lilian steven kimaro vs ali mohamed ali and 2 others 2021 tzhclandd 705 29 march 2021

IN THE HIGH COURT OF UNITED REPUBLIC OF TANZANIA (LAND DIVISION) AT PAR ES SALAAM LAND CASE NO. 17 OF 2019 LILIAN STEVEN KIMARO........................................................ PLAINTIFF VERSUS ALI MOHAMED ALI.............................................................................. 1stDEFENDA SOPHIA SOMO OMAR......................................................................... 2ndDEFENDA MAMY ABUBAKAR FADHIL.................................................................. 3rdDEFENDA Last Order: 22/02/2011 Judgment date: 29/03/2021 JUDGMENT MANGO, J. The Plaintiff sued the defendants jointly for recovery of a loan of Tanzanian Shilings Sixty Million (Tshs. 60,000,000/-) alleged to have been advanced to the defendants on 30th May 2014. In her Plaint, the plaintiff prayed for the following orders i. Possession of the mortgaged property known as TMC/VIJ/02/03, located at Kigamboni Kisiwani, Temeke, Dar es Salaam; ii. Sale of the Mortgaged property to recover the Principal amount of the loan and interest there on amounting Tshs.60,000,000/- and payments as stated under paragraph (iii),(iv),and (v); i iii. Payment of interest of Tshs. 60,000,000/-at commercial rate of 32% per cent from 31st July 2014 to the date of Judgment; iv. Interest of decretal sum at 12% from the date of judgement till final payment; v. Costs abide the results of this suit; and vi. Any other order(s) this court may deem fit to grant. The defendants refused service of court summons as evident from the affidavits of court server dated 3rd July 2019 and 24th March 2020. On 27th March 2020 this court, after several unsuccessful attempts to have the defendants served, ordered the matter to proceed ex parte against the defendants. The Plaintiff had legal services of the Mr. SYMPHORIAN REVELIAN KITARE, learned advocate. Before hearing, the following issues were drawn; i. Whether there was a valid loan agreement between the plaintiff and the defendants ii. Whether the defendants mortgaged house No TMC/VIJ/02/03 iii. To what reliefs are parties entitled to In proving her case the Plaintiff who was the only witness in this case testified that, she is working as a money lender who deals with small loans. She holds a business licence No. 1769776 issued on 15th July 2014 by the Commissioner for Internal Trade. The business lincence was admitted as Exihibit Pl. On 30th May 2014 the defendants requested a loan of Tshs. 50 Mil to be paid back on 31st July 2014. The plaintiff granted the requested loan to the defendants and they agreed that the defendants shall pay Tshs. 60MSI on 31st July 2014, 50 Million being the principle amount and 10 Million being interest to the amount 2 of loan advanced to them. The plaintiff tendered the loan agreement executed between her and the defendants dated 30th May 2014, which was admitted as exhibit P4. As security for the loan, the defendants mortgaged his house at Kigamboni registered in the name of Ally Mohamed with residential licence No. VJB/MKJ/591. The defendants handled to her a sale agreement between Mohamed Ali and Nadhilu Hassan which shows that the defendants acquired title over the house in dispute through purchasing the same from the said Nadhilu Hassan on 3rd September 2008. The Plaintiff tendered the sale agreement and the same was admitted as Exihibit P2. On 5th December 2014 the plaintiff wrote a demand letter to the defendants. The said letter was admitted as exhibit P5. The demand notice contains the amount in default, interest, and the requirement to pay the amount defaulted within 60 days. It also indicates consequences of non-payment of the defaulted amount and accrued interest. Such consequences includes sale of the mortgaged house to recover the defaulted loan amount. According to the evidence produced, there is no dispute that the plaintiff and the defendant entered into a loan agreement as it appears in Exhibit P4. The plaintiff is a competent money lender holding a business licence No. 1769776 and both parties have capacity to contract. The terms of the agreement are expressly provided and they are free from any ambiguity. For that reason the first issue is answered in affirmative. Regarding the second issue, Paragraph 3 of the loan agreement indicates that the defendants mortgaged the suit house. The paragraph reads; 3 Kwamba Mkopaji ameweka dhamana nyumba yake iliyoko Kigamboni Kisiwani, kata ya Kigamboni, Manispaa ya Temeke Dar es salaam ambayo iko kwenye kiwanja ambacho nakala ya hati ya mauzo Kumbukumbu Na. TMC/VIJ/MKJ/02/03 imeambatishwa kwenye makubaliano haya. However, the paragraph refers to a single debtor which suggest that it was referring to ALI MOHAMED AU whose name appears in the sale agreement attached to the loan agreement. The law requires mortgagee to secure spousal consent before mortgaging a matrimonial property. In the case at hand the plaintiff secured spousal consent by making the spouses of the first defendant’s wives party to the loan agreement. The two wives of the ALI MOHAMED ALI namely SOPHIA SOMO OMAR and MAMY ABUBAKAR FADHIL signed the loan agreement as parties to the agreement. Moreover, paragraph 5 of the sale agreement indicates that parties to the agreement have consented the mortgaging the suit house. The paraghraph reads:- Kwamba wakopaji kwa pamoja wameridhia kutoa dhamana ya nyumba iliyotajwa hapo juu kwa ajili ya mkopo huu. This paragraph indicates clearly that consent was granted by all the parties to the agreement, therefore it satisfies the requirements of Section 114(1) of the Land Act, [Cap.113 R. E. 2019]. The section provides:- 114(1) A mortgage of a matrimonial home including a customary mortgage of a matrimonial home shall be valid only if:- a) Any document or form used in applying for such a mortgage is signed by, or there is evidence from the document that it 4 has been assented to by the mortgagor and the spouse or spouses of the mortgagor living in that matrimonial home. The loan agreement is written in Kiswahili language which most of Tanzanians understand, it was signed by both defendants and it contains express terms and conditions. Therefore I find the mortgage deed to be valid. In exercising her powers as a mortgagor, the plaintiff wrote a demand notice to the defendants. The law requires the mortgagor to issue a 60 days default notice. The contents of the demand notice qualifies to be considered as a 60 days default notice prescribed under section 127(1) & (2) of the Land Act,[Cap 113R.E 2019]. Exhibit P5 shows that the letter was received by the defendants but no evidence of any payments made to honor the same. The remaining stage was for the mortgagor to exercise his powers of sale to recover the amount in default. As the mortgage was informal and unregistered, the mortgagee required a court order before disposing the mortgaged property to recover the unpaid loan. Evidence produced by the plaintiff establishes that, the defendants borrowed money from the plaintiff, they mortgaged their matrimonial house as a security for the loan and they have defaulted in paying the loan advanced to them. For those reasons, this court finds the plaintiff to have proved her case in the required standards and issues the following orders:- i. Sale of the Mortgaged property to recover the Principal amount of the loan and interest there on amounting Tshs. 60, 000,000/=; ii. Payment of interest at commercial rate of 17% per cent from 31st July 2014 to the date of Judgment; 5 iii. Interest of decretal sum at 12% from the date of judgment till final payment; and iv. Costs of the suit. 6