CIV

IN THE COURT OF APPEAL OF TANZANIA AT MTWARA (CORAM: KEREFU. J.A.. RUMANYIKA. J.A. And MGEYEKWA. J.A.^ . CIVIL APPEAL NO. 91 OF 2023 SANLAM LIFE INSURANCE TANZANIA LIMITED APPELLANT VERSUS AZIZ NASSORO MZEE................................ ,1st RESPONDENT SOPHIA ISSA JUMA................................... ,2nd RESPONDENT THE NATIONAL MICROFINANCE BANK PLC 3rd RESPONDENT (Appeal from the Judgment and Decree of the High Court of Tanzania, at Mtwara) (Dvansobera. 3.^ dated the 30th day of September, 2021 in Land Case No. 02 of 2018 RULING OF THE COURT 31st May & 4th June, 2024 KEREFU. J.A.: The appeal before this Court is against the judgment and decree of the High Court of Tanzania at Mtwara (Dyansobera, J) dated 30th September, 2021 in Land Case No. 02 of 2018. In that case, the first and second respondents herein, sued the third respondent for a declaration that the first respondent as the beneficiary of the loan facility and the second respondent as a guarantor of the same, they are not indebted to the third respondent in terms of the physiotherapy report. That, the third respondent had no legal power to either, under the law or the loan agreement to sell, lease, appoint a receiver or manager or enter into possession of the mortgaged properties registered as Plot No. 513, Block 'B' Jida TRM area, Masasi Township under Certificate of Title No. 5045 MTW, in the name of the second respondent; Plot No. 107, Block 'G' Mkuti area, Masasi Township under Certificate of Title No. 5981 MTW; Plot No. 109 Block 'G' Mkuti area, Masasi Township under Title No. 5925 MTW and Plot No. 178 Block 'A' Jida North area, Masasi Township under Certificate of Title No. 3801 MTW, in the names of the first respondent. They also prayed for orders that, (i) if there is any claim arising out of the Letter of Offer for the term loan facility dated 19th June, 2017, the same should be directed and or recovered from the insurer; (ii) a permanent injunction to be issued on the third respondent and/or her agents; and (iii) payment of general damages, interest and costs of the suit. Upon being served with the plaint, the third respondent filed a written statement of defence vehemently denying all the claims raised by the first and second respondents. The third respondent maintained that, the first and second respondents are indebted to her jointly and severally and the bank has legal powers under the loan agreement to exercise whichever right, at her disposal, including sale, lease and appointment of a receiver or manager over the mortgaged properties for recovery of the defaulted loan. As such, the third respondent prayed for the suit to be dismissed with costs. The record bears out that after the pleadings were completed and before the hearing of the suit commenced, the third respondent, on 18th September, 2018, informed the learned trial Judge that they have filed an ex parte application intending to join a third party to the suit to the effect that, if she is made liable, the third respondent is entitled to be indemnified by the third party. It is also on record that the said third party notice was filed by the third respondent on 7th June, 2019. Subsequently, on 8th July, 2019, the written statement by the third party, the appellant herein, was filed. In the said statement, the appellant disputed the respondent's claims by stating that the first respondent is not eligible for the insurance cover. Thereafter, a final pretrial conference was conducted on 24th September, 2020 where the following two issues were framed and agreed upon by the parties: 1. Whether the first respondent is entitled to be indemnified by the third party; and 2. To what reliefs are the parties entitled. Having heard the parties and analyzed the evidence adduced before him, the learned trial Judge decided the suit in favour of the respondents as he ordered that the claimed loan amount should be recovered from the insurer, the appellant. The decision of the High Court prompted the appellant to lodge the current appeal to express her dissatisfaction. In the memorandum of appeal, the appellant raised three (3) grounds of complaints. However, for reasons which will be apparent shortly, we do not deem it appropriate, for the purpose of this ruling, to reproduce them herein. At the scheduled hearing of the appeal before us, the appellant had the services of Mr. Paschal Kihamba, learned counsel. On the other side, the first and second respondents were represented by Mr. Gide Magila, [earned counsel whereas the third respondent was represented by Mr. Stephen L. Lekey, also learned counsel. Upon taking the floor and before advancing his arguments on the grounds of appeal he lodged earlier, Mr. Kihamba sought and obtained leave to add the following ground: "That, the learned trial Judge erred in law for failure to comply with the third-party procedure prescribed under Order I Rule 14 (3) o f the Civil Procedure Code, Cap. 33 o f the Revised Edition 2019." Submitting on that ground, Mr. Kihamba argued that having perused the record of appeal and specifically the trial court's proceedings, he realized that before the trial court, the procedure of joining the third party was not complied with as the third respondent was not granted leave by the trial court to present a third-party notice as required by Order I Rule 14 (3) of the Civil Procedure Code, Cap. 33 (the CPC). To clarify further on this point, Mr. Kihamba referred us to pages 155 to 159 of the record of appeal and argued that, apart from an indication that the third respondent informed the learned trial Judge that she had filed an ex parte application intending to join a third party in the suit, the record is silent as to whether that application was determined by the trial court and the requisite leave granted. That, in the circumstances, it is not clear as to when exactly and how the appellant was joined in the trial court's proceedings as a third party. It was his strong argument that the said omission is a fundamental error, which has contravened the mandatory provisions of Order 1 Rule 14 (3) of the CPC thus, rendering the entire proceedings of the High Court a nullity. Based on his submission, Mr. Kihamba beseeched us to nullify the proceedings and the judgment of the High Court, set aside the subsequent orders and remit the case file to the High Court for it to determine the dispute.afresh before another Judge. Mr. Magila conceded to the submission made by Mr. Kihamba on the failure by the learned trial Judge to comply with the third-party procedure. As such, he also prayed for the entire proceedings and the judgment of the trial court to be nullified and the suit to start afresh before another Judge. On his part, Mr. Lekey strongly challenged the submissions and prayers made by his learned friends. He referred us to page 155 of the record of appeal and argued that, there is no doubt that the third respondent filed an ex parte application intending to join a third party in this matter. That, the said application, being an ex partem nature, it was determined separately from the proceedings of the main suit and that is why, the main suit was adjourned several times pending the final determination of the said ex parte application. Therefore, according to him, the issue is not on the non-compliance of the third-party procedure and nullification of the entire proceedings and judgment of the trial but, instead, the defect is on the missing record which can be cured under Rule 96 (7) of the Tanzania Court of Appeal Rules, 2009 (the Rules). The learned counsel was confident that the record of the said application is available at the High Court as he as well represented the third respondent during the trial. In a brief rejoinder, Mr. Kihamba did not have much to say, as he decided to leave the matter to the wisdom of the Court. Having considered the arguments advanced by the learned counsel for the parties on the additional ground, we find apposite to reproduce Order I Rule 14 (1) and (3) of the CPC which is governing the third-party procedure. Order I Rule 14 (1) provides that: 14 (1) "Where in any suit a defendant claims against any person not a party to the suit (hereinafter referred to as 1 the third party') - (a) any contribution or indemnity; or (b) any relief or remedy relating to or connected with the subject matter o f the suit and substantially the same as a relief or remedy claimed by the plaintiff, the defendant may apply to the court for leave to present to the court a third-party noticev (3) Where, upon an application made under subrule (1), the court is satisfied that the defendant's claim against the third-party is in respect o f a matter referred to in paragraph (a) and (b) o f that subrule and that, having regard to all the circumstances o f the case, it is reasonable and proper to grant leave to the defendant to present a third party notice, the court shall, upon such terms and conditions as it may thinkjust, make an order granting the defendant leave to present a third party notice." Emphasis added. In terms of the above provisions, it is clear that the essence of the third-party procedure is to permit a defendant to join another person who is not a party to the case whom he believes that he has a right to indemnify her/him in the event she is found liable in the suit preferred against him by the plaintiff. This was also intended to avoid a multiplicity of actions. It should be noted that the third-party procedure is extensively covered under Order I Rules 14 to 23 of the CPC. This Court in several occasions, has pronounced itself on the applicability of the above provisions. See for instance, the cases of Hasnain M. Murji v. Abdulrahim A. Salum t/a Abdulrahim Enterprises, Civil Appeal No. 6 of 2012 [2012] TZCA 13: [29 June 2012: TanzLII]; CRDB Bank PLC v. 3 The Registered Trustees of Kagera Farmers Trust Fund & 2 Others, Civil Appeal No. 496 of 2021 [2024] TZCA 94: [23 February 2024: TanzLII] and National Bank of Commerce Limited v. Saoligo Holdings Limited & Another, Civil Appeal No. 455 of 2022 [2024] TZCA 384: [24 May 2024: TanzLII]. Therefore, in order to succeed in a third-party procedure, the defendant is enjoined to apply for leave of the trial court to join such a person. It is a common ground that, an application of that nature is heard and determined ex parte and once granted leave, a third-party notice should be served on the third party who is, in terms of Rule 17 of the same order, entitled to file a defence (the written statement of defence), either against the defendant or against the plaintiff's claim over the defendant's liability. In the instant appeal, as correctly argued by the learned counsel for the parties, apart from indicating that the third respondent had filed an ex parte application intending to join a third party, the record of appeal is silent as to whether the said application was determined and the third respondent granted leave to file the third-party notice. 9 We are mindful of the fact that in his submission, Mr. Kihamba urged us to nullify the entire proceedings of the trial court for that omission, remit the case file to the High Court and order for a retrial. With profound respect, we are unable to agree with him on that aspect. We have decided to take that route, because it is evident at pages 155 to 160 of the record of appeal that, on 18th September, 2018, the learned trial Judge was formally informed by the learned counsel for the third respondent that an ex parte application intending to join a third party in the suit had been filed. Subsequently, the hearing of the main suit was adjourned on several days, including, on 13th November, 2018, 21st May, 2019 and 23rd May, 2019, pending final determination of the said application. However, the said application, its proceedings and the decision of the trial court granting leave to the third respondent to file a third-party notice are missing in the record of appeal, thus rendering it incomplete. As such, we find no difficult to agree with Mr. Lekey's submission that the noted defect in the record of appeal is curable under Rule 96 (7) of the Rules. In the circumstances and for the interest of justice, we hereby grant leave to the appellant, under Rule 96 (7) of the Rules) to include the said missing documents, (i.e the ex parte application and the trial court's 10 order granting leave to the third respondent to file the third-party notice), in the record of appeal. The appellant should lodge the said supplementary record of appeal within forty-five (45) days from the date of delivery of this ruling and serve it upon the respondents. In the meantime, the hearing of the appeal is adjourned, under Rule 38A (1) of the Rules, to the next convenient session of the Court as will be fixed by the Registrar. Costs to abide the outcome of the appeal. Ordered accordingly. DATED at MTWARA this 3rd day of June, 2024. R. J. KEREFU JUSTICE OF APPEAL S. M. RUMANYIKA JUSTICE OF APPEAL A. Z. MGEYEKWA JUSTICE OF APPEAL The Ruling delivered this 4th day of June, 2024 in the presence of Mr. Gide Magila who took brief for Mr. Paschal Kihamba, learned counsel for the Appellant and Mr. Stephen Lekey, learned counsel for the 3rd Respondent is hereby^aKifiedfasa true copy of the original. o > ---- << \ A. L. KALEGEYA DEPUTY REGISTRAR COURT OF APPEAL