prestige investment sa vs lamar commodity trading dmccc 3 athers 2023 tzhccomd 387 8 december 2023
- Citation
- prestige investment sa vs lamar commodity trading dmccc 3 athers 2023 tzhccomd 387 8 december 2023
- Status
- Judgment
- Jurisdiction
- Tanzania
- Court
- TZHCCOMD
- Decision
- 8 December 2023
- Posture
- Miscellaneous Commercial Application / Ruling on Interlocutory Application for Injunctive/interim Orders
- Language
- English
More details
- Court
- TZHCCOMD
- Decision
- 8 December 2023
- Posture
- Miscellaneous Commercial Application / Ruling on Interlocutory Application for Injunctive/interim Orders
- Language
- English
On this page
Professional case brief
Research organized from the available case record
01
Holding and result
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.
02
Material facts
Parties
Prestige Investment SA
Applicant Counsel: Mr. Seni MalimiLamar Commodity Trading DMCC
1st Respondent Counsel: Mr. Godwin Nyaisa, Mr. Stephen AxwessoKCB Bank Kenya Limited
2nd Respondent Counsel: Mr. Nuhu MkumbukwaLake Oil Limited
3rd Respondent Counsel: Mr. Gaspar Nyika, Mr. Thobias Laizer, Mr. Eliolot BonifaleAmounts and remedies
- Fuel Consignment Subject to Order: MT 20,685.61
- Letter of Credit Total Amount: USD 60,000,000
- Payments Made for Last Consignment: USD 35,000,000
- 4th Respondent's Claimed Set Off (invoices): USD 1,622,321.89
- Daily Demurrage (as Alleged): USD 50,000
03
Procedural history
Posture
Miscellaneous Commercial Application / Ruling on Interlocutory Application for Injunctive/interim Orders
04
Questions and positions
Legal issues
- 01
Whether the court has jurisdiction despite an arbitration clause in the supply contract
- 02
Whether the applicant is entitled to an interlocutory order for release of fuel consignment
- 03
Whether the respondents' withholding and/or sale of the consignment was lawful
- 04
Whether the applicant has established the requirements for an interlocutory injunction
Party arguments
- Applicant
- Applicant argued that it fully paid for the fuel consignment under an irrevocable and confirmed Letter of Credit, and that withholding and/or sale of the consignment by the respondents was unlawful and caused irreparable loss. Applicant contended that the LC was revolving, cumulative, and all payments were made, with supporting SWIFT advices and bank confirmations. Applicant further argued that the alleged sale to the 4th Respondent was not disclosed, was potentially fraudulent, and contrary to regulatory requirements. The application was necessary to mitigate ongoing losses and prevent further breach.
- Respondent
- Respondents argued that the application was overtaken by events as the consignment had already been sold to mitigate losses due to applicant's delayed payments and failure to reinstate the LC. They contended that the orders sought were final, not interlocutory, and would prejudice the main suit. Respondents maintained that full payment security was not provided at the material time, the LC had expired, and the applicant was in breach. The 4th Respondent raised jurisdictional objections based on the arbitration clause and asserted a right of set-off for unpaid hospitality services.
05
Court’s reasoning
Legal principles
- 01
Civil Procedure Code, Cap.33 R.E 2019, s.68(e)
Court's discretion to grant interlocutory orders to prevent ends of justice from being defeated under section 68(e) CPC.
- 02
Attilio v. Mbowe [1969] HCD 284
Requirements for interlocutory injunction: prima facie case, irreparable injury, balance of convenience.
- 03
Arbitration Act, Cap.15 R.E 2020, s.15; Scova Engineering S.p.a v. Mtibwa Sugar Estates Ltd & 3 Others, Civil Appeal No.133 of 2017 (CAT)
Arbitration clause does not oust court's jurisdiction unless a stay is sought by a party to the arbitration agreement.
- 04
UCP 600; contract and banking law
Irrevocable and confirmed letters of credit provide firm payment security and are not subject to unilateral modification during validity.
06
Ratio, limits and disposition
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.
Obiter and limits
- The alleged sale of the consignment before discharge and without disclosure may constitute a fraudulent act, which cannot be sanctioned by the court.
- The 4th Respondent's set-off claims should be addressed in the main suit, not by interlocutory order.
- The existence of an arbitration clause does not automatically deprive the court of jurisdiction unless proper procedure is invoked.
Court disposition
Application granted
- 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.
Source and reliance status
TZHCCOMD · 8 December 2023
This page organises the available record for research. Confirm quotations, current status, and subsequent treatment against the official source before relying on the case.
Judgment reading view
Judgment text
The complete available source text.
TZHCCOMD
Judgment· 8 December 2023
IN THE HIGH COURT OF THE UNITED REPUBLIC OF
TANZANIA (COMMERCIAL DIVISION) AT DAR-ES-SALAAM MISC. COMMERCIAL APPLICATION NO. 164 OF 2023 PRESTIGE INVESTMENT SA....,..................... ......... .APPLICANT
VERSUS LAMAR COMMODITY TRADING DMCCC........ Xs7 RESPONDENT KCB BANK KENYA LIMITED........... X.......X..J^W^™DENT LAKE OIL LIMITED :TH RESPPONDENT Last Order: 09/11/2023 Date of Ruling: 08/12/2023
RULING
NANGELA a dispute over Burundi petroleum ^odujts suft^ies transaction. The Applicant is aggr^^S%^th^^ndJ^of the 1st and 2nd Respondents which led t^the with^pldfbg of imported petrol fuel product destined to the Republic gf Burundi under a contract of supply between the Applicant and the 1st Respondent. It is alleged as well that, the consignment was sold to the 4th Respondent while the Applicant had discharged her payments obligations under a Letter of Credit which was issued by the 3rd Respondent in favour of the 2nd Respondent. The applicant preferred her application to this court by way of chamber summons preferred under Section 68 (e), Order XXXVII Rule 2 (1) of the Civil Procedure Code, Cap.33 R.E 2019; Page 1 of 56 Section 2(3) of the Judicature and Application of Laws Act, Cap.358 R.E 2019, Rules 10 (b) and 1.1 of the High Court (Commercial Division) Procedure Rules, GN.No.250 of 2012 (as amended). The chamber summons contains the following prayers: 1. That, this Honourable Court be pleased to issue an order for the 1st, 2nd, and 3rd Respondents to stop their continuing breach of the SBp^ly Nimfura Lee Cewis, a resident of Bujumbura Burundi and a Principal Officer of the Applicant. The Applicant also filed a certificate of extreme urgency on the 23rd of October 2023 advancing five solid grounds regarding why this court should urgently hear and determine this
application. Noting the urgency involved in the matter at hand, this court scheduled its hearing and invited the parties on the 31st of October 2023. However, this court had to deal with a few preliminary matters Page 2 of 56 and prayers, after which a unanimous position was agreed upon, and the parties were ordered to appear for an oral hearing of the matter on the 3rd day of November 2023. Even so, the matter could not take off on that date but did take off on the 8th day of November 2023. On the material date, Mr. Seni Malimi, a learned advocate appeared for the Applicant. Mr. Godwin Nyaisa and Stephen Axwesso also learned advocates appeared for the 1st Respondent while Mr. Nuhu Mkumbukwa, a reamed advocate, appeared for the 2nd Respondent. The S^R^sporfd^nt enjoyed the services of Mr. Gaspar Nyika, aXarneb^fe^ while Mr. Thobias Laizer and EliolotKjBonifale. flamed advocates % appeared for the 4th R^pon&^t. \ X \ " Submitting in |upport ofXfie flyers contained in the chamber summof^, Malirr^d<?|ted the contents of the supportingj^ffib^vit Igd Xa^J^avit filed in reply to the X I \ Respondent^c^Mg" ^davits as forming part of his submission^ craef. Mr^Malima argued that this application ( \ \ should. be graced %s prayed having been premised under X 1 section o^e), Qtder XXXVII Rule 2 (1) of the Civil Procedure Code, Cap.33 R.E 2019, section 2 (2) of Judicature and Application
of Laws Act, Cap.533 R.E 2019 and Rules 10 (b) and 11 of the High Court (Commercial Division) Rules, 2012 (as amended). Mr. Malimi submitted that; this application was filed as an effort to mitigate the losses which the Applicant continues to incur due to failure on the part of the 1st Respondent to supply Page 3 of 56 the cargo which the Applicant has already fully paid for. He claimed that the losses would be too huge if the Applicant is to await until the main suit which is pending before this same court is heard and determined as there is presently a continuing breach. It was Mr. Malimi's submission that, although the third and the fourth Respondents were initially joined in this application as necessary parties, that status does not apply to the fourth Respondent anymore based on theT^cts disclosed in the counter affidavit filed by the 1st Respolhdjent which is>) the effect that the larger portion of the^nsigft^ffWa^sftl to the 4th Respondent. He submittM^that, pbr the Annexure % \ \ PISA-3, the Applica^andX^e X* Resident concluded a Supply Agreement forjthe supply^f pe^leum products. Mr. Malimftgjd Bys court^at^s security for the supply, the Applicant^p'pjied V©£ alH^ecable Letter of Credit (LC), in favour of tfiez 2jLDefeitent. The same was attached as Annexure I^CSA^ to the supporting affidavit. According to him, tl|e LC was^suetl by the Bank of Burundi (as the
"Issuing Bank")%.gd jjfnfirmed by the 3rd Respondent (as the "Confirming Bank"). He told the court that the terms and conditions of the LC were clear, and the most relevant term and condition is the one captured under Field 40A - indicating that the LC was "Irrevocable". He submitted that under Field 49 it is clearly indicated that the LC was "Confirmed", and the 3rd Respondent is shown under Field 53A to be the "Reimbursing Bank" Page 4 of 56 He submitted that, under field 47A- 3, the total amount to be drawn under the LC arrangements is US$ 60 million. He contended that under the arrangements, the LC was to be reinstated based on a new request upon final settlement. He argued that as per Field 47-A-3, the LC was revolving and 5 cumulative. He submitted that Field 47A-3 of the LC should be read with Field 43-B which allowed "Partial Shipment". According to Mr. Malimi, the shipment of the consignment was not meant to be for all US$ 60 million but\ljowed a partial % shipment to the maximum of US$ 60 an&^he was issued and confirmed. He argued th^t fro^^mWio^n^t of its issuance, the 1st and 2nd Res^<ndpQts^er^secured for their shipment to the Applicant. '\% Mr. Malimi submitted thanas shpwn in the Applicant's supporting affida^ paymlhj made outside the LC arrangement^, hlnpe^^^dsons stated in the 1st and 2nd Respondents^owe^affidtyit as their basis for withholding the release of
the Cchgo aretmfounded considering that the LC is \ 'X \ ""Irretycab/d’ ari^ ""Confirmed'. He argued that they have never % J been a ISM^ofj^instatement of the LC to meet the payment requirements as contended in paragraphs 7(a), (b), (c), and (d) of the 1st Respondent counter affidavit or paragraph 16,17,18, up to 29 of the 2nd Respondent's counter affidavit. He submitted further that, since the LC was irrevocable and confirmed, the issue that there was no reinstatement of the LC to provide cover to the consignment cannot arise and full payments were made. To back up his submission reference was Page 5 of 56 made to various SWIFT Payment Advice attached to as Annexures PISA-6D, C, D, and E, showing how payments were made to the confirming bank. According to Mr. Malimi further to that is the confirmation from the Managing Director of the confirming bank KBC Burundi, attached as Anriexure PISA -7 which are emails confirming that the LC was fully paid to the tune of UD$ 60 million. He told this court that the KCB- Burundi is the originator of the LC and as Annexure PISA-7 which is the email dated 04/10/2023 indices, the US$ 60 Mr. Malimi submitted thfWte tairihtor of the LC does \ "\ \ confirm to be paid whcwlse^n qte^stionWe argued that the duty to follow up on t|e money v&£h tfhjr respective bankers is of the 1st and 2n^espqndents5lt wls his submission that the 3rd Respon^^h^
onf^a bank" but has a robust role becausK it A^ed its guarantee and that, as a reim|ursing%^nK^: also rfi'ust pay. He argued that the Applicant has n^squabbl^ wfth the 3rd Respondent as such, but the 1st and 2nd k^go^nts have to follow up the matters with their bankers properly. He submitted that, in the reply to the 1st and 2nd Respondents' counter affidavit, there is attached thereto as annexed as Annexure PISA -R-4, a SWIFT Payment Advice dated 27/09/2023, from the Bank of Burundi to the 3rd Respondent. Expounding further on Annex. PISA-R-4, he maintained that this annexure summarizes all payments made Page 6 of 56 to the tune of US$ 60 million. He argued that the same asks for confirmation and the reference thereto is a reference to the LC under consideration as the US$60 Million was for the entire LC. Mr. Malimi pointed out the payments made on 22/08/2023 and 15/09/2023 noting that these payments sum up to a total of US$ 35 million as the last batch of payments made by the Applicant. He contended that, in the meeting whose minutes are attached to the 1st Respondents counter affidavit as % Annexure LCT-12, the Applicant was not a p^rty thereto, but the meeting involved the 1st RespondeX^tbg 3rd^espo^dent, Burundi Oil Product Commission, tti^Bank^^Sha^J^nd M/s Nisk Capital Ltd. X \ % \ Relying on Ani^urt^CT^Z, fSHhgued that, though the Applicant was not|a party to^je feting,
it can be dearly shown that the jfe^mSgts werX^ecbived. He submitted that, under page^^^ of thp ^tny^rfhere is an acknowledgement % % X of the two p^ymejt^madkon 22/08/2023 and 15/09/2023 all '"'W of vfiich ^e ^eceiveJ' by the 3rd Respondent (KCB). He I \ \ submi^ed that; ^uchpayments corroborate the SWIFT Payment Advice 23. According to Mr. Malimi, during the meeting to which the Applicant was not a party, it is shown that the 1st Respondent raised the issue of reinstatement but there was a disagreement as to what really that meant. He argued that the only issue that the 1st and 2nd Respondents are clinging to even now is that the LC has not been reinstated to allow payments. He maintained, Page 7 of 56 however, that, since the payments have been effected there is no need for reinstatement. Mr. Malimi submitted further that, in any case, Field 47A of the LC had provided that, reinstatement could be done upon final settlement, meaning that, one must have supplied and now convenes for a final settlement of the accounts and the reinstatement was upon a new request by the Applicant. He argued that, under the LC UPC-600 literature, and % reinstatement is about a "renewal" and VHjere the LC is revolving and cumulative, it means tha^dn^doe^otnped to go for a new LC whenever he/she Jogs fo'^^Wsl^pment. He maintained that it is only upW^tel S^ttleteent as per Field % \ \ 47A-2 of the
LC. \ \ " Mr. Malimi sulynitted further fi^t, the allegation that there is no securft^ prided fo^y%ie Applicant to cover the supplies is nb^-sfe^x?^ noted that there have also been raised ^jicefas,thartbe LC has expired since under Field 31Dfof the%C, the samAvas to expire on the 3rd of September t \ \ 2023.^1e submitted that what that fact entails is that the LC was to A^to^fri end by the time there was paid the US$ 20 million and that, on the 15th day of December 2023 more monies went in. Mr. Malimi submitted that the expiration of an LC does not prevent payments of suppliers who have supplied within the validity dates of the LC. He maintained that; in any case, the beneficiary is at liberty to apply for an extension to enable payments to be processed. He argued further that, the payment Page 8 of 56 of US$ 35 million was made to meet the obligations but the Applicant has not received the fuel consignment, and the monies paid have not been refunded. He argued that the expiry of the LC cannot hinder the release of the consignment. Mr. Malimi submitted further that, the other issue for consideration is the unfortunate allegation made in paragraph 9 of the 2nd Respondent's counter affidavit and Annex,N-6, to the effect that, the consignment is no longer available as it was sold to other buyers to mitigate alleged damac^ and costs. He submitted that the facts present an
unfbjwggte sltyatiysince the endorsement of the Bill of Ladi^(BL)^^^mSM^-6) shows that the consignment was deli^r^tcX^e^th Respondent on the 7th of July 2023^ ddt^ wh^n thMBL was endorsed. According to Mr. Malimi, thatN§ reason why the 4th Respondent has nb|sa^anythftgjn^espect of that matter. Mr.^®h^ub^%tted^g^ie information that the cargo was sold came tojbe Applicant's attention after he was served the JpuntefSgMgvits Kit nowhere was it divulged to the Applicant earliet| evefi though from July 2023 to September 2023 thll^wen^beveral ongoing communications between the Applicant and the Respondent. He averred that neither the 1st nor the 2nd Respondents ever disclosed such facts, although paragraph 8 of the 1st Respondent bears similar information, this being an indication that, the two were in communication. Mr. Malima submitted that, in line with Annexure PISA** R -1 annexed to the Affidavit in reply to the 1st Respondent's counter affidavit, the Vessel discharged its cargo twice at the Page 9 of 56 port of Dar-es-Salaam, first on 1st of July 2023 and second on 31st of July 2023. He stated, however, that, if the alleged sale of the cargo is anything to go by, then it would mean that the sale was done before the discharge of the cargo at the port. He submitted, however, that, in between there were communications which spanned between the months of July to August 2023 and if
the 1st Respondent knew of the sale, why did she remain silent without sharing the information with the X Applicant? "\. Mr. Malimi submitted further thaVtnstead^as it may be noted from Annexure LCT-9, the^ Res^op.dent^urported to cancel the supply contract, an J^otMjngXas ^sclosed regarding the sale of the consig^ent^ th^th ffe|onclent. He stated, however, that, there |s a comrh^ciahyivoice setting out the payment for the &^ire^onsignl^nt%ut no indication that any part there(^^^old5^e?afe^^ further that, as Annexure PISA-8 indb^teipn thb^2nd of August 2023, the Applicant invitfd the R^pondefit immediately after the Vessel had discharged the'^argt. He observed that the 1st Respondent '\ ■ replied cb/^An^xure PISA -8 on the 03rd of August as Annexure LCT-11 to the 1st Respondent's counter affidavit would show. Mr. Malimi submitted that; the letter does not show anywhere that the cargo had been sold. He further stated that on the 06th of July 2023/ 07th of July 2023, the confirming bank (the 3rd Respondent) did receive money to the tune of US$ 15 million for this last consignment as per Annexure PISA-6B of Page 10 of 56 the supporting affidavit, meaning that the consignment was allegedly sold to the 4th Respondent the same day, a fact which clearly reveals that the alleged sale borders a fraudulent conduct if at all that happens to be true. Mr. Malimi submitted that, as per the
law there is no Oil Marketing Company (OMC) permitted to import fuel outside the Petroleum Bulk Procurement Agency (PBPA). He referred to this court Regulation 14 of the Government Noticed. 193 of 2017. He argued that nowhere in the 2nd Respondent's counter affidavit is it indicated that there was^fi>^pr6^l frojn the PBPA allowing the 4th Respondent to^^fes^ me said consignment. He noted that aS^MJiegX? dfthe GN.No.193 of % X % 2017, no person is^llov^ej tb^protA bulk petroleum consignment outside fie PBPA fra^iev^k. He argued that the procurement of tlt^28X00 MT b^atbline exceeded the PBPA's % X > allowable arf&X ana^or^th^gBafter, such purported sale was illegal and cagznotfee blessed by this court. He further argued Xf. . that ft is w<M{i ffe|ing tKdt the consignment was an on-transit % % consiggment destined for the Republic of Burundi. Frbi^ thpl fact Mr. Malimi argued that one of the following two things must have happened: one, either the consignment was localized or two, that it was sold to another country. He argued, however, that, nothing has been disclosed in the 2nd or 4th Respondents' counter affidavit or supplementary affidavit and, if the consignment was localized there is a procedure which should have been followed. Page 11 of 56 Referring to Reg. 15 of GN.193 of 2017, he argued that, if a consignment was a transit-cargo there are requirements and specifications
which ought to be complied with. He submitted that if the sale happened, it was illegal and that accounts for the reasons why the 4th Respondent never commented it. Mr. Malimi argued that such conduct of short-changing a cargo destined for a neighboring country that uses the Dar-port should not be condoned by this court as it not only tarnishes the reputation and image of the Dar-es-Sala3<i Port, but also has disastrous effects on the Port's fundtidns, %% He further submitted that tfez moriles^etMo purchase the consignment were Buru^ar^ta^ye^ who now have neither the fuel north^one^As%q^arJs^e^4 th Respondent's alleged lien over th| consignment W^iich is under the 4th Respondent's culb^iy^e sub^H^tecHhat the 4th Respondent seems to^^^ixin^u^No^/as before this court no application/sbjt hlsjDeenMiled alleging adverse interest. He ""'W ' argufd that%yhbt^the cobrt has before it is a mere allegation raised^by way d| an Affidavit, while in fact, this court ought to have %be^gwg^n J the opportunity to hear the parties comprehensively and not by way of passing. He contended, however, that, the claims raised by the 4th Respondent are unprocedural as they have come to the light through a back door and should not be allowed. Mr. Malimi argued that be that as it may, in any case, the Applicant and the 4th Respondent are still doing business and there is no indication that the arrangements
they have are being Page 12 of 56 or have been terminated. He argued that, if the 4th Respondent is interested in raising a claim, then he should have come up with a counterclaim since, currently, there are no sufficient materials before this court for it to determine the alleged claims by the 4th Respondent. He submitted that the claims by the 4th Respondent-are to the tune of US$ 14.5 million while there is already paid US$ 35 million. Concerning the tenability of this application, it was Mr. Malimi's submission that the orders sought afe^liscretionary in nature and the court's discretion is to o^b^rcisMjudraously. He submitted that the case of HCD 284, should therefore be foWvedL aJu:he\trappings of this % VX\ % application are almostj^pngthf line^W an injunction. He contended that the r^uirement^vhicXwere laid down under that case are fulff^netyn this %ppli&tion. He contended that the applicarfTdqes r%yeatWj|p>us triable issue, the applicant < A X/- • is in an apparentJagger of suffering as her monies were paid but Jo fuefX^asX^ailed^Further, he contended that the loss being^rreparab^the^Applicant has brought up this application, to mitiga^guc^bss as she still stands to suffer. Mr. Malimi contended further that, even if the loss can be quantified in monetary terms since the applicant has failed to deliver to the Burundians that is a serious issue of concern to them as they
stand highly inconvenienced. He argued that the balance of convenience favours the Applicant more than any of the Respondents. He thus argued this court to grant the Applicant's prayers with costs. Page 13 of 56 Responding to Mr. Malimi's lengthy submissions, Mr. Godwin Nyaisa, the learned counsel appearing for the 1st Respondent, addressed this court by focusing on the remedy sought for payer (a) to the chamber summons. He contended that the orders sought are silent as to what will be pending if this court decides to grant them. Will the court grant such orders pending the hearing and determination of the main case? Mr. Nyaisa asked. He submitted that the praters sought are not temporary but seem to be having a permanent^ffect and could only be granted after hearing and deten^^^the^ain s^it. He argued that a look at the Plaint atbqhed ^^ife^ure PISA- 1 shows that the 2nd prayer in^fe<hanill%er Summons is akin to prayer (d) of the reliefspugnXunde^the mint. In view of thatj he argued^hangranting such an order would be tantamdbgt t&^rejudglU^ tfre main suit whose hearing is yet to conO^ce. Re cifa^Q^a that the 1st Respondent as % \ a Defendant^ th&main ^at will not be availed an opportunity to lyesent^sp^tive documentary evidence and will be condemned unfreard^ % I To^uppy: his submission, he referred to this court the cases of Isaya Mwakilasa @ Wakuvanga & 6 Others vs. East
Africa Television Ltd & ZOthers, Commercial Case 46 of 2008 (unreported) and Shaheeza Moezali Karmaii & 3Others vs. North Mara Gold Mine Limited & ZOthers, Misc. Civil Application No.203 of 2023 (unreported). He submitted, therefore, that the application before this court is Page 14 of 56 not one for a temporary but a final order and should not oe granted at this time. Mr. Nyaisa submitted as well that, to a larger extent, the application at hand has been overtaken by events. Referring to paragraph 7 (f) of the 1st Respondent's counter affidavit, he contended that, to the extent of the amount paid, the discharge was made to the Applicant as proved by Annexure LCT-6. He submitted that, regarding the portion of the cargo yet to be paid "\ for, the 1st Respondent has made it clear in he^ounter affidavit that the same was sold to off-takers to r^^^the\es^which had anchored for 81 days waiting fe^conf^^oh^^yments from the Applicant. He referr&Je^s'bquiT^nnexures LCT- 7 and LCT-8 as prooLpf t?^lle§^l safAde contended that the only cargo remain|ng is MT.4^ % Mr. Nyaisa^surhgised tfi^efSte that, apart from the remaining thK/est^o/Jbe cargo is no more, and this court should^ot lajsnticbd to grant orders which cannot be enforced. HKcoM^ndealhat, whether the sale was lawful or not ilyiot an is|ue that can be determined at this stage. He \ % argued trta^th^pplicant is at liberty to
challenge the sale and that will be an assignment for another day. As to the merits of the application, Mr. Nyaisa adopted the counter affidavit filed by the 1st Respondent as forming part of his submission. He argued that, as regards the three tests, the first being that there should be a prima facie case against the 1st Respondent, looking at paragraph 6 of the Applicant's affidavit and Annexure PISA-3, there is no doubt that the Page 15 of 56 product ordered by the Applicant was secured by LC. He submitted that in line with clause 7 of the Supply Contract, paragraph 2 of the Applicant Affidavit also states that delivery was conditioned upon full payment security. He submitted, however, that the question to be asked is whether at the time when the Vessels arrived, there was such full payment security. Referring to paragraph 10 of the Applicant's Affidavit, he argued that the same speaks of "assurance of payments" which is a completely different thing from Security Payment in favour of the LC. He concluded that what it mdaftfewas that there was none of such security at the time?Ng argu^nfe'^fajse 7 of the supply contract provides f^^^ga^e^security" and not "assurance security". H£ a^ed^iat p^fegfaph 10 of that Affidavit goes contralto what MhyvialiM stated since what was available was "^sur^ce sec%rity^and not "full payment security". Referring fc^Annexure PISA-5A of the
Applicant's Affidavit, Mf^yal^a submitted that, this letter, dated 17th June 2023%|ates tha^he Applicant was referring to "commitment for underta^M^Jo^y" meaning that the same signified lack of a full payment security. He further relied on Annexure LCT-2 attached to the 1st Respondent's counter affidavit. He noted that, with it is a letter dated 19th of June 2023 in which paragraph says that 'full security payment' was to be there sometime in May 2023. He contended that, since Mr. Malimi had submitted that by the 15th of September 2023, the Applicant had delayed paying for a full four months. Page 16 of 56 Mr. Nyaisa contended further that; paragraph 4 of the said Annexure LCT-2 was clear that there was to be discharge only when the full payment security was made. He argued that paragraph 5 of the letter had advised that despite the paying US$ 10 million, there was a need to pay US$ 25 million a payment which the letter had advised that should be hastened. Mr. Nyaisa referred to this court a Notice of Claim dated 28th of May 2023 (attached to the 1st Respondent's counter affidavit as Annexure LCT-1). He argue8%that the same reminded the Applicant of the outstandfh^p^meh^obtations yet to be fulfilled. He contend^thafr^?%a^e^nd its accompanying email and stat^e<^gf*Xco^t were in respect of the three shipmen(^4e tu^miftqd tfiSme^ 1st statement in column 6 was a full s^urity
equahto US$ 60 million. He argued that the 2nd state^en^lso inJfe|tec^a full security of US$ 60 million an^fiT^vas^ie^^O^en the LC in question was rais«* x ■ He sdb^iifi^d further that looking at the 3rd statement of accost in column 6jr there is no full payment security to the tune of iJs|^CH^IIion, meaning that there was no full payment security back in May 2023 and the Applicant never responded that there was full payment security. He queried as to why the Applicant did not state so when the claims were issued. Mr. Nyaisa referred the court to Annexure LTC-5 attached to the 1st Respondent's counter affidavit and argued that, with it is an email from the 2nd Respondent and a letter from the Shipping Line addressed to the Applicant advising the Page 17 of 56 Vessel to remain adrift due to financial hold while advising hastening of payments so that the Vessel could berth and discharge her cargo. Mr. Nyaisa argued that, as per Annexure LCT-10 of the 1st Respondent's counter affidavit, this was an email from the KCB-Burundi advising the Applicant that initially the LC was drawn for US$ 60 million and has been paid, i.e., has been utilized to the limit. He submitted, however, that, part ofJt was reinstated to the tune of US$ 25 million. He submitted th^the full LC that was utilized during the 2nd shipment b^p’io^the^ shipment was partially reinstated and for Ih^t was partially
released. Mr. Nyaisa rS^r^tS^yet Smother Annexure LCT-12 arguing that^walh^3 m^ting^tween Burundi Oil Products Commission! which wa^conVijiced after the earlier court case was wft^dra^n from^e cburt. It Nycft^a'I^ta^S’on, therefore, that, one of the agenda^s Jaymenlkso far made and Nisk Capital, the Applicant's ft^n6i^l advisor attended the meeting. He argued that,^pn page%3 8f 8, the partial payment received on % 22/05/201^aj/US$10 Million which the 1st Respondent is not disputing, and the 2nd partial payment was made on the 06th of July 2023 for US$ 15 million. He argued that the disputed payments made in August and September have no description as they did not reinstate the LC and, therefore, there was no way payments could have been made to the supplier without there being reinstatement. He argued that the instructions to reinstate must come from the Page 18 of 56 issuing bank and the 1st Respondent cannot respond as to why it did not happen. He contended that towards the end of Annexure LCT -12, there is a payment breakdown for the 3rd shipment and the last row indicates what is remaining as the available consignment which is 4350.18 MT. He argued that the Applicant was advised since 22/09/2023 to avail names of the clients for the release of the BL. Mr. Nyaisa submitted that, with all those documents it is the Applicant who is in breach and should be allowed to benefit
from its wrongs. He contended^fet^Jhe cb^um^pts do not support the view that there wls^full l^^^p^y^nt. He argued that the LC Fields wh^^^^glic^ts counsel relied on are inapplicable toThe Re^pondemas she is not the beneficiary of the L(|. He argued tn^-as per what the 1st Respondent stat^u^er parl^ap^i 6 (g) of her counter Respondent ^deliver. Commenting on Field 47A of th^LC, washof the view that, the 1st Respondent's undemanding of theLC is that full settlement would mean that the lc ti|ized- As regards the August 2023 SWIFT Advice, Mr. Nyaisa submitted that, the same never reinstated the LC and it is the Applicant who should find out with the Bank of Burundi regarding why the LC was not reinstated. He contended further that, even if it were to be assumed that there was such reinstatement, still the same would be after 4 months since the arrival of the Vessels and the 1st Respondent was not sure if the Page 19 of 56 Applicant was still committed to the LC, hence one would have expected the 1st Respondent as any reasonable supplier would do, to mitigate its losses. He submitted that the mitigations are in the sense that, the ship has arrived, the supplier has not been paid for all four months, there would be interests and demurrages which per day is US$ 50,000 as well as other incidental costs all accruing as well. He contended further regarding the role of KCB-Burundi that
she was not the conforming bank and so^ad no mandate X as the real confirming bank was KCB Kdi^a^ '\% Mr. Nyaisa argued that a loofe^t (the email form KCB-Burundi) doesSddfy better, Ind the two emails X X \ defeat each other. He^yth^^rg&e^ tharthelc was between the issuing and the confirming fta^k li^l if it expired it is the Applicant's banket Should seb^ fJf its renewal and not the Supplier's dMf^He co^en^edjtet although it has been argued C \ % that the BankW Bfcyndi h&s paid, it is for the Applicant to follow the money aKthXmonie's have never been received by the 1st t \ \ Respdpdent. \ ..also responded to the issue of sale of the consignment stating that the 1st Respondent had no cargo to sell as she would only have gotten the cargo had the 2nd Respondent been paid. He contended that what the 2nd Respondent chose to do with her cargo having not been paid, was purely her own decision which was not necessarily supposed to be revealed to the 1st Respondent who equally came to know about it in court. He argued that the legality of Page 20 of 56 the same and whether taxes were paid or not cannot be matters to determine in this application. From his submission, Mr. Nyaisa contended that no prima facie case has been made out worth of success because it is the Applicant who is in breach. To support his submission, he relied on the case of Mohamed Iqbal Haji and 3Others vs. ZEDEM
Investment Ltd & 2 Others, Misc, Land Appl. No.05 of 2020 (unreported) where it was held, inter alia that, the court's jurisdiction to interfere where a correct subsists by granting an interlocutory injunction is Impe^to c^§es where it is clear that a breach must result frim^e^acts of the Defendant. \ \ X % Mr. Nyaisa subnjjped f^rth^that it%the 1st Defendant who stands to suffer irreparable Ib^s if^ey have not been paid and could not hfv^ rStgased consignment without being paid first, wa%<eifctaX^/and no payment security was available. H^argi>±that^nce there is a release, the obvious would be tnXtliKcargo'Would be distributed to the outlets in | \ \ Burundi. He c^teri^ed that the Applicant is a resident of BujumbuTa^if^o assets in Tanzania, As such, the irreparable loss would have befallen on the 1st and 2nd Respondent had they released the cargo. He similarly submitted, concerning the third element (i.e., balance of convenience) that, once the cargo is sold, it will be difficult on the part of the 1st Respondent to get anything out of it. He thus urged this court to dismiss this application with costs. Page 21 of 56 The third submission was from Mr. Nuhu Mkumbukwa, a learned advocate for the 2nd Respondent. For him, having adopted the 2nd Respondent's counter affidavit, he chose to be associated with the 1st Respondent's counsel submission to the extent such applies to the
2nd Respondent's case. He maintained that the contract between the 1st and 2nd Respondent obliges the 2nd Respondent to deliver the cargo only when there is full payment security. Reliance was placed on paragraph 4 of % Annexure N-3 of the 2nd Respondent's counter affidavit. He % contended that in this case there were^nm^ Vessels whereby the 1st and 2nd Vessels discharged ^<hout^^feh>^2ot is the third Vessel that had issues^Mher^wak no full payment security made in respecpf it^cad^ the Wwas not reinstated. He contended fhat such J<actXstated not just by the 1st but also by th%^rd ^spontJept (the KCB-Bank). He argued that even thj^Wplicata Minexj^e PISA-7 contains an email millk|n was^n^ut nd^full payment security. He submitted therek|re that tl|e 2^ Respondent could not to have released ..thefuel%fls^ent. He further submitted that although the payment issue was a bank-to-bank transaction, there is no documentary evidence from the issuing bank (Bank of Burundi), conforming bank (KCB-Kenya), or the beneficiary bank (ABSA) showing that there was still a valid LC for the disputed consignment. He argued that the 2nd Respondent relied on confirmation from the Page 22 of 56 Bank and no such confirmation, then paragraphs 7 and 10 of the 3rd Respondent's counter affidavit apply. He maintained that the confirming bank is on a stance of denying that the relevant security has been
reinstated meaning that there was no assurance communicated to the 2nd Respondent for her to be able to release the cargo to the 1st Respondent. He submitted that the duty was to release the cargo upon a show of full payment security and not to release it to the Applicant. % a beneficiary will release it to IBM? Rbspofident, but that will only happen if the A^icant^om^ls tnWd Respondent to confirm to the 2nd |espondenXthah£here is full payment security. But Mr. l^rn^Jka wa^quicWto submit, however, that, even if th^^ffl^f KCB-(K) are not agreeing as to whethliyzhefejs fulbpayment security or not, paragraphs 9, 1|, 11, atyjz thez7nd Respondent's counter affidavit do show^hat the^par^b has been sold to other off-takers as % I AnnexuFe^-jpb the respective counter affidavit reveals. He contended that such a route was taken to mitigate the losses and damages since the 2nd Respondent purchases from other suppliers. He argued that the Applicant was notified on the 25th of May 2023 of the arrival of the Vessel and was obligated to avail the full payment security on receipt of that information. He submitted that, instead, the reinstatement was done in piecemeal and so the 2nd Respondent sold the Page 23 of 56 consignment and now there is no cargo to supply except MT 4350.38 released to the 1st Respondent. He submitted that an order to release the goods would not be contractually sound
and could not be executed as there is no more such cargo to release. He urged this court to restrain itself from issuing such an order since it has the potential to create more harm and confusion than good. To back up his submission reliance was placed on C. K. Takwani, Civil % Procedure, 6th ed, Eastern Book Companion page 331, As regards the maintainability this application, Mr. Mkumbukwa joined hands v^h Mi^z NyatAtnat, the prayers r X X made are final and no| temporaiy^andMf granted then they will do away with thefejieflg numbed (d^ (d), and (e) in the Plaint. % To suppor^^^mihl^n^^i^Hed on the case of Gulf Bard Group (Tanzania)J-td v^. Swalehe Said Mohamedi, Civil _ 'Xw. z/ . ^He contehde&Turther that the orders sought are granted by the col^aty|| discretion. He argued that the Vessel arrived in May 2023 but there was a delay of 81 days. So, if indeed the cargo was badly needed, the Applicant ought to have expedited the matter and paid the LC promptly. As regards the issue of irreparable loss on the part of the Applicant, Mr. Mkumbukwa was of the view that the loss was atonable with an award of financial damages. Page 24 of 56 As regards injury to reputation, he argued that reputation is earned and there being evidence that the security was not reinstated failure to do so has consequences that follow naturally. Moreover, he argued that throughout the Applicant's affidavit,
nowhere is it stated that the Applicant is the sole imported of fuel in Burundi. As such, he contended that no loss cannot be atoned financially. Mr. Mkumbukwa argued further that even by assuming that the cargo is still available, if the orders aMjp be granted it is the 2nd Respondent who will suffer th^argq/vould be unsecured, and the LC has lohg^ exi^^ifr^tne 3rd of September 2023. He argued ^|M^e%qjre^t application was filed after the LC had ^pireS^nd^e exp^z is a fact admitted by the Applicant in he| affidavit ih^epfX On the issit^pf Si^closur^f information, he argued that, as AnnexiyOh^ in&^te%Hte^ Respondent was constantly reminding tlH ^Respondent and the Applicant and so the z/ cons|quenc^on(ailure to supply full payment security were know^ to all^arfes, themselves being business-minded persons.^jththat, he urged this court to decline to grant the prayers sought by the Applicant. The fourth submission was from Mr. Gasper Nyika, for the 3rd Respondent. His submission was very brief. Having adopted the counter affidavit of Mr. Damas Mwangwage which was filed in this court, Mr. Nyika submitted that, the most relevant parts of the said affidavit include paragraphs 7, 8, 9, and 10 as they set out the status of the 3rd LC which, had it Page 25 of 56 been funded in full it would have secured the delivery or I shipment of the cargo, the subject of this application.
He submitted that, as paragraph 10 of the said counter affidavit shows, the LC was not fully reinstated. Mr. Nyika submitted further that as the chamber summons is seeking the release of goods that are the subject of contract, it has been pointed out under paragraph 9 of the counter affidavit of the 3rd Respondent that, as a confirming bank, the 3rd Respondent has no obligatioMjo verify or be involved with issues of performance ^sy<ch underlying contract. Rather, her obligation is^deat^^fhe^^^ments as per the terms of the LC aWwjlJ nX engage herself as to whether the cargo is the^e or^Qt. HU^ray^Jthat the application be dismissed with cos|s. The final stomil^ion came from Mr. Laizer, the learned advocate Rb^o^'^dfeMr. Laizer submitted that as a matter of ptljicide^ courts do care about the sanctity of contracts. T^ha^xtent/he referred to this court Clause 10 of the Ripply C^tra^: between the Applicant and the 1st ■ \> % Respond^^vye the two had agreed to the effect that, in case of any dispute between them, the same should be settled in London Court of International Arbitration. He contended that under paragraph 25 of the 1st Respondent counter affidavit pleaded that under the agreement it is the London Court of International Arbitration which will adjudicate the two and them being foreigners, then this court is not clothed with requisite jurisdiction to hear and determine Page
26 of 56 this matter. Aside from that preliminary concern of his, Mr. Laizer proceeded to adopt the counter affidavit filed by the 4th Respondent and the supplementary affidavit thereto as forming part of his submission. He further adopted the submissions made by the counsel for the 1st and 2nd Respondents to the extent they serve the interests of the 4th Respondents and more regarding the orders sought by the Applicant. In his submission, Mr. Laizer submittedThat as far as the applicable principle of injunctive relief i^cbn^erne^. thejarders sought are untenable. He argueS^hat/^^th^/ffio main orders are predicated on the ^p^co^ra^and the LC, they cannot be granted be^iseth| t^ins&Aents have expired. Similarly, the prayer f|r the second orcl^r is untenable because it goes contrary toMhe feal impo^ant purpose of Order XXXVII Rule 2 (1) jjO^Jivil ^ch^^e, Cap.33 R.E 2019 through which tempch^ry >jyncti^)rders are given. to m^ntain tn| status quo pending determination of a substan&V^matj^r or suit. To that extent, he associated himself with the various decisions which this court was referred to earlier arguing that granting this application will render the main suit superfluous. Mr. Laizer submitted further that the orders sought are untenable as well because the cargo itself has not been secured by the LC. He argued that the available correspondences, including Annexure N-4 to the
2nd Respondent's counter Page 27 of 56 affidavit written just two days after ^the Vessel had arrived, prove that the third shipment was not secured by LC. He averred that the letter (Annexure N-4) originates from the Applicant's agent urging the Applicant to expedite the payment process as the cargo was on a funding hold as payments were still pending. He argued, therefore, that, the Vessel delayed for 81 days. Mr. Laizer submitted as well that, regarding whether the LC was replenished or not, that is a question^) be responded to by the Bank of Burundi as the send^WjJie iM^to the KCB who act as its receiver, on behalhqf th^^^^sp^^nt. He contended that unfortunately,^e^gP^n^as chosen not to bring the Bank of Burundi i^hesX^roceAings hence putting this court in a precarious position's submitted that when such issues arise, they^vit^the apptigatfen of the UCP600 and the URR-Rules.jr% argued thaf^e Bqjrie imposes a legal duty to both the sender and ^e recei%^r confirm receipt and, in this case, reimbursement the LC amount sufficient to cover the carqo on board the Vessel. He submitted that being a legal duty, the absence of the Bank of Burundi puts the court in a difficult position to ascertain whether the payments were done to the KCB (K) or not. He contended, however, that the Applicant is to blame for not bringing on board the Bank of Burundi into these Page 28 of
56 proceedings. He urged this court to draw a negative inference against the Applicant based on such a failure. Concerning the Swift Messages claimed under paragraph 11 (c) of the Applicant's Reply to the 3rd Respondent's counter affidavit, it was Mr. Laizer's submission that, the amount alleged to have been sent was not the full payment security required. He contended that in any case the same was sent after the LC had expired contrary to Field 47A (3) of the LC which requires the presentation to be made within the validit^pf the contract. As regards the 4th Respondent's intere^s^Jr. Late-er r^ed on Annexure LO-2 to the 4th Respondent's cb^^^^daMt which are copies of hospitality agree^^ be^ee^the Applicant and the 4th Respondent. He argued thatpttached td^nne^ure LO-2 are invoices for a sum of US$%^2^21.89^l|is ^81361 being the value of dead stockJdWi^ leabqd submitted that through the agreements^<ie jLResdbadent had rendered services to the Applicant w^ut^elng paid. Besides, he contended that some % ' j of the^laims by^he z4th Respondent relate to services rendered as far bt^gsJ^irch 2023 and all efforts to demand payments have not been fruitful. Mr. Laizer submitted the Applicant has been proposing a settlement of the debts using the amount of her stock of petroleum products being kept by the 4th Respondent in its storage facility on a hospitality basis. He submitted that on
the 7th of July 2023, the 2nd Respondent availed to the 4th Respondent a list of off-takers of the 1st discharge of MT- Page 29 of 56 22/660/711 as nominated by the Applicant and raised a commercial invoice which is attached as Annexure N-6 to the 2nd Respondent's counter-affidavit for the MT-20,000 of Gasoline sold to the 4th Respondent iand that, on the 2nd of November 2023, the 4th Respondent issued a final release order confirming that a balance of 4350.18 m3 could be released to the Applicant. He submitted that, in paragraph 8^ of the Applicant's Reply to the 4th Respondent's supplementary affidavit, the Applicant does not deny there beingf^eerrfeqts far the provision of services and being indebted ^^e ?^e$ondent / it ' but that the claims require re^W^l^ti&i^ H^invited this court to consider such admission%nd %akelAorder that the 4th Respondent order seeding the rete^se Xthe fuel which is in the custody of the 4th/M^spl^dent bfefore^the statements of account are reconcitedWjj preJudicMbjybferests of the 4th Respondent X % \ and its intended dtotercIMms in the main suit. f He contended that the Applicant's position to have the 4th Respondent^ claims reconciled before the release of the 4350.18%Jwyi the 4th Respondent has, does confirm the 4th Respondent can release upon submission of the names of the Applicant's clients to the 2nd Respondent for preparation of the BL, is
indeed a welcome by the 4th Respondent who undertakes to participate in full. He noted that, as Annexure LO-2 to the 4th Respondent's counter affidavit shows, all agreements have expired and have not been renewed. He argued that the only Page 30 of 56 way the 4th Applicant can get paid is by using the Applicants fuel, the 4350.18 M3 to offset its claim after the proposed reconciliation is done. Mr. Laizer submitted further that, going by the principle stated in Attilio vs. M bo we (supra), it is the 4th Respondent who will be a plaintiff in the counterclaim that has established the existence of triable issues. He urged this court to strike a balance in a manner that the fuel belonging to the Applicant is not released until such time a substantive suit in the form of a written statement of Mr. Laizer submitted, in^w^JtePhativk that, if this court Y Y YX \ is to hold that the avajlable^350M-8 M3^dL fuel or any such r ■ % v quantity be released| then th^out^ order should direct deduction of th%^volumes s^cilnt to liquidate the 4th Responden^ffi^ms a^leM^ia-e. Mr. Laizer submitted that the ApplicanL<iasla,ised claims of fraud and has cited GN. 193 of 2(|L7 argffiqcj th|t it prohibits the sale of transit fuel to several off takers inc^din^ the 4th Respondent. He maintained, howeverNhat, tie learned counsel for the Applicant has not told this court that under Regulation 15 (1), (2),
(3), and (4) of GN. 193 of 2017 parties are allowed to procure transit volumes through the BPS System except for local volumes. He noted, however, that the only condition attached to that is to ensure that the cargo strictly complies with the quality requirements. Mr. Laizer argued that even so, the 4th Respondent does oil transit business as usual and has companies operating in Page 31 of 56 Rwanda, Burundi, Malawi, and Congo DRC, meaning that she is allowed under the law to acquire such volumes without being accused of breaching the law. He submitted that the 4th Respondent's purchase of the cargo aboard the Vessel from the 2nd Respondent was no secret but allowed under the existing law. Referring to Annexure PISA 5-D attached to the Applicant's affidavit, he submitted that on the 26th of July 2023, the 2nd Respondent wrote to the 1 % Executive Directors of the PBPA and TPA informing them of the 2nd Respondent's readiness to off-load SpH^lumt^of th£ said fuel to the 4th Respondent. HX^ubmtorfrh^, the 4th Respondent has been cited as<wtjfyifig pdrty because it was Respondent as a notifying party, h^cont^nded that the volumes are not subject td^payn^nt of tb(£sth this country unless such volumes arffelJzed^leXag^^d that there is no evidence % % to show that^e^^espd^ient localized the volumes to argue % % %Mr. Laizer contended further that evidence has been X J shown ofMjje
existence of . an agreement between the 4th and the 2nd Respondent which necessitated the communication between the two about the sale of the cargo which was not paid for by the Applicant. He argued that, after the Applicant's failure, there was nothing wrong for the 2nd Respondent to seek other buyers to mitigate her losses. Relying on Field 47A (3) of the LC, he argued that the LC provides that reinstatement of the LC crystalizes when the Page 32 of 56 maximum amount is drawn down, the maximum amount being US$ 60 million. He submitted that what was paid by the Applicant was not sufficient to constitute the maximum security required under Clause 4 of the Supply Agreement (Annexure PISA-3) to cover the costs. He argued that the Applicant is not the sole importer of fuel in Burundi. He’ thus urged this court to dismiss the Applicant's application. In his rejoinder submission Mr. I^alimi rejoined that, the I \, Applicant wish to maintain her submission in dbjef. He rejoined that, as far as the tenability of this appli^OQJs cdqferned, the same was made a part of mitigatin^e^astramth^pm of the Applicant as there is current^^^orifc^uir^ breach and the Applicant cannot sit idly*, % .X ■f X, \ Second, he argued that th§ prbyjsions upon which the application is pre^jged^re secfe^ & (e) and Order 37(2) (1) of the CPC,J^p^33 RX^OMitf^ctioh 2 (3) of the Judicature and ApgHcatto^^k^s A%^
Cap.358 R.E 2019, making this an applption th|t S^ies cfoser to an injunction. He argued that the injpry cannoj: continue to be sustained till the final suit is determiners^fgued and that this court has the power to intervene. i i Mr. Malima rejoined that, under section 68(e) of the CPC, the court can make any interlocutory order as it sees fit to prevent ends of justice from being infringed. He argued that the । Applicant has paid and there is US$ 35 njillion lying with the 3rd Respondent on account of the third consignment, the subject of this application and, that, none of the Respondents has denied Page 33 of 56 that fact. He contended that the only issue disputed is that of reinstatement of the LC. He submitted that under section 68 (e) of the CPC, where the essential fact is not defeated, the controversy becomes narrow, and the court should not allow the injury to continue. He argued that, read with Order XXXVII Rule 2 (1) of the CPC and section 2 (3) of the JALA, the court is at liberty to grant the prayers especially where there is no clear-cut position regarding I % how the injury should be contained, this being^court of justice which must come to the aid of the corri&inant. % > \ K,. (supra) and that of Shaheez^>^ra)^cgukg that these were r . \ .. cases for pure temporary injunctions' considering the prayers sought therein. He submitted tfi%| this^ cases were
premised on section 95 and^rdl^XXXvft^uTe*!1 (a) and (2) of the Civil Procedure ^f^^ap.3^f?&4Onienck they were clear cases of seeking ihj^n®^reli^as no remedy was sought under section 2(3^ jlQ, Ca^358. a^nnccihlo infj-innarr %Concerni1^j a^possible infringementant- nf the rinht- of thn right tn to ka be heard iAhj^a^ication is granted, Mr. Malimi submitted that the parties have already been afforded' time to put clear their positions and the fact that stands out is that there was LC and the payments were made for the release of the consignment, which is what the Applicant stands for. He submitted, therefore, । allegations that the Respondents will go unheard of are misplaced since the suit has other 'prayers that do not Page 34 of 56 necessarily depend on this application, reliance being placed on Annexure 4 to the Affidavit filed in support of the application. Mr. Malimi argued that, apart from the order of specific performance the rest will not be cancelled out by the order sought in the application. Concerning the argument that the Application has been overtaken by events and the reference made to Annexure LCT-6, he rejoined that the allegation is an l afterthought and that is the position held by the Applicant even in her main submission. He maintained that tlf^re is no sale as such given the surrounding facts, in pa^fcuj^r, t^J, while the alleged sale took place on the
T^^Juiy^^^^^^ssel, by this date the Vessel for v®^h%4he^C Applied had only discharged its part of ttie cX^o the^F^of July 2023 as Annexure PISA-R-B to the^Repf^ Affidavit to the 3rd % // \' Respondent's coulter S^idavit JhpwS^ ■ He th^t, ^<ejj^harge by the Vessel was expected by^^pgHca^^nd the 1^ and 2nd Respondents. That^eingHgie^ase, z<Uie Applicant hade invited the 1st RespJpdent fo^a fflhal calculation and pricing as shown in Annexii%e^I|A-8 to the main affidavit supporting the application. He contended that the invtation was a fact that took place on the 2nd of August 2023 and the 1st Respondent replied by a letter dated the 3rd of August 2023, annexed as Annexure LCT-12 to the 1st Respondent's counter affidavit, stating that they were yet to receive the! final costs for them to issue an invoice. Page 35 of 56 He rejoined that, there was nothing like a sale of the cargo to a third party was ever mentioned. For him, the alleged endorsement was moot. Mr. Malimi rejoined further that the granting of the application will not prejudice the said purchaser since all parties, including the purchaser of the cargo, are herein court and had the opportunity to counter the allegations at least for the 16,778 MT as per the BL. He rejoined further that, if the sale took place, it would be unlawful because the 1st 1 \ Respondent had a contractual obligation to ^pply the cargo. He
castigated alleged the lack of paymefif^e^rity^anexcuse, for not releasing the cargo reiterathg^his S^feic^mat there was full security, first becaifiq^e tk w3s irrevocable and confirmed by the 3rd R^pontl^nt. \ । Mr. Malimi rejoined as wet^haNjie Terms of Reference (ToRs) of the Ld^o hgt have^ requirement of there being reinstatem^^^corife^ded^^fe Respondents except what Field 47A (>) of&e LC tovides, which reinstatement comes afteija "finH^seWfmenr meaning that the supply was now concluded and^ie parties were to sit down and sort out the final se1fce4jienj|as Annexure -LCT-ill & .12 of the 1st Respondent would show. He rejoined further that, since the payments were coming from the confirming bank and tjhe 1st Respondent has the security of the LC, which was irrevocable and confirmed, he ought to have proceeded to deliver the cargo and discharge the Vessel and that happened on the 31st of July 2023. He rejoined that all payments were by way of LG and the 1st and 2nd Page 36 of 56 Respondents were no strangers to the Applicant, hence the assurances given in paragraph 10 of the Applicant's affidavit should not be taken out of context under which they were given. Mr. Malimi rejoined that nowhere was it shown that the LC terms ever got changed or amended and that the concerns under Annexure PISA-5 were about) when the Vessel was to anchor and discharge, that being the context and
nothing else. He submitted further in his rejoinder thiat, the argument that by 15th of September 2023, there was already a fQur-month delay which justified the selling of the cargo if^aiyo, th^ factJs that by 7th of July 2023, the cargo was^qng s^^^m^4^?rat is the case, then all complaints beyoW^e 07>07/zk)23 by the 1st and 2nd Respondent were m^re ^ert^ught^He rejoined that, if i j so, does it mean the payments dbne oh^the 22nd of August and 15th of SeptembeK^02^nvolvin%^heVc were done while there was no cargjOidz theH? alHg^^spohdents kept quiet? he. ar^e^^ayhe^le issue is just a mere manipulation between tfeu^,Xnd, an^the 4th Respondents as facts do not t X \ tally. ^e maint^nea^that if there was any such sale, it was therefortWraudlent sale as it was done when the LC was still I valid. Further, concerning the 25th of May 2023 Notice of Claim and other Statements of Account referred to in respect of the 1st and 2nd shipments, Mr. Malimi rejoined that, all communications were being done before the discharge of the Vessel, on the 5th of July 2023 and 31st of July 2023. He stated that the Notice was followed by a letter dated 09/06/2023 and 17/06/2023, alf of which were in respect of the Vessel, which Page 37 of 56 was going to discharge, and their read ng will prove that the LC was nowhere altered or varied but remained intact. As regards the fact that the KCB-Burundi
confirmed payments or not, Mr. Malimi drew the attention of this court to Annexure LTC -10 to the affidavit ofj the 1st Respondent and Annexure PISA -7 to the Applicant's main affidavit all showing that there was such confirmation that the whole of US$ 60 million was paid. As regards Annexdre LCT-12, it was Mr. Malimi's rejoinder submission that, the l^^espondent has conceded that the Applicant was not p^^jp th^ne^ig as was not a part of it and denfe^ tha%JI&^^l ever represented the Applicant and^Vhatev^r. outcomes reached in that meeting cannot b^sso^ted^ith tnWpplicant. He told this ^ourt the Mpne^cure LCT-12 and the payments are resting %ith the^rd Respondent as the SWIFT Messages ^O^xur^PiSA^Adicate. Responding to the % \ second Respondent^ submission, Mr.; Malimi reiterated his * I submission th|t th|: Applicant's prayers are fully maintainable in this cS^rt, and t^s is^ right application Drought to the attention of the c^^as^constitutes a unique situation demanding the court to look at it. He submitted that; the case of Gulf Bar (Tanzania) Ltd (supra) cited by the 2nd Respondent, is distinguishable and not binding on this court. Mr. Malimi submitted that; it will not be the first time for this court to grant an application as the one at hand as this court has once done so in the case of Synergy Logistics Company Ltd & Another vs. Equity Bank Tanzania Ltd & Page 38 of
56 Another, Misc. Land Application No.51 of 2020. As regards the argument that the 2nd Respondent relied on confirmation from the 3rd Respondent, it was Mr. Malimi's rejoinder submission that, the relationship between the 2nd Respondent and the Applicant was governed by the LC and it was the Applicant who applied for the LC. Concerning the submission that the 2nd Respondent had no duty to inform the Applicant about the sale, Mr. Malimi rejoined that, there was both direct and implied duty otherwise had it been known the Bank of Burundi ^^notl^ye paid the monies she paid on the 22nd oR^ugu^^fe^ia 15th of September 2023. He argued Ifehtbe hpn-ciisclosure has thus made the Applicant sappr afi^cofit^uesWsuffer. As regards the 4th Respondent's ^bmissionX^r.X^limi rejoined that, the jurisdictional issue^aisl,^ by the^th Respondent ought to have been raise^Btil^spbnd^ that the 1st,X"d, jtd 4th Responc are before the court to defeat the riypts'%/ the Applicant. t%He subm^ted XXthat the 4th Respondent has no locus standi to speaCTp^th^^ Respondent or raise the issue of arbitration as the counsel for the 1st Respondent was the appropriate person to have raised it. Even so, he rejoined that this court has jurisdiction over the matters before it. He admitted that indeed clause 10 to the Annexure PISA-3 has an arbitration clause requiring matters between the Applicant and the 1st
Respondent to be referred to the London Court of International Arbitration (LCIA). He argued, however, that the 1st Respondent had not Page 39 of 56 intimated to enforce this clause and it was not the duty of the 4th Respondent to have raised such an issue. Mr. Malimi submitted that, under section 15 of the Arbitration Act, a person who wants to enforce an arbitration clause must follow the procedures laid down by the law which include seeking to stay the matter and resort to arbitration. Section 15 (4) of that Act' does not provide what the court should do and so, the court is given a marcjin of discretion to exercise. He maintained that since the procedure has not been invoked this court has jurisdiction. % J' To support his rejoinder s&^iissfe^®^ea on the decision of the Court of irKthAcase of Scova \ \ \ Engineering S.p.a 8UMiot1%er Vs4 Mtiota Sugar Estates Limited & 3Others, pvil Appeah^o.J^ of 2017 (unreported), on page 18 of^e Court's %^cison. As regards the 4th Respondent^^u£misX>n^WO^ Applicant admitted under that^that is^n dl^pneou^' position to hold as paragraphs 7, 8, and 9^)f the Applicant's Reply affidavit to the 4th Respondent's % I Supplem^ar^ffidavit contain a very clear denial by the Applicant. He submitted that the 4th Respondent has not filed a counter application in which the court could make the set-off orders or the like as the 4th Respondent seems to
insinuate and all that remains matters from the bar. He reiterated his submission that this application has met the requisite threshold applicable to a grant for an interlocutory application as it is not Page 40 of 56 disputed that money has been paid for the release of the consignment since August and September 2023, but no supply was released to the Applicant to date.: Finally, it was Mr. Malimi's rejoinder submission that, the fact that the Applicant is not the only importer or supplier of fuel in Burundi is a side issue not raised by the Applicant but what was said it that the Applicant is one of the major suppliers of fuel in Burundi and the volumes involved in the dispute are serious volumes which can negatively impact bp the Burundian economy. He reiterated that the S^IN^Ad^e received (Annexures PISA-6D, C, D, and^anA^feti^r^LTC-12 all show that payments for were received in % X \ line with the LC arran^nent^ndXor tna1^maztter, the prayers sought need to be granted with%qsts^ the principles applied in the Atilio vs. (supra^avb been established and do With buch Jhng submissions made by the parties, the mairf conc^M/ohfhis cotirt is whether the prayers sought by t \ \t the Applicant fouler be granted by this court. It should be noted, hbwj|yer^hat the Respondents have raised some issues which they ought to have raised then as; preliminary objections, but they have rather
raised them in their submissions as concerns worth looking at. I will first address such issues since they present questions of legal significance. The first point is whether this court is clothed with jurisdiction to hear and determine this application while clause 10 of Annexure PISA-3 (the contract between the Applicant and Page 41 of 56 the 1st Respondent) contains an arbitration clause which direct the parties' dispute resolution to the London Court of International Arbitration (LCIA). In his submission, Mr. Laizer, the learned counsel for the 4th Respondent (being the counsel who raised the matter), argued that the court lacks such jurisdiction. However, Mr. Malimi has argued to the contrary that adding that, the 4th Respondent does not even have the locus to raise the matter which ought to have been raised by the 1st Respondent. % Indeed, this was a point that ouJpMQ hav^eer^aised 1 MT not a party to the arbitration tire mandate to raise % \ \ it. But since it has beer^aislM^as ^issiSWlegal significance, does this court lack tl|e mandat^p hl^r and determine these applications? I thtl^c tfi1| courtt^uriStiiction is not fettered but in so holdy^h^ issb^. tfr^jp^should not be whether this court has ju^tediAn. or but whether such jurisdiction can be e|ercisedhjn f^view^the right apprpach is to approach the mattlytom the^oint of exercise of this court's jurisdiction
and Secondly, the above position also finds strength from what the Court of Appeal stated in; the case of Scova Engineering S.p.A (supra). In the decision, the court was of the settled view that by choosing another forum parties do not oust the jurisdiction of the court since the two courts will equally have jurisdiction. The Court pointed out/however, that: "When the attention of the Court, in which the suit is instituted, is drawn Page 42 of 56 to a contractual stipulation to seek relief in a particular (foreign) forum, the court may, in the exercise of its discretion, stay to try the suit...." However, the third point to note is the fact that a stay must, as section 15 (1) of the Arbitration Act, Cap.15 R.E 2020, have been sought by the party against whom the legal proceedings whether by way of a claim or a counterclaim are brought (and here the 1st Respondent, sinc^he is the party to the arbitration agreement). Nothing of ^at wasWjought before X this court by the 1st Respondent, a^nd ^s%pr^^ sl^g^ed by Mr. Malimi, the 4th Respondent's counsel iWno lotus to raise the issue he has raised. Fro^ tha^pdsitipH,J fjpd that the issue brought by Mr. Laizer^ non^artS^ i The second pdjpt to no|e f^vh^ther the application if granted will ^eei^p| th^ main %iit. In other words, is the application^enablp In^eir^^missions, the 1st, 2nd, and 4th Resp^mde^ fi^Tfr^ea^that this court should
decline the pray|rs sougfi%byXie Applicant, in particular, prayer (b), (d), \ \ % i and (e%Jn the (|iamber summons. However, Mr. Malimi has countered tW@sd4rguments himself arguing that the application can be granted notwithstanding the Respondents' submission and the case they have relied on which he distinguished from the application at hand. It is worth noting the court'? jurisdiction to issue injunctions or interlocutory orders is | indeed wide, arising historically as an incident of its inherent jurisdiction. In this ■। application, as Mr. Malimi rightly stated, the Applicant has Page 43 of 56 premised under section 68 (e) and Orfler XXXVII Rule 2 (1) of the Civil Procedure Code, (CPC) Cap.33 R.E 2019, section 2 (1) of the Judicature and Application of the Laws Act (JALA), Cap.358 R.E 2019, and Rules 10(b) and 11 of the Hugh Court (Commercial Division) Rules.of Procedure, 2012 (as amended). i Essentially, under section 68 (e) of the CPC, the law has given such wide powers that the court! can exercise to prevent the ends of justice from being defeated. In so doing the court may, subject to any rules in that belpalf such other interlocutory orders as may appear ft^th^coiTi^to^ just and convenient. Under that provision the^^s&t-u^^ver left any situation, likely to arise, ^^o^a^ga^remedy. Instead, the court was given th^uris^i^io^tp pptf^ny 'interlocutory order' if it appears
tcf be 'just' a^l 'cbpvenient'. Besides, tlt^ex^ise of ^ch jurisdiction by the court is not dependefftgon fhtag^^^n application by a party but \ . j । rather it caXco&petentlk be exercised where an order is requ|red td^re^nt tne ends of justice from being defeated. # In jM^suJ^ission, Mr. Nyaisa, but more so Mr. Laizer submitted that, in principle that, the purpose of injunctive relief must be to maintain a status quo. With due respect, that is not necessarily the case although it may be one of the effects of an interim injunction, but one must be able to distinguish between interim injunctions and interlocutory injunctions. In essence, an interim injunction I made to preserve the status quo until a named date or until further order or the hearing and Page 44 of 56 determination of the motion on notice while an 'interlocutory7 injunction lasts till the determination of the substantive action i.e., till judgment is delivered. As it was stated in the case oflSea Saigon Shipping Limited vs. Mohamed Enterprises (T) Ltd, Civil Appeal No.37 of 2005 (unreported), while the powers for ordering i interim injunction are provided for under section 68(c) of the CPC and the procedure for obtaining a temporary injunction is prescribed under Order XXXVII, the powersV^r making such other interlocutory orders as may appe^tb^e cd^t tobe just and convenient are provided for ul^lef S^^^SCp^rid
the procedure for making an><. s®^c^er>iptelpcutory orders is prescribed under Ord^OO^. Ahqnterfbtutory order sought is, however, based pn a pending Myt and so cannot be considered in cor^et^olatioiffcp^the pleadings if filed or to be filed. All sucn^rejguitabr^eliefs meant to prevent the ends of justice frpmlping defeated and being of the nature, such are granted at tie discretion of the court which discretion must % 1 be exerdS^jupraously and judicially. It is also worth noting that, for the interlocutory order to be granted the Applicant must have or demonstrate that he has a legal right that is threatened and ought to be protected. Once the acts complained of will lead to an infringement of the applicant's rights, it is proper for the court to intervene by the grant of an injunction. Therefore, where an applicant has no legal right or Page 45 of 56 fails to show that he has one, the court has no power to grant an injunction. Moreover, there must also exist a substantial issue to be I . tried. In principle, an applicant for an order of interlocutory order does not have to make out a case as he would do on the merits, it being sufficient for him to establish that there is a substantial issue to be tried at the hearing. See Attilio vs. Mbowe (supra). See also the English^ case American Cynamid vs. Ethicon Ltd. (1975) ACj 396 7^407. %%%. A court must also decide wMefu* thez^
of convenience tilts in considering whither for an interlocutory order soug^tJyJheM^pi^ant or not. In this regard, the court musty^k itb^lf tfre^uesfrffe - who will suffer more inconvenience ifthe appliJatjon ^granted, and who will suffer more inco^enf^nce if %e Implication is refused? If available sfi%^s^4gj$6 applicant will suffer more hardship if ApIicatiBa is refused, then the balance of conveniences irNgis favour. ^ow, revd^ing% the issue of whether the granting of the orders slight defeat the main suit rendering it superfluous, Malimi has argued that the application^ has been brought to prevent a continuing breach and hence the Applicant's effort to mitigate the harms that flow from 'it. Essentially, I do understand, as this court once stated in the of Fabec Investment Limited vs. MES International Financial Services (PTY) Ltd & Another, Commercial Case No.07 of Page 46 of 56 2022 (unreported), that, a party who is about to suffer losses which he can clearly foresee, has a duty to mitigate. But looking at the current application and the order i number (a) which appears' in the chamber summons and compares the same with relief number (d) in the plaint, I find that the two are indeed similar or have the same effect. But will granting the application render the entire suit superfluous? In his submission, Mr. Malima has argued; that the Plaint does not have only one relief
which the Plaintiff (Ap^cant herein) is % seeking but what the Applicant is doing;i^to^tig^g th^osses and avoid the continuing breach whi^h b^^nfe^^leaded in the Plaint. X \ Indeed, as I lookjt the^ffidayits, tne%annexures thereto f \X and the submissions ip their entity,Xdo find that the plaint annexed to the a^lica^pn as A^eWure PISA-1 has about 8 reliefs sou^Oy^theXppfrwX^^ not just one relief. Had it \ '\* 1 been just onXrehljLwhicnMs similar to the relief prayed for in this Jpplicatro^, l^youlcrhave been convinced by the wisdom c //% ! statedyn the Nigeria!) Court in the case of Eyo vs. Ricketts (2005) Xe^I^PT. 241) 387 at 393 Paras D-E to the effect that where the relief prayed for in an interlocutory application is the same as that claimed in the main suit, it is advised that rather than grant such relief, an Order for accelerated hearing of the main suit be made by the Court. But as I stated, the reliefs in the Plaint are not just one and the court when satisfied that there is a need to prevent the ends of justice from being defeated, can, if it appears to Page 47 of 56 be 'just' and 'convenient', grant the orders sought. Having heard the submissions from the partes, and looked at the pleadings, and the annexures attached thereto, I find that, the question to address is therefore whether it is just and convenient to grant the orders (specifically order number
(a)) sought in the chamber summon. ! i That prayer seeks the release of the consignment of fuel destined for the Republic of Burundi whose payments, as per the Applicant's claims, were duly settled by Applicant but disputed by all Respondents. In their sup^t^Jpns/^pwey^r, the learned counsel for the 1st, 2nd, Xid \4\ have argued that even if the order rijibej- (^Ms t^be granted, it will be a waste of time an^enel^ sfhce tlp&^bject matter, i.e., the fuel consignment|sought toXg released has been sold to other off-takers. ^e f^rned cbynsll for the 2nd Respondent submitted feffi^anc^haXOi^rder is granted that will not f As p^l%thdWachetl documents (Annexures N-6 to the t % X ' counter affidavit^ of the 2nd Respondent: shows, however, the endorsement jjlthe Bill of Lading (BL) signifies that the consignment was delivered to the 4th Respondent on the 7th of July 2023, a date when the BL was endorsed. But Mr. Malimi, the counsel for the Applicant, has argued that such an assertion and evidence is only a fabrication to blind the eyes of the observers, including this court. I Indeed, looking at Annexure PISA-5D which shows that the Vessel MT Khasab Silver was ready to discharge by the Page 48 of 56 26th of July 2023 and, further, looking at Annexure PISA-8 to the Applicant supporting affidavit which is also Annexure N- 9 (annexed to the Respondent's counter affidavit) dated 2nd
of August 2023 and its reply by the 1st] Respondent on 03rd of August 2023, (Annexure -N-9), there is no indication whatsoever the cargo had been sold. ; Annexure PISA-8 which is a letter addressed to the 1st Respondent asking for a meeting wherein the parties were to agree on final calculations and pricing, was%£sponded to by Annexure N-9 to the 2nd Respondent's^buQ|er-a1^daviUwhich reads as follows: X \ August 2023,Xd hele^y aoW^^ot that wOave nohyet reived the I '\ figal clajm from <gur S^pliers with regards demurrcige arid other. d^il we feve received details of all ^ostXand have issued the final ft As if nfay be noted hereabove, the response was given on the 03rd day of August 2023 while the BL (Annexure N-6 to the 2nd Respondent's counter affidavit) one will note that the endorsement was done on the 07th of July 2023. If that happened it means, therefore, and as Nr. Malimi argues, that, the cargo was sold before even the vessel discharged her cargo something which does not add up to the narratives of the 1st Respondent as evinced in Annexure N-9 cited hereabove. I Page 49 of 56 will therefore agree with Mr. Malimi that, if the sale took place, then it would constitute a fraudulent act that cannot be sanctioned by this court. Under such a circumstance the court must not hesitate to act to protect the innocent party. I hold it to be so because, in line with Annexure PISA- R
-1 annexed to the Affidavit in reply to the 1st Respondent's counter affidavit, the Vessel discharged its cargo twice at the i port of Dar-es-Salaam, first on 1st of July 2023 and second on . % 31st of July 2023 while the endorsement on%^nnexure N-6 shows that it was done on the 07th of 5^1^023 tvgeks^before the Vessel discharged her laden car^qan^^^tln^^en the LC, (Annexure PISA -4 atta^teto tlXsuiJworting Affidavit of the Applicant) was stilkvalia^Mofepver/^Wsubmitted by Mr, Malima, between Jul^ up to Se^m^ 2023 (as Annexure LCT-9 shows) t^ pities wdt^ sfill in communication but nothing in^O^omth^nfcatiop^d anything to do with the {In mKvi^w. sucfr non-disclosure of facts would raise I % % alarrn^ and mo^p scbwhen the cargo is said to have been sold to the 4%{^jg|hdent who alleges to have a claim over the cargo. Was there a scheme to divert the cargo to the 4th Respondent or was it a mere manipulation between the 1st, 2nd, and the 4th Respondents as argued by Mr. Malimi? While I need not go to any such details in this application since those are matters that could be looked at in the main suit, it suffices to note from the affidavits and annexed documents that the consignment alleged to be sold was sold!to the 4th Respondent. Page 50 of 56 I do understand, however, thatj the alleged fraud if any will need to be looked at more in detail in the main case as this court cannot go
to its details in this present application, But as Denning Id's statement in Lazarus Estates Ltd vs. Beasley [1956] 1 QB 702 at 712, reveals: ! "... No court in this land will allow a person to keep an advantage which he has obtained by fraud. No judgment of a court, no order ..^an be allowed to stand if it^ias bee1\ obtained by fraud. Fraud %inr^yels \ J? everything. The court i&QarefuI^fro find fraud un^^^ isX^istf^tly pleaded and ^oveJxbut^ft^it^is proved^ it vitiates ^Jidgments, contracts, and< aff% transactions \ K X, wh^zoe\^..." \ In submissions, ftlWralimi argued that, on the 06th Res^ndentjt^d twelve money to the tune of US$ 15 million for th^last consignment as per Annexure PISA-6B of the supporting^aW^vit. As it may be noted, if on the 07th of July 2023 such was the situation and on the same date the consignment was allegedly sold to the 4th Respondent what does such fact portray? Does it not suggest that the sale borders fraudulent conduct if at all that happens to be true? I do not think that I will respond jto the above question as of now, but as I stated earlier, more facts will be needed to unravel what really took place. Even so, that does not mean Page 51 of 56 after looking into the facts.and circumstances of the case and all that has been laid bare to the court, this court will be prevented from exercising its discretion and protecting the ends of justice
from being defeated. In my view, any action or behavior that undermines the pursuit of justice and the legal process has the potential to defeat the ends of justice. Essentially, two rules will apply1 when there is an issue relating to the need to protect ends of justice: (a) that, it is the ends of justice that injury should be av^<ed, prevented, remedied, or mitigated as soon as pr^ic^ble ^d needless expenses and inconvenience to paces' bX^o^^aTO (b) it will not be in the ends of just^to^x^se^iherent powers if it would interfere with>the\itei%$: ortfcfparty or cause mischief or injustice. ( \ X In this ap^catf^n, theX^pfeaht seeks to prevent or mitigate gr^W^gconV^nillw^^^idering that, as Annexures PISA 6 (aWk an&%Annexure PISA 7 indicate, the ""'W Applpant ha^atd^nonie^ in respect of the consignment which neve^eless ha^nofrbeen released when it should have been releaseaMjjie Respondents' counsel have contended that it was the Applicant to blame for her delayed payments. But as I look at the annexures PISA 5(a), (b), (c) and (d) attached to the supporting affidavit, the facts tend to tell me a different story as it is the 1st Respondent who could not allow the Vessel to । berth and discharge the cargo timely despite being assured of i payments. Page 52 of 56 It is also worth noting, as correctly argued by Mr. Malimi, that, the parties were no strangers in business to the
extent of there being such a level of mistrust.1 Being guided by those principles earlier stated hereabove and, considering the facts and all submissions and materials laid before me, I do not find it proper that the 1st and 2nd Respondents should have withheld the release of the cargo. That was an uncalled-for act that exerts not only irreparable harm to the Applicant but also to the economy of the people of Burundi who are thl^nd users of the fuel which the 1st and 2nd Respond^hte^ hav%^refused to discharge to the Applicant while tliX^arti^^ffM^Wig been operating under an atmosgheT<Jse^ur§d^by^he LC which was irrevocable and confirmed. *'''\ """\ * As it may be ncfted from thez submissions, the 1st and 2nd Respondents confegdeMjthat thb^ wls no reinstatement of the LC to provid^byer t&^he^mgnment and issue of releasing the cargo carrot arise givbn that no full payments were made. However, a^orfe^ly argued by Mr. Malimi, since the LC was irrevocable an?k confirmed, the issue that there was no reinstatement j^the LC to provide cover to the consignment cannot arise as there are all indications that full payments were made. The LC was a revolving one, meaning that it was opened for the stated amount and the drawings under it were reinstated as soon as the documents were paid upon final settlement. This further explains why I held that the withholding of the discharge was uncalled
for. Page 53 of 56 Notable also and adding to that reasoning is the fact that, being irrevocable and confirmed it means it was not subject to any unilateral modification or revocation during its validity and i - the beneficiary had a firm undertaking of not only the bank i issuing the credit, but also of the confirming bank. Now, firstly, as submitted by Mr. Malima, there is no indication that the LC was amended meaning that its terms remained throughout its validity period. Secondly, as a matter ^of principle, each document must be construed according to its'tbgns. As correctly % argued by Mr. Malimi, a look at Field of^he Lp^does confirm that reinstatement was allowed up^^fel^roment. Turning to the subiWsiggs ^fgadK by Mr. Laizer, X \ \ regarding the interest of.the^h R^opdfete/I will only make limited comments Regarding \uch\submissions. In his submission, Mr. lSizer%^s argued tnht the 4th Respondent has an unsettlrfWim Applicant as evinced by % % \ Annexure ^0-Which^re invoices for a sum of US$ l,62f,321.89^lu^81,361 being the value of dead stock for the leadet^ Depot, ^e submitted that, the 4th Respondent had rendere^^vk^ to the Applicant without being paid and that all efforts to demand payments have not been fruitful. However, as correctly submitted by Mr. Malima, since the 4th Respondent is a party to the main suit, which is pending, such matters can be addressed
therein; To urge this court to grant the 4th Respondent set-off orders while the 4th Respondent has not filed a counter application in which the court could make orders as Mr. Laizer sdems to urge this court Page 54 of 56 to do would be inappropriate since, as a matter of principle, this being a court of law, it works based on the materials laid before it. Likewise, it cannot act in anticipatioin that a particular party will file a claim in the future. From all that I have stated and discussed here, I find that the Application has merits and meets the thresholds for the grant of an interlocutory order Under section 68(e) and Order XXXVII Rule 2(1) of the CPC, Section 2(3) of the Judicature and Application of Laws Act, Cap.358 R.E 2019, Rdt^s 10 (b) and 11 Because of all that I stffed^r^ajooife, and there being a necessity to prevent toe eh^s o^ystice^wom being defeated this court finds it juft and con^nieri^ to grant the prayers sought and settleS^or t^e follo^i^g Orders: XJTntinuIhg^ breach of the Supply XContract dated 24th June 2023 and Standby Letter of Credit dated %^A/9/2022 and the 1st .and 2nd Respondents should forthwith release the cargo of 20685.61 MT, gasoline which is under the storage of the 4th Respondent, to the Applicant.
2. That, since the parties are engaged in Commercial Case No. 130 |Of 2023 which is pending before this court, Page 55 of 56 costs of this application shall be in cause. It is so ordered. FED AT DAR-ES-SALAAM ON THIS 08th DAY OF DECEMBER 2023 Page 56 of 56
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