mobikey truck and bus ltd vs junior construction co ltd 2023 tzhccomd 176 8 june 2023

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA (COMMERCIAL DIVISION) AT PAR ES SALAAM COMMERCIAL CASE NO. 47 OF 2022 BETWEEN MOBIKEY TRUCK AND BUS LIMITED...................................... PLAINTIFF VERSUS JUNIOR CONSTRUCTION COMPANY LIMITED................... DEFENDANT JUDGMENT Date: last order: 08/06/2023 Date of judgment: 16/06/2023 AGATHO, J.: The plaintiff Mobikey Truck and Bus Limited approached this court armed with plaint alleging that the defendant breached the contract the two had. The plaintiff seeks the court to grant the following reliefs as contained the plaint: (a) The defendant to pay the plaintiff the sum of USD 134,950.57 being the costs of four (4) vehicles (MAN TGS WW) sold by the defendant to the plaintiff. (b) Payment of interest on (a) above at the commercial rate of 20% running from the date of filing the suit to the date of judgment. i (c) The defendant to pay the plaintiff interest on the decretal amount at the court rate of 7% from the date of judgment till when the decree is fully satisfied. (d) The defendant to pay the plaintiff general damages to be assessed by the court. (e) The defendant to pay the plaintiff costs of the suit. (f) Any other reliefs that the court may deem fit. Upon being served with copy of plaint the defendant filed her written statement of defence to protest the suit. The parties enjoyed legal services of abled learned counsel. Whereas the plaintiff was represented by Mr Ndanu Emmanuel, the defendant was under representation of Mr Juventus Katikiro. To appreciate the gist of the suit at hand background ought to be sketched. The parties entered a 10 trucks (vehicle) sale and purchase agreement. The value of the trucks was Two hundred and Nighty-Eighty Thousand Five Hundred Euros (298,500€). The plaintiff was a seller, and the defendant was a purchaser. It was agreed that the trucks were to be purchased on credit. The agreement further required that defendant to pay USD 70,000/= as down payment for 10 trucks. However, the defendant paid USD 50,000/= and was given four trucks so that she could continue 2 with the dam construction project at Kilombero. She promised to pay the remaining USD 20,000/= as part of down payment so that she could have the remaining six trucks. That was not done and the down payment of USD 20,000/= was not paid and the purchase price was not paid too. Following that situation, the plaintiff refused to release the six remaining trucks and claimed the purchase price for the four trucks in hands of the defendant. Having failed all initiatives to hold the defendant accountable for the breach of alleged contract, the plaintiff filed a suit in this court and praying for reliefs as indicated hereinabove. The matter went through court annexed mediation which failed to reconcile the parties. It was thus marked failed. The suit then proceeded to final pre-trial conference where the following issues were framed: (1) whether there was a breach of sale and purchase agreement executed by the parties on 18/05/2021? (2) Whether the Plaintiff is entitled for payment of USD 134,950. 57 being cost for the four vehicles sold to the defendant on credit? (3) To what reliefs are the parties entitled to. Before endeavouring to determine the above issues, it is worthv to sketch evidence adduced during the trial. The plaintiff brought witness (PW1) whose witness statement is adopted in these proceedings to 3 form part of his testimony in chief. And the defendant had intimated to call one witness (Suleiman Masoud Suleiman) who filed his witness statement. But to the court's dismay he did not enter appearance at trial to testify. That prompted the defence counsel to pray for adjournment of defence case on 05/06/2023, which was granted. The hearing resumed on 08/06/2023. But surprisingly the defendant's counsel informed the court that the witness is abroad in Dubai. He could not appear in court for that reason. He thus prayed for another adjournment of the trial. This did not impress the court as the learned counsel did not bring any air ticket or visa to support his prayer that the witness is abroad. There was not any evidence to substantiate what the counsel submitted. He prayed in alternative that if the adjournment is refused then the witness statement be accorded the weight as per rule 56(3) of High Court Commercial Division (HCCD) Procedure Rules, 2012 as amended in 2019. The court was unimpressed. Consequently, it struck out the defendant's witness statement as per rule 56(2) of the HCCD Procedure Rules. For that matter, there was not any evidence recorded by the court from the defendant. 4 I feel obliged to ponder further the issue of witness statement. It should be noted HCCD rules provide for conduct of examination in chief by way of witness statements. Rule 56(1) of the HCCD Rules is loud that when witness statement is filed in court, the witness who made the statement shall appear for cross examination. That is obligatory. However, the proviso to rule 56(2) of the HCCD Rules provides discretion to the court to receive the witness statement in absence of its maker in exceptional situations. The law does not define what exceptional situations or exceptional reasons are. Certainly, the court must exercise such discretion judiciously. In my view, a party who wants the court to receive the witness statement while stating the exceptional reasons he must support it with evidence. Failure to do so is risking the witness statement to be struck out from court record as provided for under rule 56(2) of the HCCD Rules. Of significance to note is the implication of rule 56(3) of the HCCD Rules is that when the witness statement is received in court without the witness appearing then such statement shall be accorded less weight. One may ask why giving it less weight. The rationale is that such testimony though received, the witness' demeanour, veracity and credibility of that evidence has not been tested by cross examination. The witness' credence may be doubtful. That is why it 5 should be accorded less weight during evaluation of evidence. Therefore, whenever the court is confronted with a witness statement whose maker fails to appear in court for cross examination, the court has two options. One, to strike it out. Two, to receive it under exceptional circumstances with exceptional reasons. That is, there should be justifiable cause backed with evidence. In the latter case, the court is required to accord such statement less weight. Now, back to the case at hand, we begin with the plaintiff's case where there was one witness called to testify. The witness (PW1), Godfrey M Belege on oath and the witness statement adopted in these proceedings as his testimony in chief testified that he is the finance and administration manager of the plaintiff. According to him the Plaintiff and the Defendant on the 10 May,2021 entered into a sale and purchase agreement whereby the Plaintiff agreed to sale and the Defendant agreed to buy ten (10) new Trucks at a consideration of Twenty-nine thousand eight Hundred and Fifty Euros (29,850€). The total costs of the 10 vehicles were Two hundred and Nighty-Eighty Thousand Five Hundred Euros (298,500€). He also tendered a copy of the agreement which was admitted as exhibit Pl. 6 He went on testifying that the Plaintiff and the Defendant agreed that out of the Ten (10) Vehicles purchased on credit the Defendant will take four (4) New Vehicles and in that respect the Defendant was supposed to deposit Fifty-Seven Thousand Euros (57,000 €) being the initial deposit and this amount was equal to United State Dollar Seventy Thousand (70,000 USD) by then. This amount will signify that the Defendant has confirmed to the sale and purchase Agreement. Unfortunately, out of that amount the Defendant only deposited United State Dollar (50,000 USD). To substantiate it the PW1 tendered a bank statement which was admitted as exhibit P2. PW1 testified that after payment of the Initial Deposit, the Defendant has never made any further payment as per the scheduled stipulated in the agreement. At the end of October, 2021, the some overdue and which the Defendant was required to make payment was United State Dollar Sixty Seven Thousand Eight Hundred and Nifty Six and Seventy Cents (USD 67,896.70). He testified that to date the total outstanding amount the Defendant is indebted by the Plaintiff stood at United States Dollar One Hundred and Thirty-Four Thousand Nine Hundred and Fifty and Fifty-Seven Cents (USD. 134,950.57). 7 PW1 being the finance Manager testified that he tried to contact the Defendant Managing director via his mobile phone but the same is not reachable. He tried even to go to their office which was located at Mchicha at Temeke, he was informed by the security guard at the place where their office was previously located that the Defendant have shifted from the premises where their office was located. He testified further that he four (4) Vehicles were fixed with car tracking system and the same have been dislocated. He was of the view that these acts of the Defendant clearly show the same has no intention of repaying the outstanding debt owed to the Plaintiff. It was PWl's testimony that clause 7 of the Agreement (exhibit Pl) categorically states that if the Defendant failed to strictly comply with the payment of instalment scheduled provided in the Agreement, the Plaintiff has the right to recover the vehicles from the Defendant and claim the remaining amount of the purchasing price or sell the vehicle to a third party in order to recover the loss. After the Defendant failed to comply with the Demand notice, the Plaintiff engaged the service of Yono Auction Mart and Court Brokers to locate the Vehicles and recover them from the Defendant and return them to the Plaintiff custody. The said court brokers 8 managed to get hold of the said vehicle in Sumbawanga District in Rukwa Region. However, they failed bring them back to the Plaintiff as they faced challenges from Police at the Central Police station in Sumbawanga whereby, they demanded a court order before they allow them to proceed with seizure of the Vehicles and bring them back to the Plaintiff yard in Dar es Salaam. As stated earlier the defendant did not bring any witness to testify. The prospective defence witness did not enter appearance. His witness statement was thus struck out from court's record. During final pre-trial conference the issues raised were: (1) whether there was a breach of sale and purchase agreement entered on 18/05/2021?; (2) whether the Plaintiff is entitled for payment of USD 134,950. 57 being cost for the four vehicles sold to the defendant on credit? And (3) to what reliefs are the parties entitled to. To start with the first issue whether there was a breach of sale and purchase agreement entered on 18/05/2021? The testimony of PW1 and exhibit Pl is loud that there was the 10 trucks sale and purchase agreement between the plaintiff and the defendants. While during cross examination the PW1 admitted not to have tendered delivery notes to 9 substantiate that the four trucks were delivered to the defendant exhibit P2 shows that the amount paid by the defendant which commensurate with the downpayment made for the four vehicles. I have also noted that in his witness statement PW1 mentioned the motor vehicle registration cards that however were not tendered in evidence. Mr Katikiro, the defence counsel submitted that since the motor vehicle registration cards and delivery notes were not tendered in court then there is no proof that the trucks were delivered to the defendant. I beg to differ with his submission. In my view the absence of the delivery notes and motor vehicles registration cards cannot vitiate the fact that the four trucks were delivered to the defendant. After all, these trucks were detained at Sumbawanga Central Police while in possession of the defendant. Moreover, the defendant never brought any evidence to rebut or discredit the exhibits Pl and P2. That matches the requirement of Section 110 of the Evidence Act [Cap 6 R.E. 2019]. In my view the cross examination failed to discredit the evidence of PW1. The plaintiff established on the balance of probability that the parties had a valid agreement, and that the four trucks were delivered to the defendant. The standard of proof in civil cases is not that of beyond reasonable doubt. Rather is on balance of probability as per Section 3(2)(b) of the Evidence io Act [Cap 6 R.E. 2019]. Therefore, the first issue is answered in the affirmative. Turning to issue (2) whether the Plaintiff is entitled for payment of USD 134,950. 57 being price of the four vehicles sold to the defendant on credit, as ordained in administration of justice one ought to consider the evidence given. The PW1 testified that there was the agreement between the parties that is exhibit Pl. He also stated in his testimony that the defendant paid down payment of USD 50,000 only that also seen in exhibit P2. Thereafter, the plaintiff while trusting the defendant allowed her to take the four trucks to do her business without completing the required down payment or initial sum of 57,000 Euros equivalent to USD 70,000. The actual down payment for the four trucks that the defendant ought to have paid is USD 70,000. Despite several reminders the defendant failed to pay the amount remaining due. This constituted a breach of clause 2 of the parties' agreement (exhibit Pl). It is also a violation of Section 37 of the Law of Contract Act, [Cap 345 R.E. 2019] which provides that: " The parties to the contract must perform their respective promises, unless such performance is dispensed with or excused under the provision of this act or by any other law." ii With clarity it was also held in Simon Kichele Chacha v Aveline M. Ki I a we, Civil Appeal No. 160 of 2018 CAT at Mwanza that: "Parties are bound by the agreement they have freely entered into, and this is a cardinal principle of the law of contract that there should be a sanctity of the contract." It is further conspicuous under clause 7 of the Agreement (exhibit Pl) that if the defendant fails to strictly comply with the payment of instalment scheduled provided in the Agreement, the plaintiff has the right to recover the vehicles from the defendant and claim the remaining amount of the purchasing price or sell the vehicle to a third party in order to recover the loss. Exhibit P3 (demand note sent to the defendant) is loud that the plaintiff's efforts to recover the price of the four vehicles proved futile. Even the engagement of Yono Auction as broker did not deter the defendant. The manifestation of the defendant's breach of contract is the act of removing or disabling the trucks tracking system. Hence the four trucks could not be tracked. Although later on they were found in Sumbawanga. The cross examination of the PW1 did little to shake the credibility of evidence given. Considering such situation, the plaintiff indeed deserves to be paid the price for the four vehicles. But how much should she paid in 12 the circumstance of this case? For the sake of justice, we should consider the price of the four trucks and subtract it with the initial sum of the purchase price paid, that is USD 50,000. Thus, if the price of the four trucks is USD 134,950.57. Then if we subtract USD 50,000 from that amount, the outstanding amount payable by the defendant to the plaintiff is USD 84,950.57. That amount is per the contract. That is exhibit Pl. As to what reliefs are the parties entitled to, that should not detain us much. The defendant prayed for the dismissal of the suit with costs. While the plaintiff prayed for the court to grant the reliefs as prayed for in the plaint. From the evidence brought before the court, the plaintiff has proved her case to the required standard in civil proceedings, that is on the balance of probability. The outstanding sum for the price of four vehicles is thus granted. The interest of 20% commercial rate is also granted as per clause 11 of the agreement between the parties it mention interest though did not state the percentage. The interest of 7% court's rate on the decretal sum is granted too. As for the claim of general damages, that is given at the discretion of the court. But since there is enough evidence adduced before the court that the defendant breached the agreement, she acted mischievously by 13 disabling car tracking system, and she disappeared with the four trucks causing business disturbances and loss to the plaintiff. She did so despite not paying the whole purchase for the four trucks. In Abualy Alibhai Azizi v Bhatia Brothers [2000] T.L.R. 288 the court held in no ambiguous terms that: "the principle of sanctity of contract is consistently reluctant to admit excuses for non-performance where there is no fraud (actual or constructive) or misrepresentation and no principle of public policy prohibiting enforcement" Further, Section 73(1) of the Law of Contract Act [Cap 345 R.E. 2019] provides that: "Where a contract has been broken, the party who suffers by such breach shall receive, from the party who has broken the contract, compensation for any loss or damage caused to him..." The evidence adduced in this case and the authorities above cited persuaded the court to grant general damages to the plaintiff. The argument that the plaintiff contracted to sale 10 trucks, and he delivered only four holds not water because the defendant ought to have paid at least for the four trucks she received. In the premises the defendant shall 14 thus pay the plaintiff USD 30,000 as general damages for business hardships she caused on the plaintiff. The plaintiff is thus entitled to: (a) The Defendant shall pay the Plaintiff USD 84,950.57 as remaining balance for the four trucks purchase price. (b) Interest on (a) 20% commercial interest from the date of filing the suit to the date of judgment. (c) Interest 7% court rate on the decretal sum from date of judgment till when the decree is full satisfied. (d) General damages to the tune of USD 30,000. (e) The Defendant shall bear the costs of this suit. It is so ordered. DATED at DAR ES SALAAM this 16th Day of June, 2023. Date: 16/06/2023 Coram: Hon. U. J. Agatho, J. For Plaintiff: Emmanuel Ndanu, Advocate For Defendant: Juventus Katikiro, Advocate. C/Clerk: Beatrice 15 Court: Judgment delivered today, this 16th June, 2023 in the presence of Emmanuel Ndanu, counsel for the Plaintiff, and Juventus Katikiro, Advocate for the Defendant. UJZAGATHO JUDGE 16/06/2023 16