samwel mgonja ta sweet corner enviro care vs kobil t ltd 2012 tzhccomd 62 15 march 2012

IN THE HIGH COURT OF TANZANIA (COMMERCIAL DIVISION)

AT DAR ES SALAAM PETITION NO 34 OF 2011 (IN THE MATTER OF THE ARBITRATION ACT CAP 15 R.E 2002)

AND

IN THE MATTER OF APPLICATION FOR APOINTMENT OF AN

ARBITRATOR

BETWEEN SAMWEL MGONJA T/A SWEET CORNER ENVIRO.CARE.................................... PETITIONER

VERSUS

KOBIL TANZANIA LIMITED.................................................. RESPONDENT

RULING BUKUKU, J Mr. Kessy, Advocate, for the respondent, by way of a preliminary objection, is challenging the filing of the petition as follows: (i) That the petition is time barred. i (ii) The application is res sub judice. And prays for its dismissal. This arises from a petition whose prayers therein are: (i) A declaratory order to refer the conflict to the single Arbitrator as per contract; (ii) Costs of the petition; and (iii) Any other reliefs deemed fit by this honourable court. The petitioner is represented by Mr. Lloyd, Advocate. Arguments were made orally. At the hearing of the preliminary objection, Mr. Kessy prayed to withdraw the second ground of objection, the prayer which was granted by this court hence giving way to proceed with the argument regarding the first limb of the preliminary objection. It is Mr. Kessy's submission that, the petitioner is seeking for declaratory orders of the court to submit to a single Arbitrator pursuant to Arbitration Act Cap 15. That section 40 (1) of the Law Limitation Act Cap 89 R.E 2002 clearly provides that the Law of Limitation Act shall apply to arbitration proceedings in the manner it applies to other proceedings. He argued further that the period of Limitation to submit arbitration to a sole arbitrator is neither stipulated in the Law of Limitation nor under the arbitration Act hence Rule 21 of part III of the schedule to

the Law of Limitation Act applies which provides for all applications for which no 2 period of limitation is provided by the law of limitation or any other limitation, the period of limitation has been stipulated to be 60 days. Mr. Kessy went on to argue that, it is clear from the provision of the law that seeking declaratory order has to be done within 60 days, and since the cause of action accrued from 8/10/2007 the matter ought to have been brought by 6/12/2007 but the same was filed on 22/12/2011 which is above 4 years delay. He contended that, Para 17 of the petition reveals that the petitioner's delay was due to the filing of a suit in the High Court Land Division believing it had jurisdiction. To him, this ignorance of law cannot be an excuse, if at all the petitioner ought to have applied for extension before filing the petition. He therefore prayed for the dismissal of the petition for being time barred. In his reply, Mr. Lloyd submitted that the petition is not time barred. He appreciated the fact that, the applicant's advocate took note of the proceedings which were going on in the High Court Land Division as pleaded in Para 11,12,13 and 14 of the petition. He argued that since section 40 (1) of the Law of Limitation equates or gives way for the provisions of the Civil Procedure Code to apply mutatis mutandis to the arbitration cause, his only duty was not to apply

for extension of time rather, they were supposed to state the grounds for which exclusion of time has to be done. He referred Order 7 Rule 6 of the Civil Procedure Code to that effect. He argued further that Section 21(2) of the Law of Limitation Act is very specific in that, if one were in another court prosecuting bona fide and become unsuccessful, this provision is very 3 particular that exclusion of time might be considered. Mr. Lloyd surmised that, in the circumstance, the issue of ignorance of law does not arise. He asserted that the petrol station in dispute was built on land which gave a bona fide belief that the High Court Land Division had jurisdiction. Invoking the provisions of section 40 of the Law of Limitation Act, and Order 7 Rule 6 of Civil Procedure Code Mr. Lloyd prayed that, in calculating the time for limitation, the court should exclude the time which the petitioner was in court. He strongly argued that, no time has been wasted outside the corridors of the court. They have all along been in court. It is thus his prayer that the time that there were in court should be excluded. In his very brief rejoinder, Mr. Kessy finalized his argument by submitting that the petitioner is praying for interlocutory orders, that there is no prayer for exclusion of time, and that Order 7 Rule 6 provides clearly where the suit is instituted after expiration of the period of

Limitation, That this being an application, the said order cannot apply and he thus insisted that the petition is time barred and should be dismissed with costs. Having gone through the submissions by both parties, the central issue for consideration before me is whether the petition is time barred. Mr. Kessy counsel for the respondent contended that the petition before this court is time barred after having been brought out of the limitation period as prescribed by Rule 21 of part III to the schedule of the Law of Limitation Act which provides for a time of limitation for all matters having no clear limitation set by any law, and the counsel intimidated further that 4 the petitioner ought to have applied for extension of time before filing the petition. On the other hand, counsel for the petitioner argued that the petition is not time barred, relying on section 21(2) of the Law of Limitation Act. Furthermore he argues that, Rule 21 of part III to the schedule of the Law of Limitation Act, and Section 40(1) of the Law of Limitation Act applies to this petition, and that since Section 40 (1) allows application of the Civil Procedure Code to Arbitration matters, then the petitioner needed not apply for extension of time but rather to state grounds for which exclusion of time need be done, and that the same is in conformity with Order 7 Rule 6 of the Civil Procedure Act. I will

start with the general principle. The law of limitation of actions is intended to protect defendant against unreasonable delay in the bringing of suits against them. The statute expects the intending plaintiff to exercise reasonable diligence and to take reasonable steps in his own interest. But rightly or wrongly, the act does not help the person who, whether through dilatoriness or ignorance, do not do what the informed citizen would reasonably have done. The Act (Limitation), is a Limitation Act, it relates only to procedure. It does not divest any person of rights recognized by law. It limits the period within which a person can obtain remedy from the courts from the infringement of them. The mischief against which all limitations Acts are directed are delay in commencing legal proceedings, for delay, may lead to injustice, particularly where the ascertainment of the relevant facts depend on oral testimony. 5 The gist of the respondent's preliminary objection is that, the petitioner needed to seek the approval of this court before filing his petition due to the fact that the same has been time barred. It is his averrement that, since the period of limitation to submit a matter to a sole arbitrator is neither stipulated in the law of limitation nor under the Arbitration Act, then, rule 21 of part III to the schedule of the Law of Limitation Act, governs applications of this

nature. That Rule provides: "21. Application under the Civil Procedure Code, The Magistrate's Courts A ct or other Written law for which no period o f limitation is provided in this A ct or any other written law ................... sixty days." Indeed, section 40 (1) of the Law of Limitation Act allows the application of the law of Limitation to the arbitration proceedings and therefore, it is true that, an application of this nature falls under rule 21 of part III to the schedule of the Law of Limitation Act. The said section reads; 40(1)-" This A c t shall apply to arbitrations in the same manner as it applies to other proceedings". The parties are not at grievance that the law of Limitation gives the time of limitation on the matter at hand, what they are at variance with is whether after the limitation period having expired (i.e. sixty days from the date when the cause of action arose), the petitioner ought to have applied for exclusion of time before filing the matter or not. On the one hand, Mr. 6 Kessy, Counsel for the respondent maintained that, the applicant ought to have applied for extension of time. Unfortunately, Mr. Kessy did not provide this court with any authority to substantiate his argument. On the other hand, Mr. Lloyd, learned counsel for the petitioner has maintained that there was no need to apply for an extension, since they have disclosed the reasons

for the delay being prosecuting the matter bonafidely before the High Court Land Division believing the court had jurisdiction to entertain the same which was not the case and that the grounds are obvious in Para 11, 12, 13 and 14 of the petition. Much as I subscribe to the earlier submission by Mr. Kessy that ignorance of the law is not an excuse, Unfortunately, I wish to differ with him on this. The reason being that, the question of jurisdiction is a threshold issue to be determined by the court seized of the matter at the threshold stage, using such evidence as may be placed before the court by the parties. Now, the averment of Mr. Lloyd is that, since the dispute was over a petrol station built on land, they had drawn an inference belief that the Land Court had jurisdiction a thing which turned out not to be the case as the suit was dismissed for lack of jurisdiction. To me, whether that was ignorance of the applicant or not, is a matter which does not concern us now. I have carefully considered the issue. In so doing, I have also taken note and do agree with the reasons advanced in the submission by Mr. Lloyd, learned counsel for the applicant that, all what was required of him was to give the grounds on which exclusion of time should be considered 7 in computing the period of limitation. As rightly submitted by Mr. Lloyd, Order 7 Rule 6 of the Civil Procedure Code

requires the applicant to show ground of exemption from limitation law. That section reads: "Rule 6-Where the suit is instituted after the expiration o f the period prescribed by the law o f limitation, the plaint shall show the ground upon which exemption from such law is claimed." Counter rejoining the cited order, Mr. Kessy submitted that the said Order 7 Rule 6 do not apply on the matter before this court which is an application and not a suit, Without much ado, I wish to differ with Mr. Kessy on this. The term suit has been defined to include application or petition. In the case of TANZANIA CIGARETTE COMPANY LTD VERSUS MASTERMIND TOBACCO (T) LTD; CIVIL APPEAL NO. 7 O F 2005 (CAT- Kiieo, Massati and Oriyo J J A ) (Delivered on 22n d January,2010) it was observed that the word "suit" is quite wide and covers civil proceedings, civil claims, and that the mode of presenting such claims may be done by a plaint, petition, or by way of a chamber summons. Not only that, Black's Law Dictionary, Ninth Edition at page 1572, defines the word Suit as follows: "Any proceeding by a party or parties against another in a court o f law." It is therefore obvious that, the wording of Order7 Rule 6 of the Civil Procedure Act do apply to the circumstances of this petition before this court as properly presented by Mr. Lloyd. 8 The wordings of this rule are couched such that, if a claim is

prima facie barred by limitation, and the plaintiff claims it to be within time by reasons of any of the exceptions to the general rule of the Limitation Act, the grounds upon which exemption is claimed shall be shown in the plaint or the petition. If the claim is prima facie barred by the general rule of limitation, and the ground of exemption is not alleged, the plaint or petition is liable to be rejected under Order? Rule 6 of the Civil Procedure Act. My understanding of this rule is that, all what is required is that the plaint or the petition should show the ground of exemption From the above observation, I do not hesitate to state that, what Mr. Lloyd, Learned Counsel for the petitioner did was in conformity with Order? Rule 6 of the Civil Procedure Act, read together with section 21(1) of the Law of Limitation Act. This section relates to exclusion of time of proceeding bona fide in court without jurisdiction. For clarity, I will reproduce it as hereunder: "21 (2) In computing the period o f limitation prescribed for any application, the time during which the applicant has been prosecuting, with due diligence, another civil proceeding, whether in a court o f first instance or in court o f appeal, against the same party, for the same relief, shall be exclude, where the proceedings is prosecuted in good faith in a court ofwhich, from defect o f jurisdiction or other cause

o f a like nature, is incompetent to entertain it." 9 From the pleadings, it obvious that, all this time the applicant was prosecuting the matter in bona fide in the Lands Division of the High Court and Mr. Lloyd has convinced this court that he has not wasted time outside the corridors of the court. Mr. Lloyd has shown that the delay was not caused intentionally rather, it was a brief that the Land Court had jurisdiction to entertain their dispute. For the above reasons, the applicant's failure to file the petition within the time prescribed by the law was based on sound reasoning. They were prosecuting their case in court. Under such circumstances, the preliminary objection is hereby overruled with costs. It is accordingly ordered. A.E BUKUKU

JUDGE 15 MARCH, 2012 10 Ruling delivered this 15th day of March in the presence of Mr. Mwakinda, Learned Counsel for the petitioner and also holding brief for Mr. Kessy Learned Counsel for the Respondent. A.E BUKUKU

JUDGE 15 MARCH, 2012 Word Count: 2,412 11