standard chatered bank t ltd vs testa ltd and others 2020 tzhccomd 58 12 may 2020

IN THE HIGH COURT OF TANZANIA (COMMERCIAL DIVISION) AT PAR ES SALAAM. COMMERCIAL CASE NO. 32 OF 2019

STANDARD CHARTERED BANK TANZANIA LIMITED..................................... PLAINTIFF/APPLICANT

VERSUS TESTA LIMITED................................. 1st DEFENDANT/RESPONDENT JOHN JOHN M NYIKA........................2nd DEFENDANT/RESPONDENT LAZARO OBADIA MTANI................... 3rd DEFENDANT/RESPONDENT

DEFAULT JUDGMENT B.K. PHILLIP, J The Plaintiff herein lodged this case against the Defendants praying for judgment and decree as follows:- i. Payment of the sum of Tanzania Shillings Two Hundred Fifty Nine Million Nine Hundred Sixty Forty Thousand Nine Hundred Ninety Cents Ninety eight (TZS 259,964,990.98) as of 22nd January 2019 being the outstanding amount on account of the Credit Facility. ii. Interest on the outstanding amount specified at (i) above at the rate of Twenty three percent (23%) from 22nd January 2019 to the date of judgment. i iii. Interest on the outstanding amount specified at (i) above at the rate of Twenty Three percent (23%) from 22 January 2019 to the date of judgment. iv. Interest on the decretal amount at the court's rate of seven percent (7%) from the date of judgment until full and final payment. v. Costs of the suit. vi. Any other reliefs which this honourable court may deem just to grant in favour of the plaintiff. Brief facts to this case are as follows; That in 2012, by way of facility letters dated 4/5/2012 and 7/8/2012. The plaintiff granted a term loan facility to the defendant to a tune of Tshs. 300,000,000/=. The said loan was supposed to be repaid within (48) forty eight months in monthly installments of Tshs. 9,129,108.70 inclusive of interests charged at twenty percent (20%). The securities for the loan were as follows; i. A Mortgage over

residential property located on C.T. No. 71797 Plot Number 34 Block 2, Bunju Area, Kinondoni Dar es Salaam in the name of Erasto Kichamo Tumbo for Tanzanian Shillings One Hundred Sixty Million (TZS. 160,000,000/=). ii. A Mortgage over residential property located on C.T. No. 118459 Plot Number 227, Block 4 Mbweni JKT Area, Dar es Salaam in the name of Charles Tumaini Chanyika for Tanzanian Shillings One Hundred Forty Million )TZS. 140,000,000/=). iii. Personal guarantee from the 2nd Respondent for Tanzanian Shillings Three Hundred Million (TZS. 300,000,000/=) 2 iv. Personal guarantee from the 3rd Respondent for Tanzanian Shillings Three Hundred Million (TZS. 300,000,000/=) v. Personal guarantee from Charles Tumaini Chanyika for Tanzanian Shillings One Hundred forty Million(TZS. 140,000,000/=) vi. Personal guarantee from Erasto Kichamo Tumbo for Tanzanian Shillings One Hundred Sixty Million (TZS. 160,000,000). It is the plaintiff's case that the 1st defendant defaulted to the repayment of the credit facility and as on 22/1/2019, the sum of Tshs. 259,964,990.98 comprises of the principal debt and interests was outstanding due to the aforesaid default in repayment of the loan. The plaintiff served all respondents with demand letters for payment of the outstanding amount to a tune of Tshs. 219,933.94 as at 19/5/2014, within (14) fourteen days, but the respondents did not heed to

the demand letter. On 4/2/2019 the applicant issued other demand letters to all respondents for the payment of Tshs. 259,964,990.98 within seven days. Once again the defendants failed to heed to the demand letters. The court's records show that the defendants were duly served with the plaint and summons to file defence, however, it is only the 2nd defendant (John John Mnyika) who filed the written statement of defence. Thus, pursuant to the provisions of rule 22(1) of the High Court Commercial Division Procedure rules, 2012 as amended by the High Court Commercial Division Procedure (Amendment) Rules GN No. 107 of 2019, the applicant filed an application 3 for default judgment against the 1st and 3rd defendants. Therefore this default judgment is in respect of the 1st and 3rd defendants only. The plaintiffs application for default judgment is supported by an affidavit sworn by George Cleophance, the principal officer of the plaintiff. The deponent has narrated in detail the back ground to this case, which I think I don't need to repeat it here as I have already narrated the same at the beginning of this judgment. However, I think it is worth stating here that the deponent has attached copies of the facility letters in respect of the credit facility the subject of this judgment, demand letters served to the respondents and the Bank Statement in respect of the 1st defendants Bank

account. Having perused the affidavit in support of this application and the attached documents, I am satisfied that the plaintiff have proved his claims against the 1st and 3rd defendants to the standard required by the law. Accordingly, in terms of rule 22 (1) of the High Court (Commercial Division) Procedure Rules, 2012 as amended by the High Court Commercial Division Procedure (Amendment) Rules GN. No. 107 of 2019, I hereby enter a default judgment against the 1st and 3rd defendants jointly and severally as follows:- i. The 1st and 3rd defendants shall jointly and severally pay the plaintiff the sum of Tanzania Shillings Two Hundred Fifty Nine Million Nine Hundred Sixty Forty Thousand Nine Hundred Ninety Cents Ninety eight (TZS. 259,964,990.98) being the outstanding amount on account of the Credit Facility as at 22nd January 2019. 4 ii. 1st and 3rd defendants shall jointly and severally pay interest on the decretal sum in (i) above at the rate of Twenty Three percent (23%) from 22nd January 2019 to the date of judgment. iii. The 1st and 3rd defendants shall jointly and severally pay interest on the decretal amount at the rate of seven percent (7%) from the date of judgment until full and final payment. iv. The 1st and 3rd defendants shall bear the costs of the suit. And in terms of rule 22 (2) (a) and (b) of the High Court Commercial Division) rules, 2012, I further direct

that the decree in this case shall not be executed unless the decree holder has within a period of ten (10) days from the date of this judgment, published a copy of the decree in at least two (2) newspapers of wide circulation in the Country and after a period of twenty one (21) days from the date of expiry of the said period of (10) days has lapsed. Dated at Dar es Salaam this 12th day of May 2020. 5