JEM'STRADERS & FINANCIAL SERVICES COMPANY LIMITED and Jacob Enock Mgimba vs Self Microfinance Fund (MFUKO FUND), Spytech and Security Supplies Ltd, and The Attorney General

THE JUDICIARY OF TANZANIA IN THE HIGH COURT OF UNITED REPUBLIC OF TANZANIA AT MBEYA MISCELLANEOUS LAND APPLICATION NO. 000016490 OF 2025 JEM'STRADERS &FINANCIAL SERVICES COMPANY LIMITED .............................. COMPLAINANT / APPELLANT / APPLICANT / PLAINTIFF JACOB ENOCK MGIMBA .............................. COMPLAINANT / APPELLANT / APPLICANT / PLAINTIFF VERSUS SELF MICROFINANCE FUND(MFUKO FUND) .............................. RESPONDENT / DEFENDANT SPYTECH AND SECURITY SUPPLIES LTD .............................. RESPONDENT / THE ATTORNEY GENERAL .............................. RESPONDENT / DEFENDANT DEFENDANT RULING KALUNDE, J This ruling resolves a preliminary objection on a point of law to the effect that the present application is incompetent and unmaintainable in law for contravening Order XXXVII, Rule 1 of the Civil Procedure Code [Cap. 33 R.E. 2023, [Hereinafter referred to as “the CPC”]. To appreciate the breadth of the objection, it is necessary to set out, albeit briefly, the background from which it arises. Page. 1 Through Land Case No. 16491 of 2025, the applicants, JEM’S Traders & Financial Services Company Limited and Jacob Enock Mgimba, sued the respondents, Self Microfinance Fund, Spytech and Security Supplies Ltd and the Attorney General. The main suit concerns several landed properties, including a surveyed property comprised in CTN No. 53979-MBYLR, Plot No. 15, Block “D”, Madibira Area, Mbarali District, Mbeya Region; an unsurveyed parcel situated at Mkunywa Village, Madibira Ward; a house erected on unsurveyed land at Mkunywa; and another property situated at Mkunywa and standing in the name of the first applicant. For purposes of this ruling I shall refer to those properties collectively as “the suit properties.” The applicants’ case, in substance, is that on 15 day of November 2023 the th first applicant obtained a loan facility from the first respondent, for which the suit properties belonging to the applicants were furnished as security. Thereafter, the first applicant advanced the funds to smallholders and peasants. However, some of the said smallholders and peasants allegedly failed to repay their respective loans within the agreed period. According to the pleadings, although the applicants claim to have continued remitting payments as collections were made, the first respondent demanded full repayment. As a result, on the 18 day of February 2025, the first th respondent instructed the second respondent to enter upon and attach the suit properties and issue a fourteen day notice in preparation to the sale of the said properties by public auction. The applicants contends further that the intended enforcement is contrary to the terms of the loan agreement and unlawful, particularly because the outstanding Page. 2 debt is said to be substantially lower than the estimated value of the suit properties. In view of the above averments, the applicants pray for, inter alia, a declaration that the first respondent breached the loan facility agreement; a permanent order restraining the respondents from interfering with the suit properties; a declaration that any sale, auction or intended sale thereof is illegal; general damages of TZS 50,000,000; costs of the suit; and any other relief which the Court may deem fit and just to grant. Together with the main suit, the applicants filed the present application seeking an order for maintenance of the status quo in respect of the suit properties pending determination of the suit. The application is predicated upon the provisions of section 2(3) of the Judicature and Application of Laws Act [Cap. 358 R.E. 2023], [Hereinafter referred to as “JALA”]. The application is also supported by an affidavit duly sworn by JACOB ENOCK MGIMBA, the second applicant and Managing Director of the first applicant. The first and third respondents filed a counter affidavit resisting the application. In addition, the first and third respondents filed a Notice of Preliminary objection as stated earlier. Parties agreed and leave was granted that the preliminary objection be canvassed by way of written submissions. The respondents’ submissions were drawn and filed by Ms. Edina Mwamlima, learned State Attorney. However, despite being present when the scheduling orders were made and being duly served, Mr. Philip Mwakilima, learned Advocate for the applicants, did not file reply submissions within the period prescribed by the court. In view of this, it is fair to say that the applicants did not, therefore, avail themselves of the opportunity afforded to them to Page. 3 respond to the objection. However, that omission does not relieve this court of its duty to satisfy itself that the objection is legally meritorious. The second respondent was similarly duly served but did not enter appearance. I will therefore proceed to determine the objection based on the material properly placed before the court. In support of the preliminary objection, Ms. Mwamlima advanced four principal arguments. Her first contention was that the application is incompetent and unmaintainable in law for offending Order XXXVII, Rule 1(b) of the CPC. She submitted that the first and third respondents are Government institutions or entities. To support this, Ms. Mwamlima argued that by virtue of section 26 of the Written Laws (Miscellaneous Amendment) Act, 2020, which amended section 16 of the Government Proceedings Act [Cap. 5 R.E. 2023] [Hereinafter referred to as “GPA”], the term “Government” extends to a local government authority. Thereafter, Ms. Mwamlima submitted that in terms of the proviso to Order XXXVII, Rule 1 an order for temporary injunction cannot issue as the respective section expressly precludes the grant of a temporary injunction against the Government. To bolster her argument, the learned state attorney cited the case of Mwanza City Council vs Alfred Wambura (Civil Appeal) [2022] TZHC 55 (27 January 2022) TanzLII, to support a proposition that temporary injunction cannot issue against the Government. The second limb of her submission was that an order for maintenance of the status quo is, in substance and effect, indistinguishable from a temporary injunction. On this aspect, Ms. Mwamlima argued that both remedies are preservatory and are intended to prevent the destruction, alienation, transfer or disposal of property pending final determination of the dispute. In support of this argument, she cited the Page. 4 decision of this court in the case of Overseas Infrastructure Alliance (India) vs DAWASA (Misc. Civil Application 237 of 2020) [2021] TZHC 9244 (2 December 2021) TanzLII where it was held that the court must look beyond the description assigned to the relief and consider its practical and legal effect. Thirdly, Ms. Mwamlima submitted that the statutory prohibition goes to the jurisdiction of the court. She contended that where the relief sought is one which the law expressly forbids the court from granting, the court lacks jurisdiction to entertain and determine the application. In support of that argument, the learned state counsel cited the case of Joseph Mwasege and 86 others vs Tanzania Agricultural Research Institute (TARI), Misc. Civil Application No. of 21851 of 2024 where it was held inter alia that an order for status quo, including status quo ante, produces an effect similar to a temporary injunction and is therefore unavailable against the Government. Further to that, the learned State Attorney challenged the applicants’ reliance on the provisions of section 2(3) of JALA. She argued that the provision is not an enabling provision for the institution of proceedings. according to the learned state attorney, the section merely permits recourse to a specific rule of common law, doctrine of equity or statute of general application in force in England on the reception date where local law is silent. Having said that, the learned state attorney submitted that since the CPC comprehensively regulates applications for temporary injunctive reliefs, recourse to section 2(3) of JALA was misconceived. To support this argument, she cited the case of Freeman Aikael Mbowe vs The Dar es salaam Regional Commissioner & 2 Others, Misc. Civil Application No. 9 of 2017 Page. 5 (unreported). Relying on the strength of the above submissions, Ms. Mwamlima urged the court to uphold the preliminary objection and strike out the application with costs. For my part, having considered the pleadings and submissions fronted by Ms. Mwamlima, I am satisfied that the central issue for determination is whether the present application is competent and maintainable in law. However, the resolution of the above broader issue turns upon three subsidiary questions, that is: first, whether the order sought for maintenance of the status quo is, in its substance and practical effect, equivalent to a temporary injunction; second, whether the first and third respondents fall within the legal conception of the Government or Government entities; and third, if those questions are answered in the affirmative, whether the application is barred by the proviso to Order XXXVII, Rule 1 of the CPC. I shall begin with the first subsidiary question. Upon a close reading of the supporting affidavit, I agree with Ms. Mwamlima that the order sought, though expressed as one for maintenance of the status quo, is in substance and practical effect a temporary injunction. It must be noted that the true character of interlocutory relief is not determined by the terminology employed in the chamber summons, but rather by the conduct it is intended to restrain and the legal consequence which would follow from its issuance. Therefore, a prudent court must look beyond the form of the prayer and ascertain its actual object and effect. In the instant application, the supporting affidavit discloses that the suit properties were furnished as security for the loan advanced by the first respondent. It Page. 6 is also clear that the first and second respondents have threatened to sell those properties by a public auction and to execute that intention, they issued a fourteen day notice of intention to auction. However, the notice was uplifted on the 2 day of nd July 2025. Nonetheless, the applicants are worried that the auction will proceed unless the court intervenes. In view of these averments, the applicants seek preservation of the suit properties pending determination of the main suit. They pleaded that the intended sale would deprive them of their means of survival and occasion irreparable loss. In practical terms, the order sought by the applicants would restrain the respondents from advertising, attaching, auctioning, transferring or otherwise deal with the suit properties during the pendency of the suit. In my considered view, those averments fall within the purview of Order XXXVII, Rule 1(a) of the CPC. In accordance with that provision, the court is empowered, where property in dispute is in danger of being wasted, damaged, alienated or sold, to restrain the threatened act or make such other preservatory order as may be necessary pending disposal of the suit. I am aware that an order maintenance of the status quo may not in every case be synonymous with a temporary injunction. However, the position is different where, as here, the order is specifically intended to arrest an imminent sale and prevent a party from exercising a claimed power of disposal. In the circumstances such a s the present case, the order is prohibitory in operation and injunctive in effect. I therefore answer the first minor question in the affirmative. Accordingly, I hold that an order maintenance of the status quo is, notwithstanding its description, a temporary Page. 7 injunction within the contemplation of Order XXXVII, Rule 1 of the CPC. Having so found, the next question is whether the first and third respondents fall within the statutory conception of the Government or Government entities. Ms. Mwamlima submitted that, in accordance with section 17(5) of the GPA, the first and third respondents are Government entities and are therefore within the class of public bodies protected from temporary injunctive relief. For a proper appreciation of that argument an understanding of the provisions of section 17 of the GPA is relevant, specifically the relationship between section 17(3) and 17(5). Section 17(3) of the GPA provides: “Save as is provided in this section, an execution, attachment or similar process shall not be issued out of any court for enforcing payment by the Government of any money or costs referred to in this section, and a person shall not be individually liable under any order for payment of money or cost by the Government or any government department or any officer of the Government.” Section 17(5) of the same Act provides: “For the purposes of subsection (3), the word ‘Government’ shall include a Government, ministry, local government authority, independent department, executive agency, public corporation, parastatal organisation or a public company established under any written law to which the Government is a majority shareholder.” It is patently clear that, by its opening words, subsection (5) is expressly connected to subsection (3) and is not framed as a general definition applicable without qualification throughout the entire Act. Nevertheless, section 17(5) identifies Page. 8 a range of public institutions which the framers of the GPA recognises as forming part of the Government for purposes of protection from coercive judicial process. In my considered opinion, that categorisation is relevant in determining whether the first and third respondents to which the present interlocutory restraint is sought possess the character of Government entities. Now reverting to the facts of the present case, it is on record that the applicants themselves pleaded that the first respondent is a Government financial institution established under the Ministry of Finance of the United Republic of Tanzania. On the face of the pleadings, the first respondent is presented as part of the institutional framework of the Government and therefore falls within the extended meaning prescribed by section 17(5) of the GPA. Thus, viewed in light of the applicants’ own pleading, the first respondent bears the essential character of a parastatal organisation within the contemplation of section 17(5) of the GPA. It is a publicly established and State controlled financial institution whose functions are connected with the implementation of public economic and social policy. Accordingly, I am satisfied that the first respondent falls within the statutory notion of a Government entity under section 17(5) of the GPA. The position of the third respondent presents little difficulty. The Attorney General was joined pursuant to section 6 of the GPA in his representative capacity on behalf of the Government. He is not alleged to have independently issued the auction notice or undertaken the intended sale. His presence in the proceedings is representative, and an injunctive order directed against him in that capacity would, in substance, operate against the Government itself. That said, I answer the second Page. 9 minor question in the affirmative. I therefore hold that both the first and third respondents fall within the legal meaning of the term “Government” for purposes of this application. Having found that the order sought is, in substance and practical effect, a temporary injunction, and that the first and third respondents fall within the legal conception of the Government, I now turn to the third ancillary question, namely, whether the present application is barred by the proviso to Order XXXVII, Rule 1 of the CPC. The respective proviso stipulates that: “Provided that, an order granting a temporary injunction shall not be made against the Government, but the court may in lieu thereof make an order declaratory of the rights of the parties.” The language of the above proviso is mandatory. It denies from the court the power to grant a temporary injunction against the Government. In view of this provision, however substantial the apprehended injury may appear at the interlocutory stage, the court cannot issue an order restraining the Government from undertaking the impugned act. However, a careful reading of the respective section show that the law does not place Government action beyond judicial scrutiny. The section preserves the court’s power, in lieu of temporary injunction, to declare the rights of the parties in properly constituted proceedings. The rationale underlying this provision is apparent. Currently Government institutions discharge responsibilities concerned with the administration of the State apparatus and the provision of public and social services. Their operations ordinarily involve public resources, statutory programmes and obligations extending beyond Page. 10 the immediate parties to litigation. Therefore, an interlocutory restraint may impede the discharge of public functions and affect interests not represented in the proceedings. On the other hand, the preservation of declaratory relief ensures that Government actions remain subject to the law. This also means that an aggrieved person maintains access to courts for an authoritative determination of his or her rights. In the present case, the order sought is intended to restrain the realisation of securities by the first respondent. Since the first respondent is a Government entity and the third respondent represents the Government, the relief is directly captured by the statutory prohibition. I must also point out that I have not overlooked the position of the second respondent. It is on record that, the second respondent was duly served but he did not enter appearance. In accordance with the pleadings, the second respondent is a private auctioneer and debt-collection company. As a general argument, a temporary injunction may issue against such a party. However, his nonappearance, neither determines the application in favour of the applicants nor alters the substance of the relief sought. Having carefully read the affidavit, I have noted that it does not attribute to the second respondent any independent claim or decision separate from that of the first respondent. A carefully reading of the affidavit shows that its involvement arises solely from the instructions allegedly issued by the first respondent to attach and sell the suit properties in enforcement of the loan security. In my considered opinion, the second respondent is merely an instrument through which the first Page. 11 respondent intends to implement its decision to realise the securities. The thrust of the application is not to restrain an autonomous act undertaken by the second respondent on its own account. It is to prevent the first respondent’s intended enforcement action from being carried into effect. It is therefore plain that the reliefs sought is directed against the first respondent and, through the third respondent, against the Government. Thus, to grant the order against the second respondent alone would prevent it from carrying out the first respondent’s instructions and would thereby indirectly restrain the Government entity from exercising the impugned power of sale. In the circumstances, the prayer against the second respondent is not severable from the relief sought against the first respondent. The statutory bar stated above, therefore, applies to the application in its entirety. I therefore agree with Ms. Mwamlima that the present application is incompetent and unmaintainable in law. as I have pointed out above the order for maintenance of the status quo is in substance a temporary injunction. The said order is intended to prevent the first respondent, acting through the second respondent, from proceeding with the attachment and sale of the suit properties. Since, I have held that, the first respondent is a Government financial institution, and the third respondent is joined in his representative capacity, the relief is prohibited by the proviso to Order XXXVII, Rule 1 of the CPC. For the foregoing reasons, I find it unnecessary to determine Ms. Mwamlima’s alternative argument that the present application is incompetent because section 2(3) of JALA was improperly invoked as its enabling provision. I gather that the resolve to that question would not alter the outcome of the preliminary objection. Page. 12 In the result, the preliminary objection is upheld. The application is struck out for being incompetent and unmaintainable in law. Costs shall be in the cause. DATED at MBEYA this 10 TH day of JULY 2026. Dated at MBEYA this 1st of September 2026 . S. M KALUNDE JUDGE OF THE HIGH COURT Page. 13