CIVIL APPEAL NO 307 OF 2019 KIBO CORRIDOR LIMITED VS RAVJI INVESTMENT COMPANY LIMITED

IN THE COURT OF APPEAL OF TANZANIA AT MOSHI fCORAM: NDIKA. J.A.. GALEBA, J.A.. And MGONYA. J J U CIVIL APPEAL NO. 307 OF 2019 KIBO CORRIDOR LIMITED........................................ .....................APPELLANT VERSUS RAVJI INVESTMENTS COMPANY LIMITED .............................RESPONDENT (Appeal from the Decision of the High Court of Tanzania at Moshi) (Sumari, J.^ dated the 5th day of November, 2018 in Land Case No. 9 of 2017 JUDGMENT OF THE COURT 27th May & 13th June; 2024 GALEBA. J.A.: This appeal emanates from a business relationship that prematurely fell apart between a land lord and her tenant. The central axis of the appeal is the interpretation of, and compliance with a commercial Long-Term Lease (exhibit P3 or the lease) dated 1st April, 2015. By that lease, Ravji Investments Company Limited, the respondent, leased out six floors of Kibo Tower Building (the leased premises) to Kibo Corridor Limited, the appellant. The leased space, was from the 4th to the 9th floor of the leased premises which is located along Rindi Lane in Moshi Municipality. The two outstanding i features of the lease which are also key to the appeal, were that, the leased premises were to be upgraded and modernized to a three-star hotel standard. The said remodeling of the premises would be implemented by the appellant from her own financial resources, but would be progressively amortized against rent as it would be falling due. The second salient feature and critical to this appeal, is that the respondent covenanted with the appellant that she would provide a functioning elevator in the leased premises for the exclusive use of the appellant, and in case of any mechanical malfunction, the respondent would remedy the defect immediately upon notice from the appellant. Other lease terms that are pertinent to the present appeal were that; first, the term of the lease was ten years renewable from 1st April, 2015, at a monthly rent of US$ 7,000.00, payable three monthly in advance, but then the appellant would retain 40% of the relevant payment and apply it to amortize the renovation costs. Second, payment of rent for the premises, was suspended for 6 months between 1st April, to 30th September, 2015, essentially because, the premises were being let before the same was ready for effective commercial occupation. Third, under the lease, the respondent 2 was responsible to ensure availability of a standby generator, in case of power outage. With that brief background highlighting the most contested lease covenants, it is opportune now to point out a few material facts underlying the dispute that led to lodging of this appeal. According to the appellant, she carried out the renovations quite in compliance with the lease, and managed to book guests for consumption of the hotel services on 26th February, 2016, which was also, the inauguration day of the business. Unfortunately, the elevator did not perform as expected; it failed to lift guests and their luggage to their rooms and other amenities in the floors leased to the appellant. The standby generator too, had issues; its capacity to generate electricity to run the building and to operate the elevator was impaired, for it did not have an automatic changeover switch. Consequent to what happened, the guests in the hotel were frustrated and following the disappointment, some left the hotel the same night, and those who remained, left the next morning. The malfunction of the lift was communicated to the respondent, first orally immediately after 26th February, 2016, but as she did not respond, the appellant did so in writing on 6th April, 2016, 9th May, 2016 and 30th August, 2016 in terms of the letters of those dates (exhibits D6 and D7). According 3 to the appellant, the respondent neither sent any engineers or technicians to rectify the mechanical defect in the lift, nor did she provide a proper automatic generator. Instead, the respondent continued to press for payment of rent from July 2016, which the appellant refused to pay until Land Case No. 9 of 2017 was filed in March, 2017 for recovery of the rent withheld. As per the appellant, her failure to pay rent, was resultant of the respondent's own breach of the lease by failure to install a functioning elevator and an automatic genset, fit for the purpose. That was the case as put forth by the appellant before the High Court, in brief. On the other hand, the respondent's case was that there was nothing like default on her part on any aspect of the lease. Her strongest point was that the appellant took possession of the leased premises, enjoyed it but for no reason defaulted to pay rent. The other allegation of the respondent was that the appellant breached clause 5 of the lease by failing to avail to her in time, the expenses that were incurred in the renovation. The appellant's expenses (TZS. 704,812,373.00), according to Karol Joseph Uisso (PW1), at page 971 of the record of appeal, was delivered to the respondent on 20th October, 2016 instead of delivering it to her on 1st October, 2015. According to the respondent, as the appellant refused to pay rent without justification, on 17th March, 2017, she instituted Land Case No. 9 of 2017 in the District Registry of the High Court at Moshi, praying for various reliefs including recovery of rent arrears of US$37,800 equivalent to TZS. 84.294.000.00. In her written statement of defence, the appellant disputed the respondent's allegations and the reliefs sought, but did not end there; she put up the case narrated in the above brief facts by way of a counter claim among other reliefs; first, demanding for a declaration that the respondent was in breach of the lease and; second, seeking a refund of TZS. 704,812,373.00 being the funds spent on the renovation carried out in the leased premises. The case was duly heard, where the respondent presented one witness and relied on five exhibits, whereas the appellant in defence and in prosecution of the counter claim, relied on four witnesses and thirteen exhibits. At the end of the trial, the High Court granted the following reliefs in favor of the respondent; first, payment of US$ 37,800 equivalent to TZS. 84.294.000.00 being rent arrears of up to 31st March, 2017; second, payment of rent from 1st April, 2017 up to the date of handing over of the property to the respondent; third, interest at 7% per annum on the decreed 5 sums; fourth, an order that the appellant be evicted from the leased premises and; lastly, costs of the case. On the other hand, the counter claim was entirely dismissed, which decision aggrieved the appellant hence this appeal in which she raised the following 10 grounds of appeal to challenge it, namely: "i. That, the High Court erred in iaw and in fact in hoiding that the tim e fo r renovations, installation and equipping was iim ited to six months and ignored the fact which necessitated extension o f time. 2. That, the High Court erred in iaw and in fact by holding that it was the duty o f the defendant in the main su it to conduct inspection, the condition which was not agreed in Exhibit P3. 3. That, the High Court erred in law and in fact by holding that the defendant in the main su it failed to fu lfil the condition set in paragraph 4 o f the p arties' agreement, Exhibit P3. 4. That, the High Court erred in law and fact by holding that the P la in tiff in the counter claim failed to prove the costs fo r renovations, installation and equipping by producing genuine receipts while the original and genuine receipts were produced to the satisfactions o f the law. 6 5. That, the High Court erred in law and in fact by holding that the P la in tiff in the counter claim was not entitled to costs for renovations, installation and equipping amounting to TZS, 704,167,265.00/=, while the same was proved to the required standard in c iv il cases, 6. That, the High Court erred in law and in fact by holding that the P la in tiff is entitled to a total sum o f U5$ 37,800 equivalent to TZS. 84,294,000/= while the same was not proved to the standard required in c iv il cases, and the defendant in the m ain su it was not enjoying the su it prem ises for the purposes for which it was hired. 7. That, the High Court erred in law and in fact fo r its failure to evaluate the evidence before it, hence arriving a t an erroneous decision. 8. That the High Court erred in law and in fact for basing its decision on the contradictory evidence given by the Respondent herein during the trial. 9. That, the tria l court erred in law and in fact in proceeding to hear Land Case No. 9 o f 2017 in contravention o f the m andatory requirem ent o f Rule 5F o f the High Court Registries (Amendment) Rules o f2001, G.N. No. 63 o f2001 m aking the court to be without jurisdiction and whole o f the Proceedings, Judgm ent and Decree to be n u ll and void ab initio. i 10. That the tria l court erred in Jaw and in fact in proceeding with the hearing o f Land Case No. 9 o f 2017, while it was not w ell constituted w ithout aid o f assessors." Both parties filed written submissions in compliance with the applicable rules in two sets. The appellant filed written submissions in respect of all the grounds of appeal except the eighth. The respondent responded accordingly. At the hearing of the appeal, the appellant was represented by Mr. Gwakisa Kakusulo Sambo, learned advocate and the respondent had the services of Mr. Engelberth Boniphace also learned advocate. Both counsel, adopted their written submissions, and took advantage of orally submitting generally on the appeal but finally, they implored us to consider their written submissions as supplemented orally. As the nineth and tenth grounds are challenging the jurisdiction of the High Court, we will start with them. From the contending submissions on behalf of the parties, the issue posing for our determination in the ninth and the tenth grounds of appeal, is whether the Judge who tried Land Case No. 9 of 2017, needed to sit with two assessors or not. We will approach resolution of these two grounds, in a historical context of at least 25 years, that is from around the year 1999 and at the start of the millennium, with a narrow perspective focusing on the 8 jurisdiction of the High Court in (and matters with special attention to that court's composition. In 1999, the Land Ordinance, Cap 113 which had been enacted in 1923, along with many other pieces of legislations having a bearing on land, were repealed. The Ordinance was replaced by the Land Act, Cap 113 (the Land Act) which was enacted to regulate all issues pertaining to land, except land in the country side also called village land. There was also enacted the Village Land Act, Cap 114, which was particularly enacted to regulate land tenure in rural Mainland Tanzania. Part XIII of the Land Act is about land Dispute Resolution. Originally section 167 (1) (b) of the Land Act, at its enactment in 1999, was to the following effect: "167-(1) The follow ing courts are hereby vested with exclusive jurisdiction ; subject to the provisions o f this Part, to hear and determ ine a ii manner o f disputes, actions and proceedings concerning land, that is to say- (a) the Court o f Appeal; (b ) th e La n d D iv isio n o f th e H ig h C o u rt e sta b lish e d in accord an ce w ith th e la w fo r th e tim e b e in g in fo rce fo r e sta b lish in g c o u rt d iv is io n s ; 9 (c) The D istrict Land and Housing Tribunal; (d) Ward Tribunais; (e) Village Land Council. "[Emphasis added] The above provision of the Land Act was in keeping with section 3 (2) (d) of the Land Disputes Courts Act, Cap 216 (the LDCA) mirroring the exclusive jurisdiction of the Land Division of the High Court in land matters. A close scrutiny of the above section 167 (1) (b) of the Land Act, states that the Land Division of the High Court would be established, through a separate legal legislation process, and that is what followed, in 2001. On 5th April, 2001, the Land Division of the High Court was established and its composition was also pronounced by amending the High Court Registries Rules of 1984. Rules 5E and 5F of the High Court Registries (Amendment) Rules 2001, G.N. No. 63 of 2001 (G.N. No. 63 of 2001), provided as follows in respect of the establishment and composition of that Division in the High Court, respectively: "5 E There sh a ll be a land division o f the High Court within the Registry a t Dar es Salaam and a t any other registry o r sub-registry as m ay be determ ined by the Chief Justice in which, subject to the provisions o f any relevant law, appellate proceedings or original proceedings concerning land m ay be instituted. 5F. The Land Division o f the High Court sh all be properly constituted when presided over by a Judge sitting with two assessors," Relevant to the two grounds of appeal is that, from 5th April, 2001 a High Court Judge sitting in the land division had to sit with two assessors and had no option, otherwise the court would not be properly constituted. That was not all. In 2005, in respect of the issues of assessors in the land division, the High Court Registries Rules of 1984 were further amended twice. The first time was on 15th April, 2005 when the High Court Registries (Amendment) Rules of 2005 G.N. No. 96 of 2005 (G.N. No. 96 of 2005) was enacted and, the second amendment was on 11th November, 2005, when the High Court Registries (Amendment) Rules of 2005, G.N. No. 364 of 2005 (G.N. No. 364 of 2005), were promulgated. In what seems to have been unusual, G.N. No. 96 of 2005 reenacted rules 5E establishing the Land Division and 5F restating its composition. Rules 5E and 5F of G.N. No. 96 of 2005 are an exact replica of the above contents of rules 5E and 5F of G.N. No. 63 of 2001 quoted above. ii In both of the above rules, participation of assessors was mandatory, but we must underline here, that the rules were only applicable in the Land Division. Even then participation of assessors was mandatory until 11th November, 2005 when G.N. No. 364 of 2005 was enacted, revoking and replacing rule 5F in G.N. No. 96 of 2005 as follows: "5F (1). Except where both parties agree otherwise, the tria i o f a su it in the Land Division o f the High Court shaii be with the aid o f two assessors. (2) Where in the course o f the trial, one or more o f the assessors is absent, the court may proceed and conclude the tria l with the rem aining assessor or assessors as the case m ay be. " This rule gave option to parties who could need participation of assessors to have them in the court's composition, but if they did not, then a Judge of the High Court sitting alone would do. Of course, the above quoted rule subsisted up to 15th September, 2023, when the High Court Registries (Amendment) Rules 2023, G.N. No. 665 of 2023 (G.N. No. 665 of 2023), were enacted, deleting rule 5F from the G.N. No. 96 of 2005. However, the fate of G.N. No. 63 of 2001 was not covered in the latter subsidiary legislation. 12 In the year 2010, following a relatively huge case burden on the land division of the High Court, though it was not disestablished, the land division was stripped off of its exclusivity in handling land matters going to the High Court. On 28th January, 2010 the Parliament enacted the Written Laws (Miscellaneous Amendments) Act, No. 2 of 2010, which received a Presidential assent on 17th March, 2010. By section 2 of that Act, the phrase "the Land Division o f the High Court established in accordance with the law fo r the tim e being in force for establishing court divisions; in section 167 (1) (b) of the Land Act, was replace by the phrase " High C ourt" The same Act amended also the LDCA to reflect the same change. That meant that, all High Court Registries had jurisdiction to handle land disputes as was the High Court Land Division. The point we wish to underscore here is that, the High Court Registries were not bound to apply the procedures enacted for the High Court Land Division, one of which, being a requirement to sit with assessors. In our view, at this point the land division of the High Court could continue with resolving disputes as per the above cited GNs, but the High Court in other Registries would treat a land dispute as a normal civil matter and deal with it in accordance with normal rules of procedure applicable for trials in normal civil cases. 13 It is significant to highlight that the High Court of Tanzania, is in essence a creation of the Constitution of the United Republic of Tanzania (the Constitution), and its jurisdiction may only be traced from the same Constitution and some other laws, in terms of article 108 (1) of the Constitution. In view of the above discussion, we do not see how could issues of assessors would have arisen, whether mandatory or optional in the normal civil registry of the High Court, not being a land division. That is so because, the case from which this appeal proceeds, was filed in the District Registry of the High Court at Moshi. Luckily, this is not the first time that this Court is encountering the same problem. It encountered the same issue in the case of Oscar Karsan Kanji v. Abdallah Hassan, Civil Appeal No. 9 of 2020 (unreported). Faced with a similar quagmire, we observed as follows: "That is to say, the prerequisite o f land disputes being tried with the aid o f assessors unless the parties agree otherwise, envisaged by the High Court Registries (Amendment) Rules, 2005, did apply to the Land D ivision o f the High Court, not the High Court established by article 108 o f the Constitution o f the United Republic o f Tanzania, 1977 which was, as already 14 alluded to above, clothed with hearing and determ ining land disputes by the amendments to the Land Disputes Courts A ct vide the W ritten Laws (M iscellaneous Amendments) Act, 2010, This is to say, it seem s to us, the tria l court, not being a Land Division o f the High Court, was not under any legal obligation to ask the partes about the involvem ent o f assessors in the tria l o f the su it the subject o f this appeal." See also this Court's decision in Onaukiro Anandumi Ulomi v. Standard Oil Company Limited and Three Others, Civil Appeal No. 252 of 2020 (unreported). That said, as Land Case No. 9 of 2017 was filed in the High Court Registry and not the land division, issues of assessors could not arise in the proceedings before the court. Thus, the ninth and tenth grounds of appeal have no merit and we dismiss them. As the issue of jurisdiction has been disposed of, we will now proceed to the substance of the appeal starting with the first ground of appeal. In respect of this ground, Mr. Sambo's crosscutting argument was that the trial court erred in holding that, the period for renovation was fixed at six months by the lease. He argued that the business of hotel and hospitality industry 15 entails constant renovation and continuous state of repair of the facility, which activity cannot be limited by agreement. In any event, the learned counsel contended, that the appellant was fully paid for the rent up to 30th June, 2016. Such that whether renovation was completed within six months or thereafter, that had nothing to do with the landlord for her right was rent, which was paid. On his part, Mr. Boniphace referred us to clauses 4 and 7 of the lease and impressed on us to hold that renovations, installations and equipping up to the status of the three-star hotel was limited to six months. Had the appellant needed an extension, he added, she ought to have sought it from the respondent under clause 11 (b) of the lease. The question we need to answer in resolving the first ground of appeal is whether there was a strict time limit for carrying out the renovations in the lease. Our starting point will be the very disputed clauses 4 and 7 of the lease, which provide as follows: "4. The Lessee sh all ren o vatefu rn ish and equip the dem ised prem ises to su it the purpose to which it is rented to w it a three-star hotel, tourist business and 16 office partitions and sh all charge this cost on the account o f the Lessor. 7. On the basis o f this agreem ent the parties have agreed a grace period o f six months fo r renovation, installation and equipping the appointed floors o f the dem ised prem ises to su it the purpose for which the prem ises are rented to w it a three-star hotel. The grace period sh all not be a subject for re n t" Going through clause 4, there is no time frame for doing anything in that clause, so we cannot get anywhere with it. We will consider clause 7. The latter clause (clause seven), provides for six months grace period. During that period, the appellant's payment of rent was suspended; obviously because, the leased premises was leased out at the time when, it was not yet fit for the purpose. See clause 7 above. The structure needed renovation and installation of various equipment. In our view therefore, a grace period is a specific duration in which a given obligation, such as making a payment or performance of a duty, is suspended or delayed without any contemplation of penal or adverse consequences on the part of the person granted that advantage; the grace period. In the context of the lease under review, the respondent was forced to grant a grace period to the appellant and agreed to suspend or forego payment of rent to her, because she was leasing out an unfinished and unfurnished construction. That is to say, had the leased premises been upgraded and modernized to the three-star hotel standard, at the time of execution of the lease, the issue of renovation and therefore, a need to grant the grace period could not have been part of the lease. Renovations and installations had to be made part of the lease because the respondent had not upgraded the leased premises to the standard necessary for the appellant's business. The grace period was necessary to be granted, in order to cushion or absolve the respondent's omission to have fully furnished ready to run three-star hotel, that the appellant desired to hire. In the circumstances, no fair or just system of law can permit a person in the position of the respondent, to benefit from the provisions of clause 7 of the lease, even if we were to agree with her that the appellant did not complete the renovations and the installations within that time. Putting it the simpler way, the respondent cannot legally be allowed, to benefit from, a fallout caused by her own omission. In any event, where the position of the appellant was that they carried out the renovations and installations as per 18 the lease, the only witness for the respondent, PW1 at page 969 of the record of appeal, told the trial court that he did not know whether any renovations were carried out or not. He stated: "I la st visited the building six months after the agreem ent I did not enter inside it, so I do not know what [is] there to date. I f the defendant furnished it into a three-star hotel, I don t know." The above testimony was evidence of the only witness from the respondent. The witness did not know whether the renovations were made or they were not, The only logical conclusion discernible from the respondent on the aspect of renovations is this; because the respondent did not know whether renovations were done or not, she had no basis or justification to state before the High Court, that the appellant did not carry out any renovations, installations or equipping of the leased premises. Before closing this discussion, we would have gone to consider whether time to carry out the renovations in terms of clause 7 of the lease was of essence, but we could get there only if, the respondent could have managed to prove that indeed, there was non-performance of the obligation in the 6 months. We indicated a while ago, that there was no proof from the respondent that they 19 inspected the site and there were no renovations done. Thus, we find the first ground of appeal meritorious and allow it. The complaint in the second ground of appeal is that the trial court blamed the appellant that she did not carry out an inspection of the premises around the end of the first six months of the lease. We think this complaint arises from the conclusion made at page 1715 of the record of appeal by the trial court, where the learned trial Judge observed: "H ad p a rtie s m ade it c le a r a n d in sp e ctio n m ade, either party would be satisfied that the hotel has been made to the standard required to wit, a three-star hotel as provided in the agreement, specifically on paragraph 4 o f exhibit P3. A s it is dear from the record, this was not done and no p ro o f to that effect. To m e it so u n d s th a t th is w as one o f th e n e ce ssa ry o b lig a tio n s on th e p a rt o f th e d efen d an t, th e te n a n t to prove that renovations, installations and equipm ent has been done to the standard o f the three-star hotel and that the hotel activities were ready to commence hence paym ent o f re n t " [Emphasis added] 20 It is neither clear, nor does it align with logic, to place an obligation on the appellant who was the one carrying out the works, to inspect the very works she was herself engaged in doing. The sensible expectation would have been, to hire a third party or at least a party, who is not carrying out the works to be inspected. Even in law, legally in every lease, there is an implied covenant imposing a duty to inspect the leased premises on the lessor, in this case the respondent. Section 88 (2) (a) of the Land Act provides that: "88 (2) There sh a ll be Im plied in every lease covenant by the lessor with the lessee empowering the iessor- (a) a t a ll reasonable times, to enter, either personally or by agents, the leased land or buildings fo r th e p u rp o se o f in sp e ctin g th e ir co n d itio n a n d re p a ir a n d fo r ca rry in g o u t re p a irs a n d m a kin g g o o d a n y d e fe cts w h ich it is th e le s s o r's o b lig a tio n so to d o but that in the exercise o f that power, the lessor w ill not unreasonably interfere with the occupation and use o f the land and buildings by the lessee;" [Emphasis added] We also think the same obligation is echoed at paragraph 9 (v) of the lease between the parties. That clause compels the appellant to allow the 21 respondent or her agents to enter upon the premises for purposes of viewing the premises and carrying out, the obligations that are hers, under the lease. That clause, reads: "To perm it the Lessor and his agents and other persons authorised in w riting by the Lessor to enter the dem ised prem ises a t a ii reasonable tim es during day tim e prior consent and such consent sh all not be unreasonably withheld, fo r th e p u rp o se o f vie w in g th e d e m ised p re m ise s a n d u n d e rta kin g a n y re p a irs n e ce ssa ry u n d e r th e co ve n a n ts herein before o r hereinafter contained." [Emphasis added] In our view, it was even logical that the party to inspect the premises is the one who is not implementing the works, for the one implementing the project knows it already. In the premises, we agree with Mr. Sambo, that the appellant did not have any obligation to carry out the inspections of the leased premises, and we wish to add that, if there was a party to have such a duty or obligation, it was the respondent or a jointly appointed third party. In the circumstances, the second ground of appeal has merit and we allow it. 22 The third, fourth, fifth and seventh grounds of appeal raise several intertwined complaints which may be consolidated in one general complaint, namely, that the trial Judge erred when she failed to hold that the appellant was entitled to be reimbursed the renovation expenses worthy TZS. 704,167,265.00. Mr. Sambo submitted that, the appellant sent two box files to the respondent containing the entire documentation proving expenses spent in the renovation, but the respondent instead of reviewing the documents and getting back to the appellant, she notified her vide exhibit P5 at page 1608 that, the majority of the documents were fake, so they were sent to the Tanzania Revenue Authority (the TRA) for verification. To Mr. Sambo, the unilateral act of the respondent of sending the appellant's documents to the TRA, was a demonstration of bad faith. In that letter, Mr. Sambo added, at least the respondent acknowledged that the documents relating to TZS. 116,839,616.00 were genuine. On this point, Mr. Boniphace contended that it is true that the documents were sent to the TRA, but both parties had a responsibility to follow up the documents with the TRA, and blamed the appellant for not playing her part. When we asked Mr. Sambo to point out to us specifically which evidence that was not evaluated by the trial Judge which would lead her to the figure TZS. 704,167,265.00, the learned counsel was unable to point to any specific material to prove that amount, but he referred us to two documents; one was exhibit D5 just referred to above, and another was the Judgment of the High Court particularly at pages 1720 and 1721 of the same record. At those pages in the judgment, the learned trial Judge found out that the valid receipts and vouchers proved that TZS. 305,760,075.00, to have been spent by the appellant on the renovations but did not award it to the appellant. We will quote the relevant substance from both P5 and the judgment, starting with the former, which is a letter dated 10th December, 2016 from the respondent to the appellant, stating in part that: R E: EX PEN SES IN C U R R ED FO R R EN O VATIO N A N D M O D IFIC A T IO N A T K IB O TOW ER B U ILD IN G FRO M 4 th TO 9 th FLO O R A N D THE REN TAL CH AR G ES FO R THE O CCU PIED PR EM ISES. Kindly refer to the above captioned subject. I f you recall, as the landlord we sent you several letters requesting you to subm it the receipts as p ro o f o f costs o f renovation which we started requesting on 2 8 h September, 2016 while it was your own duty to subm it them to us as per our agreem ent fo r long term lease. 24 Again, after receiving copies o f petty cash vouchers and some o f the copies o f receipts, w e fo u n d th a t m o stly w ere fa k e b u t y e t w e fin a liz e d b y th a t tim e am o u n t o f TZS. 1 1 6 ,8 3 9 ,6 1 6 .0 0 to ke ep o u t b u sin e ss re la tio n sh ip , but due to your failure to cooperate with us, we have been forced, autom atically to forw ard the whole file to the Tanzania Revenue Authority fo r verification o f the docum ents." [Emphasis added] In the judgment of the High Court, the part that shows that to a specified extent, the appellant proved that some renovations and installations were done, is at pages 1720 and 1721 of the record, where the learned trial Judge observed: "My careful perusal o f the legally found receipts tendered and [show ing] the renovations, installations and equipping done during the grace period am ounts to TZS. 305,760,075.00 (see the follow ing receipts...). These receipts as can be seen were in respect o f the grace period i.e. from 1st April, 2015 to 3(Jh September, 2015 which are to the tune o f TZS. 305,760,075.00, which am ount is payable subject to the conditions set in paragraph 8 o f the lease exhibit P3. Assum ing this am ount was deducted in the instalm ents as testified by DW1 and agreed by the p la in tiff RAV3I INVESTMENT, a fact which is not very dear as to a specific am ount deducted o r offset, th is court finds that the renovations, instaiiations and equipping was settied and the defendant Kibo Corridor Ltd is not entitled to [her] counter claim ." This part of the judgment of the trial court clears one issue, that there were renovations, installations and fitting to the hotel in which the appellant spent TZS. 305,760,075.00. However, the same part, creates yet another confusion. It states that the amount was set off in terms of clause 8 of the lease. For the moment, we will go to clause 8 in order to determine whether that amount of TZS. 305,760,075.00 could be recouped from the rent of 6 months. Clause 8 of the lease provided as follows: "The lessee sh all effect paym ent to the lessor to the tune o f 60% o f the rent fo r the first three m onths o f this tease im m ediately after com pletion o f the said renovation and the rem aining 40% sh a ll be deferred for offsetting the cost incurred by the lessee on the renovations, installations and equipping. This arrangem ent sh a ll be retained in the subsequent follow ing instalm ents o f this agreem ent until a il the costs incurred by the lessee on the renovation has fu lly been recovered, " According to this clause, 40% of the monthly rent of US$ 7,000.00 which is US$ 2,800.00 was deductible per month. This means, in 6 months 26 the amount recoverable was to be US$ 2,800.00 times 6, which would be US$. 16,800.00. Unless there was proof that the latter amount was equivalent to TZS. 305,760,075.00, we cannot agree that this amount was set-off or recouped in six months. The point we are making is this; the respondent having found that there were properly receipted expenses of TZS. 116,839,616.00 and the High Court having also found that TZS. 305,760,075.00 was properly spent by the appellant in improving the leased premises which is the respondent's, property, the court was not justified to hold that the appellant was not entitled to anything in the counter claim. In view of that, we hold that, the appellant carried out the renovations, installations and equipping in improving the leased premises and in doing so, she spent TZS. 305,760,075.00. The decision of the trial court is therefore reversed to the extent that the appellant proved and is entitled to recovery of the said TZS. 305,760,075.00 from the respondent. Accordingly, the third, fourth, fifth and seventh grounds of appeal are allowed to the above extent. Next and last, is the sixth ground of appeal. The appellant's complaint in that ground, is that she was ordered to pay rent for the premises which were not fit for her business, following the respondent's breach of the lease. Her argument being that, she was justified to withhold the rent. The breach 27 on the part of the respondent, according to Mr. Sambo, was that the respondent failed to install a functional elevator and an operational changeover switch on the standby generator. In resolving this ground, we will review the respondent's obligations in the lease and the evidence tendered. Relevant to this ground is clause 10 (ii) (iv) and (v) of the lease. That clause is to the following effect. "10. THE LESSO R CO VEN AN TS W ITH THE LESSEE A S FO LLO W S: (if) To keep th e e x te rio r a n d m ain stru c tu re a s w e ii a s th e H fts o f th e d em ised p re m ise s in g o o d re p a ir a n d on re c e ip t o f n o tice from th e ie sse e to rem ed y th e fa u lts im m e d ia te ly. (iv) To provide iift services for the exclusive use o f the lessee. ( v) To provide a standby generator in case o f power faiiure/'[Evc\phBS\s added] The issue before us is whether the appellant proved on a balance of probabilities that the lift was defective and not fit for the purpose, and also whether the generator was functional. We will start with the elevator, in view of the learned trial Judge's observation at page 1710 of the record of appeal, when she stated: 28 "It is m y considered view that, the fact that the lift and the changeover generator were not working properly does not am ount to [a ] breach o f the contract as a lleg e d .... I agree that the same m ight have not [been working] properly at som e tim es and after it had worked from 1st October, 2015 and that the notices were given to the defendant. But [in ] m y opinionf [that] does not am ount to breach o f the [lease agreem ent] as we are told by DW1 that it was in February 2016, which is five m onths after the hotel started to operate. Again, the fact that the defendant, Kibo Corridors Ltd on 1st October, 2015 paid the first instalm ent o f the rent, is a dear indication or p ro o f that everything was in order including elevators and the changeover generator, otherwise paym ent o f rent could not be made," According to the learned trial Judge, because the appellant paid rent for six months on 1st October, 2015 and because the lifts were working from that time, then on 26th February, 2016 the lift would not break down. We gave ourselves some time to think about the trial Judge's reasoning in that respect, we must confess, we failed to rationalize it. Anyhow, at least the trial court agreed that there were defects in the lift and the same were communicated to the respondent. We agree with the latter position, that there were mechanical defects in the lift on 26th February, 2016 in terms of 29 the evidence of John Charles Kessy (DW1) and George Msuya (DW2) at pages 986 and 1080, respectively. It is also correct that the defect was reported to the respondent as per exhibits D6 and D7 on 6th April, and 9th May, 2016. The fact that the appellant reported the defects in the lift to the respondent takes us back to the lease. It takes us to clause 10 (ii) above, which obligates the respondent upon receiving notice of the defect or default, to remedy the same immediately. Again, we thoroughly studied the record, but we were unable to pick any page where it is stated that upon receipt of the notice from the appellant that the lift was defective, that the respondent sent any technician or engineer to check on the fault reported and if possible, remedy it. In fact, PW1, the only respondent's witness in the case told the court that, he went to the premises at the expiry of the initial six months of the lease and never went there anymore. The said witness added that, even when he went there, he did not go inside the leased premises. That is to say, not only that the respondent did not respond to the notice to remedy the fault immediately as required by clause 10 (ii) of the lease, but she did not remedy the same at all. What is on record is that, instead of sending elevator technicians, the 30 respondent instituted a law suit seeking to recover rent and other reliefs, about a year later in March, 2017. As observed by the learned trial Judge, the appellant's complaint was that upon the respondent being notified to remedy the defect, the latter did not respond. According to DW1, it was the malfunction of the lift that frustrated her hospitality business and made it a nightmare. In other words, it is true that the lift was installed in the building; which means clause 10 (iv) of the lease was not breached as argued by Mr. Sambo, but the lift was not maintained or repaired upon issuance of notices (exhibits D6 and D7) sent to the respondent as required. That, in law, is called breach of contract. However, as the contract in question was in the nature of a lease, remedies and reliefs are provided for under Sub Part 4 of Part IX of the Land Act. The relevant section providing for remedies or reliefs of a lessee where a lessor breaches a covenant in the lease, as it happened in this case, is section 190 (2) (d) of the Land Act where it is provided as follows: "109.-(2) Where a lessor is in breach o f a covenantor condition in a lease which he is under an obligation to observe and com ply with, the lessee m ay- 31 (d) repudiate the iease and cease to pay any rent under it on the grounds that the lessor's conduct shows that he does not intend to com ply with the lease, and m ay pursue any two o r more o f these actions together as the case m ay require." Clearly, the learned trial Judge's order that the respondent should be paid rent subsequent to her failure to remedy the defect in the lift, does not accord with the above provision of the law. The respondent could be entitled to rent, only if she was not in any breach of the lease. According to the above provision of the law, the appellant was entitled to withhold the rent. Thus, without any further ado, in compliance with the above section of the Land Act, we reverse the order of the High Court, awarding the US$ 37,800.00 equivalent to TZS. 84,294,000.00 and any other rent payments to the respondent, and order that the same was supposed to be withheld by the appellant. Before we conclude this ground of appeal, we wish to make one remark, in respect of provision of a standby generator. In that respect, what was covenanted in the lease was provision of a standby generator, which was provided, because according to the evidence the generator was in place, but that it was not mounted with an automatic change over system. We have 32 studied the lease and noted that the generator to be installed in the building had no specifications in order for us to fault the respondent's provision of the generator which did not have a particular system. So, we do not agree with Mr. Sambo that failure to install an automatic changeover device in the genset, amounted to breach of any term of the lease. That said, and for different reasons and to the extent explained, we allow the sixth ground of appeal. Finally, a word or two about the eighth ground of appeal. Mr. Boniphace informed us that he was unable to respond to it in writing and even orally, because the appellant's side did not argue it. We did not hear Mr. Sambo elaborating the complaint in that ground. In that case, we hereby dismiss that ground for want of prosecution. In view of the above discussion; first, the appellant is entitled to payment of TZS. 305,760,075.00 as the proved expenses of the renovation, installations and equipping the respondent's leased premises. Second, the appellant was entitled to withhold rent of US$ 37,800.00 equivalent to TZS. 84,294,000.00 and any other amount of rent that might have been paid in enforcement of the decree of the trial court. The appellant is entitled to the refund of that amount from the respondent, only if in compliance with the 33 decision of the High Court, she paid any rent amount to the respondent. This order, however, does not concern rent of up to 30th June, 2016, which rent the appellant had already paid to the respondent. In brief, all orders passed in the decree of the High Court against the appellant are reversed except for only an eviction order, which is upheld. Lastly, except for the eighth, ninth and tenth grounds of appeal which have been dismissed, this appeal has merit and the same is allowed to the above extent, with costs. DATED at MOSHI, this 13th day of June, 2024. G. A. M. NDIKA JUSTICE OF APPEAL Z. N. GALEBA JUSTICE OF APPEAL L. E. MGONYA JUSTICE OF APPEAL The Judgment delivered this 13th day of June, 2024 in the presence of Mr. Moses Muyungi, learned counsel holding brief for Mr. Gwakisa Sambo, learned counsel for the Appellant and Mr. Paulo Kileo, Human Resource Officer & Mr. Mehul Sampat, Administrative Officer for Respondent, is hereby certified as a true copy of the oris nal. I a- A. S. (JHUGULU DEPUTY REGISTRAR COURT OF APPEAL 34