20120223 TZCA Mwanza

IN THE COURT OF APPEAL OF TANZANIA

ATMWANZA (CORAM:- MSOFFE, J.A., BWANA, J.A., And MJASIRI, J.A.) CIVIL APPEAL NO. 21 OF 2010 TANZANIA FISH PROCESSORS LIMITED .................... APPELLANT

VERSUS CHRISTOPHER LUHANYULA ................................... RESPONDENT (Appeal from the decision of the High Court of Tanzania at Mwanza) (Masanche, J.) :,,. dated the 8 th day of October, 2010 in Civil Appeal No. 37 of 1999

JUDGMENT OF THE COURT 23 & 24 February 2012 MSOFFE, J.A.: The gravamen of this appeal lies in an agreement alleged to have been entered into by the parties way back in 1998. Since the agreement is central to a fair determination of this appeal we hereby take the liberty to reproduce it as under:- / 't 2

MKATABA WA KUKODISHA MTUMBWI NA ENGINE YA BOTI Leo tarehe 11/7/98 Mkataba umefungwa kati ya Mwenye mali (Mtumbwi na Engine) MR. CHRSTOPHER LUHANYULA wa P.O. Box 1410 Mwanza, na Mr. T.F.P. wa P.O. Box 3001 Mwanza, ambaye ni Mkodishaji chini ya Masharti yafuatayo:- 1. Tumekubaliana kukodi kwa muda wa mwezi 1 kwa gharama ya Tshs. 480,000/= (SHILINGI LAKI NNE ELFU THEMANINI TU). Tangu Tarehe 11/7/98 hadi Tarehe 10/8/98.

2. Mtumbwi na Engine pamoja na mali zingine zilizopo ndani ya mtumbwi vitakuwa chini ya uangalizi wa msimamizi mkuu ambaye ameajiriwa na mwenye mali (mtumbwi).

3. Pasho ya Msimamizi Mkuu wa watumishi wengine (vibarua) wa kwenye Mtumbwi watalipwa na mkodishaji.

4. Matengenezo yote (madogo na makubwa) ya Mtumbwi na Engine na service yatakapo jitokeza itakuwa juu ya mkodishaji.

5. Mafuta (petrol) na Vilainisho (oil) n.k. itakuwa juu ya mkodishaji wakati wa kipindi cha mkataba. 3 6. Hivyo basi, pande zote tumekubaliana na yote katika masharti hayo (1-5) ambayo yapo kwenye mkataba huu. i) Jina la Mkodishaji OMAR PAUL Sahihi ................................ (Sgd) ii) Jina la Mwenye mali CHRISTOPHER LUHANYULA sahihi ...................... (Sgd) iii) Jina la shahidi wa Mkodishaji KASSIM MRISHO sahihi ...................... (Sgd) iv) Jina la shahidi wa Mwenye mali HAMISI MUSA sahihi ...................... (Sgd)

STAMP DUTY PAID SHS. 192000 RECEIPT B750560 OF 25.8.99

REGIONAL REVENUE OFFICER VAT

MWANZA From this outset, we wish to say that two things emerge from the above agreement. One, this was an agreement between one Mr. T.F.P. and the respondent herein. Two, strictly speaking, the 4 agreement was also between one OMAR PAUL and the present respondent. According to the respondent, he entered into a contract to hire a fishing boat to the appellant herein at a fee of Shs. 480,000/= per month from 11/7/1998 to 10/8/1998. He never got the money and neither did he get his boat back. Both the trial District Court of Mwanza (Kabengwe, DM) and the High Court (Masanche, J.) ruled in his favour. Dissatisfied, the appellant Company has preferred this second appeal. On 7/12/2010 the High Court (Sumari, J.) granted leave to the appellant to appeal to this Court in which she singled out two points for our consideration and decision. The memorandum of appeal filed by the appellant is an exact replica of those points. The memorandum reads:- 1. That the Honourable Judge erred in law for believing that the disputed contract which was admitted at the trial court as exhibit P.1 'I 5 was valid between the appellant and the respondent as: (a) There was no evidence to show that the appellant authorized one OMAR PAUL to sign the mentioned contract for and on her behalf. (b) The wording of the contract does not sufficiently establish a contractual relationship between the appellant and the respondent.

2. That the Honourable Judge grossly misdirected himself in law by invoking a doctrine of estoppel in his judgment as: (a) There were no special words or conduct made by the appellant. The parties filed written submissions in support of their respective positions in the matter. Further to that, at the hearing of the appeal Messrs. Stephen Magoiga and Dominick Kashumbugu, learned advocates, appeared for the parties, respectively, and addressed us orally. After hearing the parties we propose to dispose of the appeal generally as shall be demonstrated hereunder. 6 A look at the judgments of the courts below will show that a good amount of time was spent in ascertaining whether or not Omar Paul was a conman. In the end, they were satisfied that he was not. This is what the High Court, in particular, stated in respect of the said Omar Paul:- ... The trial magistrate became live to whether or not, really, the one who entere~ into contract, on behalf of the appellant, was a conman. He held that he was not, because the appellants had even towed the boat ashore and placed it in their yard. If there was any fraud at all, they would not have pulled ashore the boat ... (Emphasis supplied.) With respect, the record before us does not indicate anywhere that the appellant towed the boat as alleged. At best, there is record that on 22/7/1999 the trial District Court visited the appellant's

yard, without more. In fact, if there was such a visit we wish to draw the attention of the trial court to the fact that it was not done in line with 7 this Court's guidelines in Nizar M.H. Ladak v Gulamali Fazal . Janmohamed (1980) TLR 29 at page 31 that:- When a visit to a locus in quo is necessary or appropriate, and as we have said this should only be necessary in exceptional cases, the court should attend with the parties and their advocates, if any, and with such witnesses as may have to testify in that particular matter, and for instance if the size of a room or width of road is a matter in issue, have the room or road measured in the presence of the parties, and a note made thereof. When the court re- assembles in the court room, all such notes should be read out to the parties and their advocates, and comments, amendments or objections called for and if necessary incorporated. Witnesses then have to give evidence of all those facts, if they are relevant, and the court only refers to the notes in order to understand or relate to the evidence in court given by the witnesses ... 8 So, as observed above, if at all there was a visit to the locus in quo on 22/7/1999 then it was done contrary to the above guidelines because the record is clear that at 2.00 p.m. on that day when "the court moved to see the canoe at Mwanza South" the parties were absent, no notes were taken

etc. As it is, therefore, there is no record that if the visit was made at all the "canoe" was seen at the yard. If so, the allegation made above that the appellant towed the boat to its yard is an empty statement. It is not our intention to be drawn into a discussion on whether or not Omar Paul was a conman. But, as already stated, one thing is clear:- That the respondent entered into an agreement with one Omar Paul. There is no indication anywhere in both the agreement and in the evidence in court that the appellant authorized Omar Paul to enter into the agreement on its behalf. In fact, if Omar Paul existed at all we wonder why he was not called as a witness by either party to explain his role in the matter. 9 Closely related to the issue of Omar Paul is the other dimension of the case whereby, as pointed out above, it is also evident that this was an agreement between Mr. TFP and the respondent. The record is silent as to who exactly is this person called Mr. TFP. In the totality of the foregoing, it seems to us that there was no agreement known in law between Tanzania Fish Processors Limited and the respondent. This brings us to a brief discussion of the law relating to the subject at hand in relation to this case. Section 100 (1) of the Evidence Act (CAP 6 R.E. 2002) requires that when a document is reduced into writing no evidence shall be given in proof of its terms

etc. This sub-section is premised on the fact that the document is supposed to speak by itself. In this case, the terms of the agreement cannot even be a matter for discussion when it is not even clear that the appellant Company, and it alone, entered into the agreement with the respondent! Section 10 of the Law of Contract Act (CAP 345 R.E. 2002) provides that all agreements are contracts if they are made by the free consent of the parties competent to contract for a lawful consideration and with a lawful object and are not expressly declared to be void. In this case, there is nothing to show that there was free consent by the appellant and the respondent to enter into a contract. It is also clear that there is no record that the said Omar Paul was competent to enter into an agreement with the respondent on behalf of the appellant. Section 34 of the Companies Act (CAP 212 R.E. 2002) reads:- 34. A document or proceeding requmng authentication by a company may be signed by a director, secretary, or other authorized officer of the company, and need not be under its common seal. In this case, there is no dispute that the appellant is a limited liability company. If so, there is nothing to show that Omar Paul had 11 the mandate to enter into the agreement with the respondent on behalf of the appellant in any of the capacities mentioned under section 34 above. It is elementary that

in contracts made by agreement it is necessary that the parties should have reached an agreement. Generally speaking, this is done by the usual procedure of offer and acceptance. As P.S. Atiyah in An Introduction to the Law of Contract, Fifth Edition, at page 55 quotes the words of Pollock:- One party proposes his terms; the other accepts, rejects or meets them with a counter-proposal: and thus they go on till there is a final refusal and breaking-off or till one of them names terms which the other can accept as they stand. Put simply, there is no contract if there is no consensus ad idem. In other words, in a valid contract there has to be a meeting of the minds. Indeed, as clearly spelt out by P. Ramanatha Aiyar in Concise Law Dictionary, Reprint Edition 2005 at page 189, 12 consensus ad idem is one of the essential requisities of formation of a valid contract. In this case, as already observed, there is nothing to show that there was a meeting of the minds between the appellant and the respondent. At best, there was an agreement which has nothing to do with the appellant in this case. For the foregoing reasons, there is merit in this appeal. We hereby allow it with costs. DATED at MWANZA this 23 rd day of February, 2012. J.H. MSOFFE

JUSTICE OF APPEAL S.J. BWANA

JUSTICE OF APPEAL S. MJASIRI

JUSTICE OF APPEAL I certify that this is a true copy of the original. <=$==-- ,r- s eJ.S. MGETTA)

DEPUTY REGISTRAR