NKOLA EXPARTE JUDGMENT

IN THE HIGH COURT OF TANZANIA (MWANZA SUB-REGISTRY) AT MWANZA CIVIL CASE NO. 26508 OF 2023 STANSLAUS MASUNGA NKOLA………………………………………….PLAINTIFF VERSUS NYARUGUSU MINE COMPANY LIMITED……………………………DEFENDANT EXPARTE JUDGMENT 2nd & 30th October, 2024 KAMANA, J. Mr. Stanslaus Masunga Nkola, the plaintiff, has sued Nyarugusu Mine Company Limited, the defendant, for the breach of the loan agreement claiming, among others, TZS 1,193,800,000/- he advanced to the defendant. Briefly, the plaintiff advanced the said amount to the defendant in different tranches in 2018. The purpose of the loan was to enable the defendant, a mining company, to foot bills relating to its operations. It was agreed that the defendant should repay the loan after making the production. Unfortunately, that was not the case. The default made the plaintiff orally remind the defendant of its obligations. On 15th October, 2018, the defendant passed a resolution that it would repay the plaintiff after disposing of its assets. The copy of the 1 resolution was admitted in evidence as Exh.PE2. On 20th October, 2018, the defendant signed an agreement with the plaintiff that recognized the loan of TZS 1,193,800,000/- and reaffirmed its intention to repay the loan. The agreement was admitted as Exh. PE1. However, the defendant did not honour its promise, hence this suit. The suit was heard exparte against the defendant who opted not to defend his case despite being served with the summons. Three issues were framed. One, whether the parties entered into an agreement; Two, if the answer in the first issue is in the affirmative, whether the said agreement was breached by the defendant; and Three, if the answer in the second issue is in the affirmative, to what reliefs the parties are entitled to. On the first issue, Mr. Nkola (PW), led by Mr. Denis Paulin, learned Counsel, testified that in the year 2018, he advanced TZS 1,193,800,000/- to the defendant. According to the witness, the loan was advanced in different tranches. The witness tendered the loan agreement that was signed on 20th October, 2018 which was admitted as Exh.PE1. Concerning the second issue, the witness evidenced further that despite his oral demands for repayment of the loan, the defendant failed to repay the loan despite resolving to pay him as per the defendant’s 2 resolution dated 15th October, 2018 (Exh.PE2) which led to the loan agreement (Exh.PE1). In that case, he beseeched this Court to consider that the defendant has breached the terms of their agreement. On the third issue, PW asked this Court to grant him with the reliefs prayed in his plaint. These include the order that the defendant should pay him TZS 1,193,800,000/-. So far as the first issue is concerned, the plaintiff has proved on the balance of probability that he had an agreement with the defendant concerning the loan of TZS 1,193,800,000/-. I take that position as the plaintiff substantiated his evidence with the loan agreement dated 20th October, 2018 which I have no reason to fault. Further, the plaintiff tendered the defendant’s resolution to pay him the said amount which also I have no reason to fault. Concerning the second issue, the plaintiff evidenced that despite several demands that were made orally, the defendant failed to repay the loan. This made me peruse the agreement to ascertain whether there was a specific date on which the defendant was supposed to repay the loan. I found none. It is an established principle of law that when the loan agreement is silent as to when the loan should be repaid, such loan is repaid on demand. Further, the commencement of the proceedings for recovering 3 the debt is a sufficient demand and no formal demand is required to trigger the commencement of the suit for recovering the loan. In this, I am persuaded by the position taken by Chitty, J in Re Brown’s Estate [1892] 2 Ch 300 where he stated: ‘The law is quite settled that, with regard to a promissory note payable on demand, no demand is necessary before bringing an action... [W]here there is a present debt and a promise to pay on demand, the demand is not considered to be a condition precedent to the bringing of the action.’ In the present case, the defendant was duly served with the plaintiff’s claims concerning the agreement they entered. It is on record that, the defendant was served by way of affixation at its office on 29 th January, 2024. Further, there was an affidavit deponed by Mr. Silas Lucas Isangi, the process server who swore that the summons was fixed at the defendant’s office. Likewise, it is on record that the appellant received the summons by way of postal address on 14th August, 2024. Up to the time of the hearing of the suit, the defendant did not indicate an intention to repay the loan. Given that, I am of the considered view that the appellant was aware of the demands by the plaintiff and has breached the agreement. 4 Since I have held that the defendant has breached the terms of the agreement, the third issue will not detain me. It is hereby ordered that: 1. The defendant should pay the plaintiff TZS 1,193,800,000/-. 2. The defendant should pay the plaintiff 17% interest of TZS 1,193,800,000/- for every month commencing on 29th January, 2024 when he was formally served with the summons to the date of this judgment. 3. Since the defendant failed to repay the loan from 29th January, 2024 when the plaintiff indicated his demands and considering that the said amount could be used by the plaintiff to generate income as he stated in his plaint, the defendant is ordered to pay the plaintiff the general damages to the tune of TZS 85,000,000/-. 4. The defendant should pay the plaintiff 7% of the decretal sum per annum from the date of this judgment to the satisfaction of the decree. 5. The defendant should pay the plaintiff costs of this suit. Order accordingly. Right To Appeal Explained. DATED at MWANZA this 30th of October, 2024. 5 KS KAMANA JUDGE 6