of Appeal of Tanzania ( All unreported) urging the court to nullify the proceedings of the trial court per the dictate of the law. 3 In response to the first ground of appeal, the Respondent contended that the trial Court did not error in law or fact regarding its pecuniary jurisdiction. The Respondent argued that the same Appellants had willingly submitted to the trial Court's jurisdiction by instituting Civil Case No. 48 of 2019, which continued through to the final determination and therefore challenging the jurisdiction at this stage is an afterthought, as it should have been raised at the earliest opportunity or the Appellants could withdraw their suit and refile it as a commercial case in a court with appropriate jurisdiction. Thus, the Respondent maintained that the Appellants’ late challenge to jurisdiction is unsubstantiated. His contention is mainly that, the Appellants initiated the action as a civil case, which falls squarely within the purview of the court's jurisdiction. He refutes the Appellants' assertion that the trial court lacked pecuniary jurisdiction, characterizing this argument as an unwarranted afterthought devoid of merit. To him, the case was appropriately instituted and that the trial court possessed the requisite authority to adjudicate the matter. Since this grounds faults the jurisdiction of the trial court I find it pertinent to determine it first before moving to the rest of the grounds if need be. In this ground parties’ contentions are two, (i) whether the claim in plaint 4 at the trial court was a commercial dispute and (ii) whether the trial court had pecuniary jurisdiction to entertain the same. The Appellant's counsel argues in affirmation, while the respondent’s counsel argues against the issues. It is as well settled that jurisdiction is fundamentally a creature of statute; neither party nor the court can bestow jurisdiction upon a court that it does not rightfully possess. The rule has always been that courts are to ascertain its jurisdiction at the earliest possible opportunity as any decisions rendered by a court lacking the requisite authority are deemed nullities. This position was held by the Court of Appeal in the case of Fanuel Mantiri Ng'unda Vs Herman Mantiri Ng'unda & 20 Others, Civil Appeal No. 8 of 1995 (unreported) where it observed : "The question of jurisdiction for any court is basic, it goes to the very root of the authority of the court to adjudicate upon cases of different nature ... The question of jurisdiction is so fundam ental that courts m ust as a m atter of practice on the face of it be certain and assured of their jurisdictional position at the com m encem ent of the trial ... It is risky and unsafe for the court to proceed 5 with the trial of a case on the assumption that the court has jurisdiction to adjudicate upon the case." (Emphasis added) The Court of Appeal has established guidelines for determining the court's jurisdiction. This involves examining the nature of the claim presented, focusing on the facts pleaded in the plaint, while paying particular attention to the cause of action and the relief sought by the plaintiff. In the case of Meneia Mkuu, Shirika La Umeme Zanzibar vs Juma Simai Mkumbini & Others (Civil Appeal 41 of 2010) [20111 TZCA 127 (12 December 2011), the Court held: "Secondly, in determining the jurisdiction of a civil court the averments made in a plaint are material. In effect, this m eans that the jurisdiction of a court should norm ally be determ ined on the basis of the case put forw ard by the plaintiff in the plaint and not by the defendant in the written statement of defence." The guidance given above shows that, in the complaint, the court will depict the nature of the claims, in this case, whether a commercial dispute or a typical civil suit, and the cause of action taken. Guardedly, I have perused the plaint and the itemized reliefs. The facts revealed that in 2012, the 1st Appellant and the Respondent entered into 6 an overdraft facility agreement amounting to Tanzanian Shillings 390,000,000/=, secured by the 2nd Appellant's fundamental properties, specifically inclusive of Plot No. 1506/15, Block M, Forest Area, Mbeya City, having Certificate of Title No. 9375MB YLR, and Plot No. 200, Block P, Mtoni Tandika Area, Temeke District, Dar es Salaam, under Certificate of Title No. 59771. This facility was designated for distributing food and beverage products on wholesale and retail bases. The duration of the facility was stipulated to be twelve months. Subsequent to the grant of the facility, it appears that by the year 2017, the 1st Appellant failed to adhere to the terms and conditions outlined in the loan facility agreement, followed by the refusal by the respondent to restructure the loan facility in favour of the appellant prompting the filing of Civil Case No. 48 of 2019, initiated by the appellant, the borrower followed by a counterclaim by the defendant now respondent. The trial court’s decision ended in favour of the defendant, now the respondent; hence, this appeal is challenging, among other things, the trial court's jurisdiction. The important question at this juncture would be whether the facts disclosed by the complaint depict a commercial dispute or a normal civil suit. Luckily, the definition of a commercial dispute is statutorily established. Section 2 of Magistrate Courts Act, [Cap 11 R.E 2019] and 7 Rule 2 of the High Court Registries Rules, GN. No. 162 of 2003 defines a commercial case as: ’’a civil case involving a matter considered to be of commercial significance including but not limited to- (i) the formation of a business or commercial organizations; (ii) the governance of a business or commercial organization; (iii) the contractual relationship of business or commercial organization with other bodies or persons outside it; (iv) the liabilities of com m ercial or business persons arising out of that person com m ercial or business activities; (v) the liabilities of a commercial or business person arising out of that person commercial or business activities (vi) the restructuring or payment of commercial debts by or to business or commercial organization or person. (vii) the winding up or bankruptcy of a commercial or business organisation or person (viii) the enforcement of commercial arbitration award; 8 (ix) the enforcement of award of a regional court or tribunal of competent jurisdiction made in accordance with a treaty or mutual assistance arrangements to which the United Republic is a signatory and which forms part of the law of the United Republic; (x) Admiralty proceedings; (xi) Arbitration proceedings Collected from the above sections, a commercial case is classified as a civil case that holds commercial significance, meaning it must be directly related to the buying and selling of goods or services. See also: G.K. Hotels and Resort (Pty) Vs. Board of Trustee of the Local Authorities Pension Fund, Commercial Case No. 1 of 2008 (HC- unreported). Weighting the facts deposed in the plaint and the reliefs sought by the plaintiffs at the trial court with the above definition, I have no hesitation in concluding that the plaintiff's claim at the trial court was purely a commercial transaction falling within the ambit of a commercial case as defined by the law above. 9 There is no doubt that the trial court had jurisdiction to determine a commercial dispute; the only issue raised is that it lacked the necessary pecuniary jurisdiction over the presented commercial disputes. This brings us to section 40(3)(b) of the Magistrates' Courts Act, which stipulates the pecuniary limits of the Resident Magistrates' Court concerning commercial disputes. The section reads: (3) Notwithstanding subsection (2), the jurisdiction of the District Court shall, in relation to commercial cases, be limited- (b) in the proceedings where the subject matter is capable of being estimated at money value, to proceedings in w hich the value of the subject m atter does not ex ceed seventy m illion shillings. The section above limits the District Court's authority to hear commercial cases exclusively to those where the value of the subject matter can be quantified in monetary terms and does not exceed seventy million shillings. Paragraph 16 and item (c) of the section of the relief in the appellant's plaint submitted at the trial Courts peg the specific claims at TZS 100,000,000, which is far above the pecuniary limits set by the law. I am thus satisfied that the trial court entertained a commercial dispute with a 10 value beyond what is permitted by the law. As usual, the entire proceeding is a nullity and the resulting judgment and decree. The first ground is valid, Upon finding merit in this ground of appeal, I find it sufficient to resolve the appeal on this basis, rendering it unnecessary to consider the remaining grounds. Accordingly, the appeal is granted, and the judgment and decree of the trial court are hereby quashed. Parties may, if they so wish, file their respective claims in an appropriate forum, subject to the law of limitation. The respondent is to have her costs as usual. It is so ordered. DATED at DAR ES SALAAM, this 28th Day of February 2025 E. Y MKWIZU JUDGE 11