ncg chemical industries limited company vs amri bakari malombora 60 others 2023 tzhclandd 16811 25 august 2023

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA (LAND DIVISION) AT DAR ES SALAAM LAND CASE NO. 209 OF 2022. BETWEEN NCG CHEMICAL INDUSTRIES LIMITED COMPANY.............................. PLAINTIFF VERSUS AMRI BAKARI MALOMBORA..................................................... 1st DEFENDANT JENIFER RICHARD KANGOZI.................................................... 2nd DEFENDANT LOVENESS SHAMI NYUTON........................................................3rd DEFENDANT ALLY SALUM MPENDA................................................................. 4™ DEFENDANT REHEMA SHABANI....................................................................... 5th DEFENDANT ALLY OMARI NJECHELE.............................................................. 6th DEFENDANT HASSAN JUMA SEFU.................................................................... 7th DEFENDANT IMANUEL GILBERT...................................................................... 8th DEFENDANT HAMISI HALIDI............................................................................9th DEFENDANT JAFARIIBRAHIMU MJIJI............................................................ 10™DEFENDANT ZAINABU OMARI CHINGEGE...................................................... 11™DEFENDANT AMIRI WAZIRI HAMZA............................................................... 12™ DEFENDANT ASHA SALUM MCHECHELE.......................................................... 13™ DEFENDANT MGENI ALLY KUSA....................................................................... 14™ DEFENDANT VICTORIA ABDALLAH.................................................................. 15™DEFENDANT HALIMA SALUMU MWELA........................................................... 16™ DEFENDANT MOHAMED SALUM NAMKUNDA................................................ 17™ DEFENDANT 1 OMARI MOHAMED MKUMBA ........................... 18™ DEFENDANT MOHAMED HAMZA KILAMBO.................................................... 19™ DEFENDANT RAMADHANI HAMIS MKINGIE......................................................................... 20™DEFENDANT ATHUMAN MUSSA ATHUMAN................... 21st DEFENDANT RAMADHANI KASIMU NDUNDUL..................................................................... 22ndDEFENDANT AMINA MOHAMEDI........ ............... 23Rt> DEFENDANT ABDALLAH BAKARI MBONDE........................................................................... 24™DEFENDANT VALENTINE MALIMA PAMBA.............................................................................25™DEFENDANT HALIFANI SUDI BINDA..................................................................................... 26™DEFENDANT ELIA ANTHONI MLAWA..................................................................................... 27™DEFENDANT HAMADI BODO................................................................................................... 28™DEFENDANT LEBEATUS............................................................................................................ 29™DEFENDANT JAMES ELIAS...................................................................................................... 30™DEFENDANT VERONICA ADRIANO......................................................................................... 31stDEFENDANT JULIUS JOHN NGWAYA.................................................................................... 32ndDEFENDANT TAPHAEREL M. MAHIMBO................................................................................. 33rdDEFENDANT SIWEMA SHABANI............................................................................................. 34™DEFENDANT AMINA JAFARI................................................................................................... 35™DEFENDANT SEVERIN S. KOMBA............................................................................................36™DEFENDANT ZARUBIA MOHAMED......................................................................................... 37™DEFENDANT OMARI YAHYA.................................................................................................... 38™DEFENDANT ADERTUS GIDION............................................................................................... 39™DEFENDANT RAUNESN SHANI................................................................................................ 40™DEFENDANT MARY JOHN MPAGANUA................................................................................... 41stDEFENDANT ANASTAZIA ADUIS THOMAS............................................................................ 42ndDEFENDANT JOHARI ALLY SAID............................................................................................ 43rdDEFENDANT MMOHAMED A. KI RAM BO..................................................................................44™DEFENDANT RAMADHANI HAMISI........................................................................................ 45™DEFENDANT HEMEDI ALLY...................................................................................................... 46™DEFENDANT REHEMA SAIDI................................................................................................... 47™DEFENDANT 2 DEO KOMBA................... .48™ DEFENDANT ARIFA M. MAIDA........... .49™ DEFENDANT HASSAN M. MAJAUKWA .50™ DEFENDANT SALUM MSUSA............... .51st DEFENDANT HAIRUN IDDI............... 52nd DEFENDANT ZULFA RASHIDI....................................... 53rd DEFENDANT NOEL CHIZOZA............................................................ 54™ DEFENDANT LIMALI DINDEMELA.......................... 55™ DEFENDANT SHAHIDU HARUNA..... .56™ DEFENDANT MRISHO MOHAMED.... 57™ DEFENDANT ALBERT D. CHALE........ .58™ DEFENDANT VESTEN MKINGA......... ,59™ DEFENDANT ABDUL SAID MGUNDA .60™ DEFENDANT ROBERT NGAZDA....... .61st DEFENDANT RULING Date of last 0rder:02/08/2023 Date of Judgment:25/08/2023 K. D. MHINA, J. This is the ruling in respect of the preliminary objection raised by the 2nd, 3rd, 7th, 11th, 13th, 14th, 15th, 16th, 19th,20th, 34th, 35th, 41st, 42nd, 46th, 48th, 53rd, 58th, and 60th defendants against the plaintiff's suit on the dispute over the land ownership. The main dispute between the parties is the ownership of surveyed land described as Farm No. 40 with a certificate of title No. 37278 located at Kazole, Vikindu, in Mkuranga District. 3 Despite filing their written statements of defence but also before the commencement of the hearing, the 2nd, 3rd, 7th, 11th, 13th, 14th, 15th, 16th, 19th,20th, 34th, 35th, 41st, 42nd, 46th, 48th, 53rd, 58th, and 60th defendants confronted the plaint with a notice of a preliminary objection that canvassed one ground, namely; i. The suit filed by the plaintiff is incompetent as it contravened section 147 (1) (a) and (b) of the Companies Act, Cap 212 R: E 2002. Therefore, this Court had to deal with preliminary objections first because it is trite that once a court is seized with a preliminary objection, it is first required to determine the objection before going into the merits or the substance of the case or application. The objections were argued by way of written submissions duly drawn and filed by Mr. Alex Enock, learned advocate for the 2nd, 3rd, 7th, 11th, 13th, 14th, 15th, 16th, 19th,20th, 34th, 35th, 41st, 42nd, 46th, 48th, 53rd, 58th, and 60th defendants, and Mr. Ashirafu Muhidini, learned advocate for the plaintiff. In supporting the preliminary objection, Mr. Enock submitted that in the present suit, the plaintiff, being the limited liability company registered under the Companies Act 2002 at the time of instituting this suit, did not 4 consider the requirement of section 147 (1) (a) and (b) of the Companies Act. The section provides that "Section 147(1) anything which in the case of a company may be done- (a) By resolution of the company in a general meeting, or (b) By a resolution of a meeting of any class of members of the company, may be done, without a meeting and without and without any previous notice being required, by resolution in writing signed by or on behalf ofall the members of the company who at the date of the resolution would be entitled to attend and vote at such meeting: Provided that, nothing in this section shall apply to a resolution under section 193(1) removing a director before the expiry of his period of office or resolution under section 170(1) removing an auditor before expiry of his term of office" He further submitted that this suit was filed without having the company's body resolution, rendering this suit incompetent. The remedy is to strike out the plaint from the Court record. He bolsters his submission by citing the cases of New Life Hardware and another vs. Shandong Locheng and two others, Commercial Case No. 86 of 2022 (HC- Commercial Division) and Oxley Ltd vs. Nyarugusu Mine Co. Ltd and another, Commercial Case No.14 of 2022, (HC- Commercial 5 Division), where the Commercial Court struck out the suit for being filed without Board resolution of the company authorizing the filing of such suit. Furthermore, he submitted that the position also was clearly determined by the Court of Appeal in the cases of; One, Ursino Palms Estate Ltd vs. Kyela Valley Foods Ltd, Civil Application No. 28 of 2014 (unreported), where it was held that; '...in the case of Bugerere Coffee Growers Ltd v Sebaduka and another[1970] EA 147 which was cited with approval by this Court in the case of Pita Kempap Ltd v. Mohamed LA Abduihussein, Civil Application No. 128 of 2004 (unreported) the High Court of Uganda held that: "When companies authorize the commencement of legal proceedings a resolution or resolutions have to be passed either at a company or Board of Directors' meeting and recorded in the minutes..." Two, Simba Papers Converters Ltd vs. Packaging and Stationery Manufacturers Ltd and another, Civil Appeal No. 280 of 2017 (Tanzlii); it was held that; 6 "Having carefully considered the matter, I have reached a settled conclusion that, indeed the pleadings (plaint) should expressly reflect that there is a resolution authorizing the filing of an action. A company which does not do so in its pleadings risks itself to the dangers of being faced by any insurmountable preliminary objection as is the one at hand." In response, Mr. Muhidin submitted that the provision of Section 147 (1) of the Companies Act is not mandatorily to be performed. That law provides for discretionary power as per Section 53 (1) of the Interpretation of Laws Act, Cap 1 R.E 2015, which provides that; "Where in a written law the word "may"is used in conferring a power, such word shall be interpreted to imply that the power so conferred may be exercised or not at discretion." Therefore, he maintained that the suit was not incompetent because the provisions that were said to be contravened were discretionary. Further, Mr. Muhidin also cited Order XXV11I (1) of the Civil Procedure Code Cap 33 R.E 2019, which provides that; "In suits by or against a corporation, any pleading may be signed and verified on behalf of the corporation by the secretary or by any director or other principal of the corporation who can depose to the facts of the case." 7 And he argued that the administration of the plaintiff was aware of this matter, and the plaint had been signed and verified on behalf of the plaintiff by the company's manager, Justin William Mlacha. He added that the Civil Procedure Code, as the mother law of civil cases, is silent on the issue of resolution but gives the clear green light to an authorized company officer who can depose the facts of the case to sign and verify the pleading. Regarding the cited case of Simba Papers Converters Ltd (Supra), Mr. Muhidin stated that it dealt with the institution of a suit that revolves around the internal conflict within the company; therefore, in such a situation, the board resolution is required because that company management needs to consent on instituting a suit against one of its directors or any other officer of the company. In this matter, there is no internal conflict within the company; instead, the company is generally suing against the trespassers. Therefore, he prayed for the preliminary objection to be dismissed. 8 Mr. Enock filed a rejoinder, but I don't see the reason to summarize here what was submitted because mostly the submissions reiterated what he had submitted earlier in the submission in chief. Having considered the pleadings and the written submissions made by both learned counsel for the parties, the issue that has to be resolved are: "1. Whether the suit is improper for being fifed without the company's body resolution " In the determination, I will go straight to the recent decision of the Court of Appeal on the subject matter, i.e., the cited of Simba Papers (supra), where it was held that; "7/7 the premises, since the claimant was a company, it was not proper to institute a suit on behalf of the company without its format authority. This required the express authority by way of resolution of the Board of Directors to institute the case in the absence of which, the suit in the name of the company was defective and it ought to have been struck out". In Wellworth Hotels and Lodges Ltd vs. East Africa Canvas Co. Ltd and four others, Commercial Case No. 107 of 2020, HC- 9 Commercial Division (Tanzlii), when the Commercial Court struck out the suit for being filed without the body resolution, it held that; '7/7 my view, there is no doubt that, with the recent decision of the Court ofAppeal in the Case ofSimba Papers (supra), the dusts have been settled regarding whether a Board Resolution is a necessary document to be filed in court when a suit is instituted by a Company this being a means of evincing the authority to bring such a suit" Therefore, from the cited cases above, it is quite clear that there must be an express authority by way of board resolution to enable the company to institute the suit. Without a body resolution, that suit became incompetent. Flowing from above, it is, therefore, the submission by Mr. Muhidin that the requirement of a body resolution under section 147 (1) of the Companies Act is not mandatory because of the word "may" lacks merit because of the decision of Simba Papers (supra). Furthermore, the contention of Mr. Muhidin that since CPC, which is the mother law of civil cases, is silent on that issue and, on the other hand, under Order XXV11I (1) of the CPC, that pleading may be signed and verified on behalf of the corporation by the secretary or by any director or other io principal of the corporation who can depose to the facts of the case, is misconceived. The issue here is the body resolution to authorize the institution of the suit and not who signed the pleadings. In conclusion, since this court has no jurisdiction to hear such a suit without being accompanied by the body resolution, this suit is not competent. Further, this issue touches on the jurisdictional issues. In the upshot and conclusion, I sustain the preliminary objection that the suit is incompetent for the reasons I elaborated above; consequently, I strike out the suit with costs. I order accordingly / ' ■ ' A *- X * \ JUDGE i 25/08/2023 11