prestige investment sa vs lamar commodity trading dmccc 3 athers 2023 tzhccomd 387 8 december 2023

prestige investment sa vs lamar commodity trading dmccc 3 athers 2023 tzhccomd 387 8 december 2023

The applicant established a prima facie case by showing full payment under an irrevocable and confirmed LC, and the respondents' withholding and/or sale of the consignment was not justified. The court found that the arbitration clause did not oust its jurisdiction as no stay was sought by a party to the arbitration agreement. The requirements for an interlocutory order were met: there was a substantial issue to be tried, irreparable harm to the applicant, and the balance of convenience favored the applicant. The court exercised its discretion to grant the order to prevent the ends of justice from being defeated.

Citation
prestige investment sa vs lamar commodity trading dmccc 3 athers 2023 tzhccomd 387 8 december 2023
Parties
Applicant: Prestige Investment SA; 1st Respondent: Lamar Commodity Trading DMCC; 2nd Respondent: KCB Bank Kenya Limited; 3rd Respondent: Lake Oil Limited
Court
TZHCCOMD
Jurisdiction
Tanzania
Judgment Date
8 December 2023
Procedural Posture
Miscellaneous Commercial Application / Ruling on Interlocutory Application for Injunctive/interim Orders
Outcome
Application granted
Legal Topics
Interlocutory Injunctions, Letters of Credit, Supply Contracts, Jurisdiction and Arbitration Clauses, Fraudulent Transfer of Goods, Mitigation of Loss
Source Language
English
Commercial Law Banking Law Contract Law Interlocutory Injunctions Letters of Credit Supply Contracts Jurisdiction and Arbitration Clauses Fraudulent Transfer of Goods +1 more

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Parties

Prestige Investment SA

Applicant

Lamar Commodity Trading DMCC

1st Respondent

KCB Bank Kenya Limited

2nd Respondent

Lake Oil Limited

3rd Respondent

Procedural Posture

Miscellaneous Commercial Application / Ruling on Interlocutory Application for Injunctive/interim Orders

Legal Issues

  1. 1 Whether the court has jurisdiction despite an arbitration clause in the supply contract
  2. 2 Whether the applicant is entitled to an interlocutory order for release of fuel consignment
  3. 3 Whether the respondents' withholding and/or sale of the consignment was lawful

Ratio Decidendi

The applicant established a prima facie case by showing full payment under an irrevocable and confirmed LC, and the respondents' withholding and/or sale of the consignment was not justified. The court found that the arbitration clause did not oust its jurisdiction as no stay was sought by a party to the arbitration agreement. The requirements for an interlocutory order were met: there was a substantial issue to be tried, irreparable harm to the applicant, and the balance of convenience favored the applicant. The court exercised its discretion to grant the order to prevent the ends of justice from being defeated.

Court Disposition

Application granted

Orders

  • 1st, 2nd, and 3rd Respondents to stop continuing breach of the supply contract and LC; 1st and 2nd Respondents to forthwith release the cargo of 20,685.61 MT gasoline under the 4th Respondent's storage to the Applicant.
  • Costs of the application to be in the cause of the main suit.