20181206 TZHC Dar es Salaam

-· IN THE HIGH COURT OF TANZANIA AT DAR ES SALAAM CIVIL APPEAL NO. 202 OF 2017 STANBIC BANK TANZANIA LIMITED ............................ APPELLANT VERSUS ._ PAUL FRANCIS KILASARA ............................... ""·······RESPONDENT (Appeal from the decision of the Resident Magistrate~' Court of Dar es Salaam at Kisutu in Civil Case No. 72 of 2016) JUDGMENT MGElTA, J: Before the Court of Resident Magistrate of Dar es Salaam at Kisutu (henceforth the trial court), one Paul Francis Kilasala (henceforth the respondent) who was the plaintiff, successfully sued Stanbic Bank Tanzania Limited (henceforth the appellant) who was the defendant in Civil Case No. 72 Of 2016. In view thereof, on 26.07.2017 the trial court magistrate ordered the following: 1. The plaintiff be paid specific damages by the defendant at a tune of TZS 60/000/000/- 2. The plaintiff be paid TZS 10/000/000/= by the defendant as punitive damages. 1 3. The plaintiff be paid TZS 15,000, 000/- by the defendant as general damages. 4. The plaintiff be paid by the defendant interest at court rate of 7% on the_ decretal sum from the date ofjudgment till payment in full. 5. The defendant to pay costs of the plaintiff in prosecuting the suit. Dissatisfied with the trial ·court decision, the appellant has preferred this appeal in this court. A total of eleven grounds of appeal have been raised in the memorandum of appeal by the appellant through a legal service of Ms. Suzana Matemu, the learned advocate. These are as follows; 1. That the learned trial magistrate erred in law and in fact by holding that the appellant had negligently supplied information of · the respondent to the Credit Bureau while the appellant has never supplied any information to the Credit Bureau. 2. That the learned trial Magistrate erred in law and in fact by holding that the appellant had negligently failed to correct the data in the Credit Info Bureau while the appellant had no such powers/ authority to correct any information to the Credit Info Bureau. Such powers are vested to the Bank of Tanzania by Law. 3. That the learned trial Magistrate erred in law and in fact by holding that the appellant was negligent in correcting the 2 information in the Credit Bureau while the appellant had taken necessary steps including to seek for clearance from Bank of Tanzania to deal with the Credit Bureau direct from/ but the Bank of Tanzania remained mute. 4. That the learned trial Magistrate erred in law and in fact by holding that the respondent was not credit worth due to the information from Credit info system while the report from Credit Info System showed that the respondent had a performing Joan. And the information from Credit Info System is yet to be mandatory for banks in measuring credit worth of persons. 5. That the learned trial magistrate erred in law and in fact by relying a letter said to be from Equity Bank while the said letter contained hearsay and has discrepancies on the face of it. 6. That the learned trial magistrate erred in law and in fact by failing to apply the cardinal principle of evidence that 'he who ·alleges must proof' by holding that the respondent had suffered loss after shifting the duty to disapprove allegations which were proved by the respondent. 3 7. That the learned trial Magistrate erred in law and in fact by holding that the respondent had suffered loss while in his evidence it clearly shows the respondent's profits were increasing year after year. 8. That the learned trial magistrate erred in law and in fact by holding the amount offered to the respondent amounting to 10,000,000 was a contemplation that the respondent had suffered loss while the said amount was given in good faith as to maintain good bank- client relationship. 9. That the learned magistrate erred in law and in fact by failing to give reasons in answering the issue as to whether the plaintiff had suffered loss. 10. That the learned trial magistrate erred in law and in fact by holding that the respondent had suffered special damages while the respondent had not proved any specific loss as the law requires. 11. That the trial magistrate erred in law and in fact by awarding damages basing on mere speculation. 4 ,, Before venturing into the merits of the appeal, it is inevitable to summarize the facts leading to the appeal as I herein do. Paul Francis Kilasara, a business man, testified as plaintiff witness No. 1 (PWl) at the trial court that he is mainly selling clothes at Kariakoo area in Dar es Salaam; and, that he is director of Kila Works and General Suppliers Limited, the same dealing with selling Fibre Glass. The company's TIN and Business Licenses were admitted as Exhibit Pl. He alleged further that he has an account in the appellant bank since the year 2005. Apart from that, he alleged to have been borrowing money from the appellant bank. At first, he borrowed and repaid Tshs. 30,000,000/= and later Tshs. 50,000,000/=. He tendered the contracts to prove the same and both of them were admitted as Exhibit P2 collectively. He further tendered the income tax assessments to show on how he was paying taxes in his business. The same was admitted as Exhibit P3. He explained further that, thereafter his company's capital grew up to Tshs. 50,000;000/=, hence there was a time when he wanted to borrow more money (Tshs. 200,000,000/=) to expand his business. He thereafter approached Equity Bank to secure a loan of the said amount. While, the said Equity Bank was at the final stage to issue the said loan, the bank 5 stopped to finalize the said loan. The reason given was that, the Credit Info Bureau indicated that the respondent had an outstanding loan with the appellant. He was subsequently informed by the Equity Bank on this fact via a letter which was admitted as exhibit P4. Thus, he did not qualify to obtain the intended loan. Thereafter, PW1 went to the Credit Info Bureau in order to get further clarification on the alleged outstanding loan with the appellant. He was then given reports dated 14.3.2016, 27.11.2015 and 14.3.2016 which indicated that the respondent had secured a loan of Tshs. 18,000,000/= with the appellant but only Tshs. 9,000,000/= was repaid. However, only the report dated 14.3.2016 was admitted as exhibit PS. PW1 alleged further exhibit PS had led him to be unable to secure loans even from other banks, including Access Bank, Tanzania Women Bank and Equity Bank. But, it was only the Equity bank which had replied to him. In the event, on 10.9.2015 and 19.7.2015, he wrote letters to the appellant (exhibit P6 collectively) so that the Credit Info Bureau be rectified. The appellant never did the same. Thereafter, he consulted his lawyer who wrote a demand notice to the appellant. The appellant in their letter dated 21.10.2015, exhibit P7 admitted that the problems have been 6 caused by the appellant's mistakes. PW1 explained further his advocate had various correspondences through letters with the appellant on the said problem, as a result the appellant did offer the respondent Tshs. 10,000,000/= as compensation, but he refused. The reason being that PW1 wanted his records in the Credit Info Bureau be rectified by the appellant. These letters were admitted as Exhibit P8 collectively. PW1 alleged since September, 2012 the above stated problem had affected his business because he was regarded as untrustworthy by various banks. Thereafter, his business' revenues started to deteriorate compared to the year 2008. He tendered the summary of expenditure which was admitted as exhibit P10 to prove the loss he had incurred over the appellant's conduct as elaborated herein above. In response to the respondent's claims, John Lukilo who testified as defendant witness No. 1(DW1) stated that since June 2007 he is working with the appellant. Currently he is working as the Manager for Recoveries and Rehabilitation. He admitted to have known the respondent as one of appellant's customers. He alleged the appellant had written a letter to the Credit Reference Bureau (CRB) informing that the respondent had no any outstanding loan with the appellant. The letter was admitted as exhibit D1. 7 DW1 further alleged the appellant wrote other two letters to the Bank of Tanzania (BOT) to rectify on the respondent's status (the two letters dated 1.10.2015 and 15.12.2015 were admitted as exhibit D2 collectively). He alleged that, it was only the BOT which was responsible to do so, since the said data is handled over there. DWl further explained as per the CRB data, the status of the respondent's loan is 'O', that means he was performing his loan with the appellant. Thus, he strongly opposed the respondent's claims in the suit. He insisted that the respondent's allegation that he is denied to secure other loans from the banks is not true. As I have already pointed earlier in this judgment, the trial court determined the suit in the respondent's favour. Hence, the appellant appealed to this court. When the appeal was called on for hearing, the same was argued by way of written submissions. Mr. Emmanuel Nasson, the learned advocate appeared for the appellant; while, Mr. Thomas Eustace Rwebangira, the learned advocate appeared for the respondent. Both learned advocates filed their respective written submissions within the prescribed time. I would therefore like to recommend on the useful rival written submissions from the disputing camps. Of course, their written 8 submissions indicate that a thorough legal research had been done. Well done! For an easy determination of the appeal at hand, since upon going through the entire court records, the submissions from both sides as well as raised grounds of appeal, I shall consolidate them into one issue.That is whether the appellant is responsible for the respondent's information in the Credit Info Bureau alleged being not rectified. As a result, it led to the respondent to suffer loss. · After going thoroughly the submissions from both sides in relation to the court records and for an easy determination of the appeal at hand, in totality, the respondent had successfully sued the appellant basing on the fact that, the appellant negligently did not rectify his status in the said Bureau to indicate there is no outstanding loan from the appellant. On the other side, the appellant denied the allegations on the ground that she had no such a duty to do so; hence, the appellant exonerated from the alleged subsequent consequences. 9 In deliberation of the above stated issue, I shall start by ascertaining as to why the trial court determined the suit in the respondent's favour. In the said judgment, specifically at page 13 the trial court had this to say; 11 ••• the defendant had a duty to report the correct data of the plaintiff to the Credit Info Bureau. Failure to discharge this duty cannot be exonerated from being negligent in handling the credit status of the plaintiff. .. the defendant did not even bother to produce the bank statement of the plaintiff to prove that the information at the Bureau was in conformity with what was rendered as loans to the plaintiff ... " At pages 15 and 16, the trial court went on and stated; "... the defendant did contemplate that situation when they offered the plaintiff Tzs 10/000/000/- as a redress of what happened for being not creditworthy from the information they supplied to the credit information Bureau. " Having in mind with the above extracted findings of the trial court Magistrate, with due respect on what had been submitted by the appellant's advocate herein, I find no sufficient reasons to fault the same. 10 The reason being that, the evidence from the record reveals the respondent had no any outstanding loan from the appellant. This · is evidenced from exhibit P.2 collectively. However, upon PWl's follow up at the Bureau, he was informed to have an outstanding loan of Tshs. 9,000,000/= to the appellant. This is as per PWl's testimony and exhibit P 5. This version of fact was never countered in cross examination. Further, the above encumbrance prevented Equity Bank to issue a loan to the respondent simply because the appellant did not rectify the status of the respondent in the said Bureau even after the respondent had already paid the loan. The same is evidenced by the letter from the Equity Bank to the respondent (exhibit P.4) which indicated that the respondent had an outstanding loan with the appellant. More so, there is further evidence to the effect the respondent had struggled to sort out the said problem. To mention but few the respondent did make a follow up in the Bureau where he was subsequently informed there was an outstanding loan of Tshs. 9,000,000/= with the appellant as far as exhibit PS is concerned. The respondent did not end there, instead he wrote a letter ( exhibit P6) to the appellant so that his status should be rectified. These letters obviously led the appellant to admit her fault as far 11 'I- as exhibit P7 is concerned. The evidence on record goes further that the respondent thereafter consulted with his advocate who managed to have various correspondences with the appellant. In the event, the appellant offered to pay the respondent Tshs. 10,000,000/= as a compensation. Be as it may, upon going through the entire testimony of PWl, I find that the appellant did not counter such serious allegations of the said offer in cross examination. This is because in my considered view the appellant was aware of his fault of not rectifying the respondent's information in the Bureau. In view thereof, it goes without saying that the appellant was the one who handled and referred the respondent's status in the Bureau. Had it been the appellant had no such duty as suggested by her herein, it wouldn't have communicated with the Bureau and BOT, via exhibits D.1 and D.2 so as the same be rectified. All in all, I find what had been suggested by the appellant herein as an afterthought, since it was the appellant who sent such information to the Bureau; definitely the appellant had a duty to rectify the same. This stance is corroborated by the testimony of DWl, where at page 25 in cross examination, said; 12 "The information was sent to BOT by the Defendant. The BOT and Credit Bureau had never changed any information apart from what we submitted .. the plaintiff came to complain to our office through various letters... // Apart from the above extracted evidence from DWl which appeared to suggest that the appellant is trying to exonerate from the liability and shift the burden to the BOT and the said Bureau, however I find the appellant's position on this account as an afterthought. In my view, during the trial, the appellant had an opportunity and right to implead either of the two entities but, instead DWl in cross examination at page 27 of the proceedings, testified; '... the second letter in exhibit D2 collectively we insisted the BOT to act immediately in order to avoid us from any liability. We did not decide to sue BOT or to join BOT.' [Emphasis is mine] In line with the above analysis and reasoning as well as the prevailing circumstances of the matter at hand, I do hereby infer the existence of fact by virtue of section 122 of the Evidence Act [Cap. 6 13 R.E 2002] that the appellant was responsible for the respondent's information in the Bureau which were not rectified. Section 122 of the Evidence Act (supra) states as follows; ~ court may infer the existence of any fact which it thinks /Jkely to have happened, regard being had to common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case. ' The above provision of the law was further cemented in the case of The Board Of Trustees of The National Social Security Fund Versus New Kilimanjaro Bazaar LTD; Civil Appeal No. 16 of 2004 (CA) (unreported) where at page 12 the Court of Appeal had this to say; "the presumption under section 122 of the Evidence Act, 1967 is rebuttable; it is not conclusive presumption. The words 'may infer' in the section leave it to the court to make or not to make the presumption depending upon the circumstances of the particular case." 14 . _, r- • • Turning to the respondent's loss incurred as a result of the appellant's conduct of not rectifying in the Bureau, I find no sufficient reasons to fault the awarded damages to the respondent by the trial court. Of course, the trial. court magistrate properly directed himself before reaching at his findings. For reasons given above, I agree with what has been submitted by Mr. Rwebangira, the learned advocate for the respondent. I thus find the appeal without merits. In the upshot, the appeal is hereby dismissed with costs. It is so ordered. J.S. MGETTA JUDGE 06.12.2018 COURT: This Judgment is delivered today this 6th day of December, . 2018 in the presence of Ms. Irene Rwehumbiza, the learned advocate for the appellant and in the presence of Mr. Thomas 15 Eustace Rwebangira, the learned advocate for the respondent, who is also present. c:: ) --=-- I)/ J.S. MGETTA JUDGE 06.12.2018 COURT: Right of appeal to the Court of Appeal fully explained . =):\=====:s:-s----1/J/ .,..---c::::::::::==·• J.S. MGETTA JUDGE 06.12.2018 t I / 16