jao oliveira another vs it started in africa limited another 2023 tzca 7 8 february 2023

IN THE COURT OF APPEAL OF TANZANIA

AT ARUSHA fCORAM: MWAMBEGELE. J.A.. KEREFU. 3.A. And KIHWELO, J.A.^ CIVIL APPEAL No. 186 OF 2020 JOAO OLIVEIRA 1st APPELLANT SOUL OF TANZANIA LIMITED 2nd APPELLANT

VERSUS IT STARTED IN AFRICA LIMITED 1st RESPONDENT BARAJA BERNARD KANGOMA, 2nd RESPONDENT (Appeal from the decision of the High Court of Tanzania at Arusha) (Gwae. J/l dated the 10th day of December, 2019 in Civil Case No. 19 OF 2017

JUDGMENT OF THE COURT 1st December, 2022 & 8th February, 2023 KIHWELO. J.A.: The appellants/ seek to reverse the decision of the High Court of Tanzania at Arusha (Gwae, J.) dated 10th December, 2019 which was entered in favour of the respondents. Aggrieved by the impugned decision the appellants have come before this Court by way of appeal. In order to have a clear picture of the background to the case, we deem it appropriate to closely give a historical account of this matter, which is, ostensibly, not very difficult to comprehend. The first respondent, a 1 limited liability company incorporated under the laws of Tanzania and the first appellant, entered into an oral contract upon which the first appellant became a tour and travel agent in Europe for the first respondent, and his role among others was to create a company website, social networks management and online marketing. It was further agreed by the parties that, they would share equally gross profit arising from the tour business and that each of them was to take care of office expenses in Tanzania and Portugal respectively. It occurred that, the first appellant while preparing a website for the first respondent, he remained with all user rights and privileges for the website, domain name and hosting including passwords, and was solely controlling all social networks and online marketing for the first respondent. The

first respondent, maintained bank accounts with Barclays Bank and Equity Bank in Tanzania which were meant for receiving money for clients' bookings but for practical purposes, it was mutually agreed that the first appellant open a Pay Pal account in Portugal with sole mandate as the only signatory, and that the account was meant for receiving clients' advance deposits for travel booking to Tanzania. Consequently, the first appellant started receiving clients' deposits through Pay Pal account, but quite unfortunate, and for an obscure cause the first appellant did not send money 2 to the first respondent who incurred expenses for receiving and hosting clients who were sent to Tanzania from Europe by the first appellant. It is further stated that the first appellant blocked the first respondent from accessing her website and refused to surrender to the first respondent password and other credentials, as a result, the first respondent was unable to access and control the website. The first appellant is also alleged to have incorporated in Tanzania the second appellant as a limited liability company dealing with tour and travel business just like the first respondent which has occasioned significant decline to the first respondent's clientele level as the first appellant is said to have been misleading clients through website and social media into believing that the second

appellant is a sister company to the first respondent. In the aftermath, the first and second respondents retaliated by jointly suing the first and second appellants before the High Court claiming among other things payment of USD 285,863.60 being money the appellants have been withholding from 2015, general damages and interest. In their joint written statement of defence the appellants gallantly refuted the claims by the respondents. At the height of the trial on 10th December 2019, as the judgment bears out, the High Court entered judgment in favour of the respondents, 3 and the respondents were awarded USD 285,616.60 as the amount of money withheld by the first appellant, USD 20,000.00 as general damages for misuse of the first respondent's website, interest at the rate of 7% from the date of judgment to the date of payment in full and costs of the suit. The appellants presently seek to overturn the decision of the High Court through a memorandum of appeal which is comprised of seven points of grievance, namely: 1. That, the Honourable trial Judge erred in law and fact by awarding the amount o f USD. 285,616.60 to the respondents as amount alleged to have been withheld by the 1st appellant, the amount which was neither pleaded in the respondents'Plaint nor proved by the respondents in the documentary evidence or the evidence o f PW1 and PW2; 2. That, the Honourable trial

Judge erred in law and fact for failure to properly evaluate the evidence on record and find that the respondents failed to prove that the 1st appellant received the alleged amount o f USD 285,863.60 through Pay Pal as proof o f existence o f debt as claimed by the respondents in their Plaint; 3. That, the Honourable trial Judge erred in law and fact in awarding the amount o f USD 20,000.00 as general damages to the respondents for the alleged misuse o f the 1st respondent's website without any justification o f the existence o f the 1st respondent's website and proof of damage claimed to have been suffered by the respondents; 4 4. That, the Honourable trial Judge misdirected himself on the evidence on record and held that exhibits PEI, PE2 and PE3 proved the respondents' claim o f USD 285,616.60 as a result of the respondents'business interference by the second appellant; 5. That, the Honourable trial Judge erred in law and fact for the failure to properly evaluate the respondents'evidence on record and find that the respondents failed to prove which o f the alleged customers paid the awarded amount o f USD 285,616.60; 6. That, the Honourable trialJudge erred in law and fact for the failure to properly evaluate the evidence on record and find that the first respondent did not prove the nature and type o f business relationship that existed between the first appellant and the

first respondent; and 7. That, the Honourable trialJudge erred in law and fact for the failure to properly evaluate the appellants'written submissions on No Case to Answer in connection to the basic principles established under section 110 and 111 and 112 o f the Law o f Evidence Act [Cap 6 R.E. 2002]. At the hearing of this appeal on 1st December 2022, the appellants were represented by Mr. Robert Mgoha George, learned counsel while the second respondent who is also the Principal Officer of the first respondent appeared representing himself and the first respondent. Mr. George prefaced his submission by praying to abandon the sixth ground of appeal and adopted the written submissions which were earlier on lodged in Court 5 in terms of rule 106 (1) of the Tanzania Court of Appeal Rules, 2009 (the Rules) and highlighted few issues in support of the appeal while Mr. Kangoma prayed to adopt the written submissions which were earlier on lodged in Court in terms of rule 106 (7) of the Tanzania Court of Appeal Rules, 2009 (the Rules) without more. However, we hasten to remark that, we will not recite each and every fact comprised in the submissions but we can only allude to those which are conveniently relevant to the determination of the matter before us. Arguing in support of the first ground of appeal, Mr. George contended that the respondents through the Plaint they filed in the

High Court they were claiming USD 285,863. 60 as debt owed referring to paragraphs 7 and 10 of the Plaint and that there is nowhere in the Plaint or testimonies of PW1 and PW2 as well as documentary exhibits where the amount of USD 285,616.60 were stated. Therefore, the learned counsel beseeched us to invoke the provision of section 36 (1) (a) of the Rules, and re-appraise the evidence on record in order to ascertain whether the learned trial Judge was right to award the amount of USD 285,616.60. He paid homage to the case of Leopold Mutembei v. Principal Assistant Registrar of Titles, Ministry of Lands, Housing and Urban Development and Attorney General, Civil Appeal No. 57 of 2017 (unreported), Kenya Ports 6 Authority v. Kuston (Kenya) Ltd [2009] 2 EA 212, Scott v. Brown Doering, Mcnab and Company (3) [1892] 2 QB 724 and Geisman v. Sun Alliance and London Insurance Ltd and Another [1978] 1 QB 383 to facilitate the appreciation of his proposition. Mr. George went further to argue that, the respondents did not prove their case as they claimed and instead the learned trial Judge went ahead to grant reliefs not prayed for in the Plaint contrary to the dictates of the law. Reliance was placed on section 110 of the Evidence Act [Cap 6 R.E. 2002] (the Evidence Act) as well as the case of Abbas Ally Athuman Bantulaki and Another v. Kelvin Victor Mahity, Civil Appeal No. 385 of 2019

at pages 15 and 16 and North Mara Gold Mine Limited v. Emmanuel Mwita Magesa, Civil Appeal No. 271 of 2019 at pages 17 and 18 (both unreported). Arguing in support of the second ground of appeal, Mr. George contended that, the learned trial Judge did not properly evaluate the evidence on record, otherwise he would not have come to the conclusions that the respondents proved that the first appellant received the amount of USD 285,863.60 from the alleged customers. Illustrating, the learned counsel argued that, the evidence of both PW1 and PW2 did not prove that the first appellant received the said amount. He referred us to pages 7, 8, 7 192,196,197 of the record of appeal as well as section 111 of the Evidence Act and urged us to re-evaluate the evidence on record in particular the testimonies of PW1, PW2 and exhibits PI, P2 and P3. To facilitate an appreciation of his proposition, he further cited to us the case of Ndiritu v. Ropokoi and Another [2005] 1 EA 334 and rounded off by submitting that there was no evidence to meet the threshold provided for under section 110 (1) of the evidence Act. In support of the third ground of appeal, Mr. George argued that the Plaint did not state anywhere the existence of the first respondent's website and that even if there was an issue of damages the respondents never pleaded anywhere and that the learned trial Judge failed to

distinguish between general and specific damages citing the case of Tanga Saruji Corporation v. African Marble Co. Ltd [2002] 2 EA 613. Elaborating further, Mr. George went on to discuss at considerable length that neither special nor general damages were pleaded and proved by the respondents and therefore, the learned trial Judge erroneously awarded USD 20,000.00 for the alleged misuse of the first respondent's website and without any justification. The learned counsel, referred us to pages 180 to 206 of the record of appeal and cited the case of Siree v. 8 Lake Turkana El Molo Lodges Ltd [2000] EA 521 and Anthony Ngoo and Davis Ngoo v. Kitinda Kimaro, Civil Appeal No. 25 of 2014 (unreported) to buttress his argument. In support of the fourth ground of appeal, the learned counsel reiterated and argued at a considerable length what is stated in support of ground number one in that there is nowhere in the respondents' Plaint where the amount of USD 285,616.60 against the appellants is stated. Illustrating further, he argued that, even PW1 and PW2 as well as exhibit P2 did not support that claim. He referred us to the earlier cited cases of Leopold Mutembei (supra), Kenya Ports Authority (supra) and sections 110 (1), (2) and 111 of the Evidence Act and zealously argued that there is no evidence on record to support that the first appellant received and later withheld all the

monies claimed by the respondents and therefore, the claim is mere speculation. As regards the fifth ground of appeal the learned counsel faulted the trial court for finding that the amount of USD 285,616.60 was a debt against the first appellant for money allegedly to have been withheld by the first appellant while the respondents did not prove which transactions through Pay Pal account was paid by which customer. He went on to submit that, even exhibit P2 did not show any amount that was paid to the first appellant. 9 In his further submission the learned counsel contended that, the respondents did not prove their case against the appellants at the standard required by the law and he cited a passage from Sarkar's Law of Evidence, 18th Edition, M.C. Sarkar, S.C. Sarkar and P.C. Sarkar, at page 1896 in support of his proposition. Finally, the learned counsel in support of ground seven of the appeal zealously argued that the learned trial Judge erred in his failure to evaluate the appellants written submission and went further to submit at considerable length what was argued in the appellants submission of no case to answer which for reasons to be apparent later it should not detain us much at this juncture. On the adversary side, the respondents were very adamant and prefaced their submissions by arguing the first ground of the appeal in which they admittedly submitted that the

amount claimed in the Plaint was USD 285.863.60 but surprisingly, the learned trial Judge awarded USD 285, 616.60 which is less than the amount claimed in the Plaint and proved by evidence. The respondents argued further that, the allegations that the amount awarded was not proved by any evidence is not correct as record bears out that, at pages 191 and 192 of the record of appeal exhibits PI and P2 which are prints out of invoices as well as revenue receipts and payments 10 summary indicate the amount that was withheld by the first appellant. The respondents argued further that, exhibits PI and P2 were admitted without any objection from the counsel for the appellants and therefore cannot be heard to oppose now. In further response to the first ground of appeal, the respondents contended that, since the Court has powers under rule 36 (1) (a) of the Rules, as well as section 4 of the Appellate Jurisdiction Act [Cap 141 R.E. 2002] (AJA) we may find appropriate to exercise our revisional powers in order to revisit the evidence on record and award the appropriate amount as stated in the Plaint instead of the less amount that was awarded by the learned trial Judge. In response to the second ground of appeal, the respondents submitted that the learned trial Judge properly evaluated the evidence on record because during the trial, the respondents successfully indicated how the

appellants were indebted to the tune of USD 285,863.60 as stated in the Plaint which was received by the first appellant from the first respondents' customers through Pay Pal account and cash amount. They argued further that, exhibit PI which was tendered unopposed during the trial clearly indicated the total amount which the respondents claimed in the Plaint and referred us to pages 126 and 127 of the record of appeal. li As regards ground three of the appeal the respondents argued that the learned trial Judge rightly awarded general damages to the tune of USD 20,000.00 in accordance with the evidence on record and that the appellants admitted in their joint written statement of defence the existence of the website and that both the first appellant and the second respondents have access to both the website and social media. They referred us to paragraph 7 of the joint written statement of defence at page 72 of the record of appeal as well as exhibit P2 at pages 168 to 179 of the record of appeal and exhibit P3 at page 180 of the record of appeal. In response to ground four of the appeal, the respondents were fairly brief and submitted that, the appellants did not object to the admissibility of exhibits PI, P2 and P3 and furthermore, they did not cross examine PW1 and PW2 to discredit their probative value when the opportunity to do so presented itself. The respondents further

contended that, the appellants did not defend themselves against such allegations during the trial and instead they are trying to defend during the appeal stage. The respondents, zealously argued that exhibit P3 is a clear testimony that the first respondents misled the respondents' clients into believing that, the second appellant is a sister company to the first respondent knowingly that it is not true. 12 Submitting in response to the fifth ground of appeal, the respondents were very brief and to the point that, the learned trial Judge properly evaluated the evidence on record and came to the conclusions that the evidence on record was sufficient to prove that the appellants received money from the first respondent's customers which were not remitted to the first respondent The respondents submitted further that, the appellants did not cross examine on this aspect during trial nor did they defend themselves against such allegations during the trial and instead they are trying to defend now during the appeal stage. Finally, arguing in response to the seventh ground of appeal, the respondents were very brief and reiterated the earlier submissions on the previous grounds and argued further that the learned trial Judge assigned reasons for the decision he arrived at. In further submission the respondents argued that, the appellants admitted various claims by the respondents

in their joint written statement of defence and therefore it was correct for the learned trial Judge to arrive at the conclusions he made. The respondents distinguished all cases cited by the appellants and urged us to dismiss the appeal with costs. In rejoinder submission Mr. George did not have anything to say, except he urged us to allow the appeal. After a careful consideration of the entire record and the rival submissions by the parties, we propose to dispose the appeal generally as shall be demonstrated hereunder. Our starting point will involve a reflection of the law in relation to the powers of the first appellate court. We are fortified in this view by the provision of rule 36(l)(a) of the Rules which empowers us, as the first appellate court, to re-evaluate the evidence afresh and arrive at our own finding. In the instant appeal, the appellants have bitterly complained that the learned trial Judge did not evaluate the evidence on record before arriving at the conclusions that he did. We shall address this complaint at a later stage of this judgment when we shall invoke rule 36 (1) (a) of the Rules by re-evaluating the evidence on record. The other aspect equally important to address before we deliberate on the issues before us is in relation to the burden of proof and standard of proof in civil matters. It is a cardinal principle of law that, in civil cases,

the burden of proof lies on the party who alleges anything in his favour. We are fortified in this view by the provisions of sections 110 and 111 of the Evidence Act, which among others state: 14 "110-(1) Whoever, desires any court to give judgment as to any legal right or liability dependent on the existence o f facts which he asserts must prove that those facts exist. (2) When a person is bound to prove the existence o f any fact, it is said that the burden ofproof lies on that person, 111. The burden o f proof in any suit lies on that person who would fail if no evidence were given on either side." Ordinarily, in civil proceedings a party who alleges anything in his favour also bears the evidential burden and the standard of proof is on the balance of probabilities which means that, the court will sustain and uphold such evidence which is more credible compared to the other on a particular fact to be proved. There is, in this regard a considerable body of case law if we may just cite few, Peters v. Sunday Post Ltd [1958] E.A. 424 and Stanslaus Rugaba Kasusura and Another v. Phares Kabuye [1982] TLR 338. We also feel compelled, at this point, to restate the time honoured principle of law that parties are bound by their own pleadings and they cannot be allowed to raise a different matter without due amendments being properly made. Furthermore, the court itself is as bound by the pleadings of 15 the parties as they are themselves. For this legal position, see for instance, Barclays Bank (T) Ltd v. Jacob Muro, Civil Appeal No. 357 of 2019 (unreported) and James Funke Gwagilo v. Attorney General [2004] T.L.R.

161. In the appeal before us the appellants main complaint hinges on the issue of failure by the learned trial Judge to evaluate the evidence on record which would have led him to find that the respondents did not prove the case in the preponderance of probabilities as required by the law in particular section 3 of the Evidence Act. With respect, we are constrained to decline the energetic argument by the learned counsel for the appellants as we are decidedly of the settled view that the respondents ably proved its case through the testimonies of PW1 and PW2 who testified how the first appellant and the first respondent entered into an oral contract in which the first appellant was entrusted to create a website, host and manage it along with other social media which were meant for marketing the tour and travel business for the first respondent. The first appellant was also entrusted to open a Pay Pal account in Portugal for purposes of collecting customers' deposit for tour to Tanzania while the respondents were to host and incur expenses for the customers while in Tanzania. Our reading of the record in particular pages 190 to 203 of the record of appeal as well as exhibits PI, P2 and P3 and the impugned judgment of the trial court quite obviously, contradicts the version of the argument by the learned counsel for the appellants. This is because, records are conspicuously clear

that, the learned trial Judge was undeniably right to have arrived at the conclusions he made because the respondents discharged the burden of proof required under sections 110 (1) and (2), 111 and 112 of the Evidence Act and therefore, the complaint that the learned trial Judge did not evaluate the evidence on record has no merit. We should interpose here and observe further that, the submission by the appellants' counsel that the Plaint did not state anywhere the existence of the first respondent's website and that the respondents never pleaded anywhere damages is erroneous because the respondents stated conspicuously in the Plaint the existence of the website which was designed, hosted and managed by the first appellant and furthermore, the appellants admitted that fact in their joint written statement of defence. It is quite unfortunate that, the appellants for reasons best known to themselves elected to make a submission of no case to answer instead of leading evidence to defend themselves against allegations leveled upon them by the respondents during the trial through a host of testimonies both 17 oral and documentary and instead, the appellants are trying to defend themselves now at the appellate level for something they ought to have challenged during trial through cross examination and leading evidence to prove to the contrary. In our humble view the appellants

defence has come at the eleventh hour and therefore cannot be heard. As to what transpired during the trial of the case which led to the impugned decision, we wish to let the record of appeal, at pages 203, 204 and 268 speak for itself. At page 203 of the record of appeal the following is what transpired; Mr. Robert: I am intending to submit a no case to answer. Mr. Mjema: I have no objection. Court: A submission o f no case to answer if need arises be made by 26.06.2019. Furthermore, at page 204 of the record of appeal the following transpired; Mr. Robert: We prefer this matter, a submission of no case to answer be argued by way o f written submission. Mr. Mjema: I have no objection. Court: Leave granted, the parties' written submissions shall be filed as follows; 1. The defendant by 3/7/2019 2. Plaintiff's written submission by 10/7/2019 3. Rejoinder, if any by 17/7/2019 18 4. Mention on 25/7/2019 And, at page 268 of the record of appeal the appellants stated in part of their submissions; "2. Conclusion Your Lordship, the pointed position o f the law, authorities and arguments in this submission o f no case to answer, answers the framed issues no. 1, 2, 3, 4 and 5 in this suit negatively, and that, the Plaintiffs have not established a case against the defendants and that the Plaintiffs' case should be dismissed accordingly. I humbly submit" Quite clearly, the excerpts above

indicate in no uncertain terms that the appellants believed that the respondents did not make any case plausible of any explanation worth of defending and that is why, the appellants believed that the submission of no case to answer adequately answered the five issues which were agreed by the parties and recorded by the trial court as they appear at page 189 of the record of appeal. On the strength of the above, we believe that the learned trial Judge sustained andupheldthe respondents' evidence which to him appeared more credible and bearing in mind that the appellants did not lead any evidence other than generally alleging that the respondents did not establish their case. 19 As regards the complaint in relation to the failure to evaluate the written submissions, in our considered opinion, the arguments by the appellants although may sound impressive, but sadly this was not borne out by the evidence on record as clearly indicated in the excerpts above, the appellants elected not to lead any evidence and instead made a submission of no case to answer and so, whatever point which was canvassed by counsel it was made in their submission and not on evidence and therefore, one cannot evaluate submissions but rather evaluation has to be done on the evidence on record. It is now settled that as a matter of general principle submissions by counsel are not evidence. There is a chain

of authorities in this regard, see, for example, The Registered Trustees of the Archdiocese of Dar es Salaam v. The Chairman of Bunju Village Government and Others, Civil Appeal No. 147 of 2006 (unreported), when faced with analogous situation we stated that: "With respect however, submissions are not evidence. Submissions are generally meant to reflect the general features o f a party's case. They are elaborations or explanations on evidence already tendered. They are expected to contain arguments on the applicable law. They are not intended to be a substitute for evidence." 20 In the circumstances above, there was no way the learned trial Judge could have evaluated the written submissions by the appellants however convincing they are, because submissions are not a substitute for evidence. Next, we will deliberate on the complaint that the learned trial Judge erred in awarding the amount of USD 20,000.00 as general damages for the misuse of the first respondent's website. Whereas the learned counsel for the appellants argued that the learned trial Judge awarded general damages which were neither pleaded nor proved, the respondents argued and rightly so in our mind that, the appellants admitted in their joint written statement of defence that they jointly used the website with the first respondent. In any case general damages are awarded at the discretion of the court.

Lord Macnaghten in Bolag v. Hutchson [1950] A.C. 525 laid down what we accept as the correct statement of the law that general damages are:- "...such as the law will presume to be the direct, natural or probable consequence o f the action complained of." Damages, generally, are: - "That sum o f money which willput the party who has been injured, or who has suffered, in the same position as he would not have been if he has not sustained the wrong for which he is now getting 21 compensation or reparation. See, Lord Blackbun in Livingstone v. Rawyards Coal Co. (1850) 5App. Cas. 25 at page 39." Asquith, C.J. in Victoria Laundry v. Newman [1949] 2 K.B. 528 at page 539 said damages are intended to put the plaintiff "...in the same position, as far as money can do so, as if his rights have been observed." Now the question is whether the learned trial Judge was justified in awarding the amount of USD 20,000.00 as general damages. The answer is definitely in the affirmative and the reason is not farfetched. According to the evidence on record general damages was for misuse of the first respondent's website as well as stealing the first respondent's customers which was proved through the evidence of PW1, PW2 and exhibit P3. Since general damages are awarded at the discretion of the court, in our considered opinion the amount of USD 20,000.00 awarded by the learned trial Judge is fair in

the circumstances of the case. We therefore, find considerable merit in the submission by the respondents. Before we take leave, we wish to observe that in our re-evaluation of the evidence on record in terms of rule 36 (1) (a) of the Rules, we have observed that, the respondents claimed at the trial court USD 285,863.60 as debt owed and this is evidently clear at paragraphs 5 and 29 of the Plaint, 22 the evidence on record in particular the testimony of PW1 and PW2 as well as exhibit PI and exhibit P2 proved that amount, but unfortunately, the learned trial Judge awarded the amount of USD 285,616.60 without assigning any reason for awarding that amount which is less of what was pleaded and proved. This Court in the case of Zuberi Augustino v. Anicet Mugabe [1992] TLR 137 at page 139 had an opportunity to express though not comprehensively that: "It is trite law, and we need not cite any authority, that special damages must be specifically pleaded and proved. " The question then is whether the special damages of USD 285, 863.60 were specifically pleaded and proved. As we earlier on stated paragraphs 5 and 29 of the Plaint, the respondents clearly claimed for special damages and PW1, PW2 as well as exhibits PI and P2 proved that amount but strictly speaking, the learned trial Judge awarded an amount of USD 285, 616.60 without assigning any reason. In the circumstances above, we adjust the amount of USD 285, 616.60 which was earlier on awarded by the trial court to USD 285, 863.60 which was pleaded and proved. 23 In view of the foregoing position, and save for the amount of special damages which we have adjusted, we find no merit in the appeal. Consequently, we dismiss it with costs. DATED at DAR ES SALAAM this 6th day of February, 2023. J. C. M. MWAMBEGELE

JUSTICE OF APPEAL R. J. KEREFU

JUSTICE OF APPEAL P. F. KIHWELO

JUSTICE OF APPEAL The Judgment delivered this 6th day of February, 2023 in the presence of Mr. Robert Mgoha counsel for the Appellant and Mr. Fortunatus Muhalila counsel for the Respondent, is hereby certified as a true copy of the original. 24