JUDGEMENT WISTON VS KCB BANK

IN THE HIGH COURT OF UNITED REPUBLIC OF TANZANIA DAR ES SALAAM SUB REGISTRY. AT DAR ES SALAAM CIVIL APPEAL NO. 192 OF 2023 Appeal from the decision (Judgment and Decree) of the District Court of Kinondoni at Kinondoni in Civil Case No 162 of 2022 Hon. A. M. Lyamuya PRM dated 02nd August, 2023. KCB BANK TANZANIA LIMITED ............................................1ST APPELLANT NKAYA COMPANY LIMITED…………………………………….….2ND APPELLANT VERSUS WINSTON CHURCHIL KATWAZA ……….…………………………. RESPONDENT JUDGMENT: 26th June & 24th July 2024 KIREKIANO, J.; In the District Court of Kinondoni, the respondent herein filed a suit against the appellants claiming the following reliefs: an order of repayment of the purchase price of Tsh 145,000,000 general damages, cost and other relief deemed just by the court. The respondent's claims emanated from the public auction conducted by the second respondent at the instruction of the first respondent. The auction involved the sale of the property on plot 517 CT 114770 located in the Jangwani Beach area. It is common ground that 1 the respondent emerged as a successful bidder in the said auction. On 1/10/2016, he paid Tshs 145,000,000 and was issued a certificate of Sale. The respondent thus attempted to transfer the property to his name. This was not successful; he was told by the land office that there was a pending land case No. 327/2014 in the high court involving the first appellant and former owner. It is noted here that the property was auctioned after the owner failed to service the loan for which the house was used as collateral. Following the failed attempt to transfer the property into his name, the respondent lost interest in it. Since then, he has unsuccessfully claimed a refund of the purchase price from the appellants. In his sworn testimony before the trial court, respondent PW1 Churchill tendered the certificate of sale Exhibit P1 in which he paid the claimed amount. He told the trial court that from 2016, he demanded the defendant, now the appellant, refund his money with interest, but this was not successful. He said the respondent did not disclose to him that there was a case involving the said property. He was not a part of case no. 326/2014, in which the defendants, now the appellant, later lodged a notice of appeal in the court of appeal. 2 On their part, the appellant's case was made by one witness, Hamisi Kibwana Gamba. In his testimony, he narrated the background of the respondent's claims. He tendered loan facility (Exh D-1) in respect of Coral corn General Supplies Ltd dated 11/7/2011 to the effect that the suit property was security in terms of the contract for guarantee (Exhibit D-2) dated 12/12/2011 signed by the directors of the borrower Robert Movo and John Bisendo. Following this facility, Mkami Gaitan Sunyungu, administrator of the Estate of Eliza Gaitan Sunyungu, filed a case, land No. 327/2014. In this case, the high court nullified the guarantee agreements because the guarantee was made by a person of unsound mind (Exh DE-4). The appellants were dissatisfied with this decision. According to Exh DE- 5, the appellant contacted the high court to be supplied with the necessary documents for appeal and lodged a notice of appeal. He could not name the number of appeals. It was the appellant's case that the respondent was aware of land case no. 327/2014; thus, the respondent should await the final determination of the appeal in the court of appeal. When cross- examined on the interest on the paid sum, he said, according to the facility Exhibit DE1, the interest was 23% per annum. 3 The trial court framed two issues: whether the respondent was entitled to a refund or payment of the purchase price and what reliefs the parties were entitled to. The trial court thus found that the plaintiff's claims were proved to the required standard. The District Court reasoned that if the bank could not wait for seven years to be paid the loan and decided to auction the collateral, what then would make the plaintiff ( respondent) wait for seven years to be refunded back, it thus adjudged dispute in favour of the respondent and ordered the appellant to repay Tshs 145,000,000, interest at 17% from date of payment of purchases price 1/10/2016 till date of the judgment 2/8/2023 interest at court rate at 7%, and general damages 75,000,000 and costs. Dissatisfied with this decision, the appellant preferred this appeal with five grounds thus; 1. The Trial Principal Resident Magistrate erred in law and fact by failing to appreciate that since there is a pending Appeal in the Court of Appeal commenced by the filing of Notice of Appeal by the 1st Appellant dated 9th January 2019 (Exhibit-D-5) and which concerns suit property on Plot No. 517 and comprised on CT N.l 14770 Jangwani Beach Area which is also the cause of action in Civil Case No. 162/2022; the suit was thus prematurely preferred in the circumstance. 2. The Trial Principal Resident Magistrate erred in law and facts for failure to properly evaluate both oral and 4 documentary evidence tendered by PW-1 and DW-1 respectively. 3. The Trial Principal Resident Magistrate relied on Section 16 of the Fair Competition Act, which is inapplicable in the determination of the suit—Civil Case 162/2022—and was inappropriately applied. 4. The Trial Principal Resident Magistrate erred in law and fact by disregarding the legal principle applied in the case of Magoiga Nyankorogo Mriri vs. Chacha Moroso Saire— Civil Appeal No. 464 of 2020, CAT - Musoma (unreported). The subject decision is relevant and binding in determining Civil Case 162/2022. 5. The Trial Principal Resident Magistrate erred in law and fact by awarding general damages to the Respondent of Tshs75,000,000/= in contravention of law without any legal justification. When this appeal was placed before me for hearing, the appellant had Miss Regina Kiumba's services. Mr Walter Shayo, a learned advocate, represented the respondent. Submitting on the grounds of appeal, on the first ground, Miss Kiumba argued the suit was filed prematurely because the appellant was actively pursuing justice in land case no 327/2014; this was according to the notice of appeal filed exhibit DE—5. According to her, although the parties are different, the outcome of the intended appeal is directly connected to the fate of the appellant's claims; thus, he had to wait. 5 On the second ground, Miss Kiumba faulted the trial court's evaluation of evidence PW1 and DW1 regarding the fact that the suit property was sold at auction. The respondent knew the property was sold at auction, but he failed to transfer it from 2016 until 2020 when he initiated the proceedings. The respondent knew there was a pending suit and did not conduct any due diligence before purchasing the property. On the third ground, section 16 of the FCC Act relied on by the Principal Resident Magistrate was inapplicable in determining the suit subject of appeal. The same promotes and protects effective competition in trade and commerce, protects consumers from unfair and misleading market conduct and provides for other related matters. Miss Kirumba submitted that the same is not applicable in this appeal. On the fourth ground, she argued that the respondent knew that the suit property was the subject of a suit in 2016 and waited until 2020 for a refund. The four years lapsed would have been a genuine refund issue had he acted diligently and noticed the incumbrance. In this she cited Magoiga Nyankorongo Mriri vs Chacha Mroso Saire (Civil Appeal 464 of 2020) [2022] TZCA 343 (14 June 2022) on page 13 to the effect that, if a party having a right stand by and sees another dealing with the property in a manner inconsistent with that property, and does not object while the act was in progress, he cannot afterwards 6 be heard to complain about it. She said the trial court erred in disregarding this principle. On the fifth ground, Miss Kiumba submitted that the award of general damage of Tshs 75million was in error since no proof was tendered on the damage suffered; there was contributory negligence on the part of the respondent; thus, the amount of damage ought to be reduced. She cited the case of General Manager African Barrick Gold Mine Ltd. vs Chacha Kiguha and 5 Others (Civil Appeal No. 99 of 2019) [2024] TZCA 469 (14 June 2024). Mr. Walter Shayo, for the respondent, responded on the first ground that, unlike the appellant, the respondent knew about the pending case after purchasing the property, but he proceeded to conduct an auction while the case was pending. It is on record that the respondent testified about due diligence, and the property was free of incumbrance. On the second ground, pending case knowledge is refuted as he was not a party to that case. The auction was done on 01/10/2016 when he approached the appellant, but the appellant advised him to await the determination of the land case (exhibit D—4). On the third ground, applying section 16 of the Fair Competition Act did not impact or injustice the appellant. On the fourth ground, Mr. Shayo 7 argued, there was an attempt to transfer the same, and it was found to be involved in a land dispute, which was determined in 2018. From there, a follow-up was done; thus, the cited case of Magoiga is irrelevant since the respondent had done several follow-ups with the first appellant. On the last ground, general damages, he prayed that the case of Peter Kilibika be distinguished and left to the court's discretion for analysis. We submit that the general damages were justifiable and proper. In her brief rejoinder, Miss Kiumba reiterated her submission in chief. She added that the discretion in damages should have considered the respondent's agreement to wait for the court of appeal's final decision. On my part, while I address the grounds of appeal, I am alive to that this is a first appeal; thus the court is entitled to look and evaluate the evidence afresh and, if necessary, come up with a decision, see Martha Weja V. Attorney General and Others (1982) Tlr 35. In the second ground of appeal, the appellant's complaint was regarding the evaluation of evidence. Looking at the pleadings and evidence on 8 record, there was no dispute that the suit property was sold under auction and that the first appellant was exercising her recovery right as per facility letter exhibit DE—1. While I consider this and the first issue as raised by the trial court, it was also noted that the first appellant decided to sell the property while they were involved in the land case challenging the disputed guarantee. According to evidence on record, there was no injunction restraining the disposition, and the respondent was not involved in the land case. Miss Kiumba faulted the trial court for refusing to apportion a burden to the respondent since he knew there was a pending suit and that he did not conduct any due diligence before purchasing the property. There was no injunction, and the respondent was not involved in the case. I agree with the trial court that when the chaos involved in the sale had to be weighed out, the respondent could not be on equal weight as the appellant. From the other angle, Miss Kiumba beseeched me to consider that the respondent should have been patiently waiting for the CAT determination of the appeal in the land case. This argument is also featured in the trial court pleadings, evidence, and judgment. I cannot agree with this submission, and I hasten to say it would have been 9 different if the respondent herein had joined in that land case. There can be no justification to preclude the respondent from suing to recover what he believed was his entitlement. On a fair basis, the patience ended its relevancy when the 1st appellant, aware of the disputed guarantee and a part in the land case, decided to auction the property. The way the first issue was crafted, I see nothing to fault the trial court's evaluation of evidence and arriving at the conclusion the way it did. On the first ground, the appellant argues that a pending appeal in the Court of Appeal commenced with the filing of a Notice of Appeal by the 1st Appellant dated 9 January 2019. According to the appellant counsel, the suit subject of this appeal was prematurely preferred. The respondent supported the trial court's reasoning when it ruled that the suit was not res sub judice. On my part, I have reconsidered the doctrine of res prejudice under section 8 of the Civil Procedure Code Cap 33, which was the basis of the trial court decision. The application of this doctrine is where necessary tests exist. This court, Ismail J, (as he then was), had the opportunity to elucidate the same in Ravji Construction Ltd vs Mohamed Enterprises (Tanzania) Ltd & Another (Civil Case 59 of 2022) [2022] TZHC 10 11684 (15 August 2022) These are: One, that there must be two suits, one previously instituted and the other subsequently instituted; two, Issues must be directly and substantially the same in both suits; three, the pending matters must involve the same parties; four, courts in which the issues are pending must be competent to grant the reliefs; and five, That the parties should be litigating under the same title. I have revisited the ruling of the trial court dated 10.10. 2022. The argument advanced at the trial court was on the presence of the notice of appeal dated 9.1.2019. It is undisputed that the notice intends to challenge the high court's decision in land case no 327 of 2014. This decision nullified the guarantee agreement concerning the suit property in the name of Elias Gaitan Sunyungu because the person who made the guarantee was ruled to be of unsound mind. The respondent herein did not participate in those proceedings, and his claims are different. I see no basis to fault the trial court's finding that the suit was not res sub judice. The third ground should not detain me; I have read the object of the act, the same promotes and protects effective competition in trade and commerce, protects consumers from unfair and misleading market conduct and provides for other related matters but also the issues before the trial court, 11 I have failed to grasp the relevance of the act's application in deciding whether a refund was justified or not. With respect to the learned Principal Resident Magistrate, the application of this act was misplaced. On the fourth ground, the appellant's counsel raised the defence of acquiescence. Acquiescence occurs when a person knowingly stands by, without raising any objection to, the infringement of his rights. The facts relied upon are that the respondent, having paid the purchase price in 2016, waited to institute the suit in 2022. I have traversed the respondent's claims in the plaint. It is shown in paragraphs 6 and 7, the that the respondent made claims to the appellant. It is also shown in the testimony of PW1 Churchill on page 9; thus, From 2016, I wrote many letters demanding my money and interest from KCB. My request has fallen on deaf ears, and I have not yet received my money back. The appellant partly admitted the contents of paragraph 7, which states that advocate KKB attorneys wrote one letter. In the defence by DW1, the appellant relied on the existence of the land case as the reason for the stalled transfer and, alternatively, the refund of the money. 12 I have reflected on Miss Kiumba's submission that the four years lapsed would have been a genuine refund issue had the respondent acted diligently and noticed the incumbrance. It is common ground that the appellant auctioned the property because there was no stop order. From the foregoing I am not convinced that the respondent stood by, instead of pursuing his right. In the cited case of Magoiga Chacha, the court of appeal clarified that the doctrine of acquiescence arises from the common law principles of equity. It went on to decide that the doctrine was not applicable where the suit land was specifically given to the respondent by the appellant, and non-interference of the acts inconsistent with the agreement was not based on acquiescence but on the furtherance of friendship and undertaking between them. In this appeal going by equity, the appellant auctioned the collateral to the respondent, knowing that the validity of the guarantee was under court consideration. The appellant testified that there was no order restraining the sale. On equal weight, how did the appellant expect the buyer, in this case the respondent, to find more? It is evident from the evidence on record that the respondent's frustration started at the land office, where he learned 13 he could not have the property transferred to his name. There is thus nothing to suggest that he was at ease, and he allowed the appellants to enjoy his money or the purchased property at his detriment. All facts considered, in my assessment, the doctrine of acquiescence cannot be applicable here; the fourth ground is dismissed. On the last ground, which is the fifth ground on the amount of damages awarded, it is the law that general damages are meant to put the injured party or a person who has suffered damage in the same position he would have had he not suffered damage. There are several authorities to support his proposition, including P.M. Jonathan v. Athuman Khalfan [1980] TLR 190, Razia Jaffer Ali v. Ahmed Mohamed Ali Seweji and Others [2006] TLR 433 and Peter Joseph Kilibika & CRDB Bank public company Ltd V. Patrick Aloyce Mlingi (CAT) Civil Appeal No. 37 of 2009 . in Anthony Ngoo and Another v. Kitinda Kimaro, Civil Appeal No. 25 of 2014 (unreported), where the Court held that: "The law is settled that general damages are awarded by the trial judge after consideration and deliberation on the evidence able to justify the award. The judge has discretion in the award of general damages. However, the judge must assign reasons. 14 In assessing the general damage, the trial court considered that the money paid by the respondent to the appellants was substantial, and he did not ask much from the appellants; instead, he only asked for a refund, which was, in essence, his right. Then, it concluded that the plaintiff lost the usual enjoyment of his money. I have read the decision cited, the General Manager African Barrick Gold Mine Ltd. (Supra), which stated that contributory negligence is to be considered. With respect, I am of the view that this case is distinguishable in this appeal as the court dealt with the assessment of damages in a claim of tort arising out of negligence and held that where there is contributory negligence by a party, the amount of damages awardable to the party is to be reduced depending on the degree of his negligence. I have reviewed the appellant's pleadings; no aspect of negligence was pleaded and proved. Thus, I find the case distinguishable. As such, I am aware of the principle that the appellate court is always reluctant to interfere with a finding on damages, as seen in The Cooper Motor Corporation v. Moshi Arusha Occupational Health Services [1990] TLR 96. In this appeal, I have considered that the claim arose from a refund claim in the event of a failed land transfer and 15 not a pure breach of contract. No evidence was shown of how the respondent directly suffered a loss. I consider this case to fit an award on nominal damage. My conclusion is fortified by the decision by this court Makaramba, J (as he then was) in Amandus Ziky Masinde vs Nyamsera Marumba (HC Civil Appeal 88 of 2016) [2018] TZHC 2954 (24 April 2018) where he held; In the absence of evidence by the Plaintiff/Respondent to prove any loss naturally and directly flowing from the breach of the loan agreement and failure by the plaintiff to prove the actual amount of his loss, this was clearly a case for award of nominal damages. I have also considered Miss Kiumba's submission that the amount of damage ought to consider the respondent's agreement to wait for the court of appeal's final decision before he changed his mind and filed the suit. As such, I have considered the amount claimed was awarded interest before and after judgment. In all fairness, the award of 75 million, which was more than half of the claimed amount, was excessive and gave the impression of punishment that did not fit the case, all factors considered, given the above, the award of nominal damage of Tshs 5,000,000, as I hereby do, 16 would have served the justice of the case. The fifth ground is allowed to the extent indicated. In the end, save for the reduced amount of damages from 75,000,000 to Tsh 5,000,000, this appeal stands dismissed. The trial court decision is upheld, which is a refund of Tshs 145,000,000, interest at 17% from the date of payment of the purchase price 1/10/2016 till the date of the judgment of (the lower court) 2/8/2023, and interest on the decreed sum at 7% per annum from the date of judgement till fulfilment. The respondent shall have the costs. A. J. KIREKIANO JUDGE 24.7.2024 17 COURT: Judgment delivered in the chamber in the presence of Miss Regina Kiumba for the appellants also holding brief of Mr Walter Shayo for the respondent A. J. KIREKIANO JUDGE 24.7.2024 18