Tanroads v Kay Bouvet

1 IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA COMMERCIAL DIVISION AT DAR ES SALAAM MISC. COMMERCIAL APPLICATION NO. 7004 OF 2024 TANZANIA NATIONAL ROADS AGENCY (TANROADS)………………APPLICANT VERSUS KAY BOUVET ENGINEERING LIMITED………………………………RESPONDENT RULING July 5th, 2024 & July 19th, 2024 Morris, J Succinctly, through the present application, the Court is being moved for the order extending time for the applicant to refer dispute to arbitration. The application is preferred under section 14(1) of the Law of Limitation Act, Cap 89 R.E. 2019 (LLA) read together with sections 16 and 89(1) & (2) of the Arbitration Act, R.E. 2020 (AA). It is supported with an affidavit of Gurisha Y. Muwanga, a Senior State Attorney of the applicant. Inversely, the application is opposed by the respondent through a counter affidavit deponed by one Innocent Felix Mushi. 2 The material facts for this application as gleaned from the parties’ affidavits are easy to present. In 2020 the parties concluded a contract for designing, supplying, installing and commissioning of a 2500 TCD Turnkey Sugar Factory for Mbigiri Farm, Morogoro (the project). The project was intended to last for 16 months plus 40 days. However, it was not completed within such time. According to the applicant, the respondent was behind such failure. Thus, a dispute arose between the parties herein. Apparently, the contract contained adjudicatory and arbitral clauses. Subsequently, the dispute was adjudicated before the National Construction Council (NCC) which made its decision on February 1st, 2024. Further, the contract provided that a party dissatisfied with the adjudicator’s decision was required to escalate the matter to arbitration within 28 days of such decision. However, in the matter at hand, none of the parties referred the dispute to arbitration within the agreed timeline. On April 23rd, 2024 this matter was filed before this court. Hearing of the application was conducted orally. Both parties were represented. The applicant was under the representation of Mss. Rehema Mtulya and Mkamba Mshuda, learned State Attorneys. The respondent 3 had Mr. Innocent Mushi, learned counsel to represent him. Submitting for the application, Ms. Mtulya commenced by adopting the affidavit sworn in support of the application. She then, proceeded to state that, for the court to exercise its discretionary powers and extend time; sufficient ground for delay must be exhibited. She further submitted that, though what constitutes sufficient cause is not defined specifically, the case law outlines the elements to guide the court in finding if, or not, the applicant has sufficient reason for the delay. In this regard, reference was made to the case of Lyamuya Construction Co. Ltd v. Board of Registered Trustees of Young Women’s Christian Association of Tanzania, Civil Application No. 2 of 2010 (unreported). It was her contention that, the guidelines in the cited case include, the applicant must account for the delay period; the delay should not be inordinate; he must show diligence not apathy, negligence or loathness; and if the court feels that there are serious matters of importance such as illegality. Therefore, the learned State Attorney maintained that, in this matter the applicant has accounted for the days of delay in the affidavit (paragraphs 7, 8, 9, 10, 15, 16 and 18). She further argued that, the 4 application was filed on March 26th, 2024 after being prepared from March 5th, 2024. Hence, 21 days were spent by the applicant to prepare the application. The above accounting of days notwithstanding, she went on to assert that, the affidavit accounts for illegality under paragraph 17. Henceforth, she was of a view that, this ground is sufficient to warrant extension of time. In addition, she pointed out that, the point of illegality should be manifest on the face of record but details of the illegality are for subsequent stage after extension is granted. To bolster this position, reference was made to unreported cases of AG v Emmanuel Marangakis and Others, Civil Application No. 138 of 2019 (at page 17); Kashinde Machibya v Hafidh Said, Civil Application No. 48 of 2009 (at pages 6-8); and Victoria Real Estate Development Ltd v TIB, Civil Application No. 225 of 2014 (page 15). Finally, she averred that, this matter is full of merits enough to be granted. Submitting in reply, Mr. Mushi also commenced by adopting the counter affidavit filed in opposition of the application. He concurred with applicant that, extension of time is subject to revealing sufficient reason(s) of delay. He thus, maintained that, the Lyamuya’s case (supra) 5 is relevant. He however stated that, the principles therein do not favour the present applicant as he has not accounted the days of delay. He reiterated that parties had 28 days to refer the matter to arbitration from the date of delivery of the adjudication award on February 1st, 2024 but the applicant blew this option. Mr. Mushi stated further that, even after collection of the award on February 26th, 2024; the applicant was still in time for 2 days. However, payment was done after 17 days (23.02.2024). The deadline was thus, falling on 29.02.2024. He thus cemented that; the respondent is not aware of what ground prevented the applicant to do the needful within time. To him, no account was given for the delay, before and after payment. He continued to argue that, even after lapse of the 28 days; the applicant did not act promptly to file this application. The same was filed online on 02.04.2024 and hard copies lodged on 23.04.2024 while the deadline for arbitration was on 29.02.2024. Therefore, the counsel was of the view that, the applicant did not act promptly on all stages hence, occasioning inordinate delay. Submitting on the allegations of illegality, the respondent maintained that, there is no such justification in the present application. 6 To him, illegality must be apparent on the face of the record for the court to see. Regarding the cases referred to by the applicant, the respondent argued that in those respective matters, the applicants exhibited prima facie points of illegalities. He then emphasised that, if the point of illegality is left to be abused by parties, justice will be delayed and defeated. He therefore, prayed for dismissal of the application with costs. In rejoinder Ms. Mtulya maintained that, illegality elements are under paragraph 17 of the affidavit. Hence, prima facie points of illegality have been pointed out, according to her. In addition, Ms. Mshuda rejoined that, the time from 01.02.2024 to the deadline under reference is clearly accounted for in the affidavit. I have conscientiously considered the application at hand. The parties’ affidavits and submissions are at a serious rivalry. However, both parties coincide on the fact that the applicant is out of time to refer their dispute to arbitration proceedings in accordance with their own contract. Nonetheless, the focal contention is on the sufficiency or otherwise of reasons for the tardiness herein. While the applicant maintained that there exist sufficient reasons for extension of time, the respondent asserted that the applicant had none. 7 Therefore, the issue for determination is whether there is a sufficient reason for extension of time in this matter. In support of the application, the applicant has relied upon two leading grounds. One, he has accounted for the delay. Two, the adjudicator’s award is tainted with illegalities. In terms of ground number one, the applicant has averred that, upon being availed with information to collect the adjudicator’s award on February 1st, 2024; he acted diligently and promptly in taking necessary steps to ensure that fitting measures were taken to challenge the same. Paragraphs 20 and 21 of the applicant’s affidavit were relied on. The steps taken, as per the applicant, include being issued with invoice by NCC for settlement of the adjudicator’s outstanding fees to the tune of Tshs. 32,021,875, on February 7th, 2014; payment of adjudication fees on February 23rd, 2024; receiving a hard copy of the award on February 26th, 2014; liaising with other Government Stakeholders including the Office of Solicitor General from February 26th to February 29th, 2024; receiving a letter from the Office of Solicitor General on March 5th, 2024 and the Office of Solicitor General scrutinising the copy of the award through working sessions (as per paras 7, 8, 9, 10, 15 and 16 of 8 the applicant’s affidavit). Thus, basing on the above alleged steps, the applicant maintained that he sufficiently accounted for the delay. The respondent however, firmly disputed the same. He argued that, the applicant failed to account for about 59 days of the delay from February 1st, 2024 when the adjudicator’s decision was delivered to April 23rd, 2024 when the chamber summons was filed in court. On this facet, I have taken into consideration the applicant’s affidavit particularly paragraph 14. The same is to the extent that, the days for challenging the adjudicator’s award as per the parties’ agreement, lapsed on February 29th, 2024. This fact remains undisputed hence, that means the days for challenging the said award started counting from February 1st, 2024 when the same was issued. That being the case, I have further, painstakingly counted up the number of days from February 1st, 2024 to April 23rd, 2024, when this matter was filed in this court. That makes a total of 81 clear days. Collating the foregoing 81 days together with the steps alleged to have been taken by the applicant it is obvious that there are days not accounted for. I have observed that, the applicant has not clearly accounted for the following days: from February 1st, 2024 when he was 9 informed of the readiness of the adjudicator’s award to February 7th, 2024 when the alleged invoice was issued by NCC; from February 7th, 2024 when the said invoice was issued to February 23rd, 2024 when the alleged payments were effected; from February 23rd, 2024 when he received the alleged invoice to February 26th, 2024 when he received hard copy of the award; from March 5th, 2024 when copy of the award was received by the Office of Solicitor General to April 23rd, 2024 when this matter was filed in court. As such, I am in accord with the respondent that, the applicant has failed to account for each day of delay. However, the applicant has specifically advanced allegations of illegalities regarding the adjudicator’s award. In essence, he contests the adjudicator’s mandate on allegations that the latter acted without jurisdiction. Despite such serious allegations, the respondent has not brought forth any disputations on the alleged lack of jurisdiction on part of the adjudicator. Primarily, the counter affidavit does not specifically dispute the allegation on the adjudicator’s mandate. In this regard, the applicant deposes about the claims of jurisdiction under paragraph 17 of the affidavit. 10 In contention, the corresponding paragraph 10 of the counter affidavit is to the effect that the applicant’s allegations hereof “are mere statements and facts which do not support and justify the inordinate delay”. Vividly, this averment and the subsequent depositions under paragraph 10 of the counter affidavit are establishing that the applicant failed to account for the period of delay. As I found earlier, the respondent is succeeding along this contention. Nonetheless, the allegations on lack of jurisdiction on the part of the adjudicator is not evidently countered. As a matter of law, facts which are not specifically disputed by the party are generally considered as being acceptable to him. See, Emmanuel Saguda @ Sulukuka & Another v R, Crim. Appeal No. 422B of 2013; Paulina Samson Ndawavya v. Theresia Thomas Madaha, Civil Appeal No. 45 of 2017 (both unreported). Therefore, failure by the respondent herein to specifically dispute the alleged illegalities of lack of jurisdiction on part of the adjudicator in the affidavit amounts to nothing else but acceptance of such allegations. I am also mindful of the fact that the respondent’s counsel ably submitted on the need for the illegality to be apparent on the face of the 11 record. However, I will with adequate respect reason that, though the details of illegality are the subject of the forthcoming proceedings (if this application is granted); such submissions would be helpful to him if the respondent had deposed on the same point. The clearly settled rule in our legal system is that submissions from the bar is not evidence. Further, it is now trite law that, allegations of illegalities amount to sufficient cause for extension of time. See, for instance, Lyamuya’s case (supra) ; and Attorney General v Wafanyabiashara Soko Dogo Kariakoo Cooperative Society Ltd, Misc. Civil Application No. 606 of 2015(both unreported). Essentially, when the illegality touches on the jurisdiction of the court or quasi-judicial body, the same needs to be settled fully so as to avoid perpetration of illegitimate precedents in the subsequent similar circumstances. Therefore, guided by the above stated position of the law, the issue framed herein, to wit; whether there is a sufficient reason for extension of time in this matter, is determined in affirmation. Consequently, the application is merited. For avoidance of any uncertainty, the applicant is hereby granted twenty-one (21) days from the date of this ruling to refer the dispute to arbitration. 12 In the circumstances of this matter, especially the stance taken by the applicant in the handling of affairs leading to this application; each party is ordered to shoulder own costs. It is so ordered. C.K.K. Morris Judge July 19th, 2024