sabri muslim karim formelly known as sabri ally saad 2 others vs muslim shivji karim another 2022 tzhclandd 15710 24 november 2022

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA (LAND DIVISION) AT DAR ES SALAAM LAND CASE NO. 247 OF 2021 SABRI MUSLIM KARIM (formerly known as SABRI ALLY SAAD 1®^ PLAINTIFF PROPERTY INVESTMENTS LIMITED 2"° PLAINTIFF PRIME PROPERTIES(T)LIMITED 3"° PLAINTIFF VERSUS MUSLIM SHIV3I KARIM 1®^ DEFENDANT HBL BANK UK LTD (formerly known as HABIBSONS BANK LIMITED 2^° DEFENDANT Date ofLast Order: 6/10/2022 Date ofRuHrjg: 24/11/2022 RULING I. ARUFANI,J. The plaintiffs hereinabove instituted the present suit in this court against the defendants jointly and severally claiming for reliefs inter aiia being a declaratory order that a consent settlement made on 26'^ September, 2021 between the 1=^ defendant allegedly acting for and on behalf of the 2"^ and 3^" plaintiffs and the 2"" defendant is void and not binding on the piaintiffs. In a bid to respond to the plaintiffs' claims the 2"" defendant filed in the court a written statement of defence accompanied with four points of preliminary objections. When the matter came for hearing the points of preiiminary objection raised by the 2"^ defendant the piaintiffs were represented Mr. Wailece Mfuko, iearned advocate and whiie the second defendant was represented in the matter by Mr. Rugambwa Pesha, learned advocate, the first respondent never appeared in the court despite the fact he was duiiy served through his advocate nameiy Yakubu & Associates Chamber. The counsei for the 2"=" defendant notified the court they wili only argue the first and second points of preliminary objection raised by the 2"" defendant and they wiil drop the rest of the points of preiiminary objections. The points of preliminary objections argued by the counsel for the 2"'' defendant can conveniently be reduced to two folds that, the current suit is resJudicata and as the suit is chaiienging the consentjudgment itis un- maintainabie. By consent of the counsel of the parties the stated points of preiiminary objections were argued by way of written submissions. Submitting on the said points of preiiminary objection, the counsei for the 2"" defendant stated that the present suit is res judicata as there was another case filed in this court which was registered as Civil Case No. 169 of 2020 with reliefs which were directly and substantially the same as in the present matter. He stated further that the said case was settled by consent of the parties on 27'*' September, 2021 and the parties'settlement was adppted by the court as a decree of the court on 8"^ October, 2021. He argued that, the present suit offends section 9 of the Civil Procedure Code [CAP 33 R.E 2019]. To support his argument, he referred the court to the cases of Gerard Chuchuba V. Rector Itaga Seminary [2002] TLR 213, Peniel Lotta V. Gabriel Tanaki & two others [2003] TLR 312 and Esther Ignas Luambano V. Adrlano Gedam Kipalile Civil Appeal No. 91 of 2014 (unreported) where it was stated under what circumstances a suit can be said is res judicata. He quoted in his submissions the five conditions stipulated in the case of Peniel Lotta (supra) which were stated must co-exist to bar a subsequent suit. According to the counsel for the 2"" defendant the previous suit instituted in the court involved ail the parties in the present matter except the I®' plaintiff and it was before the court with competent jurisdiction as evidenced by the decree and consent settlement deed entered by the parties. He stated the suit was finally determined hence no any other suit can be filed in court in respect of the same matters as stipulated under Section 9 of the CPC. To support his argument, he prayed the court to take judiciai notice pursuant to section 59(1)(a)of the Evidence Act[Cap 6 R.E 2019] of existence of the consent judgment entered in Civil Case No. 169 of 2020 Going to the second limb of the point of preliminary objection the counsei for the 2"=" defendant argued that, the present suit has been improperiy instituted in the court as there is an existing consent judgment entered in civil case No. 169 of 2020 that resolved the dispute between the parties to the present suit. He argued that, the issues and reliefs claimed in the previous suit and finaliy determined were similar to the issues and reliefs claimed in the previous suit. He submitted that, the piaintiffs were required to apply for review or seek for leave to appeal against the consent judgment and not to file a separate suit in the court. To fortify his argument the counsei for the 2"" defendant cited in his submission the case of Arusha Planters and Traders Ltd & Two others V. Euro African Bank(T) Ltd Civil Appeal No. 78 of 2001 (unreported) where It was stated that, in Tanzania there is no specific provision in the Civii Procedure Code aliowing a consent judgment to be challenged by way of instituting a separate suit in the court. It was stated what is ciear is that such a judgment can be challenged by way of review or appeal with leave of the High Court. The counsel for the 2"'' defendant argued further that, in order to chaiienge a consentjudgment existence of fraud, misrepresentation, duress or coercion must be proved as was stated in the case of Brooke Bond Liebig (T) Ltd v Mallya [1957]! EA 266 (CAD). He stated in the plaint filed in the present suit there is nowhere the piaintiffs alleges fraud, misrepresentation, mistake or coercion of the stated consent judgment so as to justify invalidation of the consent judgment under section 19 of the Law of Contract Act, Cap 345. It is his submission that, the plaint has not disclosed a cause of action hence it is offending Order VII Rule 1 (e) of the CPC. In fine he prays the suit be struck out with costs. In reply the counsel for the plaintiffs stated that, the present suit is not res judicata because the principles constituting the same as stipulated under Section 9 of the CPC have not been cumuiatively estabiished. According to the plaintiffs' counsel to constitute res judicata it must be established the issue in the former suit is substantially the same as the issue in the subsequent suit. He submitted that in the former suit. Land Case No. 169 of 2020 the issue was about breach of loan agreement entered upon between the defendants and 2"'' and plaintiffs but in the present suit the issue is validity of the consent judgment which shows the issues in the two suits are different. He submitted further that, the other conditions which must be established to invoke the principle of res judicata is that the parties litigating in the former suit must be the same parties litigating in the subsequent suit. The counsel for the plaintiffs argued that, the stated element has not been established because the I®' plaintiff in the present suit was not a party in the former suit. Land Case No. 169 of 2020. He argued in relation to the second limb of the preliminary objection that, the current suit has been properly filed in the court because as the first plaintiff is a stranger to the former suit, he cannot appeal against the stated consent judgment. He submitted that the first plaintiff was right to opt to institute in the court the fresh suit to challenge the stated consent judgment. To support his argument, he referred the court to the case of Arusha Planters and Traders Ltd & 2 other, (supra) where it was stated it is legally possible for a person to file a separate suit to challenge a consent judgment though that depends on peculiar facts of each case. In rejoinder the counsel for the Z"'' defendant essentially reiterated his submission in chief. He however emphasized that, the elements of res judicata have been established. As regarding to the contention that the plaintiff was not a party in the former case, he submitted that, the plaintiff is a shareholder and also a director of the 2"'' and 3"^ plaintiffs hence he cannot be completely excluded himself from Land Case No. 169 of 2020. Having carefully gone through the parties' rival submissions as filed in the court in relation to the points of preliminary objections raised by the counsel for the Z"'' defendant the court has found the issues to determine here are whether the present suit is res judicata, and whether the consent judgment can be challenged by way of filing a fresh suit in the court. Starting with the first issue the court has found in order to say a suit is res judicata to the former suit and as rightly argued by the counsel for the plaintiff there are conditions which must be established are in co existence into two matters. Those conditions can be derived from section 9 of the Civil Procedure Code which were well summarized in the case of Peniel Lotta (supra) and reproduced in the case of Ester Ignas Luambano (supra) where it was stated that: - "The scheme ofsection 9 therefore contemplates five conditions which when co-exist, will be bar a subsequentsuit. The conditions are; (I) The matter directly and substantially In Issue In the subsequentsuit musthave been directly and substantially In Issue In the former suit;(H) The former suit must have been between the same parties or privies claiming under them;(III) The parties must have litigated under the same title In the former suit; (Iv) The court which decided the former suit must have been competent to try the subsequentsuit and(v) The matter In Issue must have been heard and finally decided In the forrner suit." While being guided by the afore stated principie of the iaw the court has found that, in order to be able to determine whether the present suit is res judicata the court is required to iook into both suits to see whether the conditions stated hereinabove for the doctrine of res judicata to be invoked have been established. Starting with the first condition the court has found the counsei for the second defendant argued that, the issue in the previous suit and the issue in the current suit are the same. The court has found as rightiy argued by the counsel for the plaintiffs the issue in the previous suit is not substantially the same as the issue in the present suit. The court has come to the stated finding after seeing that, as rightly stated by the counsel for the plaintiffs, while the issue in the previous suit was about breach of loan agreement the issue before the court is about validity of the consent judgment entered by the parties. That makes the court to come to the settled view that, the issue determined in the previous suit is not substantially the same as the issue intended to be / determined in the present suit. Another condition which the court has found proper to have a look is the conditions of the parties invoived in the previous suit and the parties involved In the present suit. The court has found section 9 of the Civil Procedure Code states the parties In the subsequent suit must have litigated under the same title in the former suit. The court has found while the parties in the former suit (Civii Case No. 169 of 2020) were Musiim Shivji Karim, Property Investment Ltd and Prime Properties Ltd, the first, second and third piaintiffs respectiveiy, on the other hand HBL Bank UK Ltd (Formaiiy known as Habibsons Bank Limited was the defendant. That shows clear that the first plaintiff was not a party In the previous suit. The court has found the counsel for the second defendant argued that, as the first plaintiff is a shareholder and director of the 2"'' and 3^" plaintiffs, he cannot exclude himself from the former case. The court has failed to agree with the afore stated argument made by the counsei for the second defendant after seeing that a mere being a Shareholder or Director of a company is not an automatic condition which make the stated Shareholder or Director a party to a case. The court has found as rightiy argued by the counsel for the plaintiffs the ruie stated in the case of Salmon v Salmon & Co. Ltd [1897] AC 22 that a naturai person is iegaiiy distinct from a corporation applies here. The court has found as the first plaintiff has averred that he was not involved in the previous suit whereby the second and third piaintiffs were parties it cannot be said the parties in the previous suit and the parties in the present suit are the same. The stated finding moves the court to find the present suit is not res judicata to the previous suit because as stated in the case of Peniel Lotta (supra) aii conditions for the principie of res judicata to be invoked must co-exist. The court has also found that, as the former suit ended with consent or compromise judgment between the parties the doctrine of res judicata cannot be invoked in the present suit because a compromise or consent judgment is not a decision of the court. It is rather an acceptance by the court of something to which the parties have agree to and the court has not decided anything in the matter determined by compromise or consent 10 judgment. The stated position of the law was ampiified by C. K. Takwani on Civil Procedurie Code, 7"^ Edition, P. 378 thus; "A compromise decree Is not a decision of the court. It is acceptance by the court of something to which the parties had agreed. A compromise merely sets the seai of the court on the agreementofthe parties. The courtdoes decide anything. Nor can it be said that a decision of the court is implicit in it. Hence a compromise decree cannot operate as resjudicata." In the iight of what has been stated hereinabove the court has found the first point of preiiminary objection raised by the second defendant that the suit at hand is res judicata is devoid of merit hence it cannot be upheid. Coming to the second point of preiiminary objection which states whether a consent judgment can be chaiienged by way of fiiing a fresh suit in the court the court has found it is undisputabie fact that, aii the parties in the present suit with exception of the first piaintiff entered into a consent judgment in Civii Case No. 169 of 2020. The court has found the counsei for the second defendant argued that, as the piaintiffs are chaiienging the stated consent judgment the suit is incompetent. 11 The counsel for the second defendant argued the remedy available for the plaintiffs was to seek for review or appeal against the stated consent judgment and not to file the present suit in the court. On the other hand, the counsei for the plaintiffs argued that, as the first piaintiff was not a party to the former suit there is no law which bars him from filing a fresh suit in the court to challenge the consent judgment. The court has carefully gone through the decision made by the Court of Appeal in the case of Arusha Planters and Traders Ltd [supra] which was heavily relied upon by the counsel for the parties to fortify their respective stances. The court has found it was held by the Court of Appeal in the cited case that, there is no specific provision of the law in the Civii Procedure Code aiiowing a consent judgment to be challenged by way of separate suit. It was clearly stated in the cited case that, what is cleariy provided in the cited law is that such a judgment can be challenged by way of review or appeai with the ieave of the High Court. The court has found it was argued by the counsel for the plaintiff that, the above cited case is distinguishable from the present case because the parties in the cited case were the same whiie in the present suit the first piaintiff was not a party in the previous suit. The court has found under 12 that circumstances the first piaintiff couid have appiied for revision of the stated consent judgment in iieu of the appeal which is clearly governed by our laws. The court has found the only circumstances where the parties can challenge a consent judgment by way of filing a suit in the court as stated in the case of Brooke Bond Liebig (T) Ltd (supra) cited by the counsel for the second defendant is where there is allegations of fraud, misrepresentation, duress, undue influence or coercion in the consent judgment intended to be challenged. Although the second and third plaintiffs couid have challenged the consent judgment they entered, basing on the ground stated hereinabove but there is nowhere in the pleadings filed in this court by the plaintiffs it is alleged the plaintiffs are challenging the consent judgment they have entered basing on the stated ground of fraud, misrepresentation, duress, undue influence or coercion. As there is no any of the stated grounds in the pleadings filed in the court by the plaintiffs the court has found the second point of preliminary objection raised by the second defendant that the suit which is challenging the consent judgment entered by the parties is unmaintainable has merit and deserve to upheld. 13 Consequently, the second point of preliminary objection raised by the second defendant in the present suit is hereby upheld and the plaintiffs' suit is accordingly struck out with costs for being unmaintainable. It Is so ordered. Dated at Dar es Salaam this day of November, 2022 ❖ o \y\ \ I. Arufani X H ★ JUDGE 2AI1112022 Court: Ruling delivered today 24'^ day of November, 2022 in the presence of Mr. Shaloom Msaky, learned counsel holding brief for Mr. Wallace Boniface, counsel for the plaintiff and in the presence of Mr. Richard Mchwampaka, learned counsel for the second defendant. The first defendant is absent. Right of appeal to the Court of Appeal is fully explained. o V T V/ X > I. Arufani > fr?. \ JUDGE 2A11112022 14